<PAGE>
As filed with the Securities and Exchange Commission on February 6, 1997
Registration No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------
RIGGS NATIONAL CORPORATION RIGGS CAPITAL
(Exact name of registrant as specified (Exact name of registrant as specified
in its Charter) in its Trust Agreement)
Delaware Delaware
(State or other jurisdiction of (State or other jurisdiction of
incorporation or organization) incorporation or organization)
52-1217953 To Be Applied For
(I.R.S. Employer Identification Number) (I.R.S. Employer Identification Number)
1503 Pennsylvania Avenue, N.W. c/o RIGGS NATIONAL CORPORATION
Washington, D.C. 20005 1503 Pennsylvania Avenue, N.W.
(301) 887-6000 Washington, D.C. 20005
(Address, including zip code, (301) 887-6000
and telephone number, including (Address, including zip code,
area code, of registrant's and telephone number, including
principal executive offices) area code, of registrant's
principal executive offices)
----------------
Linda A. Madrid, Esq.
Riggs National Corporation
800 17th Street, N.W.
Washington, D.C. 20006
(301) 887-6000
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
----------------
Copy to:
Robert H. Craft, Jr.
Sullivan & Cromwell
1701 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
----------------
Approximate date of commencement of proposed sale of securities to the public:
As soon as practicable after the effective date of this registration statement.
----------------
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [_]
If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_] ___________
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_] __________
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [_]
----------------
The registrants hereby amend this Registration Statement on such date or
dates as may be necessary to delay its effective date until the registrants
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
----------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
============================================================================================================================
Proposed Proposed
maximum maximum Amount of
Amount to be offering price aggregate offering registration
Title of each class of securities to be registered registered per unit(1) price(1) fee
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Junior Subordinated Deferrable Interest Debentures of
Riggs National Corporation (2)....................... 150,000 $1,000 $150,000,000 N/A
Series A Preferred Securities of Riggs Capital........ 150,000 $1,000 $150,000,000 $45,460
Riggs National Corporation Guarantee with respect to
Series A Securities (3)(4)........................... N/A N/A N/A N/A
Total................................................. 150,000 (5) 100% $150,000,000 (5) $45,460
============================================================================================================================
</TABLE>
(1) Estimated solely for the purpose of computing the registration fee.
(2) The Junior Subordinated Deferrable Interest Debentures have been purchased
by Riggs Capital with the proceeds of the sale of the Series A Preferred
Securities.
(3) No separate consideration will be received for the Riggs National
Corporation Guarantee.
(4) This Registration Statement is deemed to cover the Junior Subordinated
Deferrable Interest Debentures of Riggs National Corporation, the rights of
holders of Junior Subordinated Deferrable Interest Debentures of Riggs
National Corporation under the Indenture, the rights of holders of Series A
Preferred Securities under the Trust Agreement and the rights of holders of
the Series A Preferred Securities under the Guarantee, which taken
together, fully, irrevocably and unconditionally guarantee all of the
respective obligations of Riggs Capital under the Series A Preferred
Securities.
(5) Such amount represents the principal amount of Junior Subordinated
Deferrable Interest Debentures issued at their principal amount and the
issue price rather than the principal amount of Junior Subordinated
Deferrable Interest Debentures issued at an original issue discount. Such
amount also represents the initial public offering price of the Riggs
Capital Series A Preferred Securities.
<PAGE>
RIGGS CAPITAL
CROSS REFERENCE SHEET
(Pursuant to Item 501(b) of Regulation S-K)
<TABLE>
<CAPTION>
Form S-3 Item Number and Captions Heading or Location in Prospectus
- ---------------------------------------------------- -------------------------------------------
<S> <C>
1. Forepart of the Registration Statement and
Outside Front Cover Page of Prospectus.......... Facing Page; Cross Reference Sheet;
Outside Front Cover Page of Prospectus
2. Inside Front and Outside Back Cover Pages of
Prospectus...................................... Inside Front and Outside Back Cover Pages
of Prospectus; Available Information;
Incorporation of Certain Documents by
Reference
3. Summary Information, Risk Factors and Ratio
of Earnings to Fixed Charges.................... Prospectus Summary; Risk Factors; Ratio of
Earnings to Fixed Charges and Ratio of
Earnings to Combined Fixed Charges and
Preferred Stock Dividend Requirements
4. Use of Proceeds................................. Use of Proceeds
5. Determination of Offering Price................. *
6. Dilution........................................ *
7. Selling Security Holders........................ Selling Securityholders
8. Plan of Distribution............................ Plan of Distribution
9. Description of Securities to be Registered...... Description of Capital Stock
10. Interests of Named Experts and Counsel.......... Validity of Securities
11. Material Changes................................ Description of the Series A Preferred
Securities; Description of the Series A
Subordinated Debentures; Description of the
Series A Guarantee; Relationship Among the
Series A Preferred Securities, the Series A
Subordinated Debentures, the Expense
Agreement and the Series A Guarantee
12. Incorporation of Certain Information by
Reference....................................... Incorporation of Certain Documents
by Reference
13. Disclosure of Commission Position on
Indemnification for Securities Act
Liabilities..................................... *
</TABLE>
- --------------------
* Not applicable.
-2-
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+ INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE +
+SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY +
+OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES+
+EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE +
+SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE +
+SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE +
+UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF +
+ANY SUCH STATE. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED FEBRUARY 6, 1997
$150,000,000
Riggs National Corporation
Junior Subordinated Deferrable
Interest Debentures
Riggs Capital
8 5/8% Trust Preferred Securities, Series A
(Liquidation Amount $1,000 per Preferred Security)
150,000 Preferred Securities
Fully and Unconditionally Guaranteed by
Riggs National Corporation
The 8 5/8% Trust Preferred Securities, Series A (the "Series A Preferred
Securities"), offered hereby represent beneficial interests in Riggs Capital, a
trust formed under the laws of the State of Delaware (the "Series A Issuer").
Riggs National Corporation, a Delaware corporation (the "Corporation"), is the
owner of all of the beneficial interests represented by common securities of the
Series A Issuer (the "Series A Common Securities" and, collectively with the
Series A Preferred Securities, the "Series A Securities"). The Bank of New York
is the Property Trustee of the
(Continued on the following pages)
See "Risk Factors" beginning on page 15 hereof for certain information
relevant to an investment in the Series A Preferred Securities.
THESE SECURITIES ARE NOT SAVINGS ACCOUNTS, DEPOSITS OR OTHER OBLIGATIONS OF A
BANK OR SAVINGS ASSOCIATION AND ARE NOT INSURED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.
------------------------
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. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE
------------------------
The Series A Preferred Securities offered hereby are being offered for
sale from time to time by the selling securityholders named herein (the "Selling
Securityholders"), and neither the Corporation nor the Series A Issuer will
receive any of the proceeds from such sales. The Series A Preferred Securities
may be sold in the over-the-counter market or on any national securities
exchange or automated quotation system on which the Series A Preferred
Securities may be listed or quoted in the future, in negotiated transactions,
through the writing of options on shares or a combination of such methods of
sale, at market prices prevailing at the time of sale, at prices related thereto
or at negotiated prices. Each Selling Securityholder may sell shares directly to
other purchasers, through agents or through broker-dealers, which may receive
compensation in the form of underwriting discounts, concessions or commissions
(and such compensation may be in excess of customary commissions). See "Plan of
Distribution".
The date of this Prospectus is ________ __, 1997.
<PAGE>
(continued from the previous page)
Series A Issuer. The Series A Issuer exists for the sole purpose of issuing the
Series A Securities and investing the proceeds from the sale thereof in
$154,640,000 aggregate principal amount of 8 5/8% Junior Subordinated Deferrable
Interest Debentures, Series A (the "Series A Subordinated Debentures"), to be
issued by the Corporation. The Series A Subordinated Debentures will mature on
December 31, 2026 ( the "Stated Maturity"). The Series A Preferred Securities
have a preference under certain circumstances with respect to cash distributions
and amounts payable on liquidation, redemption or otherwise over the Series A
Common Securities. See "Description of the Series A Preferred Securities--
Subordination of the Series A Common Securities".
The Series A Preferred Securities were originally issued by the Series A
Issuer to Dillon, Read & Co. Inc. and Friedman, Billings, Ramsey & Co., Inc.
(collectively, the "Initial Purchasers") and were subsequently resold by the
Initial Purchasers to qualified institutional buyers in reliance on Rule 144A
under the Securities Act of 1933, as amended (the "Securities Act"), and to a
limited number of institutional investors that are accredited investors within
the meaning of Rule 501(a) under the Securities Act.
The Series A Preferred Securities are listed on the Private Offerings,
Resales and Trading through Automated Linkages ("PORTAL") market of the National
Association of Securities Dealers, Inc.
Holders of the Series A Preferred Securities are entitled to receive
preferential cumulative cash distributions accumulating from December 13, 1996
and payable semi-annually in arrears on June 30 and December 31 of each year,
commencing June 30, 1997, at the annual rate of 8 5/8% of the Liquidation Amount
(as defined herein) of $1,000 per Series A Preferred Security ("Distributions").
Subject to certain exceptions, the Corporation has the right to defer payment of
interest on the Series A Subordinated Debentures at any time or from time to
time for a period not exceeding 10 consecutive semi-annual periods with respect
to each deferral period (each, an "Extension Period"), provided that no
Extension Period may extend beyond the Stated Maturity of the Series A
Subordinated Debentures. Upon the termination of any such Extension Period and
the payment of all interest then accrued and unpaid (together with interest
thereon at the rate of 8 5/8%, compounded semi-annually, to the extent permitted
by applicable law), the Corporation may elect to begin a new Extension Period
subject to the requirements set forth herein. If interest payments on the Series
A Subordinated Debentures are so deferred, Distributions on the Series A
Preferred Securities will also be deferred, and the Corporation will not be
permitted, subject to certain exceptions described herein, to declare or pay any
cash distributions with respect to the capital stock of the Corporation or debt
securities of the Corporation that rank pari passu with or junior to the Series
A Subordinated Debentures. During an Extension Period, interest on the Series A
Subordinated Debentures will continue to accrue (and the amount of Distributions
to which holders of the Series A Preferred Securities are entitled will
accumulate) at the rate of 8 5/8% per annum, compounded semi-annually, and
holders of the Series A Preferred Securities will be required to accrue interest
income for United States federal income tax purposes. See "Description of the
Series A Subordinated Debentures--Right to Defer Interest Payment Obligation"
and "Certain Federal Income Tax Consequences--Original Issue Discount".
The Corporation has, through the Series A Guarantee, the Trust Agreement,
the Series A Subordinated Debentures, the Indenture and the Expense Agreement
(each as defined herein), taken together, fully, irrevocably and unconditionally
guaranteed all of the Series A Issuer's obligations under the Series A Preferred
Securities. See "Relationship Among the Series A Preferred Securities, the
Series A Subordinated Debentures, the Expense Agreement and the Series A
Guarantee--Full and Unconditional Guarantee". The Series A Guarantee of the
Corporation (the "Series A Guarantee") guarantees the payment of Distributions
and payments on liquidation or redemption of the Series A Preferred Securities,
but only in each case to the extent of funds held by the Series A Issuer, as
described herein. See "Description of the Series A Guarantee". If the
Corporation does not make interest payments on the Series A Subordinated
Debentures held by the Series A Issuer, the Series A Issuer will have
insufficient funds to pay Distributions on the Series A Preferred Securities.
The Series A Guarantee does not cover payment of Distributions when the Series A
Issuer does not have sufficient funds to pay such Distributions. In such event,
a holder of the Series A Preferred Securities may institute a legal proceeding
directly against the Corporation to enforce payment of such Distributions to
such holder. See "Description of the Series A Subordinated Debentures--
Enforcement of Certain Rights by Holders of the Series A Preferred Securities".
The obligations of the Corporation under the Series A Guarantee and the Series A
Subordinated Debentures are subordinate and junior in right of payment to all
Senior Debt (as defined in "Description of the Series A Subordinated
Debentures--Subordination") of the Corporation.
4
<PAGE>
(continued from the previous page)
The Series A Preferred Securities are subject to mandatory redemption, in
whole or in part, upon repayment of the Series A Subordinated Debentures at
their Stated Maturity (as defined herein) or their earlier redemption. Subject
to the Corporation having received prior approval of the Board of Governors of
the Federal Reserve System (the "Federal Reserve") to do so if then required
under applicable capital guidelines or policies, the Series A Subordinated
Debentures are redeemable prior to their Stated Maturity at the option of the
Corporation (i) on or after December 31, 2006, in whole at any time or in part
from time to time at a redemption price (the "Optional Redemption Price") equal
to 104.313% of the principal amount thereof on December 31, 2006, declining
ratably on each December 31 thereafter to 100% on or after December 31, 2016,
plus accrued and unpaid interest thereon to the date of redemption, or (ii) at
any time prior to December 31, 2006, in whole (but not in part), within 90 days
following the occurrence of a Tax Event (as defined herein) or Capital Treatment
Event (as defined herein), at a redemption price (the "Tax or Capital Event
Redemption Price") equal to the Make-Whole Amount (as defined herein) plus, in
each case, accrued and unpaid interest on the Series A Subordinated Debentures
to the date fixed for redemption. See "Description of the Series A Subordinated
Debentures--Optional Redemption" and "Description of the Series A Subordinated
Debentures--Tax Event or Capital Treatment Event Redemption".
The Corporation has the right at any time to terminate the Series A Issuer
and cause the Series A Subordinated Debentures to be distributed to the holders
of the Series A Preferred Securities in exchange therefor upon liquidation of
the Series A Issuer, subject to the Corporation having received prior approval
of the Federal Reserve to do so if then required under applicable capital
guidelines or policies. See "Description of the Series A Preferred Securities--
Liquidation of the Series A Issuer and Distribution of the Series A Subordinated
Debentures to Holders".
In the event of the termination of the Series A Issuer, after satisfaction
of liabilities to creditors of the Series A Issuer as required by applicable
law, the holders of the Series A Preferred Securities will be entitled to
receive a Liquidation Amount of $1,000 per Series A Preferred Security plus
accumulated and unpaid Distributions thereon to the date of payment, which will
be in the form of a distribution of such amount in Series A Subordinated
Debentures, subject to certain exceptions. See "Description of the Series A
Preferred Securities--Liquidation Distribution upon Termination".
The Series A Subordinated Debentures are unsecured and subordinated to all
Senior Debt of the Corporation. At September 30, 1996, the aggregate outstanding
Senior Debt of the Corporation was approximately $192 million. See "Description
of the Series A Subordinated Debentures--Subordination".
The Series A Preferred Securities will be represented by global
certificates registered in the name of The Depository Trust Company ("DTC") or
its nominee, except as set forth below. Beneficial interests in the Series A
Preferred Securities will be shown on, and transfers thereof will be effected
only through, records maintained by participants in DTC. Series A Preferred
Securities in certificated form will not be issued in exchange for the global
certificates. See "Book-Entry Issuance".
IN CONNECTION WITH A PARTICULAR OFFERING, PARTICIPATING UNDERWRITERS
(IF ANY) MAY OVERALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE
MARKET PRICE OF THE SERIES A PREFERRED SECURITIES OFFERED HEREBY AT A LEVEL
ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH TRANSACTIONS
MAY BE EFFECTED IN PORTAL OR OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE
DISCONTINUED AT ANY TIME.
5
<PAGE>
NOTICE TO NEW HAMPSHIRE RESIDENTS
NEITHER THE FACT THAT A REGISTRATION STATEMENT OR AN APPLICATION FOR A
LICENSE HAS BEEN FILED UNDER THIS CHAPTER WITH THE STATE OF NEW HAMPSHIRE NOR
THE FACT THAT A SECURITY IS EFFECTIVELY REGISTERED OR A PERSON IS LICENSED IN
THE STATE OF NEW HAMPSHIRE CONSTITUTES A FINDING BY THE SECRETARY OF STATE THAT
ANY DOCUMENT FILED UNDER RSA 421-B IS TRUE, COMPLETE AND NOT MISLEADING. NEITHER
ANY SUCH FACT NOR THE FACT THAT AN EXEMPTION OR EXCEPTION IS AVAILABLE FOR A
SECURITY OR A TRANSACTION MEANS THAT THE SECRETARY OF STATE HAS PASSED IN ANY
WAY UPON THE MERITS OR QUALIFICATIONS OF, OR RECOMMENDED OR GIVEN APPROVAL TO,
ANY PERSON, SECURITY OR TRANSACTION. IT IS UNLAWFUL TO MAKE, OR CAUSE TO BE
MADE, TO ANY PROSPECTIVE PURCHASER, CUSTOMER, OR CLIENT ANY REPRESENTATION
INCONSISTENT WITH THE PROVISIONS OF THIS PARAGRAPH.
AVAILABLE INFORMATION
The Corporation is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith, files reports, proxy statements and other information with
the Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information can be inspected and copied at the public
reference facilities of the Commission at Room 1024, 450 Fifth Street, N.W.,
Washington, D.C. 20549 and at the regional offices of the Commission located at
7 World Trade Center, 13th Floor, Suite 1300, New York, New York 10048 and Suite
1400, Citicorp Center, 14th Floor, 500 West Madison Street, Chicago, Illinois
60661. Copies of such material can also be obtained at prescribed rates by
writing to the Public Reference Section of the Commission at 450 Fifth Street,
N.W., Washington, D.C. 20549. Such material may also be accessed electronically
by means of the Commission's home page on the Internet at http://www.sec.gov.
Such material can also be inspected and copied at the office of the Nasdaq
National Market, 1735 K Street, N.W., Washington, D.C. 20006.
The Corporation and the Series A Issuer have filed with the Commission a
Registration Statement on Form S-3 (together with all amendments and exhibits
thereto, the "Registration Statement") under the Securities Act with respect to
the securities offered hereby. This Prospectus does not contain all the
information set forth in the Registration Statement, certain portions of which
have been omitted as permitted by the rules and regulations of the Commission.
For further information with respect to the Corporation and the securities
offered hereby, reference is made to the Registration Statement and the exhibits
and the financial statements, notes and schedules filed as a part thereof or
incorporated by reference therein, which may be inspected at the public
reference facilities of the Commission at the addresses set forth above or
through the Commission's homepage on the Internet. Statements made in this
Prospectus concerning the contents of any documents referred to herein are not
necessarily complete, and in each instance are qualified in all respects by
reference to the copy of such document filed as an exhibit to the Registration
Statement.
No separate financial statements of the Series A Issuer have been included
herein. The Corporation and the Series A Issuer do not consider that such
financial statements would be material to holders of the Series A Preferred
Securities because the Series A Issuer is a newly-formed special purpose entity,
has no operating history or independent operations and is not engaged in and
does not propose to engage in any activity other than holding as trust assets
the Series A Subordinated Debentures and issuing the Series A Securities.
Furthermore, taken together, the Corporation's obligations under the Series A
Junior Subordinated Debentures, the Indenture, the Guarantee, the Expense
Agreement and the Trust Agreement (each as defined herein) provide, in the
aggregate, a full, irrevocable and unconditional guarantee of payments of
Distributions and other amounts due on the Series A Preferred Securities. See
"Description of the Series A Preferred Securities", "Description of the Series A
Subordinated Debentures" and "Description of the Series A Guarantee".
6
<PAGE>
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Corporation with the Commission are
incorporated into this Prospectus by reference:
1. The Corporation's Annual Report on Form 10-K for the fiscal year ended
December 31, 1995.
2. The Corporation's Quarterly Reports on Form 10-Q for the quarters ended
March 31, 1996, June 30, 1996 and September 30, 1996 as amended by Form 10-QA
for the quarter ended September 30, 1996.
All reports and proxy statements filed by the Corporation with the
Commission pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act
after the date of this Prospectus and prior to the termination of this offering
shall likewise be deemed to be incorporated in this Prospectus and made a
constituent part hereof by reference from the respective dates of filing. Any
statement contained herein, or in a document all or a portion of which is
incorporated by reference herein, shall be deemed to be modified or superseded
for purposes of the Registration Statement and this Prospectus to the extent
that a statement contained herein or in any other subsequently filed document
which also is or 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 the
Registration Statement or this Prospectus.
Any statements contained herein or in a document all or a portion of which
incorporated or deemed to be incorporated by reference herein shall be deemed to
be modified or superseded for purposes of the Registration Statement to the
extent that a statement contained herein or in any other subsequently filed
document which also is or 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 the Registration Statement.
The Corporation will provide, without charge, to any person to whom this
Prospectus is delivered, on the written or oral request of such person, a copy
of any or all of the foregoing documents incorporated by reference herein (other
than exhibits not specifically incorporated by reference into the text of such
documents). Requests for such documents should be directed to Ms. Linda Madrid
at the corporate headquarters of the Corporation, 1503 Pennsylvania Avenue,
N.W., Washington, D.C. 20005 (telephone no. (301) 887-6000).
7
<PAGE>
PROSPECTUS SUMMARY
This summary is qualified by the more detailed information and financial
statements in the Corporation's Annual Report on Form 10-K, Quarterly Reports on
Form 10-Q and Amended Quarterly Report on Form 10-QA, which are incorporated by
reference in this Prospectus. As used herein, (i) the "Indenture" means the
Series A Subordinated Indenture, as amended and supplemented from time to time,
between the Corporation and The Bank of New York, as trustee (the "Debenture
Trustee"), and (ii) the "Trust Agreement" means the Amended and Restated Trust
Agreement relating to the Series A Issuer among the Corporation, as depositor,
The Bank of New York, as property trustee (the "Property Trustee"), The Bank of
New York (Delaware), as Delaware trustee (the "Delaware Trustee"), and the
Administrative Trustees named therein (collectively with the Property Trustee
and Delaware Trustee, the "Series A Issuer Trustees").
The Corporation
The Corporation is a Washington, D.C.-based bank holding company registered
under the Bank Holding Company Act of 1956, as amended (the "BHCA"), which
operates throughout the Washington, D.C. metropolitan area. At September 30,
1996, the Corporation had total assets of $4.7 billion. The Corporation also has
banking operations or separate subsidiaries in Miami, Florida; London, England;
Paris, France; and Nassau, Bahamas.
The Corporation's principal subsidiary is Riggs Bank N.A. ("Riggs Bank"), a
national banking association founded in 1836 and incorporated under the national
banking laws of the United States in 1896. In early 1996, the Corporation
consolidated its three separate banking subsidiaries: The Riggs National Bank of
Washington, D.C., The Riggs National Bank of Maryland and The Riggs National
Bank of Virginia under the name Riggs Bank N.A. At September 30, 1996, Riggs
Bank had assets of $4.7 billion, deposits of $3.8 billion and stockholders'
equity of $513.7 million. Riggs Bank operates 57 branches and an investment
advisory subsidiary in the Washington, D.C. metropolitan area, a commercial bank
in London, an Edge Act subsidiary in Miami, a branch office in London, a bank in
Paris, and a bank and trust company in the Bahamas.
Riggs AP Bank Limited ("Riggs AP"), a merchant bank located in London, is a
wholly-owned subsidiary of Riggs Bank which provides traditional corporate
banking services, commercial property financing, private banking services and
trade finance. At September 30, 1996, Riggs AP had total assets of $282.1
million, representing 6.0% of the Corporation's total assets, and had loans of
$189.7 million, representing 81.8% of the Corporation's total foreign loans and
7.3% of its total loans.
The Corporation is a Delaware corporation with its principal office at 1503
Pennsylvania Avenue, N.W., Washington, D.C. 20005. Its telephone number is (301)
887-6000.
The Series A Issuer
The Series A Issuer is a statutory business trust formed under Delaware law
pursuant to (i) the Trust Agreement executed by the Corporation, as depositor,
The Bank of New York, as Property Trustee, The Bank of New York (Delaware), as
Delaware Trustee, and the Administrative Trustees named therein and (ii) the
filing of a certificate of trust with the Delaware Secretary of State on
November 15, 1996. Prior to the issuance of the Series A Preferred Securities,
the trust agreement was amended and restated in its entirety as described herein
(as so amended and restated, the "Trust Agreement"). All of the Series A Common
Securities are owned by the Corporation. The Corporation has acquired Series A
Common Securities in an aggregate Liquidation Amount equal to 3% of the total
capital of the Series A Issuer. The Series A Issuer exists for the exclusive
purposes of (i) issuing and selling the Series A Securities, (ii) using the
proceeds from the sale of the Series A Securities to acquire Series A
Subordinated Debentures issued by the Corporation and (iii) engaging in only
those other activities necessary or
8
<PAGE>
incidental thereto (such as registering the transfer of the Series A
Securities). Accordingly, the Series A Subordinated Debentures are the sole
assets of the Series A Issuer, and payments under the Series A Subordinated
Debentures are the sole revenues of the Series A Issuer. The principal executive
office of the Series A Issuer is 1503 Pennsylvania Avenue, N.W., Washington,
D.C. 20005, and its telephone number is (301) 887-6000.
The Offering
The Series A Issuer................... Riggs Capital, a Delaware statutory
business trust (the "Series A
Issuer"). The sole assets of the
Series A Issuer are the Series A
Subordinated Debentures.
Securities Offered.................... 8 5/8% Trust Preferred Securities,
Series A (the "Series A Preferred
Securities"), evidencing undivided
beneficial interests in the assets of
the Series A Issuer. The Series A
Preferred Securities offered hereby
were originally issued by the Series
A Issuer to the Initial Purchasers
and were subsequently resold by the
Initial Purchasers to qualified
institutional buyers in reliance on
Rule 144A under the Securities Act
and to a limited number of
institutional investors that are
accredited investors within the
meaning of Rule 501(a) under the
Securities Act in December 1996 (the
"December Securities Sale").
Distributions......................... Holders of the Series A Preferred
Securities are entitled to receive
cumulative cash Distributions at an
annual rate of 8 5/8% of the
Liquidation Amount of $1,000 per
Series A Preferred Security,
accumulating from December 13, 1996
and payable semi-annually in arrears
on June 30 and December 31 of each
year, commencing on June 30, 1997.
The distribution rate and the
distribution and other payment dates
for the Series A Preferred Securities
will correspond to the interest rate
and interest and other payment dates
on the Series A Subordinated
Debentures. See "Description of the
Series A Preferred Securities".
Series A Subordinated Debentures...... The Series A Issuer has invested the
proceeds from the issuance of the
Series A Securities in an equivalent
amount of the Series A Subordinated
Debentures. The Series A Subordinated
Debentures will mature on December
31, 2026. The Series A Subordinated
Debentures rank subordinate and
junior in right of payment to all
Senior Debt of the Corporation, which
is generally defined to include all
other current and future indebtedness
of the Corporation (except trade and
other liabilities arising in the
ordinary course of business), unless
such other indebtedness expressly
provides that it is not superior in
right of payment to the Series A
Debentures. At
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<PAGE>
September 30, 1996, the Corporation had
approximately $192 million of
outstanding Senior Debt. In addition,
because the Corporation is a holding
company, the Corporation's obligations
under the Series A Subordinated
Debentures are effectively subordinated
to all existing and future liabilities
and obligations of its subsidiaries. See
"Risk Factors--Ranking of Subordinated
Obligations Under the Series A Guarantee
and the Series A Subordinated
Debentures" and "--Holding Company
Liquidity" and "Description of the
Series A Subordinated Debentures--
Subordination".
Series A Guarantee.................... Payments of Distributions out of
moneys held by the Series A Issuer,
and payments on liquidation of the
Series A Issuer or the redemption of
the Series A Preferred Securities,
are guaranteed by the Corporation to
the extent the Series A Issuer has
funds available therefor. The
Corporation's obligations under the
Series A Guarantee, taken together
with its obligations under the Series
A Subordinated Debentures, the
Indenture and the Expense Agreement,
constitute a full and unconditional
guarantee of all of the Series A
Issuer's obligations under the Series
A Preferred Securities. See
"Description of the Series A
Guarantee" and "Relationship Among
the Series A Preferred Securities,
the Series A Subordinated Debentures,
the Expense Agreement and the Series
A Guarantee". The obligations of the
Corporation under the Series A
Guarantee are subordinate and junior
in right of payment to all Senior
Debt of the Corporation. See "Risk
Factors--Ranking of Subordinated
Obligations Under the Series A
Guarantee and the Series A
Subordinated Debentures" and
"Description of the Series A
Guarantee".
Right to Defer Interest............... So long as no event of default under
the Indenture has occurred and is
continuing, the Corporation has the
right under the Indenture at any time
during the term of the Series A
Subordinated Debentures to defer the
payment of interest at any time or
from time to time for a period not
exceeding 10 consecutive semi-annual
periods with respect to each
Extension Period, provided that no
Extension Period may extend beyond
the Stated Maturity of the Series A
Subordinated Debentures. At the end
of such Extension Period, the
Corporation must pay all interest
then accrued and unpaid (together
with interest thereon at the annual
rate of 8 5/8%, compounded
semi-annually, to the extent
permitted by applicable law). During
an
10
<PAGE>
Extension Period, interest will
continue to accrue and holders of the
Series A Subordinated Debentures (or
holders of the Series A Preferred
Securities, while outstanding) will
be required to accrue interest income
for United States federal income tax
purposes.
During any such Extension Period, the
Corporation may not, and may not
permit any subsidiary of the
Corporation to, (i) declare or pay
any dividends or distributions on, or
redeem, purchase, acquire or make a
liquidation payment with respect to,
any of the Corporation's capital
stock or (ii) make any payment of
principal, interest or premium, if
any, on or repay, repurchase or
redeem any debt securities of the
Corporation that rank pari passu with
or junior in right of payment to the
Series A Subordinated Debentures or
make any guarantee payments with
respect to any guarantee by the
Corporation of the debt securities of
any subsidiary of the Corporation if
such guarantee ranks pari passu with
or junior in right of payment to the
Series A Subordinated Debentures
(other than (a) dividends or
distributions in common stock of the
Corporation, (b) any declaration of a
dividend in connection with the
implementation of a stockholders'
rights plan, the issuance of stock
under any such plan in the future or
the redemption or repurchase of any
such rights pursuant thereto, (c)
payments under the Series A Guarantee
and (d) purchases of common stock
related to the issuance of common
stock or rights under any of the
Corporation's benefit plans for its
directors, officers or employees).
Prior to the termination of any such
Extension Period, the Corporation may
further defer the payment of interest
on the Series A Subordinated
Debentures, provided that no
Extension Period may exceed 10
consecutive semi-annual periods or
extend beyond the Stated Maturity of
the Series A Subordinated Debentures.
There is no limitation on the number
of times that the Corporation may
elect to begin an Extension Period.
See "Description of the Series A
Subordinated Debentures--Right to
Defer Interest Payment Obligation"
and "Certain Federal Income Tax
Consequences--Original Issue
Discount".
Optional and Tax or Capital Treatment
Event Redemption...................... Subject to the Corporation having
received prior approval of the
Federal Reserve to do so if then
required under applicable capital
guidelines or policies, the Series A
Subordinated Debentures are subject
to redemption prior to their Stated
Maturity at
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<PAGE>
the option of the Corporation (i) on
or after December 31, 2006, in whole
at any time or in part from time to
time at the Optional Redemption Price
equal to 104.313% of the principal
amount thereof on December 31, 2006,
declining ratably on each December 31
thereafter to 100% on or after
December 31, 2016, plus accrued and
unpaid interest thereon to the date
of redemption, or (ii) at any time
prior to December 31, 2006, in whole
(but not in part), within 90 days
following the occurrence and
continuation of a Tax Event (as
defined herein) or Capital Treatment
Event (as defined herein), at a
redemption price (the "Tax or Capital
Event Redemption Price") equal to the
Make-Whole Amount (as defined herein)
plus accrued and unpaid interest on
the Series A Subordinated Debentures
to the date fixed for redemption.
If the Series A Subordinated
Debentures are redeemed prior to
their Stated Maturity, the Series A
Issuer must apply the proceeds of
such redemption to redeem a Like
Amount (as defined herein) of the
Series A Preferred Securities and the
Series A Common Securities. The
Series A Preferred Securities will be
redeemed upon repayment of the Series
A Subordinated Debentures at their
Stated Maturity. See "Description of
the Series A Preferred
Securities--Redemption".
Distribution of the Series A
Subordinated Debentures upon
Liquidation of the Series A Issuer.... The Corporation has the right at any
time, subject to the prior approval of
the Federal Reserve if then required
under applicable capital guidelines or
policies, to terminate the Series A
Issuer and cause the Series A
Subordinated Debentures to be
distributed to the holders of the Series
A Preferred Securities and the Series A
Common Securities in exchange therefor
upon liquidation of the Series A Issuer.
In the event of the liquidation of the
Series A Issuer, after satisfaction of
the claims of creditors of the Series A
Issuer, if any, as provided by
applicable law, the holders of the
Series A Preferred Securities will be
entitled to receive a Liquidation Amount
of $1,000 per Series A Preferred
Security plus accumulated and unpaid
Distributions thereon to the date of
payment, which may be in the form of a
distribution of a Like Amount (as
defined herein) of the Series A
Subordinated Debentures, subject to
certain exceptions as described herein.
See "Description of the Series A
Preferred
12
<PAGE>
Securities--Liquidation of the Series
A Issuer and Distribution of the
Series A Subordinated Debentures to
Holders".
Use of Proceeds....................... The Corporation will not receive any
proceeds from the sale of the Series
A Preferred Securities offered
hereby; all such proceeds will be
received by the Selling
Securityholders.
Shelf Registration Statement.......... Pursuant to a registration rights
agreement dated December 13, 1996
(the "Registration Rights Agreement")
between the Corporation, the Series A
Issuer and the Initial Purchasers,
the Corporation and the Series A
Issuer have agreed to use their
reasonable best efforts to keep a
shelf registration statement (the
"Shelf Registration Statement") with
respect to the Series A Preferred
Securities, the Series A Guarantee
and the Series A Subordinated
Debentures (together, the
"Registrable Securities") effective
until three years after the date it
is declared effective or such earlier
date as all Registrable Securities
shall have been disposed of or on
which all Registrable Securities held
by persons that are not affiliates of
the Corporation or the Series A
Issuer may be resold without
registration pursuant to Rule 144(k)
under the Securities Act (the
"Effectiveness Period"), subject to
certain exceptions. The Shelf
Registration Statement is generally
intended to permit the Selling
Securityholders to resell from time
to time the Registrable Securities
that they purchased in transactions
which were exempted from the
registration requirements of the
Securities Act. Purchasers of the
Registrable Securities offered
pursuant to this Prospectus will not
have any rights under the
Registration Rights Agreement
(although all of the Registrable
Securities sold pursuant to this
Registration Statement will be freely
tradeable except by purchasers who
are "affiliates" of the Corporation
or the Series A Issuer or
"underwriters" of the Registrable
Securities for purposes of the
Securities Act). The Registration
Statement, of which this Prospectus
is a part, has been filed by the
Corporation and the Series A Issuer
with the Commission in order to meet
the Corporation's and the Series A
Issuer's obligations under the
Registration Rights Agreement. See
"Registration Rights Agreement".
Risk Factors
An investment in the Series A Preferred Securities involves substantial
risks that should be considered by prospective purchasers. In addition, because
holders of the Series A Preferred Securities may receive Series A
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<PAGE>
Subordinated Debentures on termination of the Series A Issuer, prospective
purchasers of the Series A Preferred Securities are also making an investment
decision with regard to the Series A Subordinated Debentures and should
carefully review all of the information regarding the Series A Subordinated
Debentures contained herein. See "Description of the Series A Subordinated
Debentures" and "Risk Factors".
14
<PAGE>
RISK FACTORS
Prospective purchasers of the Series A Preferred Securities should carefully
review the information contained elsewhere in this Prospectus and should
particularly consider the following matters. In addition, because holders of the
Series A Preferred Securities may receive Series A Subordinated Debentures in
exchange therefor on termination of the Series A Issuer, prospective purchasers
of the Series A Preferred Securities are also making an investment decision with
regard to the Series A Subordinated Debentures and should carefully review all
of the information regarding the Series A Subordinated Debentures contained
herein. See "Description of the Series A Subordinated Debentures".
Ranking of Subordinated Obligations Under the Series A Guarantee and the
Series A Subordinated Debentures
The obligations of the Corporation under the Series A Guarantee issued by the
Corporation for the benefit of the holders of the Series A Preferred Securities
are unsecured and rank subordinate and junior in right of payment to all Senior
Debt of the Corporation, which is generally defined to include all other current
and future indebtedness of the Corporation (except trade and other liabilities
arising in the ordinary course of business), unless such other indebtedness
expressly provides that it is not superior in right of payment to the Series A
Subordinated Debentures. The obligations of the Corporation under the Series A
Subordinated Debentures are subordinate and junior in right of payment to all
such Senior Debt of the Corporation. Because the Corporation is a holding
company, the right of the Corporation to participate in any distribution of
assets of any subsidiary, including Riggs Bank, upon such subsidiary's
liquidation or reorganization or otherwise (and thus the ability of holders of
the Series A Preferred Securities to benefit indirectly from such distribution),
is subject to the prior claims of creditors of that subsidiary, except to the
extent that the Corporation may itself be recognized as a creditor of that
subsidiary. There are various legal limitations on the extent to which certain
of the Corporation's subsidiaries may extend credit, pay dividends or otherwise
supply funds to, or engage in transactions with, the Corporation or certain of
its other subsidiaries. Accordingly, the Series A Subordinated Debentures and
the Series A Guarantee are effectively subordinated to all existing and future
liabilities of the Corporation's subsidiaries, and holders of the Series A
Subordinated Debentures should look only to the assets of the Corporation for
payments on the Series A Subordinated Debentures. See "The Corporation". None of
the Indenture, the Series A Guarantee, the Expense Agreement or the Trust
Agreement places any limitation on the amount of secured or unsecured debt,
including Senior Debt, that may be incurred by the Corporation. See "Description
of the Series A Guarantee--Status of the Series A Guarantee" and "Description of
the Series A Subordinated Debentures--Subordination".
The ability of the Series A Issuer to pay amounts due on the Series A
Preferred Securities is solely dependent upon the Corporation making payments on
the Series A Subordinated Debentures as and when required.
Holding Company Liquidity
As a holding company, the Corporation conducts its operations principally
through its subsidiaries and, therefore, its principal source of cash, other
than its investing and financing activities, is receipt of dividends from Riggs
Bank and the Corporation's other subsidiary banks. However, there are legal
limitations on the source and amount of dividends that a national bank such as
Riggs Bank is permitted to pay. A national bank may pay dividends only to the
extent that retained net profits (including the portion transferred to surplus)
exceed bad debts (as defined by regulation). Moreover, unless a national bank's
surplus fund equals its common capital, dividends may be paid only after 10
percent of its net profits (as defined by regulation) for the specified
preceding period have been transferred to the bank's surplus fund. In addition,
prior approval of the Office of Comptroller of the Currency (the "OCC") is
required if the total of all dividends declared by a national bank in any
calendar year will exceed the sum of that bank's net profits for that year and
its retained net profits for the preceding two calendar years, less any
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<PAGE>
required transfers to either surplus or any fund for retirement of any preferred
stock. The payment of dividends by Riggs Bank may also be affected by other
factors, such as requirements for the maintenance of adequate capital. In
addition, the OCC is authorized to determine, under certain circumstances
relating to the financial condition of a national bank, whether the payment of
dividends would be an unsafe or unsound banking practice and to prohibit payment
thereof.
Right to Defer Interest Payment Obligation; Tax Consequences; Market Price
Consequences
So long as no event of default under the Indenture has occurred or is
continuing, the Corporation has the right under the Indenture to defer the
payment of interest on the Series A Subordinated Debentures, at any time or from
time to time, for a period not exceeding 10 consecutive semi-annual periods with
respect to each Extension Period, provided that no Extension Period may extend
beyond the Stated Maturity of the Series A Subordinated Debentures. As a
consequence of any such deferral, semi-annual Distributions on the Series A
Preferred Securities by the Series A Issuer will also be deferred (and the
amount of Distributions to which holders of the Series A Preferred Securities
are entitled will accumulate additional Distributions thereon at the rate of
8/5//8% per annum, compounded semi-annually from the relevant payment date for
such Distributions) during any such Extension Period. During any such Extension
Period, the Corporation may not, and may not permit any subsidiary of the
Corporation to, (i) declare or pay any dividends or distributions on, or redeem,
purchase, acquire or make a liquidation payment with respect to, any of the
Corporation's capital stock, (ii) make any payment of principal, interest or
premium, if any, on or repay, repurchase or redeem any debt securities of the
Corporation that rank pari passu with or junior in interest to the Series A
Subordinated Debentures or (iii) make any guarantee payments with respect to any
guarantee by the Corporation of the debt securities of any subsidiary of the
Corporation if such guarantee ranks pari passu with or junior in interest to the
Series A Subordinated Debentures (other than (a) dividends or distributions in
common stock of the Corporation, (b) any declaration of a dividend in connection
with the implementation of a stockholders' rights plan, or the issuance of stock
under any such plan in the future or the redemption or repurchase of any such
rights pursuant thereto, (c) payments under the Series A Guarantee and (d)
purchases of common stock related to the issuance of common stock or rights
under any of the Corporation's benefit plans for its directors, officers or
employees). Prior to the termination of any such Extension Period, the
Corporation may further defer the payment of interest, provided that no
Extension Period may exceed 10 consecutive semi-annual periods or extend beyond
the Stated Maturity of the Series A Subordinated Debentures. Upon the
termination of any Extension Period and the payment of all interest then accrued
and unpaid on the Series A Subordinated Debentures (together with interest
thereon at the annual rate of 8 5/8%, compounded semi-annually from the
relevant payment date for such interest, to the extent permitted by applicable
law), the Corporation may elect to begin a new Extension Period subject to the
above requirements. There is no limitation on the number of times that the
Corporation may elect to begin an Extension Period. See "Description of the
Series A Preferred Securities--Distributions" and "Description of the Series A
Subordinated Debentures--Right to Defer Interest Payment Obligation".
Should an Extension Period occur, a holder of the Series A Preferred
Securities will continue to accrue income (in the form of original issue
discount) for United States federal income tax purposes in respect of its pro
rata share of the Series A Subordinated Debentures held by the Series A Issuer.
As a result, a holder of the Series A Preferred Securities will be required to
include such income in gross income for United States federal income tax
purposes in advance of the receipt of cash and will not receive the cash related
to such income from the Series A Issuer if the holder disposes of the Series A
Preferred Securities prior to the record date for the payment of Distributions.
See "Certain Federal Income Tax Consequences--Original Issue Discount" and "--
Sales or Redemption of the Series A Preferred Securities".
The Corporation has no current intention of exercising its right to defer
payments of interest on the Series A Subordinated Debentures. However, should
the Corporation elect to exercise such right in the future, the market price of
the Series A Preferred Securities is likely to be affected. A holder that
disposes of its Series A Preferred Securities during an Extension Period,
therefore, might not receive the same return on its investment as a holder that
continues to hold its Series A Preferred Securities. In addition, as a result of
the existence of the Corporation's right
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<PAGE>
to defer interest payments, the market price of the Series A Preferred
Securities may be more volatile than the market prices of other securities on
which original issue discount accrues that are not subject to such deferrals.
Tax Event or Capital Treatment Event--Redemption
Upon the occurrence and continuation of a Tax Event or a Capital Treatment
Event before December 31, 2006, the Corporation has the right to redeem the
Series A Subordinated Debentures in whole (but not in part) within 90 days
following the occurrence of such Tax Event or Capital Treatment Event and
therefore cause a mandatory redemption of the Series A Preferred Securities. The
exercise of such right is subject to the Corporation having received prior
approval of the Federal Reserve to do so if then required under applicable
guidelines or policies. See "Description of the Series A Debentures--Tax Event
or Capital Treatment Event Redemption".
A "Tax Event" means the receipt by the Series A Issuer of an opinion of
counsel experienced in such matters to the effect that, as a result of any
amendment to, or change (including any announced prospective change) in, the
laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein, or as a result of any
official administrative pronouncement or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
such pronouncement or decision is announced on or after the date of issuance of
the Series A Preferred Securities under the Trust Agreement, there is more than
an insubstantial risk that (i) the Series A Issuer is, or will be within 90 days
of the date of such opinion, subject to United States federal income tax with
respect to income received or accrued on the Series A Subordinated Debentures,
(ii) interest payable by the Corporation on the Series A Subordinated Debentures
is not, or within 90 days of such the date of opinion, will not be, deductible
by the Corporation, in whole or in part, for United States federal income tax
purposes or (iii) the Series A Issuer is, or will be within 90 days of the date
of the opinion, subject to more than a de minimis amount of other taxes, duties
or other governmental charges. See "Description of the Series A Subordinated
Debentures--Tax Event or Capital Treatment Event Redemption".
See "Certain Federal Income Tax Consequences--Possible Tax Law Changes" for a
discussion of certain legislative proposals that, if adopted, could give rise to
a Tax Event, which could permit the Corporation to cause a redemption of the
Series A Preferred Securities prior to December 31, 2006.
"Capital Treatment Event" means the reasonable determination by the
Corporation that, as a result of the occurrence of any amendment to, or change
(including any announced prospective change) in, the laws (or any regulations
thereunder) of the United States or any political subdivision thereof or
therein, or as a result of any official or administrative pronouncement or
action or judicial decision interpreting or applying such laws or regulations,
which amendment or change is effective or such pronouncement, action or decision
is announced on or after the date of issuance of the Series A Preferred
Securities under the Trust Agreement, there is more than an insubstantial risk
that the Corporation will not be entitled to treat an amount equal to the
Liquidation Amount of the Series A Preferred Securities as "Tier I Capital" (or
the then equivalent thereof) for purposes of the capital adequacy guidelines of
the Federal Reserve, as then in effect and applicable to the Corporation.
Liquidation of the Series A Issuer and Distribution of the Series A Subordinated
Debentures to Holders
The Corporation has the right at any time to terminate the Series A Issuer
and, after satisfaction of liabilities to creditors of the Series A Issuer as
required by applicable law, cause the Series A Subordinated Debentures to be
distributed to the holders of the Series A Preferred Securities in exchange
therefor in liquidation of the Series A Issuer. The exercise of such right is
subject to the Corporation having received prior approval of the Federal Reserve
if then required under applicable capital guidelines or policies. See
"Description of the Series A Preferred Securities--Liquidation of the Series A
Issuer and Distribution of the Series A Subordinated Debentures to Holders".
In the event the Corporation distributes the Series A Subordinated Debentures
to the holders of the Series A Preferred Securities, the holders of the Series A
Subordinated Debentures will have the same registration rights
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<PAGE>
as they had as holders of the Series A Preferred Securities pursuant to the
Registration Rights Agreement. See "Registration Rights Agreement".
Rights under the Series A Guarantee
The Series A Guarantee guarantees to the holders of the Series A Preferred
Securities the following payments, to the extent not paid by the Series A
Issuer: (i) any accumulated and unpaid Distributions required to be paid on the
Series A Preferred Securities, to the extent that the Series A Issuer has funds
on hand available therefor at such time, (ii) the redemption price with respect
to any Series A Preferred Securities called for redemption, to the extent that
the Series A Issuer has funds on hand available therefor at such time and (iii)
upon a voluntary or involuntary dissolution, winding-up or liquidation of the
Series A Issuer (unless the Series A Subordinated Debentures are distributed to
holders of the Series A Preferred Securities in exchange therefor), the lesser
of (a) the aggregate of the Liquidation Amount and all accumulated and unpaid
Distributions to the date of payment, to the extent that the Series A Issuer has
funds on hand available therefor at such time, and (b) the amount of assets of
the Series A Issuer remaining available for distribution to holders of the
Series A Preferred Securities after payment of creditors of the Series A Issuer
as required by applicable law.
If the Corporation were to default on its obligation to pay amounts payable
under the Series A Subordinated Debentures, the Series A Issuer would lack funds
for the payment of Distributions or amounts payable on redemption of the Series
A Preferred Securities or otherwise, and, in such event, holders of the Series A
Preferred Securities would not be able to rely upon the Series A Guarantee for
payment of such amounts. The holders of not less than a majority in aggregate
Liquidation Amount of the Series A Preferred Securities have the right to direct
the time, method and place of conducting any proceeding for any remedy available
to the Guarantee Trustee in respect of the Series A Guarantee or to direct the
exercise of any trust power conferred upon the Guarantee Trustee under the
Series A Guarantee. Any holder of the Series A Preferred Securities may
institute a legal proceeding directly against the Corporation to enforce its
rights under the Series A Guarantee without first instituting a legal proceeding
against the Series A Issuer, the Guarantee Trustee or any other person or
entity. In addition, in the event an event of default under the Indenture shall
have occurred and be continuing and such event is attributable to the failure of
the Corporation to pay interest on or principal (or premium, if any) of the
Series A Subordinated Debentures on the applicable payment date, a holder of the
Series A Preferred Securities may institute a legal proceeding directly against
the Corporation for enforcement of payment to such holder of the principal (or
premium, if any) of or interest on such Series A Subordinated Debentures having
a principal amount equal to the aggregate Liquidation Amount of the Series A
Preferred Securities of such holder (a "Direct Action"). In connection with such
Direct Action, the Corporation has a right of set-off under the Indenture to the
extent of any payment made by the Corporation to such holder of the Series A
Preferred Securities in the Direct Action. Except as described herein, holders
of the Series A Preferred Securities will not be able to exercise directly any
other remedy available to the holders of the Series A Subordinated Debentures or
assert directly any other rights in respect of the Series A Subordinated
Debentures. The Bank of New York acts as the guarantee trustee under the Series
A Guarantee (the "Guarantee Trustee") and holds the Series A Guarantee for the
benefit of the holders of the Series A Preferred Securities. The Bank of New
York also acts as Debenture Trustee for the Series A Subordinated Debentures and
as Property Trustee, and The Bank of New York (Delaware) acts as Delaware
Trustee under the Trust Agreement. See "Description of the Series A Subordinated
Debentures--Enforcement of Certain Rights by Holders of the Series A Preferred
Securities", "Description of the Series A Subordinated Debentures--Debenture
Events of Default" and "Description of the Series A Guarantee". The Trust
Agreement provides that each holder of the Series A Preferred Securities by
acceptance thereof agrees to the provisions of the Series A Guarantee and the
Indenture.
Limited Voting Rights
Holders of the Series A Preferred Securities generally have limited voting
rights relating only to the modification of the Series A Preferred Securities
and the exercise of the Series A Issuer's rights as holder of the Series A
Subordinated Debentures and the Series A Guarantee. Holders of the Series A
Preferred Securities are not
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<PAGE>
entitled to vote to appoint, remove or replace the Property Trustee, the
Delaware Trustee or the Administrative Trustees, and such voting rights are
vested exclusively in the holder of the Series A Common Securities except, with
respect to the Property Trustee and the Delaware Trustee, upon the occurrence of
certain events described herein. The Property Trustee, the Administrative
Trustees and the Corporation may amend the Trust Agreement without the consent
of holders of the Series A Preferred Securities to ensure that the Series A
Issuer will be classified for United States federal income tax purposes as other
than an association taxable as a corporation unless such action materially and
adversely affects the interests of such holders. See "Description of the Series
A Preferred Securities--Voting Rights; Amendment of the Trust Agreement" and "--
Removal of the Series A Issuer Trustees".
No Prior Public Trading Market for Series A Preferred Securities
There currently is no public market for the Series A Preferred Securities and
there can be no assurance as to the liquidity of the market for the Series A
Preferred Securities, the ability of holders of the Series A Preferred
Securities to sell such Securities or the price at which holders would be able
to sell. Although the Corporation will use its reasonable best efforts to
maintain the effectiveness of a Shelf Registration Statement for resales during
the periods described herein, it will be entitled to restrict resales thereunder
for limited periods upon certain events. See "Registration Rights Agreement".
The Initial Purchasers have informed the Corporation that they intend to make a
market in the Series A Preferred Securities, to the extent permitted by
applicable law, but are under no obligation to do so. Any such market making may
be discontinued at any time without notice.
Market Prices
There can be no assurance as to the market prices for the Series A Preferred
Securities or Series A Subordinated Debentures that may be distributed in
exchange for Series A Preferred Securities if a liquidation of the Series A
Issuer occurs. Accordingly, the Series A Preferred Securities that an investor
may purchase, whether pursuant to the offer made hereby or in the secondary
market, or the Series A Subordinated Debentures that a holder of the Series A
Preferred Securities may receive on liquidation of the Series A Issuer, may
trade at a discount to the price that the investor paid to purchase the Series A
Preferred Securities offered hereby. In addition, the Series A Preferred
Securities may trade at prices that do not fully reflect the value of accrued
but unpaid interest with respect to the underlying Series A Subordinated
Debentures. A holder of Series A Preferred Securities that disposes of its
Series A Preferred Securities between record dates for payments of Distributions
(and consequently does not receive a Distribution from the Series A Issuer for
the period prior to such disposition) will nevertheless be required to include
accrued but unpaid interest on the Series A Subordinated Debentures through the
date of disposition in income as ordinary income and to add such amount to its
adjusted tax basis in the Series A Preferred Securities disposed of. Such holder
will recognize a capital loss to the extent the selling price (which may not
fully reflect the value of accrued but unpaid interest) is less than its
adjusted tax basis (which will include accrued but unpaid interest). Subject to
certain limited exceptions, capital losses cannot be applied to offset ordinary
income for United States federal income tax purposes. See "Certain Federal
Income Tax Consequences--Sales or Redemption of the Series A Preferred
Securities".
Possible Tax Law Changes Affecting the Series A Preferred Securities
On March 19, 1996, the Revenue Reconciliation Bill of 1996 (the "Bill") was
introduced in the 104th Congress which would have, among other things, generally
denied interest deductions for interest on an instrument, issued by a
corporation, that has a maximum term of more than 20 years and that is not shown
as indebtedness on the separate balance sheet of the issuer or, where the
instrument is issued to a related party (other than a corporation), where the
holder or some other related party issues a related instrument that is not shown
as indebtedness on the issuer's consolidated balance sheet. If such provision
were to have applied to the Series A Subordinated Debentures, the Corporation
would have been unable to deduct interest on the Series A Subordinated
Debentures. However, on March 29, 1996, the Chairmen of the Senate Finance and
House Ways and Means Committees issued a joint
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statement to the effect that it was their intention that the effective date of
the President's legislative proposals, if adopted, would be no earlier than the
date of appropriate Congressional action. Under current law, the Corporation
will be able to deduct interest on the Series A Subordinated Debentures.
President Clinton's proposed 1998 fiscal year budget reiterated a substantially
similar proposal on February 6, 1997. Although the 104th Congress adjourned
without enacting the Bill, there can be no assurance that legislation adopted by
the 105th Congress will not affect the ability of the Corporation to deduct
interest on the Series A Subordinated Debentures. Such a change could give rise
to a Tax Event, which would permit the Corporation, upon approval of the Federal
Reserve if then required under applicable capital guidelines or policies of the
Federal Reserve, to cause a redemption of the Series A Preferred Securities
before December 31, 2006. See "Description of the Series A Subordinated
Debentures--Optional Redemption" and "Description of the Series A Preferred
Securities--Redemption". See also "Certain Federal Income Tax Consequences--
Possible Tax Law Changes".
Residential and Commercial Real Estate Markets; Geographic Concentration
The Corporation has developed its lending business with a particular emphasis
on loans secured by residential real estate. The quality of the Corporation's
loan portfolio is dependent on the cash flow of borrowers, regional economic
conditions and residential and commercial real estate values. Adverse changes
affecting any of the above mentioned segments are likely to have an adverse
impact on the Corporation's loan portfolio and, as a result, the Corporation's
financial condition and results of operations may deteriorate.
Geographically, the Corporation's real estate loans are generally concentrated
in the Washington, D.C. metropolitan area. Geographic concentration of loans may
present risks in addition to those present with respect to loans generally. A
substantial deterioration in real estate values in the Washington, D.C.
metropolitan area could result in significant additional provisions to the
Corporation's reserve for loan losses.
Regulatory Capital Requirements
The Corporation and each of its banking subsidiaries are subject to regulatory
capital guidelines. Although the minimum leverage ratio requirement is 3.00%,
most bank holding companies, including the Corporation, are expected to maintain
an additional cushion of at least 100 to 200 basis points above the minimum.
However, the Federal Reserve may assign a specific capital ratio to an
individual bank holding company, including the Corporation, based on its
assessment of asset quality, earnings performance, interest-rate risk and
liquidity. As of the date of this Prospectus, the Federal Reserve has not
advised the Corporation of a specific leverage ratio requirement.
There can be no assurance that the Corporation or Riggs Bank will continue to
meet their respective minimum capital ratios. In the event that the Corporation
or any of its banking subsidiaries falls below the minimum capital requirements
described above, agencies may take regulatory action including, in the case of
subsidiary banks, "prompt corrective action". Such actions could impair the
Corporation's ability to make principal (or premium, if any) and interest
payments on the Series A Subordinated Debentures.
Competition
The Corporation competes with commercial banks, thrift institutions, mortgage
banks, credit unions and other institutions. Such competition is based primarily
on the scope and type of services offered, interest rates paid on deposits,
pricing of loans and the number and locations of branches. In addition,
competition has intensified in the Washington, D.C. metropolitan area. During
the past few years, significant consolidation among financial institutions in
the Washington, D.C. metropolitan area has occurred, including significant
acquisitions in this market by the Corporation's competitors, whose headquarters
are outside the Washington, D.C. metropolitan area. These competitors also
aggressively target many of the same customers as the Corporation, including
high net worth individuals and embassies and foreign missions. These competitors
and certain other competitors of the Corporation
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have substantially greater resources than the Corporation. Although management
believes the Corporation has been able to compete effectively in its market
areas, there can be no assurance that it will be able to continue to do so.
THE SERIES A ISSUER
Riggs Capital
Riggs Capital is a statutory business trust formed under Delaware law pursuant
to (i) the Trust Agreement executed by the Corporation, as depositor, The Bank
of New York, as Property Trustee, The Bank of New York (Delaware), as Delaware
Trustee, and the Administrative Trustees named therein and (ii) the filing of a
certificate of trust with the Delaware Secretary of State on November 15, 1996.
Prior to the issuance of the Series A Preferred Securities, the trust agreement
was amended and restated in its entirety as described herein (as so amended and
restated, the "Trust Agreement"). The Series A Issuer exists for the exclusive
purposes of (i) issuing and selling the Series A Securities, (ii) using the
proceeds from the sale of the Series A Securities to acquire Series A
Subordinated Debentures issued by the Corporation and (iii) engaging in only
those other activities necessary or incidental thereto (such as registering the
transfer of the Series A Securities). Accordingly, the Series A Subordinated
Debentures are the sole assets of the Series A Issuer, and payments under the
Series A Subordinated Debentures are the sole revenue of the Series A Issuer.
All of the Series A Common Securities are owned by the Corporation. The Series
A Common Securities rank pari passu, and payments will be made thereon pro rata,
with the Series A Preferred Securities, except that upon the occurrence and
continuance of an event of default under the Trust Agreement resulting from an
event of default under the Indenture, the rights of the Corporation as holder of
the Series A Common Securities to payment in respect of Distributions and
payments upon liquidation, redemption or otherwise will be subordinated to the
rights of the holders of the Series A Preferred Securities. See "Description of
the Series A Preferred Securities--Subordination of the Series A Common
Securities". The Corporation has acquired the Series A Common Securities in an
aggregate Liquidation Amount equal to at least 3% of the total capital of the
Series A Issuer. The Series A Issuer has a term of 55 years, but may terminate
earlier as provided in the Trust Agreement. The Series A Issuer's business and
affairs are conducted by its trustees, each appointed by the Corporation as
holder of the Series A Common Securities. The trustees for the Series A Issuer
are The Bank of New York, as the Property Trustee (the "Property Trustee"), The
Bank of New York (Delaware), as the Delaware Trustee (the "Delaware Trustee"),
and two individual trustees (the "Administrative Trustees") who are employees or
officers of or affiliated with the Corporation (collectively, the "Series A
Issuer Trustees"). The Bank of New York also acts as guarantee trustee under the
Series A Guarantee and the Indenture. See "Description of the Series A
Guarantee" and "Description of the Series A Subordinated Debentures". The holder
of the Series A Common Securities, or the holders of a majority in Liquidation
Amount of the Series A Preferred Securities if an event of default under the
Trust Agreement resulting from an event of default under the Indenture has
occurred and is continuing, will be entitled to appoint, remove or replace the
Property Trustee and/or the Delaware Trustee. In no event will the holders of
the Series A Preferred Securities have the right to vote to appoint, remove or
replace the Administrative Trustees; such voting rights are vested exclusively
in the holder of the Series A Common Securities. The duties and obligations of
the Series A Issuer Trustees are governed by the Trust Agreement. The
Corporation will pay all fees and expenses related to the Series A Issuer and
the offering of the Series A Preferred Securities and will pay, directly or
indirectly, all ongoing costs, expenses and liabilities of the Series A Issuer
pursuant to the Expense Agreement.
THE CORPORATION
Riggs National Corporation
The Corporation is a bank holding company registered under the BHCA. The
Corporation currently engages in a variety of banking-related activities through
its bank and non-bank subsidiaries. The Corporation currently has banking
operations or separate subsidiaries in the Washington, D.C. metropolitan area;
Miami, Florida; London,
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England; Paris, France; and Nassau, Bahamas. However, the primary market for the
Corporation is the Washington, D.C. metropolitan area, which it serves through
its primary banking subsidiary, Riggs Bank.
Key elements of the Corporation's business strategy for its subsidiaries are
to continue to focus on growth opportunities through the additional accumulation
of assets under management in its Financial Services Group, the orientation of
its retail banking branches toward money management relationships, the
development and specialization of products and services in specific growth
industries in its markets and the continued preeminence in the embassy banking
operations coupled with growth in selected international business lines. Such
growth will entail internally developed programs as well as possible alliances
or acquisitions in these areas. The Corporation will continue to serve the
varied financial needs of the Washington, D.C. metropolitan area and to meet its
commitments under the Community Reinvestment Act.
Riggs Bank
The Corporation's principal subsidiary is Riggs Bank, a national banking
association founded in 1836 and incorporated under the national banking laws of
the United States in 1896. In early 1996, the Corporation consolidated its three
separate banking subsidiaries: The Riggs National Bank of Washington, D.C., The
Riggs National Bank of Virginia and The Riggs National Bank of Maryland under
the name of Riggs Bank N.A.
Internally, Riggs Bank is organized into the following business lines: Retail
Banking Group; Corporate and Commercial Banking Group; Financial Services Group
and International Banking Group. Through these business lines Riggs Bank
provides a wide array of financial services to customers in the Washington, D.C.
metropolitan area, throughout the United States and internationally.
Riggs Bank's Retail Banking Group provides a variety of services including
checking, NOW, savings and money market accounts, loans and personal lines of
credit, certificates of deposit and individual retirement accounts.
Additionally, the Retail Banking Group provides 24-hour banking services through
its telebanking operations and a network of Riggs Bank automated teller machines
("ATMs") as well as national and regional ATM networks.
Riggs Bank's Corporate and Commercial Banking Groups provide services to
customers ranging from small regional businesses to major companies. These
services include lines of credit, secured and unsecured term loans, letters of
credit, credit support facilities, foreign currency transactions and cash
management.
Riggs Bank's Financial Services Group provides domestic trust, investment
management and private banking services. Fiduciary and administrative services
provided include financial management and tax planning for individuals,
investment and accounting services for corporations and non-profit
organizations, estate planning and trust administration, as well as bond
trusteeship.
Riggs Bank provides investment advisory services through Riggs Investment
Management Corporation, a wholly owned subsidiary incorporated under the laws of
the State of Delaware and registered under the Investment Advisers Act of 1940,
as amended.
Riggs Bank's International Banking Group furnishes a variety of financial
services, including issuing letters of credit in connection with trade and other
transactions, taking deposits, foreign exchange, private banking, cash
management, letters of credit and credit assistance with U.S. Government
programs. Customers include embassies and foreign missions in Washington, D.C.,
foreign governments, central banks and over 200 correspondent banks around the
world. These services are provided through both domestic and international
offices. Riggs Bank has established an important relationship with the foreign
embassy and mission community operating within the nation's capital. Currently,
Riggs Bank is the primary service provider to this distinguished group of
clientele, banking with 160 of the 170 countries represented by embassies or
missions in Washington, D.C. The embassy and mission business is a natural
complement to the Riggs Bank international private banking, foreign
correspondent banking and international advisory services.
The Riggs Bank and Trust Company (Bahamas) Limited, in Nassau, provides trust
services for international private banking customers. Riggs Bank operates a
branch in the U.S. Embassy in London, which services that
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embassy, its employees and official visitors. In 1991, Riggs Bank opened a
banking subsidiary under the laws of France. A full-service commercial bank, The
Riggs National Bank (Europe) S.A. ("Riggs-Europe") has one branch located in the
U.S. Embassy in Paris. In addition to serving that embassy, its employees and
official visitors, the Riggs-Europe office also assists the U.S. Government with
disbursement activities for the Department of Defense and the Department of
State for all of their facilities in Europe.
Riggs AP Bank Limited
Riggs AP Bank Limited ("Riggs AP"), a merchant bank located in London, is a
wholly owned subsidiary of Riggs Bank. Riggs AP provides traditional corporate
banking services, commercial property financing, private banking services and
trade finance.
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CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES (EXCLUDING PREFERRED STOCK
DIVIDENDS) AND RATIO OF EARNINGS TO COMBINED FIXED CHARGES
AND PREFERRED STOCK DIVIDEND REQUIREMENTS
The following are the consolidated ratio of earnings to fixed charges
(excluding preferred stock dividends) and ratio of earnings to combined fixed
charges and preferred stock dividend requirements for the Corporation for each
of the years in the five year period ended December 31, 1995 and the nine-month
period ended September 30, 1996:
<TABLE>
<CAPTION>
Nine Months
Ended Years Ended December 31,
September 30, ----------------------------------
1996 1995 1994 1993 1992 1991
------------- ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Earnings to Fixed Charges (Excluding
Preferred Stock Dividends):
Including Interest on Deposits.... 1.53 1.60 1.30 N/A N/A N/A
Excluding Interest on Deposits.... 3.42 3.61 2.15 N/A N/A N/A
Earnings to Combined Fixed Charges
and Preferred Stock Dividends
Including Interest on Deposits.... 1.42 1.49 1.17 N/A N/A N/A
Excluding Interest on Deposits.... 2.53 2.74 1.52 N/A N/A N/A
</TABLE>
The ratio of earnings to fixed charges (excluding preferred stock dividends)
is computed by dividing (i) income before income taxes and fixed charges less
interest capitalized during such period, net of amortization of previously
capitalized interest, by (ii) fixed charges. The ratio of earnings to combined
fixed charges and preferred stock dividend requirements is computed by dividing
(i) income before income taxes and fixed charges less interest capitalized
during such period, net of amortization of previously capitalized interest, by
(ii) fixed charges and preferred stock dividend requirements. Fixed charges
consist of interest expense on borrowings, including capitalized interest
(including or excluding deposits, as the case may be), and the portion of rental
expense which is deemed representative of interest. The preferred stock dividend
requirements represent the pre-tax earnings which would be required to cover
such dividend requirements on the Corporation's preferred stock outstanding.
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CAPITALIZATION
The following table sets forth the consolidated capitalization of the
Corporation as of September 30, 1996 and as adjusted to give effect to the
December Securities Sale. The following data should be read in conjunction with
the consolidated financial statements and notes thereto of the Corporation
incorporated by reference herein and deemed to be a part of this Prospectus.
<TABLE>
<CAPTION>
September 30, 1996
----------------------
Actual As Adjusted
----------------------
(in thousands)
<S> <C> <C>
Long-term Debt
9.65% Subordinated Debentures due 2009.......... $ 66,525 $ 66,525
8.50% Subordinated Debentures due 2006.......... 125,000 125,000
-------- --------
Total long-term debt..................... 191,525 191,525
-------- --------
Guaranteed Preferred Beneficial Interests in
Corporation's Junior Subordinated Deferrable Interest
Debentures (a)........................................ -- 150,000
-------- --------
Stockholders' Equity
Preferred Stock
$1.00 Par value, Shares authorized--25,000,000
Shares Issued--4,000,000 10.75% Noncumulative
Perpetual Preferred Stock, Series B
(liquidation amount $25 per share)............. 4,000 4,000
Class B Common Stock
$2.50 Par value, Shares authorized--20,000,000
Shares Issued--none............................. -- --
Common Stock
$2.50 Par value, Shares authorized--50,000,000
Shares Issued--31,263,994....................... 78,160 78,160
Surplus
Preferred Stock................................. 91,192 91,192
Common Stock.................................... 156,992 156,992
Foreign Exchange Translation Adjustments............... (1,164) (1,164)
Undivided Profits...................................... 111,668 111,668
Unrealized Gain (Loss) on Securities Available for
Sale, Net............................................. (4,815) (4,815)
Treasury Stock--900,798 Shares......................... (23,723) (23,723)
-------- --------
Total Stockholders' Equity............... 412,310 412,310
-------- --------
Total Long-Term Debt, Guaranteed Preferred Beneficial
Interests in Corporation's Junior Subordinated
Deferrable Interest Debentures and Stockholders'
Equity................................................. $603,835 $753,835
======== ========
Certain Capital Ratios:
Tier I Capital-Risk-Weighted.................... 15.71% 20.94%
Combined Tier I & II Capital-Risk-Weighted...... 24.26% 29.49%
Leverage........................................ 8.76% 11.57%
</TABLE>
(a) As described herein, the sole assets of the Series A Issuer are
approximately $154,640,000 aggregate principal amount of the 8 5/8% Junior
Subordinated Deferrable Interest Debentures, Series A, issued by the Corporation
to the Series A Issuer. The Series A Subordinated Debentures mature on December
31, 2026. The Corporation owns all of the Series A Common Securities of the
Series A Issuer.
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<PAGE>
USE OF PROCEEDS
Neither the Corporation nor the Series A Issuer will receive any of the
proceeds from the sale of the Series A Preferred Securities offered hereby, all
of which will be received by the Selling Securityholders.
All of the proceeds from the December Securities Sale of the Series A
Preferred Securities were invested, together with the proceeds from the sale of
the Series A Common Securities, by the Series A Issuer in Series A Subordinated
Debentures. The Corporation intends to use the proceeds from the sale of the
Series A Subordinated Debentures for general corporate purposes, including, but
not limited to, possible repurchase or redemption of shares of its currently
outstanding $100 million 10.75% Noncumulative Preferred Stock, which is first
redeemable on October 1, 1998.
FEDERAL RESERVE BOARD ACTIONS
On October 21, 1996 the Federal Reserve approved the use of certain cumulative
preferred stock instruments in Tier I capital for bank holding companies. Such
instruments are issued out of a special purpose subsidiary that is wholly owned
by the parent company and the proceeds are lent to the parent company in the
form of a very long-term, deeply subordinated note. Such arrangement, which
gives rise to minority interest upon consolidation of the subsidiary with the
parent holding company, normally will be accorded Tier I capital status by the
Federal Reserve. The Corporation believes that raising capital in this form is
the most efficient and cost effective method for it to do so.
ACCOUNTING TREATMENT
For financial reporting purposes, the Series A Issuer will be treated as a
subsidiary of the Corporation and, accordingly, the Series A Issuer's financial
statements will be included in the consolidated financial statements of the
Corporation. In all future reports of the Corporation filed under the Exchange
Act, the Series A Preferred Securities will be presented as a separate line item
in the consolidated balance sheets of the Corporation, entitled "Guaranteed
Preferred Beneficial Interests in Corporation's Junior Subordinated Deferrable
Interest Debentures" and appropriate disclosures about the Series A Preferred
Securities, the Series A Guarantee, the Expense Agreement and the Series A
Subordinated Debentures will be included in the notes to the consolidated
financial statements. For financial reporting purposes, the Corporation will
record Distributions payable on the Series A Preferred Securities as a deduction
from consolidated net income as a minority interest of a subsidiary.
DESCRIPTION OF THE SERIES A PREFERRED SECURITIES
General
The following is a summary of certain terms and provisions of the Series A
Preferred Securities. This summary of certain terms and provisions of the Series
A Preferred Securities does not purport to be complete and is subject to, and
qualified in its entirety by reference to, the Trust Agreement, including the
definitions therein of certain terms, and the Trust Indenture Act. All material
terms of the Series A Preferred Securities are set forth in the Prospectus.
Wherever particular defined terms of the Trust Agreement (as amended or
supplemented from time to time) are referred to herein, such defined terms are
incorporated herein by reference. The Trust Agreement has been filed as an
exhibit to the Registration Statement of which this Prospectus forms a part.
Distributions
The Series A Preferred Securities represent beneficial interests in the Series
A Issuer. Distributions on such Series A Preferred Securities will be payable at
the annual rate of 8 5/8% of the stated Liquidation Amount of $1,000, payable
semi-annually in arrears on June 30 and December 31 of each year, to the holders
of the Series A Preferred Securities on the relevant record dates. The record
dates will be, for so long as the Series A Preferred Securities
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remain in book-entry form, one Business Day (as defined below) prior to the
relevant Distribution payment date and, in the event the Series A Preferred
Securities are not in book-entry form, the 15th day of the month in which the
relevant Distribution payment date occurs. Subject to any applicable laws and
regulations and the provisions of the Trust Agreement, each such payment will be
made as described under "Book-Entry Issuance". Distributions will accumulate
from the date of original issuance of the Series A Preferred Securities. The
first Distribution payment date for the Series A Preferred Securities will be
June 30, 1997. The amount of Distributions payable for any period which is less
than a full Distribution Period will be computed on the basis of a 360-day year
of twelve 30-day months. In the event that any date on which Distributions are
payable on the Series A Preferred Securities is not a Business Day, then payment
of the Distributions payable on such date will be made on the next succeeding
day that is a Business Day (and without any additional Distributions or other
payment in respect of any such delay), except that, if such Business Day is in
the next succeeding calendar year, such payment shall be made on the immediately
preceding Business Day, in each case with the same force and effect as if made
on the date such payment was originally payable (each date on which
Distributions are payable in accordance with the foregoing, a "Distribution
Date"). A "Business Day" shall mean any day other than a Saturday or a Sunday,
or a day on which banking institutions in The City of New York are authorized or
required by law or executive order to remain closed or a day on which the
corporate trust office of the Property Trustee or the Debenture Trustee is
closed for business.
So long as no event of default under the Indenture has occurred and is
continuing, the Corporation has the right under the Indenture to defer the
payment of interest on the Series A Subordinated Debentures at any time or from
time to time for a period not exceeding 10 consecutive semi-annual periods with
respect to each Extension Period, provided that no Extension Period may extend
beyond the Stated Maturity of the Series A Subordinated Debentures. As a
consequence of any such deferral of interest, semi-annual Distributions on the
Series A Preferred Securities by the Series A Issuer will also be deferred
during any such Extension Period. Distributions to which holders of the Series A
Preferred Securities are entitled will accumulate additional Distributions
thereon at the rate per annum of 8 5/8% thereof, compounded semi-annually from
the relevant payment date for such Distributions. The term "Distributions" as
used herein shall include any such additional Distributions. During any such
Extension Period, the Corporation may not, and may not permit any subsidiary of
the Corporation to, (i) declare or pay any dividends or distributions on, or
redeem, purchase, acquire or make a liquidation payment with respect to, any of
the Corporation's capital stock, (ii) make any payment of principal, interest or
premium, if any, on or repay, repurchase or redeem any debt securities of the
Corporation that rank pari passu with or junior in interest to the Series A
Subordinated Debentures or (iii) make any guarantee payments with respect to any
guarantee by the Corporation of the debt securities of any subsidiary of the
Corporation if such guarantee ranks pari passu with or junior in interest to the
Series A Subordinated Debentures (other than (a) dividends or distributions in
common stock of the Corporation, (b) any declaration of a dividend in connection
with the implementation of a stockholders' rights plan, or the issuance of stock
under any such plan in the future or the redemption or repurchase of any such
rights pursuant thereto, (c) payments under the Series A Guarantee and (d)
purchases of common stock related to the issuance of common stock or rights
under any of the Corporation's benefit plans for its directors, officers or
employees). Prior to the termination of any such Extension Period, the
Corporation may further defer the payment of interest on the Series A
Subordinated Debentures, provided that no Extension Period may exceed 10
consecutive semi-annual periods or extend beyond the Stated Maturity of the
Series A Subordinated Debentures. Upon the termination of any such Extension
Period and the payment of all interest then accrued and unpaid (together with
interest thereon at the rate of 8 5/8%, compounded semi-annually, to the extent
permitted by applicable law), the Corporation may elect to begin a new Extension
Period. There is no limitation on the number of times that the Corporation may
elect to begin an Extension Period. See "Description of the Series A
Subordinated Debentures--Right to Defer Interest Payment Obligation" and
"Certain Federal Income Tax Consequences--Original Issue Discount".
The revenue of the Series A Issuer available for distribution to holders of
its Series A Preferred Securities is limited to payments under the Series A
Subordinated Debentures in which the Series A Issuer has invested the proceeds
from the issuance and sale of its Series A Securities. See "Description of the
Series A Subordinated Debentures". If the Corporation does not make interest
payments on the Series A Subordinated Debentures, the Property Trustee will not
have funds available to pay Distributions on the Series A Preferred Securities.
The payment of Distributions (if and to the extent the Series A Issuer has funds
legally available for the payment of such
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<PAGE>
Distributions and cash sufficient to make such payments) is guaranteed by the
Corporation on a limited basis as set forth herein under "Description of the
Series A Guarantee".
The Corporation has no current intention of exercising its right to defer
payments of interest on the Series A Subordinated Debentures.
Subordination of the Series A Common Securities
Payment of Distributions on, and the Redemption Price (as defined herein) of,
the Series A Preferred Securities and Series A Common Securities, as applicable,
shall be made pro rata based on the Liquidation Amount of the Series A Preferred
Securities and the Series A Common Securities; provided, however, that if on any
Distribution Date or Redemption Date an event of default under the Indenture
shall have occurred and be continuing, no payment of any Distribution on, or
Redemption Price of, any of the Series A Common Securities, and no other payment
on account of the redemption, liquidation or other acquisition of such Common
Securities, shall be made unless payment in full in cash of all accumulated and
unpaid Distributions on all of the outstanding Series A Preferred Securities for
all Distribution periods terminating on or prior thereto, or, in the case of
payment of the Redemption Price, the full amount of such Redemption Price on all
of the outstanding Series A Preferred Securities then called for redemption,
shall have been made or provided for, and all funds available to the Property
Trustee shall first be applied to the payment in full in cash of all
Distributions on, or Redemption Price of, the Series A Preferred Securities then
due and payable.
In the case of any event of default under the Trust Agreement resulting from
an event of default under the Indenture, the Corporation as holder of the Series
A Common Securities will be deemed to have waived any right to act with respect
to any such event of default under the Trust Agreement until the effect of all
such events of default with respect to the Series A Preferred Securities shall
have been cured, waived or otherwise eliminated. Until any such events of
default under the Trust Agreement shall have been so cured, waived or otherwise
eliminated, the Property Trustee shall act solely on behalf of the holders of
the Series A Preferred Securities and not on behalf of the Corporation as holder
of the Series A Common Securities, and only the holders of the Series A
Preferred Securities will have the right to direct the Property Trustee to act
on their behalf.
Redemption
The Series A Preferred Securities are subject to mandatory redemption, in
whole or in part, upon repayment of the Series A Subordinated Debentures at
their Stated Maturity (as defined herein) or earlier redemption as provided in
the Indenture. The proceeds from such repayment or redemption shall be applied
by the Property Trustee to redeem a Like Amount (as defined below) of the Series
A Preferred Securities, upon not less than 30 nor more than 60 days notice prior
to the date fixed for repayment or redemption, at a redemption price equal to
the aggregate Liquidation Amount of such Series A Preferred Securities plus
accumulated and unpaid Distributions thereon to the date of redemption (the
"Redemption Date") plus the related amount of the premium, if any, paid by the
Corporation upon the concurrent redemption of such Series A Subordinated
Debentures (the "Redemption Price"). For a description of the Stated Maturity
and redemption provisions of the Series A Subordinated Debentures, see
"Description of the Series A Subordinated Debentures--General", "--Optional
Redemption" and "--Tax Event or Capital Treatment Event Redemption".
Subject to the Corporation having received prior approval of the Federal
Reserve to do so if then required under applicable capital guidelines or
policies, the Corporation has the option to redeem the Series A Subordinated
Debentures prior to maturity on or after December 31, 2006, in whole at any time
or in part from time to time, at the Optional Redemption Price and thereby cause
a mandatory redemption of a Like Amount (as defined below) of the Series A
Preferred Securities. See "Description of the Series A Subordinated Debentures--
Optional Redemption".
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If, prior to December 31, 2006, a Tax Event or a Capital Treatment Event
shall occur and be continuing, the Corporation has the right, subject to the
Corporation having received prior approval of the Federal Reserve to do so if
then required under applicable capital guidelines or policies, to redeem the
Series A Subordinated Debentures in whole (but not in part) within 90 days after
the occurrence of such Tax Event or Capital Treatment Event at the Tax or
Capital Event Redemption Price and thereby cause a mandatory redemption of the
Series A Preferred Securities in whole (but not in part). See "Description of
the Series A Subordinated Debentures--Tax Event or Capital Treatment Event
Redemption".
Redemption Procedures
Series A Preferred Securities redeemed on each Redemption Date shall be
redeemed at the applicable Redemption Price with the applicable proceeds from
the contemporaneous redemption of a Like Amount of the Series A Subordinated
Debentures. Redemptions of the Series A Preferred Securities shall be made and
the Redemption Price shall be payable on each Redemption Date only to the extent
that the Series A Issuer has funds on hand available for the payment of such
Redemption Price. See also "--Subordination of the Series A Common Securities".
If the Series A Issuer gives a notice of redemption in respect of the
Series A Preferred Securities, then, by 12:00 noon, New York City time, on the
Redemption Date, to the extent funds are available, the Property Trustee will
deposit irrevocably with DTC funds sufficient to pay the applicable Redemption
Price and will give DTC irrevocable instructions and authority to pay the
Redemption Price to the holders of such Series A Preferred Securities. See
"Book-Entry Issuance". If any Series A Preferred Securities are held in
certificated form, the Property Trustee, to the extent funds are available, will
irrevocably deposit with the paying agent for the Series A Preferred Securities
funds sufficient to pay the applicable Redemption Price and will give such
paying agent irrevocable instructions and authority to pay the Redemption Price
to the holders thereof upon surrender of their certificates evidencing such
Series A Preferred Securities. Notwithstanding the foregoing, Distributions
payable on or prior to the Redemption Date for the Series A Preferred Securities
called for redemption shall be payable to the holders of the Series A Preferred
Securities on the relevant record dates for the related Distribution Dates. If
notice of redemption shall have been given and funds deposited as required, then
upon the date of such deposit, all rights of the holders of such Series A
Preferred Securities so called for redemption will cease, except the right of
the holders of such Series A Preferred Securities to receive the Redemption
Price, but without interest on such Redemption Price, and such Series A
Preferred Securities will cease to be outstanding.
In the event that any date fixed for redemption of the Series A
Preferred Securities is not a Business Day, then payment of the Redemption Price
payable on such date will be made on the next succeeding day which is a Business
Day (and without any interest or other payment in respect of any such delay),
except that, if such Business Day falls in the next calendar year, such payment
will be made on the immediately preceding Business Day. In the event that
payment of the Redemption Price in respect of the Series A Preferred Securities
called for redemption is improperly withheld or refused and not paid either by
the Series A Issuer or by the Corporation pursuant to the Series A Guarantee as
described under "Description of the Series A Guarantee", Distributions on such
Series A Preferred Securities will continue to accrue at the then applicable
rate, from the Redemption Date originally established by the Series A Issuer for
such Series A Preferred Securities to the date such Redemption Price is actually
paid, in which case the actual payment date will be the date fixed for
redemption for purposes of calculating the Redemption Price.
Subject to applicable law (including, without limitation, United States
federal securities law), the Corporation or its subsidiaries may at any time and
from time to time purchase outstanding Series A Preferred Securities by private
agreement.
Payment of the Redemption Price on the Series A Preferred Securities and
any distribution of the Series A Subordinated Debentures to holders of the
Series A Preferred Securities shall be made to the applicable recordholders
thereof as they appear on the register for the Series A Preferred Securities on
the relevant record date, which, for so long as the Series A Preferred
Securities are in book-entry form, shall be one Business Day prior to
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the relevant Redemption Date or liquidation date, as applicable; provided,
however, that in the event that any Series A Preferred Securities are not in
book-entry form, the relevant record date for the Series A Preferred Securities
shall be a date at least 15 days prior to the Redemption Date or liquidation
date, as applicable.
If less than all of the Series A Preferred Securities and Series A
Common Securities issued by the Series A Issuer are to be redeemed on a
Redemption Date, then the aggregate Liquidation Amount of the Series A Preferred
Securities and Series A Common Securities to be redeemed shall be allocated pro
rata to the Series A Preferred Securities and the Series A Common Securities
based upon the relative Liquidation Amounts of such classes. The particular
Series A Preferred Securities to be redeemed shall be selected on a pro rata
basis not more than 60 days prior to the Redemption Date by the Property Trustee
from the outstanding Series A Preferred Securities not previously called for
redemption, by such method as the Property Trustee shall deem fair and
appropriate and which may provide for the selection for redemption of portions
(equal to $1,000 or an integral multiple of $1,000 in excess thereof) of the
Liquidation Amount of the Series A Preferred Securities of a denomination larger
than $1,000. The Property Trustee shall promptly notify the trust registrar in
writing of the Series A Preferred Securities selected for redemption and, in the
case of the Series A Preferred Securities selected for partial redemption, the
Liquidation Amount thereof to be redeemed. For all purposes of the Trust
Agreement, unless the context otherwise requires, all provisions relating to the
redemption of the Series A Preferred Securities shall relate, in the case of the
Series A Preferred Securities redeemed or to be redeemed only in part, to the
portion of the aggregate Liquidation Amount of the Series A Preferred Securities
which has been or is to be redeemed.
Liquidation of the Series A Issuer and Distribution of the Series A Subordinated
Debentures to Holders
Subject to the Corporation having received the prior approval of the
Federal Reserve to do so if then required under applicable capital guidelines or
policies, the Corporation has the right at any time to terminate the Series A
Issuer and, after satisfaction of the liabilities of creditors of the Series A
Issuer as provided by applicable law, cause Series A Subordinated Debentures to
be distributed to the holders of the Series A Preferred Securities and Series A
Common Securities in exchange therefor upon liquidation of the Series A Issuer.
After the liquidation date fixed for any distribution of the Series A
Subordinated Debentures for Series A Preferred Securities (i) such Series A
Preferred Securities will no longer be deemed to be outstanding, (ii) DTC or its
nominee, as the record holder of the Series A Preferred Securities, will receive
a registered global certificate or certificates representing the Series A
Subordinated Debentures to be delivered upon such distribution and (iii) any
certificates representing such Series A Preferred Securities not held by DTC or
its nominee will be deemed to represent Series A Subordinated Debentures having
a principal amount equal to the stated Liquidation Amount of such Series A
Preferred Securities, and bearing accrued and unpaid interest in an amount equal
to the accumulated and unpaid Distributions on such series of the Series A
Preferred Securities until such certificates are presented to the Administrative
Trustees or their agent for transfer or reissuance.
Under current United States federal income tax law and interpretations,
a distribution of the Series A Subordinated Debentures should not be a taxable
event to holders of the Series A Preferred Securities. Should there be a change
in law, a change in legal interpretation, a Tax Event or other circumstances,
however, the distribution could be a taxable event to holders of the Series A
Preferred Securities. See "Certain Federal Income Tax Consequences--Distribution
of the Series A Subordinated Debentures to Holders of Series A Preferred
Securities".
Liquidation Distribution upon Termination
Pursuant to the Trust Agreement, the Series A Issuer shall automatically
terminate upon expiration of its term and shall terminate on the first to occur
of: (i) certain events of bankruptcy, dissolution or liquidation of the holder
of the Common Securities; (ii) the distribution of a Like Amount of the Series A
Subordinated Debentures to the holders of the Series A Preferred Securities, if
the Corporation, as depositor, has given written direction to the Property
Trustee to terminate the Series A Issuer (which direction is optional and wholly
within the discretion of the Corporation, as depositor); (iii) redemption of all
of the Series A Preferred Securities as described under
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"Description of the Series A Preferred Securities--Redemption"; and (iv) the
entry of an order for the dissolution of the Series A Issuer by a court of
competent jurisdiction.
If an early termination occurs as described in clause (i), (ii) or (iv)
above, the Series A Issuer shall be liquidated by the Series A Issuer Trustees
as expeditiously as the Series A Issuer Trustees determine to be possible by
distributing, after satisfaction of liabilities to creditors of the Series A
Issuer as provided by applicable law, to the holders of the Series A Preferred
Securities a Like Amount of the Series A Subordinated Debentures, unless such
distribution is determined by the Property Trustee not to be practical, in which
event such holders will be entitled to receive out of the assets of the Series A
Issuer available for distribution to holders, after satisfaction of liabilities
to creditors of the Series A Issuer as provided by applicable law, an amount
equal to the aggregate of the Liquidation Amount plus accrued and unpaid
Distributions on the Series A Preferred Securities, to the date of payment (such
amount being the "Liquidation Distribution"). If such Liquidation Distribution
can be paid only in part because the Series A Issuer has insufficient assets
available to pay in full the aggregate Liquidation Distribution, then the
amounts payable directly by the Series A Issuer on Series A Preferred Securities
shall be paid on a pro rata basis. The holder(s) of the Series A Common
Securities will be entitled to receive distributions upon any such liquidation
pro rata with the holders of the Series A Preferred Securities, except that if
an event of default under the Indenture has occurred and is continuing, the
Series A Preferred Securities shall have a priority over the Series A Common
Securities with respect to any such distributions.
Events of Default; Notice
Any one of the following events constitutes an "Event of Default" under
the Trust Agreement (an "Event of Default") with respect to the Series A
Preferred Securities issued thereunder (whatever the reason for such Event of
Default and whether it shall be voluntary or involuntary or be effected by
operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(i) the occurrence of an event of default under the Indenture (see
"Description of the Series A Subordinated Debentures--Debenture Events of
Default"); or
(ii) default by the Property Trustee in the payment of any Distribution
when it becomes due and payable, and continuation of such default for a period
of 30 days; or
(iii) default by the Property Trustee in the payment of any Redemption
Price of any Series A Preferred Security when it becomes due and payable; or
(iv) default in the performance, or breach, in any material respect, of
any covenant or warranty of the Series A Issuer Trustees in the Trust Agreement
(other than a covenant or warranty a default in the performance of which or the
breach of which is dealt with in clause (ii) or (iii) above), and continuation
of such default or breach for a period of 60 days after there has been given, by
registered or certified mail, to the defaulting Series A Issuer Trustee or
Trustees by the holders of at least 25% in aggregate Liquidation Amount of the
outstanding Series A Preferred Securities, a written notice specifying such
default or breach and requiring it to be remedied and stating that such notice
is a "Notice of Default" under the Trust Agreement; or
(v) the occurrence of certain events of bankruptcy or insolvency with
respect to the Property Trustee and the failure by the Corporation to appoint a
successor Property Trustee within 60 days thereof.
Within five Business Days after the occurrence of any Event of Default
actually known to the Property Trustee, the Property Trustee shall transmit
notice of such Event of Default to the holders of the Series A Preferred
Securities, the Administrative Trustees and the Corporation, as depositor,
unless such Event of Default shall have been cured or waived. The Corporation,
as depositor, and the Administrative Trustees are required to file annually with
the Property Trustee a certificate as to whether or not they are in compliance
with all the conditions and covenants applicable to them under the Trust
Agreement.
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If an event of default under the Indenture has occurred and is
continuing, the Series A Preferred Securities shall have a preference over the
Series A Common Securities as described above. See "--Subordination of the
Series A Common Securities" and "--Liquidation Distribution Upon Termination".
The existence of an event of default does not entitle the holders of the Series
A Preferred Securities to accelerate the maturity thereof.
Removal of the Series A Issuer Trustees
Unless an event of default under the Indenture shall have occurred and
be continuing, any Series A Issuer Trustee may be removed at any time by the
holder of the Series A Common Securities. If an event of default under the
Indenture has occurred and is continuing, the Property Trustee and the Delaware
Trustee may be removed at such time by the holders of a majority in Liquidation
Amount of the outstanding Series A Preferred Securities. In no event will the
holders of the Series A Preferred Securities have the right to vote to appoint,
remove or replace the Administrative Trustees, which voting rights are vested
exclusively in the Corporation as the holder of the Series A Common Securities.
No resignation or removal of any Series A Issuer Trustee and no appointment of a
successor trustee shall be effective until the acceptance of appointment by the
successor trustee in accordance with the provisions of the Trust Agreement.
Co-trustees and Separate Property Trustee
Unless an Event of Default shall have occurred and be continuing, at any
time or times, for the purpose of meeting the legal requirements of the Trust
Indenture Act, if applicable, or of any jurisdiction in which any part of the
Trust Property may at the time be located, the Corporation, as the holder of the
Series A Common Securities, and the Administrative Trustees shall have power to
appoint one or more persons either to act as a co-trustee, jointly with the
Property Trustee, of all or any part of such Trust Property, or to act as
separate trustee of any such property, in either case with such powers as may be
provided in the instrument of appointment, and to vest in such person or persons
in such capacity any property, title, right or power deemed necessary or
desirable, subject to the provisions of the Trust Agreement. In the event an
event of default under the Indenture has occurred and is continuing, the
Property Trustee alone shall have power to make such appointment.
Merger or Consolidation of the Series A Issuer Trustees
Any corporation into which the Property Trustee, the Delaware Trustee or
any Administrative Trustee that is not a natural person may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Trustee shall be a
party or any corporation succeeding to all or substantially all the corporate
trust business of such Trustee, shall be the successor of such Trustee under the
Trust Agreement, provided such corporation shall be otherwise qualified and
eligible.
Mergers, Consolidations, Amalgamations or Replacements of the Series A Issuer
The Series A Issuer may not merge with or into, consolidate, amalgamate,
be replaced by, convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other Person, except as
described below. The Series A Issuer may, at the request of the Corporation,
with the consent of the Administrative Trustees and without the consent of the
holders of the Series A Preferred Securities or any other trustee merge with or
into, consolidate, amalgamate, be replaced by, convey, transfer or lease its
properties and assets substantially as an entirety to, a trust organized as such
under the laws of any State; provided that (i) such successor entity either (a)
expressly assumes all of the obligations of the Series A Issuer with respect to
the Series A Preferred Securities or (b) substitutes for the Series A Preferred
Securities other securities having substantially the same terms as the Series A
Preferred Securities (the "Successor Securities") so long as the Successor
Securities rank the same as the Series A Preferred Securities in priority with
respect to Distributions and payments upon liquidation, redemption and
otherwise, (ii) the Corporation expressly appoints a trustee of such successor
entity possessing the same powers and
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duties as the Property Trustee as the holder of the Series A Subordinated
Debentures, (iii) the Successor Securities are registered or listed, or any
Successor Securities will be registered or listed upon notification of issuance,
on any national securities exchange or other organization on which the Series A
Preferred Securities are then registered or listed, if any, (iv) such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease does not
cause the Series A Preferred Securities (including any Successor Securities) to
be downgraded by any nationally recognized statistical rating organization, (v)
such merger, consolidation, amalgamation, replacement, conveyance, transfer or
lease does not adversely affect the rights, preferences and privileges of the
holders of the Series A Preferred Securities (including any Successor
Securities) in any material respect, (vi) such successor entity has a purpose
identical to that of the Series A Issuer, (vii) prior to such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease, the
Corporation has received an opinion from independent counsel to the Series A
Issuer experienced in such matters to the effect that (a) such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease does not
adversely affect the rights, preferences and privileges of the holders of the
Series A Preferred Securities (including any Successor Securities) in any
material respect and (b) following such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, (1) neither the Series A Issuer nor
such successor entity will be required to register as an investment company
under the Investment Company Act of 1940, as amended (the "Investment Company
Act"), and (2) the Series A Issuer or the successor entity, as the case may be,
will continue to be classified other than as an association taxable as a
corporation for United States federal income tax purposes; and (viii) the
Corporation or any permitted successor or assignee owns all of the Series A
Common Securities of such successor entity and guarantees the obligations of
such successor entity under the Successor Securities at least to the extent
provided by the Series A Guarantee. Notwithstanding the foregoing, the Series A
Issuer shall not, except with the consent of holders of 100% in Liquidation
Amount of the Series A Preferred Securities, consolidate, amalgamate, merge with
or into or be replaced by or convey, transfer or lease its properties and assets
substantially as an entirety to any other entity or permit any other entity to
consolidate, amalgamate, merge with or into, or replace it if such
consolidation, amalgamation, merger, replacement, conveyance, transfer or lease
would cause the Series A Issuer or the successor entity to be classified as an
association taxable as a corporation or as other than a grantor trust for United
States federal income tax purposes.
Voting Rights; Amendment of the Trust Agreement
Except as provided below and under "Description of the Series A
Guarantee--Amendments and Assignment" and as otherwise required by law and the
Trust Agreement, the holders of the Series A Preferred Securities have no voting
rights.
The Trust Agreement may be amended from time to time by the Corporation,
the Property Trustee and the Administrative Trustees, without the consent of the
holders of the Series A Preferred Securities, to (i) cure any ambiguity, correct
or supplement any provisions in the Trust Agreement that may be inconsistent
with any other provision or to make any other provisions with respect to matters
or questions arising under the Trust Agreement, which shall not be inconsistent
with the other provisions of the Trust Agreement or (ii) modify, eliminate or
add to any provisions of the Trust Agreement to such extent as shall be
necessary to ensure that the Series A Issuer will be classified for United
States federal income tax purposes as other than an association taxable as a
corporation at all times that the Series A Preferred Securities are outstanding
or to ensure that the Series A Issuer will not be required to register as an
"investment company" under the Investment Company Act; provided that such action
shall not adversely affect in any material respect the interests of any holder
of the Series A Preferred Securities, and any amendments of the Trust Agreement
shall become effective when notice thereof is given to the holders of the Series
A Preferred Securities. The Trust Agreement may be amended by the Administrative
Trustees and the Corporation with (i) the consent of holders representing not
less than a majority (based upon Liquidation Amounts) of the outstanding Series
A Preferred Securities and (ii) receipt by the Series A Issuer Trustees of an
opinion of counsel to the effect that such amendment or the exercise of any
power granted to the Series A Issuer Trustees in accordance with such amendment
will not affect the Series A Issuer's status as a grantor trust for United
States federal income tax purposes or the Series A Issuer's exemption from
status as an "investment company" under the Investment Company Act, provided
that without the consent of each holder of the Series A Preferred Securities,
the Trust Agreement may not be amended to (a) change the amount or timing of any
Distribution on the Series A Preferred Securities or otherwise adversely affect
the amount of any Distribution required to be made in respect of the Series
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A Preferred Securities as of a specified date or (b) restrict the right of a
holder of the Series A Preferred Securities to institute suit for the
enforcement of any such payment on or after such date.
So long as the Series A Subordinated Debentures are held by the Property
Trustee, the Series A Issuer Trustees shall not (i) direct the time, method and
place of conducting any proceeding for any remedy available to the Debenture
Trustee or executing any trust or power conferred on the Property Trustee with
respect to the Series A Subordinated Debentures, (ii) waive any past default
that is available under the Indenture, (iii) exercise any right to rescind or
annul a declaration that the principal of all the Series A Subordinated
Debentures shall be due and payable or (iv) consent to any amendment,
modification or termination of the Indenture or the Series A Subordinated
Debentures, where such consent shall be required, without, in each case,
obtaining the prior approval of the holders of a majority in aggregate
Liquidation Amount of all outstanding Series A Preferred Securities; provided,
however, that where a consent under the Indenture would require the consent of
each holder of the Series A Subordinated Debentures affected thereby, no such
consent shall be given by the Property Trustee without the prior consent of each
holder of the Series A Preferred Securities. The Series A Issuer Trustees shall
not revoke any action previously authorized or approved by a vote of the holders
of the Series A Preferred Securities except by subsequent vote of the holders of
the Series A Preferred Securities. The Property Trustee shall notify each holder
of the Series A Preferred Securities of any notice of default which it receives
with respect to the Series A Subordinated Debentures. In addition to obtaining
the foregoing approvals of the holders of the Series A Preferred Securities,
prior to taking any of the foregoing actions, the Series A Issuer Trustees shall
obtain an opinion of counsel experienced in such matters to the effect that the
Series A Issuer will not be classified as an association taxable as a
corporation or as other than a grantor trust for United States federal income
tax purposes on account of such action.
Any required approval of holders of the Series A Preferred Securities
may be given at a meeting of holders of the Series A Preferred Securities
convened for such purpose or pursuant to written consent. The Property Trustee
will cause a notice of any meeting at which holders of the Series A Preferred
Securities are entitled to vote, or of any matter upon which action by written
consent of such holders is to be taken, to be given to each holder of record of
the Series A Preferred Securities in the manner as set forth in the Trust
Agreement.
No vote or consent of the holders of the Series A Preferred Securities
will be required for the Series A Issuer to redeem and cancel the Series A
Preferred Securities in accordance with the Trust Agreement.
Notwithstanding that holders of the Series A Preferred Securities are
entitled to vote or consent under any of the circumstances described above, any
of the Series A Preferred Securities that are owned by the Corporation, the
Series A Issuer Trustees or any affiliate of the Corporation or the Series A
Issuer Trustees shall, for purposes of such vote or consent, be treated as if
they were not outstanding.
Liquidation Value
The amount payable on the Series A Preferred Securities in the event of
any liquidation of the Series A Issuer is $1,000 per Series A Preferred Security
plus accumulated and unpaid Distributions, which may be in the form of a
distribution of such amount in Series A Subordinated Debentures, subject to
certain exceptions. See "--Liquidation Distribution Upon Termination".
Payment and Paying Agency
Payments in respect of the Global Series A Preferred Securities (as
defined herein) shall be made to DTC, which shall credit the relevant accounts
at the Depositary on the applicable Distribution Dates. Payments in respect of
Series A Preferred Securities which are not held by DTC shall be made by check
mailed to the address of the holder entitled thereto as such address shall
appear on the register maintained by the Property Trustee. The paying agent (the
"Paying Agent") is the Property Trustee and any co-paying agent chosen by the
Property Trustee and acceptable to the Administrative Trustees and the
Corporation. The Paying Agent is permitted to resign as Paying Agent upon 30
days' written notice to the Property Trustee and the Corporation. In the event
that the Property
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Trustee shall no longer be the Paying Agent, the Administrative Trustees shall
appoint a successor (which shall be a bank or trust company acceptable to the
Administrative Trustees and the Corporation) to act as Paying Agent.
Registrar and Transfer Agent
The Property Trustee acts as registrar and transfer agent for the Series
A Preferred Securities.
Registration of transfers of the Series A Preferred Securities will be
effected without charge by or on behalf of the Series A Issuer, but upon payment
of any tax or other governmental charges that may be imposed in connection with
any transfer or exchange. The Series A Issuer will not be required (i) to
register or cause to be registered the transfer or exchange of the Series A
Preferred Securities during a period beginning at the opening of business 15
days before the day of the mailing of the relevant notice of redemption and
ending at the close of business on the day of mailing of such notice of
redemption or (ii) to register or cause to be registered the transfer or
exchange of any Series A Preferred Securities so selected for redemption,
except, in the case of any Series A Preferred Securities being redeemed in part,
any portion thereof not to be redeemed.
Information Concerning the Property Trustee
The Property Trustee, other than during the occurrence and continuance
of an Event of Default, undertakes to perform only such duties as are
specifically set forth in the Trust Agreement and, after such Event of Default,
must exercise the same degree of care and skill as a prudent person would
exercise or use in the conduct of his or her own affairs. Subject to this
provision, the Property Trustee is under no obligation to exercise any of the
powers vested in it by the Trust Agreement at the request of any holder of the
Series A Preferred Securities unless it is offered reasonable indemnity against
the costs, expenses and liabilities that might be incurred thereby. If no Event
of Default has occurred and is continuing and the Property Trustee is required
to decide between alternative causes of action, construe ambiguous provisions in
the Trust Agreement or is unsure of the application of any provision of the
Trust Agreement, and the matter is not one on which holders of the Series A
Preferred Securities are entitled under the Trust Agreement to vote, then the
Property Trustee shall take such action as is directed by the Corporation and if
not so directed, shall take such action as it deems advisable and in the best
interests of the holders of the Series A Securities and will have no liability
except for its own bad faith, negligence or willful misconduct.
Miscellaneous
The Administrative Trustees are authorized and directed to conduct the
affairs of and to operate the Series A Issuer in such a way that the Series A
Issuer will not be deemed to be an "investment company" required to be
registered under the Investment Company Act or classified as an association
taxable as a corporation for United States federal income tax purposes and so
that the Series A Subordinated Debentures are treated as indebtedness of the
Corporation for United States federal income tax purposes. In this connection,
the Corporation and the Administrative Trustees are authorized to take any
action, not inconsistent with applicable law, the certificate of trust or the
Trust Agreement, that the Corporation and the Administrative Trustees determine
in their discretion to be necessary or desirable for such purposes, as long as
such action does not materially adversely affect the interests of the holders of
the Series A Preferred Securities.
Holders of the Series A Preferred Securities have no preemptive or
similar rights.
The Series A Issuer may not borrow money or issue debt or mortgage or
pledge any of its assets.
DESCRIPTION OF THE SERIES A SUBORDINATED DEBENTURES
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The Series A Subordinated Debentures have been issued under an Indenture
(the "Indenture") between the Corporation and The Bank of New York, as trustee
(the "Debenture Trustee"). This summary of certain terms and provisions of the
Series A Subordinated Debentures and the Indenture does not purport to be
complete and is subject to, and is qualified in its entirety by reference to,
the Indenture, the form of which is available from the Corporation. All material
terms of the Series A Subordinated Debentures are set forth in this Prospectus.
General
Concurrently with the issuance of the Series A Preferred Securities in
the December Securities Sale, the Series A Issuer invested the proceeds thereof,
together with the consideration paid by the Corporation for the Series A Common
Securities, in the Series A Subordinated Debentures issued by the Corporation.
The Series A Subordinated Debentures bear interest at the annual rate of 8/5//8%
of the principal amount thereof, payable semi-annually in arrears on June 30 and
December 31 of each year (each, an "Interest Payment Date"), commencing June 30,
1997, to the person in whose name each Series A Subordinated Debenture is
registered, subject to certain exceptions, at the close of business on the
Business Day next preceding such Interest Payment Date. It is anticipated that,
until the liquidation, if any, of the Series A Issuer, the Series A Subordinated
Debentures will be held in the name of the Property Trustee in trust for the
benefit of the holders of the Series A Preferred Securities. The amount of
interest payable for any period less than a full interest period will be
computed on the basis of a 360-day year of twelve 30-day months. In the event
that any date on which interest is payable on the Series A Subordinated
Debentures is not a Business Day, then payment of the interest payable on such
date will be made on the next succeeding day that is a Business Day (and without
any interest or other payment in respect of any such delay), except that, if
such Business Day is in the next succeeding calendar year, such payment shall be
made on the immediately preceding Business Day, in each case with the same force
and effect as if made on the date such payment was originally payable. Accrued
interest that is not paid on the applicable Interest Payment Date will bear
additional interest on the amount thereof (to the extent permitted by law) at
the rate per annum of 8/5//8% thereof, compounded semi-annually from the
relevant Interest Payment Date. The term "interest" as used herein shall include
semi-annual interest payments, interest on semi-annual interest payments not
paid on the applicable Interest Payment Date and Additional Sums, as applicable.
See "--Additional Sums" below.
The Series A Subordinated Debentures will mature on December 31, 2026
(the "Stated Maturity").
The Series A Subordinated Debentures are unsecured and rank junior and
are subordinate in right of payment to all Senior Debt of the Corporation.
Because the Corporation is a holding company, the right of the Corporation to
participate in any distribution of assets of any subsidiary, including Riggs
Bank, upon such subsidiary's liquidation or reorganization or otherwise, is
subject to the prior claims of creditors of that subsidiary, except to the
extent that the Corporation may itself be recognized as a creditor of that
subsidiary. Accordingly, the Series A Subordinated Debentures are effectively
subordinated to all existing and future liabilities of the Corporation's
subsidiaries, and holders of the Series A Subordinated Debentures should look
only to the assets of the Corporation for payments on the Series A Subordinated
Debentures. The Indenture does not limit the incurrence or issuance of other
secured or unsecured debt of the Corporation, including Senior Debt, whether
under the Indenture or any existing or other indenture that the Corporation may
enter into in the future or otherwise.
The Corporation is a legal entity separate and distinct from its banking
and other subsidiaries. A major portion of the Corporation's revenues results
from amounts paid as dividends to the Corporation by its national bank
subsidiary, Riggs Bank. The prior approval of the OCC is required if the total
of all dividends declared by a national bank in any calendar year will exceed
the sum of such bank's net profits for that year and its retained net profits
for the preceding two calendar years, less any required transfers to surplus.
Federal law also prohibits any national bank from paying dividends which would
be greater than such bank's undivided profits after deducting statutory bad
debts in excess of such bank's allowance for loan losses.
In addition, the Corporation and its national bank subsidiary are
subject to various general regulatory policies and requirements relating to the
payment of dividends, including requirements to maintain adequate capital above
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regulatory minimums. The appropriate federal regulatory authority is authorized
to determine under certain circumstances relating to the financial condition of
a national bank or bank holding company that the payment of dividends would be
an unsafe or unsound practice and to prohibit payment thereof. The OCC and the
Federal Deposit Insurance Corporation (the "FDIC") have indicated that paying
dividends that deplete a bank's capital base to an inadequate level would be an
unsound and unsafe banking practice. The OCC, the FDIC and the Federal Reserve
have each indicated that banking organizations should generally pay dividends
only out of current operating earnings.
Right to Defer Interest Payment Obligation
So long as no event of default under the Indenture has occurred and is
continuing, the Corporation has the right under the Indenture at any time during
the term of the Series A Subordinated Debentures to defer the payment of
interest on the Series A Subordinate Debentures for a period not exceeding 10
consecutive semi-annual periods with respect to each Extension Period, provided
that no Extension Period may extend beyond the Stated Maturity of the Series A
Subordinated Debentures. At the end of such Extension Period, the Corporation
must pay all interest then accrued and unpaid on the Series A Subordinate
Debentures (together with interest on such unpaid interest at the annual rate of
8/5//8%, compounded semi-annually from the relevant Interest Payment Date, to
the extent permitted by applicable law). During an Extension Period, interest
will continue to accrue and holders of the Series A Subordinated Debentures (or
holders of the Series A Preferred Securities while outstanding) will be required
to accrue interest income for United States federal income tax purposes. See
"Certain Federal Income Tax Consequences--Original Issue Discount".
During any such Extension Period, the Corporation may not, and may not
permit any subsidiary of the Corporation to, (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire or make a liquidation payment
with respect to, any of the Corporation's capital stock or (ii) make any payment
of principal, interest or premium, if any, on or repay, repurchase or redeem any
debt securities of the Corporation that rank pari passu with or junior in
interest to the Series A Subordinated Debentures or make any guarantee payments
with respect to any guarantee by the Corporation of the debt securities of any
subsidiary of the Corporation if such guarantee ranks pari passu with or junior
in interest to the Series A Subordinated Debentures (other than (a) dividends or
distributions in common stock of the Corporation, (b) any declaration of a
dividend in connection with the implementation of a stockholders' rights plan,
the issuance of stock under any such plan in the future or the redemption or
repurchase of any such rights pursuant thereto, (c) payments under the Series A
Guarantee and (d) purchases of common stock related to the issuance of common
stock or rights under any of the Corporation's benefit plans for its directors,
officers or employees). Prior to the termination of any such Extension Period,
the Corporation may further defer the payment of interest, provided that no
Extension Period may exceed 10 consecutive semi-annual periods or extend beyond
the Stated Maturity of the Series A Subordinated Debentures. Upon the
termination of any such Extension Period and the payment of all interest then
accrued and unpaid (together with interest thereon at the annual rate of
8/5//8%, compounded semi-annually, to the extent permitted by applicable law),
the Corporation may elect to begin a new Extension Period subject to the above
requirements. No interest shall be due and payable during an Extension Period,
except at the end thereof. The Corporation must give the Property Trustee, the
Administrative Trustees and the Debenture Trustee notice of its election of such
Extension Period at least one Business Day prior to the earlier of (i) the date
interest on the Series A Subordinated Debentures would have been payable except
for the election to begin such Extension Period or (ii) the date the
Administrative Trustees are required to give notice to DTC or to holders of the
Series A Preferred Securities of the record date for such Distribution or the
date such Distributions are payable, but in any event not less than one Business
Day prior to such record date. The Debenture Trustee shall give notice of the
Corporation's election to begin a new Extension Period to the holders of the
Series A Subordinated Debentures. There is no limitation on the number of times
that the Corporation may elect to begin an Extension Period.
Additional Sums
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If the Series A Issuer is required to pay any additional taxes, duties
or other governmental charges as a result of a Tax Event, the Corporation will
pay as additional amounts on the Series A Subordinated Debentures such amounts
("Additional Sums") as shall be required so that the Distributions payable by
the Series A Issuer shall not be reduced as a result of any such additional
taxes, duties or other governmental charges.
Optional Redemption
The Series A Subordinated Debentures are redeemable, in whole at any
time or in part from time to time, at the option of the Corporation on or after
December 31, 2006, subject to the Corporation having received prior approval of
the Federal Reserve if then required under applicable capital guidelines or
policies, at a redemption price (the "Optional Redemption Price") equal to the
percentage of the outstanding principal amount of the Series A Subordinated
Debentures specified below, plus, in each case, accrued interest thereon to the
date of redemption, if redeemed during the 12-month period beginning December
31, in the year indicated:
Optional
--------
Date Redemption Price
---- ----------------
2006.................. 104.313%
2007.................. 103.881%
2008.................. 103.450%
2009.................. 103.019%
2010.................. 102.588%
2011.................. 102.156%
2012.................. 101.725%
2013.................. 101.294%
2014.................. 100.863%
2015.................. 100.431%
2016 and thereafter .. 100.000%
Tax Event or Capital Treatment Event Redemption
If a Tax Event or a Capital Treatment Event (as defined below) shall
occur and be continuing, the Corporation may, at its option and subject to
receipt of prior approval by the Federal Reserve if then required under
applicable capital guidelines or policies, redeem the Series A Subordinated
Debentures in whole (but not in part) at any time within 90 days following the
occurrence of such Tax Event or Capital Treatment Event, at a redemption price
(the "Tax or Capital Event Redemption Price") equal to the Make-Whole Amount
plus, in each case, accrued and unpaid interest on the Series A Subordinated
Debentures to the date fixed for redemption. The "Make-Whole Amount" shall be
equal to the greater of (i) 100% of the principal amount of the Series A
Subordinated Debentures or (ii) as determined by a Quotation Agent (as defined
below), the sum of the present values of the principal amount and premium
payable as part of the Optional Redemption Price with respect to an optional
redemption of such Series A Subordinated Debentures on December 31, 2006,
together with scheduled payments of interest from the Redemption Date to
December 31, 2006 (the "Remaining Life"), in each case discounted to the
Redemption Date on a semi-annual basis (assuming a 360-day year consisting of
30-day months) at the Adjusted Treasury Rate.
"Adjusted Treasury Rate" means, with respect to any redemption date, the
Treasury Rate plus (i) 1.70% if such Redemption Date occurs on or before
December 31, 1997 or (ii) 0.95% if such Redemption Date occurs after December
31, 1997.
"Treasury Rate" means (i) the yield, under the heading which represents
the average for the immediately prior week, appearing in the most recently
published statistical release designated "H.15(519)" or any successor
publication which is published weekly by the Federal Reserve and which
establishes yields on actively traded United
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States Treasury securities adjusted to constant maturity under the caption
"Treasury Constant Maturities", for the maturity corresponding to the Remaining
Life (if no maturity is within three months before or after the Remaining Life,
yields for the two published maturities most closely corresponding to the
Remaining Life shall be determined and the Treasury Rate shall be interpolated
or extrapolated from such yields on a straight-line basis, rounding to the
nearest month) or (ii) if such release (or any successor release) is not
published during the week preceding the calculation date or does not contain
such yields, the rate per annum equal to the semi-annual equivalent yield to
maturity of the Comparable Treasury Issue, calculated using a price for the
Comparable Treasury Issue (expressed as a percentage of its principal amount)
equal to the Comparable Treasury Price for such Redemption Date. The Treasury
Rate shall be calculated on the third Business Day preceding the Redemption
Date.
"Comparable Treasury Issue" means with respect to any Redemption Date
the United States Treasury security selected by the Quotation Agent as having a
maturity comparable to the Remaining Life that would be utilized, at the time of
selection and in accordance with customary financial practice, in pricing new
issues of corporate debt securities of comparable maturity to the Remaining
Life. If no United States Treasury security has a maturity which is within a
period from three months before to three months after December 31, 2006, the two
most closely corresponding United States Treasury securities shall be used as
the Comparable Treasury Issue, and the Treasury Rate shall be interpolated or
extrapolated on a straight-line basis, rounding to the nearest month using such
securities.
"Quotation Agent" means Dillon, Read & Co. Inc. and its respective
successors; provided, however, that if the foregoing shall cease to be a primary
U.S. Government securities dealer in New York City (a "Primary Treasury
Dealer"), the Corporation shall substitute therefor another Primary Treasury
Dealer. "Reference Treasury Dealer" means (i) the Quotation Agent and (ii) any
other Primary Treasury Dealer selected by the Debenture Trustee after
consultation with the Corporation.
"Comparable Treasury Price" means (A) the average of five Reference
Treasury Dealer Quotations for such Redemption Date, after excluding the highest
and lowest such Reference Treasury Dealer Quotations, or (B) if the Debenture
Trustee obtains fewer than three such Reference Treasury Dealer Quotations, the
average of all such Quotations.
"Reference Treasury Dealer Quotations" means, with respect to each
Reference Treasury Dealer and any Redemption Date, the average, as determined by
the Debenture Trustee, of the bid and asked prices for the Comparable Treasury
Issue (expressed in each case as a percentage of its principal amount) quoted in
writing to the Debenture Trustee by such Reference Treasury Dealer at 5:00 p.m.,
New York City time, on the third Business Day preceding such Redemption Date.
"Tax Event" means the receipt by the Series A Issuer of an opinion of
counsel experienced in such matters to the effect that, as a result of any
amendment to, or change (including any announced prospective change) in, the
laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein, or as a result of any
official administrative pronouncement or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
which pronouncement or decision is announced on or after the date of issuance of
such Series A Preferred Securities under the Trust Agreement, there is more than
an insubstantial risk that (i) the Series A Issuer is, or will be within 90 days
of the date of such opinion, subject to United States federal income tax with
respect to income received or accrued on the Series A Subordinated Debentures,
(ii) interest payable by the Corporation on the Series A Subordinated Debentures
is not, or within 90 days of such the date of opinion, will not be, deductible
by the Corporation, in whole or in part, for United States federal income tax
purposes or (iii) the Series A Issuer is, or will be within 90 days of the date
of the opinion, subject to more than a de minimis amount of other taxes, duties
or other governmental charges.
"Capital Treatment Event" means the reasonable determination by the
Corporation that, as a result of the occurrence of any amendment to, or change
(including any announced prospective change) in, the laws (or any regulations
thereunder) of the United States or any political subdivision thereof or
therein, or as a result of any official or administrative pronouncement or
action or judicial decision interpreting or applying such laws or regulations,
which amendment or change is effective or such pronouncement, action or decision
is announced on or
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after the date of issuance of the Series A Preferred Securities under the Trust
Agreement, there is more than an insubstantial risk that the Corporation will
not be entitled to treat an amount equal to the Liquidation Amount of the Series
A Preferred Securities as "Tier I Capital" (or the then equivalent thereof) for
purposes of the capital adequacy guidelines of the Federal Reserve, as then in
effect and applicable to the Corporation.
"Like Amount" means (i) with respect to a redemption of the Series A
Preferred Securities, Series A Preferred Securities having a Liquidation Amount
equal to that portion of the principal amount of the Series A Subordinated
Debentures to be contemporaneously redeemed in accordance with the Indenture,
allocated to the Series A Common Securities and to the Series A Preferred
Securities pro rata based upon the relative Liquidation Amounts of such
Securities and the proceeds of which will be used to pay the Redemption Price of
such Series A Preferred Securities and (ii) with respect to a distribution of
the Series A Subordinated Debentures to holders of the Series A Preferred
Securities in exchange therefor in connection with a dissolution or liquidation
of the Series A Issuer, Series A Subordinated Debentures having a principal
amount equal to the Liquidation Amount of the Series A Preferred Securities of
the holder to whom such Series A Subordinated Debentures would be distributed.
Notice of any redemption will be mailed at least 30 days but not more
than 60 days before the redemption date to each Holder of the Series A
Subordinated Debentures to be redeemed at its registered address. Unless the
Corporation defaults in payment of the Redemption Price, on and after the
redemption date, interest shall cease to accrue on the Series A Subordinated
Debentures or portions thereof called for redemption.
Restrictions on Certain Payments
The Corporation has also covenanted, as to the Series A Subordinated
Debentures, that it will not, and will not permit any subsidiary of the
Corporation to, (i) declare or pay any dividends or distributions on, or redeem,
purchase, acquire or make a liquidation payment with respect to, any of the
Corporation's capital stock, (ii) make any payment of principal, interest or
premium, if any, on or repay or repurchase or redeem any debt securities of the
Corporation that rank pari passu with or junior in interest to the Series A
Subordinated Debentures or (iii) make any guarantee payments with respect to any
guarantee by the Corporation of the debt securities of any subsidiary of the
Corporation if such guarantee ranks pari passu with or junior in interest to the
Series A Subordinated Debentures (other than (a) dividends or distributions in
common stock of the Corporation, (b) any declaration of a dividend in connection
with the implementation of a stockholders' rights plan, the issuance of stock
under any such plan in the future or the redemption or repurchase of any such
rights pursuant thereto, (c) payments under the Series A Guarantee and (d)
purchases of common stock related to the issuance of common stock or rights
under any of the Corporation's benefit plans for its directors, officers or
employees), if at such time (i) there shall have occurred any event of which the
Corporation has actual knowledge (a) that with the giving of notice or the lapse
of time, or both, would constitute an event of default under the Indenture with
respect to the Series A Subordinated Debentures and (b) in respect of which the
Corporation shall not have taken reasonable steps to cure, (ii) if the Series A
Subordinated Debentures are held by the Series A Issuer, the Corporation shall
be in default with respect to its payment of any obligations under the Series A
Guarantee relating to the Series A Preferred Securities or (iii) the Corporation
shall have given notice of its election of an Extension Period as provided in
the Indenture and shall not have rescinded such notice, or such Extension
Period, or any extension thereof, shall be continuing.
Modification of Indenture
From time to time the Corporation and the Debenture Trustee may, without
the consent of the holders of the Series A Subordinated Debentures, amend, waive
or supplement the Indenture for specified purposes, including, among other
things, curing ambiguities, defects or inconsistencies, provided that any such
action does not materially adversely affect the interest of the holders of the
Series A Subordinated Debentures, and qualifying, or maintaining the
qualification of, the Indenture under the Trust Indenture Act. The Indenture
contains provisions permitting the Corporation and the Debenture Trustee, with
the consent of the holders of not less than a majority in principal amount of
the Series A Subordinated Debentures affected, to modify the Indenture in a
manner affecting the rights of the holders of the Series A Subordinated
Debentures; provided that no such modification may, without the consent
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of the holder of each outstanding Series A Subordinated Debenture so affected,
(i) change the Stated Maturity of the Series A Subordinated Debentures, (ii)
reduce the principal amount thereof or reduce the rate or extend the time of
payment of interest thereon or (iii) reduce the percentage of principal amount
of the Series A Subordinated Debentures, the holders of which are required to
consent to any such modification of the Indenture; and, further provided that
where a consent under the Indenture would require the consent of each holder of
the Series A Subordinated Debentures affected thereby, no such consent shall be
given by the Property Trustee without the prior consent of each holder of the
Series A Preferred Securities.
Debenture Events of Default
The Indenture provides that any one or more of the following described
events with respect to the Series A Subordinated Debentures that has occurred
and is continuing constitutes a "Debenture Event of Default":
(i) failure for 30 days to pay interest on the Series A Subordinated
Debentures when due (subject to the deferral of any due date in the case of an
Extension Period); or
(ii) failure to pay any principal on the Series A Subordinated
Debentures when due, whether at maturity, upon redemption by declaration or
otherwise; or
(iii) failure to observe or perform in any material respect certain
other covenants contained in the Indenture for 90 days after written notice to
the Corporation from the Debenture Trustee or the holders of at least 25% in
aggregate outstanding principal amount of the outstanding Series A Subordinated
Debentures; or
(iv) certain events of bankruptcy, insolvency or reorganization of the
Corporation.
The holders of a majority in aggregate outstanding principal amount of
the Series A Subordinated Debentures have the right to direct the time, method
and place of conducting any proceeding for any remedy available to the Debenture
Trustee. The Debenture Trustee or the holders of not less than 25% in aggregate
outstanding principal amount of the Series A Subordinated Debentures may declare
the principal due and payable immediately upon a Debenture Event of Default,
and, should the Debenture Trustee or such holders of the Series A Subordinated
Debentures fail to make such declaration, the holders of at least 25% in
aggregate Liquidation Amount of the Series A Preferred Securities shall have
such right. The holders of a majority in aggregate outstanding principal amount
of the Series A Subordinated Debentures may annul such declaration and waive the
default if the default (other than the non-payment of the principal of the
Series A Subordinated Debentures which has become due solely by such
acceleration) has been cured and a sum sufficient to pay all matured
installments of interest and principal due otherwise than by acceleration has
been deposited with the Debenture Trustee, and should the holders of the Series
A Subordinated Debentures fail to waive such default, the holders of a majority
in aggregate Liquidation Amount of the Series A Preferred Securities shall have
such right.
The holders of a majority in aggregate outstanding principal amount of
the Series A Subordinated Debentures affected thereby may, on behalf of the
holders of all the Series A Subordinated Debentures, waive any past default,
except a default in the payment of principal or interest (unless such default
has been cured and a sum sufficient to pay all matured installments of interest
and principal due otherwise than by acceleration has been deposited with the
Debenture Trustee) or a default in respect of a covenant or provision which
under the Indenture cannot be modified or amended without the consent of the
holder of each outstanding Series A Subordinated Debenture and should the
holders of the Series A Subordinated Debentures fail to waive such default, the
holders of a majority in aggregate Liquidation Amount of the Series A Preferred
Securities shall have such right. The Corporation is required to file annually
with the Debenture Trustee a certificate as to whether or not the Corporation is
in compliance with all the conditions and covenants applicable to it under the
Indenture.
Enforcement of Certain Rights by Holders of the Series A Preferred Securities
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If a Debenture Event of Default has occurred and is continuing and such
event is attributable to the failure of the Corporation to pay interest or
principal on the Series A Subordinated Debentures on the date such interest or
principal is otherwise payable, a holder of the Series A Preferred Securities
may institute a legal proceeding directly against the Corporation for
enforcement of payment to such holder of the principal of or interest on the
Series A Subordinated Debentures having a principal amount equal to the
aggregate Liquidation Amount of the Series A Preferred Securities of such holder
(a "Direct Action"). The Corporation may not amend the Indenture to remove the
foregoing right to bring a Direct Action without the prior written consent of
the holders of all of the Series A Preferred Securities. If the right to bring a
Direct Action is removed, the Series A Issuer may become subject to the
reporting obligations under the Exchange Act. The Corporation shall have the
right under the Indenture to set off any payment made to such holder of the
Series A Preferred Securities by the Corporation in connection with a Direct
Action.
The holders of the Series A Preferred Securities will not be able to
exercise directly any remedies other than those set forth in the preceding
paragraph available to the holders of the Series A Subordinated Debentures. See
"Description of the Series A Preferred Securities--Events of Default; Notice".
Consolidation, Merger, Sale of Assets and Other Transactions
The Indenture provides that the Corporation shall not consolidate with
or merge into any other Person or convey, transfer or lease its properties and
assets substantially as an entirety to any Person, and no Person shall
consolidate with or merge into the Corporation or convey, transfer or lease its
properties and assets substantially as an entirety to the Corporation, unless:
(i) in the event the Corporation consolidates with or merges into another
Person, or conveys or transfers its properties and assets substantially as an
entirety to any Person, the successor Person is organized under the laws of the
United States or any state or the District of Columbia, and such successor
Person expressly assumes the Corporation's obligations on the Series A
Subordinated Debentures issued under the Indenture; (ii) immediately after
giving effect thereto, no Debenture Event of Default, and no event which, after
notice or lapse of time or both, would become a Debenture Event of Default,
shall have occurred and be continuing; (iii) if at the time any Series A
Preferred Securities are outstanding, such transaction is permitted under the
Trust Agreement and Guarantee and does not give rise to any breach or violation
of the Trust Agreement or Guarantee; and (iv) certain other conditions as
prescribed by the Indenture are met.
The general provisions of the Indenture do not afford holders of the
Series A Subordinated Debentures protection in the event of a highly leveraged
or other transaction involving the Corporation that may adversely affect holders
of the Series A Subordinated Debentures.
Satisfaction and Discharge
The Indenture provides that when, among other things, all of the Series
A Subordinated Debentures not previously delivered to the Debenture Trustee for
cancellation (i) have become due and payable or (ii) will become due and payable
at their Stated Maturity within one year, and the Corporation deposits or causes
to be deposited with the Debenture Trustee funds, in trust, for the purpose and
in an amount in the currency or currencies in which the Series A Subordinated
Debentures are payable sufficient to pay and discharge the entire indebtedness
on the Series A Subordinated Debentures not previously delivered to the
Debenture Trustee for cancellation, for the principal and interest to the date
of the deposit or to the Stated Maturity, as the case may be, then the Indenture
will cease to be of further effect (except as to the Corporation's obligations
to pay all other sums due pursuant to the Indenture and to provide the officers'
certificates and opinions of counsel described therein), and the Corporation
will be deemed to have satisfied and discharged the Indenture.
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Subordination
In the Indenture, the Corporation has covenanted and agreed that the Series A
Subordinated Debentures issued thereunder are subordinate and junior in right of
payment to all Senior Debt (as defined below) to the extent provided in the
Indenture. Upon any payment or distribution of assets to creditors upon any
liquidation, dissolution, winding-up, reorganization, assignment for the benefit
of creditors, marshaling of assets or any bankruptcy, insolvency, debt
restructuring or similar proceedings in connection with any insolvency or
bankruptcy proceeding of the Corporation, the holders of Senior Debt will first
be entitled to receive payment in full of principal of (or premium, if any) and
interest, if any, on such Senior Debt before the holders of the Series A
Subordinated Debentures, or the Property Trustee on behalf of the holders, will
be entitled to receive or retain any payment in respect of the principal of (or
premium, if any) or interest, if any, on the Series A Subordinated Debentures.
In the event of the acceleration of the maturity of any of the Series A
Subordinated Debentures, the holders of all Senior Debt outstanding at the time
of such acceleration will first be entitled to receive payment in full of all
amounts due thereon (including any amounts due upon acceleration) before the
holders of the Series A Subordinated Debentures will be entitled to receive or
retain any payment in respect of the principal of (or premium, if any) or
interest, if any, on the Series A Subordinated Debentures.
No payments on account of principal (or premium, if any) or interest, if any,
in respect of the Series A Subordinated Debentures may be made if there shall
have occurred and be continuing a default in any payment with respect to Senior
Debt or an event of default with respect to any Senior Debt resulting in the
acceleration of the maturity thereof, or if any judicial proceeding shall be
pending with respect to any such default.
"Debt" means with respect to any Person, whether recourse is to all or a
portion of the assets of such Person and whether or not contingent: (i) every
obligation of such Person for money borrowed; (ii) every obligation of such
Person evidenced by bonds, debentures, notes or other similar instruments,
including obligations incurred in connection with the acquisition of property,
assets or businesses; (iii) every reimbursement obligation of such Person with
respect to letters of credit, bankers' acceptances or similar facilities issued
for the account of such Person; (iv) every obligation of such Person issued or
assumed as the deferred purchase price of property or services (but excluding
trade accounts payable or accrued liabilities arising in the ordinary course of
business); (v) every capital lease obligation of such Person; (vi) all
obligations of such Person for claims in respect of derivative products,
including interest rate, foreign exchange rate and commodity forward contracts,
options and swaps and similar arrangements; and (vii) every obligation of the
type referred to in clauses (i) through (vi) of another Person and all dividends
of another Person the payment of which, in either case, such Person has
guaranteed or is responsible or liable, directly or indirectly, as obligor or
otherwise.
"Senior Debt" means the principal of (and premium, if any) and interest, if
any (including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Corporation whether or not such
claim for post-petition interest is allowed in such proceeding), on Debt,
whether incurred on or prior to the date of the Indenture or thereafter
incurred, unless, in the instrument creating or evidencing the same or pursuant
to which the same is outstanding, it is provided that such obligations are not
superior in right of payment to the Series A Subordinated Debentures or to other
Debt which is pari passu with, or subordinated to, the Series A Subordinated
Debentures; provided, however, that Senior Debt shall not be deemed to include:
(i) any Debt of the Corporation which when incurred and without respect to any
election under Section 1111(b) of the United States Bankruptcy Code of 1978, as
amended, was without recourse to the Corporation, (ii) any Debt of the
Corporation to any of its subsidiaries and (iii) Debt to any employee of the
Corporation.
The Indenture places no limitation on the amount of Senior Debt or
subordinated debt which is pari passu with the Series A Subordinated Debentures,
that may be incurred by the Corporation. The Corporation expects from time to
time to incur additional indebtedness constituting Senior Debt.
Governing Law
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The Indenture and the Series A Subordinated Debentures are governed by and
construed in accordance with the laws of the State of New York.
Information Concerning the Debenture Trustee
The Debenture Trustee is subject to all the duties and responsibilities
specified with respect to an indenture trustee under the Trust Indenture Act.
Subject to such provisions, the Debenture Trustee is under no obligation to
exercise any of the powers vested in it by the Indenture at the request of any
holder of the Series A Subordinated Debentures, unless offered reasonable
indemnity by such holder against the costs, expenses and liabilities which might
be incurred thereby. The Debenture Trustee is not required to expend or risk its
own funds or otherwise incur personal financial liability in the performance of
its duties if the Debenture Trustee reasonably believes that repayment or
adequate indemnity is not reasonably assured to it.
Distribution of the Series A Subordinated Debentures
As described under "Description of the Series A Preferred Securities--
Liquidation of the Series A Issuer and Distribution of the Series A Subordinated
Debentures to Holders", under certain circumstances involving the termination of
the Series A Issuer, Series A Subordinated Debentures may be distributed to the
holders of the Series A Preferred Securities in exchange therefor upon
liquidation of the Series A Issuer, after satisfaction of liabilities to
creditors of the Series A Issuer as provided by applicable law. If distributed
to holders of the Series A Preferred Securities in liquidation, the Series A
Subordinated Debentures will initially be issued in the form of global
securities and, in the case of Series A Subordinated Debentures in respect of
Other Series A Preferred Securities, certificated securities. DTC, or any
successor depositary for the Series A Preferred Securities, will act as
depositary for the Series A Subordinated Debentures in global form. It is
anticipated that the depositary arrangements for the Series A Subordinated
Debentures in global form would be substantially identical to those in effect
for the Series A Preferred Securities. For a description of global securities
and certificated securities, see "Book-Entry Issuance."
There can be no assurance as to the market price of any Series A Subordinated
Debentures that may be distributed to the holders of the Series A Preferred
Securities.
Payment and Paying Agents
Payment of principal (premium, if any) of any interest on the Series A
Subordinated Debentures will be made, the transfer of the Series A Subordinated
Debentures will be registrable, and Series A Subordinated Debentures will be
exchangeable for Series A Subordinated Debentures of other denominations of a
like aggregate principal amount, at the offices of the Debenture Trustee in The
City of New York or at the offices of such Paying Agent or Paying Agents as the
Corporation may designate from time to time, except that at the option of the
Corporation payment of any interest may be made (i) except in the case of Series
A Subordinated Debentures held in the name of the Property Trustee, by check
mailed to the address of the Person entitled thereto as such address shall
appear in the Securities Register or (ii) by transfer to an account maintained
by the Person entitled thereto as specified in the Securities Register, provided
that proper transfer instructions have been received by June 15th or December
15th preceding the date for the payment of interest (the "Regular Record Date").
Payment of any interest on the Series A Subordinated Debentures will be made to
the Person in whose name the Series A Subordinated Debenture is registered at
the close of business on the Regular Record Date for such interest, except in
the case of Defaulted Interest. The Corporation may at any time designate
additional Paying Agents or rescind the designation of any Paying Agent;
however, the Corporation will at all times be required to maintain a Paying
Agent in each Place of Payment for the Series A Subordinated Debentures. See
"Book-Entry Issuance."
Any moneys deposited with the Debenture Trustee or any Paying Agent, or then
held by the Corporation in trust, for the payment of the principal (or premium,
if any) of or interest on the Series A Subordinated Debentures and remaining
unclaimed for two years after such principal (or premium, if any) or interest
has become due and payable shall, at the request of the Corporation, be repaid
to the Corporation and the holders of the Series A
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Subordinated Debentures shall thereafter look, as general unsecured creditors,
only to the Corporation for payment thereof.
BOOK-ENTRY ISSUANCE
DTC acts as securities depositary for all of the Series A Preferred Securities
and the Series A Subordinated Debentures, except for Series A Preferred
Securities issued to certain institutional investors described below. The Series
A Preferred Securities and the Series A Subordinated Debentures which were sold
in the December Securities Sale in reliance on Rule 144A have been issued in
registered, certificated (i.e. non-global) form to accredited investors and in
global form to institutional investors as fully-registered securities registered
in the name of Cede & Co. (DTC's nominee). One or more fully-registered and
global certificates have been issued for the Series A Preferred Securities and
the Series A Subordinated Debentures and have been deposited with DTC or held by
the Property Trustee or Debenture Trustee, respectively, as custodian for DTC.
DTC is a limited purpose trust company organized under the New York Banking
Law, a "banking organization" within the meaning of the New York Banking Law, a
member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code, and a "clearing agency"
registered pursuant to the provisions of Section 17A of the Exchange Act. DTC
holds securities that its Participants deposit with DTC. DTC also facilitates
the settlement among Participants of securities transactions, such as transfers
and pledges, in deposited securities through electronic computerized book-entry
changes in Participants' accounts, thereby eliminating the need for physical
movement of securities certificates. "Direct Participants" include securities
brokers and dealers, banks, trust companies, clearing corporations and certain
other organizations. DTC is owned by a number of its Direct Participants and by
the New York Stock Exchange, Inc., the American Stock Exchange, Inc. and the
National Association of Securities Dealers, Inc. Access to the DTC system is
also available to others such as securities brokers and dealers, banks and trust
companies that clear through or maintain custodial relationships with Direct
Participants, either directly or indirectly ("Indirect Participants"). The rules
applicable to DTC and its participants are on file with the Commission.
Purchases of Series A Preferred Securities or Series A Subordinated Debentures
within the DTC system must be made by or through Direct Participants, which will
receive a credit for the Series A Preferred Securities or Series A Subordinated
Debentures on DTC's records. The ownership interest of each actual purchaser of
each Series A Preferred Security and each Series A Subordinated Debenture
("Beneficial Owner") is in turn to be recorded on the Direct and Indirect
Participants' records. Beneficial owners will not receive written confirmation
from DTC of their purchases, but Beneficial owners are expected to receive
written confirmations providing details of the transactions, as well as periodic
statements of their holdings, from the Direct or Indirect Participants through
which the Beneficial Owners purchased Series A Preferred Securities or Series A
Subordinated Debentures. Transfers of ownership interests in the Series A
Preferred Securities or Series A Subordinated Debentures are to be accomplished
by entries made on the books of Participants acting on behalf of Beneficial
Owners. Beneficial Owners will not receive certificates representing their
ownership interests in Series A Preferred Securities or Series A Subordinated
Debentures held through DTC, except in the event that use of the book-entry
system for the Series A Preferred Securities or Series A Subordinated Debentures
is discontinued.
DTC has no knowledge of the actual Beneficial Owners of the Series A Preferred
Securities or Series A Subordinated Debentures; DTC's records reflect only the
identity of the Direct Participants to whose accounts such Series A Preferred
Securities or Series A Subordinated Debentures are credited, which may or may
not be the Beneficial Owners. The Participants will remain responsible for
keeping account of their holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to Direct Participants,
by Direct Participants to Indirect Participants, and by Direct Participants and
Indirect Participants to Beneficial Owners and the voting rights of Direct
Participants, Indirect Participants and Beneficial Owners will be governed by
arrangements among them, subject to any statutory or regulatory requirements as
may be in effect from time to time.
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Redemption notices with respect to Series A Preferred Securities or Series A
Subordinated Debentures will be sent to Cede & Co. as the registered holder of
the Series A Preferred Securities or Series A Subordinated Debentures. If less
than all of the Series A Preferred Securities or the Series A Subordinated
Debentures are being redeemed, DTC's current practice is to determine by lot the
amount of the interest of each Direct Participant to be redeemed.
Although voting with respect to the Series A Preferred Securities or the
Series A Subordinated Debentures is limited to the holders of record of the
Series A Preferred Securities or Series A Subordinated Debentures, in those
instances in which a vote is required, neither DTC nor Cede & Co. will itself
consent or vote with respect to Series A Preferred Securities or Series A
Subordinated Debentures. Under its usual procedures, DTC would mail an omnibus
proxy (the "Omnibus Proxy") to the relevant Trustee as soon as possible after
the record date. The Omnibus Proxy assigns Cede & Co.'s consenting or voting
rights to those Direct Participants to whose accounts such Series A Preferred
Securities or Series A Subordinated Debentures are credited on the record date
(identified in a listing attached to the Omnibus Proxy).
Distribution payments on the Series A Preferred Securities or the Series A
Subordinated Debentures will be made by the relevant Trustee to DTC. DTC's
practice is to credit Direct Participants' accounts on the relevant payment date
in accordance with their respective holdings shown on DTC's records unless DTC
has reason to believe that it will not receive payments on such payment date.
Payments by Participants to Beneficial Owners will be governed by standing
instructions and customary practices and will be the responsibility of such
statutory or regulatory requirements as may be in effect from time to time.
Payment of Distributions to DTC is the responsibility of the relevant Trustee,
disbursement of such payments to Direct Participants is the responsibility of
DTC, and disbursements of such payments to the Beneficial Owners is the
responsibility of Direct and Indirect Participants.
DTC may discontinue providing its services as securities depositary with
respect to any of the Series A Preferred Securities or the Series A Subordinated
Debentures at any time by giving reasonable notice to the relevant Trustee and
the Corporation. In the event that a successor securities depositary is not
obtained, definitive Series A Preferred Securities or Series A Subordinated
Debentures certificates representing such Series A Preferred Securities or
Series A Subordinated Debentures are required to be printed and delivered. The
Corporation, at its option, may decide to discontinue use of the system of book-
entry transfers through DTC (or a successor depositary). After a Debenture Event
of Default, the holders of a majority in liquidation preference of Series A
Preferred Securities or aggregate principal amount of Series A Subordinated
Debentures may determine to discontinue the system of book-entry transfers
through DTC. In any such event, definitive certificates for such Series A
Preferred Securities or Series A Subordinated Debentures will be printed and
delivered.
The information in this section concerning DTC and DTC's book-entry system has
been obtained from sources that the Series A Issuer and the Corporation believe
to be accurate, but the Series A Issuer and the Corporation assume no
responsibility for the accuracy thereof. Neither the Series A Issuer nor the
Corporation has any responsibility for the performance by DTC or its
Participants of their respective obligations as described herein or under the
rules and procedures governing their respective operations.
DESCRIPTION OF THE SERIES A GUARANTEE
A Guarantee was executed and delivered by the Corporation concurrently with
the issuance of the Series A Preferred Securities for the benefit of the holders
from time to time of such Series A Preferred Securities (the "Series A
Guarantee"). The Bank of New York acts as indenture trustee ("Guarantee
Trustee") under the Series A Guarantee, and the Series A Guarantee has been
qualified as an indenture under the Trust Indenture Act. This summary of certain
provisions of the Series A Guarantee does not purport to be complete and is
subject to, and qualified in its entirety by reference to, all of the provisions
of the Series A Guarantee, including the definitions therein of certain terms,
and the Trust Indenture Act. All material terms of the Series A Guarantee are
set forth in this Prospectus. A copy of the Series A Guarantee may be obtained
from the Corporation. The Guarantee Trustee holds the Series A Guarantee for the
benefit of the holders of the Series A Preferred Securities.
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General
The Corporation has irrevocably agreed to pay in full on a subordinated basis,
to the extent set forth herein, the Guarantee Payments (as defined below) to the
holders of the Series A Preferred Securities, as and when due, regardless of any
defense, right of set-off or counterclaim that the Issuer may have or assert
other than the defense of payment. The following payments with respect to the
Series A Preferred Securities, to the extent not paid by or on behalf of the
Series A Issuer (the "Guarantee Payments"), are subject to the Series A
Guarantee: (i) any accumulated and unpaid Distributions required to be paid on
the Series A Preferred Securities, to the extent that the Series A Issuer has
funds on hand available therefor at such time, (ii) the Redemption Price with
respect to the Series A Preferred Securities called for redemption, to the
extent that the Series A Issuer has funds on hand available therefor at such
time and (iii) upon a voluntary or involuntary dissolution, winding up or
liquidation of the Series A Issuer (unless the Series A Subordinated Debentures
are distributed to holders of the Series A Preferred Securities), the lesser of
(a) the Liquidation Distribution and (b) the amount of assets of the Series A
Issuer remaining available for distribution to holders of the Series A Preferred
Securities after satisfaction of liabilities to creditors of the Series A Issuer
as required by applicable law. The Corporation's obligation to make a Guarantee
Payment may be satisfied by direct payment of the required amounts by the
Corporation to the holders of the Series A Preferred Securities or by causing
the Series A Issuer to pay such amounts to such holders.
The Series A Guarantee is an irrevocable guarantee on a subordinated basis of
the Series A Issuer's obligations under the Series A Preferred Securities, but
applies only to the extent that the Series A Issuer has funds sufficient to make
such payments, and is not a guarantee of collection.
If the Corporation does not make interest payments on the Series A
Subordinated Debentures held by the Series A Issuer, the Series A Issuer will
not be able to pay Distributions on the Series A Preferred Securities and will
not have funds legally available therefor. The Series A Guarantee ranks
subordinate and junior in right of payment to all Senior Debt of the
Corporation. See "--Status of the Series A Guarantee". Because the Corporation
is a holding company, the right of the Corporation to participate in any
distribution of assets of any subsidiary upon such subsidiary's liquidation or
reorganization or otherwise is subject to the prior claims of creditors of that
subsidiary, except to the extent the Corporation may itself be recognized as a
creditor of that subsidiary. Accordingly, the Corporation's obligations under
the Guarantee are effectively subordinated to all existing and future
liabilities of the Corporation's subsidiaries, and claimants should look only to
the assets of the Corporation for payments thereunder. See "The Corporation".
The Series A Guarantee does not limit the incurrence or issuance of other
secured or unsecured debt of the Corporation, including Senior Debt, whether
under the Indenture, any other indenture that the Corporation may enter into in
the future, or otherwise.
The Corporation has, through the Series A Guarantee, the Trust Agreement, the
Series A Subordinated Debentures, the Indenture and the Expense Agreement, taken
together, fully, irrevocably and unconditionally guaranteed all of the Series A
Issuer's obligations under the Series A Preferred Securities. No single document
standing alone or operating in conjunction with fewer than all of the other
documents constitutes such guarantee. It is only the combined operation of these
documents that has the effect of providing a full, irrevocable and unconditional
guarantee of the Series A Issuer's obligations under the Series A Preferred
Securities. See "Relationship Among the Series A Preferred Securities, the
Series A Subordinated Debentures, the Expense Agreement and the Series A
Guarantee".
Status of the Series A Guarantee
The Series A Guarantee constitutes an unsecured obligation of the Corporation
and ranks subordinate and junior in right of payment to all Senior Debt of the
Corporation in the same manner as the Series A Subordinated Debentures.
The Series A Guarantee constitutes a guarantee of payment and not of
collection (i.e., the guaranteed party may institute a legal proceeding directly
against the Guarantor to enforce its rights under the Series A Guarantee without
first instituting a legal proceeding against any other person or entity). The
Series A Guarantee is held for
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the benefit of the holders of the Series A Preferred Securities. The Series A
Guarantee will not be discharged except by payment of the Guarantee Payments in
full to the extent not paid by the Series A Issuer or upon distribution to the
holders of the Series A Preferred Securities of the Series A Subordinated
Debentures. The Series A Guarantee does not place a limitation on the amount of
additional Senior Debt that may be incurred by the Corporation. The Corporation
expects from time to time to incur additional indebtedness constituting Senior
Debt.
Amendments and Assignment
Except with respect to any changes that do not materially adversely affect the
rights of holders of the Series A Preferred Securities (in which case no vote
will be required), the Series A Guarantee may not be amended without the prior
approval of the holders of not less than a majority of the aggregate Liquidation
Amount of such outstanding Series A Preferred Securities. The manner of
obtaining any such approval will be as set forth under "Description of the
Series A Preferred Securities--Voting Rights; Amendment of the Trust Agreement".
All guarantees and agreements contained in the Guarantee shall bind the
successors, assigns, receivers, trustees and representatives of the Corporation
and shall inure to the benefit of the holders of the Series A Preferred
Securities then outstanding.
Events of Default
An event of default under the Series A Guarantee will occur upon the failure
of the Corporation to perform any of its payments or other obligations
thereunder. The holders of not less than a majority in aggregate Liquidation
Amount of the Series A Preferred Securities have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Guarantee Trustee in respect of such Guarantee or to direct the exercise of any
trust or power conferred upon the Guarantee Trustee under such Guarantee.
Any holder of the Series A Preferred Securities may institute a legal
proceeding directly against the Corporation to enforce its rights under the
Series A Guarantee without first instituting a legal proceeding against the
Series A Issuer, the Guarantee Trustee or any other person or entity.
The Corporation, as guarantor, is required to file annually with the Guarantee
Trustee a certificate as to whether or not the Corporation is in compliance with
all the conditions and covenants applicable to it under the Series A Guarantee.
Information Concerning the Guarantee Trustee
The Guarantee Trustee, other than during the occurrence and continuance of a
default by the Corporation in the performance of the Series A Guarantee,
undertakes to perform only such duties as are specifically set forth in the
Series A Guarantee and, after default with respect to the Series A Guarantee,
must exercise the same degree of care and skill as a prudent person would
exercise or use in the conduct of his or her own affairs. Subject to this
provision, the Guarantee Trustee is under no obligation to exercise any of the
powers vested in it by the Series A Guarantee at the request of any holder of
the Series A Preferred Securities unless it is offered reasonable indemnity
against the costs, expenses and liabilities that might be incurred thereby.
Termination of the Series A Guarantee
The Series A Guarantee will terminate and be of no further force and effect
upon full payment of the Redemption Price of the Series A Preferred Securities,
upon full payment of the amounts payable upon liquidation of the Series A Issuer
or upon distribution of the Series A Subordinated Debentures to the holders of
the Series A Preferred Securities in exchange therefor. The Series A Guarantee
will continue to be effective or will be reinstated, as the case may be, if at
any time any holder of the Series A Preferred Securities must restore payment of
any sums paid under the Series A Preferred Securities or the Series A Guarantee.
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Governing Law
The Series A Guarantee is governed by and construed in accordance with the
laws of the State of New York.
The Expense Agreement
Pursuant to the Expense Agreement entered into by the Corporation, as holder
of the Common Securities under the Trust Agreement (the "Expense Agreement"),
the Corporation has irrevocably and unconditionally guaranteed to each person or
entity to whom the Series A Issuer becomes indebted or liable, the full payment
of any costs, expenses or liabilities of the Series A Issuer, other than
obligations of the Series A Issuer to pay to the holders of the Series A
Securities the amounts due such holders pursuant to the terms of the Series A
Securities.
RELATIONSHIP AMONG THE SERIES A PREFERRED SECURITIES,
THE SERIES A SUBORDINATED DEBENTURES, THE EXPENSE
AGREEMENT AND THE SERIES A GUARANTEE
Full and Unconditional Guarantee
Payments of Distributions and other amounts due on the Series A Preferred
Securities (to the extent the Series A Issuer has funds available for the
payment of such Distributions) are irrevocably guaranteed by the Corporation as
and to the extent set forth under "Description of the Series A Guarantee". Taken
together, the Corporation's obligations under the Series A Subordinated
Debentures, the Indenture, the Trust Agreement, the Expense Agreement and the
Series A Guarantee provide, in the aggregate, a full, irrevocable and
unconditional guarantee of payments of distributions and other amounts due on
the Series A Preferred Securities. No single document standing alone or
operating in conjunction with fewer than all of the other documents constitutes
such guarantee. It is only the combined operation of these documents that has
the effect of providing a full, irrevocable and unconditional guarantee of the
Series A Issuer's obligations under the Series A Preferred Securities. If and to
the extent that the Corporation does not make payments on the Series A
Subordinated Debentures, the Series A Issuer will not pay Distributions or other
amounts due on its Series A Preferred Securities. The Series A Guarantee does
not cover payment of Distributions when the Series A Issuer does not have
sufficient funds to pay such Distributions. In such event, the remedy of a
holder of the Series A Preferred Securities is to institute a Direct Action
against the Corporation pursuant to the Indenture for enforcement of payment of
such Distributions to such holder. The obligations of the Corporation under the
Series A Guarantee are subordinate and junior in right of payment to all Senior
Debt.
Sufficiency of Payments
As long as payments of interest and other payments are made when due on the
Series A Subordinated Debentures, such payments will be sufficient to cover
Distributions and other payments due on the Series A Preferred Securities,
primarily because: (i) the aggregate principal amount of the Series A
Subordinated Debentures is equal to the sum of the aggregate stated Liquidation
Amount of the Series A Preferred Securities and Series A Common Securities; (ii)
the interest rate and interest and other payment dates on the Series A
Subordinated Debentures match the Distribution rate and Distribution and other
payment dates for the Series A Securities; (iii) the Corporation shall pay for
all and any costs, expenses and liabilities of the Series A Issuer except the
Series A Issuer's obligations to holders of its Series A Securities; and (iv)
the Trust Agreement further provides that the Series A Issuer will not engage in
any activity that is not consistent with the limited purposes of the Series A
Issuer.
Notwithstanding anything to the contrary in the Indenture, the Corporation has
the right to set off any payment it is otherwise required to make thereunder
with and to the extent the Corporation has theretofore made, or is concurrently
on the date of such payment making, a payment under the Series A Guarantee.
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Enforcement Rights of Holders of the Series A Preferred Securities
A holder of a Series A Preferred Security may institute a legal proceeding
directly against the Corporation to enforce its rights under the Series A
Guarantee without first instituting a legal proceeding against the Guarantee
Trustee, the Series A Issuer or any other person or entity.
A default or event of default under any Senior Debt of the Corporation would
not constitute a default or Event of Default under the Indenture. However, in
the event of payment defaults under, or acceleration of, Senior Debt of the
Corporation, the subordination provisions of the Indenture provide that no
payments may be made in respect of the Series A Subordinated Debentures until
such Senior Debt has been paid in full or any payment default thereunder has
been cured or waived. Failure to make required payments on the Series A
Subordinated Debentures would constitute an event of default under the
Indenture.
Limited Purpose of the Series A Issuer
The Series A Preferred Securities evidence a beneficial interest in the Series
A Issuer, and the Series A Issuer exists for the sole purpose of issuing its
Series A Preferred Securities and Series A Common Securities and investing the
proceeds thereof in Series A Subordinated Debentures. A principal difference
between the rights of a holder of a Series A Preferred Security and a holder of
a Series A Subordinated Debenture is that a holder of a Series A Subordinated
Debenture is entitled to receive from the Corporation the principal amount (or
premium, if any) of and interest accrued on Series A Subordinated Debentures
held, while a holder of the Series A Preferred Securities is entitled to receive
Distributions from the Series A Issuer (or from the Corporation under the Series
A Guarantee) if, and to the extent, the Series A Issuer has funds available for
the payment of such Distributions.
Rights Upon Termination
Upon any voluntary or involuntary termination, winding-up or liquidation of
the Series A Issuer involving the liquidation of the Series A Subordinated
Debentures, the holders of the Series A Preferred Securities will be entitled to
receive, out of assets held by the Series A Issuer, the Liquidation Distribution
in cash. See "Description of the Series A Preferred Securities--Liquidation
Distribution upon Termination". Upon any voluntary or involuntary liquidation
or bankruptcy of the Corporation, the Property Trustee, as holder of the Series
A Subordinated Debentures, would be a subordinated creditor of the Corporation,
subordinated in right of payment to all Senior Debt as set forth in the
Indenture, but entitled to receive payment in full of principal, (or premium, if
any) and interest, before any stockholders of the Corporation receive payments
or distributions. Since the Corporation is the guarantor under the Series A
Guarantee and has agreed to pay for all costs, expenses and liabilities of the
Series A Issuer (other than the Series A Issuer's obligations to the holders of
its Series A Preferred Securities), the positions of a holder of such Preferred
Securities and a holder of the Series A Subordinated Debentures relative to
other creditors and to stockholders of the Corporation in the event of
liquidation or bankruptcy of the Corporation are expected to be substantially
the same.
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CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The following is a summary of the principal United States federal income tax
consequences of the purchase, ownership and disposition of the Series A
Preferred Securities. This summary addresses only the tax consequences to a
person that acquires Series A Preferred Securities on their original issue at
their original offering price and does not address the tax consequences to
persons that may be subject to special treatment under United States federal
income tax law, such as banks, insurance companies, thrift institutions,
regulated investment companies, real estate investment trusts, tax-exempt
organizations, dealers in securities or currencies, persons that will hold
Series A Preferred Securities as part of a position in a "straddle" or as part
of a "hedging", "conversion" or other integrated investment transaction for
federal income tax purposes, persons whose functional currency is not the United
States dollar or persons that do not hold Series A Preferred Securities as
capital assets.
The statements of law or legal conclusions set forth in this summary
constitute the opinion of Sullivan & Cromwell, counsel to the Corporation and
the Series A Issuer. This summary is based upon the Internal Revenue Code of
1986, as amended (the "Code"), Treasury Regulations, Internal Revenue Service
rulings and pronouncements and judicial decisions now in effect, all of which
are subject to change at any time. Such changes may be applied retroactively in
a manner that could cause the tax consequences to vary substantially from the
consequences described below, possibly adversely affecting a beneficial owner of
the Series A Preferred Securities. In particular, legislation has been proposed
that could adversely affect the Corporation's ability to deduct interest on the
Series A Subordinated Debentures, which may in turn permit the Corporation to
cause a redemption of the Series A Preferred Securities. See "--Possible Tax Law
Changes". The authorities on which this summary is based are subject to various
interpretations, and it is therefore possible that the federal income tax
treatment of the purchase, ownership and disposition of the Series A Preferred
Securities may differ from the treatment described below.
PROSPECTIVE INVESTORS ARE ADVISED TO CONSULT WITH THEIR OWN TAX ADVISORS IN
LIGHT OF THEIR OWN PARTICULAR CIRCUMSTANCES AS TO THE FEDERAL TAX CONSEQUENCES
OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF THE SERIES A PREFERRED SECURITIES,
AS WELL AS THE EFFECT OF ANY STATE, LOCAL OR FOREIGN TAX LAWS.
Classification of the Series A Issuer
Under current law and assuming compliance with the terms of the Trust
Agreement, the Series A Issuer has not been classified as an association taxable
as a corporation for United States federal income tax purposes. As a result,
each beneficial owner of Series A Preferred Securities (a "Securityholder") will
be required to include in its gross income its pro rata share of the original
issue discount accrued with respect to the Series A Subordinated Debentures
whether or not cash is actually distributed to the Securityholders. See "--
Original Issue Discount". No amount included in income with respect to the
Series A Preferred Securities is eligible for the dividends-received deduction.
Original Issue Discount
Under the Indenture, the Corporation has the right to defer the payment of
interest on the Series A Subordinated Debentures at any time or from time to
time for a period not exceeding 10 consecutive semi-annual periods with respect
to each Extension Period, provided that no Extension Period may extend beyond
the Stated Maturity of the Series A Subordinated Debentures. Because of this
option, all interest payable on the Series A Subordinated Debentures will be
treated as "original issue discount" ("OID") for federal income tax purposes.
Accordingly, a Securityholder will recognize income (in the form of OID) on a
daily basis under a constant yield method over the term of the Series A
Subordinated Debentures (including during any Extension Period), regardless of
the receipt of cash with respect to the period to which such income is
attributable. (Subsequent uses of the term "interest" in this summary shall
include income in the form of OID.) The possible payment of additional interest
upon a Registration Default should not be taken into account in computing the
amount of OID required to be accrued
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by the Securityholder. The amount of OID that accrues in any semi-annual period
(other than during an Extension Period) will equal approximately the amount of
the interest that accrues on the Series A Subordinated Debentures in that semi-
annual period at the stated interest rate.
In the event that the interest payment period is extended, Securityholders
will include interest in gross income in advance of the receipt of cash, and any
Securityholders who dispose of the Series A Preferred Securities prior to the
record date for the payment of Distributions following such Extension Period
will include interest in gross income but will not receive any cash related
thereto from the Series A Issuer. Any amount of OID included in a
Securityholder's gross income (whether or not during an Extension Period) will
increase such Securityholder's tax basis in its Series A Preferred Securities,
and the amount of Distributions received by a Securityholder will reduce such
Securityholder's tax basis in its Series A Preferred Securities.
Distribution of the Series A Subordinated Debentures to Holders of Series A
Preferred Securities
Under current law, a distribution by the Series A Issuer of the Series A
Subordinated Debentures as described under the caption "Description of the
Series A Preferred Securities--Liquidation of the Series A Issuer and
Distribution of Series A Subordinated Debentures to Holders" will be non-taxable
and will result in the Securityholder receiving directly its pro rata share of
the Series A Subordinated Debentures previously held indirectly through the
Series A Issuer, with a holding period and aggregate tax basis equal to the
holding period and aggregate tax basis such Securityholder had in its Series A
Preferred Securities before such distribution. A Securityholder will accrue
interest in respect of the Series A Subordinated Debentures received from the
Series A Issuer in the manner described above under "--Original Issue Discount".
Sales or Redemption of the Series A Preferred Securities
Gain or loss will be recognized by a Securityholder on a sale of the Series A
Preferred Securities (including a redemption for cash) in an amount equal to the
difference between the amount realized and the Securityholder's adjusted tax
basis in the Series A Preferred Securities sold or so redeemed. Gain or loss
recognized by a Securityholder on the Series A Preferred Securities held for
more than one year will generally be taxable as long-term capital gain or loss.
The Series A Preferred Securities may trade at a price that does not fully
reflect the value of accrued but unpaid interest with respect to the underlying
Series A Subordinated Debentures. A Securityholder that disposes of its Series A
Preferred Securities between record dates for payments of Distributions (and
consequently does not receive a Distribution from the Series A Issuer for the
period prior to such disposition) will nevertheless be required to include in
income as ordinary income accrued but unpaid interest on the Series A
Subordinated Debentures through the date of disposition and to add such amount
to its adjusted tax basis in its Series A Preferred Securities disposed of. Such
Securityholder will recognize a capital loss on the disposition of its Series A
Preferred Securities to the extent the selling price (which may not fully
reflect the value of accrued but unpaid interest) is less than the
Securityholder's adjusted tax basis in the Series A Preferred Securities (which
will include accrued but unpaid interest). Subject to certain limited
exceptions, capital losses cannot be applied to offset ordinary income for
federal income tax purposes.
Possible Tax Law Changes
On March 19, 1996, the Revenue Reconciliation Bill of 1996 (the "Bill") was
introduced in the 104th Congress, which would have, among other things,
generally denied interest deductions for interest on an instrument issued by a
corporation that has a maximum weighted average maturity of more than 40 years.
The Bill would also have generally denied interest deductions for interest on an
instrument issued by a corporation that has a maximum term of more than 20 years
and that is not shown as indebtedness on the separate balance sheet of the
issuer or, where the instrument is issued to a related party (other than a
corporation), where the holder or some other related
-52-
<PAGE>
party issues a related instrument that is not shown as indebtedness on the
issuer's consolidated balance sheet. The above-described provision of the Bill
was proposed to be effective generally for instruments issued on or after
December 7, 1995. If such provision were to have applied to the Series A
Subordinated Debentures, the Corporation would have been unable to deduct
interest on the Series A Subordinated Debentures. However, on March 29, 1996,
the Chairmen of the Senate Finance and House Ways and Means Committees issued a
joint statement to the effect that it was their intention that the effective
date of the President's legislative proposals, if adopted, would be no earlier
than the date of appropriate Congressional action. Under current law, the
Corporation will be able to deduct interest on the Series A Subordinated
Debentures. President Clinton's proposed 1998 fiscal year budget reiterated a
substantially similar proposal on February 6, 1997. Although the 104th Congress
adjourned without enacting the Bill, there can be no assurance that legislation
adopted by the 105th Congress will not affect the ability of the Corporation to
deduct interest on the Series A Subordinated Debentures. Such a change could
give rise to a Tax Event, which may permit the Corporation to cause a redemption
of the Series A Preferred Securities, as described more fully under "Description
of the Series A Preferred Securities--Redemption".
United States Alien Holders
For purposes of this discussion, a "United States Alien Holder" is any
corporation, individual, partnership, estate or trust that is, as to the United
States, a foreign corporation, a non-resident alien individual, a foreign
partnership or a non-resident fiduciary of a foreign estate or trust.
Under present United States federal income tax law: (i) payments by the Series
A Issuer or any of its paying agents to any Securityholder who or which is a
United States Alien Holder will not be subject to United States federal
withholding tax; provided that (a) the Securityholder does not actually or
constructively own 10% or more of the total combined voting power of all classes
of stock of the Corporation entitled to vote, (b) the Securityholder is not a
controlled foreign corporation that is related to the Corporation through stock
ownership and (c) either (A) the Securityholder certifies to the Series A Issuer
or its agent, under penalties of perjury, that it is not a United States holder
and provides its name and address or (B) a securities clearing organization,
bank or other financial institution that holds customers' securities in the
ordinary course of its trade or business (a "Financial Institution"), and holds
the Series A Preferred Security in such capacity, certifies to the Series A
Issuer or its agent, under penalties of perjury, that such statement has been
received from the Securityholder by it or by a Financial Institution holding
such security for the Securityholder and furnishes the Series A Issuer or its
agent with a copy thereof; and (ii) a United States Alien Holder of a Series A
Preferred Security will not be subject to United States federal withholding tax
on any gain realized upon the sale or other disposition of a Series A Preferred
Security.
Recently proposed Internal Revenue Service Treasury regulations (the "Proposed
Regulations") would provide alternative methods for satisfying the certification
requirement described in clause (i)(c) above. The Proposed Regulations also
would require, in the case of Series A Preferred Securities held by a foreign
partnership, that (x) the certification described in clause (i)(c) above be
provided by the partners rather than by the foreign partnership and (y) the
partnership provide certain information, including a United States taxpayer
identification number. A look-through rule would apply in the case of tiered
partnerships. The Proposed Regulations are proposed to be effective for payments
made after December 31, 1997. There can be no assurance that the Proposed
Regulations will be adopted or as to the provisions that they will include if
and when adopted in temporary or final form.
Information Reporting to Securityholders
Generally, income on the Series A Preferred Securities will be reported to
Securityholders on Forms 1099, which forms should be mailed to Securityholders
by January 31 following each calendar year.
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<PAGE>
Backup Withholding
Payments made on, and proceeds from the sale of, the Series A Preferred
Securities may be subject to a "backup" withholding tax of 31% unless the
Securityholder complies with certain certification requirements. Any withheld
amounts will be allowed as a credit against the Securityholder's United States
federal income tax, provided the required information is provided to the
Internal Revenue Service on a timely basis.
ERISA CONSIDERATIONS
The Employee Retirement Income Security Act of 1974, as amended ("ERISA"),
imposes certain requirements on those employee benefit plans to which it applies
("Plans") and on those persons who are fiduciaries with respect to such Plans.
In accordance with ERISA's general fiduciary standards, before purchasing the
Series A Preferred Securities a Plan fiduciary should determine whether such an
investment is permitted under the governing Plan instruments and is appropriate
for the Plan in view of its overall investment policy and the composition and
diversification of its portfolio. Other provisions of ERISA and the Code require
that certain reporting and disclosure be made with respect to plan assets and
investments, and still other provisions of ERISA and the Code prohibit certain
transactions involving the assets of a Plan and persons who have certain
specified relationships to the Plan ("parties in interest" within the meaning of
ERISA or "disqualified persons" within the meaning of the Code). Thus, a Plan
fiduciary considering an investment in the Series A Preferred Securities should
consult with its legal counsel concerning the legal implications of investing in
the Series A Preferred Securities, especially in light of the issues discussed
in the immediately succeeding paragraphs.
If the assets of the Series A Issuer were deemed to be plan assets of Plans
that are holders of the Series A Preferred Securities, the Plan's investments in
the Series A Preferred Securities might be deemed to constitute a delegation
under ERISA of the duty to manage plan assets by a fiduciary investing in Series
A Preferred Securities, and certain transactions involving the operation of the
Series A Issuer might be deemed to constitute prohibited transactions under
ERISA and the Code.
The U.S. Department of Labor (the "DOL") has issued a final regulation with
regard to whether the underlying assets of an entity in which employee benefit
plans acquire equity interests would be deemed to be plan assets. The regulation
provides that the underlying assets of an entity will not be considered to be
plan assets if the equity interests acquired by employee benefit plans are
"publicly-offered securities" -- that is, they are (1) widely held (i.e., owned
by more than 100 investors independently of the Corporation and of each other),
(2) freely transferable and (3) sold as part of an offering pursuant to an
effective registration statement under the Securities Act and then timely
registered under Section 12(b) or 12(g) of the Exchange Act. It is expected that
the Series A Preferred Securities will meet the criteria of "publicly-offered
securities" above. Specifically, it is expected (although no assurances can be
given) that the Series A Securities will be held by at least 100 independent
investors at the conclusion of the offering, there are no restrictions imposed
on the transfer of the Series A Preferred Securities and the Series A Preferred
Securities will be sold as part of an offering pursuant to an effective
registration statement under the Securities Act of 1933, as amended, and then
will be timely registered under the Exchange Act.
In the event that the assets of the Series A Issuer were deemed to be "plan
assets" of Plans that are holders of the Series A Securities of the Series A
Issuer, there are five class exemptions issued by the DOL which may apply to
exempt certain transactions involving assets of the Series A Issuer from the
prohibited transaction provisions of ERISA and the Code: Prohibited Transaction
Exemption 84-14, for certain transactions determined by qualified professional
asset managers, Prohibited Transaction Exemption 90-1, for certain transactions
involving insurance company pooled separate accounts, Prohibited Transaction
Exemption 91-38, for certain transactions involving bank collective investment
funds, Prohibited Transaction 95-60 for certain transactions involving insurance
company general accounts, and Prohibited Transaction Exemption 96-23, for
certain transactions determined by in-house asset managers. A plan considering
the purchase of the Series A Preferred Securities should consult with legal
counsel concerning the applicability of these class exemptions prior to making
an investment.
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<PAGE>
Employee benefit plans that are governmental plans (as defined in Section
3(32) of ERISA) are not subject to ERISA requirements but may be subject to
somewhat similar provisions of other applicable federal or state law or legal
restrictions on their ability to invest in the Series A Preferred Securities.
Accordingly, governmental plans should consult with legal counsel prior to
making an investment.
THE SALE OF INVESTMENTS TO PLANS IS IN NO RESPECT A REPRESENTATION BY THE
SERIES A ISSUER, THE CORPORATION, THE PROPERTY TRUSTEE OR ANY OTHER PERSON
ASSOCIATED WITH THE SALE OF THE SERIES A PREFERRED SECURITIES THAT SUCH
INVESTMENTS MEET ALL RELEVANT LEGAL REQUIREMENTS WITH RESPECT TO INVESTMENTS BY
PLANS GENERALLY OR ANY PARTICULAR PLAN, OR THAT SUCH INVESTMENTS ARE OTHERWISE
APPROPRIATE FOR PLANS GENERALLY OR ANY PARTICULAR PLAN.
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<PAGE>
SELLING SECURITYHOLDERS
The Registration Statement has been filed pursuant to Rule 415 under the
Securities Act to afford the holders of the Series A Preferred Securities the
opportunity to sell such securities in a public transaction rather than pursuant
to an exemption from the registration and prospectus delivery requirements of
the Securities Act. In order to avail itself of that opportunity, a holder must
notify the Corporation in writing of its intention to sell Series A Preferred
Securities and request the Corporation to file a supplement to this Prospectus
or an amendment to the Registration Statement identifying such holder as a
Selling Securityholder and disclosing such other information concerning the
Selling Securityholder and the Series A Preferred Securities to be sold as may
then be required by the Securities Act and the rules and regulations thereunder,
as applicable. No offer or sale pursuant to this Prospectus may be made by any
holder until such a request has been made and until any such supplement has been
filed or any such amendment has become effective. The holders of Series A
Preferred Securities who have made such a request and as to whom any such
supplement has been filed or any such amendment has been filed or becomes
effective are referred to herein as "Selling Securityholders". Since the Series
A Preferred Securities are currently listed on PORTAL, the holder of the Series
A Preferred Securities at the time such request has been made may differ from
the holders as of the date hereof.
As of the date of this Prospectus no holder of Series A Preferred Securities
has made such a request and, accordingly, no Selling Securityholders are named
herein.
The Corporation will from time to time supplement or amend this Prospectus to
reflect the required information concerning any Selling Securityholders.
The Corporation has agreed to bear all expenses (other than expenses incurred
by any holder of Series A Preferred Securities, including fees and expenses of
counsel and other advisors retained by such holder), in connection with the
registration and sale of the Series A Preferred Securities covered by this
Prospectus.
The following table show the names of the Selling Securityholders, the shares
of Series A Preferred Securities owned beneficially by each of them, as of
[_____________, 1997] (unless otherwise noted), the number of Series A Preferred
Securities that may be offered by each of them pursuant to this Prospectus and
the number of Series A Preferred Securities to be beneficially owned by each of
them after completion of the offering pursuant to this Prospectus, assuming all
of the shares of Series A Preferred Securities being offered hereby are sold in
the offering.
<TABLE>
<CAPTION>
Number of Series
A Preferred
Securities
Beneficially Owned
as of Number of Series Number of Series A
A Preferred Preferred Securities
Name of Selling ____________, Securities Offered Beneficially Owned
Securityholder 1997(1) Hereby After the Offering
- ------------------------------------- ------------------ ------------------ --------------------
<S> <C> <C> <C>
[ ]......................... [ ] [ ] 0
[ ]......................... [ ] [ ] 0
[ ]......................... [ ] [ ] 0
[ ]......................... [ ] [ ] 0
[ ]......................... [ ] [ ] 0
[ ]......................... [ ] [ ] 0
[ ]......................... [ ] [ ] 0
[ ]......................... [ ] [ ] 0
[ ]......................... [ ] [ ] 0
[ ]......................... [ ] [ ] 0
</TABLE>
-56-
<PAGE>
<TABLE>
<S> <C> <C> <C>
[ ]......................... [ ] [ ] 0
[ ]......................... [ ] [ ] 0
[ ]......................... [ ] [ ] 0
[ ]......................... [ ] [ ] 0
[ ]......................... [ ] [ ] 0
[ ]......................... [ ] [ ] 0
[ ]......................... [ ] [ ] 0
[ ]......................... [ ] [ ] 0
[ ]......................... [ ] [ ] 0
--------------------
Total .......................... [ ] 0
====================
</TABLE>
- ---------------
(1) For the purposes of this table, a person is deemed to have "beneficial
ownership" of securities over which such person, directly or indirectly
through any contract, arrangement, understanding, relationship or otherwise,
has or shares (x) voting power (which includes the power to vote or to
direct the voting of such securities) or (y) investment power (which
includes the power to dispose or direct the disposition of such securities).
A person is also deemed to be the beneficial owner of securities: (i) the
beneficial ownership of which such person has the right, at any time within
60 days from _______, 1997 (or such later date as noted in the above table),
to acquire, including but not limited to any right to acquire through the
exercise of options, warrants or rights, the conversion of a convertible
security or the revocation or automatic termination of a trust or
discretionary account or similar arrangement; (ii) the beneficial ownership
of which such person has the right to acquire (as specified in (i)) at any
time, where such right is acquired for the purpose, or with the effect, of
changing or influencing control of the Corporation, or in connection with or
as a participant in any transaction having such purpose or effect; or (iii)
with respect to which such person, directly or indirectly, through the
creation or use of a trust, a proxy, power of attorney, pooling arrangement
or any other contract, arrangement or device purports to have divested
himself of beneficial ownership or to have prevented the vesting of
beneficial ownership as part of a scheme to evade the reporting requirements
of Section 13(d) or (g) of the Securities Exchange Act of 1934. Beneficial
ownership is given as of ___________, 1997 unless noted otherwise.
PLAN OF DISTRIBUTION
The Series A Preferred Securities are outstanding securities and are being
offered for sale from time to time pursuant to this Prospectus by the Selling
Securityholders. The Series A Preferred Securities also may be sold pursuant to
Rule 144 under the Securities Act.
The distribution of the Series A Preferred Securities pursuant to this
Prospectus may be effected from time to time in one or more transactions (which
may involve block transactions) in transactions on PORTAL or in the over-the-
counter market or on any national securities exchange or automated quotation
system on which Series A Preferred Securities may be listed or quoted in the
future, in negotiated transactions, through the writing of options on shares
(whether such options are listed on an options exchange or otherwise) or through
a combination of such methods of sale, at market prices prevailing at the time
of sale, at prices related to such prevailing market prices or at negotiated
prices, in each case as determined by the relevant Selling Securityholder. Each
Selling Securityholder may effect such transactions by selling shares directly
to their purchasers, through agents or to or through broker-dealers, and any
such agents or broker-dealers may receive compensation in the form of
underwriting discounts, concessions or commissions from such Selling
Securityholder, from purchasers of shares for whom they may act as agents or
from both sources (and such compensation may be in excess of customary
commissions). The Selling Securityholders and any broker-dealers that
participate in the distribution may be deemed to be "underwriters" within
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<PAGE>
the meaning of Section 2(1) of the Securities Act, and any commissions, and any
profit on the resale of shares, received by the Selling Securityholders and any
such broker-dealers may be deemed to be underwriting compensation.
To the extent required at the time a particular sale of Series A Preferred
Securities is made hereunder, the Corporation will make available to the
relevant Selling Securityholder for delivery to the purchaser a supplement to
this Prospectus that will include certain information about the sale, for
example, with respect to the number of shares sold, the sale price, any
participating broker-dealers and any discounts or commissions received thereby.
The Corporation will bear all costs and expenses incurred by it in
connection with the offering and sale of the Series A Preferred Securities
pursuant to this Prospectus, but will not be responsible for any commissions,
underwriting discounts or similar amounts payable in respect of any such sale,
or for any other expenses incurred by the Selling Securityholders or any
purchasers. Notwithstanding the foregoing, the Corporation and each Selling
Securityholder have agreed to indemnify each other from certain liabilities
relating to the offering made hereby, including liabilities under the Securities
Act.
In connection with a particular offering of Series A Preferred Securities
pursuant to this Prospectus, participating underwriters or broker-dealers (if
any), or their respective affiliates, may engage in passive market-making
transactions in the Series A Issuer's Series A Preferred Securities on PORTAL in
accordance with Rule 10b-6A under the Exchange Act during the two business day
period before commencement of such offering. Passive market-making transactions
must comply with applicable volume and price limits and must be identified as
such. In general, a passive market-maker may display its bid at a price not in
excess of the highest independent bid for the security; if all independent bids
are lowered below the passive market-maker's bid, however, such bid must then be
lowered when certain purchase limits are exceeded.
The Corporation has agreed with the Selling Securityholders to keep a Shelf
Registration Statement, under which the Selling Securityholders may resell
Series A Preferred Securities from time to time, effective until ____________,
1999 (or such earlier time as all Series A Preferred Securities have been sold
thereunder or pursuant to Rule 144 under the Securities Act), except during
certain limited circumstances. See "Registration Rights Agreement".
Prior to the offering contemplated hereby, there has been no public market
for the Series A Preferred Securities. The Initial Purchasers have advised the
Corporation that they intend to make a market in the Series A Preferred
Securities, but they are not obligated to do so and may discontinue any such
market making at any time without notice. In addition, the market making may be
limited during the pendency of the Shelf Registration Statement. Accordingly,
there can be no assurance that an active market will develop for the Series A
Preferred Securities.
Dillon, Read & Co. Inc. serves as Quotation Agent with respect to the
Series A Preferred Securities and in certain instances will calculate the
Redemption Price thereof.
REGISTRATION RIGHTS AGREEMENT
On December 13, 1996, the Corporation and the Series A Issuer entered into
a registration rights agreement with the Initial Purchasers (the "Registration
Rights Agreement") pursuant to which the Corporation and the Series A Issuer
agreed, at the Corporation's expense, for the benefit of the Initial Purchasers
and the holders of the Series A Preferred Securities, the Series A Guarantee and
the Series A Subordinated Debentures (together, the "Registrable Securities"),
to file a registration statement (the "Shelf Registration Statement") with
respect to the Registrable Securities.
The Registration Rights Agreement provides that the Corporation and the
Series A Issuer will (i) file with the Commission within 60 days after the date
of issuance of the Registrable Securities the Shelf Registration Statement
covering resales of the Registrable Securities, (ii) use their reasonable best
efforts to cause the Shelf Registration Statement to be declared effective under
the Securities Act within 120 days after the date of the issuance
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of the Registrable Securities and (iii) use their reasonable best efforts to
keep effective the Shelf Registration Statement until three years after the date
it is declared effective or such earlier date as all Registrable Securities
shall have been disposed of or on which all Registrable Securities held by
persons that are not affiliates of the Corporation or the Series A Issuer may be
resold without registration pursuant to Rule 144(k) under the Securities Act
(the "Effectiveness Period"). The Corporation will provide to each holder of
Registrable Securities copies of the Prospectus, which is a part of the Shelf
Registration Statement, notify each holder when the Shelf Registration Statement
has become effective and take certain other actions as are required to permit
unrestricted resales of the Registrable Securities. A holder of Registrable
Securities that sells such Registrable Securities pursuant to the Shelf
Registration Statement has been required to be named as a selling security
holder in the related Prospectus and to deliver a Prospectus to purchasers, is
subject to certain of the civil liability provisions under the Securities Act in
connection with such sales and is bound by the provisions of the Registration
Rights Agreement, including certain indemnification obligations.
In the event that the Shelf Registration Statement has not been filed with
the Commission within 60 days or, if so filed, has not been declared effective
within 120 days following the Issue Date (each a "Registration Default"), a
Registration Penalty (as defined herein) of 0.25% per annum of the principal
amount of the Series A Subordinated Debentures will accrue until such Shelf
Registration Statement is (i) filed with the Commission or (ii) declared
effective by the Commission. In the event that the Shelf Registration Statement
is not declared effective by the Commission 60 days following a Registration
Default, an additional Registration Penalty of 0.25% (together with the initial
Registration Penalty, not to exceed in the aggregate 0.50%) will accrue until
such Registration Statement is declared effective.
Also, in the event that the Shelf Registration Statement ceases to be
effective during the Effectiveness Period for more than 60 days, whether or not
consecutive, during any 12-month period, then a Registration Penalty will accrue
at a rate per annum equal to one-half of one percent (0.50%) of the principal
amount or Liquidation Amount, as applicable, from such 61st day until such time
as the Shelf Registration Statement again becomes effective. At no time will a
Registration Penalty in excess of 0.50% be payable pursuant to the provisions of
the Registration Rights Agreement.
The Corporation and the Series A Issuer have agreed in the Registration
Rights Agreement to use their reasonable best efforts to cause the Series A
Preferred Securities to be listed on the Nasdaq National Market or other
national securities exchange upon effectiveness of the Shelf Registration
Statement.
The summary herein of certain provisions of the Registration Rights
Agreement is subject to, and is qualified in its entirety by reference to, all
of the provisions of the Registration Rights Agreement, a copy of which is
available upon request from the Corporation.
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<PAGE>
VALIDITY OF SECURITIES
Certain matters of Delaware law relating to the validity of the Series A
Preferred Securities, the enforceability of the Trust Agreement and the
formation of the Series A Issuer have been passed upon by Richards, Layton &
Finger, special Delaware Counsel to the Corporation and the Series A Issuer. The
validity of the Series A Guarantee and the Series A Subordinated Debentures have
been passed upon for the Corporation by Sullivan & Cromwell and for the
Underwriters by Simpson Thacher & Bartlett, (a partnership which includes
professional corporations). Sullivan & Cromwell and Simpson Thacher & Bartlett
have relied on the opinion of Richards, Layton & Finger as to certain matters of
Delaware law. Certain matters relating to United States federal income tax
considerations have been passed upon for the Corporation and the Series A
Issuers by Sullivan & Cromwell.
INDEPENDENT PUBLIC ACCOUNTANTS
The consolidated financial statements and schedules of the Corporation and
subsidiaries appearing in the Corporation's Annual Report (Form 10-K) for the
year ended December 31, 1995 have been audited by Arthur Andersen LLP,
independent public accountants, as indicated in their report with respect
thereto, and are included therein and have been incorporated by reference into
this Prospectus. Such consolidated financial statements are incorporated herein
by reference in reliance upon such report given upon the authority of such firm
as experts in giving said reports.
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<PAGE>
No dealer, salesperson or other person has been authorized to give any
information or to make any representations not contained in this Prospectus and,
if given or made, such information or representation must not be relied upon as
having been authorized by the Corporation or the Series A Issuer. This
Prospectus does not constitute an offer to sell or a solicitation of an offer to
buy any of the securities offered hereby in any jurisdiction to any person to
whom it is unlawful to make such offer or solicitation in such jurisdiction.
Neither the delivery of this Prospectus nor any sale made hereunder shall under
any circumstances create any implication that the information herein is correct
as of any time subsequent to the date hereof or that there has not been a change
in the affairs of the Corporation or the Series A Issuer since the date hereof.
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TABLE OF CONTENTS
------------------
Page
----
Notice to New Hampshire Residents............................ 6
Available Information........................................ 6
Incorporation of Certain Documents By Reference.............. 7
Prospectus Summary........................................... 8
Risk Factors................................................. 15
The Series A Issuer.......................................... 21
The Corporation.............................................. 21
Consolidated Ratio of Earnings to Fixed Charges (Excluding
Preferred Stock Dividends) and Ratio of Earnings to
Combined Fixed Charges and Preferred Stock Dividend
Requirements............................................... 24
Capitalization............................................... 25
Use of Proceeds.............................................. 26
Federal Reserve Board Actions................................ 26
Accounting Treatment......................................... 26
Description of the Series A Preferred Securities............. 26
Description of the Series A Subordinated Debentures.......... 35
Book-Entry Issuance.......................................... 45
Description of the Series A Guarantee........................ 46
Relationship Among the Series A Preferred Securities, the
Series A Subordinated Debentures, the Expense Agreement
and the Series A Guarantee................................. 49
Certain Federal Income Tax Consequences...................... 51
ERISA Considerations......................................... 54
Selling Securityholders...................................... 56
Plan of Distribution......................................... 57
Registration Rights Agreement................................ 58
Validity of Securities....................................... 60
Independent Public Accountants............................... 60
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[LOGO APPEARS HERE]
Riggs Capital
---------------
$150,000,000
8 5/8% Trust Preferred Securities, Series A
150,000
Preferred Securities
(Liquidation Amount $1,000 per
Preferred Security)
Fully and Unconditionally
Guaranteed by
Riggs National Corporation
-----------------------
PROSPECTUS
-----------------------
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<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The estimated expenses in connection with the issuance and distribution of
the securities being registered are:
Securities and Exchange Commission registration fee.................. $45,460
Trustee's fee and expenses........................................... $46,000
Printing and engraving expenses...................................... $150,000
Legal fees and expenses of Registrant's Counsel...................... $400,000
Accounting fees and expenses......................................... $65,000
Blue Sky fees and expenses (including counsel fees).................. $4,000
Fees of rating agencies.............................................. $90,000
Miscellaneous expenses............................................... $89,540
Total.............................................................. $890,000
Item 15. Indemnification of Directors and Officers
Section 15 of the General Corporation Law of the State of Delaware, Article
Eleventh of the Corporation's Certificate of Incorporation and Section 14.1 of
the Corporation's Bylaws provide for indemnification of the Corporation's
directors and officers in a variety of circumstances which may include
liabilities under the Securities Act.
The general effect of the provisions in the Corporation's Certificate of
Incorporation and Delaware General Corporation Law is to provide that the
Corporation shall indemnify its directors and officers against expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by them in connection with the defense or
settlement of any judicial or administrative proceedings in which they become
involved by reason of their status as directors or officers of the Corporation,
if they acted in good faith and in the reasonable belief that their conduct was
neither unlawful (in the case of criminal proceedings) nor inconsistent with the
best interests of the Corporation. With respect to legal proceedings by or in
the right of the Corporation in which a director or officer is adjudged liable
for improper performance of his duty to the Corporation or another enterprise
which he served in a similar capacity at the request of the Corporation,
indemnification is limited by such provisions to that amount which is permitted
by the court. In addition, the Corporation has purchased insurance as permitted
by Delaware law on behalf of directors, officers, employees or agents, which may
cover liabilities under the Securities Act.
In addition, Article Eleventh of the Corporation's Certificate of
Incorporation provides that no director of the Corporation will be personally
liable to the Corporation or its stockholders for monetary damages for breach of
fiduciary duty as a director. This provision does not eliminate or limit the
liability of a director for: (i) breach of the director's duty of loyalty to the
Corporation or its stockholders; (ii) acts or omissions not in good faith or
that involve intentional misconduct or a knowing violation of law; (iii) willful
or negligent conduct in paying illegal dividends or improperly purchasing or
redeeming the Corporation's own stock; or (iv) any transaction in which the
director obtains an improper personal benefit.
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<PAGE>
Item 16. Exhibits
<TABLE>
<CAPTION>
Exhibit
- -------
<S> <C>
1 - Purchase Agreement
4(a) - Certificate of Incorporation of the Corporation, as amended
4(b) - By-laws of the Corporation, as amended
4(c) - Junior Subordinated Indenture between Riggs National Corporation and The Bank of New
York, as Debenture Trustee
4(d) - Certificate of Trust of Riggs Capital
4(e) - Trust Agreement of Riggs Capital
4(f) - Amended and Restated Trust Agreement of Riggs Capital
4(g) - Form of Series A Preferred Security Certificate for Riggs Capital (included in
Exhibit 4(f))
4(h) - Guarantee Agreement for Riggs Capital
4(i) - Form of Series A Subordinated Debenture
5(a) - Opinion of Sullivan & Cromwell as to validity of the Series A Subordinated Debentures
and the Guarantee to be issued by Riggs National Corporation
5(b) - Opinion of Richards, Layton & Finger, special Delaware counsel, as to validity of the
Series A Preferred Securities to be issued by Riggs Capital
8 - Opinion of Sullivan & Cromwell as to certain federal income tax matters
12 - Statement re: Computation of Consolidated Ratio of Earnings to Fixed Charges
(Excluding Preferred Stock Dividends) and Ratio of Consolidated Earnings to Fixed
Charges and Preferred Stock Dividends
23(a) - Consent of Arthur Andersen LLP
23(b) - Consent of Richards, Layton & Finger
23(c) - Consent of Sullivan & Cromwell
24 - Powers of Attorney (included in signature page)
25(a)* - Form T-1 Statement of Eligibility of The Bank of New York to act as trustee under the
Junior Subordinated Indenture
25(b)* - Form T-1 Statement of Eligibility of The Bank of New York to act as trustee under the
Amended and Restated Trust Agreement of Riggs Capital
25(c)* - Form T-1 Statement of Eligibility of The Bank of New York to act as trustee under the
Guarantee for the benefit of the holders of Series A Capital
</TABLE>
* To be filed by amendment.
Item 17. Undertakings
Each of the undersigned Registrants hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after the
effective date of this Registration Statement (or the most recent
post-effective amendment thereto) which, individually or in the
aggregate, represent a fundamental change in the information set
forth in this Registration Statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that which
was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424 (b) if, in
the aggregate, the changes in volume and price represent no more
than a 20% change in the maximum
-65-
<PAGE>
aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement; and
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in this Registration Statement
or any material change to such information in this Registration
Statement;
provided, however, that paragraphs (1) (i) and (1) (ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by each of the Registrants pursuant to Section 13 or Section 15(d) of
the Securities Exchange Act of 1934 that are incorporated by reference in this
Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(4) That, for purposes of determining any liability under the Securities
Act of 1933, as amended, each filing of a Registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 that is
incorporated by reference in this Registration Statement shall be deemed to be a
new registration statement relating to the securities offered herein, and the
offering of such securities at this time shall be deemed to be the initial bona
fide offering hereof.
(5) That, for purposes of determining any liability under the Securities
Act of 1933:
(i) The information omitted from the form of prospectus filed as part of
this Registration Statement in reliance upon Rule 430A and contained in the form
of prospectus filed by the Registrants pursuant to Rule 424 (b) (1) or (4) or
487 (h) under the Securities Act shall be deemed to be part of this Registration
Statement as of the time it was declared effective.
(ii) Each post-effective amendment that contains a form of prospectus shall
be deemed to be a new Registration Statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of each
Registrant pursuant to the provisions described under Item 15 above, or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by each
Registrant of expenses incurred or paid by a director, officer or controlling
person of each Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, each Registrant will, unless in
the opinion of its counsel the matter has been settled by the controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
-66-
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets all
the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Washington, D.C. on February 6, 1997.
RIGGS NATIONAL CORPORATION
/s/ LINDA A. MADRID
------------------------------
Name: Linda A. Madrid
Title: Managing Director of Legal Affairs
and Corporate Secretary
Pursuant to the requirements of the Securities Act of 1933, this
registration statement or amendment has been signed by the following persons in
the capacities and on the dates indicated:
Title Date
* Chairman of the Board February 6, 1997
- ------------------------------ and Chief Executive
(Joe L. Allbritton) Officer
* President February 6, 1997
- ------------------------------
(Timothy C. Coughlin)
/s/ John L. Davis Chief Financial Officer February 6, 1997
- ------------------------------ (Principal Financial and
(John L. Davis) Accounting Officer)
* Director February 6, 1997
- ------------------------------
(Barbara B. Allbritton)
* Director February 6, 1997
- ------------------------------
(Robert L. Allbritton)
* Director February 6, 1997
- ------------------------------
(Frederick L. Bollerer)
* Director February 6, 1997
- ------------------------------
(Calvin Cufritz)
* Director February 6, 1997
- ------------------------------
(Charles A. Camalier, III)
* Director February 6, 1997
- ------------------------------
(Ronald E. Cuneo)
* Director February 6, 1997
- ------------------------------
(Floyd E. Davis, III)
* Director February 6, 1997
- ------------------------------
(Jacqueline C. Duchange)
* Director February 6, 1997
- ------------------------------
(Michela A. English)
-67-
<PAGE>
Title Date
* Director February 6, 1997
- ------------------------------
(James E. Fitzgerald)
* Director February 6, 1997
- ------------------------------
(Heather S. Foley)
* Director February 6, 1997
- ------------------------------
(David J. Gladstone)
* Director February 6, 1997
- ------------------------------
(Lawrence I. Hebert)
* Director February 6, 1997
- ------------------------------
(Michael J. Jackson)
* Director February 6, 1997
- ------------------------------
(Timothy A. Lex)
* Director February 6, 1997
- ------------------------------
(Leo J. O'Donovan, S.J.)
* Director February 6, 1997
- ------------------------------
(Steven B. Pfeiffer)
* Director February 6, 1997
- ------------------------------
(John A. Sargent)
* Director February 6, 1997
- ------------------------------
(Robert L. Sloan)
* Director February 6, 1997
- ------------------------------
(James W. Symington)
* Director February 6, 1997
- ------------------------------
(Jack Valenti)
* Director February 6, 1997
- ------------------------------
(Eddie N. Williams)
*Linda A. Madrid, by signing her name hereto, signs this document on behalf of
each of the persons indicated by an asterisk above pursuant to powers of
attorney duly executed by such persons and filed herewith with the Securities
and Exchange Commission.
By: /s/ Linda A. Madrid
---------------------------
Linda A. Madrid, Attorney-in-fact
-68-
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, Riggs Capital,
certifies that it has reasonable grounds to believe that it meets all the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Washington, D.C. on February 6, 1997.
RIGGS CAPITAL
By: RIGGS NATIONAL CORPORATION,
as Depositor
/s/ LINDA A. MADRID
---------------------------
Name: Linda A. Madrid
Title: Managing Director of Legal Affairs
and Corporate Secretary
-69-
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
- -------
<S> <C>
1 - Purchase Agreement
4(a) - Certificate of Incorporation of the Corporation, as amended
4(b) - By-laws of the Corporation, as amended
4(c) - Junior Subordinated Indenture between Riggs National Corporation and The Bank
of New York, as Debenture Trustee
4(d) - Certificate of Trust of Riggs Capital
4(e) - Trust Agreement of Riggs Capital
4(f) - Amended and Restated Trust Agreement of Riggs Capital
4(g) - Form of Series A Preferred Security Certificate for Riggs Capital (included in
Exhibit 4(f))
4(h) - Guarantee Agreement for Riggs Capital
4(i) - Form of Series A Subordinated Debenture
5(a) - Opinion of Sullivan & Cromwell as to validity of the Series A Subordinated
Debentures and the Guarantee to be issued by Riggs National Corporation
5(b) - Opinion of Richards, Layton & Finger, special Delaware counsel, as to validity
of the Series A Preferred Securities to be issued by Riggs Capital
8 - Opinion of Sullivan & Cromwell as to certain federal income tax matters
12 - Statement re: Computation of Consolidated Ratio of Earnings to Fixed Charges
(Excluding Preferred Stock Dividends) and Ratio of Earnings to Fixed Charges
and Preferred Stock Dividends
23(a) - Consent of Arthur Andersen LLP
23(b) - Consent of Richards, Layton & Finger
23(c) - Consent of Sullivan & Cromwell
24 - Powers of Attorney (included in signature page)
25(a)* - Form T-1 Statement of Eligibility of The Bank of New York to act as trustee
under the Junior Subordinated Indenture
25(b)* - Form T-1 Statement of Eligibility of The Bank of New York to act as trustee
under the Amended and Restated Trust Agreement of Riggs Capital
25(c)* - Form T-1 Statement of Eligibility of The Bank of New York to act as trustee
under the Guarantee for the benefit of the holders of Series A Capital
</TABLE>
*To be filed by amendment.
-70-
<PAGE>
================================================================================
RIGGS CAPITAL
__________________
8.625% Trust Preferred Securities
guaranteed by
RIGGS NATIONAL CORPORATION
PURCHASE AGREEMENT
------------------
Dated December 10, 1996
- --------------------------------------------------------------------------------
<PAGE>
RIGGS CAPITAL
_________________
8.625% Trust Preferred Securities
PURCHASE AGREEMENT
------------------
December 10, 1996
DILLON, READ & CO. INC.
FRIEDMAN, BILLINGS, RAMSEY & CO., INC.
c/o Dillon, Read & Co. Inc.
535 Madison Avenue
New York, New York 10022
Ladies and Gentlemen:
Riggs Capital (the "Issuer"), a statutory business trust formed under
the Business Trust Act (the "Delaware Act") of the State of Delaware (Chapter
38, Title 12, of the Delaware Code, 12 Del. C. Section 3801 et seq.), proposes
-- ---
to issue and sell to Dillon, Read & Co. Inc. ("Dillon, Read") and Friedman,
Billings, Ramsey & Co., Inc. and each of the other Initial Purchasers named in
Schedule A hereto (collectively, the "Initial Purchasers," which term shall also
include any initial purchaser substituted as hereinafter provided in Section 9
hereof), for whom you are acting as representatives (the "Representatives"), an
aggregate of 150,000 8.625% Trust Preferred Securities, Liquidation Amount
$1,000 per Preferred Security (the "Preferred Securities"). The Preferred
Securities are more fully described in the Offering Memorandum referred to
below.
The Preferred Securities will be guaranteed by Riggs National
Corporation (the "Company"), to the extent set forth in the Offering Memorandum
(as defined below), with respect to distributions and amounts payable upon
liquidation or redemption (the "Guarantee"), pursuant to the Guarantee Agreement
(the "Guarantee Agreement"), to be dated as of the Closing Time (as defined
below), executed and delivered by the Company and The Bank of New York (the
"Guarantee Trustee"), a New York banking corporation, not in its individual
capacity but solely as trustee, for the benefit of the holders from time to time
of the Preferred Securities. The proceeds from the sale of the Preferred
Securities to the Initial Purchasers will be aggregated with the entire proceeds
from the sale by the Issuer to the Company of the common securities of the
Issuer (the "Common Securities") and will be used by the Issuer to purchase the
8.625% Junior Subordinated Deferrable Interest Debentures due 2026 (the
"Debentures") issued by the Company. The Preferred Securities and the Common
Securities will be issued pursuant to the Amended and Restated Trust Agreement
of the Issuer, to be dated as of the Closing Time (the "Trust Agreement"), among
the Company, as
<PAGE>
Depositor, the trustees named therein (the "Trustees") and the holders from time
to time of the Preferred Securities and the Common Securities, which represent
undivided beneficial interests in the assets of the Issuer. The Debentures will
be issued pursuant to a Junior Subordinated Indenture, to be dated as of the
Closing Time (the "Indenture"), between the Company and The Bank of New York, as
trustee (the "Indenture Trustee"). All expenses of the Issuer will be paid by
the Company as set forth in the Expense Agreement, to be dated as of the Closing
Time (the "Expense Agreement"). The Preferred Securities, the Guarantee and the
Debentures are collectively referred to herein as the "Securities". This
Agreement, the Indenture, the Trust Agreement, the Guarantee Agreement, the
Expense Agreement and the Registration Rights Agreement (as defined below) are
referred to collectively as the "Operative Documents". Capitalized terms used
herein, without definition have the respective meanings specified in the
Offering Memorandum.
The Preferred Securities will be offered and sold to the Initial
Purchasers without registration under the Securities Act of 1933, as amended
(the "Securities Act"), in reliance upon exemptions from the registration
requirements of the Securities Act. In connection with the sale of the Preferred
Securities, the Issuer and the Company have prepared a preliminary offering
memorandum dated November 22, 1996 (the "Preliminary Offering Memorandum") and a
final offering memorandum dated the date hereof (such final offering memorandum,
in the form first furnished to the Initial Purchasers for use in connection with
the offering and sale of the Preferred Securities, or if such form is not so
used, in the form subsequently furnished for such use, the "Offering
Memorandum"), each setting forth certain information concerning the Issuer, the
Company, the Operative Documents and the Securities. Subject to the provisions
of Section 4(c) hereof, the Issuer and the Company hereby confirm that they
have authorized the use of the Preliminary Offering Memorandum and the Offering
Memorandum in connection with the offer and resale of the Preferred Securities
by the Initial Purchasers. Unless stated to the contrary, all references herein
to the Offering Memorandum are to the Offering Memorandum at the date hereof
(the "Execution Time") and are not meant to include any amendment or supplement
thereto subsequent to the Execution Time.
The Issuer and the Company understand that the Initial Purchasers
propose to make an offering of the Preferred Securities only on the terms,
subject to the conditions and in the manner set forth in the Offering Memorandum
and Section 3 hereof, as soon as the Initial Purchasers deem advisable after
this Agreement has been executed and delivered.
The Initial Purchasers and other holders of Securities (including
subsequent permitted transferees) will be entitled to the benefits of the
registration rights agreement, to be dated as of the Closing Time (the
"Registration Rights Agreement"), among the Issuer, the Company and the Initial
Purchasers, in the form attached hereto as Exhibit A. Pursuant to the
Registration Rights Agreement, the Issuer and the Company will agree to file
with the Securities and Exchange Commission (the "Commission") upon the terms
and conditions set forth therein a shelf registration statement pursuant to Rule
415 under the Securities Act in respect of (i) the Preferred Securities, (ii)
the Guarantee and (iii) the Debentures, and to use their reasonable best efforts
to cause such shelf registration statement to be declared effective.
All references in this Agreement to financial statements and schedules
and other information that is "contained", "included", "deemed included" or
"stated" in the Offering Memorandum (and all other references of like import)
shall be deemed to include all
<PAGE>
such financial statements and schedules and other information that are, or are
deemed to be, incorporated by reference in the Offering Memorandum; and all
references in this Agreement to amendments or supplements to the Offering
Memorandum shall be deemed to include the filing of any document under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), that is, or is
deemed to be, incorporated by reference in the Offering Memorandum.
Section 1. Representations and Warranties. The Issuer and the
------------------------------
Company, jointly and severally, represent and warrant to and agree with the
Initial Purchasers that:
(i) As of their respective dates, none of the Offering
Memorandum or any amendment or supplement thereto, and as of the Closing
Time, the Offering Memorandum, as amended or supplemented to such time,
contained or will contain an untrue statement of a material fact or omitted
or will omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided, however, that neither the Company nor the
-------- -------
Issuer makes any warranty or representation with respect to any statement
or omission made in the Offering Memorandum or any amendment or supplement
thereto in reliance upon and in conformity with information furnished in
writing by or on behalf of any Initial Purchaser to the Company expressly
for use therein. The documents incorporated by reference or deemed to be
incorporated by reference in the Offering Memorandum (the "Exchange Act
Reports"), when they became effective or were last amended or filed with
the Commission, as the case may be, conformed in all material respects to
the requirements of the Exchange Act as applicable, and the rules and
regulations (the "Rules and Regulations") of the Commission, and none of
such documents contained an untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading, and any further documents so filed and incorporated
by reference or deemed to be incorporated by reference in the Offering
Memorandum, when such documents become effective or are filed with the
Commission, as the case may be, will conform in all material respects to
the requirements of the Securities Act and the Exchange Act and the Rules
and Regulations, as applicable, and shall not contain an untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(ii) Each of the Preferred Securities, the Guarantee and the
Debentures satisfy the eligibility requirements of Rule 144A(d)(3) of the
Rules and Regulations.
(iii) None of the Issuer, the Company, any of their respective
affiliates (as such term is defined in Rule 501(b) of Regulation D of the
Rules and Regulations ("Regulation D")), or any person acting on behalf of
the foregoing (other than an Initial Purchaser) has, directly or
indirectly, made or will, directly or indirectly, make offers or sales of
any security, or solicited offers to buy any security, under
<PAGE>
4
circumstances that would require the registration of the Securities under the
Securities Act.
(iv) None of the Issuer, the Company or any of their respective
affiliates (as such term is defined in Rule 501(b) of Regulation D) or any
person (other than an Initial Purchaser) acting on the behalf of the foregoing
has engaged or will engage, in connection with the offering of the Securities or
any security of the same class or series as the Securities, (A) in any form of
general solicitation or general advertising within the meaning of Rule 502(c)
of Regulation D or (B) in any directed selling efforts within the meaning of
Rule 902 of the Rules and Regulations in the United States in connection with
the Securities being offered and sold pursuant to Regulation S of the Rules and
Regulations, and each of the foregoing has complied with the offering
restrictions requirement of Regulation S of the Rules and Regulations. The
Company and the Issuer have not entered and will not enter into any
contractual arrangement with respect to the distribution of the Securities
except for this Agreement and the Registration Rights Agreement.
(v) Assuming the accuracy of the representations and warranties and
compliance with the agreements of the Initial Purchasers in Section 3 hereof, it
is not necessary in connection with the offer, sale and delivery of the
Preferred Securities to the Initial Purchasers, or in connection with the
initial resale of the Preferred Securities by the Initial Purchasers in
accordance with this Agreement, to register the Preferred Securities under the
Securities Act or to qualify the Indenture, the Guarantee or the Trust Agreement
under the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act").
(vi) The Company is a corporation duly incorporated, validly existing
and in good standing under the laws of the State of Delaware with the power and
authority to own, lease and operate its properties, to conduct its business and
to execute, deliver and perform its obligations under each of the Operative
Documents. Each subsidiary of the Company that is listed on Schedule B hereto
(such subsidiaries collectively called the "Material Subsidiaries") is a
corporation or national banking association duly incorporated or organized,
validly existing and in good standing under the laws of its jurisdiction of
incorporation or organization with power and authority to own, lease and operate
its properties and conduct its business as described in the Offering Memorandum.
(vii) The Issuer has been duly formed and is validly existing in good
standing as a business trust under the Delaware Act with the power and authority
to own property and to conduct its business as described in the Offering
Memorandum.
(viii) The Company and the Material Subsidiaries are duly qualified in
or licensed to transact business by, and are in good standing in, each
jurisdiction in which they own or lease real property, maintain an office or
conduct their respective businesses and in which the failure, individually or in
the aggregate with all other failures, to be so licensed or qualified or to be
in good standing would reasonably be
<PAGE>
5
expected to have a material adverse effect on the financial condition,
properties, assets, business, results of operations or prospects of the
Company and its subsidiaries taken as a whole (a "Material Adverse
Effect").
(ix) All of the outstanding shares of capital stock of the Company
have been duly authorized and validly issued and are fully paid and
nonassessable. All of the outstanding shares of capital stock of each
Material Subsidiary have been duly authorized and validly issued and are
fully paid and nonassessable and are owned, directly or indirectly, by the
Company free and clear of any pledge, lien, security interest, charge,
claim, equity or encumbrance of any kind.
(x) The Company had, at the date indicated in the Offering
Memorandum, a duly authorized, issued and outstanding capitalization as set
forth in the Offering Memorandum under the caption "Capitalization".
(xi) This Agreement has been duly authorized, executed and delivered
by each of the Company and the Issuer and is a legal, valid and binding
agreement of each of the Company and the Issuer enforceable in accordance
with its terms, except as the enforceability thereof may be limited by
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or
similar laws of general applicability relating to or affecting creditors'
rights and general equitable principles (the "Enforceability Exceptions")
and except to the extent that the indemnification provisions of Section 7
hereof may be limited by federal or state securities laws and public policy
considerations in respect thereof.
(xii) The Registration Rights Agreement has been duly authorized by
each of the Company and the Issuer and, at the Closing Time, will have been
executed and delivered by each of the Issuer and the Company and upon such
execution by each of the Issuer and the Company (assuming the due
authorization, execution and delivery thereof by the other parties thereto)
the Registration Rights Agreement will constitute a valid and legally
binding obligation of each of the Issuer and the Company enforceable
against each of the Issuer and the Company in accordance with the terms
thereof, except as enforcement thereof may be limited by the Enforceability
Exceptions, and except as any rights to indemnity may be limited by federal
and state securities laws and public policy considerations, and will
conform in all material respects to all statements relating thereto in the
Offering Memorandum.
(xiii) The Trust Agreement has been duly authorized by the Company
and, at the Closing Time, will have been executed and delivered by the
Company and the Administrative Trustees (as defined in the Trust
Agreement), and assuming the due authorization, execution and delivery of
the Trust Agreement by the Delaware Trustee and the Property Trustee (each
as defined in the Trust Agreement), the Trust Agreement will, at the
Closing Time, constitute a valid and legally binding obligation of the
Company, enforceable against the Company in accordance with its terms,
except as enforcement thereof may be limited by the Enforceability
Exceptions, and will
<PAGE>
6
conform in all material respects to all statements relating thereto in the
Offering Memorandum.
(xiv) The Guarantee Agreement has been duly authorized by the Company
and when executed and delivered by the Company, and assuming due
authorization, execution and delivery thereof by The Bank of New York, not
in its individual capacity but solely as trustee, will constitute a valid
and legally binding obligation of the Company enforceable against the
Company in accordance with its terms, except as enforcement thereof may be
limited by the Enforceability Exceptions, and will conform in all material
respects to all statements relating thereto in the Offering Memorandum.
(xv) The Expense Agreement has been duly authorized by the Company
and when executed and delivered by the Company, and assuming due
authorization, execution and delivery thereof by the Issuer, will
constitute a valid and legally binding obligation of the Company,
enforceable against the Company in accordance with its terms, except as
enforcement thereof may be limited by the Enforceability Exceptions, and
will conform in all material respects to all statements relating thereto in
the Offering Memorandum.
(xvi) The Preferred Securities have been duly authorized by the
Issuer and, when executed and authenticated in the manner provided for in
the Trust Agreement and issued and delivered pursuant to this Agreement
against payment of the consideration set forth herein, will be validly
issued and (subject to the terms of the Trust Agreement) fully paid and
nonassessable undivided beneficial interests in the assets of the Issuer,
will be entitled to the benefits of the Trust Agreement (and to the extent
set forth therein the Indenture) and will conform in all material respects
to all statements relating thereto in the Offering Memorandum; the issuance
of the Preferred Securities is not subject to preemptive or other similar
rights; and holders of Preferred Securities will be entitled to the same
limitation of personal liability extended to stockholders of private
corporations for profit incorporated under the General Corporation Law of
the State of Delaware.
(xvii) The Common Securities have been duly authorized by the Issuer
and, when executed, issued and delivered by the Issuer to the Company
against payment therefor as described in the Offering Memorandum, will be
validly issued and (subject to the terms of the Trust Agreement) fully paid
and nonassessable undivided beneficial interests in the assets of the
Issuer, will be entitled to the benefits of the Trust Agreement and will
conform in all material respects to the description thereof in the Offering
Memorandum; the issuance of the Common Securities is not subject to
preemptive or other similar rights; and at the Closing Time, all of the
issued and outstanding Common Securities of the Issuer will be directly
owned by the Company free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equity.
<PAGE>
7
(xviii) The Indenture has been duly authorized by the Company and
when executed and delivered by the Company, and assuming due authorization,
execution and delivery thereof by the Indenture Trustee, will constitute a
legal, valid and binding obligation of the Company, enforceable against the
Company in accordance with its terms, except as enforcement thereof may be
limited by the Enforceability Exceptions, and will conform in all material
respects to all statements relating thereto in the Offering Memorandum.
(xix) The Debentures have been duly authorized by the Company and,
when executed, authenticated, issued and delivered in the manner provided
for in the Indenture, will constitute valid and legally binding obligations
of the Company entitled to the benefits of the Indenture and enforceable
against the Company in accordance with their terms, except as enforcement
thereof may be limited by the Enforceability Exceptions, and will conform
in all material respects to all statements relating thereto in the Offering
Memorandum.
(xx) Except as disclosed in the Offering Memorandum, upon payment
by the Issuer of the purchase price therefor, the Trustee will, on the
Closing Date, have good and valid title to all such Debentures, free from
liens, encumbrances and defects that would materially affect the value
thereof or materially interfere with the use made or to be made thereof by
the Issuer.
(xxi) Arthur Andersen LLP ("Arthur Andersen"), who is reporting
upon the financial statements incorporated or deemed incorporated by
reference in the Offering Memorandum, are and were independent public
accountants as required by the Securities Act and the Rules and Regulations
during the periods covered by the financial statements which are
incorporated in the Offering Memorandum.
(xxii) The consolidated financial statements of the Company
incorporated or deemed incorporated by reference in the Offering Memorandum
present fairly the consolidated financial position of the Company as of the
dates indicated and the consolidated results of operations and changes in
stockholders' equity of the Company and its subsidiaries for the periods
specified. The consolidated financial statements of the Company
incorporated or deemed incorporated by reference in the Offering Memorandum
have been prepared in all material respects in conformity with generally
accepted accounting principles ("GAAP") applied on a consistent basis
throughout the periods involved (except as indicated in the notes thereto),
and the supporting schedules, if any, incorporated or deemed incorporated
by reference in the Offering Memorandum present fairly in accordance with
GAAP the information required to be stated therein. The selected
consolidated financial data and the summary financial information of the
Company included in the Offering Memorandum present fairly the information
shown therein and have been complied on a basis consistent with that of the
consolidated audited financial statements of the Company (to the extent so
indicated) incorporated or deemed incorporated by reference in the Offering
Memorandum.
<PAGE>
8
(xxiii) Since the respective dates as of which information is given
in the Offering Memorandum, except as may be otherwise stated therein,
there has not been (A) any material adverse change in the financial
condition, properties, assets, business, results of operations or prospects
of the Company and its subsidiaries taken as a whole, (B) any transaction
entered into by the Company or any of its subsidiaries, or into which the
Company or any of its subsidiaries intends to enter, which is material to
the Company and its subsidiaries taken as a whole, or (C) any obligation,
contingent or otherwise incurred, directly or indirectly, by the Company or
any of its subsidiaries which is material to the Company and its
subsidiaries taken as a whole.
(xxiv) None of the Company, any Material Subsidiary or the Issuer
(A) is in breach of, or in default in (nor has any event occurred which
with notice, lapse of time, or both, would constitute a breach of, or
default in) the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage, deed
of trust, bank loan or credit agreement, note, lease or other agreement or
instrument to which it is a party or by which it may be bound or to which
any of its properties may be subject (collectively, the "Agreements and
Instruments"), except for any such breaches or defaults which, individually
or in the aggregate with all other breaches or defaults, would not have a
Material Adverse Effect or have an adverse effect on the legality, validity
or enforceability of any of the Operative Documents or (B) is in breach of,
or in default under (nor has any event occurred which with notice,lapse of
time, or both would constitute a breach of, or default under) its
respective charter or by-laws. The execution, delivery and performance of
this Agreement and the Registration Rights Agreement by the Company and the
Issuer, the issuance, sale and delivery of the Preferred Securities and the
Common Securities by the Issuer, the issuance, sale and delivery of the
Debentures by the Company, the execution, delivery and performance by the
Company of this Agreement, the Trust Agreement, the Indenture, the
Guarantee Agreement, the Expense Agreement and the Registration Rights
Agreement, the consummation by the Company and the Issuer of the
transactions contemplated hereby and thereby, compliance by the Company and
the Issuer with the terms of the forgoing and the application of the
proceeds from the sale of the Preferred Securities as contemplated by the
Offering Memorandum (A) have been duly authorized by all necessary action
on the part of the Company and the Issuer, (B) do not and will not conflict
with or result in any breach of or constitute a default under (nor
constitute any event which with notice, lapse of time, or both would
constitute a breach of, or default under) any provision of the charter or
by-laws of the Company or any Material Subsidiary or any provision of the
Trust Agreement, (C) do not and will not conflict with or result in any
breach of or constitute a default under (nor constitute any event which
with notice, lapse of time, or both would constitute a breach of, or
default under) any of the terms or provisions of, or give rise to any right
to accelerate the maturity or require the prepayment of any indebtedness
under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company, any Material
Subsidiary or the Issuer under any such Agreement or Instrument (except,
with respect to this clause (C), for such conflicts, breaches, defaults,
accelerations, prepayments or liens, charges or encumbrances which,
individually or in the aggregate
<PAGE>
9
with all other conflicts, breaches, defaults, accelerations, prepayments or
liens, charges or encumbrances, would not have a Material Adverse Effect or
have an adverse effect on the legality, validity or enforceability if any
of the Operative Documents) and (D) do not and will not conflict with, or
result in any breach of or constitute a default under (nor constitute any
event which with notice, lapse of time, or both would constitute a breach
of, or default under), any federal, state, local or English law, regulation
or rule or any decree, judgement or order applicable to the Company, any
Material Subsidiary or the Issuer.
(xxv) No approval, authorization, consent or order of or filing with
any national, state or local governmental or regulatory commission, board,
body, authority or agency is required in connection with the initial
offering, issuance or sale of the Securities by the Issuer, and the
Guarantee and the Debentures by the Company, or is required for the valid
authorization, execution, delivery and performance by the Company and the
Issuer of their respective obligations under the Operative Documents or the
consummation by the Company and the Issuer of the transactions contemplated
therein, except for such authorizations as may be required by the
securities or "blue sky" laws of the various states in connection with the
offer and sale of the Securities or by the federal and state securities
laws in connection with the registration obligations under the Registration
Rights Agreement.
(xxvi) Except as disclosed in the Offering Memorandum, there is no
action, suit or proceeding before or by any government, governmental
instrumentality or court, domestic or foreign, now pending or, to the
knowledge of the Company, threatened against the Company, its subsidiaries
or the Issuer that, individually or in the aggregate with all other
actions, suits or proceedings, is reasonably expected by the Company to
materially and adversely affect the consummation of the transactions
contemplated by this Agreement. The aggregate of all pending legal or
governmental proceedings to which any of the Company, its subsidiaries and
the Issuer are party that are not described in the Offering Memorandum,
including ordinary routine litigation incidental to the business of any of
the Company, its subsidiaries and the Issuer, as the case may be, is not
reasonably expected by the Company to have a Material Adverse Effect.
(xxvii) Neither the Issuer nor the Company is, or after giving effect
to the consummation of the transactions contemplated herein, will be, and
neither the Company nor the Issuer is directly or indirectly controlled by,
or acting on behalf of any person which is, an "investment company" within
the meaning of the Investment Company Act of 1940, as amended (the "1940
Act").
(xxviii) The Preferred Securities have been designed PORTAL eligible
securities in accordance with the rules and regulations of the National
Association of Securities Dealers, Inc. ("NASD").
(xxix) Other than pursuant to this Agreement or as disclosed in the
Offering Memorandum under the caption "Plan of Distribution", there are no
contracts,
<PAGE>
10
agreements or understandings between either the Issuer or the Company and
any person that give rise to a valid claim against the Issuer, the Company
or any Initial Purchaser for a brokerage commission, finder's fee or other
like payment.
(xxx) Except as set forth in the Registration Rights Agreement or as
described in the Offering Memorandum, there are no contracts, agreements or
understandings between the Company and any person granting such person the
right to require the Company to file a registration statement under the
Securities Act with respect to any securities of the Company owned or to be
owned by such person or to require the Company to include such securities
in the securities to be covered by the shelf registration statement
referred to in the Registration Rights Agreement.
(xxxi) The Company and each of its Material Subsidiaries has all
necessary licenses, authorizations, consents and approvals and has made all
necessary filings required under any federal, state, local or foreign law,
regulation or rule, and has obtained all necessary authorizations, consents
and approvals from other persons, in order to conduct its respective
business, except where any failures to obtain any such licenses,
authorizations, consents or approvals, or to make any such filings, would
not, individually or in the aggregate with all other such failures,
reasonably be expected to have a Material Adverse Effect; neither the
Company nor any of its Material Subsidiaries is in violation of, or in
default under, any such license, authorization, consent or approval or any
federal, state, local or foreign law, regulation or rule or any decree,
order or judgement applicable to the Company or any of its Material
Subsidiaries the effect of which, individually or in the aggregate with all
other violations and defaults, would reasonably be expected to have a
Material Adverse Effect.
(xxxii) The Company is duly registered as a bank holding company under
the Bank Holding Company Act of 1956, as amended; the deposit accounts of
each of the Company's domestic bank subsidiaries are insured by the Bank
Insurance Fund of the Federal Deposit Insurance Corporation ("FDIC") to the
fullest extent permitted by law and the rules and regulations of the FDIC,
and no proceedings for the termination of such insurance are pending or, to
the best of the Company's knowledge, threatened; and neither the Company
nor any of its Material Subsidiaries is party to or otherwise the subject
of any consent decree, memorandum of understanding, written commitment or
other written supervisory agreement with the Board of Governors of the
Federal Reserve System (the "Federal Reserve"), the Office of the
Comptroller of the Currency (the "OCC") or any other federal or state
authority or agency charged with the supervision or insurance of depositary
institutions or their holding companies.
Section 2. Sale and Delivery to the Initial Purchasers; Closing. (a)
----------------------------------------------------
On the basis of the representations and warranties herein contained, and subject
to the terms and conditions herein set forth, the Issuer agrees to sell to each
Initial Purchaser, and each Initial Purchaser agrees, severally and not jointly,
to purchase from the Issuer, at the purchase price of $1,000 per Preferred
Security, an aggregate of 150,000 Preferred Securities (except as otherwise
provided in this Agreement, to be allocated to the Initial Purchasers in the
number
<PAGE>
11
of Preferred Securities set forth opposite the name of each initial Purchaser in
Schedule A hereto).
(b) As compensation to the Initial Purchasers for their commitments
hereunder and in view of the fact that the proceeds of the sale of the Preferred
Securities and the Common Securities will be used to purchase the Debentures,the
Company hereby agrees to pay at the Closing Time to the Representatives, for the
accounts of the Initial Purchasers, a commission of $25.00 per Preferred
Security purchased by the Initial Purchasers by wire transfer of immediately
available funds to a bank account designated by the Representatives.
(c) Payment of the purchase price for, and delivery of certificates
for, the Preferred Securities shall be made at the offices of Sullivan &
Cromwell, 1701 Pennsylvania Avenue, N.W. Washington, D.C. 20006, at 10:00 A.M.,
New York City time, on December 13, 1996 or such later date and time not more
than two full business days thereafter as you the Company and the Issuer shall
mutually determine (such date and time of payment and delivery being herein
called the "Closing Time"). Payment shall be made to the Issuer by wire transfer
of immediately available funds to a bank account designated by the Issuer
against delivery by or on behalf of the Issuer to the Initial Purchasers for the
respective accounts of the Initial Purchasers of the Preferred Securities.
(d) Certificates for the Preferred Securities shall be in such
denominations and registered in such names as you may request in writing at
least two full business days before the Closing Time. The certificates for the
Preferred Securities will be made available in New York City for examination and
packaging by you not later than 10:00 A.M. on the business day immediately prior
to the Closing Time.
(e) It is understood that each Initial Purchaser has authorized you,
for its account, to accept delivery of, receipt for, and make payment of the
purchase price for, the Preferred Securities that it has agreed to purchase. You
may (but shall not be obligated to) make payment of the purchase price for the
Preferred Securities to be purchased by any Initial Purchaser whose funds shall
not have been received by the Closing Time, but such payment shall not relieve
such Initial Purchaser from its obligations hereunder.
Section 3. Resale of the Securities. Each Initial Purchaser severally
------------------------
and not jointly represents and warrants to, and agrees with, the Issuer and the
Company that:
(a) it is a "Qualified Institutional Buyer" as defined in Rule 144A of
the Rules and Regulations (a "Qualified institutional Buyer") and an "accredited
investor" within the meaning of Rule 501(a) of Regulation D (an "Accredited
Investor");
(b) it has not offered or sold, and will not offer or sell, any
Preferred Securities (which for purposes of this Section 3 includes the
Guarantee, unless the context requires otherwise) except to persons whom it
reasonably believes to be (i) in the case of offers inside the United States (A)
Qualified Institutional Buyers or (B) Accredited Investors that, prior to their
purchase of the Preferred Securities, deliver to it a letter affirming the
representations and agreements set forth under the caption "Transfer
Restrictions" in the
<PAGE>
12
Offering Memorandum or otherwise acceptable to the Company or (ii) in the case
of offers and sales outside the United States, to persons other than "U.S.
Persons" (within the meaning of Regulation S);
(c) it has not made and will not make offers or sales of the Preferred
Securities in the United States by means of any form of general solicitation or
general advertising (within the meaning of Regulation D) or in any manner
involving a public offering (within the meaning of Section 4(2) under the
Securities Act) in the United States prior to the effectiveness of a
registration statement with respect to the Securities; and
(d) with respect to offers and sales outside the United States:
(i) it understands that no action has been or will be taken in any
jurisdiction by the Issuer or the Company that would permit a public
offering of the Securities, or possession or distribution of the Offering
Memorandum or any other offering or publicity material relating to the
Securities, in any country or jurisdiction where action for that purpose is
required;
(ii) it will comply with all applicable laws and regulations in each
jurisdiction in which it acquires, offers, sells or delivers Securities or
has in its possession or distributes the Offering Memorandum or any such
other material, in all cases at its own expense;
(iii) the Securities have not been and will not be registered under
the Securities Act and may not be offered or sold within the United States
or to, or for the account or benefit of, U.S. persons, except in accordance
with Regulation S under the Securities Act pursuant to another exemption
from the registration requirements of the Securities Act;
(iv) it has offered the Securities and will offer and sell the
Securities (A)(x) as part of its distribution at any time and (y) otherwise
until 40 days after the later of the commencement of the offering of
the Securities and the Closing Time, in each case only in accordance with
Rule 903 of Regulation S or (B) pursuant to another exemption from the
registration requirements of the Securities Act. Accordingly, neither such
Initial Purchaser, its affiliates nor any persons acting on its or their
behalf has engaged or will engage in any directed selling efforts (within
the meaning of Regulation S) with respect to the Securities, and such
Initial Purchaser, its affiliates and any such persons has complied and
will comply with the offering restrictions requirements of Regulation S in
connection with the offering of the Securities;
(v) it agrees that, at or prior to confirmation of sales of the
Securities, it will have sent to each distributor, dealer or person
receiving a selling concession, fee or other remuneration that purchases
Securities from it during the restricted period a confirmation or notice to
substantially the following effect;
<PAGE>
13
"The securities covered hereby have not been registered under the
U.S. Securities Act of 1933 (the "Securities Act") and may not be
offered and sold within the United States or to, or for the account or
benefit of, U.S. persons (i) as part of their distribution at any time
or (ii) otherwise until 40 days after the later of the commencement of
the offering and the closing of the offering, except in either case in
accordance with Regulation S under the Securities Act. Terms used
above have the meaning given to them by Regulation S."
Section 4. Certain Covenants of the Issuer and the Company. The Issuer
-----------------------------------------------
and the Company covenant with each Initial Purchaser as follows:
(a) The Issuer and the Company will promptly deliver to the Initial
Purchasers and counsel for the Initial Purchasers, without charge, as many
copies of the Preliminary Offering Memorandum, the Offering Memorandum, any
amendments or supplements thereto, the documents incorporated or deemed
incorporated by reference in the Offering Memorandum and the Operative Documents
as the Initial Purchasers and their counsel may reasonably request.
(b) The Company and the Issuer will give the Initial Purchasers timely
notice of their intention to prepare any amendment or supplement to the
Preliminary Offering Memorandum or the Offering Memorandum or to file with the
Commission any document incorporated by reference in the Offering Memorandum,
will furnish the Initial Purchasers and counsel to the Initial Purchasers with
copies of any such amendment, supplement or document and will obtain the consent
of the Initial Purchasers to any such amendment or supplement or to any such
filing (which consent shall not be unreasonably withheld or delayed).
(c) If at any time prior to completion of the distribution of the
Preferred Securities (which for purposes of this Section 4 includes the
Guarantee, unless the context otherwise requires) by the Initial Purchasers to
purchasers who are not their affiliates (as determined by you) any event shall
occur or condition exist as a result of which it is necessary, in the reasonable
opinion of the Initial Purchasers, counsel for the Initial Purchasers or counsel
for the Company, to amend or supplement the Offering Memorandum in order that
the Offering Memorandum, as then amended or supplemented, will not include an
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances
existing at the time it is delivered to a purchaser, not misleading or if, in
the reasonable opinion of the Initial Purchasers, counsel to the Initial
Purchasers or counsel to the Company, such amendment or supplement is necessary
to comply with applicable law, the Issuer and the Company will, subject to
paragraph (b) of this Section 4, promptly prepare such amendment or supplement
as may be necessary to correct such untrue statement or omission or to effect
such compliance (in form and substance reasonably agreed upon by counsel to the
Initial Purchasers), so that as so amended or supplemented, the statements in
the Offering Memorandum will not include an untrue statement of a material fact
or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances existing at the time it is delivered
to a purchaser, not misleading or so that
<PAGE>
14
such Offering Memorandum as so amended or supplemented will comply with
applicable law, as the case may be, and furnish to the Initial Purchasers such
number of copies of such amendment or supplement as the Initial Purchasers may
reasonably request. The Issuer and the Company agree to notify the Initial
Purchasers in writing to suspend use of the Offering Memorandum as promptly as
practicable after the occurrence of an event specified in this paragraph (c),
and the Initial Purchasers hereby agree upon receipt of such notice from the
Issuer and the Company to suspend use of the Offering Memorandum until the
Issuer and the Company have amended or supplemented the Offering Memorandum to
correct such misstatement or omission or to effect such compliance.
(d) Notwithstanding any provision of paragraph (b) or (e) of this
Section 4 to the contrary, however, the Issuer's and the Company's obligations
under paragraphs (b) and (c) of this Section 4 and the Initial Purchasers'
obligations under paragraph (c) of this Section 4 shall terminate on the earlier
to occur of (i) the effective date of a shelf registration statement with
respect to the Securities filed pursuant to the Registration Rights Agreement
and (ii) the date upon which the Initial Purchasers and their affiliates cease
to hold Securities acquired as part of their initial distribution, but in any
event (in the case of this clause (ii)) not later than one year from the Closing
Time.
(e) Neither the Company, the Issuer nor any of their respective
affiliates (as defined in Rule 501(b) of Regulation D), nor any person acting on
behalf of the foregoing, will engage in any form of general solicitation or
general advertising (within the meaning of Regulation D) in connection with any
offer or sale of the Securities in the United States, or engage in any directed
selling efforts (as defined in Rule 902 of the Rules and Regulations) with
respect to the Securities prior to the effectiveness of a registration statement
with respect to the Securities, and each of them will comply with the offering
restrictions requirement of Regulation S with respect to the Securities. Terms
used in this clause (e) have the meanings ascribed to them by Regulation S. No
covenant is made hereby with respect to the conduct of the Initial Purchasers or
their affiliates (as such term is defined in Rule 501(b) of Regulation D).
(f) Neither the Company nor any of its affiliates (as defined in Rule
501(b) of Regulation D), including without limitation the Issuer, will,
directly or indirectly, make offers or sales of any security, or solicit offers
to buy any security, under circumstances that would require the registration of
the Securities under the Securities Act.
(g) So long as any of the Securities are "restricted securities"
within the meaning of Rule 144(a)(3) of the Rules and Regulations, the Company
will, during any period in which it is not subject to and in compliance with
Section 13 or 15(d) of the Exchange Act, provide to each holder of such
restricted securities and to each prospective purchaser (as designated by such
holder) of such restricted securities, upon the request of such holder or
prospective purchaser, any information required to be provided by Rule
144A(d)(4) of the Rules and Regulations. This covenant is intended to be for the
benefit of the holders, and the prospective purchasers designated by such
holders, from time to time of such restricted securities.
<PAGE>
15
(h) Each Preferred Security (and each Debenture distributed to
holders of Preferred Securities pursuant to the terms of the Trust Agreement)
will bear a legend (and with respect to the Debentures a similar legend)
substantially in the following form until such legend shall no longer be
necessary or advisable because the Preferred Securities (and the Debentures) are
no longer subject to the restrictions on transfer described herein:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY
PURCHASING THIS SECURITY AGREES FOR THE BENEFIT OF THE SERIES A ISSUER THAT THIS
SECURITY MAY NOT BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE
THIRD ANNIVERSARY OF THE LATER OF THE ISSUANCE HEREOF (OR ANY PREDECESSOR
SECURITY HERETO) AND THE LAST DATE ON WHICH THE SERIES A ISSUER OR ANY
AFFILIATE OF THE SERIES A ISSUER WAS THE OWNER HEREOF (OR ANY PREDECESSOR OF
THIS SECURITY) OR (Y) THEREAFTER, BY ANY HOLDER THAT WAS AN AFFILIATE OF THE
SERIES A ISSUER AT ANY TIME DURING THE THREE MONTHS PRECEDING THE DATE OF SUCH
TRANSFER, IN EITHER CASE OTHER THAN (1) TO THE SERIES A ISSUER OR ANY SUBSIDIARY
THEREOF, (2) SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE
144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER AS DEFINED IN RULE 144A,
PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR OTHER TRANSFER IS BEING
MADE IN RELIANCE ON RULE 144A (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR
ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY), (3) IN AN
"OFFSHORE TRANSACTION" (AS DEFINED IN REGULATION S) IN ACCORDANCE WITH
REGULATION S UNDER THE SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE
FOREIGN PURCHASER ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS
SECURITY), AND IF SUCH TRANSFER IS BEING EFFECTED BY CERTAIN FOREIGN PURCHASERS
SPECIFIED IN THE INDENTURE (AS DEFINED IN THIS SECURITY) PRIOR TO THE EXPIRATION
OF THE "40 DAY RESTRICTED PERIOD" (WITHIN THE MEANING OF RULE 903(C)(3) OF
REGULATION S UNDER THE SECURITIES ACT), A CERTIFICATE (WHICH MAY BE OBTAINED
FROM THE SERIES A ISSUER OR THE PROPERTY TRUSTEE)IS DELIVERED TO THE SERIES A
ISSUER AND THE PROPERTY TRUSTEE, (4) TO A PERSON THAT IS AN "ACCREDITED
INVESTOR" AS DEFINED IN RULE 501(A) UNDER THE SECURITIES ACT (AS INDICATED BY
THE BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE
OF THIS SECURITY) THAT IS ACQUIRING THE SECURITY FOR INVESTMENT PURPOSES AND NOT
FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, AND A CERTIFICATE IN THE
FORM SPECIFIED IN THE INDENTURE IS DELIVERED BY THE TRANSFEREE TO THE SERIES A
ISSUER AND THE PROPERTY TRUSTEE (PROVIDED THAT CERTAIN FOREIGN PURCHASERS
SPECIFIED IN THE INDENTURE MAY NOT TRANSFER THIS SECURITY PURSUANT TO THIS
CLAUSE (4) PRIOR TO THE EXPIRATION OF THE "40 DAY RESTRICTED PERIOD" (WITHIN
<PAGE>
16
THE MEANING OF RULE 903(C)(3) OF REGULATION S UNDER THE SECURITIES ACT), (5)
PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY
RULE 144 (IF APPLICABLE) UNDER THE SECURITIES ACT OR (6) PURSUANT TO AN
EFFECTIVE REGISTRATION UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH
ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. THE HOLDER, BY
PURCHASING THIS SECURITY, IS DEEMED TO REPRESENT THAT IT (X) IS NOT ITSELF, AND
IS NOT ACQUIRING THE SECURITY WITH ASSETS OF, (i) AN "EMPLOYEE BENEFIT PLAN"
(WITHIN THE MEANING OF SECTION 3(3) OF ERISA), A "PLAN" (WITHIN THE MEANING OF
SECTION 4975(E)(I) OF THE INTERNAL REVENUE CODE), OR AN ENTITY WHOSE UNDERLYING
ASSETS INCLUDE PLAN ASSETS BY REASON OF INVESTMENT IN THE ENTITY BY SUCH AN
"EMPLOYEE BENEFIT PLAN" OR "PLAN" AND THE APPLICATION OF THE PLAN ASSET
REGULATION OR (ii) A "GOVERNMENTAL PLAN" (WITHIN THE MEANING OF SECTION 3(32) OF
ERISA) OR (Y)(i) IS ITSELF, OR IS ACQUIRING THIS SECURITY WITH ASSETS OF, AN
"INVESTMENT FUND" (WITHIN THE MEANING OF PART V(b) OF THE U.S. DEPARTMENT OF
LABOR PTE 84-14) MANAGED BY A "QUALIFIED PROFESSIONAL ASSET MANAGER" (WITHIN THE
MEANING OF PART V(a) OF PTE 84-14) WHICH IS MADE OR PROPERLY AUTHORIZED THE
DECISION FOR SUCH FUND TO PURCHASE THE SECURITIES, UNDER CIRCUMSTANCES SUCH THAT
PTE 84-14 IS APPLICABLE TO THE PURCHASE AND HOLDING OF SUCH SECURITIES (ii) IS
AN INSURANCE COMPANY POOLED SEPARATE ACCOUNT PURCHASING SECURITIES PURSUANT TO
PART I OF THE U.S. DEPARTMENT OF LABOR PTE 90-1 OR A BANK COLLECTIVE INVESTMENT
FUND PURCHASING PURSUANT TO PART I OF THE U.S. DEPARTMENT OF LABOR PTE 91-38,
AND IN EITHER CASE, NO "PLAN" OR "EMPLOYEE BENEFIT PLAN" NOT PURCHASING PURSUANT
TO PTE 84-14 OWNS MORE THAN 10% OF THE ASSETS OF SUCH ACCOUNT OR COLLECTIVE FUND
(WHEN AGGREGATED WITH OTHER PLANS OF THE SAME EMPLOYER OR EMPLOYEE
ORGANIZATION), (iii) IS AN INSURANCE COMPANY USING THE ASSETS OF THE GENERAL
ASSET ACCOUNT OF THE INSURANCE COMPANY TO PURCHASE THE SECURITIES PURSUANT TO
PART I OF THE U.S. DEPARTMENT OF LABOR PTE 95-60, IN WHICH CASE THE RESERVES AND
LIABILITIES FOR THE GENERAL ACCOUNT CONTRACTS HELD BY OR ON BEHALF OF ANY PLAN,
TOGETHER WITH ANY OTHER PLANS MAINTAINED BY THE SAME EMPLOYER OR EMPLOYEE
ORGANIZATION, DO NOT EXCEED 10% OF THE TOTAL RESERVE AND LIABILITIES OF THE
INSURANCE COMPANY GENERAL ACCOUNT (EXCLUSIVE OF SEPARATE ACCOUNT LIABILITIES),
PLUS SURPLUS AS SET FORTH IN THE NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS
ANNUAL STATEMENT FILED WITH THE DATE OF DOMICILE OF THE INSURER OR (IV) IS A
PLAN ACQUIRING THE SERIES A PREFERRED SECURITY WITH ASSETS OVER WHICH AN
IN-HOUSE ASSET MANAGER (WITHIN THE MEANING OF PART IV(A) OF PTE 96-23) HAS
DISCRETIONARY AUTHORITY, UNDER CIRCUMSTANCES SUCH THAT PTE 96-23 IS APPLICABLE
TO THE PURCHASE AND HOLDING OF SUCH SECURITIES. THE HOLDER HEREOF FURTHER AGREES
FOR THE BENEFIT OF THE SERIES A ISSUER THAT IT WILL NOTIFY ANY PURCHASER HEREOF
OF THE RESALE
<PAGE>
17
RESTRICTIONS REFERRED TO ABOVE, AN ACCREDITED INVESTOR HOLDING THIS SECURITY
AGREES THAT IT WILL FURNISH TO THE SERIES A ISSUER AND THE PROPERTY TRUSTEE SUCH
CERTIFICATES, LEGAL OPINIONS AND OTHER INFORMATION AS THEY MAY REASONABLY
REQUIRE TO CONFIRM THAT ANY TRANSFER BY IT OF THIS SECURITY COMPLIES WITH THE
FOREGOING RESTRICTIONS. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY,
REPRESENTS AND AGREES FOR THE BENEFIT OF THE SERIES A ISSUER THAT IT IS (l) A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A 0R (2) A PERSON
THAT IS AN "ACCREDITED INVESTOR" AS DEFINED IN RULE 501(a) UNDER THE SECURITIES
ACT THAT IS HOLDING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR (3) NOT A U.S. PERSON AND
THAT IT IS OUTSIDE THE UNITED STATES WITHIN THE MEANING OF, OR AN ACCOUNT
SATISFYING THE REQUIREMENTS OF, PARAGRAPH (o) OF RULE 902 UNDER REGULATION S
UNDER THE SECURITIES ACT. THE SERIES A PREFERRED SECURITIES WILL BE ISSUED, AND
MAY BE TRANSFERRED, ONLY IN BLOCKS HAVING A LIQUIDATION AMOUNT OF NOT LESS THAN
$100,000. ANY TRANSFER, SALE OR OTHER DISPOSITION OF SERIES A PREFERRED
SECURITIES IN A BLOCK HAVING A LIQUIDATION AMOUNT OF LESS THAN $100,000 SHALL BE
DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER. ANY SUCH TRANSFEREE SHALL
BE DEEMED NOT TO BE THE HOLDER OF SUCH SERIES A PREFERRED SECURITIES FOR ANY
PURPOSE, INCLUDING BUT NOT LIMITED TO THE RECEIPT OF DISTRIBUTIONS ON SUCH
SERIES A PREFERRED SECURITIES, AND SUCH TRANSFEREE SHALL BE DEEMED TO HAVE NO
INTEREST WHATSOEVER IN SUCH SERIES A PREFERRED SECURITIES."
(i) The Company will, or will cause the Issuer to, arrange for the
registration and qualification of the Preferred Securities for offering and sale
under the applicable securities or "blue sky" laws of such states and other U.S.
jurisdictions as the Initial Purchasers may reasonably designate in connection
with the resale of Preferred Securities as contemplated by this Agreement and
the Offering Memorandum and will continue such qualifications in effect for as
long as may be reasonably required to complete the distribution of the
Preferred Securities; provided that the Company shall not be required to (i)
--------
qualify as a foreign corporation, (ii) consent to the service of process under
the laws of any such state (except service of process with respect to the
offering and sale of the Preferred Securities), (iii) subject itself to taxation
in any such jurisdiction of (iv) make any change to its certificate of
incorporation or by-laws in connection with such qualification. The Company
shall, or shall cause the Issuer to, promptly advise the Initial Purchasers of
the receipt by the Company or the Issuer, as the case may be, of any
notification with respect to the suspension of the qualification or exemption
from qualification of the Preferred Securities for offering or sale in any
jurisdiction or the institution of any proceeding for such purpose.
(j) The Issuer will use the proceeds received from the sale of the
Preferred Securities and the Company will use the proceeds received from the
issue and sale of the Debentures in the manner specified in the Offering
Memorandum under the caption "Use of Proceeds".
<PAGE>
18
(k) Neither the Issuer nor the Company shall, directly or indirectly,
for a period commencing on the date hereof and ending on the earlier of (1) the
completion of the distribution of the Preferred Securities (as notified by
Dillon, Read) and (2) 30th day after the Closing Time, except with the prior
written consent of Dillon, Read, offer to sell, pledge, sell, grant any option,
warrant or other right to purchase, or otherwise transfer or dispose of (or
agree to do any of the foregoing) (a) any trust certificates or other securities
of the Issuer, (b) any preferred stock or any other security of the Company that
is substantially similar to the Preferred Securities or (c) any other securities
which are convertible into, or exercisable or exchangeable for, any of the
securities described in (a) and (b) above. The foregoing sentence shall not
apply to (i) the issuance of the Common Securities to the Company by the Issuer,
(ii) the issuance of the Preferred Securities being sold hereunder and the sale
thereof pursuant hereto or (iii) the issuance of the Debentures to the Issuer by
the Company.
(l) The Company agrees that no future offer and sale of securities of
the Company of any class will be made if, as a result of the doctrine of
"integration" referred to in Rule 502 of Regulation D, such offer and sale could
reasonably have been expected, at the time of such sale, based upon public laws,
Commission releases and Commission no-action - letters, to render invalid the
exemption from the registration requirements of the Securities Act relied upon
in connection with the transactions contemplated by this Agreement.
(m) In connection with the original distribution of the Preferred
Securities, the Company agrees that, prior to any offer or resale of the
Preferred Securities by the Initial Purchasers, the Initial Purchasers and
counsel for the Initial Purchasers shall have the right to make, and promptly
receive from the Company adequate information with respect to, reasonable
inquiries into the business of the Company and its subsidiaries.
Section 5. Payment of Expenses. The Company will pay all costs and
-------------------
expenses incident to the performance of the obligations under this Agreement of
the Company and the Issuer, including (a) the preparation and printing of the
Preliminary Offering Memorandum and the Offering Memorandum (including financial
statements, exhibits and documents incorporated by referenced therein) and any
amendments or supplements thereto, and the cost of delivery thereto to the
Initial Purchasers, (b) the preparation, issuance, printing and distribution of
the Preferred Securities and any survey of state securities or "blue sky" laws
or legal investment memoranda ("Blue Sky Survey"), (c) the delivery of the
Preferred Securities to the Initial Purchasers, including any stock transfer
taxes payable upon the sale of the Preferred Securities to the Initial
Purchasers, (d) the fees and disbursements of the Company's and the Issuer's
counsel and accountants, (e) the qualification of the Preferred Securities under
the applicable state securities or "blue sky" laws in accordance with Section
4(i) hereof, including all filing fees and reasonable fees and disbursements of
counsel for the Initial Purchasers in connection therewith and in connection
with the Blue Sky Survey, (f) any filling fees in connection with any filing for
review of the offering with the NASD, (g) any fees charged by rating agencies
for rating the Preferred Securities, (h) the fees and expenses of the Indenture
Trustee, the Property Trustee, the Guarantee Trustee and the Delaware Trustee,
including the reasonable fees and disbursements of counsel for such trustees,
(i) all listing fees and reasonable expenses in connection with the application
for designation of the Preferred Securities as PORTAL-eligible securities and
(j) the cost of qualifying the Preferred
<PAGE>
19
Securities with The Depository Trust Company; provided, however, that it is
-------- -------
understood that the Company will not be responsible for payment of the Initial
Purchasers' legal counsel fees and expenses, except as provided in subsection
(e) above and under the circumstances set forth in the last paragraph of this
section, and shall not be responsible for the travel and lodging expenses
related to the road show, except that the Company will pay the travel and
lodging expenses of its own employees.
If the sale of the Preferred Securities provided for herein is not
consummated because this Agreement is terminated pursuant to Section 8 hereof or
because any condition to the obligations of the Initial Purchasers set forth in
Section 6 hereof is not satisfied, other than by reason of a default by the
Initial Purchasers in payment for the Preferred Securities at the Closing Time,
the Company shall reimburse the Initial Purchasers promptly upon demand for all
reasonable out-of-pocket expenses (including reasonable fees and disbursements
of counsel to the Initial Purchasers) that shall have been incurred by them in
connection with the proposed purchase and sale of the Preferred Securities.
Section 6. Conditions of Initial Purchasers' Obligation. The
--------------------------------------------
obligations of the several Initial Purchasers to purchase and pay for the
Preferred Securities that they have respectively agreed to purchase pursuant to
this Agreement are subject to the following conditions:
(a) The Company shall furnish to the Initial Purchasers at the
Closing Time an opinion of Sullivan & Cromwell, special counsel for the
Company, addressed to each of the Initial Purchasers and dated the day of
the Closing Time and in form reasonably satisfactory to Simpson Thacher &
Bartlett, counsel for the Initial Purchasers, to the effect that:
(i) Each of this Agreement and the Registration Rights Agreement
has been duly authorized, executed and delivered by the Company.
(ii) Each of the Trust Agreement, the Guarantee Agreement and the
Expense Agreement has been duly authorized, executed and delivered by the
Company, and each of the Guarantee Agreement and the Expense Agreement
constitutes a legal, valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors'
rights and to general equity principles.
(iii) The Indenture has been duly authorized, executed and
delivered by the Company and, when duly authorized, executed and delivered
by the Indenture Trustee will constitute a legal, valid and binding
obligation of the Company, enforceable against the Company in accordance
with its terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity
principles.
<PAGE>
20
(iv) The Debentures have been duly authorized, executed, issued and
delivered by the Company and, when the Debentures have been duly
authenticated by the Indenture Trustee and paid for by the Issuer, will
constitute legal, valid and binding obligations of the Company, entitled to
the benefits of the Indenture and enforceable against the Company in
accordance with their terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general
equity principles.
(v) The statements set forth in the Offering Memorandum or any
amendment or supplement thereto under the captions "Description of the
Series A Preferred Securities", "Description of the Series A Subordinated
Debentures", "Description of the Series A Guarantee", "Relationship Among
the Series A Preferred Securities, the Series A Subordinated Debentures,
the Expense Agreement and the Series A Guarantee" and "ERISA
Considerations" insofar as they purport to describe the provisions of the
law and documents referred to therein are accurate, complete and fair.
(vi) Assuming the accuracy of the representations and warranties
and compliance with the agreements of the Initial Purchasers in Section 3
hereof, the offer, sale and delivery of the Preferred Securities to the
Initial Purchasers in the manner contemplated by this Agreement and the
Offering Memorandum and the initial resale of the Preferred Securities by
the Initial Purchasers in the manner contemplated in the Offering
Memorandum and this Agreement do not require registration under the
Securities Act, and, on or before the date hereof, none of the Indenture,
the Trust Agreement or the Guarantee Agreement is required to be qualified
under the Trust Indenture Act, it being understood that such counsel need
express no opinion as to any subsequent resale of any Preferred Securities.
(vii) Neither the Trust nor the Company is required to be registered
as an "investment company" under the 1940 Act.
(viii) The execution and delivery by the Company of, and the
performance by the Company under, this Agreement, the Trust Agreement, the
Indenture, the Guarantee, the Expense Agreement and the Registration Rights
Agreement, the consummation by the Company of the transactions contemplated
hereby and thereby, the filing of the certificate of trust of the Issuer
with the Secretary of State of the State of Delaware, compliance by the
Company with the terms of the foregoing and the application of the proceeds
from the sale of the Preferred Securities as contemplated by the Offering
Memorandum do not and will not (A) violate the charter or by-laws of the
Company or any Material Subsidiary or (B) violate any federal law of the
United States or law of the State of New York applicable to the Company or
its Material Subsidiaries or the General Corporation Law of the State of
Delaware; provided that, insofar as the performance by the Company of its
--------
obligations under the Indenture and the Debentures is concerned, such
counsel need express no opinion as to bankruptcy,
<PAGE>
21
insolvency, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights.
In addition, such counsel shall state that, as special counsel for the
Company, they reviewed the Offering Memorandum and the documents
incorporated or deemed incorporated by reference therein (the "Exchange Act
Documents"), participated in the preparation of the Offering Memorandum and
in discussions with the Initial Purchasers and representatives of the
Company and its independent public accountants and advised the Company as
to the requirements of the Securities Act and the applicable rules and
regulations thereunder. Such counsel shall also state that they reviewed
certificates of certain officers of the Company, the opinion of the
Company's General Counsel and the letter from the Company's independent
accountants. Such counsel shall state that nothing that came to their
attention that has caused them to believe that any part of the Offering
Memorandum (including the Exchange Act Documents) contained any untrue
statement of a material fact or omitted to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
Such counsel may also state that the limitations inherent in the
independent verification of factual matters are such, however that they do
not assume any responsibility for the accuracy, completeness or fairness of
the statements contained in the Offering Memorandum or any amendment or
supplement thereto, except for those made under the caption "Description of
the Series A Preferred Securities", Description of the Series A
Subordinated Debentures", "Description of the Series A Guarantee",
"Relationship Among the Series A Preferred Securities, the Series A
Subordinated Debentures, the Expense Agreement and the Series A Guarantee"
and "ERISA Considerations", and any comparable provisions in any amendment
or supplement to the Offering Memorandum insofar as they relate to
provisions of documents therein described. Also, such counsel may state
that they do not express any opinion or belief as to the financial
statement and schedules or other financial and statistical data contained
in the Offering Memorandum.
The foregoing opinion of such counsel may be limited to the federal
laws of the United States and the laws of the State of New York and of the
State of Delaware, and may state that such counsel express no opinion as to
the effect of the laws of any other jurisdiction.
Such counsel may rely as to certain matters on information obtained
from public officials, officers of the Company and other sources believed
by such counsel to be responsible, and shall assume that the Indenture has
been duly authorized, executed and delivered by the Trustee, that the
Trustee's certificates of authentication of the Debentures have been duly
manually signed by one of the Trustee's authorized officers, and that the
signatures on all documents examined by such counsel are genuine,
assumptions which they will not have independently verified.
<PAGE>
22
Such counsel may state that their opinion is delivered to the Initial
Purchasers by them as special counsel for the Company and is solely for the
Initial Purchasers' benefit.
(b) The Company shall furnish to the Initial Purchasers at the
Closing Time an opinion of Ms. Linda Madrid, Esq., Managing Director of
Legal Affairs for the Company, addressed to each of the Initial Purchasers
and dated the day of the Closing Time and in form reasonably satisfactory
to Simpson Thacher & Bartlett, counsel for the Initial Purchasers, to the
effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Delaware, with full corporate power and authority to own its properties and
conduct its business as described in the Offering Memorandum.
(ii) Riggs Bank N.A. is a national banking association duly
organized under the laws of the United States, holds a valid certificate of
authority from the OCC and is authorized to do business as a national
banking association under the laws of the United States, and has all
corporate power and authority to own its properties and conduct its
business as presently conducted, except where the failure to have such
corporate power and authority would not, individually or in the aggregate
with all other failures, have a Material Adverse Effect.
(iii) The Company and Riggs Bank N.A. are duly qualified or
licensed and in good standing as a foreign corporation in each jurisdiction
in which the ownership or leasing of its properties or character of its
operations makes such qualification necessary, except where failure to
obtain such qualification, license or good standing would not, individually
or in the aggregate with all other failures, have a Material Adverse
Effect.
(iv) All of the issued shares of capital stock of the Company
have been duly and validly authorized and issued, are fully paid and
non-assessable and were not issued in violation of the preemptive rights of
any other stockholder of the Company; and all of the issued and outstanding
shares of capital stock of each of the Company's Material Subsidiaries are
owned of record by the Company or one or more of its subsidiaries, and all
shares of such capital stock are duly and validly issued, fully paid and
non-assessable (except to the extent provided in 12 U.S.C (S) 55 or any
comparable provision of state law).
(v) The Company has an authorized capitalization as set forth
in the Offering Memorandum.
(vi) No approval, authorization, consent or order of or filing
with any federal or District of Columbia governmental or regulatory
commission, board, body, authority or agency is required in connection with
the offering, issuance or sale of the Guarantee and the Debentures by the
Company or is required for the valid
<PAGE>
23
authorization, execution, delivery and performance by the Company of the
Operative Documents or the consummation by the Company of the transactions
contemplated therein, other than (i) prior written notice to the Federal
Reserve, which notice has been duly given and (ii) such authorizations as
may be required by the securities or "blue sky" laws of the various states
in connection with the offer and sale of the Guarantee and the Debentures
or by the federal and state securities laws in connection with the
registration obligations under the Registration Rights Agreement.
(vii) The execution and delivery by the Company of, and the
performance by the Company under, this Agreement, the Trust Agreement, the
Indenture, the Debentures, the Guarantee, the Expense Agreement and the
Registration Rights Agreement, the consummation by the Company of the
transactions contemplated hereby and thereby, the filing of the certificate
of trust of the Issuer with the Secretary of State of the State of
Delaware, compliance by the Company with the terms of the foregoing and the
application of the proceeds from the sale of the Preferred Securities as
contemplated by the Offering Memorandum do not and will not (A) conflict
with, or result in any breach of, or constitute a default under (nor
constitute any event which with notice, lapse of time, or both would
constitute a breach of or default under), (1) any provision of any
Agreement or Instrument known to such counsel to which the Company or any
of its subsidiaries is a party or by which any of them or their respective
properties may be bound or affected, except any such breaches or defaults
as would not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect or (2) any federal or District of Columbia
law, regulation or rule or the General Corporation Law of the State of
Delaware or any decree, judgement or order of any federal or state
governmental authority known to such counsel applicable to the Company or
any of its Material Subsidiaries; (B) to the best of such counsel's
knowledge result in, or require the creation or imposition of, any material
lien upon or with respect to any of the properties now owned or hereafter
acquired by the Company or any of its Material Subsidiaries.
(viii) To the best of such counsel's knowledge, neither the Company
nor any of its Material Subsidiaries is in breach of, or in default under
(nor has any event occurred which with notice, lapse of time, or both would
constitute a breach of, or default under), (A) any Agreement or Instrument
to which the Company or any of its subsidiaries is a party or by which any
of them or their respective properties may be bound or affected or (B) any
law, regulation or rule or any decree, judgment or order applicable to the
Company or any of its subsidiaries, except any such breaches or defaults of
a type referred to in (A) or (B) above which would not reasonably be
expected to have, individually or in the aggregate, a Material Adverse
Effect or a material adverse effect on the ability of the Company to
consummate the transactions contemplated by this Agreement, the Trust
Agreement, the Indenture, the Debentures, the Guarantee, the Expense
Agreement and the Registration Rights Agreement.
(ix) To the best of such counsel's knowledge, there are no
actions, suits or proceedings pending or threatened against the Company or
any of its subsidiaries or any of their respective properties, at law or in
equity or before or by any court
<PAGE>
governmental authority or administrative authority which are likely to have a
Material Adverse Effect.
(x) The Company is duly registered as a bank holiday company under the
Bank Holiday Company Act of 1956, as amended; the deposit accounts of each of
the Company's domestic bank subsidiaries are insured by the Bank Holiday
Insurance Fund of the FDIC to the fullest extent permitted by law and the rules
and regulations of the FDIC, and no proceedings for the termination of such
insurance are pending or, to the best of such counsel's knowledge, threatened;
and neither the Company nor any of its Material Subsidiaries its party to or
otherwise the subject of any consent decree, memorandum of understanding, or
written agreement as defined in the Financial Institutions Reform, recovery and
Enforcement Act of 1989 (12 U.S.C. 1818 (e)(1)(A)(i)), nor to the best of such
councel's knowledge is the Company or any of its Material Subsidiaries a party
to any written agreement with the Bank of England.
In addition, such counsel shall state that, as Managing Director of Legal
Affairs of the Company, she reviewed the Offering Memorandum, participated in
the preparation of the Offering Memorandum and the Exchange Act Documents and in
discussions with the Initial Purchasers and representatives of the Company, its
outside counsel and its independent public accountants and advised the Company
as to the requirements of the Securities Act and the applicable rules and
regulations thereunder. Such counsel shall also state that the reviewed
certificates of certain officers of the Company and the letter from the
Company's independent accountants. Such counsel shall state that nothing that
came to her attention that has caused her to believe that any part of the
Offering Memorandum (including the Exchange Act Documents) contained any untrue
statement of a material fact or omitted to any state material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading.
Such counsel may also state that the limitations inherent in the
independent verification of factual matters are such, however, that she does
not assume any responsibility for the accuracy, completeness or fairness of the
statements contained in Offering Memorandum or any amendment or supplement
thereto, except for those made under the caption "The Corporation" in the
Offering Memorandum, and any comparable provisions in any amendment or
supplement to the Offering Memorandum insofar as they relate to provisions of
documents or legal matters therein described. Also, such counsel may state that
she does not express any opinion or belief as to the financial statements and
schedules or other financial and statistical data contained in the Offering
Memorandum.
Such counsel may rely as to certain matters on information obtained from
public officials, officers of the Company and other sources believed by such
counsel to be responsible, and all assume that the Indenture has been duly
authorized, executed and delivered by the Trustee, that the Trustee's
certificates of authentication of the Debentures have been duly manually signed
by one of the Trustee's authorized
<PAGE>
25
officers, and that the signatures on all documents examined by such counsel
are genuine, assumptions which he will not have independently verified.
The foregoing opinion of such counsel may be limited to the federal
laws of the United States, the laws of the District of Columbia and the
General Corporation Law of the State of Delaware, and may state that such
counsel expresses no opinion as to the effect of the laws of any other
jurisdiction.
Such counsel may state that his opinion is delivered to the Initial
Purchasers as Managing Director of Legal Affairs of the Company and is
solely for the Initial Purchasers' benefit.
Such opinion shall be to such further effect with respect to other
legal matters relating to this Agreement and the Securities as counsel for
the Initial Purchasers may reasonably request. In giving such opinion, such
counsel may rely, as to all matters governed by the laws of the State of
Delaware, on the opinion delivered pursuant to Section 6(f) hereto by
Richards, Layton & Finger, P.A. In addition, in giving such opinion, such
counsel may state that, insofar as such opinion involves factual matters,
they have relied, to the extent they deem proper, upon certificates of
officers of the Company and its subsidiaries, certificates of trustees of
the Issuer and certificates of public officials, provided that such
--------
certificates have been delivered to the Initial Purchasers.
(c) At the Closing Time, you shall have received a signed opinion of
Richards, Layton & Finger, P.A. counsel to the Delaware Trustee, dated as of the
Closing Time, addressed to each of the Initial Purchasers, in form and substance
reasonably satisfactory to Simpson Thacher & Bartlett, to the effect that:
(i) The Bank of New York (Delaware), a Delaware banking
corporation, has been duly incorporated and is validly existing in good
standing as a banking corporation under the laws of the State of Delaware
and has the corporate power to act as Trustee of a Delaware business trust
under the laws of the State of Delaware, 12 Del. (S) 3801 et seq.
---- -- ---
(d) At the Closing Time, you shall have received a signed opinion of
Emmet, Marvin & Martin LLP, counsel to The Bank of New York, dated as of the
Closing Time, addressed to each of the Initial Purchasers, in form and substance
reasonably satisfactory to Simpson Thacher & Bartlett, to the effect that:
(i) The Trustee is a banking corporation duly incorporated and
validly existing under the laws of the State of New York.
(ii) The execution, delivery and performance by The Bank of New
York, as property trustee (the "Property Trustee") of the Trust Agreement,
the execution, delivery and performance by The Bank of New York, as
Guarantee Trustee, of the Guarantee Agreement and the execution, delivery
and performance by The Bank of
<PAGE>
New York, as the Indenture Trustee, of the Indenture have been duly
authorized by all necessary corporate action on the part of the Property
Trustee, the Guarantee Trustee and the Indenture Trustee, respectively. The
Trust Agreement, the Guarantee Agreement and the Indenture have been duly
executed and delivered by the Property Trustee, the Guarantee Trustee and
the Indenture Trustee, respectively, and constitute the legal, valid and
binding obligations of the Property Trustee, the Guarantee Trustee and the
Indenture Trustee, respectively, enforceable against the Property Trustee,
the Guarantee Trustee and the Indenture Trustee, respectively, in
accordance with their terms, except as enforcement thereof may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation, receivership or similar laws relating to the enforcement of
creditors' rights generally, and by general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or a law).
(iii) The execution, delivery and performance of the Trust
Agreement, the Guarantee Agreement and the Indenture by the Property
Trustee, the Guarantee Trustee and the Indenture Trustee, respectively, do
not conflict with or constitute a breach of the applicable organizational
documents or by-laws of the Property Trustee, the Guarantee Trustee or the
Indenture Trustee, respectively, or the terms of any indenture or other
agreement or instrument known to such counsel and to which the Property
Trustee, the Guarantee Trustee or the Indenture Trustee, respectively, is a
party or is bound or any judgment, order or decree known to such counsel to
be applicable to the Property Trustee, the Guarantee Trustee or the
Indenture Trustee, respectively, of any court, regulatory body,
administrative agency, governmental body or arbitrator having jurisdiction
over the Property Trustee, the Guarantee Trustee or the Indenture Trustee,
respectively.
(iv) No consent, approval or authorization of, or registration
with or notice to, any federal or New York State banking authority is
required for the execution, delivery or performance by the Property
Trustee, the Guarantee Trustee or the Indenture Trustee of the Trust
Agreement, the Guarantee Agreement or the Indenture, respectively.
Such opinion shall be to such further effect with respect to other
legal matters relating to this Agreement and the Securities as counsel for the
Initial Purchasers may reasonably request. In giving such opinion such counsel
may rely, as to all matters governed by the laws of jurisdictions other than the
law of the State of Delaware, the law of the State of New York and the federal
law of the United States, upon the opinions of counsel satisfactory to counsel
for the Initial Purchasers. Such counsel may also state that, insofar as such
opinion involves factual matters, they have relied, to the extent they deem
proper, upon certificates of officers of the Company and its subsidiaries,
certificates of trustees of the Issuer and certificates of public officials;
provided that such certificates have been delivered to the Initial Purchasers.
- --------
(e) At the Closing Time, you shall have received a signed opinion of
Sullivan & Cromwell, special United States tax counsel to the Company and the
Issuer, dated as of the
<PAGE>
27
Closing Time, addressed to each of the Initial Purchasers, in form and substance
reasonably satisfactory to counsel for the Initial Purchasers, to the effect
that:
(i) Subject to the qualifications set forth therein, the
statements made in the Offering Memorandum under the caption "Certain
United States Federal Income Tax Consequences" fairly present in all
material respects the principal United States federal income tax
consequences of an investment in the Preferred Securities.
(f) At the Closing Time, you shall have received a signed option of
Richards, Layton & Finger, P.A., special counsel to the Initial Purchasers and
special counsel to the Issuer, dated as of the Closing Time, together with
signed or reproduced copies of such opinion for each of the other Initial
Purchasers, in form and substance reasonably satisfactory to counsel for the
Initial Purchasers, to the effect set forth below.
(i) The Issuer has been duly created and is validly existing in
good standing as a business trust under the Delaware Act, and all filings
required under the laws of the State of Delaware with respect to the
creation and valid existence of the Issuer as a business trust have been
made.
(ii) Under the Delaware Act and the Trust Agreement, the Issuer
has the trust power and authority to own its property and conduct its
business, all as described in the Offering Memorandum.
(iii) The Trust Agreement constitutes a valid and binding
obligation of the Company and the Trustees, and is enforceable against the
Company and the Trustees in accordance with its terms, subject, as to
enforcement, to the effect upon the Trust Agreement of (i) bankruptcy,
insolvency, moratorium, receivership, reorganization, liquidation,
fraudulent transfer and other similar laws relating to the rights and
remedies of creditors generally, (ii) principles of equity, including
applicable law relating to fiduciary duties (regardless of whether
considered and applied in a proceeding in equity or at law), and (iii) the
effect of applicable public policy on the enforceability of provisions
relating to indemnification or contribution.
(iv) Under the Delaware Act and the Trust Agreement, the Issuer
has the trust power and authority (i) to execute and deliver, and to
perform its obligations under, this Agreement and the Registration Rights
Agreement and (ii) to issue and perform its obligations under the Preferred
Securities and the Common Securities.
(v) Under the Delaware Act and Trust Agreement, the execution
and delivery by the Issuer of this Agreement and the Registration Rights
Agreement, and the performance by the Issuer of its obligations hereunder
and thereunder, have been duly authorized by all necessary trust action on
the part of the Issuer.
(vi) The Preferred Securities have been duly authorized by the
Trust Agreement and are duly and validly issued and, subject to the
qualifications set forth herein, fully paid and nonassessable undivided
beneficial interests in the assets of the
<PAGE>
28
Issuer and are entitled to the benefits of the Trust Agreement. The holders
of the Preferred Securities, as beneficial owners of the Trust, will be
entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware. Such counsel may note that the
holders of Preferred Securities may be obligated, pursuant to the Trust
Agreement, (i) to provide indemnity and/or security in connection with and
pay taxes or governmental charges arising from transfers or exchanges of
certificates for Preferred Securities and the issuance of replacement
certificates for Preferred Securities, and (ii) to provide security or
indemnity in connection with requests of or directions to the Property
Trustee to exercise its rights and powers under the Trust Agreement.
(vii) Under the Delaware Act and the Trust Agreement, the issuance
of the Preferred Securities is not subject to preemptive rights.
(viii) The issuance and sale by the Issuer of the Preferred
Securities, the execution, delivery and performance by the Issuer of this
Agreement and the Registration Rights Agreement, the consummation by the
Issuer of the transactions contemplated hereby and thereby and compliance
by the Issuer with its obligations hereunder and thereunder, and the
performance by the Company, as sponsor, of its obligations under the Trust
Agreement (A) do not violate (i) any of the provisions of the certificate
of trust of the Issuer or the Trust Agreement or (ii) any applicable
Delaware law or administrative regulation (except that such counsel need
express no opinion with respect to the securities laws of the State of
Delaware) and (B) do not require any consent, approval, license,
authorization or validation of, or filing or registration with, any
Delaware legislative, administrative or regulatory body under the laws or
administrative regulations of the State of Delaware (except that such
counsel need express no opinion with respect to the securities laws of the
state of Delaware).
(ix) Assuming that the Issuer derives no income from or in
connection with sources within the State of Delaware and has no assets,
activities (other than maintaining the Delaware Trustee and the filing of
documents with the Secretary of State of the State of Delaware) or
employees in the State of Delaware, the holders of the Preferred Securities
(other than those holders of Preferred Securities who reside or are
domiciled in the State of Delaware) will have no liability for income taxes
imposed by the State of Delaware solely as a result of their participation
in the Issuer, and the Issuer will not be liable for any income tax imposed
by the State of Delaware.
Such opinion shall be to such further effect with respect to other legal
matters relating to this Agreement and the Securities as counsel for the Initial
Purchasers may reasonably request. In giving such opinion, such counsel may
state that, insofar as such opinion involves factual matters, they have relied,
to the extent they deem proper, upon certificates of officers of the Company and
its subsidiaries, certificates of trustees of the Issuer and certificates of
public officials; provided that such certificates have been delivered to the
--------
Initial Purchasers.
<PAGE>
29
(g) At the Closing Time, you shall have received the favorable
opinion of Simpson Thacher & Bartlett, counsel for the Initial Purchasers, dated
as of the Closing Time, addressed to each of the Initial Purchasers, to the
effect that the opinions delivered pursuant to Sections 6(a), 6(b), 6(c), 6(d)
6(e) and 6(f) appear on their face to be appropriately responsive to the
requirements of this Agreement, and with respect to the Securities, this
Agreement and such other related matters as you may reasonably require. In
giving such opinion, such counsel may rely, as to all matters governed by the
laws of jurisdictions other than the law of the State of New York, the federal
law of the United States and the General Corporation Law of the State of
Delaware, upon the opinions of counsel satisfactory to you. Such counsel may
also state that they have relied, to the extent they deem proper, upon
certificates of officers of the Company and certificates of public officials.
(h) At the Closing Time, (i) the Offering Memorandum, as it may then
be amended or supplemented, shall not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein, in the light of the circumstances under which
they were made, not misleading, (ii) except as may be disclosed in the Offering
Memorandum, there shall not have been, since the respective dates as of which
information is given in the Offering Memorandum, any material adverse change in
the financial condition, properties, assets, business, results of operations or
prospects of the Company and its subsidiaries and the Issuer taken as a whole,
(iii) each of the Company and the Issuer shall have complied in all material
respects with all agreements and satisfied in all material respects all
conditions on its part to be performed or satisfied at or prior to the Closing
Time and (iv) the representations and warranties of the Company and the
Issuer set forth in Section 1(a) shall be accurate in all material respects as
though expressly made at and as of the Closing Time. At the Closing Time, you
shall have received a certificate of (x) the Chief Executive Officer or an
Executive Vice President of the Company and (y) the Vice President-Finance of
the Company, dated as of the Closing Time, to such effect. At the Closing Time,
you shall also have received a certificate signed by an Administrative Trustee,
dated as of the Closing Time, to such effect.
(i) At the time that this Agreement is executed by the Company, you
shall have received from Arthur Andersen a letter, dated such date, in form and
substance reasonably satisfactory to you confirming that they are independent
public accountants with respect to the Company within the meaning of the
Securities Act and the applicable published rules and regulations thereunder,
and otherwise satisfactory to you.
(j) At the Closing Time, you shall have received from Arthur Andersen
a letter, in form and substance reasonably satisfactory to you and dated as of
the Closing Time, to the effect that they reaffirm the statements made in the
letters furnished pursuant to Section 6(i) hereof, except that the specified
date referred to shall be a date not more than five days prior to the Closing
Time.
(k) At the Closing Time, counsel for the Initial Purchasers shall
have been furnished with all such documents, certificates and opinions as they
may reasonably request for the purpose of enabling them to pass upon the
issuance and sale of the Securities as contemplated in this Agreement and in
order to evidence the accuracy and completeness of
<PAGE>
30
any of representations, warranties or statements of the Company and the Issuer,
the performance of any of the covenants of the Company and the Issuer, or the
fulfillment of any of the conditions herein contained; and all proceedings by
the Company and the Issuer at or prior to the Closing Time in connection with
the authorization, issuance and the of the Securities as contemplated in this
Agreement shall be reasonably satisfactory in form and substance to you and to
counsel for the Initial Purchasers.
(l) At the Closing Time, the Issuer and the Company shall have
executed and delivered the Registration Rights Agreement, and the Registration
Rights Agreement shall be in full force and effect.
(m) At the Closing Time, there shall not be any pending or
threatened legal or governmental proceedings against the Company or the Issuer
with respect to any of the transactions contemplated in this Agreement.
(n) The Preferred Securities shall have been approved by the
NASD as being eligible for trading in the PORTAL market.
If any of the conditions specified in this Section 6 shall not
have been fulfilled when and as required by this Agreement, this Agreement may
be terminated by you on notice to the Company and the Issuer at any time at or
prior to the Closing Time, and such termination shall be without liability of
any party to any other party, except as provided in Section 5 hereof.
Notwithstanding any such termination, the provisions of Section 7 hereof shall
remain in effect. Dillon, Read may in its sole discretion waive on behalf of the
Initial Purchasers compliance with any conditions to the obligations of the
Initial Purchasers hereunder.
Section 7. Indemnification
---------------
(a) The Company and the Issuer, jointly and severally(solely from
the assets of the Issuer), agree to indemnify, defend and hold harmless each
Initial Purchaser, and any person who controls any Initial Purchaser within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act, from and
against any loss, expense, liability or claim (including the reasonable cost of
investigation) which, jointly or severally, any such Initial Purchaser or
controlling person may incur arising out of or is based upon any untrue
statement or alleged untrue statement of a material fact contained in any
Preliminary Offering Memorandum or in the Offering Memorandum (or any amendment
or supplement thereto or any Exchange Act Document) or, arises out of or is
based upon any omission or alleged omission to state a material fact necessary
to make the statements made in such Preliminary Offering Memorandum or in such
Offering Memorandum (or any amendment or supplement thereto or any Exchange Act
Document) not misleading, except insofar as any such loss, expense, liability or
claim arises out of or is based upon any untrue statement or alleged untrue
statement of a material fact contained in and in conformity with information
furnished in writing by or on behalf of any Initial Purchaser to the Company
expressly for use with reference to such Initial Purchaser in such Preliminary
Offering Memorandum or in such Offering Memorandum (or any
<PAGE>
31
amendment or supplement thereto) or arises out of or is based upon any omission
or alleged omission to state a material fact in connection with such information
necessary to make such information not misleading; provided further that the
-------- -------
foregoing indemnification with respect to any Preliminary Offering Memorandum
shall not inure to the benefit of any Initial Purchaser (or any person
controlling such Initial Purchaser) from whom the person asserting any such
losses, claims, damages or liabilities purchased any of the Preferred Securities
if a copy of the Offering Memorandum (as then amended or supplemented if the
Company shall have furnished any amendments or supplements thereto) was not sent
or given by or on behalf of such Initial Purchaser on the initial resale to such
person, if such is required by law, at or prior to the written confirmation of
the sale of such Preferred Securities to such person and if the Offering
Memorandum (as so amended or supplemented) would have cured the defect giving
rise to such loss, claim, damage or liability, unless such failure resulted from
non-compliance by the Company with Section 4(c). For purposes of the last
proviso to the immediately preceding sentence, the term "Offering Memorandum"
shall not be deemed to include the documents incorporated therein by reference,
and no Initial Purchaser shall be obligated to send or give any supplement or
amendment to any document incorporated by reference in any Preliminary Offering
Memorandum or the Offering Memorandum to any person.
If any action is brought against an Initial Purchaser or controlling person
in respect of which indemnity may be sought against the Company or the Issuer
pursuant to the foregoing paragraph, such Initial Purchaser shall promptly
notify the Company in writing of the institution of such action and the Company
shall assume the defense of such action, including the employment of counsel and
payment of expenses. Such Initial Purchaser or controlling person shall have the
right to employ its or their own counsel in any such case, but the fees and
expenses of such counsel shall be at the expense of such Initial Purchaser or
such controlling person unless the employment of such counsel shall have been
authorized in writing by the Company in connection with the defense of such
action or the Company shall not have employed counsel to have charge of the
defense of such action or such indemnified party or parties shall have
reasonably concluded that there may be defenses available to it or them which
are different from or additional to those available to the Company (in which
case the Company shall not have the right to direct the defense of such action
on behalf of the indemnified party or parties), in any of which events such fees
and expenses shall be borne by the Company and paid as incurred (it being
understood, however, that the Company shall not be liable for the expenses of
more than one separate counsel in any one action or series of related actions in
the same jurisdiction representing the indemnified parties who are parties to
such action). Anything in this paragraph to the contrary notwithstanding, the
Company shall not be liable for any settlement of any such claim or action
effected without its written consent.
(b) Each Initial Purchaser severally agrees to indemnify, defend and
hold harmless the Company and the Issuer, their respective directors and
officers and any person who controls the Company within the meaning of Section
15 of the Act or Section 20 of the Exchange Act from and against any loss,
expense, liability or claim (including the reasonable cost of investigation)
which, jointly or severally, the Company or any such person arises out of or is
based upon any untrue statement or alleged untrue statement of a material fact
<PAGE>
32
contained in and in conformity with information furnished in writing by or on
behalf of such Initial Purchaser to the Company expressly for use with reference
to such Initial Purchaser in the Offering Memorandum (or in the Offering
Memorandum as amended or supplemented), or arises out of or is based upon any
omission or alleged omission to state a material fact in connection with such
information necessary to make such information not misleading.
If any action is brought against the Company, the Issuer or any such
person in respect of which indemnity may be sought against any Initial Purchaser
pursuant to the foregoing paragraph, the Company, the Issuer or such person
shall promptly notify such Initial Purchaser in writing of the institution of
such action and such Initial Purchaser shall assume the defense of such action,
including the employment of counsel and payment of expenses. The Company, the
Issuer or such person shall have the right to employ its own counsel in any such
case, but the fees and expenses of such counsel shall be at the expense of the
Company, the Issuer or such person unless the employment of such counsel shall
have been authorized in writing by such Initial Purchaser in connection with the
defense of such action or such Initial Purchaser shall not have employed counsel
to have charge of the defense of such action or such indemnified party or
parties shall have reasonably concluded that there may be defenses available to
it or them which are different from or additional to those available to such
Initial Purchaser (in which case such Initial Purchaser shall not have the right
to direct the defense of such action on behalf of the indemnified party or
parties), in any of which events such fees and expenses shall be borne by such
Initial Purchaser and paid as incurred (it being understood, however, that such
Initial Purchaser shall not be liable for the expenses of more than one separate
counsel in any one action or series of related actions in the same jurisdiction
representing the indemnified parties who are parties to such action). Anything
in this paragraph to the contrary notwithstanding, no Initial Purchaser shall be
liable for any settlement of any such claim or action affected without the
written consent of such Initial Purchaser.
(c) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party under subsections (a) and (b) of this
Section 7 in respect of any losses, expenses, liabilities or claims referred to
therein, then each applicable indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, expenses, liabilities or claims
(i) in such proportion as is appropriate to reflect the relative benefits
received by the Company and the Issuer on the one hand and the Initial
Purchasers on the other hand from the offering of the Securities or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company and
the Issuer on the one hand and of the Initial Purchasers on the other in
connection with the statements or omissions which resulted in such losses,
expenses, liabilities or claims, as well as any other relevant equitable
considerations. The relative benefits received by the Company and the Issuer on
the one hand and the Initial Purchasers on the other shall be deemed to be in
the same proportion as the total proceeds from the offering of the Securities
(net of underwriting discounts and commissions but before deducting expenses)
received by the Company and the Issuer bear to the underwriting discounts and
commissions received by the Initial Purchasers. The relative fault of the
Company and the Issuer on the one hand and of the Initial Purchasers on the
<PAGE>
33
other shall be determined by reference to, among other things, whether the
untrue statement or alleged untrue statement of a material fact or omission or
alleged omission relates to information supplied by the Company, the Issuer or
by the Initial Purchasers and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The amount paid or payable by a party as a result of the losses, claims, damages
and liabilities referred to above shall be deemed to include any legal or other
fees or expenses reasonably incurred by such party in connection with
investigating or defending any claim or action.
(d) The Company, the Issuer and the Initial Purchasers agree that it
would not be just and equitable if contribution pursuant to this Section 7 were
determined by pro rata allocation (even if the Initial Purchasers were treated
as one entity for such purpose) or by any other method of allocation which does
not take account of the equitable considerations referred to in subsection (c)
above. Notwithstanding the provisions of this Section 7, no Initial Purchaser
shall be required to contribute any amount in excess of the amount by which the
total price at which the Securities distributed by it exceeds the amount of any
damages which such Initial Purchaser has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person quilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The Initial
Purchasers' obligations to contribute pursuant to this Section 7 are several in
proportion to their respective underwriting commitments and not joint.
(e) The indemnity and contribution agreements contained in this
Section 7, and the covenants, warranties and representations of the Company and
the Issuer contained in this Agreement, shall remain in full force and effect
regardless of any investigation made by or on behalf of any Initial Purchaser,
or any person who controls any Initial Purchaser within the meaning of Section
15 of the Act or Section 20 of the Exchange Act, or by or on behalf of the
Company, its directors and officers or any person who controls the Company
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act,
and shall survive any termination of this Agreement or the issuance and delivery
of the Securities. The Company and each Initial Purchaser agree promptly to
notify the others of the commencement of any litigation or proceeding against it
and, in the case of the Company, against any of the Company's officers and
directors, in connection with the issuance and sale of the Securities, or in
connection with the Offering Memorandum.
Section 8. Termination of Agreement. The obligations of the several
-----------------------
Initial Purchasers hereunder shall be subject to termination in the absolute
discretion of the Initial Purchasers if, at any time prior to the time of
purchase, trading in securities on the New York Stock Exchange shall have been
suspended or minimum prices shall have been established on the New York Stock
Exchange, or if a banking moratorium shall have been declared either by the
United States or New York State authorities, or if the United States shall have
declared war in accordance with its constitutional processes or there shall have
occurred any material outbreak or escalation of hostilities or other national or
international calamity or crisis of such magnitude in its effect on the
financial markets of the United States as, in the reasonable judgement of the
Initial Purchasers, to make it impracticable to market the Securities.
<PAGE>
34
If the Initial Purchaser elect to terminate this agreement as
provided in this Section 8, the Company shall be notified promptly in writing
delivered by facsimile or telegram.
If the sale to the Initial Purchasers of the Securities, as
contemplated by this Agreement, is not carried out by the Initial Purchasers for
any reason permitted under this Agreement or if such sale is not carried out
because the Company shall be unable to comply with any of the terms of this
Agreement, the Company shall not be under any obligation or liability hereunder
or thereunder (except to the extent provided in Sections 5 and 7 hereof), and
the Initial Purchasers shall be under no obligation or liability to the Company
under this Agreement (except to the extent provided in Section 7 hereof) or to
one another hereunder.
This Agreement may also terminate pursuant to the provisions of
Section 6 with the effect stated in such Section.
Section 9. Default by One or More of the Initial Purchasers. If
------------------------------------------------
one or more of the Initial Purchasers shall fail at the Closing Time to purchase
the Preferred Securities that it or they are obligated to purchase pursuant to
this Agreement (the "Defaulted Securities"), you shall have the right, within 24
hours thereafter, to make arrangements for one or more of the non-defaulting
Initial Purchasers, or any other initial purchasers, to purchase all, but not
less than all, of the Defaulted Securities in such amounts as may be agreed upon
and upon the terms set forth in this Agreement; if, however, you have not
completed such arrangements within such 24-hour period, then:
(a) if the number of Defaulted Securities does not exceed 10% of
the total number of Preferred Securities, the non-defaulting Initial Purchasers
shall be obligated to purchase the full amount thereof in the proportions that
their respective Initial Share underwriting obligation proportions bear to the
underwriting obligation proportions of all non-defaulting Initial Purchasers, or
(b) if the number of Defaulted Securities exceeds 10% of the
total number of Preferred Securities, this Agreement shall terminate without
liability on the part of any non-defaulting Initial Purchaser.
No action taken pursuant to this Section shall relieve any
defaulting Initial Purchaser from liability in respect of its default.
In the event of any such default that does not result in a
termination of this Agreement, either you or the Company shall have the right to
postpone the Closing Time for a period not exceeding seven days in order to
effect any required changes in the Offering Memorandum or in any other documents
or arrangements. As used herein, the term "Initial Purchaser" includes any
person substituted for an Initial Purchaser under this Section 9.
Section 10. Notices. All notices and other communications under
-------
the Agreement shall be in writing and shall be deemed to have been duly given,
upon receipt, if
<PAGE>
35
delivered, mailed or transmitted by any standard form of telecommunication.
Notices to you or the Initial Purchasers shall be directed to you at Dillon,
Read, 535 Madison Avenue New York, New York 10022 (telecopier no.: (212)
593-0164), attention of Aaron C. Hill, with a copy to Simpson Thacher &
Bartlett, 425 Lexington Avenue, New York, New York 10017 (telecopier no.: (212)
455-2502), attention of Lee Meyerson, Esq.; and notices to the Company shall be
directed to Riggs National Corporation, 800 17th Street, NW, Washington, D.C.,
20074 (telecopier no.: (202) 835-5346), attention of Linda A. Madrid, Senior
Vice President and Managing Director of Legal Affairs, with a copy to Sullivan &
Cromwell, 1701 Pennsylvania Avenue, Washington, D.C. (telecopier no.: (202) 293-
6330), attention: Robert H. Craft, Jr.
Section 11. Parties. This Agreement is made solely for the benefit of
-------
the several Initial Purchasers, the Company and the Issuer and, to the extent
expressed, any person who controls the Company, the Issuer or any of the Initial
Purchasers within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act, and the directors of the Company and the Issuer, their
officers, employees and trustees, and their respective executors,
administrators, successors and assigns and, subject to the provisions of
Section 9 hereof, no other person shall acquire or have any right under or by
virtue of this Agreement. The term "successors and assigns" shall not include
any purchaser, as such purchaser, from any of the several Initial Purchasers of
the Securities. All of the obligations of the Initial Purchasers hereunder are
several and not joint.
Section 12. Representation of Initial Purchasers. You will act for the
------------------------------------
several Initial Purchasers in connection with the transactions contemplated by
this Agreement, and any action under or in respect of this Agreement taken by
you as Representatives will be binding upon all the Initial Purchasers.
Section 13. Governing Law and Time. This Agreement shall be governed
----------------------
by the laws of the State of New York, without giving effect to the provisions
thereof relating to conflicts of law. Specified times of the day refer to New
York City time.
Section 14. Counterparts. This Agreement may be executed in one or
------------
more counterparts and when a counterpart has been executed by each party, all
such counterparts taken together shall constitute one and the same agreement.
<PAGE>
36
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us a counterpart hereof, whereupon this
instrument will become a binding agreement among the Company, the Issuer and the
several Initial Purchasers in accordance with its terms.
Very truly yours,
RIGGS CAPITAL
By Riggs National Corporation,
as Depositor
By ___________________________
Name:
Title:
RIGGS NATIONAL CORPORATION
By ___________________________
Name:
Title:
Confirmed and accepted as of
the date first above written:
DILLON, READ & CO. INC.
FRIEDMAN, BILLINGS, RAMSEY & CO., INC.
By Dillon, Read & Co. Inc.
By _________________________________________
Name:
Title:
By Friedman, Billings, Ramsey & Co., Inc.
By _________________________________________
Name:
Title:
<PAGE>
36
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us a counterpart hereof, whereupon this
instrument will become a binding agreement among the Company, the Issuer and the
several Initial Purchasers in accordance with its terms.
Very truly yours,
RIGGS CAPITAL
By Riggs National Corporation,
as Depositor
By ___________________________
Name:
Title:
RIGGS NATIONAL CORPORATION
By ___________________________
Name:
Title:
Confirmed and accepted as of
the date first above written:
DILLON, READ & CO. INC.
FRIEDMAN, BILLINGS, RAMSEY & CO., INC.
By Dillon, Read & Co. Inc.
By ________________________________________
Name:
Title:
By Friedman, Billings, Ramsey & Co., Inc.
By ________________________________________
Name:
Title:
<PAGE>
SCHEDULE A
<TABLE>
<CAPTION>
Liquidation
Name of Initial Purchaser Amount
- ------------------------- ------
<S> <C>
Dillon, Read & Co. Inc. $ 86,250,000
Friedman, Billings Ramsey & Co., Inc. 63,750,000
Total ................................................... 150,000,000
==============
=
</TABLE>
<PAGE>
SCHEDULE B
Material Subsidiaries
---------------------
Riggs Bank N.A.
Riggs AP Bank Limited
<PAGE>
PAGE 1
STATE OF DELAWARE
OFFICE OF THE SECRETARY OF STATE
_______________________________
I, EDWARD J. FREEL, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO HEREBY
CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY OF THE CERTIFICATE OF
INCORPORATION OF "RIGGS NATIONAL CORPORATION", FILED IN THIS OFFICE ON THE
TWENTY-SEVENTH DAY OF OCTOBER, A.D. 1980, AT 10 O'CLOCK A.M.
[SECRETARY OFFICE SEAL] /s/ Edward J. Freel
--------------------------------------
Edward J. Freel, Secretary of State
0901688 8100 AUTHENTICATION: 8232210
960362105 DATE: 12-11-96
<PAGE>
CERTIFICATE OF INCORPORATION
OF
RIGGS NATIONAL CORPORATION
FIRST: The name of the Corporation is:
RIGGS NATIONAL CORPORATION
SECOND: The address of its registered office in the State of Delaware is
No. 100 West Tenth Street, in the City of Wilmington, County of New Castle. The
name of its registered agent at such address is The Corporation Trust Company.
THIRD: The nature of the business or purposes to be conducted or
promoted by the Corporation is:
(a) To act as a holding company and to acquire and own shares and other
interests in, and securities of, other corporations, associations, partnerships
or individuals; and as such shareholder or as owner of such other interests and
securities, to exercise all rights incident thereto.
(b) To acquire by purchase, subscription, contract or otherwise, and to
receive, hold, own, guarantee, sell, assign, exchange, transfer, mortgage,
pledge or otherwise dispose of or deal in and with any of the shares of the
capital stock, or any voting trust certificates in respect of the shares of the
capital stock, scrip, warrants, rights, bonds, debentures, notes, trust
receipts, and other securities, obligations, choses in action and evidences of
indebtedness or interest issued or created by any corporations, joint stock
companies, syndicates, associations, firms, trusts or persons, public or
private, or by the government of the United States of America, or by any foreign
government of the United States of America, or by any foreign government, or by
any state, territory, province, municipality or other political subdivision or
by any governmental agency, and as owner thereof to possess and exercise all the
<PAGE>
rights, powers and privileges of ownership, including the right to execute
consents and vote thereon, and to do any and all acts and things to execute
consents and vote thereon, and to do any and all acts necessary or advisable for
the preservation, protection, improvement and enhancement in value thereof.
(c) To acquire, and pay for in cash, stock or bonds of this Corporation or
otherwise, the good will, rights, assets and property, and to undertake or
assume the whole or any part of the obligations or liabilities of any person,
firm, association or corporation.
(d) To borrow or raise monies for any of the purposes of the Corporation
and, from time to time without limit as to amount, to draw, make, accept,
endorse, execute and issue promissory notes, drafts, bills of exchange,
warrants, bonds, debentures and other negotiable or non-negotiable instruments
and evidences of indebtedness, and to secure the payment of any thereof and of
the interest thereon by mortgage upon or pledge, conveyance or assignment in
trust of the whole or any part of the property of the Corporation, whether at
the time owned or thereafter acquired, and to sell, pledge or otherwise dispose
of such bonds or other obligations of the Corporation for its corporate
purposes.
(e) To purchase, receive, lease, or otherwise acquire, own, hold, improve,
employ, use and otherwise deal in and with real or personal property, or any
interest therein, wherever situated, and to sell, convey, lease, exchange,
transfer or otherwise dispose of, or mortgage or pledge, all or any of the
Corporation's property and assets, or any interest therein, wherever situated.
(f) To engage in any lawful act or activity for which Corporations may be
organized under the General Corporation Law of Delaware.
<PAGE>
(g) In general, to possess and exercise all the powers and privileges
granted by the General Corporation Law of Delaware or by any other law of
Delaware or by this Certificate of Incorporation together with any powers
incidental thereto, so far as such powers and privileges are necessary or
convenient to the conduct, promotion or attainment of the business or purposes
of the Corporation.
Fourth: The total number of shares of stock which the Corporation shall
have authority to issue is Five Million (5,000,000) shares of Common Stock, of
the par value of Five Dollars ($5.00) each, amounting in the aggregate to
Twenty-five Million Dollars ($25,000,000).
FIFTH: The name and mailing address of each incorporator is as follows:
NAME MAILING ADDRESS
---- ---------------
F.Elwood Davis 800 17th Street, N.W.
Washington, D. C. 20006
Fred M.Vinson, Jr. 800 17th Street, N.W.
Washington, D. C. 20006
John E. Boice, Jr. 800 17th Street, N.W.
Washington, D. C. 20006
SIXTH: The number of directors of the Corporation shall be fixed by, or
in the manner provided in, the By-laws and may be increased or decreased from
time to time as therein provided, but the number thereof shall not be less than
five.
SEVENTH: The powers of the incorporators shall terminate upon the filing
of this Certificate of Incorporation, and the names and mailing addresses of
the persons to serve as initial directors until the first annual meeting of
stockholders or until their successors are elected and qualify are:
Names of Directors Mailing Addresses
------------------ -----------------
Vincent C. Burke, Jr. 1503 Pennsyslvania Avenue, N.W.
Washington, D. C. 20074
Daniel J. Callahan. III 1503 Pennsyslvania Avenue, N.W.
<PAGE>
Francis J. Lyons 1503 Pennsylvania Avenue, N.W.
Washington, D.C. 20074
James D. M. McComas 1503 Pennsylvania Avenue, N.W.
Washington, D.C. 20074
William G. Tull 1503 Pennsylvania Avenue, N.W.
Washington, D.C. 20074
George O. Vass, Jr. 1503 Pennsylvania Avenue, N.W.
Washington, D.C. 20074
EIGHTH: The following provisions are adopted for the management of
the business and for the conduct of the affairs of the Corporation, and for
creating, defining, limiting and regulating the powers of the Corporation, the
directors, and the stockholders:
(a) The private property of the stockholders shall not be
subject to the payment of corporate debts to any extent whatever.
(b) The directors shall have power to adopt By-laws, and, from
time to time, to amend or repeal any By-law.
(c) The Directors may from time to time declare such dividends
as they shall deem advisable and proper, subject to such restrictions as may be
imposed by law, and pay the same to the stockholders at such times as they shall
fix.
(d) The Board of Directors shall have power to issue bonds,
debentures, or other obligations, either nonconvertible or convertible into the
Corporation's stock, upon such terms, in such manner and under such conditions
in conformity with law, as may be fixed by the Board of Directors prior to the
issue of such bonds, debentures or other obligations.
(e) The stockholders and directors shall have power to hold
their meetings and keep the books, documents and papers of the Corporation
outside of the state of Delaware, at
<PAGE>
such places as may be from time to time designated by the By-laws or by
resolution of the stockholders or directors, except as otherwise required by the
laws of Delaware.
(f) It is the intention that the objects, purposes and powers
specified in Article THIRD hereof shall, except where otherwise specified in
said Article, be nowise limited or restricted by reference to or inference from
the terms of any other article or paragraph in this Certificate of
Incorporation, but that the objects, purposes and powers specified in Article
THIRD and in each of the clauses or paragraphs of this charter shall be regarded
as independent objects, purposes and powers.
NINTH: No holder of any class of stock of the Corporation, whether now or
hereafter authorized, shall have any preemptive right, as such holder, to
purchase or subscribe for any stock of any class of the Corporation, whether now
or hereafter authorized, or to purchase or subscribe for any security or
obligation convertible into or exchangeable for or evidencing the right to
purchase stock of any class, which the Corporation may at times issue, but all
stock of any class and all securities or obligations of the Corporation whether
or not convertible, exchangeable or evidencing the right to purchase as
aforesaid, may be issued and disposed of by the Board of Directors on such terms
and for such consideration, so far as may be permitted by law, and to such
person or persons, as the Board of Directors in its absolute discretion may deem
advisable.
TENTH: At all meetings of stockholders held for the election of directors
or for any other corporate purpose, each holder of capital stock of the
Corporation, whether now or hereafter authorized; shall be entitled to one vote,
in person or by proxy, for each share of stock held by him. Cumulative
<PAGE>
voting for the election of directors shall not be permitted. Shares of its own
capital stock belonging to the Corporation or belonging to another corporation,
a majority of the voting stock of which is held directly or indirectly by the
Corporation, shall neither be entitled to vote nor be counted for quorum
purposes. Nothing in this Article TENTH shall be construed as limiting the right
of any corporation to vote stock, including but not limited to its own stock,
held by it in a fiduciary capacity.
ELEVENTH: The Corporation shall indemnify its officers, directors,
employees, and agents and former officers, directors, employees and agents, and
any person serving at the request of the Corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise, against expenses (including attorney's fees), judgments,
fines, and amounts paid in settlement in connection with any pending or
threatened action, suit or proceeding, whether civil, criminal, administrative
or investigative, with respect to which such officer, director, employee, agent
or other person is a party, or is threatened to be made a party, to the full
extent authorized or permitted by the General Corporation Law of the State of
Delaware. The indemnification provided herein shall not be deemed exclusive of
any other rights to which any person seeking indemnification may be entitled
under any By-Law, agreement, vote of stockholders or disinterested directors or
otherwise, both as to action in his official capacity and as to action in
another capacity, while holding any such office, and shall inure to the benefit
of the heirs, executors and administrators of any such person. The Corporation
shall have the power to purchaser and maintain
<PAGE>
insurance on behalf of any persons enumerated above against any liability
asserted against him and incurred by him in any such capacity, or arising out of
his status as such, whether or not the Corporation would have the power to
indemnify him against such liability under the provisions of the Article
ELEVENTH.
TWELFTH: The Corporation reserves the right to amend, alter, change or
repeal any provision contained in this Certificate of Incorporation, in the
manner now or hereafter prescribed by statue, and all rights conferred upon
stockholders herein are granted subject to this reservation.
THIRTEENTH: The Corporation is to have perpetual existence.
We, the undersigned, being all of the incorporators hereinbefore named, for
the purpose of forming a corporation under the laws of the State of Delaware, do
make, file and record this Certificate, and do certify that the facts herein
stated are true; and we have accordingly hereunto set our respective hands and
seals.
Date at Washington, D.C.
October 23, 1980
/s/ F. Elwood Davis(SEAL)
----------------------------
F. Elwood Davis
/s/ Fred M. Vinson(SEAL)
----------------------------
Fred M. Vinson, Jr.
/s/ John E. Boice, Jr.(SEAL)
----------------------------
John E. Boice, Jr.
<PAGE>
DISTRICT OF COLUMBIA) SS:
Be it remembered, That on this 23rd day of October personally appeared
---- -------
before me, HARRIET MORGAN, a Notary Public, F. ELWOOD DAVIS, FRED M. VINSON,
JR., and JOHN E. BOICE, JR., parties to the foregoing Certificate of
Incorporation, known to me personally to be such, and I having first made known
to them and each of them the contents of said certificate, they did each
severally acknowledge that they signed, sealed and delivered the same as their
voluntary act and deed, and each deposed that the facts therein stated were
truly set forth.
Given under my hand and seal of office the day and year aforesaid.
/s/ Harriet Morgan
--------------------------
Notary Public,
My Commission Expires November 30, 1982
<PAGE>
================================================================================
RIGGS NATIONAL CORPORATION
BY-LAWS
As Adopted January 7, 1981
With Amendments through April 10, 1996
================================================================================
<PAGE>
- --------------------------------------------------------------------------------
BY-LAWS OF
RIGGS NATIONAL CORPORATION
As Adopted January 7, 1981
(With Amendments through April 10, 1996)
TABLE OF CONTENTS
<TABLE>
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<S> <C>
Article I--OFFICES
Section 1.1 Registered Office............................ 1
Section 1.2 Other Offices................................ 1
Article II--THE STOCKHOLDERS
Section 2.1 Place of Meetings............................ 2
Section 2.2 Annual Meetings.............................. 2
Section 2.3 Special Meetings............................. 2
Section 2.4 Notice of Meetings........................... 2
Section 2.5 Voting Lists................................. 3
Section 2.6 Quorum....................................... 3
Section 2.7 Manner of Acting............................. 3
Section 2.8 Voting....................................... 4
Section 2.9 Inspectors of Election....................... 4
Article III--THE DIRECTORS
Section 3.1 General Powers............................... 5
Section 3.2 Number, Tenure and Qualifications............ 5
Section 3.3 Resignation, Filling Vacancies............... 6
Section 3.4 Place of Meetings............................ 6
Section 3.5 Annual Meeting............................... 6
Section 3.6 Notice of Meetings........................... 6
Section 3.7 Quorum....................................... 7
Section 3.8 Action Without a Meeting..................... 7
Section 3.9 Conference Call Meetings..................... 7
Section 3.10 Compensation of Directors.................... 7
Section 3.11 Removal of Directors......................... 8
Section 3.12 Committees of the Board...................... 8
</TABLE>
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<TABLE>
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Page
<S> <C>
Article IV--THE EXECUTIVE COMMITTEE
Section 4.1 Appointment, Tenure and Quorum.............. 9
Section 4.2 Powers of the Executive Committee........... 9
Section 4.3 Place and Time of Meetings.................. 9
Section 4.4 Minutes of Proceedings...................... 10
Article V--THE OFFICERS
Section 5.1 Number and Qualifications................... 11
Section 5.2 Term of Office.............................. 11
Section 5.3 Compensation................................ 11
Section 5.4 The Chairman of the Board................... 12
Section 5.5 The Senior Chairman and Vice Chairman....... 12
Section 5.6 The President............................... 12
Section 5.7 Executive Vice-Presidents................... 12
Section 5.8 Vice-Presidents............................. 12
Section 5.9 The Treasurer............................... 13
Section 5.10 Assistant Treasurer......................... 13
Section 5.11 The Secretary............................... 13
Section 5.12 Assistant Secretary......................... 14
Section 5.13 The Comptroller............................. 14
Section 5.14 Assistant Comptroller....................... 14
Article VI--NOTICES
Section 6.1 Manner of Giving............................ 15
Section 6.2 Waiver of Notice............................ 15
Article VII--CERTIFICATES OF STOCK
Section 7.1 Stock Certificates.......................... 16
Section 7.2 Facsimile Signatures........................ 16
Section 7.3 Designations, Preferences,
Participating and Optional Rights...... 16
Section 7.4 Lost Certificates........................... 17
Section 7.5 Transfer of Stock........................... 17
Section 7.6 Registered Stockholders..................... 17
Article VIII--FIXING RECORD DATE
Section 8.1 Record Date................................. 18
Article IX--INSPECTION OF BOOKS AND RECORDS
Section 9.1 Right and Conditions of Inspection.......... 19
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ii
<TABLE>
<CAPTION>
Page
<S> <C>
Article X--CONTRACTS, LOANS, CHECKS AND DEPOSITS
Section 10.1 Contracts............................................ 20
Section 10.2 Loans................................................ 20
Section 10.3 Checks, Drafts, etc.................................. 20
Section 10.4 Deposits............................................. 20
Section 10.5 Voting Stock and Other Corporations.................. 20
Article XI--FISCAL YEAR
Section 11.1 Fiscal Year.......................................... 21
Article XII--SEAL
Section 12.1 Seal................................................. 21
Article XIII--AMENDMENTS
Section 13.1 Amendments........................................... 21
Article XIV--ADVANCEMENT OF EXPENSES
SECTION 14.1 Advancement of Expenses.............................. 22
</TABLE>
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<PAGE>
iii
RIGGS NATIONAL CORPORATION
*****
B Y-L A W S
Adopted January 7, 1981
(With Amendments through April 10, 1996)
ARTICLE I
OFFICES
Section 1.1 Registered Office. The registered office of the Corporation
-----------------
shall be in the City of Wilmington, County of New Castle, State of Delaware.
Section 1.2 Other Offices. The Corporation may also have offices at such
-------------
other places both within and without the State of Delaware as the Board of
Directors may from time to time determine or the business of the Corporation may
require.
<PAGE>
ARTICLE II
THE STOCKHOLDERS
Section 2.1 Place of Meetings. All meetings of the stockholders of the
-----------------
Corporation for the election of directors or for any other purpose shall be held
in the City of Washington, District of Columbia, at such place as may be fixed
from time to time by the Board of Directors, or at such other place either
within or without the State of Delaware as shall be designated from time to time
by the Board of Directors and stated in the notice of the meeting.
Section 2.2 Annual Meeting. The Annual Meeting of the stockholders shall be
--------------
held on the first business day in May of each year at 9:30 a.m., or at such
other date and time before the 30th day thereafter as shall be designated from
time to time by the Board of Directors and stated in the notice of the meeting,
for the election of directors and for the transaction of such other business as
may properly come before the meeting.
Section 2.3 Special Meetings. Special meetings of the stockholders, may be
----------------
called at any time by the Board of Directors, or the Chairman of the Board, and
shall be called upon the request in writing of the holders of at least one-fifth
of the shares of capital stock of the Corporation issued and outstanding and
entitled to vote. Such request shall state the purpose or purposes of the
proposed meeting. Business transacted at any special meeting of stockholders
shall be limited to the purposes stated in the notice.
Section 2.4 Notice of Meetings. Written or printed notice stating the
------------------
place, date and hour of the meeting, and in the case of a special meeting, the
purpose or purposes for which the meeting is called, shall be given to each
stockholder of record entitled to vote at such meeting not less than ten or more
than sixty days before the date of the meeting.
<PAGE>
Section 2.5 Voting Lists. The officer who has charge of the stock ledger
------------
of the Corporation shall prepare and make, at least ten days before every
meeting of stockholders, a complete list of the stockholders entitled to vote at
the meeting, arranged in alphabetical order, and showing the address of each
stockholder and the number of shares registered in the name of each stockholder.
Such list shall be open to the examination of any stockholder, for any purpose
germane to the meeting, during ordinary business hours, for a period of at least
ten days prior to the meeting, either at a place within the city where the
meeting is to be held, which place shall be specified in the notice of the
meeting, or, if not so specified, at the place where the meeting is to be held.
The list shall also be produced and kept at the time and place of the meeting
during the whole time thereof, and may be inspected by any stockholder who
is present.
Section 2.6 Quorum. At all meetings of the stockholders the holders of a
------
majority of the stock issued and outstanding and entitled to vote thereat,
present in person or represented by proxy, shall constitute a quorum for the
transaction of business except as otherwise provided by statute or by the
Certificate of Incorporation. If, however, such quorum shall not be present or
represented at any meeting of the stockholders, the stockholders entitled to
vote thereat, present in person or represented by proxy, shall have power to
adjourn the meeting from time to time, without notice other than announcement at
the meeting, until a quorum shall be present or represented. At such adjourned
meeting at which a quorum shall be present or represent any business may be
transacted which might have been transacted at the meeting as originally
notified. If the adjournment is for more than thirty days, or if after the
adjournment a new record date is fixed for the adjourned meeting, a notice of
the adjourned meeting shall be given to each stockholder of record entitled to
vote at the meeting.
Section 2.7 Manner of Acting. When a quorum is present at any meeting,
----------------
the vote of the holders of a majority of the stock having voting power present
in person or represented by proxy shall decide any question properly brought
before such meeting, unless the question is one upon which by express provision
of the statutes or of the Certificate of
<PAGE>
Incorporation, a different vote is required in which case such express provision
shall govern and control the decision of such question.
Section 2.8 Voting. Unless otherwise provided in the Certificate of
------
Incorporation each stockholder shall at every meeting of the stockholders be
entitled to one vote for each share of the capital stock having voting power
held by such stockholder. All elections of directors shall be by written ballot,
unless otherwise provided in the Certificate of Incorporation. Cumulative voting
for the election of directors shall not be permitted. Each stockholder entitled
to vote may authorize another person or persons to act for him by proxy, but no
such proxy shall be voted or acted upon after three years from its date, unless
the proxy provides for a longer period.
Section 2.9 Inspectors of Election. The Board of Directors shall appoint
----------------------
three or more inspectors of election, and three or more alternates, to serve at
any meeting of the stockholders at which a vote is to be taken, the inspectors
of election shall examine proxies, pass upon their regularity, receive the votes
and act as tellers, and perform any other duties which the chairman may require
of them at said meeting.
<PAGE>
ARTICLE III
THE DIRECTORS
Section 3.1 General Powers. The business of the Corporation shall be
--------------
managed by or under the direction of its Board of Directors which may exercise
all such powers of the Corporation and do all such lawful acts and things as are
not by statute or by the Certificate of Incorporation or by these By-Laws
directed or required to be exercised or done by the stockholders.
Section 3.2 Number, Tenure and Qualifications. The number of directors
--------------------------------
which shall constitute the whole Board shall be not less than five nor more than
twenty-five. The initial Board shall consist of the six directors named in the
Certificate of Incorporation who shall serve until the first Annual Meeting of
the stockholders, unless earlier replaced. Thereafter, within the limits above
specified, the number of directors shall be fixed from time to time by
resolution of the Board of Directors. The directors shall be elected at the
Annual Meeting of the stockholders, except as provided in Section 3.3 of this
Article, and each director elected shall hold office until his successor is
elected and qualified or until his earlier resignation or removal. No reduction
in the number of directors shall have the effect of shortening the term of any
incumbent director, but any director affected thereby shall continue to hold
office until the next annual election. Each director shall, during the full term
of his directorship, own a minimum of $1,000 par value of stock of the
Corporation. No person shall be eligible to become a director after he has
attained age sixty-five; and, no person, who at the time he was first elected to
be a director was a principal officer or official of the organization with which
he is affiliated on a full-time basis, will be eligible to be re-elected after
he ceases to be a principal officer or official of such organization; provided,
however, that any person who was first elected or appointed to the Board at or
<PAGE>
prior to the April 15, 1987 meeting of stockholders shall be eligible to become
a director until he has attained the age of seventy-two; and provided further,
that the Chairman of the Board, at his discretion, may waive the foregoing age
or organization requirements. Notwithstanding the foregoing, there shall be no
age or organization requirements for the director serving as Chairman of the
Board.
Section 3.3 Resignation, Filling Vacancies. Any director may resign at any
------------------------------
time upon written notice to the Corporation. Vacancies and newly created
directorships resulting from any increase in the authorized number of directors
may be filled by a majority of the directors then in office, though less than a
quorum, and the directors so chosen shall hold office until the next annual
election and until their successors are duly elected and shall qualify, unless
sooner displaced. If there are no directors in office, then an election of
directors may be held in the manner provided by statute.
Section 3.4 Place of Meetings. The Board of Directors of the Corporation
-----------------
may hold meetings, both regular and special, either within or without the State
of Delaware.
Section 3.5 Annual Meeting. The first meeting of each newly elected Board
--------------
of Directors shall be held immediately following the Annual Meeting of the
stockholders, for the purpose of electing officers and transaction of other
business and no notice of such meeting shall be necessary to the newly elected
directors in order legally to constitute the meeting, provided a quorum shall be
present; or it may meet at such place and time as shall be fixed by the consent
in writing of all of the directors.
Section 3.6 Notice of Meetings. Regular meetings of the Board of Directors
------------------
may be held without notice at such time and at such place as shall from time to
time be determined by the Board. Special meetings of the Board may be called by
the Chairman of the Board, or by the President on two days' notice to each
director, either personally or by mail or by telegram; special meetings shall be
called by the Chairman of the Board or the Secretary in like manner and on like
notice on the written request of three directors.
<PAGE>
Section 3.7 Quorum. At all meetings of the Board a majority of the
------
directors shall constitute a quorum for the transaction of business and the act
of a majority of the directors present at any meeting at which there is a quorum
shall be the act of the Board of Directors, except as may be otherwise
specifically provided by statute or by the Certificate of Incorporation. If a
quorum shall not be present at any meeting of the Board of Directors, the
directors present thereat may adjourn the meeting from time to time, without
notice other than announcement at the meeting, until a quorum shall be present.
Section 3.8 Action Without a Meeting. Any action required or permitted to
------------------------
be taken at any meeting of the Board of Directors or of any committee thereof
may be taken without a meeting, if all members of the Board of committee, as the
case may be, consent thereto in writing, and the writing or writings are filed
with the minutes of proceedings of the Board or committee.
Section 3.9 Conference Call Meetings. Members of the Board of Directors,
------------------------
or any committee designated by the Board of Directors, may participate in a
meeting of the Board of Directors, or any committee, by means of conference
telephone or similar communications equipment by means of which all persons
participating in the meeting can hear each other, and such participation in a
meeting shall constitute presence in person at the meeting.
Section 3.10 Compensation of Directors. The Board of Directors shall have
-------------------------
the authority to fix the compensation of directors. The directors may be paid
their expenses, if any, of attendance at each meeting of the Board of Directors
and may be paid a fixed sum for attendance at each meeting of the Board of
Directors or a stated retainer or both as director. No such payment shall
preclude any director from serving the Corporation in any other capacity and
receiving compensation therefor. Members of special or standing committees may
be allowed like compensation for attending committee meetings.
<PAGE>
Section 3.11 Removal of Directors. Unless otherwise restricted by the
--------------------
Certificate of Incorporation or by law, any director or the entire Board of
Directors may be removed, with or without cause, by the holders of a majority of
shares entitled to vote at an election of directors.
Section 3.12 Committees of the Board. The Board of Directors may, by
-----------------------
resolution passed by a majority of the whole board, designate an Executive
Committee and one or more other committees and prescribe their powers and
authority. Each committee shall consist of one or more directors of the
Corporation as fixed by resolution of the Board. The Board may designate one or
more alternate members of any committee who may replace any absent or
disqualified member at any meeting of the committee.
<PAGE>
ARTICLE IV
THE EXECUTIVE COMMITTEE
Section 4.1 Appointment, Tenure and Quorum. The Board of Directors shall
------------------------------
appoint the Chairman of the Executive Committee who shall preside at all
meetings of the Committee. The Chairman of the Board of Directors shall, with
the advice, consent and approval of the Board, appoint the other members of the
Executive Committee. The Chairman of the Board, the Senior Chairman, if any, the
Vice Chairmen, if any, and the President shall be ex-officio members of the
Executive Committee. The members of the Executive Committee shall serve at the
pleasure of the Board of Directors. A majority of the members of the Executive
Committee shall constitute a quorum for the transaction of business.
Section 4.2 Powers of the Executive Committee. During the intervals between
---------------------------------
meetings of the Board of Directors, the Executive Committee shall have and may
exercise all the powers and authority of the Board of Directors in the
management of the business and affairs of the Corporation; except that the
Executive Committee shall not have the power or authority to amend the
Certificate of Incorporation, adopt an agreement of merger or consolidation,
recommend to the stockholders the sale, lease, or exchange of all or
substantially all of the Corporation's property and assets, recommend to the
stockholders a dissolution of the Corporation or a revocation of a dissolution,
or amend the By-Laws of the Corporation, or declare a dividend, or authorize the
issuance of stock, or take any other corporate action which under the General
Corporation Law of Delaware is specifically required to be taken by the Board of
Directors.
Section 4.3 Place and Time of Meetings. Meetings of the Executive Committee
--------------------------
may be held at the office of the Corporation, or elsewhere, and at such time as
they may appoint,
<PAGE>
but the Executive Committee shall at all times be subject to the call of the
Chairman of the Board or any two or more members of the committee.
Section 4.4 Minutes of Proceedings. The Executive Committee shall keep
----------------------
regular minutes of its proceedings and shall report the same to the Board of
Directors when requested.
<PAGE>
ARTICLE V
THE OFFICERS
Section 5.1 Number and Qualifications. The officers of the Corporation
-------------------------
shall consist of a Chairman of the Board, a President, one or more Executive
Vice-Presidents, one or more other Vice-Presidents, a Treasurer, a Secretary and
a Comptroller. The Corporation may also have a Senior Chairman of the Board, one
or more Vice Chairmen of the Board, and one or more Assistant Treasurers,
Assistant Secretaries and Assistant Comptrollers as determined by the Board of
Directors. None of the officers except the Chairman of the Board, the Senior
Chairman, if any, the Vice Chairmen, if any, and the President need be directors
of the Corporation. Any number of offices may be held by the same person
including that of Chairman of the Board and President.
Section 5.2 Term of Office. The officers of the Corporation shall be
--------------
elected annually at the first meeting of the Board of Directors after each
Annual Meeting of the stockholders and shall hold office until their respective
successors are chosen and qualify. Any officer elected or appointed by the Board
of Directors may be removed at any time, with or without cause, by the
affirmative vote of a majority of the Board. Such removal shall be without
prejudice to the contract rights, if any, of the officer so removed. Any vacancy
occurring among the officers shall be filled by the Board of Directors, but the
person so elected to fill the vacancy shall hold office only until the first
meeting of the Board of Directors after the next Annual Meeting of the
stockholders.
Section 5.3 Compensation. The compensation of the Chairman of the Board,
------------
the Senior Chairman, if any, the Vice Chairmen, if any, and the President shall
be fixed by the Board of Directors. The Board of Directors may delegate to the
Chairman of the Board, or the President the authority to fix the compensation of
the other officers and agents of the Corporation.
<PAGE>
Section 5.4 The Chairman of the Board. The Chairman of the Board shall be
-------------------------
the Chief Executive Officer of the Corporation. He shall preside at all meetings
of the stockholders and of the Board of Directors, and shall have, subject to
the supervision and direction of the Board of Directors and the Executive
Committee, general charge of the business, property and affairs of the
Corporation and may exercise the powers vested in him by the Board of Directors,
by law or these By-Laws, or which usually attach or pertain to such office.
Section 5.5 The Senior Chairman and Vice Chairmen. The Senior Chairman and
-------------------------------------
Vice Chairmen shall perform such duties as the Board of Directors, the Executive
Committee or the Chairman of the Board may prescribe. In the absence or
inability of the Chairman of the Board to act, the Senior Chairman or the Vice
Chairman designated by the Board shall preside at meetings of the stockholders
and of the Board of Directors.
Section 5.6 The President. The President shall be the Chief Administrative
-------------
Officer of the Corporation. He shall have, under the direction of the Chairman
of the Board, general supervision and care of the affairs of the Corporation
and, in general perform all acts incident to the office of President as
prescribed by law, by these By-Laws, or by the Board of Directors. In the
absence or inability of the Chairman of the Board, the Senior Chairman, or a
Vice Chairman to act, he shall preside at the meetings of the stockholders and
of the Board of Directors.
Section 5.7 Executive Vice Presidents. An Executive Vice-President shall
-------------------------
perform such duties as the Board of Directors, the Executive Committee, the
Chairman of the Board, or the President may prescribe, and in the absence or
disability of the President, the Executive Vice-President, or if there be more
than one Executive Vice-President, the Executive Vice-President designated by
the Board, shall perform the duties and exercise the powers of the President.
Section 5.8 Vice Presidents. A Vice-President shall perform such duties as
---------------
shall be assigned to him by the Board of Directors, the Executive Committee, the
Chairman of the
<PAGE>
Board, the President or by an Executive Vice-President.
Section 5.9 The Treasurer. The Treasurer shall have the custody of the
-------------
corporate funds and securities and shall keep full and accurate account of
receipts and disbursements in books belonging to the Corporation and shall
deposit all moneys and other valuables in the name and to the credit of the
Corporation in such depositories as may be designated by the Board of Directors.
He shall disburse the funds of the Corporation as may be ordered by the Board of
Directors, taking proper vouchers for such disbursements, and shall render to
the Board of Directors or the Executive Committee at regular meetings, or
whenever they may request it, an account of all his transactions as Treasurer
and of the financial condition of the Corporation. If required by the Board of
Directors, he shall give the Corporation a bond in such sum and with such surety
or sureties as shall be satisfactory to the Board of Directors for the faithful
performance of the duties of his office and for the restoration to the
Corporation, in case of his death, resignation, retirement or removal from
office, of all books, papers, vouchers, money and other property of whatever
kind in his possession or under his control belonging to the Corporation.
Section 5.10 Assistant Treasurer. An Assistant Treasurer shall perform
--------------------
such duties as may be assigned to him by the Board of Directors, the Executive
Committee, the Chairman of the Board, the President or the Treasurer. In the
absence or disability of the Treasurer, his duties may be performed by any
Assistant Treasurer.
Section 5.11 The Secretary. The Secretary shall attend all meetings of
-------------
the Board of Directors and of the stockholders, and shall record all votes and
the minutes of all proceedings in a book to be kept for that purpose, and shall
perform like duties for any standing committees when required. He shall give or
cause to be given notice of all meetings of the stockholders and of the Board of
Directors, and shall keep the seal of the Corporation in safe custody. He shall
perform such other duties as may be prescribed by the Board of Directors, or the
Executive Committee, or the Chairman of the Board under whose supervision he
shall be.
<PAGE>
Section 5.12 Assistant Secretary. An Assistant Secretary shall perform
-------------------
such duties as may be assigned to him by the Board of Directors, the Executive
Committee, the Chairman of the Board, the President or the Secretary. In the
absence or disability of the Secretary, his duties may be performed by any
Assistant Secretary.
Section 5.13 The Comptroller. The Comptroller shall be the chief
---------------
accounting officer of the Corporation, and shall have the general supervision
and control of all accounting matters, including the books of account of the
Corporation. He shall also perform such other duties and services as may from
time to time be prescribed by the Board of Directors, the Executive Committee,
the Chairman of the Board, the President, or an Executive Vice-President.
Section 5.14 Assistant Comptroller. An Assistant Comptroller shall
---------------------
perform such duties as may be assigned to him by the Board of Directors, the
Executive Committee, the Chairman of the Board, the President or the
Comptroller. In the absence or disability of the Comptroller, his duties may be
performed by any Assistant Comptroller.
<PAGE>
ARTICLE VI
NOTICES
Section 6.1 Manner of Giving. Whenever notice is required to be given to
----------------
any director or stockholder under the provisions of the General Corporation Law
of Delaware or under the Certificate of Incorporation or under these By-Laws, it
shall not be construed to mean personal notice, but such notice may be given in
writing, by mail, addressed to such director or stockholder, at his address as
it appears on the records of the Corporation, with postage thereon prepaid, and
such notice shall be deemed to be given at the time when the same shall be
deposited in the United States mail. Notice to directors may also be given by
telegram.
Section 6.2 Waiver of Notice. Whenever any notice is required to be given
----------------
under the General Corporation Law of Delaware or under the Certificate of
Incorporation or under these By-Laws, a waiver thereof in writing, signed by the
person or persons entitled to such notice, whether before or after the time
stated therein, shall be deemed equivalent to the giving of such notice.
<PAGE>
ARTICLE VII
CERTIFICATES OF STOCK
Section 7.1 Stock Certificates. Every holder of stock in the Corporation
------------------
shall be entitled to have a certificate, signed by, or in the name of the
Corporation by, the Chairman of the Board of Directors, or the President or a
Vice-President and the Treasurer or an Assistant Treasurer, or the Secretary or
an Assistant Secretary of the Corporation, certifying the number of shares owned
by him in the Corporation.
Section 7.2 Facsimile Signatures. Any of or all the signatures on the
--------------------
certificate may be facsimile. In case any officer, transfer agent or
registrar who has signed or whose facsimile signature has been placed upon a
certificate shall have ceased to be such officer, transfer agent or registrar
before such certificate is issued, it may be issued by the Corporation with the
same effect as if he were such officer, transfer agent or registrar at the date
of issue.
Section 7.3 Designations, Preferences, Participating and Optional Rights.
------------------------------------------------------------
If the Corporation shall be authorized to issue more than one class of stock or
more than one series of any class, the powers, designations, preferences and
relative, participating, optional or other special rights of each class of stock
or series thereof and the qualification, limitations or restrictions of such
preferences and/or rights shall be set forth in full or summarized on the face
or back of the certificate which the Corporation shall issue to represent such
class or series of stock, provided that, except as otherwise provided in
Section 202 of the General Corporation Law of Delaware, in lieu of the foregoing
requirements, there may be set forth on the face or back of the certificate
which the Corporation shall issue to represent such class or series of stock, a
statement that the Corporation will furnish without charge to each stockholder
who so requests the powers, designations, preferences and relative,
participating, optional or other special rights of each class of stock or series
thereof and the qualifications, limitations or restrictions of such preferences
and/or rights.
<PAGE>
Section 7.4 Lost Certificates. The Board of Directors may direct a new
-----------------
certificate of stock to be issued by the Corporation alleged to have been lost,
stolen or destroyed, upon the making of an affidavit of that fact by the person
claiming the certificate of stock to be lost, stolen or destroyed. The Board of
Directors may, in its discretion and as a condition precedent to the issuance of
a new certificate, require the owner of such lost, stolen or destroyed
certificate, or his legal representative, to give the Corporation a bond in such
sum as it may direct as indemnity against any claim that may be made against the
Corporation with respect to the certificate alleged to have been lost, stolen or
destroyed.
Section 7.5 Transfer of Stock. The shares of stock shall be transferable
-----------------
on the books of the Corporation by the registered owner or owners thereof or by
attorney, lawfully constituted in writing, and upon surrender of the certificate
therefor duly endorsed or accompanied by proper evidence of succession,
assignment or authority to transfer, the Corporation or its transfer agent
shall issue a new certificate to the person or persons entitled thereto.
Section 7.7 Registered Stockholders. The Corporation shall be entitled to
-----------------------
treat the registered holder of any share or shares of its stock as the actual
owner thereof and as such the person possessing the exclusive right to receive
dividends and to vote such stock, and shall not be bound to recognize any
equitable or other claim to or interest in such share or shares on the part of
any other person, whether or not it shall have express or other notice thereof,
except as otherwise provided by the laws of Delaware.
<PAGE>
ARTICLE VIII
FIXING RECORD DATE
Section 8.1 Record Date. The Board of Directors may fix, in advance, a
-----------
date, not more than sixty nor less than ten days before the date of any
stockholders meeting nor more than sixty days prior to any dividend payment date
or other date for the distribution or allotment of any rights, as a record date
for the determination of the stockholders entitled to notice of and to vote at
such meeting, or entitled to receive such dividends or rights, as the case may
be; and only stockholders of record on such date shall be entitled to notice of
and to vote at such meeting or to receive such dividends or rights. A
determination of stockholders of record entitled to notice of or to vote at a
meeting of stockholders shall apply to any adjournment of the meeting; provided,
however, that the Board of Directors may fix a new record date for the adjourned
meeting.
<PAGE>
ARTICLE IX
INSPECTION OF BOOKS AND RECORDS
Section 9.1 Right and Conditions of Inspection. Any stockholder of
----------------------------------
record, in person or by attorney or other agent, shall, upon written demand
under oath stating the purpose thereof, have the right during the usual hours
for business to inspect for any proper purpose the Corporation's stock ledger, a
list of its shareholders, and its other books and records, and to make copies or
extracts therefrom. A proper purpose shall mean a purpose reasonably related to
such person's interest as a stockholder. In every instance where an attorney or
other agent shall be the person who seeks the right to inspection, the demand
under oath shall be accompanied by a power of attorney or such other writing
which authorizes the attorney or other agent to so act on behalf of the
stockholder. The demand under oath shall be directed to the Corporation at its
registered office in the State of Delaware or at its principal place of
business.
<PAGE>
ARTICLE X
CONTRACTS, LOANS, CHECKS AND DEPOSITS
Section 10.1 Contracts. The Board of Directors may authorize any officer
---------
or officers, agent or agents, to enter into any contract or execute and deliver
any instrument in the name of and on behalf of the Corporation, and such
authority may be general or confined to specific instances.
Section 10.2 Loans. No loans shall be contracted on behalf of the
-----
Corporation and no evidences of indebtedness shall be issued in its name unless
authorized by resolution of the Board of Directors. Such authority may be
general or confined to specific instances.
Section 10.3 Checks, Drafts, etc. All checks, drafts or other orders for
--------------------
the payment of money, notes, or other evidences of indebtedness issued in the
name of the Corporation, shall be signed by such officer or officers, agent or
agents of the Corporation and in the manner as shall from time to time be
determined by resolution of the Board of Directors.
Section 10.4 Deposits. All funds of the Corporation shall be deposited in
--------
such banks, trust companies or other depositaries as the Board of Directors may
select.
Section 10.5 Voting Stock and Other Corporations. The Chairman of the
-----------------------------------
Board, the President or any Executive Vice-President may execute proxies on
behalf of the Corporation for the purpose of voting any shares of stock of any
other corporation owned by the Corporation.
<PAGE>
ARTICLE XI
FISCAL YEAR
Section 11.1 Fiscal Year. The fiscal year of the Corporation shall begin
-----------
on the first day of January in each year and end on the last day of December in
each year.
ARTICLE XII
SEAL
Section 12.1 Seal. The corporate seal shall have inscribed thereon the
----
name of the Corporation, the year of its organization and the words "Corporate
Seal, Delaware". The seal may be used by causing it or a facsimile thereof to be
impressed or affixed or reproduced or otherwise.
ARTICLE XIII
AMENDMENTS
Section 13.1 Amendments. These By-Laws may be altered, amended or
----------
repealed or new by-laws may be adopted by the Board of Directors at any regular
or special meeting of the Board provided notice of such alteration, amendment,
repeal or adoption of new by-laws be contained in the notice of such meeting.
Nothing herein shall be construed so as to divest or limit the power of the
stockholders to adopt, amend or repeal by-laws.
<PAGE>
ARTICLE XIV
ADVANCEMENT OF EXPENSES
Section 14.1 Advancement of Expenses. In connection with the provisions
-----------------------
of Article ELEVENTH of the Corporation's Certificate of Incorporation, the
Corporation shall pay or reimburse expenses incurred by any person entitled to
indemnification under such Article in defending any pending or threatened
action, suit or proceeding, whether civil, criminal, administrative or
investigative, with respect to which such person is a party or is threatened to
be made a party. Such payment or reimbursement shall be made promptly upon
receipt by the Corporation of an undertaking of such person to repay such
expenses if it shall ultimately be determined that such person is not entitled
to be indemnified by the Corporation.
<PAGE>
________________________________________________________________________________
RIGGS NATIONAL CORPORATION
TO
THE BANK OF NEW YORK
TRUSTEE
_______________________________
JUNIOR SUBORDINATED INDENTURE
DATED AS OF DECEMBER 13, 1996
_______________________________
________________________________________________________________________________
<PAGE>
JUNIOR SUBORDINATED INDENTURE, dated as of December 13, 1996, between RIGGS
NATIONAL CORPORATION, a Delaware corporation (hereinafter called the
"Corporation") having its principal office at 1503 Pennsylvania Avenue, N.W.,
Washington, D.C. 20005 and THE BANK OF NEW YORK, a New York banking corporation,
as Trustee (hereinafter called the "Trustee").
RECITALS OF THE CORPORATION
The Corporation has duly authorized the execution and delivery of this
Indenture to provide for the issuance of its 8 5/8% Junior Subordinated
Deferrable Interest Debentures, Series A, Due December 31, 2026 (hereinafter
called the "Securities") of substantially the tenor and amount hereinafter
provided, which are to be issued to evidence loans made to the Corporation of
the proceeds from the issuance by a business trust ("Riggs Capital") of
preferred trust interests in Riggs Capital (the "Preferred Securities") and
common interests in Riggs Capital (the "Common Securities" and, collectively
with the Preferred Securities, the "Trust Securities"), and to provide the terms
and conditions upon which the Securities are to be authenticated, issued and
delivered.
All things necessary to make the Securities, when executed by the Corporation
and authenticated and delivered hereunder and duly issued by the Corporation,
the valid obligations of the Corporation, and to make this Indenture a valid
agreement of the Corporation, in accordance with their and its terms, have been
done.
NOW THEREFORE, THIS INDENTURE WITNESSETH: For and in consideration of the
premises and the purchase of the Securities by the Holders thereof, it is
mutually covenanted and agreed, for the equal and proportionate benefit of all
Holders of the Securities, as follows:
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 1.1. Definitions.
For all purposes of this Indenture, except as otherwise expressly provided or
unless the context otherwise requires:
(1) The terms defined in this Article have the meanings assigned to them in
this Article, and include the plural as well as the singular;
(2) All other terms used herein which are defined in the Trust Indenture Act,
either directly or by reference therein, have the meanings assigned to them
therein;
<PAGE>
(3) All accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles,
and the term "generally accepted accounting principles" with respect to any
computation required or permitted hereunder shall mean such accounting
principles that are generally accepted at the date or time of such computation;
provided, that when two or more principles are so generally accepted, it shall
mean that set of principles consistent with those in use by the Corporation; and
(4) The words "herein," "hereof" and "hereunder" and other words of similar
import refer to this Indenture as a whole and not to any particular Article,
Section or other subdivision.
"Accredited Investor" means an accredited investor within the meaning of Rule
501(a) of Regulation D under the Securities Act.
"Act" when used with respect to any Holder has the meaning specified in
Section 1.4.
"Additional Interest" means the interest, if any, that shall accrue on any
interest on the Securities the payment of which has not been made on the
applicable Interest Payment Date and which shall accrue at the rate per annum
specified or determined as specified in such Security from the applicable
Interest Payment Date.
"Additional Sums" has the meaning specified in Section 10.6.
"Additional Taxes" means the sum of any additional taxes, duties and other
governmental charges to which Riggs Capital has become subject from time to time
as a result of a Tax Event.
"Adjusted Treasury Rate" means, with respect to any redemption date, the
Treasury Rate plus (i) 1.70% if such redemption date occurs on or before
December 31, 1997 or (ii) 0.95% if such redemption date occurs after December
31, 1997.
"Administrative Trustee" means, in respect of Riggs Capital, each Person
identified as an "Administrative Trustee" in the Trust Agreement, solely in such
Person's capacity as Administrative Trustee of Riggs Capital under the Trust
Agreement and not in such Person's individual capacity, or any successor
Administrative Trustee appointed as therein provided.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person; provided, however, that Riggs Capital shall
not be deemed to be an Affiliate of the Corporation. For the purposes of this
definition, "control" when used with respect to any specified Person means the
power to direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by contract or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"Agent Member" means any member of, or participant in, the Depository.
2
<PAGE>
"Applicable Procedures" means, with respect to any transfer or transaction
involving a Global Security or beneficial interest therein, the rules and
procedures of the Depository for such Security, in each case to the extent
applicable to such transaction and as in effect from time to time.
"Authenticating Agent" means any Person authorized by the Trustee pursuant to
Section 6.14 to act on behalf of the Trustee to authenticate the Securities.
"Board of Directors" means either the board of directors of the Corporation or
any executive committee or other committee of that board duly authorized to act
hereunder.
"Board Resolution" means a copy of a resolution certified by the Secretary or
an Assistant Secretary of the Corporation to have been duly adopted by the Board
of Directors, or officers of the Corporation to which authority to act on behalf
of the Board of Directors has been delegated, and to be in full force and effect
on the date of such certification, and delivered to the Trustee.
"Business Day" means any day other than (i) a Saturday or Sunday, (ii) a day
on which banking institutions in The City of New York are authorized or required
by law or executive order to remain closed or (iii) a day on which the Corporate
Trust Office of the Trustee, or, with respect to the Securities initially issued
to Riggs Capital, the principal office of the Property Trustee under the related
Trust Agreement, is closed for business.
"Capital Treatment Event" means, with respect to the Preferred Securities
under the related Trust Agreement, the reasonable determination by the
Corporation (as evidenced by an Officers' Certificate delivered to the Trustee)
that, as a result of the occurrence of any amendment to, or change (including
any announced prospective change) in, the laws (or any regulations thereunder)
of the United States or any political subdivision thereof or therein, or as a
result of any official or administrative pronouncement or action or judicial
decision interpreting or applying such laws or regulations, which amendment or
change is effective or such pronouncement, action or decision is announced on or
after the Original Issue Date of such Preferred Securities, there is more than
an insubstantial risk that the Corporation will not be entitled to treat an
amount equal to the Liquidation Amount of such Preferred Securities as "Tier 1
Capital" (or the then equivalent thereof) for purposes of the capital adequacy
guidelines of the Federal Reserve, as then in effect and applicable to the
Corporation.
"Commission" means the United States Securities and Exchange Commission, as
from time to time constituted, created under the Exchange Act, or if at any time
after the execution of this Indenture such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act, then the
body performing such duties at such time.
"Common Securities" has the meaning specified in the first recital of this
Indenture.
3
<PAGE>
"Common Stock" means the common stock, par value $2.50 per share, of the
Corporation.
"Comparable Treasury Issue" means with respect to any redemption date the
United States Treasury security selected by the Quotation Agent as having a
maturity comparable to the Remaining Life that would be utilized, at the time of
selection and in accordance with customary financial practice, in pricing new
issues of corporate indebtedness securities of comparable maturity to the
Remaining Life. If no United States Treasury security has a maturity which is
within a period from three months before to three months after December 30,
2006, the two most closely corresponding United States Treasury securities shall
be used as the Comparable Treasury Issue, and the Treasury Rate shall be
interpolated or extrapolated on a straight-line basis, rounding to the nearest
month using such securities.
"Comparable Treasury Price" means (A) the average of five Reference Dealer
Treasury Quotations for such redemption date, after excluding the highest and
lowest such Reference Treasury Dealer Quotations, or (B) if the Trustee obtains
fewer than three such Reference Treasury Dealer Quotations, the average of all
such Quotations.
"Corporation" means the Person named as the "Corporation" in the first
paragraph of this Indenture until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Corporation" shall mean such successor Person. "Corporation" includes a
corporation, association, company, joint-stock company or business trust.
"Corporation Request" and "Corporation Order" mean, respectively, the written
request or order signed in the name of the Corporation by the Chairman of the
Board of Directors, the Chairman of the Executive Committee of the Board of
Directors, a Vice Chairman of the Board of Directors, the Chief Executive
Officer, the President, the Chief Operating Officer, a Vice Chairman or a Vice
President, and by the Treasurer, an Assistant Treasurer, the Secretary or an
Assistant Secretary of the Corporation, and delivered to the Trustee.
"Corporate Trust Office" means the principal office of the Trustee at which at
any particular time its corporate trust business shall be administered, which
office as of the date of this Indenture is located at 101 Barclay Street, 21W,
New York, New York 10286, Attention: Corporate Trust and Agency Group--Corporate
Market Services.
"Debt" means with respect to any Person, whether recourse is to all or a
portion of the assets of such Person and whether or not contingent: (i) every
obligation of such Person for money borrowed; (ii) every obligation of such
Person evidenced by bonds, debentures, notes or other similar instruments,
including obligations incurred in connection with the acquisition of property,
assets or businesses; (iii) every reimbursement obligation of such Person with
respect to letters of credit, bankers' acceptances or similar facilities issued
for the account of such Person; (iv) every obligation of such Person issued or
assumed as the deferred purchase price of property or services (but excluding
trade accounts payable or accrued liabilities arising in the ordinary course of
business); (v) every capital lease obligation of such Person; (vi) all
indebtedness of such Person whether incurred on or prior to the date of the
Indenture or
4
<PAGE>
thereafter incurred, for claims in respect of derivative products, including
interest rate, currency and foreign exchange rate and commodity forward
contracts, options and swaps and similar arrangements; and (vii) every
obligation of the type referred to in clauses (i) through (vi) of another Person
and all dividends of another Person the payment of which, in either case, such
Person has guaranteed or is responsible or liable, directly or indirectly, as
obligor or otherwise.
"Defaulted Interest" has the meaning specified in Section 3.8.
"Depositary" means, with respect to the Securities issuable or issued in whole
or in part in the form of one or more Global Securities, the Person designated
as Depositary by the Corporation pursuant to Section 3.1 with respect to such
Securities (or any successor thereto).
"Definitive Security" shall have the meaning ascribed to "Definitive Preferred
Security" in the Trust Agreement.
"Distributions," with respect to the Trust Securities issued by Riggs Capital,
means amounts payable in respect of such Trust Securities as provided in the
Trust Agreement and referred to therein as "Distributions."
"Dollar" means the currency of the United States of America that, as at the
time of payment, is legal tender for the payment of public and private
indebtedness.
"DTC" means The Depository Trust Corporation.
"Event of Default" has the meaning specified in Article V.
"Exchange Act" means the Securities Exchange Act of 1934 and any statute
successor thereto, in each case as amended from time to time.
"Extension Period" has the meaning specified in Section 3.12.
"Global Security" means a Security in the form prescribed in Section 2.4
evidencing all or part of the Securities, issued to the Depositary or its
nominee for the Securities, and registered in the name of such Depositary or its
nominee.
"Global Preferred Security means a Preferred Security, the ownership and
transfers of which shall be made through book entries by a clearing agency, as
described in the Trust Agreement.
"Guarantee Agreement" means the Guarantee Agreement substantially in the form
attached hereto as Annex C as amended from time to time.
"Holder" means a Person in whose name a Security is registered in the
Securities Register.
5
<PAGE>
"Indenture" means this instrument as originally executed or as it may from
time to time be supplemented or amended by one or more indentures supplemental
hereto entered into pursuant to the applicable provisions hereof.
"Interest Payment Date" means as to the Securities the Stated Maturity of an
installment of interest on the Securities.
"Like Amount" means (i) with respect to a redemption of the Preferred
Securities, Preferred Securities having a Liquidation Amount equal to that
portion of the principal amount of the Securities to be contemporaneously
redeemed in accordance with this Indenture, allocated to the Common Securities
and to the Preferred Securities pro rata based upon the relative Liquidation
Amounts of such Securities and the proceeds of which will be used to pay the
Redemption Price of such Preferred Securities and (ii) with respect to a
distribution of the Securities to holders of the Preferred Securities in
exchange therefor in connection with a dissolution or liquidation of Riggs
Capital, Securities having a principal amount equal to the Liquidation Amount of
the Preferred Securities of the holder to whom such Securities would be
distributed.
"Make-Whole Amount" means an amount equal to the greater of (i) 100% of the
principal amount of the Securities or (ii) as determined by a Quotation Agent,
the sum of the present values of the principal amount and premium payable as
part of the Optional Redemption Price with respect to an optional redemption of
such Securities on December 31, 2006, together with scheduled payments of
interest from the redemption date to December 31, 2006 (the "Remaining Life"),
in each case discounted to the redemption date on a semi-annual basis (assuming
a 360-day year consisting of 30-day months) at the Adjusted Treasury Rate.
"Maturity" when used with respect to any Security means the date on which the
principal of such Security becomes due and payable as therein or herein
provided, whether at the Stated Maturity or by declaration of acceleration, call
for redemption or otherwise.
"Moody's" means Moody's Investors Service, Inc.
"Notice of Default" means a written notice of the kind specified in Section
5.1(3).
"Officers' Certificate" means a certificate signed by the Chairman of the
Board of Directors, a Vice Chairman of the Board of Directors, the President or
a Vice President, and by the Treasurer, an Assistant Treasurer, the Secretary or
an Assistant Secretary of the Corporation, and delivered to the Trustee.
"Opinion of Counsel" means a written opinion of counsel, who may be counsel
for the Corporation, and who shall be acceptable to the Trustee.
"Other Securities" means Securities transferred, upon exchange or otherwise,
to holders of "Other Preferred Securities" as defined in the related Trust
Agreement.
6
<PAGE>
"Outstanding" means, when used in reference to any Securities, as of the date
of determination, all Securities theretofore authenticated and delivered under
this Indenture, except:
(i) Securities theretofore canceled by the Trustee or delivered to the
Trustee for cancellation;
(ii) Securities for whose payment money in the necessary amount has been
theretofore deposited with the Trustee or any Paying Agent in trust for the
Holders of such Securities; and
(iii) Securities in substitution for or in lieu of which other Securities
have been authenticated and delivered or which have been paid pursuant to
Section 3.6, unless proof satisfactory to the Trustee is presented that any such
Securities are held by Holders in whose hands such Securities are valid, binding
and legal obligations of the Corporation;
provided, however, that in determining whether the Holders of the requisite
principal amount of Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities owned
by the Corporation or any other obligor upon the Securities or any Affiliate of
the Corporation or such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Securities which a Responsible Officer of the Trustee
actually knows to be so owned shall be so disregarded. Securities so owned which
have been pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Trustee the pledgee's right so to act
with respect to such Securities and that the pledgee is not the Corporation or
any other obligor upon the Securities or any Affiliate of the Corporation or
such other obligor. Upon the written request of the Trustee, the Corporation
shall furnish to the Trustee promptly an Officers' Certificate listing and
identifying all Securities, if any, known by the Corporation to be owned or held
by or for the account of the Corporation, or any other obligor on the Securities
or any Affiliate of the Corporation or such obligor, and, subject to the
provisions of Section 6.1, the Trustee shall be entitled to accept such
Officers' Certificate as conclusive evidence of the facts therein set forth and
of the fact that all Securities not listed therein are Outstanding for the
purpose of any such determination.
"Paying Agent" means the Trustee or any Person authorized by the Corporation
to pay the principal of (and premium, if any) or interest on the Securities on
behalf of the Corporation.
"Person" means any individual, corporation, partnership, joint venture, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Place of Payment" means, with respect to the Securities, the place or places
where the principal of (and premium, if any) and interest on the Securities are
payable pursuant to Section 3.8.
7
<PAGE>
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same indebtedness as that evidenced
by such particular Security; and, for the purposes of this definition, any
security authenticated and delivered under Section 3.4 in lieu of a lost,
destroyed or stolen Security shall be deemed to evidence the same indebtedness
as the lost, destroyed or stolen Security.
"Preferred Securities" has the meaning specified in the first recital of this
Indenture.
"Proceeding" has the meaning specified in Section 12.2.
"Property Trustee" means, in respect of Riggs Capital, the commercial bank or
trust company identified as the "Property Trustee" in the related Trust
Agreement, solely in its capacity as Property Trustee of Riggs Capital under the
Trust Agreement and not in its individual capacity, or its successor in interest
in such capacity, or any successor property trustee appointed as therein
provided.
"Quotation Agent" means Dillon, Read & Co. Inc. and its respective successors;
provided, however, that if the foregoing shall cease to be a primary U.S.
Government securities dealer in New York City (a "Primary Treasury Dealer"), the
Corporation shall substitute therefor another Primary Treasury Dealer.
"Reference Treasury Dealer" means (i) the Quotation Agent and (ii) any other
Primary Treasury Dealer selected by the Trustee after consultation with the
Corporation.
"Redemption Date," when used with respect to any Security to be redeemed,
means the date fixed for such redemption by or pursuant to this Indenture.
"Redemption Price," when used with respect to any Security to be redeemed,
means the price at which it is to be redeemed pursuant to this Indenture.
"Reference Treasury Dealer Quotations" means, with respect to each Reference
Treasury Dealer and any redemption date, the average, as determined by the
Trustee, of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) quoted in
writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m., New York
City time, on the third Business Day preceding such redemption date.
"Regular Record Date" for the interest payable on any Interest Payment Date
with respect to the Securities means the June 15 or December 15 next preceding
such Interest Payment Date (whether or not a Business Day).
"Responsible Officer" means when used with respect to the Trustee, any officer
assigned to the Corporate Trust Office, including any vice president, assistant
vice president, assistant treasurer or any other officer of the Trustee
customarily performing functions similar to those performed by any of the above
designated officers.
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"Restricted Security" means each Security required pursuant to Section 3.6(b)
to bear a Restricted Securities Legend.
"Restricted Securities Legend" means a legend substantially in the form of the
legend required in the form of Security set forth in Section 2.2 to be placed
upon a Restricted Security.
"Riggs Capital" has the meaning specified in the first recital of this
Indenture.
"Riggs Capital Guarantee" means the guarantee by the Corporation of
distributions on the Preferred Securities of Riggs Capital to the extent
provided in the Guarantee Agreement.
"Rights Plan" means a plan of the Corporation providing for the issuance by
the Corporation to all holders of its Common Stock of rights entitling the
holders thereof to subscribe for or purchase shares of Common Stock or any class
or series of preferred stock, which rights (i) are deemed to be transferred with
such shares of Common Stock, (ii) are not exercisable and (iii) are also issued
in respect of future issuances of Common Stock, in each case until the
occurrence of a specified event or events.
"S&P" means Standard & Poor's Ratings Services.
"Securities" or "Security" means any indebtedness securities or indebtedness
security, as the case may be, authenticated and delivered under this Indenture.
"Securities Act" means the Securities Act of 1933 (or any successor statute),
as it may be amended from time to time.
"Securities Register" and "Securities Registrar" have the respective meanings
specified in Section 3.6.
"Senior Debt" means the principal of (and premium, if any) and interest, if
any (including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Corporation whether or not such
claim for post-petition interest is allowed in such proceeding), on Debt,
whether incurred on or prior to the date of the Indenture or thereafter
incurred, unless, in the instrument creating or evidencing the same or pursuant
to which the same is outstanding, it is provided that such obligations are not
superior in right of payment to the Debentures or to other Debt which is pari
passu with, or subordinated to, the Debentures; provided, however, that Senior
Debt shall not be deemed to include: (i) any Debt of the Corporation which when
incurred and without respect to any election under Section 1111(b) of the United
States Bankruptcy Code of 1978, as amended, was without recourse to the
Corporation, (ii) any Debt of the Corporation to any of its subsidiaries and
(iii) Debt to any employee of the Corporation.
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"Special Record Date" for the payment of any Defaulted Interest means a date
fixed by the Trustee pursuant to Section 3.8.
"Stated Maturity" means December 31, 2026.
"Subsidiary" means a corporation more than 50% of the outstanding voting stock
of which is owned, directly or indirectly, by the Corporation or by one or more
other Subsidiaries, or by the Corporation and one or more other Subsidiaries.
For purposes of this definition, "voting stock" means stock which ordinarily has
voting power for the election of directors, whether at all times or only so long
as no senior class of stock has such voting power by reason of any contingency.
"Successor Security" of any particular Security means every Security issued
after, and evidencing all or a portion of the same indebtedness as that
evidenced by, such particular Security; and, for the purposes of this
definition, any Security authenticated and delivered under Section 3.6 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Security shall
be deemed to evidence the same indebtedness as the mutilated, destroyed, lost or
stolen Security.
"Tax Event" means the receipt by Riggs Capital of an Opinion of Counsel (as
defined in the Trust Agreement) experienced in such matters to the effect that,
as a result of any amendment to, or change (including any announced prospective
change) in, the laws (or any regulations thereunder) of the United States or any
political subdivision or taxing authority thereof or therein, or as a result of
any official administrative pronouncement or judicial decision interpreting or
applying such laws or regulations, which amendment or change is effective or
which pronouncement or decision is announced on or after the date of issuance of
the Preferred Securities of Riggs Capital, there is more than an insubstantial
risk that (i) Riggs Capital is, or will be within 90 days of the date of such
Opinion of Counsel, subject to United States federal income tax with respect to
income received or accrued on the corresponding Securities issued by the
Corporation to Riggs Capital, (ii) interest payable by the Corporation on the
Securities is not, or within 90 days of the date of such Opinion of Counsel,
will not be, deductible by the Corporation, in whole or in part, for United
States federal income tax purposes or (iii) Riggs Capital is, or will be within
90 days of the date of such Opinion of Counsel, subject to more than a de
minimis amount of other taxes, duties or other governmental charges.
"Treasury Rate" means (i) the yield, under the heading which represents the
average for the immediately prior week, appearing in the most recently published
statistical release designated "H.15(519)" or any successor publication which is
published weekly by the Federal Reserve and which establishes yields on actively
traded United States Treasury securities adjusted to constant maturity under the
caption "Treasury Constant Maturities", for the maturity corresponding to the
Remaining Life (if no maturity is within three months before or after the
Remaining Life, yields for the two published maturities most closely
corresponding to the Remaining Life shall be determined and the treasury Rate
shall be interpolated or extrapolated from such yields on a straight-line,
rounding to the nearest month) or (ii) if such release (or any successor
release)
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is not published during the week preceding the calculation date or does not
contain such yields, the rate per annum equal to the semi-annually equivalent
yield to maturity of the Comparable Treasury Issue, calculated using a price for
the Comparable Treasury Issue (expressed as a percentage of its principal
amount) equal to the Comparable Treasury Price for such redemption date. The
Treasury Rate shall be calculated on the third Business Day preceding the
redemption date.
"Trust Agreement" means the Trust Agreement substantially in the form attached
hereto as Annex A, as amended by the form of Amended and Restated Trust
Agreement substantially in the form attached hereto as Annex B in each case as
amended from time to time.
"Trustee" means the Person named as the "Trustee" in the first paragraph of
this instrument until a successor Trustee shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Trustee" shall mean or
include each Person who is then a Trustee hereunder and, if at any time there is
more than one such Person, "Trustee" as used with respect to the Securities
shall mean the Trustee with respect to the Securities.
"Trust Indenture Act" means the Trust Indenture Act of 1939 (15 U.S.C. (S)(S)
77aaa-77bbb), as amended and as in effect on the date as of this Indenture,
except as provided in Section 9.5.
"Trust Securities" has the meaning specified in the first recital of this
Indenture.
"Vice President" when used with respect to the Corporation, means any duly
appointed vice president, whether or not designated by a number or a word or
words added before or after the title "vice president."
Section 1.2. Compliance Certificate and Opinions.
Upon any application or request by the Corporation to the Trustee to take any
action under any provision of this Indenture, the Corporation shall furnish to
the Trustee an Officers' Certificate stating that all conditions precedent
(including covenants, compliance with which constitutes a condition precedent),
if any, provided for in this Indenture relating to the proposed action have been
complied with and an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent (including covenants compliance with which
constitute a condition precedent), if any, have been complied with, except that
in the case of any such application or request as to which the furnishing of
such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate or
opinion need be furnished.
Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture (other than the certificates provided
pursuant to Section 10.4) shall include:
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(1) a statement that each individual signing such certificate or opinion has
read such covenant or condition and the definitions herein relating thereto;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and
(4) a statement as to whether, in the opinion of each such individual, such
condition or covenant has been complied with.
Section 1.3. Forms of Documents Delivered to Trustee.
In any case where several matters are required to be certified by, or covered
by an opinion of, any specified Person, it is not necessary that all such
matters be certified by, or covered by the opinion of, only one such Person, or
that they be so certified or covered by only one document, but one such Person
may certify or give an opinion with respect to some matters and one or more
other such Persons as to other matters, and any such Person may certify or give
an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Corporation may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to matters upon which his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Corporation stating that the
information with respect to such factual matters is in the possession of the
Corporation, unless such counsel knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect to
such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions, or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Section 1.4. Acts of Holders.
(a) Any request, demand, authorization, direction, notice, consent, waiver or
other action provided by this Indenture to be given to or taken by Holders may
be embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Holders in person or by an agent duly appointed in writing;
and, except as herein otherwise expressly provided, such
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action shall become effective when such instrument or instruments is or are
delivered to the Trustee, and, where it is hereby expressly required, to the
Corporation. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "Act" of the Holders
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Indenture and (subject to Section 6.1) conclusive in favor of
the Trustee and the Corporation, if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such instrument or
writing may be proved by the affidavit of a witness of such execution or by the
certificate of any notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him the execution thereof. Where such execution is by
a Person acting in other than his individual capacity, such certificate or
affidavit shall also constitute sufficient proof of his authority.
(c) The fact and date of the execution by any Person of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustee deems sufficient and in accordance with
such reasonable rules as the Trustee may determine.
(d) The ownership of Securities shall be proved by the Securities Register.
(e) Any request, demand, authorization, direction, notice, consent, waiver or
other action by any Holder of the Securities shall bind every future Holder of
the same Securities and the Holder of Securities issued upon the transfer
thereof or in exchange therefor or in lieu thereof in respect of anything done
or suffered to be done by the Trustee or the Corporation in reliance thereon,
whether or not notation of such action is made upon such Securities.
(f) The Corporation may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities entitled to give, make or take
any request, demand, authorization, direction, notice, consent, waiver or other
action provided or permitted by this Indenture to be given, made or taken by
Holders of the Securities, provided that the Corporation may not set a record
date for, and the provisions of this paragraph shall not apply with respect to,
the giving or making of any notice, declaration, request or direction referred
to in the next paragraph. If any record date is set pursuant to this paragraph,
the Holders of the Outstanding Securities on such record date, and no other
Holders, shall be entitled to take the relevant action, whether or not such
Holders remain Holders after such record date, provided that no such action
shall be effective hereunder unless taken on or prior to the applicable
Expiration Date (as hereinafter in this Section 1.4(f) provided) by Holders of
the requisite principal amount of Outstanding Securities on such record date.
Nothing in this paragraph shall be construed to prevent the Corporation from
setting a new record date for any action for which a record date has previously
been set pursuant to this paragraph (whereupon the record date previously set
shall automatically and with no action by any Person be cancelled and of no
effect), and nothing
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in this paragraph shall be construed to render ineffective any action taken by
Holders of the requisite principal amount of Outstanding Securities on the date
such action is taken. Promptly after any record date is set pursuant to this
paragraph, the Corporation, at its own expense, shall cause notice of such
record date, the proposed action by Holders and the applicable Expiration Date
to be given to the Trustee in writing and to each Holder of Securities in the
manner set forth in Section 1.6.
The Trustee may set any day as a record date for the purpose of determining
the Holders of Outstanding Securities entitled to join in the giving or making
of (i) any Notice of Default, (ii) any declaration of acceleration referred to
in Section 5.2, (iii) any request to institute proceedings referred to in
Section 5.7(2) or (iv) any direction referred to in Section 5.12, in each case
with respect to the Securities. If any record date is set pursuant to this
paragraph, the Holders of Outstanding Securities on such record date, and no
other Holders, shall be entitled to join in such notice, declaration, request or
direction, whether or not such Holders remain Holders after such record date,
provided that no such action shall be effective hereunder unless taken on or
prior to the applicable Expiration Date by Holders of the requisite principal
amount of Outstanding Securities on such record date. Nothing in this paragraph
shall be construed to prevent the Trustee from setting a new record date for any
action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and with
no action by any Person be cancelled and of no effect), and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite principal amount of Outstanding Securities on the date such
action is taken. Promptly after any record date is set pursuant to this
paragraph, the Trustee, at the Corporation's expense, shall cause notice of such
record date, the proposed action by Holders and the applicable Expiration Date
to be given to the Corporation in writing and to each Holder of Securities in
the manner set forth in Section 1.6.
With respect to any record date set pursuant to this Section, the party hereto
which sets such record dates may designate any day as the "Expiration Date" and
from time to time may change the Expiration Date to any earlier or later day,
provided that no such change shall be effective unless notice of the proposed
new Expiration Date is given to the other party hereto in writing, and to each
Holder of Securities in the manner set forth in Section 1.6, on or prior to the
existing Expiration Date. If an Expiration Date is not designated with respect
to any record date set pursuant to this Section, the party hereto which set such
record date shall be deemed to have initially designated the 180th day after
such record date as the Expiration Date with respect thereto, subject to its
right to change the Expiration Date as provided in this paragraph.
Notwithstanding the foregoing, no Expiration Date shall be later than the 180th
day after the applicable record date.
(g) Without limiting the foregoing, a Holder entitled hereunder to take any
action hereunder with regard to the Securities may do so with regard to all or
any part of the principal amount of such Security or by one or more duly
appointed agents each of which may do so pursuant to such appointment with
regard to all or any part of such principal amount.
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Section 1.5. Notices, Etc. to Trustee and Corporation.
Any request, demand, authorization, direction, notice, consent, waiver or Act
of Holders or other document provided or permitted by this Indenture to be made
upon, given or furnished to, or filed with,
(1) the Trustee by any Holder, any holder of Preferred Securities or the
Corporation shall be sufficient for every purpose hereunder if made, given,
furnished or filed in writing to or with the Trustee at its Corporate Trust
Office, or
(2) the Corporation by the Trustee, any Holder or any holder of Preferred
Securities shall be sufficient for every purpose (except as otherwise provided
in Section 5.1) hereunder if in writing and mailed, first class, postage
prepaid, to the Corporation addressed to it at the address of its principal
office specified in the first paragraph of this instrument or at any other
address previously furnished in writing to the Trustee by the Corporation.
Section 1.6. Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event, such notice
shall be sufficiently given (unless otherwise herein expressly provided) if in
writing and mailed, first class postage prepaid, to each Holder affected by such
event, at the address of such Holder as it appears in the Securities Register,
not later than the latest date, and not earlier than the earliest date,
prescribed for the giving of such notice. In any case where notice to Holders is
given by mail, neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Holder shall affect the sufficiency of such
notice with respect to other Holders. In case, by reason of the suspension of or
irregularities in regular mail service or for any other reason, it shall be
impossible or impracticable to mail notice of any event to Holders when said
notice is required to be given pursuant to any provision of this Indenture or of
the relevant Securities, then any manner of giving such notice as shall be
satisfactory to the Trustee shall be deemed to be a sufficient giving of such
notice. Where this Indenture provides for notice in any manner, such notice may
be waived in writing by the Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Holders shall be filed with the Trustee, but such
filing shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
Section 1.7. Conflict with Trust Indenture Act.
If any provision of this Indenture limits, qualifies or conflicts with the
duties imposed by any of Sections 310 to 317, inclusive, of the Trust Indenture
Act through operation of Section 318(c) thereof, such imposed duties shall
control. This Indenture, the Corporation and the Trustee shall be deemed for all
purposes hereof to be subject to and governed by the Trust Indenture Act to the
same extent as would be the case if this Indenture were so qualified on the date
hereof.
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Section 1.8. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
Section 1.9. Successors and Assigns.
All covenants and agreements in this Indenture by the Corporation shall bind
its successors and assigns, whether so expressed or not.
Section 1.10. Separability Clause.
In case any provision in this Indenture or in the Securities shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
Section 1.11 Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or implied, shall give
to any Person, other than the parties hereto and their successors and assigns,
the holders of Senior Debt, the Holders of the Securities and, to the extent
expressly provided in Sections 5.2, 5.8, 5.9, 5.11, 5.13, 9.1 and 9.2, the
holders of Preferred Securities, any benefit or any legal or equitable right,
remedy or claim under this Indenture.
Section 1.12. Governing Law.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF
LAW PRINCIPLES THEREOF.
Section 1.13. Non-Business Days.
In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Security shall not be a Business Day, then (notwithstanding any
other provision of this Indenture or the Securities) payment of interest or
principal (and premium, if any) need not be made on such date, but may be made
on the next succeeding Business Day (and no interest shall accrue for the period
from and after such Interest Payment Date, Redemption Date or Stated Maturity,
as the case may be, until such next succeeding Business Day) except that, if
such Business Day is in the next succeeding calendar year, such payment shall be
made on the immediately preceding Business Day (in each case with the same force
and effect as if made on the Interest Payment Date or Redemption Date or at the
Stated Maturity).
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ARTICLE II
SECURITY FORMS
Section 2.1. Forms Generally.
The Securities and the Trustee's certificate of authentication shall be in
substantially the forms set forth in this Article, with such appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon as may be
required to comply with applicable tax laws or the rules of any securities
exchange or as may, consistently herewith, be determined by the officers
executing such Securities, as evidenced by their execution of the Securities.
The Trustee's certificate of authentication shall be substantially in the form
set forth in this Article.
The definitive Securities shall be printed, lithographed or engraved or
produced by any combination of these methods, if required by any securities
exchange on which the Securities may be listed, on a steel engraved border or
steel engraved borders or may be produced in any other manner permitted by the
rules of any securities exchange on which the Securities may be listed, all as
determined by the officers executing such Securities, as evidenced by their
execution of such securities.
Securities distributed to holders of beneficial interests in a Global
Preferred Security upon the dissolution of Riggs Capital shall be distributed in
the form of one or more Global Securities registered in the name of a Depository
or its nominee, and deposited with the Securities Registrar, as custodian for
such Depository, or held by such Depository, for credit by the Depository to the
respective accounts of the beneficial owners of the Securities represented
thereby (or such other accounts as they may direct). Securities distributed to
holders of Certificated Preferred Securities upon the dissolution of Riggs
Capital shall not be issued in the form of a Global Security or any other form
intended to facilitate book-entry trading in beneficial interests in such
Securities.
Section 2.2. Form of Face of Security.
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT
OF 1933 (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS SECURITY,
AGREES FOR THE BENEFIT OF THE SERIES A ISSUER THAT (A) THIS SECURITY MAY NOT BE
RESOLD, PLEDGED OR OTHERWISE TRANSFERRED OTHER THAN (1) TO THE SERIES A ISSUER
OR ANY AFFILIATE THEREOF, (2) SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE
PURSUANT
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TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON WHO THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A, PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR OTHER
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (3) IN AN "OFFSHORE
TRANSACTION" (AS DEFINED IN REGULATION S) IN ACCORDANCE WITH REGULATION S UNDER
THE SECURITIES ACT, (4) TO A PERSON THAT IS AN "ACCREDITED INVESTOR" AS DEFINED
IN RULE 501(A) UNDER THE SECURITIES ACT THAT IS ACQUIRING THIS SECURITY FOR
INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT,
(5) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED
BY RULE 144 (IF APPLICABLE) UNDER THE SECURITIES ACT OR (6) PURSUANT TO AN
EFFECTIVE REGISTRATION UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH
ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, OR ANY
APPLICABLE JURISDICTION, (B) IT WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO,
NOTIFY ANY PURCHASER FROM IT OF THIS SECURITY OF THE RESALE RESTRICTIONS SET
FORTH IN (A) ABOVE, AND (C) WITH RESPECT TO ANY TRANSFER OF THIS SECURITY BY AN
ACCREDITED INVESTOR OR IN AN "OFFSHORE TRANSACTION", IT WILL DELIVER TO THE
SERIES A ISSUER AND THE PROPERTY TRUSTEE SUCH CERTIFICATES, LEGAL OPINIONS AND
OTHER INFORMATION AS THEY MAY REQUIRE TO CONFIRM THAT THE TRANSFER BY IT
COMPLIES WITH APPLICABLE LAW. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY,
REPRESENTS AND AGREES FOR THE BENEFIT OF THE SERIES A ISSUER THAT IT IS (1) A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A OR (2) A PERSON
THAT IS AN "ACCREDITED INVESTOR" AS DEFINED IN RULE 501(A) UNDER THE SECURITIES
ACT THAT IS HOLDING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR (3) NOT A U.S. PERSON AND
THAT IT IS OUTSIDE THE UNITED STATES WITHIN THE MEANING OF, OR AN ACCOUNT
SATISFYING THE REQUIREMENTS OF, PARAGRAPH (O) OF RULE 902 UNDER REGULATION S
UNDER THE SECURITIES ACT. THIS SECURITY WILL BE ISSUED, AND MAY BE TRANSFERRED,
ONLY IN BLOCKS HAVING A LIQUIDATION AMOUNT OF NOT LESS THAN $100,000. ANY
TRANSFER, SALE OR OTHER DISPOSITION OF THIS SECURITY IN A BLOCK HAVING A
LIQUIDATION AMOUNT OF LESS THAN $100,000 SHALL BE DEEMED TO BE VOID AND OF NO
LEGAL EFFECT WHATSOEVER. ANY SUCH TRANSFEREE SHALL BE DEEMED NOT TO BE THE
HOLDER OF SUCH SECURITIES FOR ANY PURPOSE, INCLUDING BUT NOT LIMITED TO THE
RECEIPT OF INTEREST ON SUCH SECURITIES, AND SUCH TRANSFEREE SHALL BE DEEMED TO
HAVE NO INTEREST WHATSOEVER IN SUCH SECURITIES.
THE HOLDER, BY PURCHASING THIS SECURITY, IS DEEMED TO REPRESENT THAT IT (X) IS
NOT ITSELF, AND IS NOT ACQUIRING THE SECURITY WITH THE
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ASSETS OF, (i) AN "EMPLOYEE BENEFIT PLAN" (WITHIN THE MEANING OF SECTION 3(3) OF
ERISA), A "PLAN" (WITHIN THE MEANING OF SECTION 4975(e)(i) OF THE INTERNAL
REVENUE CODE), OR AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY
REASON OF INVESTMENT IN THE ENTITY BY SUCH AN "EMPLOYEE BENEFIT PLAN" OR "PLAN"
AND THE APPLICATION OF THE PLAN ASSET REGULATION OR (ii) A "GOVERNMENTAL PLAN"
(WITHIN THE MEANING OF SECTION 3(32) OF ERISA) OR (Y)(i) IS ITSELF, OR IS
ACQUIRING THE SECURITY WITH THE ASSETS OF, AN "INVESTMENT FUND" (WITHIN THE
MEANING OF PART V(b) OF U.S. DEPARTMENT OF LABOR PTE 84-14) MANAGED BY A
"QUALIFIED PROFESSIONAL ASSET MANAGER" (WITHIN THE MEANING OF PART V (a) OF PTE
84-14) WHICH HAS MADE OR PROPERLY AUTHORIZED THE DECISION FOR SUCH FUND TO
PURCHASE THE SECURITIES, UNDER CIRCUMSTANCES SUCH THAT PTE 84-14 IS APPLICABLE
TO THE PURCHASE AND HOLDING OF SUCH SECURITIES, (ii) IS AN INSURANCE COMPANY
POOLED SEPARATE ACCOUNT PURCHASING SECURITIES PURSUANT TO PART I OF U.S.
DEPARTMENT OF LABOR PTE 90-1 OR A BANK COLLECTIVE INVESTMENT FUND PURCHASING
PURSUANT TO PART I OF U.S. DEPARTMENT OF LABOR PTE 91-38, AND IN EITHER CASE, NO
"PLAN" OR "EMPLOYEE BENEFIT PLAN" NOT PURCHASING PURSUANT TO PTE 84-14 OWNS MORE
THAN 10% OF THE ASSETS OF SUCH ACCOUNT OR COLLECTIVE FUND (WHEN AGGREGATED WITH
OTHER PLANS OF THE SAME EMPLOYER OR EMPLOYEE ORGANIZATION, (iii) IS AN INSURANCE
COMPANY USING THE ASSETS OF THE GENERAL ASSET ACCOUNT OF THE INSURANCE COMPANY
TO PURCHASE THE SECURITIES PURSUANT TO PART I OF THE U.S. DEPARTMENT OF LABOR
PTE 95-60, IN WHICH CASE THE RESERVES AND LIABILITIES FOR THE GENERAL ACCOUNT
CONTRACTS HELD BY OR ON BEHALF OF ANY PLAN, TOGETHER WITH ANY OTHER PLANS
MAINTAINED BY THE SAME EMPLOYER OR EMPLOYEE ORGANIZATION, DO NOT EXCEED 10% OF
THE TOTAL RESERVES AND LIABILITIES OF THE INSURANCE COMPANY GENERAL ACCOUNT
(EXCLUSIVE OF SEPARATE ACCOUNT LIABILITIES), PLUS SURPLUS AS SET FORTH IN THE
NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS ANNUAL STATEMENT FILED WITH THE
STATE OF DOMICILE OF THE INSURER OR (IV) IS A PLAN ACQUIRING THE SERIES A
PREFERRED SECURITIES WITH ASSETS OVER WHICH AN IN-HOUSE ASSET MANAGER (WITHIN
THE MEANING OF PART IV(a) OF PTE 96-23) HAS DISCRETIONARY AUTHORITY, UNDER
CIRCUMSTANCES SUCH THAT PTE 96-23 IS APPLICABLE TO THE PURCHASE AND HOLDING OF
SUCH SECURITIES.
RIGGS NATIONAL CORPORATION
8 5/8% JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES, SERIES A, DUE
DECEMBER 31, 2026
No. $154,640,000
19
<PAGE>
RIGGS NATIONAL CORPORATION, a corporation organized and existing under the
laws of Delaware (hereinafter called the "Corporation", which term includes any
successor corporation under the Indenture hereinafter referred to), for value
received, hereby promises to pay to Riggs Capital, or registered assigns, the
principal sum of One Hundred and Fifty-Four Million, Six Hundred and Forty
Thousand Dollars ($154,640,000) or such other principal amount as may be set
forth in the records of the Securities Registrar hereinafter referred to in
accordance with the Indenture, on December 31, 2026. The Corporation further
promises to pay interest on said principal sum from December 13, 1996 or from
the most recent date (each such date, an "Interest Payment Date") to which
interest has been paid or duly provided for, semi-annually (subject to deferral
as set forth herein) in arrears on June 30 and December 31 of each year,
commencing on June 30, 1997 at the rate of 8 5/8% per annum, until the principal
hereof shall have become due and payable, plus Additional Interest, if any,
until the principal hereof is paid or duly provided for or made available for
payment and on any overdue principal and (without duplication and to the extent
that payment of such interest is enforceable under applicable law) on any
overdue installment of interest at the rate of 8 5/8% per annum, compounded
semi-annually. The amount of interest payable for any period less than a full
interest period shall be computed on the basis of twelve 30-day months and a
360-day year. In the event that any date on which interest is payable on this
Security is not a Business Day, then a payment of the interest payable on such
date will be made on the next succeeding day which is a Business Day (and
without any interest or other payment in respect of any such delay), except
that, if such Business Day is in the next succeeding calendar year, such payment
shall be made on the immediately preceding Business Day, in each case with the
same force and effect as if made on the date the payment was originally payable.
A "Business Day" shall mean any day other than (i) a Saturday or Sunday, (ii) a
day on which banking institutions in The City of New York are authorized or
required by law or executive order to remain closed or (iii) a day on which the
Corporate Trust Office of the Trustee, or the principal office of the Property
Trustee under the Trust Agreement hereinafter referred to, for Riggs Capital, is
closed for business. The interest installment so payable, and punctually paid or
duly provided for, on any Interest Payment Date will, as provided in the
Indenture, be paid to the Person in whose name this Security (or one or more
Predecessor Securities is registered at the close of business on the Regular
Record Date for such interest installment, which shall be the June 15 or
December 15 (whether or not a Business Day) next preceding such Interest Payment
Date. Any such interest installment not so punctually paid or duly provided for
shall forthwith cease to be payable to the Holder on such Regular Record Date
and may either be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on a Special
Record Date for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to Holders of Securities not less than 10
days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities may be listed, and upon such notice as may be required
by such exchange, all as more fully provided in said Indenture.
So long as no Event of Default has occurred and is continuing, the Corporation
shall have the right at any time during the term of this Security to defer
payment of interest on this
20
<PAGE>
Security, at any time or from time to time, for up to 10 consecutive semi-annual
interest payment periods with respect to each deferral period (each an
"Extension Period"), and at the end of which the Corporation shall pay all
interest then accrued and unpaid (together with Additional Interest thereon to
the extent permitted by applicable law); provided, however, that no Extension
Period shall extend beyond the Stated Maturity of the principal of this
Security; provided, further, that during any such Extension Period, the
Corporation shall not, and shall not permit any Subsidiary of the Corporation
to, (i) declare or pay any dividends or distributions on, or redeem, purchase,
acquire or make a liquidation payment with respect to, any of the Corporation's
capital stock or (ii) make any payment of principal, interest or premium, if
any, on or repay, repurchase or redeem any indebtedness securities of the
Corporation that rank pari passu with or junior in interest to this Security or
(iii) make any guarantee payments with respect to any guarantee by the
Corporation of the debt securities of any Subsidiary of the Corporation if such
guarantee ranks pari passu with or junior in interest to this Security (other
than (a) dividends or distributions in Common Stock of the Corporation, (b) any
declaration of a dividend in connection with the implementation of a Rights Plan
or the issuance of any Common Stock or any class or series of preferred stock of
the Corporation under any Rights Plan in the future or the redemption or
repurchase of any rights distributed pursuant to a Rights Plan, (c) payments
under the Riggs Capital Guarantee, and (d) purchases of Common Stock related to
the issuance of Common Stock or rights under any of the Corporation's benefit
plans for its directors, officers or employees). Prior to the termination of any
such Extension Period, the Corporation may further defer the payment of
interest, provided that no Extension Period shall exceed 10 consecutive semi-
annual periods or extend beyond the Stated Maturity of the principal of this
Security. Upon the termination of any such Extension Period and upon the payment
of all amounts then due on any Interest Payment Date, the Corporation may elect
to begin a new Extension Period, subject to the above requirements. No interest
shall be due and payable during an Extension Period except at the end thereof.
The Corporation shall give the Property Trustee, the Administrative Trustee and
the Trustee notice of its election to begin any Extension Period at least one
Business Day prior to the earlier of (i) the date interest on the Securities
would have been payable except for the election to begin such Extension Period
or (ii) the date the Administrative Trustees are required to give notice to DTC
or an applicable self-regulatory organization or to holders of the Preferred
Securities as of the record date or the date Distributions on the Preferred
Securities are payable, but in any event not less than one Business Day prior to
such record date.
Payment of the principal of (and premium, if any) and interest on this
Security will be made at the office or agency of the Trustee in The City of New
York or at the offices of such Paying Agents or Agents as the Corporation may
designate from time to time outside the United States, in such coin or currency
of the United States of America as at the time of payment is legal tender for
payment of public and private indebtedness; provided, however, that at the
option of the Corporation payment of interest may be made (i) by check mailed to
the address of the Person entitled thereto as such address shall appear in the
Securities Register or (ii) by wire transfer in immediately available funds at
such place and to such account as may be designated
21
<PAGE>
in writing at least 15 days prior to the relevant Interest Payment Date by the
Person entitled thereto as specified in the Securities Register.
The indebtedness evidenced by this Security is, to the extent provided in the
Indenture, subordinate and junior in right of payment to the prior payment in
full of all Senior Debt, and this Security is issued subject to the provisions
of the Indenture with respect thereto. Each Holder hereof by accepting the same,
(a) agrees to and shall be bound by such provisions, (b) authorizes and directs
the Trustee on his behalf to take such actions as may be necessary or
appropriate to effectuate the subordination so provided and (c) appoints the
Trustee his attorney-in-fact for any and all such purposes. Each Holder hereof,
by his acceptance hereof, waives all notice of the acceptance of the
subordination provisions contained herein and in the Indenture by each holder of
Senior Debt, whether now outstanding or hereafter incurred, and waives reliance
by each such holder upon said provisions.
Reference is hereby made to the further provisions of this Security set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Corporation has caused this instrument to be duly
executed under its corporate seal.
RIGGS NATIONAL CORPORATION
By: ________________________________________
[President, Vice President, Treasurer or
Assistant Treasurer]
Attest:
Section 2.3. Form of Reverse of Security.
This Security is one of a duly authorized issue of securities of the
Corporation designated as its 8 5/8% Junior Subordinated Deferrable Interest
Debentures, Series A, Due December 31, 2026 (herein called the "Securities"),
limited in aggregate principal amount to $154,640,000, issued and to be issued
under a Junior Subordinated Indenture, dated as of December 13, 1996
22
<PAGE>
(herein called the "Indenture"), between the Corporation and The Bank of New
York, as Trustee (herein called the "Trustee"), which term includes any
successor trustee under the Indenture), to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the respective
rights, limitations of rights, duties and immunities thereunder of the Trustee,
the Corporation and the Holders of the Securities, and of the terms upon which
the Securities are, and are to be, authenticated and delivered. This Security is
designated on the face hereof, limited in aggregate principal amount to
$154,640,000.
All terms used in this Security that are defined in the Indenture or in the
Amended and Restated Trust Agreement, dated as of December 13, 1996, as amended
(the "Trust Agreement"), for Riggs Capital, entered into among RIGGS NATIONAL
CORPORATION, as Depositor, and the Trustees named therein, shall have the
meanings assigned to them in the Indenture or the Trust Agreement, as the case
may be.
The Corporation may, at its option, on or after December 31, 2006, and subject
to the terms and conditions of Article XI of the Indenture, redeem this Security
in whole at any time or in part from time to time, at the following Redemption
Prices (expressed as percentages of the principal amount), plus in each case
accrued interest thereon to the date of redemption. If redeemed during the
twelve-month period indicated,
<TABLE>
<CAPTION>
Redemption Price
----------------
<S> <C>
December 31, 2006 to December 31, 2007: 104.313%
December 31, 2007 to December 31, 2008: 103.881%
December 31, 2008 to December 31, 2009: 103.450%
December 31, 2009 to December 31, 2010: 103.019%
December 31, 2010 to December 31, 2011: 102.588%
December 31, 2011 to December 31, 2012: 102.156%
December 31, 2012 to December 31, 2013: 101.725%
December 31, 2013 to December 31, 2014: 101.294%
December 31, 2014 to December 31, 2015: 100.863%
December 31, 2015 to December 31, 2016: 100.431%
On or after December 31, 2016: 100%
</TABLE>
At any time prior to December 31, 2006, upon the occurrence and during the
continuation of a Tax Event or Capital Treatment Event in respect of Riggs
Capital, the Corporation may, at its option, at any time within 90 days of the
occurrence of such Tax Event or Capital Treatment Event redeem the Securities,
in whole but not in part, subject to the provisions of Section 11.7 and the
other provisions of Article XI of the Indenture, at a redemption price equal to
the Make-Whole Amount plus, in each case, accrued and unpaid interest on the
Securities to the date fixed for redemption.
23
<PAGE>
In the event of redemption of this Security in part only, a new Security or
Securities for the unredeemed portion hereof will be issued in the name of the
Holder hereof upon the cancellation hereof.
The Indenture contains provisions for satisfaction and discharge of the entire
indebtedness of this Security upon compliance by the Corporation with certain
conditions set forth in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the
Corporation and the Trustee at any time to enter into a supplemental indenture
or indentures for the purpose of modifying in any manner the rights and
obligations of the Corporation and of the Holders of the Securities, with the
consent of the Holders of not less than a majority in principal amount of the
Outstanding Securities to be affected by such supplemental indenture. The
Indenture also contains provisions permitting Holders of specified percentages
in principal amount of the Securities at the time Outstanding, on behalf of the
Holders of all Securities, to waive compliance by the Corporation with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Security
shall be conclusive and binding upon such Holder and upon all future Holders of
this Security and of any Security issued upon the registration of transfer
hereof or in exchange herefor or in lieu hereof, whether or not notation of such
consent or waiver is made upon this Security.
As provided in and subject to the provisions of the Indenture, if an Event of
Default with respect to the Securities at the time Outstanding occurs and is
continuing, then and in every such case the Trustee or the Holders of not less
than 25% in principal amount of the Outstanding Securities may declare the
principal amount of all the Securities to be due and payable immediately, by a
notice in writing to the Corporation (and to the Trustee if given by Holders),
provided that, so long as the Securities are held by Riggs Capital, if upon an
Event of Default, the Trustee or the Holders of not less than 25% in principal
amount of the Outstanding Securities fails to declare the principal of all the
Securities to be immediately due and payable, the holders of at least 25% in
aggregate Liquidation Amount of the Preferred Securities of Riggs Capital then
outstanding shall have such right by a notice in writing to the Corporation and
the Trustee; and upon any such declaration the principal amount of and the
accrued interest (including any Additional Interest) on all the Securities shall
become immediately due and payable, provided that the payment of principal and
interest (including any Additional Interest) on such Securities shall remain
subordinated to the extent provided in Article XII of the Indenture.
No reference herein to the Indenture and no provision of this Security or of
the Indenture shall alter or impair the obligation of the Corporation, which is
absolute and unconditional, to pay the principal of (and premium, if any) and
interest on this Security at the times, place and rate, and in the coin or
currency, herein prescribed.
24
<PAGE>
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Security is registrable in the Securities Register,
upon surrender of this Security for registration of transfer at the office or
agency of the Corporation maintained under Section 10.2 of the Indenture duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Corporation and the Securities Registrar duly executed by,
the Holder hereof or his attorney duly authorized in writing, and thereupon one
or more new Securities, of authorized denominations and for the same aggregate
principal amount, will be issued to the designated transferee or transferees. No
service charge shall be made for any such registration of transfer or exchange,
but the Corporation may require payment of a sum sufficient to cover any tax or
other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of transfer, the
Corporation, the Trustee and any agent of the Corporation or the Trustee shall
treat the Person in whose name this Security is registered as the owner hereof
for all purposes, whether or not this Security be overdue, and neither the
Corporation, the Trustee nor any such agent shall be affected by notice to the
contrary.
The Securities are issuable only in registered form without coupons in minimum
denominations of $100,000 and any integral multiples of $1,000 in excess
thereof. As provided in the Indenture and subject to certain limitations therein
set forth, Securities are exchangeable for a like aggregate principal amount of
Securities of a different authorized denomination, as requested by the Holder
surrendering the same.
The Corporation and, by its acceptance of this Security or a beneficial
interest therein, the Holder of, and any Person that acquires a beneficial
interest in, this Security agree that for United States federal, state and local
tax purposes it is intended that this Security constitute indebtedness.
THE INDENTURE AND THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICT
OF LAW PRINCIPLES THEREOF.
Section 2.4. Additional Provisions Required in Global Security.
Any Global Security issued hereunder shall, in addition to the provisions
contained in Sections 2.2 and 2.3, bear a legend in substantially the following
form:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A
NOMINEE OF A DEPOSITORY. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED
IN THE NAME OF A PERSON
25
<PAGE>
OTHER THAN THE DEPOSITORY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES
DESCRIBED IN THE INDENTURE AND MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE
DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO
THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY.
Section 2.5. Form of Trustee's Certificate of Authentication.
This is one of the Securities referred to in the within mentioned Indenture.
Dated:
The Bank of New York
as Trustee
By:____________________________
Authorized Signatory
ARTICLE III
THE SECURITIES
Section 3.1. Title and Terms.
The aggregate principal amount of Securities which may be authenticated and
delivered under this Indenture is limited to $154,640,000 except for Securities
authenticated and delivered upon registration of transfer of, or in exchange
for, or in lieu of, other Securities pursuant to Section 3.4, 3.5, 3.6, 9.6 or
11.6.
The Securities shall be known and designated as the 8 5/8% Junior Subordinated
Deferrable Interest Debentures, Series A, Due December 31, 2026, of the
Corporation. Their Stated Maturity shall be December 31, 2026, and they shall
bear interest at the rate of 8 5/8% per annum, from December 13, 1996 or from
the most recent Interest Payment Due to which interest has been paid or duly
provided for, as the case may be, payable semi-annually on June 30 and December
31, commencing June 30, 1997, until the principal thereof is paid or made
available for payment.
The principal of (and premium, if any) and interest on the Securities shall be
payable at the office or agency of the Corporation in New York, New York
maintained for such purpose and at any other office or agency maintained by the
Corporation for such purpose; provided, however, that at the option of the
Corporation payment of interest may be made (i) by check mailed to the address
of the Person entitled thereto as such address shall appear in the Securities
Register or (ii) by wire transfer in immediately available funds at such place
and to such account
26
<PAGE>
as may be designated in writing at least 15 days prior to the relevant Interest
Payment Date by the person entitled thereto as specified in the Securities
Register.
The Securities shall be redeemable as provided in Article XI.
The Securities shall be subordinated in right of payment to Senior Debt as
provided in Article XII.
All Securities shall be substantially identical except as to denomination and
except as may otherwise be provided herein.
Section 3.2. Denominations.
The Securities shall be in registered form without coupons and shall be
issuable in denominations of $100,000 and any integral multiple of $1,000 in
excess thereof.
Section 3.3. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Corporation by its
President, one of its Vice Presidents, its Treasurer or an Assistant Treasurer
under its corporate seal reproduced or impressed thereon and attested by its
Secretary or one of its Assistant Secretaries. The signature of any of these
officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals who were
at any time the proper officers of the Corporation shall bind the Corporation,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities. At any time and from time to
time after the execution and delivery of this Indenture, the Corporation may
deliver the Securities executed by the Corporation to the Trustee for
authentication, together with a Corporation Order for the authentication and
delivery of such Securities, and the Trustee in accordance with the Corporation
Order shall authenticate and deliver such Securities as in this Indenture
provided and not otherwise.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or be valid
or obligatory for any purpose, unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by the manual signature of one of its authorized
signatories, and such certificate upon any Security shall be conclusive
evidence, and the only evidence, that such Security has been duly authenticated
and delivered hereunder. Notwithstanding the foregoing, if any Security shall
have been authenticated and delivered hereunder but never issued and sold by the
Corporation, and the Corporation shall deliver such
27
<PAGE>
Security to the Trustee for cancellation as provided in Section 3.10, for all
purposes of this Indenture such Security shall be deemed never to have been
authenticated and delivered hereunder and shall never be entitled to the
benefits of this Indenture.
Section 3.4. Temporary Securities.
Pending the preparation of definitive Securities, the Corporation may execute,
and upon Corporation Order, the Trustee shall authenticate and deliver,
temporary Securities which are printed, lithographed, typewritten, mimeographed
or otherwise produced, in any denomination, substantially of the tenor of the
definitive Securities in lieu of which they are issued and with such appropriate
insertions, omissions, substitutions and other variations as the officers
executing such Securities may determine, as evidenced by their execution of such
Securities.
If temporary Securities are issued, the Corporation will cause definitive
Securities to be prepared without unreasonable delay. After the preparation of
definitive Securities, the temporary Securities shall be exchangeable for
definitive Securities upon surrender of the temporary Securities at the office
or agency of the Corporation designated for that purpose without charge to the
Holder. Upon surrender for cancellation of any one or more temporary Securities,
the Corporation shall execute and the Trustee shall authenticate and deliver in
exchange therefor one or more definitive Securities, of any authorized
denominations having the same Original Issue Date and Stated Maturity and having
the same terms as such temporary Securities. Until so exchanged, the temporary
Securities shall in all respects be entitled to the same benefits under this
Indenture as definitive Securities.
Section 3.5. Global Securities.
(a) Each Global Security issued under this Indenture shall be registered in
the name of the Depositary designated for such Global Security or a nominee
thereof and delivered to such Depositary or a nominee thereof or custodian
therefor, and each such Global Security shall constitute a single Security for
all purposes of this Indenture.
(b) Notwithstanding any other provision in this Indenture, a Global Security
is exchangeable in whole or in part for Securities registered, and transfer of
a Global Security in whole or in part may be registered, in the name of any
Person other than the Depositary for such Global Security or a nominee thereof
if (A) such Depositary (i) has notified the Corporation that it is unwilling or
unable to continue as Depositary for such Global Security or (ii) has ceased to
be a clearing agency registered under the Exchange Act at a time when the
Depositary is required to be so registered to act as Depositary, in either case
unless the Corporation has approved a successor Depositary within 90 days, (B)
there shall have occurred and be continuing an Event of Default, (C) the
Corporation executes and delivers to the Trustee a Corporation Order stating
that the Corporation elects to terminate the book-entry system through the
Depositary, or (D) pursuant to the following sentence. All or any portion of a
Global Security
28
<PAGE>
may be exchanged for a Security that has a like aggregate principal amount and
is not a Global Security, upon 20 days' written notice given to the Trustee by
or on behalf of the Depositary in accordance with customary procedures.
(c) If any Global Security is to be exchanged for other Securities or
cancelled in whole, it shall be surrendered by or on behalf of the Depositary or
its nominee to the Trustee, as Securities Registrar, for exchange or
cancellation as provided in this Article III. If any Global Security is to be
exchanged for other Securities or cancelled in part, or if another Security is
to be exchanged in whole or in part for a beneficial interest in any Global
Security, then either (i) such Global Security shall be so surrendered for
exchange or cancellation as provided in this Article III or (ii) the principal
amount thereof shall be reduced or increased by an amount equal to the portion
thereof to be so exchanged or cancelled, or equal to the principal amount of
such other Security to be so exchanged for a beneficial interest therein, as the
case may be, by means of an appropriate adjustment made on the records of the
Securities Registrar, whereupon the Trustee, in accordance with the Applicable
Procedures, shall instruct the Depositary or its authorized representative to
make a corresponding adjustment to its records. Upon any such surrender or
adjustment of a Global Security, the Trustee shall, subject to Section 3.5(b)
and as otherwise provided in this Article III, authenticate and deliver any
Securities issuable in exchange for such Global Security (or any portion
thereof) to or upon the order of, and registered in such names as may be
directed by, the Depositary or its authorized representative. Upon the request
of the Trustee in connection with the occurrence of any of the events specified
in Section 3.5(b), the Company shall promptly make available to the Trustee a
reasonable supply of Securities that are not in the form of Global Securities.
The Trustee shall be entitled to rely upon any order, direction or request of
the Depositary or its authorized representative which is given or made pursuant
to this Article III if such order, direction or request is given or made in
accordance with the Applicable Procedures.
(d) Every Security authenticated and delivered upon registration of transfer
of, or in exchange for or in lieu of, a Global Security or any portion thereof,
whether pursuant to this Section, Section 3.4, 3.7, 9.6 or 11.6 or otherwise,
shall be authenticated and delivered in the form of, and shall be, a Global
Security, unless such Security is registered in the name of a Person other than
the Depositary for such Global Security or a nominee thereof.
Section 3.6. Registration and Registration of Transfer and Exchange
Generally; Certain Transfers and Exchanges; Securities Act Legends.
(a) Registration and Registration of Transfer and Exchange Generally. The
----------------------------------------------------------------
Corporation shall cause to be kept at the Corporate Trust Office of the Trustee
a register in which, subject to such reasonable regulations as it may prescribe,
the Corporation shall provide for the registration of Securities and of
transfers of Securities. Such register is herein sometimes referred to as the
29
<PAGE>
"Securities Register". The Trustee is hereby appointed "Securities Registrar"
for the purpose of registering Securities and transfers of Securities as herein
provided.
Upon surrender for registration of transfer of any Security at the office or
agency of the Corporation designated for that purpose, the Corporation shall
execute, and the Trustee shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Securities of any
authorized denominations, of a like aggregate principal amount, of the same
Original Issue Date and Stated Maturity and having the same terms and bearing
such restrictive legends as may be required by this Indenture.
At the option of the Holder, Securities may be exchanged for other Securities
of any authorized denominations, of a like aggregate principal amount, of the
same Original Issue Date and Stated Maturity and having the same terms and
bearing such restrictive legends as may be required by this Indenture, upon
surrender of the Securities to be exchanged at such office or agency. Whenever
any securities are so surrendered for exchange, the Corporation shall execute,
and the Trustee shall authenticate and deliver, the Securities which the Holder
making the exchange is entitled to receive.
All Securities issued upon any transfer or exchange of Securities shall be the
valid obligations of the Corporation, evidencing the same indebtedness, and
entitled to the same benefits under this Indenture, as the Securities
surrendered upon such transfer or exchange.
Every Security presented or surrendered for transfer or exchange shall (if so
required by the Corporation or the Securities Registrar) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Corporation and the Securities Registrar, duly executed by the Holder thereof or
his attorney duly authorized in writing.
No service charge shall be made to a Holder for any transfer or exchange of
Securities, but the Corporation may require payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in connection with any
transfer or exchange of Securities.
Neither the Corporation nor the Trustee shall be required, pursuant to the
provisions of this Section, (a) to issue, transfer or exchange any Security
during a period beginning at the opening of business 15 days before the day of
mailing of a notice of for redemption of Securities pursuant to Article XI and
ending at the close of business on the day of mailing of such notice of
redemption or (b) to transfer or exchange any Security so selected for
redemption in whole or in part, except, in the case of any Security to be
redeemed in part, any portion thereof not to be redeemed.
(b) Certain Transfers and Exchanges. In the event Securities are distributed
-------------------------------
to Holders of Preferred Securities other than Riggs Capital in exchange therefor
in connection with a termination or liquidation of Riggs Capital, as
contemplated by Section 9.2 of the Trust Agreement, the restrictions upon
transfer and exchange of Preferred Securities set forth in
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Section 5.5(b) of the Trust Agreement shall apply to transfers and exchanges of
the Securities, mutatis mutandis, unless the Corporation determines that any
such restrictions are not required.
(c) Securities Act Legends. In the event Securities are distributed to
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Holders of Preferred Securities other than Riggs Capital in exchange therefor,
as contemplated by Section 9.2 of the Trust Agreement, the requirements for the
Securities Act Legends provided for in Section 5.5(c) of the Trust Agreement
shall apply to the Securities, mutatis mutandis, unless the Corporation
determines that any such Securities Act Legends are not required.
(d) The Trustee shall not be required to insure or verify compliance with
securities laws, including the Securities Act, Exchange Act and 1940 Act, in
connection with transfers and exchanges of the Securities.
(e) No Obligation of the Trustee.
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(i) The Trustee shall have no responsibility or obligation to any owner of
beneficial interest in a Global Security, a Participant in the Depositary or
other Person with respect to the accuracy of the records of the Depositary or
its nominee or of any Participant thereof, with respect to any ownership
interest in the Securities or with respect to the delivery to any Participant,
beneficial owner or other Person (other than the Depositary) of any notice
(including any notice of redemption) or the payment of any amount, under or
with respect to such Securities. All notices and communications to be given
to the Holders and all payments to be made to Holders under the Securities
shall be given or made only to or upon the order of the registered Holders
(which shall be the Depositary or its nominee in the case of a Global
Security). The rights of beneficial owners in any Global Security shall be
exercised only through the Depositary subject to the applicable rules and
procedures of the Depositary. The Trustee may conclusively rely and shall be
exercised only through the Depositary subject to the applicable rules and
procedures of the Depositary. The Trustee may conclusively rely and shall be
fully protected in relying upon information furnished by the Depositary or any
agent thereof with respect to its Participants and any beneficial owners.
(ii) The Trustee and Registrar shall have no obligation or duty to monitor,
determine or inquire as to compliance with any restrictions on transfer
imposed under this Indenture or under applicable law with respect to any
transfer of any interest in any Security (including any transfers between or
among Depositary Participants or owners of beneficial interests in any Global
Security) other than to require delivery of such certificates and other
documentation or evidence as are expressly required by, and to do so if and
when expressly required by, the terms of this Indenture, and to examine the
same to determine substantial compliance as to form with the express
requirements hereof.
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Section 3.7. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security is surrendered to the Trustee together with such
security or indemnity as may be required by the Corporation or the Trustee to
save each of them harmless, the Corporation shall execute and the Trustee shall
authenticate and deliver in exchange therefor a new Security of the same issue
of like tenor and principal amount, having the same Original Issue Date and
Stated Maturity, and bearing a number not contemporaneously outstanding.
If there shall be delivered to the Corporation and to the Trustee (i) evidence
to their satisfaction of the destruction, loss or theft of any Security, and
(ii) such security or indemnity as may be required by them to save each of them
harmless, then, in the absence of notice to the Corporation or the Trustee that
such Security has been acquired by a bona fide purchaser, the Corporation shall
execute and upon its request the Trustee shall authenticate and deliver, in lieu
of any such destroyed, lost or stolen Security, a new Security of like tenor and
principal amount, having the same Original Issue Date and Stated Maturity as
such destroyed, lost or stolen Security, and bearing a number not
contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has become or
is about to become due and payable, the Corporation in its discretion may,
instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the Corporation may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses (including
the fees and expenses of the Trustee) connected therewith.
Every new Security issued pursuant to this Section in lieu of any destroyed,
lost or stolen Security shall constitute an original additional contractual
obligation of the Corporation, whether or not the destroyed, lost or stolen
Security shall be at any time enforceable by anyone, and shall be entitled to
all the benefits of this Indenture equally and proportionately with any and all
other Securities duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to the extent
lawful) all other rights and remedies with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Securities.
Section 3.8. Payment of Interest; Interest Rights Preserved.
Interest on any Security which is payable, and is punctually paid or duly
provided for, on any Interest Payment Date, shall be paid to the Person in whose
name that Security (or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such interest in respect of the
Securities, except that, interest payable on the Stated Maturity of the
principal of a Security shall be paid to the Person to whom principal is paid.
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Any interest on any Security which is payable, but is not timely paid or duly
provided for, on any Interest Payment Date for the Securities (herein called
"Defaulted Interest"), shall forthwith cease to be payable to the registered
Holder on the relevant Regular Record Date by virtue of having been such Holder,
and such Defaulted Interest may be paid by the Corporation, at its election in
each case, as provided in Clause (1) or (2) below:
(1) The Corporation may elect to make payment of any Defaulted Interest to the
Persons in whose names the Securities in respect of which interest is in default
(or their respective Predecessor Securities) are registered at the close of
business on a Special Record Date for the payment of such Defaulted Interest,
which shall be fixed in the following manner. The Corporation shall notify the
Trustee in writing of the amount of Defaulted Interest proposed to be paid on
each Security and the date of the proposed payment, and at the same time the
Corporation shall deposit with the Trustee an amount of money equal to the
aggregate amount proposed to be paid in respect of such Defaulted Interest or
shall make arrangements satisfactory to the Trustee for such deposit prior to
the date of the proposed payment, such money when deposited to be held in trust
for the benefit of the Persons entitled to such Defaulted Interest as in this
Clause provided. Thereupon the Trustee shall fix a Special Record Date for the
payment of such Defaulted Interest which shall be not more than 15 days and not
less than 10 days prior to the date of the proposed payment and not less than 10
days after the receipt by the Trustee of the notice of the proposed payment. The
Trustee shall promptly notify the Corporation of such Special Record Date and,
in the name and at the expense of the Corporation, shall cause notice of the
proposed payment of such Defaulted Interest and the Special Record Date therefor
to be mailed, first class, postage prepaid, to each Holder of a Security at the
address of such Holder as it appears in the Securities Register not less than 10
days prior to such Special Record Date. The Trustee may, in its discretion, in
the name and at the expense of the Corporation, cause a similar notice to be
published at least once in a newspaper, customarily published in the English
language on each Business Day and of general circulation in the Borough of
Manhattan, The City of New York, but such publication shall not be a condition
precedent to the establishment of such Special Record Date. Notice of the
proposed payment of such Defaulted Interest and the Special Record Date therefor
having been mailed as aforesaid, such Defaulted Interest shall be paid to the
Persons in whose names the Securities (or their respective Predecessor
Securities) are registered on such Special Record Date and shall no longer be
payable pursuant to the following Clause (2).
(2) The Corporation may make payment of any Defaulted Interest in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities in respect of which interest is in default may be listed
and, upon such notice as may be required by such exchange (or by the Trustee if
the Securities are not listed), if, after notice given by the Corporation to the
Trustee of the proposed payment pursuant to this Clause, such payment shall be
deemed practicable by the Trustee. Any interest on any Security which is
deferred or extended pursuant to Section 3.12 shall not be Defaulted Interest
for the purposes of this Section 3.8.
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Subject to the foregoing provisions of this Section, each Security delivered
under this Indenture upon transfer of or in exchange for or in lieu of any other
Security shall carry the rights to interest accrued and unpaid, and to accrue,
which were carried by such other Security.
Section 3.9. Persons Deemed Owners.
The Corporation, the Trustee and any agent of the Corporation or the Trustee
may treat the Person in whose name any Security is registered as the owner of
such Security for the purpose of receiving payment of principal of (premium, if
any) and (subject to Section 3.8) any interest on such Security and for all
other purposes whatsoever, whether or not such Security be overdue, and neither
the Corporation, the Trustee nor any agent of the Corporation or the Trustee
shall be affected by notice to the contrary.
No holder of any beneficial interest in any Global Security held on its behalf
by a Depository shall have any rights under this Indenture with respect to such
Global Security, and such Depository may be treated by the Corporation, the
Trustee and any agent of the Corporation or the Trustee as the owner of such
Global Security for all purposes whatsoever. Notwithstanding the foregoing,
nothing herein shall prevent the Corporation, the Trustee or any agent of the
Corporation or the Trustee from giving effect to any written certification,
proxy or other authorization furnished by a Depository or impair, as between a
Depository and such holders of beneficial interests, the operation of customary
practices governing the exercise of the rights of the Depository (or its
nominee) as Holder of any Security.
Section 3.10. Cancellation.
All Securities surrendered for payment, redemption, transfer or exchange
shall, if surrendered to any Person other than the Trustee, be delivered to the
Trustee, and any such Securities and Securities surrendered directly to the
Trustee for any such purpose shall be promptly canceled by it. The Corporation
may at any time deliver to the Trustee for cancellation any Securities
previously authenticated and delivered hereunder which the Corporation may have
acquired in any manner whatsoever, and all Securities so delivered shall be
promptly canceled by the Trustee. No Securities shall be authenticated in lieu
of or in exchange for any Securities canceled as provided in this Section,
except as expressly permitted by this Indenture.
Section 3.11. Computation of Interest.
Interest on the Securities for any period less than a full interest period
shall be computed on the basis of a 360-day year of twelve 30-day months. The
amount of Distributions for any partial period shall be computed on the basis of
the number of days elapsed in a 360-day year of twelve 30-day months.
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Section 3.12. Deferrals of Interest Payment Dates.
So long as no Event of Default has occurred and is continuing, the Corporation
shall have the right, at any time during the term of the Securities, from time
to time to defer the payment of interest on the Securities for a period not
exceeding 10 consecutive semi-annual periods (each, an "Extension Period")
during which Extension Periods the Corporation shall have the right to make
partial payments of interest on any Interest Payment Date. No Extension Period
shall end on a date other than an Interest Payment Date. At the end of any such
Extension Period the Corporation shall pay all interest then accrued and unpaid
on the Securities (together with Additional Interest thereon, if any, at the
rate specified for the Securities to the extent permitted by applicable law);
provided, however, that no Extension Period shall extend beyond the Stated
Maturity of the principal of the Securities; provided, further, that during any
such Extension Period, the Corporation shall not, and shall not permit any
Subsidiary to, (i) declare or pay any dividends or distributions on, or redeem,
purchase, acquire or make a liquidation payment with respect to, any of the
Corporation's capital stock, or (ii) make any payment of principal, interest or
premium, if any, on or repay, repurchase or redeem any indebtedness securities
of the Corporation that rank pari passu in all respects with or junior in
interest to the Securities or make any guarantee payments with respect to any
guarantee by the Corporation of the debt securities of any Subsidiary of the
Corporation if such guarantee ranks pari passu with or junior in interest to the
securities (other than (a) dividends or distributions in Common Stock, (b) any
declaration of a dividend in connection with the implementation of a Rights
Plan, or the issuance of any Common Stock of any class or series of preferred
stock of the Corporation under any Rights Plan in the future or the redemption
or repurchase of any rights pursuant thereto, (c) payments under the Riggs
Capital Guarantee, and (d) purchases of Common Stock related to the issuance of
Common Stock or rights under any of the Corporation's benefit plans for its
directors, officers or employees). Prior to the termination of any such
Extension Period, the Corporation may further extend the interest payment
period, provided that no Extension Period shall exceed 10 consecutive semi-
annual periods or extend beyond the Stated Maturity of the principal of such
Securities. Upon the termination of any Extension Period and upon the payment of
all amounts then due on any Interest Payment Date, the Corporation may elect to
begin a new Extension Period, subject to the above requirements. No interest
shall be due and payable during an Extension Period, except at the end thereof.
The Corporation shall give the Property Trustee and the Trustee written notice
of its election to begin any such Extension Period at least one Business Day
prior to the earlier of (i) the date interest on the Securities would have been
payable except for the election to begin such Extension Period or (ii) the date
the Administrative Trustees are required to give notice to DTC or applicable
self-regulatory organization or to holders of the Preferred Securities as of the
record date or the date such Distributions are payable, but in any event not
less than one Business Day prior to such record date.
The Trustee, in the name of and at the expense of the Corporation, shall
promptly give notice of the Corporation's election to begin any such Extension
Period to the Holders of the Outstanding Securities.
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Section 3.13. Right of Set-Off.
So long as the Securities are held by Riggs Capital, notwithstanding anything
to the contrary herein, the Corporation shall have the right to set-off any
payment it is otherwise required to make thereunder in respect of any such
Security to the extent the Corporation has theretofore made, or is concurrently
on the date of such payment making, a payment under the Riggs Capital Guarantee
relating to such Security or under Section 5.8 hereof.
Section 3.14. Agreed Tax Treatment.
Each Security issued hereunder shall provide that the Corporation and, by its
acceptance of a Security or a beneficial interest therein, the Holder of, and
any Person that acquires a beneficial interest in, such Security agree that for
United States federal, state and local tax purposes it is intended that such
Security constitutes indebtedness.
Section 3.15. CUSIP Numbers.
The Corporation in issuing the Securities may use "CUSIP" numbers (if then
generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption or other related material as a convenience to Holders; provided
that any such notice or other related material may state that no representation
is made as to the correctness of such numbers either as printed on the
Securities or as contained in any notice of redemption or other related material
and that reliance may be placed only on the other identification numbers printed
on the Securities, and any such redemption shall not be affected by any defect
in or omission of such numbers. The Corporation will promptly notify the Trustee
of any changes in the CUSIP numbers.
ARTICLE IV
SATISFACTION AND DISCHARGE
Section 4.1. Satisfaction and Discharge of Indenture.
This Indenture shall, upon Corporation Request, cease to be of further effect
(except as to any surviving rights of registration of transfer or exchange of
Securities herein expressly provided for and as otherwise provided in this
Section 4.1) and the Trustee, on demand of and at the expense of the
Corporation, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(1) either
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(A) all Securities theretofore authenticated and delivered (other than (i)
Securities which have been destroyed, lost or stolen and which have been
replaced or paid as provided in Section 3.7 and (ii) Securities for whose
payment money has theretofore been deposited in trust or segregated and held in
trust by the Corporation and thereafter repaid to the Corporation or discharged
from such trust, as provided in Section 10.3) have been delivered to the Trustee
for cancellation; or
(B) all such Securities not theretofore delivered to the Trustee for
cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity within one
year of the date of deposit, or
(iii) are to be called for redemption within one year by the Trustee in
the name, and at the expense, of the Corporation,
and the Corporation, in the case of Clause (B) (i), (ii) or (iii) above,
has deposited or caused to be deposited with the Trustee as trust funds
in trust for such purpose an amount in the currency or currencies in
which the Securities are payable sufficient to pay and discharge the
entire indebtedness on such Securities not theretofore delivered to the
Trustee for cancellation, for principal (and premium, if any) and
interest (including any Additional Interest) to the date of such deposit
(in the case of Securities which have become due and payable) or to the
Stated Maturity or Redemption Date, as the case may be;
(2) the Corporation has paid or caused to be paid all other sums payable
hereunder by the Corporation; and
(3) the Corporation has delivered to the Trustee an Officers' Certificate and
an Opinion of Counsel each stating that all conditions precedent herein provided
for relating to the satisfaction and discharge of this Indenture have been
complied with.
Notwithstanding the satisfaction and discharge or termination of this Indenture,
or the earlier resignation or removal of the Trustee or any Authenticating
Agent, the obligations of the Corporation to the Trustee under Section 6.7, the
obligations of the Corporation to any Authenticating Agent under Section 6.14
and, if money shall have been deposited with the Trustee pursuant to subclause
(B) of clause (1) of this Section, the obligations of the Trustee under Section
4.2 and the last paragraph of Section 10.3 shall survive.
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Section 4.2. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 10.3, all money
deposited with the Trustee pursuant to Section 4.1 shall be held in trust and
applied by the Trustee, in accordance with the provisions of the Securities and
this Indenture, to the payment, either directly or through any Paying Agent
(including the Corporation acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium, if
any) and interest for the payment of which such money or obligations have been
deposited with or received by the Trustee.
ARTICLE V
REMEDIES
Section 5.1. Events of Default.
"Event of Default", wherever used herein with respect to the Securities, means
any one of the following events that has occurred and is continuing (whatever
the reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(1) failure to pay any interest upon any Security, including any Additional
Interest in respect thereof, when it becomes due and payable, and continuance of
such default for a period of 30 days (subject to the deferral of any Interest
Payment Date in the case of an Extension Period); or
(2) failure to pay the principal of (or premium, if any, on) any Security when
due, whether at maturity, upon redemption by declaration or otherwise; or
(3) failure to observe or perform, in any material respect, any covenant of
the Corporation in this Indenture (other than a covenant a default in the
performance of which or the breach of which is elsewhere in this Section
specifically dealt with), and continuance of such default or breach for a period
of 90 days after there has been given, by registered or certified mail, to the
Corporation by the Trustee or to the Corporation and the Trustee by the Holders
of at least 25% in principal amount of the Outstanding Securities a written
notice specifying such failure to observe or perform and requiring it to be
remedied; or
(4) the entry of a decree or order for relief in respect of the Corporation by
a court having jurisdiction in the premises in an involuntary case under federal
or state bankruptcy laws, as now or hereafter constituted, and the continuance
of any such decree or order unstayed and in effect for a period of 60
consecutive days; or
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(5) the commencement by the Corporation of a voluntary case under federal or
state bankruptcy laws, as now or hereafter constituted, or the consent by the
Corporation to the entry of a decree or order for relief in an involuntary case
under any such laws.
Section 5.2. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default (other than an Event of Default specified in Section
5.1(4) or 5.1(5)) with respect to the Securities at the time Outstanding occurs
and is continuing, then and in every such case the Trustee or the Holders of not
less than 25% in principal amount of the Outstanding Securities may declare the
principal amount of all the Securities to be due and payable immediately, by a
notice in writing to the Corporation (and to the Trustee if given by Holders),
provided that, so long as the Securities are held by Riggs Capital, if, upon an
Event of Default, the Trustee or the Holders of not less than 25% in principal
amount of the Outstanding Securities fail to declare the principal of all the
Securities to be immediately due and payable, the holders of at least 25% in
aggregate Liquidation Amount (as defined in the related Trust Agreement) of the
corresponding Preferred Securities then outstanding shall have such right by a
notice in writing to the Corporation and the Trustee; and upon any such
declaration such principal amount (or specified portion thereof) of and the
accrued interest (including any Additional Interest) on all the Securities shall
become immediately due and payable. Payment of principal (premium, if any) and
interest (including any Additional Interest) on such Securities shall remain
subordinated to the extent provided in Article XII notwithstanding that such
amount shall become immediately due and payable as herein provided. If an Event
of Default specified in Section 5.1(4) or 5.1(5) with respect to the Securities
at the time Outstanding occurs, the principal amount of all the Securities shall
automatically, and without any declaration or other action on the part of the
Trustee or any Holder, become immediately due and payable.
At any time after such a declaration of acceleration with respect to the
Securities has been made and before a judgment or decree for payment of the
money due has been obtained by the Trustee as hereinafter in this Article
provided, the Holders of a majority in principal amount of the Outstanding
Securities, by written notice to the Corporation and the Trustee, may rescind
and annul such declaration and its consequences if:
(1) the Corporation has paid or deposited with the Trustee a sum sufficient to
pay:
(A) all overdue installments of interest (including any Additional
Interest) on all the Securities,
(B) the principal of (and premium, if any, on) any Securities which have
become due otherwise than by such declaration of acceleration and interest
thereon at the rate borne by the Securities, and
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(C) all sums paid or advanced by the Trustee hereunder and the reasonable
compensation, expenses, fees, disbursements and advances of the Trustee, its
agents and counsel; and
(2) all Events of Default with respect to the Securities, other than the non-
payment of the principal of the Securities which has become due solely by such
acceleration, have been cured or waived as provided in Section 5.13.
In the case of Securities held by Riggs Capital, the holders of a majority in
aggregate Liquidation Amount (as defined in the related Trust Agreement) of the
related Preferred Securities issued by Riggs Capital shall also have the right
to rescind and annul such declaration and its consequences by written notice to
the Corporation and the Trustee, subject to the satisfaction of the conditions
set forth in Clauses (1) and (2) above of this Section 5.2.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
Section 5.3. Collection of Debt and Suits for Enforcement by Trustee.
The Corporation covenants that if:
(1) default is made in the payment of any installment of interest (including
any Additional Interest) on any Security when such interest becomes due and
payable and such default continues for a period of 30 days, or
(2) default is made in the payment of the principal of (and premium, if any,
on) any Security at the Maturity thereof,
the Corporation will, upon demand of the Trustee, pay to the Trustee, for the
benefit of the Holders of such Securities, the whole amount then due and payable
on such Securities for principal, (and premium, if any) and interest (including
any Additional Interest); and, in addition thereto, all amounts owing the
Trustee under Section 6.7.
If the Corporation fails to pay such amounts forthwith upon such demand, the
Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, and may
prosecute such proceeding to judgment or final decree, and may enforce the same
against the Corporation or any other obligor upon the Securities and collect the
moneys adjudged or decreed to be payable in the manner provided by law out of
the property of the Corporation or any other obligor upon the Securities,
wherever situated.
If an Event of Default with respect to the Securities occurs and is
continuing, the Trustee may in its discretion proceed to protect and enforce its
rights and the rights of the Holders of Securities by such appropriate judicial
proceedings as the Trustee shall deem most effectual to
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protect and enforce any such rights, whether for the specific enforcement of any
covenant or agreement in this Indenture or in aid of the exercise of any power
granted herein, or to enforce any other proper remedy.
Section 5.4. Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Corporation or any other obligor upon the
Securities or the property of the Corporation or of such other obligor or their
creditors,
(a) the Trustee (irrespective of whether the principal of the Securities shall
then be due and payable as therein expressed or by declaration or otherwise and
irrespective of whether the Trustee shall have made any demand on the
Corporation for the payment of overdue principal (and premium, if any) or
interest (including any Additional Interest)) shall be entitled and empowered,
by intervention in such proceeding or otherwise,
(i) to file and prove a claim for the whole amount of principal (and
premium, if any) and interest (including any Additional Interest) owing and
unpaid in respect to the Securities and to file such other papers or documents
as may be necessary or advisable and to take any and all actions as are
authorized under the Trust Indenture Act in order to have the claims of the
Holders and any predecessor to the Trustee under Section 6.7 allowed in any such
judicial proceedings; and
(ii) in particular, the Trustee shall be authorized to collect and receive
any moneys or other property payable or deliverable on any such claims and to
distribute the same in accordance with Section 5.6; and
(b) any custodian, receiver, assignee, trustee, liquidator, sequestrator (or
other similar official) in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Trustee for distribution in accordance
with Section 5.6, and in the event that the Trustee shall consent to the making
of such payments directly to the Holders, to pay to the Trustee any amount due
to it and any predecessor Trustee under Section 6.7.
Nothing herein contained shall be deemed to authorize the Trustee to authorize
or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof, or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding; provided, however,
that the Trustee may, on behalf of the Holders, vote for the election of a
trustee in bankruptcy or similar official and be a member of a creditors' or
other similar committee.
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Section 5.5. Trustee May Enforce Claims Without Possession of Securities.
All rights of action and claims under this Indenture or the Securities may be
prosecuted and enforced by the Trustee without the possession of any of the
Securities or the production thereof in any proceeding relating thereto, and any
such proceeding instituted by the Trustee shall be brought in its own name as
trustee of an express trust, and any recovery of judgment shall, after provision
for the payment of all the amounts owing the Trustee and any predecessor Trustee
under Section 6.7, its agents and counsel, be for the ratable benefit of the
Holders of the Securities in respect of which such judgment has been recovered.
Section 5.6. Application of Money Collected.
Any money or property collected or to be applied by the Trustee with respect
to the Securities pursuant to this Article shall be applied in the following
order, at the date or dates fixed by the Trustee and, in case of the
distribution of such money or property on account of principal (or premium, if
any) or interest (including any Additional Interest), upon presentation of the
Securities and the notation thereon of the payment if only partially paid and
upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee and any predecessor
Trustee;
SECOND: Subject to Article XII, to the payment of the amounts then due and
unpaid upon the Securities for principal (and premium, if any) and interest
(including any Additional Interest), in respect of which or for the benefit of
which such money has been collected, ratably, without preference or priority of
any kind, according to the amounts due and payable on the Securities for
principal (and premium, if any) and interest (including any Additional
Interest), respectively; and
THIRD: The balance, if any, to the Person or Persons entitled thereto.
Section 5.7. Limitation on Suits.
No Holder of Securities shall have any right to institute any proceeding,
judicial or otherwise, with respect to this Indenture or for the appointment of
a receiver, assignee, trustee, liquidator, sequestrator (or other similar
official) or for any other remedy hereunder, unless:
(1) such Holder has previously given written notice to the Trustee of a
continuing Event of Default with respect to the Securities;
(2) the Holders of not less than 25% in principal amount of the Outstanding
Securities shall have made written request to the Trustee to institute
proceedings in respect of such Event of Default in its own name as Trustee
hereunder;
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(3) such Holder or Holders have offered to the Trustee reasonable indemnity
against the costs, expenses and liabilities to be incurred in compliance with
such request;
(4) the Trustee for 60 days after its receipt of such notice, request and
offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been given to the
Trustee during such 60-day period by the Holders of a majority in principal
amount of the Outstanding Securities;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing itself of, any
provision of this Indenture to affect, disturb or prejudice the rights of any
other Holders of Securities, or to obtain or to seek to obtain priority or
preference over any other of such Holders or to enforce any right under this
Indenture, except in the manner herein provided and for the equal and ratable
benefit of all such Holders.
Section 5.8. Unconditional Right of Holders to Receive Principal, Premium
and Interest; Direct Action by Holders of Preferred Securities.
Notwithstanding any other provision in this Indenture, the Holder of any
Security shall have the right which is absolute and unconditional to receive
payment of the principal of (and premium, if any) and (subject to Section 3.8)
interest (including any Additional Interest) on such Security on the respective
Stated Maturities expressed in such Security (or, in the case of redemption, on
the Redemption Date) and to institute suit for the enforcement of any such
payment, and such right shall not be impaired without the consent of such
Holder. So long as the Securities are held by Riggs Capital, any holder of the
corresponding Preferred Securities issued by Riggs Capital shall have the right,
upon the occurrence of an Event of Default described in Section 5.1(1) or
5.1(2), to institute a suit directly against the Corporation for enforcement of
payment to such holder of principal of (premium, if any) and (subject to Section
3.8) interest (including any Additional Interest) on the Securities having a
principal amount equal to the aggregate Liquidation Amount (as defined in the
Trust Agreement) of such Preferred Securities held by such holder.
Section 5.9. Restoration of Rights and Remedies.
If the Trustee, any Holder or any holder of Preferred Securities has
instituted any proceeding to enforce any right or remedy under this Indenture
and such proceeding has been discontinued or abandoned for any reason, or has
been determined adversely to the Trustee, such Holder or such holder of
Preferred Securities, then and in every such case the Corporation, the Trustee,
the Holders and such holder of Preferred Securities shall, subject to any
determination in such proceeding, be restored severally and respectively to
their former positions hereunder, and
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thereafter all rights and remedies of the Trustee, the Holders and the holders
of Preferred Securities shall continue as though no such proceeding had been
instituted.
Section 5.10. Rights and Remedies Cumulative.
Except as otherwise provided in the last paragraph of Section 3.6, no right or
remedy herein conferred upon or reserved to the Trustee or to the Holders is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
Section 5.11. Delay or Omission Not Waiver.
No delay or omission of the Trustee, any Holder of any Security or any holder
of any Preferred Security to exercise any right or remedy accruing upon any
Event of Default shall impair any such right or remedy or constitute a waiver of
any such Event of Default or an acquiescence therein.
Every right and remedy given by this Article or by law to the Trustee or to
the Holders and the right and remedy given to the holders of Preferred
Securities by Section 5.8 may be exercised from time to time, and as often as
may be deemed expedient, by the Trustee, the Holders or the holders of Preferred
Securities, as the case may be.
Section 5.12. Control by Holders.
The Holders of a majority in principal amount of the Outstanding Securities
shall have the right to 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 Securities, provided that:
(1) such direction shall not be in conflict with any rule of law or with this
Indenture,
(2) the Trustee may take any other action deemed proper by the Trustee which
is not inconsistent with such direction, and
(3) subject to the provisions of Section 6.1, the Trustee shall have the right
to decline to follow such direction if a Responsible Officer or Officers of the
Trustee shall, in good faith, determine that the proceeding so directed would be
unjustly prejudicial to the Holders not joining in any such direction or would
involve the Trustee in personal liability.
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Section 5.13. Waiver of Past Defaults.
The Holders of not less than a majority in principal amount of the Outstanding
Securities and, in the case of any Securities held by Riggs Capital, the holders
of majority in aggregate Liquidation Amount (as defined in the related Trust
Agreement) of Preferred Securities issued by Riggs Capital, may waive any past
default hereunder and its consequences with respect to the Securities except a
default:
(1) in the payment of the principal of (or premium, if any) or interest
(including any Additional Interest) on any Security, or
(2) in respect of a covenant or provision hereof which under Article IX cannot
be modified or amended without the consent of the Holder of each Outstanding
Security of affected.
Any such waiver shall be deemed to be on behalf of the Holders of all the
Securities or, in the case of a waiver by holders of Preferred Securities issued
Riggs Capital by all holders of Preferred Securities issued by Riggs Capital.
Upon any such waiver, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
default or impair any right consequent thereon.
Section 5.14. Undertaking for Costs.
All parties to this Indenture agree, and each Holder of any Security by his
acceptance thereof shall be deemed to have agreed, that any court may in its
discretion require, in any suit for the enforcement of any right or remedy under
this Indenture, or in any suit against the Trustee for any action taken or
omitted by it as Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees and
expenses, against any party litigant in such suit, having due regard to the
merits and good faith of the claims or defenses made by such party litigant; but
the provisions of this Section shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Holder, or group of Holders, holding in
the aggregate more than 10% in principal amount of the Outstanding Securities,
or to any suit instituted by any Holder for the enforcement of the payment of
the principal of (or premium, if any) or interest (including any Additional
Interest) on any Security on or after the respective Stated Maturities expressed
in such Security.
Section 5.15. Waiver of Usury, Stay or Extension Laws.
The Corporation covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead, or in any manner whatsoever claim or
take the benefit or advantage of, any usury, stay or extension law wherever
enacted, now or at any time hereafter in force,
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which may affect the covenants or the performance of this Indenture; and the
Corporation (to the extent that it may lawfully do so) hereby expressly waives
all benefit or advantage of any such law, and covenants that it will not hinder,
delay or impede the execution of any power herein granted to the Trustee, but
will suffer and permit the execution of every such power as though no such law
had been enacted.
ARTICLE VI
THE TRUSTEE
Section 6.1. Certain Duties and Responsibilities.
(a) Except during the continuance of an Event of Default,
(1) the Trustee undertakes to perform such duties and only such duties as
are specifically set forth in this Indenture, and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may conclusively
rely, as to the truth of the statements and the correctness of the opinions
expressed therein, upon certificates or opinions furnished to the Trustee and
conforming to the requirements of this Indenture; but in the case of any such
certificates or opinions which by any provisions hereof are specifically
required to be furnished to the Trustee, the Trustee shall be under a duty to
examine the same to determine whether or not they conform to the requirements of
this Indenture.
(b) In case an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in their exercise, as a prudent person
would exercise or use under the circumstances in the conduct of his own affairs.
(c) No provision of this Indenture shall be construed to relieve the Trustee
from liability for its own negligent action, its own negligent failure to act,
or its own willful misconduct except that
(1) this Subsection shall not be construed to limit the effect of
Subsection (a) of this Section;
(2) the Trustee shall not be liable for any error of judgment made in good
faith by a Responsible Officer, unless it shall be proved that the Trustee was
negligent in ascertaining the pertinent facts; and
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(3) the Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in good faith in accordance with the direction of
Holders pursuant to Section 5.12 relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred upon the Trustee, under this Indenture with respect
to the Securities.
(d) No provision of this Indenture shall require the Trustee to expend or risk
its own funds or otherwise incur any financial liability in the performance of
any of its duties hereunder, or in the exercise of any of its rights or powers,
if there shall be reasonable grounds for believing that repayment of such funds
or adequate indemnity against such risk or liability is not reasonably assured
to it.
(e) Whether or not therein expressly so provided, every provision of this
Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section.
Section 6.2. Notice of Defaults.
Within 90 days after actual knowledge by a Responsible Officer of the Trustee
of the occurrence of any default hereunder with respect to the Securities, the
Trustee shall transmit by mail to all Holders of Securities, as their names and
addresses appear in the Securities Register, notice of such default, unless such
default shall have been cured or waived; provided, however, that, except in the
case of a default in the payment of the principal of (or premium, if any) or
interest (including any Additional Interest) on any Security, the Trustee shall
be protected in withholding such notice if and so long as the board of
directors, the executive committee or a trust committee of directors and/or
Responsible Officers of the Trustee in good faith determines that the
withholding of such notice is in the interests of the Holders of Securities; and
provided, further, that, in the case of any default of the character specified
in Section 5.1(3), no such notice to Holders of Securities shall be given until
at least 30 days after the occurrence thereof. For the purpose of this Section,
the term "default" means any event which is, or after notice or lapse of time or
both would become, an Event of Default with respect to the Securities.
Section 6.3. Certain Rights of Trustee.
Subject to the provisions of Section 6.1:
(a) the Trustee may rely conclusively and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
Security or other paper or document believed by it to be genuine and to have
been signed or presented by the proper party or parties;
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(b) any request or direction of the Corporation mentioned herein shall be
sufficiently evidenced by a Corporation Request or Corporation Order and any
resolution of the Board of Directors may be sufficiently evidenced by a Board
Resolution;
(c) whenever in the administration of this Indenture the Trustee shall deem it
desirable that a matter be proved or established prior to taking, suffering or
omitting any action hereunder, the Trustee (unless other evidence be herein
specifically prescribed) may, in the absence of bad faith on its part, rely
conclusively upon an Officers' Certificate;
(d) the Trustee may consult with counsel of its choice and the advice of such
counsel or any Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the rights or
powers vested in it by this Indenture at the request or direction of any of the
Holders pursuant to this Indenture, unless such Holders shall have offered to
the Trustee reasonable security or indemnity against the costs, expenses and
liabilities which might be incurred by it in compliance with such request or
direction;
(f) the Trustee shall not be bound to make any investigation into the facts or
matters stated in any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, indenture, Security or
other paper or document, but the Trustee in its discretion may make such inquiry
or investigation into such facts or matters as it may see fit, and, if the
Trustee shall determine to make such inquiry or investigation, it shall be
entitled to examine the books, records and premises of the Corporation,
personally or by agent or attorney;
(g) the Trustee may execute any of the trusts or powers hereunder or perform
any duties hereunder either directly or by or through agents or attorneys and
the Trustee shall not be responsible for any misconduct or negligence on the
part of any agent or attorney appointed with due care by it hereunder;
(h) the Trustee shall not be under any obligation to take any action that is
discretionary under the provisions of this Indenture;
(i) the Trustee shall not be charged with knowledge of any Event of Default
unless either (i) a Responsible Officer of the Trustee shall have actual
knowledge thereof or (2) the Trustee shall have received notice thereof in
accordance with Section 1.5(1) hereof from the Corporation or a Holder; and
(j) no permissive power or authority available to the Trustee shall be
construed as a duty.
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(k) the Trustee shall not be liable for any action taken, suffered or omitted
to be taken by it in good faith and reasonably believed by it to be authorized
or within the discretion or rights or powers conferred upon it by this
Indenture.
Section 6.4. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except the Trustee's
certificates of authentication, shall be taken as the statements of the
Corporation, and neither the Trustee nor any Authenticating Agent assumes any
responsibility for their correctness. The Trustee makes no representations as to
the validity or sufficiency of this Indenture or of the Securities. Neither the
Trustee nor any Authenticating Agent shall be accountable for the use or
application by the Corporation of the Securities or the proceeds thereof.
Section 6.5. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any Securities
Registrar or any other agent of the Corporation, in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to Sections
6.8 and 6.13, may otherwise deal with the Corporation with the same rights it
would have if it were not Trustee, Authenticating Agent, Paying Agent,
Securities Registrar or such other agent.
Section 6.6. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be segregated from other
funds except to the extent required by law. The Trustee shall be under no
liability for interest on any money received by it hereunder except as otherwise
agreed in writing with the Corporation.
Section 6.7. Compensation and Reimbursement.
The Corporation agrees
(1) to pay to the Trustee from time to time such compensation as shall be
agreed to in writing between the Corporation and the Trustee for all services
rendered by it hereunder in such amounts as the Corporation and the Trustee
shall agree from time to time (which compensation shall not be limited by any
provision of law in regard to the compensation of a trustee of an express
trust);
(2) to reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in accordance with
any provision of this Indenture (including the reasonable compensation and the
expenses and disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence or bad faith;
and
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(3) to indemnify each of the Trustee and any predecessor Trustee for, and to
hold it harmless against, any and all loss, liability, damage, claim or expense
(including the reasonable compensation and the expenses and disbursements of its
agents and counsel) incurred without negligence or bad faith, arising out of or
in connection with the acceptance or administration of this trust or the
performance of its duties hereunder, including the costs and expenses of
defending itself against any claim or liability in connection with the exercise
or performance of any of its powers or duties hereunder.
The obligations of the Corporation under this Section 6.7 shall survive the
termination of the Indenture or the earlier resignation or removal of the
Trustee.
To secure the Corporation's payment obligations in this Section, the
Corporation and the Holders agree that the Trustee shall have a lien prior to
the Securities on all money or property held or collected by the Trustee. Such
lien shall survive the satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an Event of Default
specified in Section 5.1(4) or (5) occurs, the expenses and the compensation for
the services are intended to constitute expenses of administration under the
Bankruptcy Reform Act of 1978 or any successor statute.
Section 6.8. Disqualification; Conflicting Interests.
The Trustee for the Securities issued hereunder shall be subject to the
provisions of Section 310(b) of the Trust Indenture Act. Nothing herein shall
prevent the Trustee from filing with the Commission the application referred to
in the second to last paragraph of said Section 310(b).
Section 6.9. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which shall be
(a) a corporation organized and doing business under the laws of the United
States of America or of any State or Territory or the District of Columbia,
authorized under such laws to exercise corporate trust powers and subject to
supervision or examination by federal, state, territorial or District of
Columbia authority, or
(b) a corporation or other Person organized and doing business under the laws
of a foreign government that is permitted to act as Trustee pursuant to a rule,
regulation or order of the Commission, authorized under such laws to exercise
corporate trust powers, and subject to supervision or examination by authority
of such foreign government or a political subdivision thereof substantially
equivalent to supervision or examination applicable to United States
institutional trustees,
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in either case having a combined capital and surplus of at least $50,000,000,
subject to supervision or examination by Federal or State authority. If such
corporation publishes reports of condition at least annually, pursuant to law or
to the requirements of the aforesaid supervising or examining authority, then,
for the purposes of this Section, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. If at any time the Trustee
shall cease to be eligible in accordance with the provisions of this Section, it
shall resign immediately in the manner and with the effect hereinafter specified
in this Article. Neither the Corporation nor any Person directly or indirectly
controlling, controlled by or under common control with the Corporation shall
serve as Trustee for the Securities issued hereunder.
Section 6.10. Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 6.11.
(b) The Trustee may resign at any time with respect to the Securities by
giving written notice thereof to the Corporation. If an instrument of acceptance
by a successor Trustee shall not have been delivered to the Trustee within 30
days after the giving of such notice of resignation, the resigning Trustee may
petition any court of competent jurisdiction for the appointment of a successor
Trustee with respect to the Securities.
(c) The Trustee may be removed at any time with respect to the Securities by
Act of the Holders of a majority in principal amount of the Outstanding
Securities, delivered to the Trustee and to the Corporation. If an instrument of
acceptance by a successor Trustee shall not have been delivered to the Trustee
within 30 days after such removal, the Trustee being removed may petition any
court of competent jurisdiction for appointment of a successor Trustee with
respect to the Securities.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 6.8 after written request
therefor by the Corporation or by any Holder who has been a bona fide Holder of
a Security for at least six months, or
(2) the Trustee shall cease to be eligible under Section 6.9 and shall fail to
resign after written request therefor by the Corporation or by any such Holder,
or
(3) the Trustee shall become incapable of acting or shall be adjudged a
bankrupt or insolvent or a receiver of the Trustee or of its property shall be
appointed or any public officer shall take charge or control of the Trustee or
of its property or affairs for the purpose of rehabilitation, conservation or
liquidation,
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then, in any such case, (i) the Corporation, acting pursuant to the authority of
a Board Resolution, may remove the Trustee with respect to the Securities, or
(ii) subject to Section 5.14, any Holder who has been a bona fide Holder of a
Security for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the removal
of the Trustee with respect to the Securities and the appointment of a successor
Trustee or Trustees.
(e) If the Trustee shall resign, be removed or become incapable of acting, or
if a vacancy shall occur in the office of Trustee for any cause with respect to
the Securities, the Corporation, by a Board Resolution, shall promptly appoint a
successor Trustee with respect to the Securities. If, within one year after such
resignation, removal or incapability, or the occurrence of such vacancy, a
successor Trustee with respect to the Securities shall be appointed by Act of
the Holders of a majority in principal amount of the Outstanding Securities
delivered to the Corporation and the retiring Trustee, the successor Trustee so
appointed shall, forthwith upon its acceptance of such appointment, become the
successor Trustee with respect to the Securities and supersede the successor
Trustee appointed by the Corporation. If no successor Trustee with respect to
the Securities shall have been so appointed by the Corporation or the Holders
and accepted appointment in the manner hereinafter provided, any Holder who has
been a bona fide Holder of a Security for at least six months may, subject to
Section 5.14, on behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the appointment of a successor Trustee
with respect to the Securities.
(f) The Corporation shall give notice of each resignation and each removal of
the Trustee with respect to the Securities and each appointment of a successor
Trustee with respect to the Securities by mailing written notice of such event
by first-class mail, postage prepaid, to the Holders of the Securities as their
names and addresses appear in the Securities Register. Each notice shall include
the name of the successor Trustee with respect to the Securities and the address
of its Corporate Trust Office.
Section 6.11. Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor Trustee with respect
to the Securities, every such successor Trustee so appointed shall execute,
acknowledge and deliver to the Corporation and to the retiring Trustee an
instrument accepting such appointment, and thereupon the resignation or removal
of the retiring Trustee shall become effective and such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee; but, on the request
of the Corporation or the successor Trustee, such retiring Trustee shall, upon
payment of its charges, execute and deliver an instrument transferring to such
successor Trustee all the rights, powers and trusts of the retiring Trustee and
shall duly assign, transfer and deliver to such successor Trustee all property
and money held by such retiring Trustee hereunder.
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(b) In case of the appointment hereunder of a successor Trustee with respect
to the Securities, the Corporation, the retiring Trustee and each successor
Trustee with respect to the Securities shall execute and deliver an instrument
in writing or an indenture supplemental hereto wherein each successor Trustee
shall accept such appointment and which (1) shall contain such provisions as
shall be necessary or desirable to transfer and confirm to, and to vest in, each
successor Trustee all the rights, powers, trusts and duties of the retiring
Trustee with respect to the Securities, (2) if the retiring Trustee is not
retiring with respect to all Securities, shall contain such provisions as shall
be deemed necessary or desirable to confirm that all the rights, powers, trusts
and duties of the retiring Trustee with respect to the Securities as to which
the retiring Trustee is not retiring shall continue to be vested in the retiring
Trustee, and (3) shall add to or change any of the provisions of this Indenture
as shall be necessary to provide for or facilitate the administration of the
trust hereunder by more than one Trustee, it being understood that nothing
herein or in such instrument in writing or supplemental indenture shall
constitute such Trustees co-trustees of the trust and that each such Trustee
shall be trustee of a trust hereunder separate and apart from any trust or
trusts hereunder administered by any other such Trustee; and upon the execution
and delivery of such instrument in writing or supplemental indenture the
resignation or removal of the retiring Trustee shall become effective to the
extent provided therein and each such successor Trustee, without any further
act, deed or conveyance, shall become vested with all the rights, powers,
trusts, and duties of the retiring Trustee with respect to the Securities; but,
on request of the Corporation or any successor Trustee, such retiring Trustee
shall duly assign, transfer and deliver to such successor Trustee all property
and money held by such retiring Trustee hereunder with respect to the Securities
to which the appointment of such successor Trustee relates.
(c) Upon request of any such successor Trustee, the Corporation shall execute
any and all instruments for more fully and certainly vesting in and confirming
to such successor Trustee all rights, powers and trusts referred to in paragraph
(a) or (b) of this Section, as the case may be.
(d) No successor Trustee shall accept its appointment unless at the time of
such acceptance such successor Trustee shall be eligible under this Article.
Section 6.12. Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have been authenticated,
but not delivered, by the Trustee then in office, any successor by merger,
conversion or consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated, and in case any
Securities shall not have been authenticated, any successor to the Trustee may
authenticate such Securities either in
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the name of any predecessor Trustee or in the name of such successor Trustee,
and in all cases the certificate of authentication shall have the full force
which it is provided anywhere in the Securities or in this Indenture that the
certificate of the Trustee shall have.
Section 6.13. Preferential Collection of Claims Against Corporation.
If and when the Trustee shall be or become a creditor of the Corporation (or
any other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Corporation (or any such other obligor).
Section 6.14. Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents with respect to the
Securities which shall be authorized to act on behalf of the Trustee to
authenticate the Securities issued upon original issue and upon exchange,
registration of transfer or partial redemption thereof or pursuant to Section
3.6, and Securities so authenticated shall be entitled to the benefits of this
Indenture and shall be valid and obligatory for all purposes as if authenticated
by the Trustee hereunder. Wherever reference is made in this Indenture to the
authentication and delivery of Securities by the Trustee or the Trustee's
certificate of authentication, such reference shall be deemed to include
authentication and delivery on behalf of the Trustee by an Authenticating Agent.
Each Authenticating Agent shall be acceptable to the Corporation and shall at
all times be a corporation organized and doing business under the laws of the
United States of America, or of any State or Territory or the District of
Columbia, authorized under such laws to act as Authenticating Agent, having a
combined capital and surplus of not less than $50,000,000 and subject to
supervision or examination by Federal or State authority. If such Authenticating
Agent publishes reports of condition at least annually, pursuant to law or to
the requirements of said supervising or examining authority, then for the
purposes of this Section the combined capital and surplus of such Authenticating
Agent shall be deemed to be its combined capital and surplus as set forth in its
most recent report of condition so published. If at any time an Authenticating
Agent shall cease to be eligible in accordance with the provisions of this
Section, such Authenticating Agent shall resign immediately in the manner and
with the effect specified in this Section.
Any corporation into which an Authenticating Agent may be merged or converted
or with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which such Authenticating Agent shall be
a party, or any corporation succeeding to all or substantially all of the
corporate trust business of an Authenticating Agent shall be the successor
Authenticating Agent hereunder, provided such corporation shall be otherwise
eligible under this Section, without the execution or filing of any paper or any
further act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Corporation. The Trustee may at any time
terminate the agency of an
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Authenticating Agent by giving written notice thereof to such Authenticating
Agent and to the Corporation. Upon receiving such a notice of resignation or
upon such a termination, or in case at any time such Authenticating Agent shall
cease to be eligible in accordance with the provisions of this Section, the
Trustee may appoint a successor Authenticating Agent which shall be acceptable
to the Corporation and shall give notice of such appointment in the manner
provided in Section 1.6 to all Holders of Securities with respect to which such
Authenticating Agent will serve. Any successor Authenticating Agent upon
acceptance of its appointment hereunder shall become vested with all the rights,
powers and duties of its predecessor hereunder, with like effect as if
originally named as an Authenticating Agent. No successor Authenticating Agent
shall be appointed unless eligible under the provision of this Section.
The Corporation agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section.
If an appointment with respect to the Securities is made pursuant to this
Section, the Securities may have endorsed thereon, in addition to the Trustee's
certificate of authentication, an alternative certificate of authentication in
the following form:
This is one of the Securities referred to in the within mentioned Indenture.
Dated:
The Bank of New York
As Trustee
By:________________________________
As Authenticating Agent
By:________________________________
Authorized Signatory
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ARTICLE VII
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND CORPORATION
Section 7.1. Corporation to Furnish Trustee Names and Addresses of Holders.
The Corporation will furnish or cause to be furnished to the Trustee:
(a) semi-annually, not more than 15 days after each Regular Record Date in
each year, a list, in such form as the Trustee may reasonably require, of the
names and addresses of the Holders as of such Regular Record Date, and
(b) at such other times as the Trustee may request in writing, within 30 days
after the receipt by the Corporation of any such request, a list of similar form
and content as of a date not more than 15 days prior to the time such list is
furnished,
excluding from any such list names and addresses received by the Trustee in its
capacity as Securities Registrar.
Section 7.2. Preservation of Information, Communications to Holders.
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 7.1 and the names and
addresses of Holders received by the Trustee in its capacity as Securities
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 7.1 upon receipt of a new list so furnished.
(b) The rights of Holders to communicate with other Holders with respect to
their rights under this Indenture or under the Securities, and the corresponding
rights and privileges of the Trustee, shall be as provided in the Trust
Indenture Act.
(c) Every Holder of Securities, by receiving and holding the same, agrees with
the Corporation and the Trustee that neither the Corporation nor the Trustee nor
any agent of either of them shall be held accountable by reason of the
disclosure of information as to the names and addresses of the Holders made
pursuant to the Trust Indenture Act.
Section 7.3. Reports by Trustee.
(a) The Trustee shall transmit to Holders such reports concerning the Trustee
and its actions under this Indenture as may be required pursuant to the Trust
Indenture Act, at the times and in the manner provided pursuant thereto.
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(b) Reports so required to be transmitted at stated intervals of not more than
12 months shall be transmitted no later than 60 days after December 31 in each
calendar year, commencing 60 days after the first December 31 after the first
issuance of Securities under this Indenture.
(c) A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Trustee with each securities exchange upon which any
Securities are listed and also with the Commission. The Corporation will
promptly notify the Trustee when any Securities are listed on any securities
exchange.
Section 7.4. Reports by Corporation.
The Corporation shall file with the Trustee and with the Commission, and
transmit to Holders, such information, documents and other reports, and such
summaries thereof, as may be required pursuant to the Trust Indenture Act at the
times and in the manner provided in the Trust Indenture Act; provided that any
such information, documents or reports required to be filed with the Commission
pursuant to Section 13 or Section 15(d) of the Exchange Act shall be filed with
the Trustee within 15 days after the same is required to be filed with the
Commission. Notwithstanding that the Corporation may not be required to remain
subject to the reporting requirements of Section 13 or 15(d) of the Exchange
Act, the Corporation shall continue to file with the Commission and provide the
Trustee with the annual reports and the information, documents and other reports
which are specified in Sections 13 and 15(d) of the Exchange Act. The
Corporation also shall comply with the other provisions of Trust Indenture Act
Section 314(a).
ARTICLE VIII
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
Section 8.1. Corporation May Consolidate, Etc., Only on Certain Terms.
The Corporation shall not consolidate with or merge into any other Person or
convey, transfer or lease its properties and assets substantially as an entirety
to any Person, and no Person shall consolidate with or merge into the
Corporation or convey, transfer or lease its properties and assets substantially
as an entirety to the Corporation, unless:
(1) in case the Corporation shall consolidate with or merge into another
Person or convey, transfer or lease its properties and assets substantially as
an entirety to any Person, the corporation formed by such consolidation or into
which the Corporation is merged or the Person which acquires by conveyance or
transfer, or which leases, the properties and assets of the Corporation
substantially as an entirety shall be a corporation, partnership or trust
organized and existing under the laws of the United States of America or any
State or the District of Columbia and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the
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Trustee, in form satisfactory to the Trustee, the due and punctual payment of
the principal of (and premium, if any) and interest (including any Additional
Interest) on all the Securities and the performance of every covenant of this
Indenture on the part of the Corporation to be performed or observed;
(2) immediately after giving effect to such transaction, no Event of Default,
and no event which, after notice or lapse of time, or both, would become an
Event of Default, shall have happened and be continuing;
(3) So long as the Securities are held by Riggs Capital, such consolidation,
merger, conveyance, transfer or lease is permitted under the Trust Agreement and
Riggs Capital Guarantee and does not give rise to any breach or violation of the
Trust Agreement or Riggs Capital Guarantee; and
(4) the Corporation has delivered to the Trustee an Officers' Certificate and
an Opinion of Counsel, each stating that such consolidation, merger, conveyance,
transfer or lease and any such supplemental indenture comply with this Article
and that all conditions precedent herein provided for relating to such
transaction have been complied with; and the Trustee, subject to Section 6.1,
may rely upon such Officers' Certificate and Opinion of Counsel as conclusive
evidence that such transaction complies with this Section 8.1.
Section 8.2. Successor Corporation Substituted.
Upon any consolidation or merger by the Corporation with or into any other
Person, or any conveyance, transfer or lease by the Corporation of its
properties and assets substantially as an entirety to any Person in accordance
with Section 8.1, the successor corporation formed by such consolidation or into
which the Corporation is merged or to which such conveyance, transfer or lease
is made shall succeed to, and be substituted for, and may exercise every right
and power of, the Corporation under this Indenture with the same effect as if
such successor Person had been named as the Corporation herein; and in the event
of any such conveyance, transfer or lease the Corporation shall be discharged
from all obligations and covenants under the Indenture and the Securities and
may be dissolved and liquidated.
Such successor Person may cause to be signed, and may issue either in its own
name or in the name of the Corporation, any or all of the Securities issuable
hereunder which theretofore shall not have been signed by the Corporation and
delivered to the Trustee; and, upon the written order of such successor Person
instead of the Corporation and subject to all the terms, conditions and
limitations in this Indenture prescribed, the Trustee shall authenticate and
shall deliver any Securities which previously shall have been signed and
delivered by the officers of the Corporation to the Trustee for authentication
pursuant to such provisions and any Securities which such successor Person
thereafter shall cause to be signed and delivered to the Trustee on its behalf
for the purpose pursuant to such provisions. All the Securities so issued shall
in all respects have the same legal rank and benefit under this Indenture as the
Securities theretofore
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or thereafter issued in accordance with the terms of this Indenture as though
all of such Securities had been issued at the date of the execution hereof.
In case of any such consolidation, merger, sale, conveyance or lease, such
changes in phraseology and form may be made in the Securities thereafter to be
issued as may be appropriate.
ARTICLE IX
SUPPLEMENTAL INDENTURES
Section 9.1. Supplemental Indentures without Consent of Holders.
Without the consent of any Holders, the Corporation, when authorized by a
Board Resolution, and the Trustee, at any time and from time to time, may enter
into one or more indentures supplemental hereto, in form satisfactory to the
Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the Corporation, and the
assumption by any such successor of the covenants of the Corporation herein and
in the Securities contained; or
(2) to convey, transfer, assign, mortgage or pledge any property to or with
the Trustee or to surrender any right or power herein conferred upon the
Corporation; or
(3) to add to the covenants of the Corporation for the benefit of the Holders
of the Securities or to surrender any right or power herein conferred upon the
Corporation; or
(4) to add any additional Events of Default for the benefit of the Holders of
the Securities; or
(5) to change or eliminate any of the provisions of this Indenture, provided
that any such change or elimination (a) shall become effective only when there
is no Security Outstanding created prior to the execution of such supplemental
indenture which is entitled to the benefit of such provision or (b) shall not
apply to any Outstanding Securities; or
(6) to cure any ambiguity, to correct or supplement any provision herein which
may be defective or inconsistent with any other provision herein, or to make any
other provisions with respect to matters or questions arising under this
Indenture, provided that such action pursuant to this clause (6) shall not
adversely affect the interest of the Holders of the Securities in any material
respect or,for so long as the Preferred Securities shall remain outstanding, the
holders of such Preferred Securities; or
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(7) to evidence and provide for the acceptance of appointment hereunder by a
successor Trustee with respect to the Securities and to add to or change any of
the provisions of this Indenture as shall be necessary to provide for or
facilitate the administration of the trusts hereunder by more than one Trustee,
pursuant to the requirements of Section 6.11(b); or
(8) to comply with the requirements of the Commission in order to effect or
maintain the qualification of this Indenture under the Trust Indenture Act.
Section 9.2. Supplemental Indentures with Consent of Holders.
With the consent of the Holders of not less than a majority in principal
amount of the Outstanding Securities affected by such supplemental indenture, by
Act of said Holders delivered to the Corporation and the Trustee, the
Corporation, when authorized by a Board Resolution, and the Trustee may enter
into an indenture or indentures supplemental hereto for the purpose of adding
any provisions to or changing in any manner or eliminating any of the provisions
of this Indenture or of modifying in any manner the rights of the Holders of
Securities under this Indenture; provided, however, that no such supplemental
indenture shall, without the consent of the Holder of each Outstanding Security
affected thereby,
(1) except to the extent permitted by Section 3.11 with respect to the
deferral of the payment of interest on the Securities, change the Stated
Maturity of the principal of, or any installment of interest (including any
Additional Interest) on, the Securities, or reduce the principal amount thereof
or the rate of interest thereon or reduce any premium payable upon the
redemption thereof, or change the place of payment where, or the coin or
currency in which, the Securities or interest thereon is payable, or impair the
right to institute suit for the enforcement of any such payment on or after the
Stated Maturity thereof (or, in the case of redemption, on or after the
Redemption Date), or
(2) reduce the percentage in principal amount of the Outstanding Securities,
the consent of whose Holders is required for any such supplemental indenture, or
the consent of whose Holders is required for any waiver (of compliance with
certain provisions of this Indenture or certain defaults hereunder and their
consequences) provided for in this Indenture, or
(3) modify any of the provisions of this Section, Section 5.13 or Section
10.5, except to increase any such percentage or to provide that certain other
provisions of this Indenture cannot be modified or waived without the consent of
the Holder of each Security affected thereby;
(4) modify the provisions of Article XII of this Indenture with respect to the
subordination of outstanding Securities in a manner adverse to the Holders
thereof;
provided, further, that, so long as the Preferred Securities remain outstanding,
(i) no such amendment shall be made that adversely affects the holders of such
Preferred Securities in any material respect, and no termination of this
Indenture shall occur, and no waiver of any Event
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of Default or compliance with any covenant under this Indenture shall be
effective, without the prior consent of the holders of at least a majority of
the aggregate Liquidation Amount of such Preferred Securities then outstanding
unless and until the principal (and premium, if any) of the Securities and all
accrued and, subject to Section 3.8, unpaid interest (including any Additional
Interest) thereon have been paid in full and (ii) no amendment shall be made to
Section 5.8 of this Indenture that would impair the rights of the holders of
Preferred Securities provided therein without the prior consent of the holders
of each Preferred Security then outstanding unless and until the principal (and
premium, if any) of the Securities and all accrued and (subject to Section 3.8)
unpaid interest (including any Additional Interest) thereon have been paid in
full.
It shall not be necessary for any Act of Holders under this Section to approve
the particular form of any proposed supplemental indenture, but it shall be
sufficient if such Act shall approve the substance thereof.
Section 9.3. Execution of Supplemental Indentures.
In executing or accepting the modifications thereby of the trust created by
this Indenture, the Trustee shall be entitled to receive, and (subject to
Section 6.1) shall be fully protected in relying upon, an Officers' Certificate
and an Opinion of Counsel stating that the execution of such supplemental
indenture is authorized or permitted by this Indenture, and that all conditions
precedent have been complied with. The Trustee may, but shall not be obligated
to, enter into any such supplemental indenture which affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise or that may
subject it to any liability.
Section 9.4. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article, this
Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
Section 9.5. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall conform
to the requirements of the Trust Indenture Act as then in effect.
Section 9.6. Reference in Securities to Supplemental Indentures.
Securities authenticated and delivered after the execution of any supplemental
indenture pursuant to this Article may, and shall if required by the
Corporation, bear a notation in form approved by the Corporation as to any
matter provided for in such supplemental indenture. If the Corporation shall so
determine, new Securities so modified as to conform, in the opinion of the
Corporation, to any such supplemental indenture may be prepared and executed by
the
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Corporation and authenticated and delivered by the Trustee in exchange for the
Outstanding Securities.
ARTICLE X
COVENANTS
Section 10.1. Payment of Principal, Premium and Interest.
The Corporation covenants and agrees that it will duly and punctually pay the
principal of (and premium, if any) and interest (including any Additional
Interest) on the Securities in accordance with the terms of such Securities and
this Indenture.
Section 10.2. Maintenance of Office or Agency.
The Corporation will maintain in the Place of Payment for the Securities, an
office or agency where the Securities may be presented or surrendered for
payment and an office or agency where the Securities may be surrendered for
transfer or exchange and where notices and demands to or upon the Corporation in
respect of the Securities and this Indenture may be served. The Corporation
initially appoints the Trustee, acting through its Corporate Trust Office, as
its agent for said purposes. The Corporation will give prompt written notice to
the Trustee of any change in the location of any such office or agency. If at
any time the Corporation shall fail to maintain such office or agency or shall
fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee, and the Corporation hereby appoints the Trustee as its
agent to receive all such presentations, surrenders, notices and demands.
The Corporation may also from time to time designate one or more other offices
or agencies where the Securities may be presented or surrendered for any or all
of such purposes, and may from time to time rescind such designations; provided,
however, that no such designation or rescission shall in any manner relieve the
Corporation of its obligation to maintain an office or agency in the Place of
Payment for the Securities for such purposes. The Corporation will give prompt
written notice to the Trustee of any such designation and any change in the
location of any such office or agency.
Section 10.3. Money for Security Payments to be Held in Trust.
If the Corporation shall at any time act as its own Paying Agent with respect
to the Securities, it will, on or before each due date of the principal of (and
premium, if any) or interest on any of the Securities, segregate and hold in
trust for the benefit of the Persons entitled thereto a sum sufficient to pay
the principal (and premium, if any) or interest so
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becoming due until such sums shall be paid to such Persons or otherwise disposed
of as herein provided, and will promptly notify the Trustee of its failure so to
act.
Whenever the Corporation shall have one or more Paying Agents, it will, prior
to 10:00 a.m. New York City time on each due date of the principal of and
premium if any or interest on any Securities, deposit with a Paying Agent a sum
sufficient to pay the principal (and premium, if any) or interest so becoming
due, such sum to be held in trust for the benefit of the Persons entitled to
such principal and premium (if any) or interest, and (unless such Paying Agent
is the Trustee) the Corporation will promptly notify the Trustee of its failure
so to act.
The Corporation will cause each Paying Agent other than the Trustee to execute
and deliver to the Trustee an instrument in which such Paying Agent shall agree
with the Trustee, subject to the provisions of this Section, that such Paying
Agent will:
(1) hold all sums held by it for the payment of the principal of (and premium,
if any) or interest on Securities in trust for the benefit of the Persons
entitled thereto until such sums shall be paid to such Persons or otherwise
disposed of as herein provided;
(2) give the Trustee notice of any default by the Corporation (or any other
obligor upon the Securities) in the making of any payment of principal (and
premium, if any) or interest;
(3) at any time during the continuance of any such default, upon the written
request of the Trustee, forthwith pay to the Trustee all sums so held in trust
by such Paying Agent; and
(4) comply with the provisions of the Trust Indenture Act applicable to it as
a Paying Agent.
The Corporation may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, pay, or by Corporation
Order direct any Paying Agent to pay, to the Trustee all sums held in trust by
the Corporation or such Paying Agent, such sums to be held by the Trustee upon
the same trusts as those upon which such sums were held by the Corporation or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.
Any money deposited with the Trustee or any Paying Agent, or then held by the
Corporation, in trust for the payment of the principal of (and premium, if any)
or interest on any Security and remaining unclaimed for two years after such
principal (and premium, if any) or interest has become due and payable shall be
paid on Corporation Request to the Corporation, or (if then held by the
Corporation) shall (unless otherwise required by mandatory provision of
applicable escheat or abandoned or unclaimed property law) be discharged from
such trust; and the Holder of such Security shall thereafter, as an unsecured
general creditor, look only to the Corporation for payment thereof, and all
liability of the Trustee or such Paying Agent with respect to such trust money,
and all liability of the Corporation as trustee thereof, shall
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thereupon cease; provided, however, that the Trustee or such Paying Agent,
before being required to make any such repayment, may at the expense of the
Corporation cause to be published once, in a newspaper published in the English
language, customarily published on each Business Day and of general circulation
in the Borough of Manhattan, The City of New York, notice that such money
remains unclaimed and that, after a date specified therein, which shall not be
less than 30 days from the date of such publication, any unclaimed balance of
such money then remaining will be repaid to the Corporation.
Section 10.4. Statement as to Compliance.
The Corporation shall deliver to the Trustee, within 120 days after the end of
each fiscal year of the Corporation ending after the date hereof, an Officers'
Certificate executed by the principal executive officer, principal financial
officer or principal accounting officer of the Corporation covering the
preceding calendar year, stating whether or not to the best knowledge of the
signers thereof the Corporation is in default in the performance, observance or
fulfillment of or compliance with any of the terms, provisions, covenants and
conditions of this Indenture, and if the Corporation shall be in default,
specifying all such defaults and the nature and status thereof of which they may
have knowledge. For the purpose of this Section 10.4, compliance shall be
determined without regard to any grace period (other than an Extension Period)
or requirement of notice provided pursuant to the terms of this Indenture.
Section 10.5. Waiver of Certain Covenants.
The Corporation may omit in any particular instance to comply with any
covenant or condition provided pursuant to Section 9.1(3) with respect to the
Securities, if before or after the time for such compliance the Holders of at
least a majority in principal amount of the Outstanding Securities shall, by Act
of such Holders, either waive such compliance in such instance or generally
waive compliance with such covenant or condition, but no such waiver shall
extend to or affect such covenant or condition except to the extent so expressly
waived, and, until such waiver shall become effective, the obligations of the
Corporation in respect of any such covenant or condition shall remain in full
force and effect.
Section 10.6. Additional Sums.
In the case of the Securities issued to Riggs Capital, so long as no Event of
Default has occurred and is continuing, in the event that (i) Riggs Capital is
the Holder of all of the Outstanding Securities and (ii) a Tax Event in respect
of Riggs Capital shall have occurred and be continuing and (iii) the Company
shall not have (A) redeemed the Securities pursuant to Section 10.7(b) or (B)
terminated such Trust pursuant to Section 9.2(b) of the Trust Agreement, the
Corporation shall pay to Riggs Capital (and its permitted successors or assigns
under the related Trust Agreement) as Holder of the Securities for so long as
Riggs Capital (or its permitted successor or assignee) is the registered holder
of any Securities, such additional sums as may be necessary in order that the
amount of Distributions (including any Additional Amounts
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(as defined in such Trust Agreement)) paid by Riggs Capital on the related
Preferred Securities and Common Securities that at any time remain outstanding
in accordance with the terms thereof shall not be reduced as a result of any
Additional Taxes (the "Additional Sums"). Whenever in this Indenture or the
Securities there is a reference in any context to the payment of principal of
(or premium, if any) or interest on the Securities, such mention shall be deemed
to include mention of the payments of the Additional Sums provided for in this
paragraph to the extent that, in such context, Additional Sums are, were or
would be payable in respect thereof pursuant to the provisions of this paragraph
and express mention of the payment of Additional Sums (if applicable) in any
provisions hereof shall not be construed as excluding Additional Sums in those
provisions hereof where such express mention is not made.
Section 10.7. Additional Covenants.
The Corporation covenants and agrees with each Holder of Securities that it
shall not, and it shall not permit any Subsidiary of the Corporation to, (a)
declare or pay any dividends or distributions on, or redeem, purchase, acquire
or make a liquidation payment with respect to, any of the Corporation's capital
stock, or (b) make any payment of principal of or interest or premium, if any,
on or repay, repurchase or redeem any indebtedness securities of the Corporation
that rank pari passu with or junior in interest to the Securities or (c) make
any guarantee payments with respect to any guarantee by the Corporation of
indebtedness securities of any subsidiary of the Corporation if such guarantee
ranks pari passu with or junior in interest to the Securities (other than (a)
dividends or distributions in Common Stock of the Corporation, (b) any
declaration of a dividend in connection with the implementation of a Rights
Plan, the issuance of any Common Stock of any class or series of preferred stock
of the Corporation under any Rights Plan in the future or the redemption or
repurchase of any such rights pursuant thereto, (c) payments under the Riggs
Capital Guarantee, and (d) purchases of Common Stock related to the issuance of
Common Stock or rights under any of the Corporation's benefit plans for its
directors, officers or employees) if at such time (i) there shall have occurred
any event of which the Corporation has actual knowledge that (A) with the giving
of notice or the lapse of time, or both, would constitute an Event of Default
with respect to the Securities and (B) in respect of which the Corporation shall
not have taken reasonable steps to cure, (ii) if the Securities are held by
Riggs Capital, the Corporation shall be in default with respect to its payment
of any obligations under the Riggs Capital Guarantee relating to the Preferred
Securities issued by Riggs Capital or (iii) the Corporation shall have given
notice of its election to begin an Extension Period with respect to the
Securities as provided herein and shall not have rescinded such notice, or such
Extension Period, or any extension thereof, shall be continuing.
The Corporation also covenants with each Holder of the Securities issued to
Riggs Capital (i) to maintain directly or indirectly 100% ownership of the
Common Securities of Riggs Capital; provided, however, that any permitted
successor of the Corporation hereunder may succeed to the Corporation's
ownership of such Common Securities, (ii) as holder of the Common Securities not
to voluntarily terminate, wind-up or liquidate Riggs Capital, if then required
under applicable capital guidelines or policies, and (a) in connection with a
distribution
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of the Securities to the holders of Preferred Securities in liquidation of Riggs
Capital or (b) in connection with certain mergers, consolidations or
amalgamations permitted by the related Trust Agreement and (iii) to use its
reasonable efforts, consistent with the terms and provisions of such Trust
Agreement, to cause Riggs Capital to remain classified as a grantor trust and
not an association taxable as a corporation for United States federal income tax
purposes.
ARTICLE XI
REDEMPTION OF SECURITIES
Section 11.1. Right of Redemption.
The Corporation, at its option, may redeem the Securities (i) on or after
December 31, 2006 in whole at any time or in part from time to time, subject to
the Corporation having received prior approval of the Federal Reserve if then
required under applicable capital guidelines or policies or (ii) at any time
prior to December 31, 2006 upon the occurrence and during the continuation of a
Tax Event or Capital Treatment Event, in whole (but not in part) at any time
within 90 days following the occurrence of such Tax Event or Capital Treatment
Event, in each case at a Redemption Price specified in the form of Security set
forth in Section 2.1.
Redemption of the Securities as permitted or required pursuant to this
Indenture shall be made in accordance with such form of Security and this
Article; provided, however, that if any provision of the form of Security shall
conflict with any provision of this Article, the provision of the form of
Security shall govern. Each Security shall be subject to partial redemption only
in the amount equal to $1,000 or integral multiples of $1,000 in excess thereof.
Section 11.2. Election to Redeem; Notice to Trustee.
The election of the Corporation to redeem any Securities shall be evidenced by
or pursuant to a Board Resolution. In case of any redemption at the election of
the Corporation of any of the Securities, the Corporation shall, not less than
30 nor more than 60 days prior to the Redemption Date (unless a shorter notice
shall be satisfactory to the Trustee), notify the Trustee and, in the case of
Securities held by Riggs Capital, the related Property Trustee of such date and
of the principal amount of the Securities to be redeemed and provide the
additional information required to be included in the notice or notices
contemplated by Section 11.4. In the case of any redemption of Securities prior
to the expiration of any restriction on such redemption provided in the terms of
such Securities, the Corporation shall furnish the Trustee with an Officers'
Certificate and an Opinion of Counsel evidencing compliance with such
restriction.
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Section 11.3. Selection of Securities to be Redeemed.
If less than all the Securities are to be redeemed, the particular Securities
to be redeemed shall be selected not more than 60 days prior to the Redemption
Date by the Trustee, from the Outstanding Securities not previously called for
redemption, by lot or such other method as the Trustee shall deem fair and
appropriate and which may provide for the selection for redemption of a portion
of the principal amount of any Security, provided that the unredeemed portion of
the principal amount of any Security shall be in an authorized denomination
(which shall not be less than the minimum authorized denomination) for such
Security.
The Trustee shall promptly notify the Corporation in writing of the Securities
selected for partial redemption and the principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise requires, all
provisions relating to the redemption of Securities shall relate, in the case of
any Security redeemed or to be redeemed only in part, to the portion of the
principal amount of such Security which has been or is to be redeemed. If the
Corporation shall so direct, Securities registered in the name of the
Corporation, any Affiliate or any Subsidiary thereof shall not be included in
the Securities selected for redemption.
Section 11.4. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage prepaid,
mailed not later than the thirtieth day, and not earlier than the sixtieth day,
prior to the Redemption Date, to each Holder of Securities to be redeemed, at
the address of such Holder as it appears in the Securities Register.
With respect to Securities to be redeemed, each notice of redemption shall
state:
(a) the Redemption Date;
(b) the Redemption Price or if the Redemption Price cannot be calculated prior
to the time the notice is required to be sent, the estimate of the Redemption
Price provided pursuant to the Indenture together with a statement that it is an
estimate and that the actual Redemption Price will be calculated on the third
Business Day prior to the Redemption Date (if such an estimate of the Redemption
Price is given, a subsequent notice shall be given as set forth above setting
forth the Redemption Price promptly following the calculation thereof);
(c) if less than all Outstanding Securities are to be redeemed, the
identification (and, in the case of partial redemption, the respective principal
amounts) of the particular Securities to be redeemed;
(d) that on the Redemption Date, the Redemption Price will become due and
payable upon each such Security or portion thereof, and that interest thereon,
if any, shall cease to accrue on and after said date;
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(e) the place or places where such Securities are to be surrendered for
payment of the Redemption Price; and
(f) such other provisions as may be required in respect of the terms of the
Securities.
Notice of redemption of the Securities to be redeemed at the election of the
Corporation shall be given by the Corporation or, at the Corporation's request,
by the Trustee in the name and at the expense of the Corporation and shall not
be irrevocable. The notice if mailed in the manner herein provided shall be
conclusively presumed to have been duly given, whether or not the Holder
receives such notice. In any case, a failure to give such notice by mail or any
defect in the notice to the Holder of any Security designated for redemption as
a whole or in part shall not affect the validity of the proceedings for the
redemption of any other Security.
Section 11.5. Deposit of Redemption Price.
Prior to 10:00 a.m. New York City time on the Redemption Date specified in the
notice of redemption given as provided in Section 11.4, the Corporation will
deposit with the Trustee or with one or more Paying Agents (or if the
Corporation is acting as its own Paying Agent, the Corporation will segregate
and hold in trust as provided in Section 10.3) an amount of money sufficient to
pay the Redemption Price of, and any accrued interest (including Additional
Interest) on, all the Securities which are to be redeemed on that date.
Section 11.6. Payment of Securities Called for Redemption.
If any notice of redemption has been given as provided in Section 11.4, the
Securities or portion of Securities with respect to which such notice has been
given shall become due and payable on the date and at the place or places stated
in such notice at the applicable Redemption Price, together with accrued
interest (including any Additional Interest) to the Redemption Date. On
presentation and surrender of such Securities at a Place of Payment in said
notice specified, the said Securities or the specified portions thereof shall be
paid and redeemed by the Corporation at the applicable Redemption Price,
together with accrued interest (including any Additional Interest) to the
Redemption Date; provided, however, that, installments of interest whose Stated
Maturity is on or prior to the Redemption Date will be payable to the Holders of
such Securities, or one or more Predecessor Securities, registered as such at
the close of business on the relevant record dates according to their terms and
the provisions of Section 3.8.
Upon presentation of any Security redeemed in part only, the Corporation shall
execute and the Trustee shall authenticate and deliver to the Holder thereof, at
the expense of the Corporation, a new Security or Securities, of authorized
denominations, in aggregate principal amount equal to the unredeemed portion of
the Security so presented and having the same Original Issue Date, Stated
Maturity and terms. If a Global Security is so surrendered, such new Security
(subject to Section 3.5) will also be a new Global Security.
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If any Security called for redemption shall not be so paid upon surrender
thereof for redemption, the principal of and premium, if any, on such Security
shall, until paid, bear interest from the Redemption Date at the rate prescribed
therefor in the Security.
ARTICLE XII
SUBORDINATION OF SECURITIES
Section 12.1. Securities Subordinate to Senior Debt.
The Corporation covenants and agrees, and each Holder of a Security, by its
acceptance thereof, likewise covenants and agrees, that, to the extent and in
the manner hereinafter set forth in this Article, the payment of the principal
of (and premium, if any) and interest (including any Additional Interest) on
each and all of the Securities are hereby expressly made subordinate and subject
in right of payment to the prior payment in full of all Senior Debt.
Section 12.2. Payment Over of Proceeds Upon Dissolution, Etc.
In the event of (a) any insolvency or bankruptcy case or proceeding, or any
receivership, liquidation, reorganization or other similar case or proceeding in
connection therewith, relative to the Corporation or to its creditors, as such,
or to its assets, or (b) any liquidation, dissolution or other winding up of the
Corporation, whether voluntary or involuntary and whether or not involving
insolvency or bankruptcy, or (c) any assignment for the benefit of creditors or
any other marshalling of assets and liabilities of the Company (each such event,
if any, herein sometimes referred to as a "Proceeding"), then and in any such
event the holders of Senior Debt shall be entitled to receive payment in full of
all amounts due or to become due on or in respect of all Senior Debt, or
provision shall be made for such payment in cash or cash equivalents, before the
Holders of the Securities are entitled to receive any payment on account of
principal of (or premium, if any) or interest on the Securities or on account of
the purchase or other acquisition of Securities, and to that end the holders of
Senior Debt shall be entitled to receive, for application to the payment
thereof, any payment or distribution of any kind or character, whether in cash,
property or securities, which may be payable or deliverable in respect of the
Securities in any such case, proceeding, dissolution, liquidation or other
winding up or event.
In the event that, notwithstanding the foregoing provisions of this Section,
the Trustee or the Holder of any Security (or any Person on its behalf) shall
have received any payment or distribution of assets of the Corporation of any
kind or character, whether in cash, property or securities, before all Senior
Debt is paid in full or payment thereof provided for, and if such fact shall, at
or prior to the time of such payment or distribution have been made known to the
Trustee or, as the case may be, such Holder, then and in such event such payment
or distribution shall be paid over or delivered forthwith to the trustee in
bankruptcy, receiver, liquidating trustee, custodian, assignee, agent or other
Person making payment or distribution
69
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of assets of the Corporation for application to the payment of all Senior Debt
remaining unpaid, to the extent necessary to pay all Senior Debt in full, after
giving effect to any concurrent payment or distribution to or for the holders of
Senior Debt.
For purposes of this Article only, the words "cash property or securities"
shall not be deemed to include shares of stock of the Corporation as reorganized
or readjusted, or securities of the Corporation or any other corporation
provided for by a plan of reorganization or readjustment, in each case, which
are subordinated in right of payment to all Senior Debt which may at the time be
outstanding to the same extent as, or to a greater extent than, the Securities
are so subordinated as provided in this Article. The consolidation of the
Corporation with, or the merger of the Corporation into, another Person or the
liquidation or dissolution of the Corporation following the conveyance or
transfer of its properties and assets substantially as an entirety to another
Person upon the terms and conditions set forth in Article VIII shall not be
deemed a dissolution, winding up, liquidation, reorganization, assignment for
the benefit of creditors or marshalling of assets and liabilities of the
Corporation for the purposes of this Section if the Person formed by such
consolidation or into which the Corporation is merged or the Person which
acquires by conveyance, transfer or lease such properties and assets
substantially as an entirety, as the case may be, shall, as a part of such
consolidation, merger, conveyance, transfer or lease, comply with the conditions
set forth in Article VIII.
Section 12.3. Prior Payment to Senior Debt Upon Acceleration of Securities.
In the event that any Securities are declared due and payable before their
Stated Maturity, then and in such event the holders of Senior Debt shall be
entitled to receive payment in full of all amounts due or to become due on or in
respect of all Senior Debt (including any amounts due upon acceleration), or
provision shall be made for such payment in cash or cash equivalents, before the
Holders of the Securities are entitled to receive any payment of the principal
of, premium, if any, or interest on the Securities or on account of the purchase
or other acquisition of Securities.
In the event that, notwithstanding the foregoing, the Corporation shall make
any payment to the Trustee or to or on behalf of the Holder of any Security
prohibited by the foregoing provisions of this Section, and if such fact shall,
at or prior to the time of such payment, have been made actually known to the
Trustee or, as the case may be, such Holder, then and in such event such payment
shall be paid over and delivered forthwith to the Corporation.
The provisions of this Section shall not apply to any payment with respect to
which Section 12.2 would be applicable.
Section 12.4. No Payment When Senior Debt in Default.
(a) In the event and during the continuation of any default in the payment of
principal of (or premium, if any) or interest on any Senior Debt beyond any
applicable grace period with
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respect thereto, or in the event that any event of default with respect to any
Senior Debt shall have occurred and be continuing and shall have resulted in
such Senior Debt becoming or being declared due and payable prior to the date on
which it would otherwise have become due and payable, unless and until such
event of default shall have been cured or waived or shall have ceased to exist
and any such acceleration shall have been rescinded or annulled, or (b) in the
event any judicial proceeding shall be pending with respect to any such default
in payment, or event of default, then no payment shall be made by the
Corporation on account of principal of (or premium, if any) or interest on the
Securities or on account of the purchase or other acquisition of Securities.
In the event that, notwithstanding the foregoing, the Corporation shall make
any payment to the Trustee or to or on behalf of the Holder of any Security
prohibited by the foregoing provisions of this Section, and if such fact shall,
at or prior to the time of such payment, have been made actually known to the
Trustee or, as the case may be, such Holder, then and in such event such payment
shall be paid over and delivered forthwith to the Corporation.
The provisions of this Section shall not apply to any payment with respect to
which Section 12.2 would be applicable.
Section 12.5. Payment Permitted If No Default.
Nothing contained in this Article or elsewhere in this Indenture or in any of
the Securities shall prevent (a) the Corporation, at any time except during the
pendency of any case, proceeding, dissolution, liquidation or other winding up,
assignment for the benefit of creditors or other marshalling of assets and
liabilities of the Corporation referred to in Section 12.2 or under the
conditions described in Section 12.3 or 12.4, from making payments at any time
of principal of (and premium, if any) or interest on the Securities, or (b) the
application by the Trustee of any money deposited with it hereunder to the
payment of or on account of the principal of (and premium, if any) or interest
on the Securities of any series or the retention of such payment by the Holder,
if, at the time of such application by the Trustee, it did not have actual
knowledge that such payment would have been prohibited by the provisions of this
Article.
Section 12.6. Subrogation to Rights of Holders of Senior Debt.
Subject to the payment in full of all amounts due or to become due on all
Senior Debt, or the provision for such payment in cash or cash equivalents or
otherwise in a manner satisfactory to the holders of Senior Debt, the Holders of
the Securities shall be subrogated to the extent of the payments or
distributions made to the holders of such Senior Debt pursuant to the provisions
of this Article (equally and ratably with the holders of all indebtedness of the
Corporation which by its express terms is subordinated to Senior Debt of the
Corporation to substantially the same extent as the Securities are subordinated
to the Senior Debt and is entitled to like rights of subrogation by reason of
any payments or distributions made to holders of such Senior Debt)
71
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to the rights of the holders of such Senior Debt to receive payments and
distributions of cash, property and securities applicable to the Senior Debt
until the principal of (and premium, if any) and interest on the Securities
shall be paid in full. For purposes of such subrogation, no payments or
distributions to the holders of the Senior Debt of any cash, property or
securities to which the Holders of the Securities or the Trustee would be
entitled except for the provisions of this Article, and no payments over
pursuant to the provisions of this Article to the holders of Senior Debt by
Holders of the Securities or the Trustee, shall, as among the Corporation, its
creditors other than holders of Senior Debt, and the Holders of the Securities,
be deemed to be a payment or distribution by the Corporation to or on account of
the Senior Debt.
Section 12.7. Provisions Solely to Define Relative Rights.
The provisions of this Article are and are intended solely for the purpose of
defining the relative rights of the Holders of the Securities on the one hand
and the holders of Senior Debt on the other hand. Nothing contained in this
Article or elsewhere in this Indenture or in the Securities is intended to or
shall (a) impair, as between the Corporation and the Holders of the Securities,
the obligations of the Corporation, which are absolute and unconditional, to pay
to the Holders of the Securities the principal of (and premium, if any) and
interest (including any Additional Interest) on the Securities as and when the
same shall become due and payable in accordance with their terms; or (b) affect
the relative rights against the Corporation of the Holders of the Securities and
creditors of the Corporation other than their rights in relation to the holders
of Senior Debt; or (c) prevent the Trustee or any Holder of the Securities from
exercising all remedies otherwise permitted by applicable law upon default under
this Indenture including, without limitation, filing and voting claims in any
Proceeding, subject to the rights, if any, under this Article of the holders of
Senior Debt to receive cash, property and securities otherwise payable or
deliverable to the Trustee or such Holder.
Section 12.8. Trustee to Effectuate Subordination.
Each Holder of the Securities by his or her acceptance thereof authorizes and
directs the Trustee on his or her behalf to take such action as may be necessary
or appropriate to acknowledge or effectuate the subordination provided in this
Article and appoints the Trustee his or her attorney-in-fact for any and all
such purposes.
Section 12.9. No Waiver of Subordination Provisions.
No right of any present or future holder of any Senior Debt to enforce
subordination as herein provided shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of the Corporation or by any
act or failure to act, in good faith, by any such holder, or by any
noncompliance by the Corporation with the terms, provisions and covenants of
this Indenture, regardless of any knowledge thereof that any such holder may
have or be otherwise charged with.
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Without in any way limiting the generality of the immediately preceding
paragraph, the holders of Senior Debt may, at any time and from to time, without
the consent of or notice to the Trustee or the Holders of the Securities,
without incurring responsibility to the Holders of the Securities and without
impairing or releasing the subordination provided in this Article or the
obligations hereunder of the Holders of the Securities to the holders of Senior
Debt, do any one or more of the following: (i) change the manner, place or terms
of payment or extend the time of payment of, or renew or alter, Senior Debt, or
otherwise amend or supplement in any manner Senior Debt or any instrument
evidencing the same or any agreement under which Senior Debt is outstanding;
(ii) sell, exchange, release or otherwise deal with any property pledged,
mortgaged or otherwise securing Senior Debt; (iii) release any Person liable in
any manner for the collection of Senior Debt; and (iv) exercise or refrain from
exercising any rights against the Corporation and any other Person.
Section 12.10. Notice to Trustee.
The Corporation shall give prompt written notice to the Trustee of any fact
known to the Corporation which would prohibit the making of any payment to or by
the Trustee in respect of the Securities. Notwithstanding the provisions of this
Article or any other provision of this Indenture, the Trustee shall not be
charged with knowledge of the existence of any facts which would prohibit the
making of any payment to or by the Trustee in respect of the Securities, unless
and until the Trustee shall have received written notice thereof from the
Corporation or a holder of Senior Debt or from any trustee, agent or
representative therefor; provided, however, that if the Trustee shall not have
received the notice provided for in this Section at least two Business Days
prior to the date upon which by the terms hereof any monies may become payable
for any purpose (including, without limitation, the payment of the principal of
(and premium, if any) or interest (including any Additional Interest) on any
Security), then, anything herein contained to the contrary notwithstanding, the
Trustee shall have full power and authority to receive such monies and to apply
the same to the purpose for which they were received and shall not be affected
by any notice to the contrary which may be received by it within two Business
Days prior to such date.
Subject to the provisions of Section 6.1, the Trustee shall be entitled to
rely conclusively on the delivery to it of a written notice by a Person
representing himself to be a holder of Senior Debt (or a trustee or attorney-in-
fact therefor) to establish that such notice has been given by a holder of
Senior Debt (or a trustee or attorney-in-fact therefor). In the event that the
Trustee determines in good faith that further evidence is required with respect
to the right of any Person as a holder of Senior Debt to participate in any
payment or distribution pursuant to this Article, the Trustee may request such
Person to furnish evidence to the reasonable satisfaction of the Trustee as to
the amount of Senior Debt held by such Person, the extent to which such Person
is entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such Person under this Article, and if such evidence
is not furnished, the Trustee may defer any payment to such Person pending
judicial determination as to the right of such Person to receive such payment.
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Section 12.11. Reliance on Judicial Order or Certificate of Liquidating
Agent.
Upon any payment or distribution of assets of the Corporation referred to in
this Article, the Trustee, subject to the provisions of Section 6.1, and the
Holders of the Securities shall be entitled to rely upon any order or decree
entered by any court of competent jurisdiction in which such Proceeding is
pending, or a certificate of the trustee in bankruptcy, receiver, liquidating
trustee, custodian, assignee for the benefit of creditors, agent or other Person
making such payment or distribution, delivered to the Trustee or to the Holders
of Securities, for the purpose of ascertaining the Persons entitled to
participate in such payment or distribution, the holders of the Senior Debt and
other indebtedness of the Corporation, the amount thereof or payable thereon,
the amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article.
Section 12.12. Trustee Not Fiduciary for Holders of Senior Debt.
The Trustee, in its capacity as trustee under this Indenture, shall not be
deemed to owe any fiduciary duty to the holders of Senior Debt and shall not be
liable to any such holders if it shall in good faith mistakenly pay over or
distribute to Holders of Securities or to the Corporation or to any other Person
cash, property or securities to which any holders of Senior Debt shall be
entitled by virtue of this Article or otherwise. With respect to the holders of
Senior Debt, the Trustee undertakes to perform or to observe only such of its
covenants or obligations as are specifically set forth in this Article, and no
implied covenants or obligations with respect to holders of Senior Debt shall be
read into this Indenture against the Trustee.
Section 12.13. Rights of Trustee as Holder of Senior Debt; Preservation of
Trustee's Rights.
The Trustee in its individual capacity shall be entitled to all the rights set
forth in this Article with respect to any Senior Debt which may at any time be
held by it, to the same extent as any other holder of Senior Debt, and nothing
in this Indenture shall deprive the Trustee of any of its rights as such holder.
Nothing in this Article shall apply to claims of, or payments to, the Trustee
under or pursuant to Section 6.7.
Section 12.14. Article Applicable to Paying Agents.
In case at any time any Paying Agent other than the Trustee shall have been
appointed by the Corporation and be then acting hereunder, the term "Trustee" as
used in this Article shall in such case (unless the context otherwise requires)
be construed as extending to and including such Paying Agent within its meaning
as fully for all intents and purposes as if such Paying Agent were named in this
Article in addition to or in place of the Trustee.
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* * * *
This instrument may be executed in any number of counterparts, each of which
so executed shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly
executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
RIGGS NATIONAL CORPORATION
By: /s/John L. Davis
----------------------------
John L. Davis
Chief Financial Officer
Attest: /s/Linda A. Madrid
------------------
Linda A. Madrid
Corporate Secretary
THE BANK OF NEW YORK
as Trustee
By: /s/Byron Merino
----------------------------
Byron Merino
Assistant Treasurer
Notary: /s/William J. Cassels
---------------------
William J. Cassels
Notary Public, State of New York
75
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TABLE OF CONTENTS
<TABLE>
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
<S> <C>
Section 1.1. Definitions............................................ 1
Section 1.2. Compliance Certificate and Opinions.................... 11
Section 1.3. Forms of Documents Delivered to Trustee................ 12
Section 1.4. Acts of Holders........................................ 12
Section 1.5. Notices, Etc. to Trustee and Corporation............... 15
Section 1.6. Notice to Holders; Waiver.............................. 15
Section 1.7. Conflict with Trust Indenture Act...................... 15
Section 1.8. Effect of Headings and Table of Contents............... 16
Section 1.9. Successors and Assigns................................. 16
Section 1.10. Separability Clause.................................... 16
Section 1.11. Benefits of Indenture.................................. 16
Section 1.12. Governing Law.......................................... 16
Section 1.13. Non-Business Days...................................... 16
ARTICLE II
SECURITY FORMS
Section 2.1. Forms Generally........................................ 17
Section 2.2. Form of Face of Security............................... 17
Section 2.3. Form of Reverse of Security............................ 22
Section 2.4. Additional Provisions Required in Global Security...... 25
Section 2.5. Form of Trustee's Certificate of Authentication........ 26
ARTICLE III
THE SECURITIES
Section 3.1. Title and Terms........................................ 26
Section 3.2. Denominations...........................................27
Section 3.3. Execution, Authentication, Delivery and Dating..........27
Section 3.4. Temporary Securities....................................28
Section 3.5. Global Securities.......................................28
Section 3.6. Registration, and Registration of Transfer and Exchange
Generally.............................................. 29
Section 3.7. Mutilated, Destroyed, Lost and Stolen Securities........32
Section 3.8. Payment of Interest; Interest Rights Preserved..........32
Section 3.9. Persons Deemed Owners...................................34
Section 3.10. Cancellation............................................34
</TABLE>
<PAGE>
<TABLE>
<S> <C>
Section 3.11. Computation of Interest................................34
Section 3.12. Deferrals of Interest Payment Dates....................35
Section 3.13. Right of Set-Off...................................... 36
Section 3.14. Agreed Tax Treatment...................................36
Section 3.15. CUSIP Numbers..........................................36
ARTICLE IV
SATISFACTION AND DISCHARGE
Section 4.1. Satisfaction and Discharge of Indenture................36
Section 4.2. Application of Trust Money.............................38
ARTICLE V
REMEDIES
Section 5.1. Events of Default......................................38
Section 5.2. Acceleration of Maturity; Rescission and Annulment.....39
Section 5.3. Collection of Debt and Suits for Enforcement by
Trustee................................................40
Section 5.4. Trustee May File Proofs of Claim.......................41
Section 5.5. Trustee May Enforce Claims Without Possession of
Securities.............................................42
Section 5.6. Application of Money Collected.........................42
Section 5.7. Limitation on Suits....................................42
Section 5.8. Unconditional Right of Holders to Receive Principal,
Premium and Interest; Direct Action by Holders of
Preferred Securities...................................43
Section 5.9. Restoration of Rights and Remedies.....................43
Section 5.10. Rights and Remedies Cumulative.........................44
Section 5.11. Delay or Omission Not Waiver...........................44
Section 5.12. Control by Holders.................................... 44
Section 5.13. Waiver of Past Defaults................................45
Section 5.14. Undertaking for Costs..................................45
Section 5.15. Waiver of Usury, Stay or Extension Laws................45
ARTICLE VI
THE TRUSTEE
Section 6.1. Certain Duties and Responsibilities....................46
Section 6.2. Notice of Defaults.....................................47
Section 6.3. Certain Rights of Trustee..............................47
Section 6.4. Not Responsible for Recitals or Issuance of Securities.49
Section 6.5. May Hold Securities....................................49
Section 6.6. Money Held in Trust................................... 49
</TABLE>
ii
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<TABLE>
<S> <C>
Section 6.7. Compensation and Reimbursement..........................49
Section 6.8. Disqualification; Conflicting Interests.................50
Section 6.9. Corporate Trustee Required; Eligibility.................50
Section 6.10. Resignation and Removal; Appointment of Successor.......51
Section 6.11. Acceptance of Appointment by Successor..................52
Section 6.12. Merger, Conversion, Consolidation or Succession to
Business................................................53
Section 6.13. Preferential Collection of Claims Against Corporat......54
Section 6.14. Appointment of Authenticating Agent.....................54
ARTICLE VII
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND CORPORATION
Section 7.1. Corporation to Furnish Trustee Names and Addresses of
Holders.................................................56
Section 7.2. Preservation of Information, Communications to Holders..56
Section 7.3. Reports by Trustee......................................56
Section 7.4. Reports by Corporation..................................57
ARTICLE VIII
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
Section 8.1. Corporation May Consolidate, Etc., Only on Certain Terms...57
Section 8.2. Successor Corporation Substituted..........................58
ARTICLE IX
SUPPLEMENTAL INDENTURES
Section 9.1. Supplemental Indentures without Consent of Holders......59
Section 9.2. Supplemental Indentures with Consent of Holders.........60
Section 9.3. Execution of Supplemental Indentures....................61
Section 9.4. Effect of Supplemental Indentures.......................61
Section 9.5. Conformity with Trust Indenture Act.....................61
Section 9.6. Reference in Securities to Supplemental Indentures......61
ARTICLE X
COVENANTS
Section 10.1. Payment of Principal, Premium and Interest..............62
Section 10.2. Maintenance of Office or Agency.........................62
Section 10.3. Money for Security Payments to be Held in Trust.........62
Section 10.4. Statement as to Compliance..............................64
Section 10.5. Waiver of Certain Covenants.............................64
</TABLE>
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<TABLE>
<S> <C>
Section 10.6. Additional Sums............................................... 64
Section 10.7. Additional Covenants.......................................... 65
ARTICLE XI
REDEMPTION OF SECURITIES
Section 11.1. Right of Redemption........................................... 66
Section 11.2. Election to Redeem; Notice to Trustee......................... 66
Section 11.3. Selection of Securities to be Redeemed........................ 67
Section 11.4. Notice of Redemption.......................................... 67
Section 11.5. Deposit of Redemption Price................................... 68
Section 11.6. Payment of Securities Called for Redemption................... 68
ARTICLE XII
SUBORDINATION OF SECURITIES
Section 12.1. Securities Subordinate to Senior Debt......................... 69
Section 12.2. Payment Over of Proceeds Upon Dissolution, Etc................ 69
Section 12.3. Prior Payment to Senior Debt Upon Acceleration of Securities.. 70
Section 12.4. No Payment When Senior Debt in Default........................ 70
Section 12.5. Payment Permitted If No Default............................... 71
Section 12.6. Subrogation to Rights of Holders of Senior Debt............... 71
Section 12.7. Provisions Solely to Define Relative Rights................... 72
Section 12.8. Trustee to Effectuate Subordination........................... 72
Section 12.9. No Waiver of Subordination Provisions......................... 72
Section 12.10. Notice to Trustee............................................. 73
Section 12.11. Reliance on Judicial Order or Certificate of Liquidating Agent 74
Section 12.12. Trustee Not Fiduciary for Holders of Senior Debt.............. 74
Section 12.13. Rights of Trustee as Holder of Senior Debt; Preservation of
Trustee's Rights.............................................. 74
Section 12.14. Article Applicable to Paying Agents........................... 74
</TABLE>
Annex A Trust Agreement
Annex B Amended and Restated Trust Agreement
Annex C Guarantee Agreement
iv
<PAGE>
STATE OF DELAWARE
PAGE 1
OFFICE OF THE SECRETARY OF STATE
________________________________
I, EDWARD J. FREEL, SECRETARY OF STATE OF THE STATE OF DELAWARE, DO HEREBY
CERTIFY THE ATTACHED IS A TRUE AND CORRECT COPY OF THE CERTIFICATE OF BUSINESS
TRUST REGISTRATION OF "RIGGS CAPITAL", FILED IN THIS OFFICE ON THE FIFTEENTH DAY
OF NOVEMBER, A.D. 1996, AT 4:30 O'CLOCK P.M.
[STAMP APPEARS HERE] /s/ Edward J. Freel
------------------------------------
Edward J. Freel, Secretary of State
2684760 8100
AUTHENTICATION: 8194947
960334353
DATE: 11-15-96
<PAGE>
CERTIFICATE OF TRUST
OF
RIGGS CAPITAL
This Certificate of Trust of Riggs Capital (the "Trust"), dated
November 15, 1996, is being duly executed and filed by the undersigned, as
trustee, to form a business trust under the Delaware Business Trust Act (12
Del. C. (S) 3801 et seq.).
1. Name. The name of the business trust being formed hereby is
Riggs Capital.
2. Delaware Trustees. The name and business address of the
trustee of the Trust with a principal place of business in the State of
Delaware is The Bank of New York (Delaware), White Clay Center, Route 273,
Newark, Delaware, 19711.
3. Effective Date. This Certificate of Trust shall be effective
as of November 15, 1996.
IN WITNESS WHEREOF, the undersigned, being the trustees of the
Trust, have executed this Certificate of Trust as of the date first above
written.
THE BANK OF NEW YORK
(DELAWARE), as Trustee
By:/s/ Melissa J. Beneduce
-----------------------
Name: MELISSA J. BENEDUCE
Title: Assistant Vice President
_______________________
Linda A. Madrid,
as Trustee
_______________________
Timothy C. Coughlin
as Trustee
STATE OF DELAWARE
SECRETARY OF STATE
DIVISION OF CORPORATIONS
FILED 04:30 PM 11/15/1996
960334353 - 2684760
<PAGE>
CERTIFICATE OF TRUST
OF
RIGGS CAPITAL
This Certificate of Trust of Riggs Capital (the "Trust"), dated November
15, 1996, is being duly executed and filed by the undersigned, as trustee, to
form a business trust under the Delaware Business Trust Act (12 Del. C. (S) 3801
et seq.).
1. Name. The name of the business trust being formed hereby is Riggs
Capital.
2. Delaware Trustees. The name and business address of the trustee of
the Trust with a principal place of business in the State of Delaware is The
Bank of New York (Delaware), White Clay Center, Route 273, Newark, Delaware,
19711.
3. Effective Date. This Certificate of Trust shall be effective as
of November 15, 1996.
IN WITNESS WHEREOF, the undersigned, being the trustees of the Trust,
have executed this Certificate of Trust as of the date first above written.
THE BANK OF NEW YORK
(DELAWARE), as Trustee
By: ________________________
Name:
Title:
/s/ Linda A. Madrid
-----------------------
Linda A. Madrid,
as Trustee
/s/ Timothy C. Coughlin
-----------------------
Timothy C. Coughlin
as Trustee
<PAGE>
ANNEX A
TRUST AGREEMENT
OF
RIGGS CAPITAL
This TRUST AGREEMENT, dated as of November 15, 1996, between Riggs
National Corporation, a Delaware corporation, as "Depositor" and Linda A. Madrid
and Timothy C. Coughlin as "Administrative Trustees" and The Bank of New York
(Delaware) as "Delaware Trustee" (the Delaware Trustee and the Administrative
Trustees together, the "Trustees"). The Depositor and the Trustee hereby agree
as follows:
1. The trust created hereby shall be known as Riggs Capital, in which
name the Trustee, or the Depositor to the extent provided herein, may engage in
the transactions contemplated hereby, make and execute contracts, and sue and be
sued.
2. The Depositor hereby assigns, transfers, conveys and sets over to
the Trustee the sum of $10. The Administrative Trustees hereby acknowledge
receipt of such amount in trust from the Depositor, which amount shall
constitute the initial trust estate. The Trustees hereby declare that they will
hold the trust estate in trust for the Depositor. It is the intention of the
parties hereto that the Trust created hereby constitute a business trust under
Chapter 38 of Title 12 of the Delaware Code, 12 Del. C. (S) 3801 et seq. (the
--- - -- ---
"Business Trust Act"), and that this document constitute the governing
instrument of the Trust. The Trustees are hereby authorized and directed to
execute and file a certificate of trust with the Delaware Secretary of State in
accordance with the provisions of the Business Trust Act.
3. The Depositor and the Trustees shall enter into an amended and
restated Trust Agreement, satisfactory to each such party, to provide for the
contemplated operation of the Trust created hereby and the issuance of the
Preferred Securities and Common Securities of the Trust. Prior to the execution
and delivery of such amended and restated Trust Agreement, the Trustee (or
Trustees, as may be applicable) shall not have any duty or obligation hereunder
or with respect to the trust estate, except as otherwise required by applicable
law or as may be necessary to obtain prior to such execution and delivery any
licenses, consents or approvals required by applicable law or otherwise.
<PAGE>
4. The Depositor and the Administrative Trustees hereby
authorize the Depositor, as the sponsor of the Trust and at its sole
discretion, (i) to take such actions as each may deem necessary or
-
appropriate to make the Preferred Securities eligible to be offered
pursuant to Rule 144A under the Securities Act of 1933, as amended; (ii) to
--
file with The Depository Trust Company or with any other exchange or
trading facility located in the United States of America or abroad (each,
an "Exchange") and execute on behalf of the Trust a registration or listing
application or applications and all other applications, statements,
certificates, agreements and other instruments as shall be necessary or
desirable to cause the Preferred Securities to be registered or listed on
any Exchange or trading facility; (iii) to file and execute on behalf of
---
the Trust such applications, reports, surety bonds, irrevocable consents,
appointments of attorney for service of process and other papers and
documents as the Depositor, on behalf of the Trust, may deem necessary or
desirable; (iv) to execute on behalf of the Trust such Purchase Agreements
--
with one or more underwriters relating to the offering of the Preferred
Securities as the Depositor, on behalf of the Trust, may deem necessary or
desirable; and (v) to take or cause to be taken any and all acts that the
-
Depositor, in its sole discretion, may deem necessary or advisable to carry
out the purpose of the Trust. In the event that any filing referred to in
clauses (ii) and (iii) above is required, by the rules and regulations of
any trading facility or Exchange, state securities or Blue Sky laws, or any
applicable federal or state laws or regulations, to be executed on behalf
of the Trust by a Trustee, any administrative Trustee is hereby authorized
to join in any such filing and to execute on behalf of the Trust any and
all of the foregoing.
5. This Trust Agreement may be executed in one or more
counterparts.
6. The number of Trustees initially shall be three (3) and
thereafter the number of Trustees shall be such number as shall be fixed
from time to time by a written instrument signed by the Depositor which may
increase or decrease the number of Trustees; provided, however, that to the
extent required by the Business Trust Act, the Delaware Trustee shall
either be a natural person who is a resident of the State of Delaware or,
if not a natural person, an entity which has its principal place of
business in the State of Delaware and otherwise meets the requirements of
applicable Delaware law. Subject to the foregoing, the Depositor is
entitled to appoint or remove without cause any Trustee at any time. The
Trustee may resign upon thirty days' prior notice to the Depository
provided, however, such notice shall not be required if it is waived by the
-------- -------
Depositor.
<PAGE>
7. This Trust Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware (without regard to conflict
of laws principles).
[Remainder of Page Intentionally Blank]
-3-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Trust
Agreement to be duly executed as of the day and year first above written.
RIGGS NATIONAL
CORPORATION,
as Depositor
By: __________________________
Name:
Title:
THE BANK OF NEW YORK
(DELAWARE)
as Delaware Trustee
By: __________________________
Name:
Title:
/s/ Linda A. Madrid
------------------------------
Linda A. Madrid,
as Administrative
Trustee
/s/ Timothy C. Coughlin
------------------------------
Timothy C. Coughlin,
as Administrative
Trustee
-4-
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Trust
Agreement to be duly executed as of the day and year first above written.
RIGGS NATIONAL
CORPORATION,
as Depositor
By: _____________________________
Name:
Title:
THE BANK OF NEW YORK
(DELAWARE)
as Delaware Trustee
By: /s/ Melissa J. Beneduce
----------------------------
Name: Melissa J. Beneduce
Title: Assitance Vice President
_____________________________
Linda A. Madrid,
as Administrative
Trustee
_____________________________
Timothy C. Coughlin,
as Administrative
Trustee
-4-
<PAGE>
================================================================================
AMENDED AND RESTATED
TRUST AGREEMENT
among
RIGGS NATIONAL CORPORATION,
as Depositor,
THE BANK OF NEW YORK,
as Property Trustee,
THE BANK OF NEW YORK (DELAWARE),
as Delaware Trustee,
and
THE ADMINISTRATIVE TRUSTEES NAMED HEREIN
Dated as of December 13, 1996
RIGGS CAPITAL
================================================================================
<PAGE>
RIGGS CAPITAL
Certain Sections of this Trust Agreement relating to
Sections 310 through 318 of the
Trust Indenture Act of 1939:
<TABLE>
<CAPTION>
Trust Indenture Trust Agreement
Act Section Section
- --------------- ---------------
<S> <C>
((S)) 310 (a)(1)............................................... 8.7
(a)(2)............................................... 8.7
(a)(3)............................................... 8.9
(a)(4)............................................... 2.7(a)(ii)
(b).................................................. 8.8
((S)) 311 (a).................................................. 8.13
(b).................................................. 8.13
((S)) 312 (a).................................................. 5.7
(b).................................................. 5.7
(c).................................................. 5.7
((S)) 313 (a).................................................. 8.14(a)
(a)(4)............................................... 8.14(b)
(b).................................................. 8.14(b)
(c).................................................. 10.8
(d).................................................. 8.14(c)
((S)) 314 (a).................................................. 8.15
(b).................................................. Not Applicable
(c)(1)............................................... 8.16
(c)(2)............................................... 8.16
(c)(3)............................................... Not Applicable
(d).................................................. Not Applicable
(e).................................................. 1.1, 8.16
((S)) 315 (a).................................................. 8.1(a), 8.3(a)
(b).................................................. 8.2, 10.8
(c).................................................. 8.1(a)
(d).................................................. 8.1, 8.3
(e).................................................. Not Applicable
((S)) 316 (a).................................................. Not Applicable
(a)(1)(A)............................................ Not Applicable
(a)(1)(B)............................................ Not Applicable
(a)(2)............................................... Not Applicable
(b).................................................. 5.14
(c).................................................. 6.7
((S)) 317 (a)(1)............................................... Not Applicable
(a)(2)............................................... Not Applicable
(b).................................................. 5.9
((S)) 318 (a).................................................. 10.10
</TABLE>
____________
Note: This reconciliation and tie sheet shall not, for any purpose, be deemed to
be a part of the Trust Agreement.
<PAGE>
TABLE OF CONTENTS
<TABLE>
ARTICLE I.
<S> <C>
Defined Terms........................................ 1
Section 1.1. Definitions........................................................... 1
ARTICLE II.
Continuation of the Trust.................................. 12
Section 2.1. Name.................................................................. 12
Section 2.2. Office of the Delaware Trustee; Principal Place of Business........... 12
Section 2.3. Initial Contribution of Trust Property; Organizational Expenses....... 12
Section 2.4. Issuance of the Preferred Securities.................................. 12
Section 2.5. Issuance of the Common Securities; Subscription and Purchase of
Debentures............................................................ 13
Section 2.6. Declaration of Trust.................................................. 13
Section 2.7. Authorization to Enter into Certain Transactions...................... 13
Section 2.8. Assets of Trust....................................................... 17
Section 2.9. Title to Trust Property............................................... 17
ARTICLE III.
Payment Account........................................ 17
Section 3.1. Payment Account....................................................... 17
ARTICLE IV.
Distributions; Redemption................................... 18
Section 4.1. Distributions......................................................... 19
Section 4.2. Redemption............................................................ 19
Section 4.3. Subordination of Common Securities.................................... 21
Section 4.4. Payment Procedures.................................................... 21
Section 4.5. Tax Returns and Reports............................................... 22
Section 4.6. Payment of Taxes, Duties, Etc. of the Trust........................... 22
Section 4.7. Payments under Indenture or Pursuant to Direct Actions................ 22
Section 4.8. Liability for Debts and Obligations of the Trust...................... 22
</TABLE>
i
<PAGE>
<TABLE>
ARTICLE V.
<S> <C> <C>
Trust Securities...................................... 23
Section 5.1. Initial Ownership..................................................... 23
Section 5.2. The Preferred Securities.............................................. 23
Section 5.3. Execution and Delivery of Trust Securities............................ 24
Section 5.4. Global Preferred Securities........................................... 24
Section 5.5. Registration, Registration of Transfer and Exchange of
Preferred Securities Generally; Certain Transfer and Echanges;
Securities Act Legends................................................ 26
Section 5.6. Mutilated, Destroyed, Lost or Stolen Trust Securities Certificates.... 31
Section 5.7. Persons Deemed Securityholders........................................ 32
Section 5.8. Access to List of Securityholders' Names and Addresses................ 32
Section 5.9. Maintenance of Office or Agency....................................... 32
Section 5.10. Appointment of Paying Agent........................................... 32
Section 5.11. Ownership of Common Securities by Depositor........................... 33
Section 5.12. Notices to Clearing Agency............................................ 33
Section 5.13. Temporary Preferred Securities........................................ 33
Section 5.14. Rights of Securityholders............................................. 34
ARTICLE VI.
Acts of Securityholders; Meetings; Voting.......................... 36
Section 6.1. Limitations on Voting Rights.......................................... 36
Section 6.2. Notice of Meetings.................................................... 37
Section 6.3. Meetings of Preferred Securityholders................................. 37
Section 6.4. Voting Rights......................................................... 37
Section 6.5. Proxies, etc.......................................................... 37
Section 6.6. Securityholder Action by Written Consent.............................. 38
Section 6.7. Record Date for Voting and Other Purposes............................. 38
Section 6.8. Acts of Securityholders............................................... 38
Section 6.9. Inspection of Records................................................. 39
ARTICLE VII.
Representations and Warranties of the Property Trustee, the Delaware
Trustee and the Depositor............................................................ 39
Section 7.1. Property Trustee...................................................... 39
Section 7.2. Delaware Trustee...................................................... 40
Section 7.3 Depositor............................................................. 41
</TABLE>
ii
<PAGE>
<TABLE>
ARTICLE VIII.
<S> <C> <C>
The Trustees......................................... 43
Section 8.1. Certain Duties and Responsibilities................................... 43
Section 8.2. Certain Notices....................................................... 44
Section 8.3. Certain Rights of Property Trustee.................................... 44
Section 8.4. Not Responsible for Recitals or Issuance of Securities................ 46
Section 8.5. May Hold Securities................................................... 46
Section 8.6. Compensation; Indemnity; Fees......................................... 47
Section 8.7. Corporate Property Trustee Required; Eligibility of Trustees.......... 48
Section 8.8. Conflicting Interests................................................. 48
Section 8.9. Co-Trustees and Separate Trustee...................................... 48
Section 8.10. Resignation and Removal; Appointment of Successor..................... 50
Section 8.11. Acceptance of Appointment by Successor................................ 51
Section 8.12. Merger, Conversion, Consolidation or Succession to Business........... 52
Section 8.13. Preferential Collection of Claims Against Depositor or Trust.......... 52
Section 8.14. Reports by Property Trustee........................................... 53
Section 8.15. Reports to the Property Trustee....................................... 54
Section 8.16. Evidence of Compliance with Conditions Precedent...................... 54
Section 8.17. Number of Trustees.................................................... 54
Section 8.18. Delegation of Power................................................... 54
ARTICLE IX.
Termination, Liquidation and Merger.............................. 55
Section 9.1. Termination Upon Expiration Date...................................... 55
Section 9.2. Early Termination..................................................... 55
Section 9.3. Termination........................................................... 56
Section 9.4. Liquidation........................................................... 56
Section 9.5. Mergers, Consolidations, Amalgamations or Replacements of
the Trust............................................................. 57
ARTICLE X.
Miscellaneous Provisions................................... 58
Section 10.1. Limitation of Rights of Securityholders............................... 58
Section 10.2. Amendment............................................................. 58
Section 10.3. Separability.......................................................... 60
Section 10.4. Governing Law......................................................... 60
Section 10.5. Payments Due on Non-Business Day...................................... 60
Section 10.6. Successors............................................................ 60
</TABLE>
iii
<PAGE>
<TABLE>
<S> <C> <C>
Section 10.7. Headings............................................................. 60
Section 10.8. Reports, Notices and Demands......................................... 60
Section 10.9. Agreement Not to Petition............................................ 61
Section 10.10. Trust Indenture Act; Conflict with Trust Indenture Act............... 61
Section 10.11. Acceptance of Terms of Trust Agreement, Guarantee
and Indenture........................................................ 62
Section 10.12. Counterparts......................................................... 62
</TABLE>
iv
<PAGE>
AMENDED AND RESTATED TRUST AGREEMENT, dated as of December 13, 1996, among
(i) Riggs National Corporation, a Delaware corporation (including any successors
or assigns, the "Depositor"), (ii) The Bank of New York, a banking corporation
organized under the laws of the State of New York, as property trustee (in such
capacity, the "Property Trustee"), (iii) The Bank of New York (Delaware), a
banking corporation organized under the laws of the State of Delaware, as
Delaware trustee (the "Delaware Trustee"), (iv) Timothy C. Coughlin, an
individual, and Linda A. Madrid, an individual, each of whose address is c/o
Riggs National Corporation, 1503 Pennsylvania Avenue, N.W., Washington, D.C.
20005 (each an "Administrative Trustee" and collectively, the "Administrative
Trustees") (the Property Trustee, the Delaware Trustee and the Administrative
Trustees referred to collectively as the "Trustees") and (v) the several
Holders, as hereinafter defined.
Witnesseth
Whereas, the Depositor and the Delaware Trustee have heretofore duly
declared and established a business trust, Riggs Capital, pursuant to the
Delaware Business Trust Act by the entering into that certain Trust Agreement,
dated as of November 15, 1996 (the "Original Trust Agreement"), and by the
execution and filing by the Property Trustee and the Delaware Trustee with the
Secretary of State of the State of Delaware of the Certificate of Trust, filed
on November 15, 1996, attached as Exhibit A; and
Whereas, the Depositor and the Trustees desire to amend and restate the
Original Trust Agreement in its entirety as set forth herein to provide for,
among other things, (i) the issuance of the Common Securities by the Trust to
the Depositor, (ii) the issuance and sale of the Preferred Securities by the
Trust pursuant to the Purchase Agreement, (iii) the acquisition by the Trust
from the Depositor of all of the right, title and interest in the Debentures and
(iv) the appointment of the Administrative Trustees;
Now Therefore, in consideration of the agreements and obligations set forth
herein and for other good and valuable consideration, the sufficiency of which
is hereby acknowledged, each party, for the benefit of the other parties and for
the benefit of the Securityholders, as hereinafter defined, hereby amends and
restates the Original Trust Agreement in its entirety and agrees as follows:
ARTICLE I
Defined Terms
Section 1.1. Definitions.
For all purposes of this Trust Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to them in
this Article and include the plural as well as the singular;
<PAGE>
(b) all other terms used herein that are defined in the Trust Indenture
Act, either directly or by reference therein, have the meanings assigned to them
therein;
(c) unless the context otherwise requires, any reference to an "Article" or
a "Section" refers to an Article or a Section, as the case may be, of this Trust
Agreement; and
(d) the words "herein", "hereof" and "hereunder" and other words of similar
import refer to this Trust Agreement as a whole and not to any particular
Article, Section or other subdivision.
"Accredited Investor" means an accredited investor within the meaning of
Rule 501(a) of Regulation D under the Securities Act.
"Act" has the meaning specified in Section 6.8.
"Additional Amount" means, with respect to Trust Securities of a given
Liquidation Amount and/or a given period, the amount of Additional Interest (as
defined in the Indenture) paid by the Depositor on a Like Amount of Debentures
for such period.
"Additional Sums" has the meaning specified in Section 10.6 of the
Indenture.
"Administrative Trustee" means each of the Persons identified as an
"Administrative Trustee" in the preamble to this Trustee Agreement solely in
such Person's capacity as Administrative Trustee of the Trust formed and
continued hereunder and not in such Person's individual capacity, or such
Administrative Trustee's successor in interest in such capacity, or any
successor trustee appointed as herein provided.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Agent Member" means any member of, or participant in, the Depositary.
"Applicable Procedures" means, with respect to any transfer or transaction
involving a Global Preferred Security, the rules and procedures of the Clearing
Agency for such Global Preferred Security, in each case to the extent applicable
to such transaction and as in effect from time to time.
"Bankruptcy Event" means, with respect to any Person:
(a) the entry of a decree or order by a court having jurisdiction in the
premises judging such Person a bankrupt or insolvent, or approving as properly
filed a petition seeking reorganization, arrangement, adjudication or
composition of or in respect of such Person under any applicable federal or
state bankruptcy, insolvency, reorganization or other similar law, or
-2-
<PAGE>
appointing a receiver, liquidator, assignee, trustee, sequestrator (or other
similar official) of such Person or of any substantial part of its property or
ordering the winding up or liquidation of its affairs, and the continuance of
any such decree or order unstayed and in effect for a period of 60 consecutive
days; or
(b) the institution by such Person of proceedings to be adjudicated a
bankrupt or insolvent, or the consent by it to the institution of bankruptcy or
insolvency proceedings against it, or the filing by it of a petition or answer
or consent seeking reorganization or relief under any applicable federal or
state bankruptcy, insolvency, reorganization or other similar law, or the
consent by it to the filing of any such petition or to the appointment of a
receiver, liquidator, assignee, trustee, sequestrator (or similar official) of
such Person or of any substantial part of its property, or the making by it of
an assignment for the benefit of creditors, or the admission by it in writing of
its inability to pay its debts generally as they become due and its willingness
to be adjudicated a bankrupt, or the taking of corporate action by such Person
in furtherance of any such action.
"Bankruptcy Laws" has the meaning specified in Section 10.9.
"Board Resolution" means a copy of a resolution certified by the Secretary
or an Assistant Secretary of the Depositor to have been duly adopted by the
Depositor's Board of Directors, or such committee of the Board of Directors or
officers of the Depositor to which authority to act on behalf of the Board of
Directors has been delegated, and to be in full force and effect on the date of
such certification, and delivered to the appropriate Trustee.
"Business Day" means a day other than (a) a Saturday or Sunday, (b) a day
on which banking institutions in The City of New York are authorized or required
by law or executive order to remain closed, or (c) a day on which the Property
Trustee's Corporate Trust Office or the Corporate Trust Office of the Debenture
Trustee is closed for business.
"Capital Treatment Event" means the reasonable determination by the
Depositor that, as a result of any amendment to, or change (including any
proposed change) in, the laws (or any regulations thereunder) of the United
States or any political subdivision thereof or therein or as a result of any
official or administrative pronouncement or action or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
effective or such proposed change, pronouncement, action or decision is
announced on or after the date of issuance of the Preferred Securities
hereunder, there is more than an insubstantial risk that the Depositor will not
be entitled to treat an amount equal to the Liquidation Amount of the Preferred
Securities as "Tier I Capital" (or the then equivalent thereof) for purposes of
the capital adequacy guidelines of the Federal Reserve, as then in effect and
applicable to the Depositor.
"Cedel" means Cedel Bank, societe anonyme (or any successor securities
clearing agency).
"Certificate Depositary Agreement" means the agreement among the Trust, the
Depositor and The Depository Trust Company, as the initial Clearing Agency,
dated as of the Closing Date,
-3-
<PAGE>
relating to the Trust Securities Certificates, substantially in the form
attached as Exhibit B, as the same may be amended and supplemented from time to
time.
"Clearing Agency" means an organization registered as a "clearing agency"
pursuant to Section 17A of the Securities Exchange Act of 1934, as amended. The
Depository Trust Company will be the initial Clearing Agency.
"Clearing Agency Participant" means a broker, dealer, bank, other financial
institution or other Person for whom from time to time a Clearing Agency effects
book-entry transfers and pledges of securities deposited with the Clearing
Agency.
"Closing Time" has the meaning specified in the Purchase Agreement.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission, as from time to
time constituted, created under the Securities Exchange Act of 1934, as amended,
or, if at any time after the execution of this instrument such Commission is not
existing and performing the duties now assigned to it under the Trust Indenture
Act, then the body performing such duties at such time.
"Common Security" means an undivided beneficial interest in the assets of
the Trust, having a Liquidation Amount of $1,000 and having the rights provided
therefor in this Trust Agreement, including the right to receive Distributions
and a Liquidation Distribution as provided herein.
"Common Securities Certificate" means a certificate evidencing ownership of
Common Securities, substantially in the form attached as Exhibit B.
"Corporate Trust Office" means (i) when used with respect to the Property
Trustee, the principal corporate trust office of the Property Trustee located in
New York, New York, and (ii) when used with respect to the Debenture Trustee,
the principal corporate trust office of the Debenture Trustee located in New
York, New York.
"Debenture Event of Default" means an "Event of Default" as defined in the
Indenture.
"Debenture Redemption Date" means, with respect to any Debentures to be
redeemed under the Indenture, the date fixed for redemption under the Indenture.
"Debenture Tax Event" means a "Tax Event" as defined in the Indenture.
"Debenture Trustee" means The Bank of New York, a banking corporation
organized under the laws of the State of New York, and any successor thereto, as
trustee under the indenture.
-4-
<PAGE>
"Debentures" means the aggregate principal amount of the Depositor's 8 5/8%
Junior Subordinated Deferrable Interest Debentures, Series A, issued pursuant to
the Indenture.
"Definitive Preferred Security" means a Preferred Security issued in
certificated, fully registered form (non-global) as provided in Section 5.2, 5.4
or 5.12, substantially in the form set forth in Exhibit C-3.
"Delaware Business Trust Act" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. C. ((S)) 3801, et seq., as it may be amended from time to time.
"Delaware Trustee" means the Person identified as the "Delaware Trustee" in
the preamble to this Trust Agreement solely in its capacity as Delaware Trustee
of the Trust formed and continued hereunder and not in its individual capacity,
or its successor in interest in such capacity, or any successor trustee
appointed as herein provided.
"Depositor" has the meaning specified in the preamble to this Trust
Agreement.
"Distribution Date" has the meaning specified in Section 4.1(a).
"Distributions" means amounts payable in respect of the Trust Securities as
provided in Section 4.1.
"Early Termination Event" has the meaning specified in Section 9.2.
"DTC" means the Depository Trust Company (or any successor securities
clearing agency).
"Euroclear" means The Euroclear System (or any successor securities
clearing agency).
"Event of Default" means any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(a) the occurrence of a Debenture Event of Default; or
(b) default by the Trust in the payment of any Distribution when it becomes
due and payable, and continuation of such default for a period of 30 days; or
(c) default by the Trust in the payment of any Redemption Price of any
Trust Security when it becomes due and payable; or
(d) default in the performance, or breach, in any material respect, of any
covenant or warranty of the Trustees in this Trust Agreement (other than a
covenant or warranty a default in the performance or breach of which is dealt
with in clause (b) or (c) above) and continuation of such default or breach for
a period of 60 days after there has been given, by registered or
-5-
<PAGE>
certified mail, to the defaulting Trustee or Trustees by the Holders of at least
25% in aggregate Liquidation Amount of the Outstanding Preferred Securities a
written notice specifying such default or breach and requiring it to be remedied
and stating that such notice is a "Notice of Default" hereunder; or
(e) the occurrence of a Bankruptcy Event with respect to the Property
Trustee and the failure by the Depositor to appoint a successor Property Trustee
within 60 days thereof.
"Expense Agreement" means the Agreement as to Expenses and Liabilities
between the Depositor, in its capacity as Holder of the Common Securities, and
the Trust entered into on December 13, 1996.
"Expiration Date" has the meaning specified in Section 9.1.
"Federal Reserve" means the Board of Governors of the Federal Reserve
System, as from time to time constituted, or if at any time after the execution
of this agreement the Federal Reserve is not existing in performing the duties
now assigned to it, then the body performing such duties at such time.
"Global Preferred Security" means a Preferred Security, the ownership and
transfers of which shall be made through book entries by a Clearing Agency as
described in Section 5.4.
"Global Regulation S Preferred Security" has the meaning specified in
Section 5.2.
"Global Rule 144A Preferred Security" has the meaning specified in Section
5.2.
"Guarantee" means the Guarantee Agreement executed and delivered by the
Depositor and The Bank of New York, as trustee, contemporaneously with the
execution and delivery of this Trust Agreement, for the benefit of the Holders
of the Preferred Securities, as amended from time to time.
"Holder" mean a Person in whose name a Trust Security or Trust Securities
are registered in the Securities Register; any such person shall be deemed to be
a beneficial owner within the meaning of the Delaware Business Trust Act.
"Indenture" means the Junior Subordinated Indenture, dated as of December
13, 1996, between the Depositor and the Debenture Trustee, as trustee, as
amended or supplemented from time to time.
"Lien" means any lien, pledge, charge, encumbrance, mortgage, deed of
trust, adverse ownership interest, hypothecation, assignment, security interest
or preference, priority or other security agreement or preferential arrangement
of any kind or nature whatsoever.
"Like Amount" means (a) with respect to a redemption of Trust Securities,
Trust Securities having a Liquidation Amount equal to that portion of the
principal amount of Debentures to be contemporaneously redeemed in accordance
with the Indenture allocated to the
-6-
<PAGE>
Trust Securities pro rata based upon the relative Liquidation Amounts of such
Trust Securities and the proceeds of which will be used to pay the Redemption
Price of such Trust Securities, and (b) with respect to a distribution of
Debentures to Holders of Trust Securities in exchange therefor in connection
with a dissolution or liquidation of the Trust, Debentures having a principal
amount equal to the Liquidation Amount of the Trust Securities of the Holder to
whom such Debentures are distributed.
"Liquidation Amount" means the stated amount of $1,000 per Trust Security.
"Liquidation Date" means the date on which Debentures are to be distributed
to Holders of Trust Securities in connection with a termination and liquidation
of the Trust pursuant to Section 9.4(a).
"Liquidation Distribution" has the meaning specified in Section 9.4(d).
"1940 Act" means the Investment Company Act of 1940, as amended.
"Officers' Certificate" means a certificate signed by the Chairman and
Chief Executive Officer, President or a Vice President, and by the Treasurer, an
Associate Treasurer, an Assistant Treasurer, the Controller, the Secretary or an
Assistant Secretary, of the Depositor, and delivered to the appropriate Trustee.
One of the officers signing an Officers' Certificate given pursuant to Section
8.16 shall be the principal executive, financial or accounting officer of the
Depositor. Any Officers' Certificate delivered with respect to compliance with a
condition or covenant provided for in this Trust Agreement shall include:
(a) a statement that each officer signing the Officers' Certificate has
read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Officers' Certificate;
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(d) a statement as to whether, in the opinion of each such officer, such
condition or covenant has been complied with.
"Opinion of Counsel" means a written opinion of counsel, who may be counsel
for the Trust, the Property Trustee or the Depositor, but not an employee of any
thereof, and who shall be reasonably acceptable to the Property Trustee.
"Original Preferred Securities" has the meaning specified in Section 2.4.
"Original Trust Agreement" has the meaning specified in the recitals to
this Trust Agreement.
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"Other Preferred Securities" means the Preferred Securities sold by the
Initial Purchasers in the initial offering contemplated by the Purchase
Agreement to Accredited Investors in reliance on an exemption from the
registration requirements of the Securities Act other than Rule 144A and
Regulation S thereunder, substantially in the form set forth in Exhibit C-3.
"Outstanding", when used with respect to Trust Securities, means, as of the
date of determination, all Trust Securities theretofore executed and delivered
under this Trust Agreement, except:
(a) Trust Securities theretofore cancelled by the Property Trustee or
delivered to the Property Trustee for cancellation;
(b) Trust Securities for whose payment or redemption money in the necessary
amount has been theretofore deposited with the Property Trustee or any Paying
Agent for the Holders of such Trust Securities; provided that, if such Trust
Securities are to be redeemed, notice of such redemption has been duly given
pursuant to this Trust Agreement; and
(c) Trust Securities which have been paid or in exchange for or in lieu of
which other Preferred Securities have been executed and delivered pursuant to
Sections 5.4, 5.5, 5.11 and 5.13;
provided, however, that in determining whether the Holders of the requisite
Liquidation Amount of the Outstanding Preferred Securities have given any
request, demand, authorization, direction, notice, consent or waiver hereunder,
Preferred Securities owned by the Depositor, any Trustee or any Affiliate of the
Depositor or any Trustee shall be disregarded and deemed not to be Outstanding,
except that (a) in determining whether any Trustee shall be protected in relying
upon any such request, demand, authorization, direction, notice, consent or
waiver, only Preferred Securities that such Trustee knows to be so owned shall
be so disregarded and (b) the foregoing shall not apply at any time when all of
the outstanding Preferred Securities are owned by the Depositor, one or more of
the Trustees and/or any such Affiliate. Preferred Securities so owned which have
been pledged in good faith may be regarded as Outstanding if the pledgee
establishes to the satisfaction of the Administrative Trustees the pledgee's
right so to act with respect to such Preferred Securities and that the pledgee
is not the Depositor or any Affiliate of the Depositor.
"Owner" means each Person who is the beneficial owner of a beneficial
interest in a Global Preferred Security as reflected in the records of the
Clearing Agency or, if a Clearing Agency Participant is not the beneficial
owner, then as reflected in the records of a Person maintaining an account with
such Clearing Agency (directly or indirectly, in accordance with the rules of
such Clearing Agency).
"Paying Agent" means any paying agent or co-paying agent appointed pursuant
to Section 5.10 and shall initially be The Bank of New York.
"Payment Account" means a segregated non-interest-bearing corporate trust
account maintained by the Property Trustee at The Bank of New York in its trust
department for the benefit of the Securityholders in which all amounts paid in
respect of the Debentures will be held
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and from which the Property Trustee, through the Paying Agent, shall make
payments to the Securityholders in accordance with Sections 4.1 and 4.2.
"Person" means any individual, corporation, partnership, joint venture,
trust, limited liability company or corporation, unincorporated organization or
government or any agency or political subdivision thereof.
"Preferred Security" means an undivided beneficial interest in the assets
of the Trust, having a Liquidation Amount of $1,000 and having the rights
provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution as provided herein.
"Preferred Securities Certificate" means a certificate evidencing ownership
of Preferred Securities, substantially in the form attached as Exhibit D or E.
"Purchase Agreement" means the Purchase Agreement, dated as of December 10,
1996, among the Trust, the Depositor and the Initial Purchasers named therein.
"Property Trustee" means the Person identified as the "Property Trustee" in
the preamble to this Trust Agreement solely in its capacity as Property Trustee
of the Trust heretofore formed and continued hereunder and not in its individual
capacity, or its successor in interest in such capacity, or any successor
property trustee appointed as herein provided.
"Redemption Date" means, with respect to any Trust Security to be redeemed,
the date fixed for such redemption by or pursuant to this Trust Agreement;
provided that each Debenture Redemption Date and the stated maturity of the
Debentures shall be a Redemption Date for a Like Amount of Trust Securities.
"Redemption Price" means, with respect to any Trust Security, the
Liquidation Amount of such Trust Security, plus accumulated and unpaid
Distributions to the Redemption Date, plus the related amount of the premium, if
any, paid by the Depositor upon the concurrent redemption of a Like Amount of
Debentures allocated on a pro rata basis (based on Liquidation Amounts) among
the Trust Securities.
"Regulation D" means Regulation D under the Securities Act (or any
successor provision), as it may be amended from time to time.
"Regulation S" means Regulation S under the Securities Act (or any
successor provision), as it may be amended from time to time.
"Regulation S Preferred Securities" means the Preferred Securities sold by
the Initial Purchasers in reliance on Regulation S, substantially in the form
set forth in Exhibit C-2.
"Regulation S Preferred Securities Legend" means a legend substantially in
the form of the legend required in Exhibit C-2 to be placed upon the Regulation
S Preferred Securities.
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"Regulation S Certificate" means a certificate substantially in the form
set forth in Exhibit D.
"Relevant Trustee" shall have the meaning specified in Section 8.10.
"Responsible Officer" means, when used with respect to the Property
Trustee, any officer assigned to the Corporate Trust Office, including any vice
president, assistant vice president, assistant treasurer, or any other officer
of the Property Trustee assigned by the Property Trustee to administer its
corporate trust matters.
"Restricted Period" means, with regard to any Preferred Security, the time
period for which a Preferred Security is required to bear a Securities Act
Legend pursuant to Regulation S of the Securities Act.
"Restricted Preferred Securities" means all Preferred Securities required
pursuant to Section 5.5(c) to bear a Restricted Preferred Securities Act Legend.
"Restricted Preferred Securities Legend" means a legend substantially in
the form of a Legend required on Exhibit E to be placed on non-global Definitive
Preferred Securities issued to Accredited Investors.
"Restricted Securities Certificate" means a certificate substantially in
the form set forth in Exhibit E.
"Rule 144A" means Rule 144A under the Securities Act.
"Rule 144A Preferred Securities" means the Preferred Securities sold by the
Initial Purchasers in reliance on Rule 144A, substantially in the form set forth
in Exhibit C-1.
"Rule 144A Preferred Securities Legend" means a legend substantially in the
form of the legend required in Exhibit C-1 to be placed upon the Rule 144A
Preferred Securities.
"Securities Act" means the United States Securities Act of 1933, as
amended.
"Securities Act Legend" means a Rule 144 Preferred Securities Legend or a
Regulation S Preferred Securities Legend.
"Securities Register" and "Securities Registrar" have the respective
meanings specified in Section 5.5.
"Securityholder" or "Holder" means a Person in whose name a Trust Security
or Trust Securities is registered in the Securities Register; any such Person
shall be deemed to be a beneficial owner within the meaning of the Delaware
Business Trust Act; provided, however, that in determining whether the Holders
of the requisite amount of Preferred Securities have voted on any matter
provided for in this Trust Agreement, then for the purpose of any such
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determination, so long as Definitive Preferred Securities certificates have not
been issued, the term Securityholders or Holders as used herein shall refer to
the Owners.
"Tax Event" means the receipt by the Trust of an Opinion of Counsel
experienced in such matters to the effect that, as a result of any amendment to,
or change (including any announced proposed change) in, the laws (or any
regulations thereunder) of the United States or any political subdivision or
taxing authority thereof or therein, or as a result of any official
administrative pronouncement or judicial decision interpreting or applying such
laws or regulations, which amendment or change is effective or which
pronouncement or decision is announced on or after the date of issuance of the
Preferred Securities under this Trust Agreement, there is more than an
insubstantial risk that (i) the Trust is, or will be within 90 days after the
date of such Opinion of Counsel, subject to United States federal income tax
with respect to income received or accrued on the Debentures, (ii) interest
payable by the Depositor on the Debentures is not, or within 90 days after the
date of such Opinion of Counsel, will not be, deductible by the Depositor, in
whole or in part, for United States federal income tax purposes or (iii) the
Trust is, or will be within 90 days after the date of such Opinion of Counsel,
subject to more than a de minimis amount of other taxes, duties, assessments or
other governmental charges.
"Trust" means the Delaware business trust created and continued hereby and
identified on the cover page to this Trust Agreement.
"Trust Agreement" means this Amended and Restated Trust Agreement, as the
same may be modified, amended or supplemented in accordance with the applicable
provisions hereof, including (i) all exhibits hereto and (ii) for all purposes
of this Trust Agreement and any such modification, amendment or supplement, the
provisions of the Trust Indenture Act that are deemed to be a part of and govern
this Trust Agreement and any such modification, amendment or supplement,
respectively.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in force at
the date as of which this instrument was executed; provided, however, that in
the event the Trust Indenture Act of 1939 is amended after such date, "Trust
Indenture Act" means, to the extent required by any such amendment, the Trust
Indenture Act of 1939 as so amended.
"Trust Property" means (a) the Debentures, (b) any cash on deposit in, or
owing to, the Payment Account and (c) all proceeds and rights in respect of the
foregoing and any other property and assets for the time being held or deemed to
be held by the Property Trustee pursuant to the trusts of this Trust Agreement.
"Trust Security" means any one of the Common Securities or the Preferred
Securities.
"Trust Securities Certificate" means any one of the Common Securities
Certificates or the Preferred Securities Certificates.
"Trustees" means, collectively, the Property Trustee, the Delaware Trustee
and the Administrative Trustees.
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"Unrestricted Securities Certificate" means a certificate substantially in
the form set forth in Exhibit F.
ARTICLE II.
Continuation of the Trust
Section 2.1. Name.
The Trust continued hereby shall be known as "Riggs Capital", as such name
may be modified from time to time by the Administrative Trustees following
written notice to the Holders of Trust Securities and the other Trustees, in
which name the Trustees engaged in the transactions contemplated hereby, make
and execute contracts and other instruments on behalf of the Trust and sue and
be sued.
Section 2.2. Office of the Delaware Trustee; Principal Place of Business.
The address of the Delaware Trustee in the State of Delaware is c/o The
Bank of New York (Delaware), White Clay Center, Route 273, Newark, Delaware
19711, Attention: Corporate Trust Administration, or such other address in the
State of Delaware as the Delaware Trustee may designate by written notice to the
Securityholders and the Depositor. The principal executive office of the Trust
is c/o Riggs National Corporation, 1503 Pennsylvania Avenue, N.W., Washington,
D.C. 20005.
Section 2.3. Initial Contribution of Trust Property; Organizational
Expenses.
The Property Trustee acknowledges receipt in trust from the Depositor in
connection with the Original Trust Agreement of the sum of $10, which
constituted the initial Trust Property. The Depositor shall pay organizational
expenses of the Trust as they arise or shall, upon request of any Trustee,
promptly reimburse such Trustee for any such expenses paid by such Trustee. The
Depositor shall make no claim upon the Trust Property for the payment of such
expenses.
Section 2.4. Issuance of the Preferred Securities.
On December 10, 1996 the Depositor, on behalf of the Trust and pursuant to
the Original Trust Agreement, executed and delivered the Purchase Agreement.
Contemporaneously with the execution and delivery of this Trust Agreement, an
Administrative Trustee, on behalf of the Trust, shall execute in accordance with
Section 5.2 and deliver to the Initial Purchasers named in the Purchase
Agreement, Preferred Securities certificates, registered as set forth in Section
5.2, in an aggregate amount of 150,000 Preferred Securities having an aggregate
Liquidation Amount of $150,000,000, against receipt of such aggregate purchase
price of such Preferred Securities of $150,000,000, which amount the
Administrative Trustee shall promptly deliver to the Property Trustee (the
"Original Preferred Securities"). The Original Preferred Securities shall
consist of Rule 144A Preferred Securities, Regulation S Preferred Securities and
Other Preferred Securities.
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Section 2.5. Issuance of the Common Securities; Subscription and Purchase
of Debentures.
Contemporaneously with the execution and delivery of this Trust Agreement,
an Administrative Trustee, on behalf of the Trust, shall execute in accordance
with Section 5.2 and deliver to the Depositor Common Securities Certificates,
registered in the name of the Depositor, in an aggregate amount of 4,640 Common
Securities having an aggregate Liquidation Amount of $4,640,000 against payment
by the Depositor of such amount, which amount such Administrative Trustee shall
promptly deliver to the Property Trustee. Contemporaneously therewith, an
Administrative Trustee, on behalf of the Trust, shall subscribe to and purchase
from the Depositor Debentures, registered in the name of the Trust and having an
aggregate principal amount equal to $154,640,000, and, in satisfaction of the
purchase price for such Debentures, the Property Trustee, on behalf of the
Trust, shall deliver to the Depositor the sum of $154,640,000 (being the sum of
the amounts delivered to the Property Trustee pursuant to (i) the second
sentence of Section 2.4 and (ii) the first sentence of this Section 2.5).
Section 2.6. Declaration of Trust.
The exclusive purposes and functions of the Trust are (a) to issue and sell
Trust Securities and use the proceeds from such sale to invest in the Debentures
and (b) to engage in those activities necessary or incidental thereto. The
Depositor hereby appoints the Trustees as trustees of the Trust, to have all the
rights, powers and duties to the extent set forth herein, and the Trustees
hereby accept such appointment. The Property Trustee hereby declares that it
will hold the Trust Property in trust upon and subject to the conditions set
forth herein for the benefit of the Trust and the Securityholders. The
Administrative Trustees shall have all rights, powers and duties set forth
herein and in accordance with applicable law with respect to accomplishing the
purposes of the Trust. The Delaware Trustee shall not be entitled to exercise
any powers, nor shall the Delaware Trustee have any of the duties and
responsibilities, of the Property Trustee or the Administrative Trustees set
forth herein. The Delaware Trustee shall be one of the Trustees of the Trust for
the sole and limited purpose of fulfilling the requirements of Section 3807 of
the Delaware Business Trust Act.
Section 2.7. Authorization to Enter into Certain Transactions.
(a) The Trustees shall conduct the affairs of the Trust in accordance with
the terms of this Trust Agreement. Subject to the limitations set forth in
paragraph (b) of this Section, and in accordance with the following provisions
(i) and (ii), the Trustees shall have the authority to enter into all
transactions and agreements determined by the Trustees to be appropriate in
exercising the authority, express or implied, otherwise granted to the Trustees
under this Trust Agreement, and to perform all acts in furtherance thereof,
including without limitation, the following:
(i) As among the Trustees, each Administrative Trustee shall have the
power and authority to act on behalf of the Trust with respect to the
following matters:
(A) the issuance and sale of the Trust Securities;
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(B) without the consent of any Person to cause the Trust to enter
into, and to execute, deliver and perform on behalf of the Trust, the
Expense Agreement, the Registration Rights Agreement and the
Certificate Depositary Agreement and such other agreements as may be
necessary or desirable in connection with the purposes and function of
the Trust;
(C) assisting, in connection with the Registration Rights
Agreement, in the registration of the Preferred Securities under the
Securities Act of 1933, as amended (including executing the
Registration Statement), and under state securities or blue sky laws,
and the qualification of this Trust Agreement as a trust indenture
under the Trust Indenture Act;
(D) assisting in the registration or listing of the Preferred
Securities on the New York Stock Exchange or such other trading
facilities or exchanges as shall be determined by the Depositor and
the registration of the Preferred Securities under the Securities
Exchange Act of 1934, as amended, and the preparation, executing and
filing of all periodic and other reports and other documents pursuant
to the foregoing;
(E) the sending of notices (other than notices of default) and
other information regarding the Trust Securities and the Debentures to
the Securityholders in accordance with this Trust Agreement;
(F) the appointment of a Paying Agent, authenticating agent and
Securities Registrar in accordance with this Trust Agreement;
(G) registering transfer of the Trust Securities in accordance
with this Trust Agreement;
(H) to the extent provided in this Trust Agreement, the winding
up of the affairs of and liquidation of the Trust and the preparation,
execution and filing of the certificate of cancellation with the
Secretary of State of the State of Delaware;
(I) unless otherwise determined by the Depositor, the Property
Trustee or the Administrative Trustees, or as otherwise required by
the Delaware Business Trust Act or the Trust Indenture Act, to execute
on behalf of the Trust (either acting alone or together with any or
all of the Administrative Trustees) any documents that the
Administrative Trustees have the power to execute pursuant to this
Trust Agreement;
(J) assisting in the designation of the Preferred Securities for
trading in the Private Offering, Resales and Trading through the
Automatic Linkages (PORTAL) system; and
(K) the taking of any action incidental to the foregoing as the
Trustees may from time to time determine is necessary or advisable to
give effect to the terms
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of this Trust Agreement for the benefit of the Securityholders
(without consideration of the effect of any such action on any
particular Securityholder).
(ii) As among the Trustees, the Property Trustee shall have the power,
duty and authority to act on behalf of the Trust with respect to the
following matters:
(A) the establishment of the Payment Account;
(B) the receipt of the Debentures;
(C) the collection of interest, principal (and premium, if any)
and any other payments made in respect of the Debentures in the
Payment Account;
(D) the distribution through the Paying Agent of amounts owed to
the Securityholders in respect of the Trust Securities;
(E) the exercise of all of the rights, powers and privileges of a
holder of the Debentures;
(F) the sending of notices of default and other information
regarding the Trust Securities and the Debentures to the
Securityholders in accordance with this Trust Agreement;
(G) the distribution of the Trust Property in accordance with the
terms of this Trust Agreement;
(H) to the extent provided in this Trust Agreement, the winding
up of the affairs of and liquidation of the Trust and the preparation,
execution and filing of the certificate of cancellation with the
Secretary of State of the State of Delaware;
(I) after an Event of Default (other than under paragraph (b),
(c), (d) or (e) of the definition of such term if such Event of
Default is by or with respect to the Property Trustee) the taking of
any ministerial action incidental to the foregoing as the Property
Trustee may from time to time determine is necessary or advisable to
give effect to the terms of this Trust Agreement and protect and
conserve the Trust Property for the benefit of the Securityholders
(without consideration of the effect of any such action on any
particular Securityholder); and
(J) except as otherwise provided in this Section 2.7(a)(ii), the
Property Trustee shall have none of the duties, liabilities, powers or
the authority of the Administrative Trustees set forth in Section
2.7(a)(i).
(b) So long as this Trust Agreement remains in effect, the Trust (or the
Trustees acting on behalf of the Trust) shall not undertake any business,
activities or transaction except as expressly provided herein or contemplated
hereby. In particular, the Trustees shall not (i) acquire any investments or
engage in any activities not authorized by this Trust Agreement, (ii) sell,
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assign, transfer, exchange, mortgage, pledge, set-off or otherwise dispose of
any of the Trust Property or interests therein, including to Securityholders,
except as expressly provided herein, (iii) take any action that would cause the
Trust to fail or cease to qualify as a "grantor trust" for United States federal
income tax purposes, (iv) incur any indebtedness for borrowed money or issue any
other debt or (v) take or consent to any action that would result in the
placement of a Lien on any of the Trust Property. The Administrative Trustees
shall defend all claims and demands of all Persons at any time claiming any Lien
on any of the Trust Property adverse to the interest of the Trust or the
Securityholders in their capacity as Securityholders.
(c) In connection with the issue and sale of the Preferred Securities, the
Depositor shall have the right and responsibility to assist the Trust with
respect to, or effect on behalf of the Trust, the following (and any actions
taken by the Depositor in furtherance of the following prior to the date of this
Trust Agreement are hereby ratified and confirmed in all respects):
(i) the preparation by the Trust of an Offering Memorandum in relation
to the Preferred Securities and the preparation and filing by the Trust
with the Commission and the execution on behalf of the Trust of a
registration statement on the appropriate form in relation to the Preferred
Securities, including any amendments thereto;
(ii) the determination of the States in which to take appropriate
action to qualify or register for sale all or part of the Preferred
Securities and the determination of any and all such acts, other than
actions which must be taken by or on behalf of the Trust, and the advice to
the Trustees of actions they must take on behalf of the Trust, and the
preparation for execution and filing of any documents to be executed and
filed by the Trust or on behalf of the Trust, as the Depositor deems
necessary or advisable in order to comply with the applicable laws of any
such States or other applicable jurisdictions in connection with the sale
of the Preferred Securities;
(iii) the preparation for filing by the Trust and execution on behalf
of the Trust of an application to The Depository Trust Company or any
trading facility or exchange for registration or listing upon notice of
issuance of any Preferred Securities;
(iv) the preparation for filing by the Trust with the Commission and
the execution on behalf of the Trust of a registration statement on Form 8-
A relating to the registration of the Preferred Securities under Section
12(b) or 12(g) of the Exchange Act, including any amendments thereto;
(v) the negotiation of the terms of, and the execution and delivery
of, the Registration Rights Agreement, the Purchase Agreement providing for
the sale of the Preferred Securities and the negotiation of the terms of
and execution and delivery of, on behalf of the Trust, the Purchase
Agreement and such other agreements as may be necessary or desirable in
connection with the consummation thereof; and
(vi) the taking of any other actions necessary or desirable to carry
out any of the foregoing activities.
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(d) Notwithstanding anything herein to the contrary, the Administrative
Trustees are authorized and directed to conduct the affairs of the Trust and to
operate the Trust so that the Trust will not be deemed to be an "investment
company" required to be registered under the 1940 Act, and will not be
classified as other than a grantor trust or as an association taxable as a
corporation for United States federal income tax purposes and so that the
Debentures will be treated as indebtedness of the Depositor for United States
Federal income tax purposes. In this connection, the Depositor and the
Administrative Trustees are authorized to take any action, not inconsistent with
applicable law, the Certificate of Trust or this Trust Agreement, that each of
the Depositor and any Administrative Trustee determines in its discretion to be
necessary or desirable for such purposes, as long as such action does not
adversely affect in any material respect the interests of the holders of the
Preferred Securities.
Section 2.8. Assets of Trust.
The assets of the Trust shall consist of the Trust Property.
Section 2.9. Title to Trust Property.
Legal title to all Trust Property shall be vested at all times in the
Property Trustee (in its capacity as such) and shall be held and administered by
the Property Trustee for the benefit of the Trust and the Securityholders in
accordance with this Trust Agreement.
ARTICLE III.
Payment Account
Section 3.1. Payment Account.
(a) On or prior to the Closing Time, the Property Trustee shall establish
the Payment Account. The Property Trustee and any agent of the Property Trustee
shall have exclusive control and sole right of withdrawal with respect to the
Payment Account for the purpose of making deposits in and withdrawals from the
Payment Account in accordance with this Trust Agreement. All moneys and other
property deposited or held from time to time in the Payment Account shall be
held by the Property Trustee in the Payment Account for the exclusive benefit of
the Securityholders and for distribution as herein provided, including (and
subject to) any priority of payments provided for herein.
(b) The Property Trustee shall deposit in the Payment Account, promptly
upon receipt, all payments of principal of, premium (if any) or interest on, and
any other payments or proceeds with respect to, the Debentures. Amounts held in
the Payment Account shall not be invested by the Property Trustee pending
distribution thereof.
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ARTICLE IV.
Distributions; Redemption
Section 4.1. Distributions.
(a) The Trust Securities represent undivided beneficial interests in the
Trust Property, and Distributions (including Additional Amounts) will be made on
the Trust Securities at the rate and on the dates that payments of interest
(including of Additional Interest, as defined in the Indenture) are made on the
Debentures. Accordingly:
(i) Distributions on the Trust Securities shall be cumulative, and
will accumulate whether or not there are funds of the Trust available for
the payment of Distributions. Distributions shall accrue from December 13,
1996 and, except in the event (and to the extent) that the Depositor
exercises its right to defer the payment of interest on the Debentures
pursuant to the Indenture, shall be payable semi-annually in arrears on
June 30 and December 31 of each year, commencing on June 30, 1997. If any
date on which a Distribution is otherwise payable on the Trust Securities
is not a Business Day, then the payment of such Distribution shall be made
on the next succeeding day that is a Business Day (and without any interest
or other payment in respect of any such delay) except that, if such
Business Day is in the next succeeding calendar year, payment of such
Distribution shall be made on the immediately preceding Business Day, in
each case with the same force and effect as if made on such date (each date
on which distributions are payable in accordance with this Section 4.1(a),
a "Distribution Date").
(ii) Assuming payments of interest on the Debentures are made when due
(and before giving effect to Additional Amounts, if applicable), the Trust
Securities shall be entitled to Distributions payable at a rate of 8 5/8%
per annum of the Liquidation Amount of the Trust Securities. The amount of
Distributions payable for any full semi-annual period shall be computed on
the basis of a 360-day year of twelve 30-day months. The amount of
Distributions for any partial period shall be computed on the basis of the
number of days elapsed in a 360-day year of twelve 30-day months. The
amount of Distributions payable for any period shall include the Additional
Amounts, if any.
(iii) Distributions on the Trust Securities shall be made by the
Property Trustee from the Payment Account and shall be payable on each
Distribution Date only to the extent that the Trust has funds then on hand
and immediately available in the Payment Account for the payment of such
Distributions.
(b) Distributions on the Trust Securities with respect to a Distribution
Date shall be payable to the Holders thereof as they appear on the Securities
Register for the Trust Securities on the relevant record date, which shall be,
for so long as the Preferred Securities remain in book-entry-only form, one
Business Day prior to such Distribution Date; provided, however, that in the
event that the Preferred Securities are not in book-entry-only form, the
relevant record date shall be the June 15 and December 15 next preceding the
relevant Distribution Date.
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Section 4.2. Redemption.
(a) On any Debenture Redemption Date and on the stated maturity of the
Debentures, the Trust will be required to redeem a Like Amount of Trust
Securities at the Redemption Price.
(b) Notice of redemption shall be given by the Property Trustee by first-
class mail, postage prepaid, mailed not less than 30 nor more than 60 days prior
to the Redemption Date to each Holder of Trust Securities to be redeemed, at
such Holder's address appearing in the Security Register. All notices of
redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price;
(iii) the CUSIP number;
(iv) if less than all the Outstanding Trust Securities are to be
redeemed, the identification and the total Liquidation Amount of the
particular Trust Securities to be redeemed; and
(v) that on the Redemption Date the Redemption Price will become due
and payable upon each such Trust Security to be redeemed and that
Distributions thereon will cease to accrue on and after said date.
(vi) the place or places where the Trust Securities are to be
surrendered for the payment of the Redemption Price.
The Trust in issuing the Trust Securities may use "CUSIP" or "private
placement" numbers (if then generally in use), and, if so, the Property Trustee
shall indicate the "CUSIP" or "private placement" numbers of the Trust
Securities in notices of redemption and related materials as a convenience to
Securityholders; provided that any such notice may state that no representation
is made as to the correctness of such numbers either as printed on the Trust
Securities or as contained in any notice of redemption and related materials.
(c) The Trust Securities redeemed on each Redemption Date shall be redeemed
at the Redemption Price with the proceeds from the contemporaneous redemption of
Debentures. Redemptions of the Trust Securities shall be made and the Redemption
Price shall be payable on each Redemption Date only to the extent that the Trust
has funds then on hand and immediately available in the Payment Account for the
payment of such Redemption Price.
(d) If the Property Trustee gives a notice of redemption in respect of any
Preferred Securities, then, by 12:00 noon, New York City time, on the Redemption
Date, subject to Section 4.2(c), the Property Trustee will, so long as the
Preferred Securities are in book-entry-only form, irrevocably deposit with the
Clearing Agency for the Preferred Securities funds sufficient to pay the
applicable Redemption Price and will give such Clearing Agency irrevocable
instructions and authority to pay the Redemption Price to the holders thereof.
If any Preferred Securities are held
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in certificated form, the Property Trustee, subject to Section 4.2(c), will
irrevocably deposit with the Paying Agent funds sufficient to pay the applicable
Redemption Price and will give the Paying Agent irrevocable instructions and
authority to pay the Redemption Price to the Holders thereof upon surrender of
their Preferred Securities Certificates. Notwithstanding the foregoing,
Distributions payable on or prior to the Redemption Date for any Trust
Securities called for redemption shall be payable to the Holders of such Trust
Securities as they appear on the Register for the Trust Securities on the
relevant record dates for the related Distribution Dates. If notice of
redemption shall have been given and funds deposited as required, then upon the
date of such deposit, all rights of Securityholders holding Trust Securities so
called for redemption will cease, except the right of such Securityholders to
receive the Redemption Price and any Distribution payable on or prior to the
Redemption Date, but without interest, and such Securities will cease to be
outstanding. In the event that any date on which any Redemption Price is payable
is not a Business Day, then payment of the Redemption Price payable on such date
will be made on the next succeeding day that is a Business Day (and without any
interest or other payment in respect of any such delay), except that, if such
Business Day falls in the next calendar year, such payment will be made on the
immediately preceding Business Day, in each case, with the same force and effect
as if made on such date. In the event that payment of the Redemption Price in
respect of any Trust Securities called for redemption is improperly withheld or
refused and not paid either by the Trust or by the Depositor pursuant to the
Guarantee, Distributions on such Trust Securities will continue to accrue, at
the then applicable rate, from the Redemption Date originally established by the
Trust for such Trust Securities to the date such Redemption Price is actually
paid, in which case the actual payment date will be the date fixed for
redemption for purposes of calculating the Redemption Price.
(e) Payment of the Redemption Price on the Trust Securities shall be made
to the recordholders thereof as they appear on the Securities Register for the
Trust Securities on the relevant record date, which, for so long as the
Preferred Securities are in book-entry-only form, shall be one Business Day
prior to the relevant Redemption Date; provided, however, that in the event that
the Preferred Securities are not in book-entry-only form, the relevant record
date shall be the date fifteen days prior to the relevant Redemption Date.
(f) Subject to Section 4.3(a), if less than all the Outstanding Trust
Securities are to be redeemed on a Redemption Date, then the aggregate
Liquidation Amount of Trust Securities to be redeemed shall be allocated on a
pro rata basis (based on Liquidation Amounts) (currently allocated approximately
3% to Common Securities and 97% to Preferred Securities) among the Common
Securities and the Preferred Securities. The particular Preferred Securities to
be redeemed shall be selected on a pro rata basis (based upon Liquidation
Amounts) not more than 60 days prior to the Redemption Date by the Property
Trustee from the Outstanding Preferred Securities not previously called for
redemption, by such method (including, without limitation, by lot) as the
Property Trustee shall deem fair and appropriate and which may provide for the
selection for redemption of portions (equal to $1,000 or integral multiples of
$1,000 in excess thereof) of the Liquidation Amount of Preferred Securities of a
denomination larger than $1,000. The Property Trustee shall promptly notify the
Security Registrar in writing of the Preferred Securities selected for
redemption and, in the case of any Preferred Securities selected for partial
redemption, the Liquidation Amount thereof to be redeemed. For all purposes of
this Trust Agreement, unless the context otherwise requires, all provisions
relating to the redemption of
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Preferred Securities shall relate, in the case of any Preferred Securities
redeemed or to be redeemed only in part, to the portion of the Liquidation
Amount of Preferred Securities which has been or is to be redeemed.
Section 4.3. Subordination of Common Securities.
(a) Payment of Distributions (including Additional Amounts, if applicable)
on, and the Redemption Price of, the Trust Securities, as applicable, shall be
made, subject to Section 4.2(f), pro rata among the Common Securities and the
Preferred Securities based on the Liquidation Amount of the Trust Securities;
provided, however, that if on any Distribution Date or Redemption Date any Event
of Default resulting from a Debenture Event of Default shall have occurred and
be continuing, no payment of any Distribution (including Additional Amounts, if
applicable) on, or Redemption Price of, any Common Security, and no other
payment on account of the redemption, liquidation or other acquisition of Common
Securities shall be made unless payment in full in cash of all accumulated and
unpaid Distributions (including Additional Amounts, if applicable) on all
Outstanding Preferred Securities for all Distribution periods terminating on or
prior thereto, or in the case of payment of the Redemption Price the full amount
of such Redemption Price on all Outstanding Preferred Securities then called for
redemption, shall have been made or provided for, and all funds immediately
available to the Property Trustee shall first be applied to the payment in full
in cash of all Distributions (including Additional Amounts, if applicable) on,
or the Redemption Price of, Preferred Securities then due and payable.
(b) In the case of the occurrence of any Event of Default resulting from
any Debenture Event of Default, the Holder of Common Securities will be deemed
to have waived any right to act with respect to any such Event of Default under
this Trust Agreement until the effect of all such Events of Default with respect
to the Preferred Securities have been cured, waived or otherwise eliminated.
Until any such Event of Default under this Trust Agreement with respect to the
Preferred Securities has been so cured, waived or otherwise eliminated, the
Property Trustee shall act solely on behalf of the Holders of the Preferred
Securities and not the Holder of the Common Securities, and only the Holders of
the Preferred Securities will have the right to direct the Property Trustee to
act on their behalf.
Section 4.4. Payment Procedures.
Payments of Distributions (including Additional Amounts, if applicable) in
respect of the Preferred Securities which are not held by a Clearing Agency
shall be made by check mailed to the address of the Person entitled thereto as
such address shall appear on the Securities Register or, if the Preferred
Securities are held by a Clearing Agency, such Distributions shall be made by
wire to the Clearing Agency in immediately available funds, which shall credit
the relevant Persons' accounts at such Clearing Agency on the applicable
Distribution Dates. Payments in respect of the Common Securities shall be made
in such manner as shall be mutually agreed between the Property Trustee and the
Common Securityholder.
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Section 4.5. Tax Returns and Reports.
The Administrative Trustees shall prepare (or cause to be prepared), at the
Depositor's expense, and file all United States federal, state and local tax and
information returns and reports required to be filed by or in respect of the
Trust. In this regard, the Administrative Trustees shall (a) prepare and file
(or cause to be prepared and filed) the appropriate Internal Revenue Service
Form required to be filed in respect of the Trust in each taxable year of the
Trust and (b) prepare and furnish (or cause to be prepared and furnished) to
each Securityholder the appropriate Internal Revenue Service form required to be
provided on such form. The Administrative Trustees shall provide the Depositor
with a copy of all such returns and reports promptly after such filing or
furnishing. The Trustees shall comply with United States federal withholding and
backup withholding tax laws and information reporting requirements with respect
to any payments to Securityholders under the Trust Securities.
Section 4.6. Payment of Taxes, Duties, Etc. of the Trust.
Upon receipt under the Debentures of Additional Sums, the Property Trustee,
at the direction of an Administrative Trustee or the Depositor, shall promptly
pay any taxes, duties or governmental charges of whatsoever nature (other than
withholding taxes) imposed on the Trust by the United States or any other taxing
authority.
Section 4.7. Payments under Indenture or Pursuant to Direct Actions.
Any amount payable hereunder to any Holder of Preferred Securities shall be
reduced by the amount of any corresponding payment such Holder has directly
received pursuant to Section 5.8 of the Indenture or Section 5.14 of this Trust
Agreement.
Section 4.8. Liability for Debts and Obligations of the Trust
Any Holder of the Common Securities shall be liable for the debts and
obligations of the Trust in the manner and to the extent set forth with respect
to the Common Securityholder (as defined in the Expense Agreement) and agrees
that it shall be subject to all liabilities to which the Common Securityholder
may be subject, and shall make all payments that the Common Securityholder is
required to make, under the terms of the Expense Agreement.
ARTICLE V.
Trust Securities
Section 5.1. Initial Ownership.
Upon the formation of the Trust and the contribution by the Depositor
pursuant to Section 2.3 and until the issuance of the Trust Securities, and at
any time during which no Trust Securities are outstanding, the Depositor shall
be the sole beneficial owner of the Trust.
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Section 5.2. The Preferred Securities.
The Preferred Securities shall be issued in minimum denominations of
$100,000 Liquidation Amount and integral multiples of $1,000 in excess thereof,
and the Common Securities shall be issued in denominations of $1,000 Liquidation
Amount and integral multiples thereof. The Trust Securities shall be executed on
behalf of the Trust by manual or facsimile signature of at least one
Administrative Trustee. Trust Securities bearing the manual or facsimile
signatures of individuals who were, at the time when such signatures shall have
been affixed, authorized to sign on behalf of the Trust, shall be validly issued
and entitled to the benefits of this Trust Agreement, notwithstanding that such
individuals or any of them shall have ceased to be so authorized prior to the
delivery of such Trust Securities or did not hold such offices at the date of
delivery of such Trust Securities. A transferee of a Trust Security shall become
a Securityholder, and shall be entitled to the rights and subject to the
obligations of a Securityholder hereunder, upon due registration of such Trust
Securities in such transferee's name pursuant to Sections 5.4, 5.5 and 5.13.
Upon their original issuance, Rule 144A Preferred Securities shall be
issued in the form of one or more Global Rule 144A Preferred Security registered
in the name of the nominee of DTC for credit to the respective accounts of the
Owners thereof (or such other accounts as they may direct). Upon their original
issuance, Regulation S Preferred Securities shall be issued in the form of one
or more Global Regulation S Preferred Security registered in the name of the
nominee of DTC for credit to the respective accounts of the beneficial Owners of
the Preferred Securities represented thereby (or such other accounts as they may
direct), provided that upon deposit all such Regulation S Preferred Securities
shall be credited to or through accounts maintained at DTC by or on behalf of
Euroclear or Cedel. Upon their original issuance, Other Preferred Securities
shall not be issued in the form of Global Preferred Securities or in any other
form intended to facilitate global trading in beneficial interests in such
Preferred Securities but shall be issued to the Accredited Investor in the form
of a Definitive Preferred Security certificate and registered in the name of the
Accredited Investor thereof.
A single Common Securities certificate representing the Common Securities
shall be issued to the Depositor in the form of a definitive Common Securities
certificate.
Section 5.3. Execution and Delivery of Trust Securities.
At the Closing Time, the Administrative Trustees shall cause Trust
Securities consisting of Preferred Securities and Common Securities, in an
aggregate Liquidation Amount as provided in Sections 2.4 and 2.5, to be executed
on behalf of the Trust by at least one Administrative Trustee and delivered to
or upon the written order of the Depositor, signed by its chairman of the board,
its president, any executive vice president or any vice president, treasurer or
assistant treasurer or controller without further corporate action by the
Depositor, in authorized denominations.
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Section 5.4. Global Preferred Securities.
(a) Each Global Preferred Security issued under this Trust Agreement shall
be registered in the name of the Clearing Agency designated by the Depositor for
the related Global Preferred Securities or a nominee thereof and delivered to
such Clearing Agency or a nominee thereof or custodian therefor.
(b) Notwithstanding any other provision in this Trust Agreement, no Global
Preferred Securities may be exchanged in whole or in part for Definitive
Preferred Securities registered, and no transfer of Global Preferred Securities
in whole or in part may be registered, in the name of any Person other than the
Clearing Agency for such Global Preferred Securities or a nominee or custodian
thereof unless (a) the Clearing Agency advises the Property Trustee in writing
that the Clearing Agency is no longer willing or able to properly discharge its
responsibilities with respect to the Global Preferred Securities, and the
Depositor or Administrative Trustee fails to appoint a qualified successor
within 90 days of such notice, (b) the Depositor at its option advises the
Clearing Agency in writing that it elects to terminate the global system through
the Clearing Agency, (c) a Debenture Event of Default has occurred and is
continuing or (d) pursuant to the following sentence. All or any portion of a
Global Preferred Security may be exchanged for a Definitive Preferred Security
that has a like aggregate Liquidation Amount and is not a Global Preferred
Security upon at least 20 days' prior written notice made by the Clearing Agency
or its authorized representative to the Property Trustee; provided, however,
that no Definitive Preferred Security shall be issued in an amount representing
less than $100,000 in aggregate Liquidation Amount of Preferred Securities.
Upon the occurrence of any event specified in clause (a), (b) or (c) above, the
Administrative Trustees shall notify the Clearing Agency and the Clearing Agency
shall notify all Owners of beneficial interests in Global Preferred Securities,
the Property Trustee and the Administrative Trustees of the occurrence of such
event and of the availability of the Definitive Preferred Securities to such
Owners requesting the same; provided, however, that no Definitive Preferred
Securities shall be issued in an amount representing less than $100,000 in
aggregate Liquidation Amount of Preferred Securities. Upon surrender to the
Administrative Trustees of the typewritten Preferred Securities certificate or
certificates representing the Global Preferred Securities held by the Clearing
Agency, accompanied by registration instructions, the Administrative Trustees,
or any one of them, shall execute a Definitive Preferred Security in accordance
with the instructions of the Clearing Agency. Neither the Securities Registrar
nor the Trustees shall be liable for any delay in delivery of such instructions
and may conclusively rely on, and shall be protected in relying on, such
instructions. Upon the issuance of the Definitive Preferred Security, the
Trustees shall recognize the Holder of a Definitive Preferred Security as a
Securityholder. Definitive Preferred Securities shall be printed, lithographed
or engraved or may be produced in any other manner as is reasonably acceptable
to the Administrative Trustees, as evidenced by the execution thereof by the
Administrative Trustees or any one of them.
(c) If any Global Preferred Security is to be exchanged for Definitive
Preferred Securities or cancelled in part, or if Definitive Preferred Securities
are to be exchanged in whole or in part for a Global Preferred Security, then
either (i) such Global Preferred Security shall be so surrendered for exchange
or cancellation as provided in this Article Five or (ii) the aggregate
Liquidation Amount represented by such Global Preferred Security shall be
reduced, subject to
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Section 5.2, or increased, by an amount equal to the Liquidation Amount
represented by that portion of the Global Preferred Security to be so exchanged
or cancelled, or equal to the Liquidation Amount represented by such Definitive
Preferred Security to be so exchanged for beneficial interests in the Global
Preferred Security represented thereby, as the case may be, by means of an
appropriate adjustment made on the records of the Securities Registrar,
whereupon the Property Trustee, in accordance with the Applicable Procedures,
shall instruct the Clearing Agency or its authorized representative to make a
corresponding adjustment to its records. Upon surrender to the Administrative
Trustees or the Securities Registrar of the Global Preferred Security by the
Clearing Agency, accompanied by registration instructions, the Administrative
Trustees, or any one of them, shall execute the Definitive Preferred Securities
in accordance with the instructions of the Clearing Agency; provided, however,
that no Definitive Preferred Securities shall be issued in an amount
representing less than $100,000 in aggregate Liquidation Amount of Preferred
Securities. None of the Securities Registrar, the Trustees or the Administrative
Trustees shall be liable for any delay in delivery of such instructions and may
conclusively rely on, and shall be protected in relying on, such instructions.
Upon the issuance of Definitive Preferred Securities, the Trustees and
Administrative Trustees shall recognize the Holders of the Definitive Preferred
Securities as Securityholders. The Definitive Preferred Securities shall be
printed, lithographed or engraved or may be produced in any other manner as is
reasonably acceptable to the Administrative Trustees, as evidenced by the
execution thereof by the Administrative Trustees or any one of them.
(d) Every Definitive Preferred Security executed and delivered upon
registration of, transfer of, or in exchange for or in lieu of, a Global
Preferred Security or any portion thereof, whether pursuant to this Article Five
or otherwise, shall be executed and delivered in the form of, and shall be, a
Global Preferred Security, unless such Definitive Preferred Security is
registered in the name of a Person other than the Clearing Agency for such
Global Preferred Security or a nominee thereof.
(e) In the event of the occurrence of the events specified in Section 5.13,
the Trust will promptly make available to the Property Trustee a reasonable
supply of certificated Securities in definite, fully registered form without
interest coupons.
(f) The Clearing Agency or its nominee, as registered owner of a Global
Preferred Security, shall be the Holder of such Global Preferred Security for
all purposes under this Agreement and the Global Preferred Security, and Owners
with respect to a Global Preferred Security shall hold such interests pursuant
to the Applicable Procedures. The Securities Registrar and the Trustees shall
be entitled to deal with the Clearing Agency for all purposes of this Trust
Agreement relating to the Global Preferred Securities (including the payment of
the Liquidation Amount of and Distributions on the beneficial interests in
Global Preferred Securities represented thereby and the giving of instructions
or directions to Owners of Global Preferred Securities represented thereby) as
the sole Holder of the Global Preferred Securities represented thereby and shall
have no obligations to the Owners thereof. Neither the Property Trustee nor the
Securities Registrar shall have any liability in respect of any transfers
effected by the Clearing Agency and in no event shall the Clearing Agency be
deemed an agent of the Property Trustee or the Securities Registrar.
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The rights of the Owners of the Global Preferred Securities shall be
exercised only through the Clearing Agency and shall be limited to those
established by law, the Applicable Procedures and agreements between such Owners
and the Clearing Agency and/or the Clearing Agency Participants. Pursuant to the
Certificate Depositary Agreement, unless and until Definitive Preferred
Securities are issued pursuant to Section 5.4(b), the initial Clearing Agency
will make global transfers among the Clearing Agency Participants and receive
and transmit payments on the Preferred Securities to such Clearing Agency
Participants.
Section 5.5. Registration, Registration of Transfer and Exchange of
Preferred Securities generally; Certain Transfer and Exchanges; Securities Act
Legends.
(a) Registration, Registration of Transfer and Exchange Generally. The
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Property Trustee shall keep or cause to be kept, at the office or agency
maintained pursuant to Section 5.9, a register or registers for the purpose of
registering Trust Securities and transfers and exchanges of Preferred Securities
(the "Securities Register") in which, the registrar designated by the Depositor
(the "Securities Registrar"), subject to such reasonable regulations as it may
prescribe, shall provide for the registration of Preferred Securities and
registration of transfers and exchanges of Preferred Securities as herein
provided. The Bank shall be the initial Securities Registrar.
Upon surrender for registration of transfer of any Preferred Security at
the office or agency maintained pursuant to Section 5.9, the Administrative
Trustees or any one of them shall execute and the Property Trustee shall
deliver, in the name of the designated transferee or transferees, one or more
new Preferred Securities in authorized denominations of a like aggregate
Liquidation Amount dated the date of execution by such Administrative Trustee or
Trustees.
The Securities Registrar shall not be required to register the transfer of
any Preferred Securities that have been called for redemption.
At the option of a Holder, Preferred Securities may be exchanged for other
Preferred Securities in authorized denominations of the same class and of a like
aggregate Liquidation Amount upon surrender of the Preferred Securities to be
exchanged at the office or agency maintained pursuant to Section 5.9.
Every Preferred Security presented or surrendered for registration of
transfer or exchange shall be accompanied by a written instrument of transfer in
form satisfactory to an Administrative Trustee and the Securities Registrar duly
executed by the Holder or his attorney duly authorized in writing. Each
Preferred Security surrendered for registration of transfer or exchange shall be
cancelled and subsequently disposed of by an Administrative Trustee in
accordance with such Person's customary practice.
The Trust and the Securities Registrar, as applicable, shall not be
required to (i) issue, register the transfer of, or exchange any Preferred
Securities during a period beginning at the opening of business 15 calendar days
before the day of mailing of a notice of redemption of any Preferred Securities
called for redemption and ending at the close of business on the day of such
mailing or (ii) register the transfer of or exchange any Preferred Securities so
selected for
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redemption, in whole or in part, except the unredeemed portion of any such
Preferred Securities being redeemed in part.
No service charge shall be made for any registration of transfer or
exchange of Preferred Securities, but the Securities Registrar may require
payment of a sum sufficient to cover any tax or governmental charge that may be
imposed in connection with any transfer or exchange of Preferred Securities.
(b) Certain Transfers and Exchanges. Notwithstanding any other provision
-------------------------------
of this Trust Agreement, transfers and exchanges of Preferred Securities and of
beneficial interests in a Global Security of the kinds specified in this Section
5.5(b) shall be made only in accordance with this Section 5.5(b).
(i) Exchanges Between Global Regulation S Preferred Securities and
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Global Rule 144 Preferred Securities. If an Owner of a beneficial interest
------------------------------------
in a Global Regulation S Preferred Security wishes at any time to transfer
such interest to a Person who wishes to acquire the same in the form of a
beneficial interest in a Global Rule 144A Preferred Security, such transfer
may be effected only in accordance with this Clause (b)(i) and subject to
the Applicable Procedures. Upon receipt by the Securities Registrar of (A)
an order given by the Clearing Agency or its authorized representative
directing that interests in a Global Rule 144A Preferred Security in a
specified amount be credited to a specified Clearing Agency Participant's
account and that interests in a Global Regulation S Preferred Security in
an equal amount be debited from another specified Clearing Agency
Participant's account and (B) if such transfer is to occur during the
Restricted Period, a Restricted Securities Certificate (substantially in
the form of Exhibit E hereto) satisfactory to the Securities Registrar and
duly executed by the Owner of such a beneficial interest in the Global
Regulation S Preferred Security or his attorney duly authorized in writing,
then the Securities Registrar shall reduce the amount of the Global
Regulation S Preferred Security by such specified amount and increase the
amount of the Global Rule 144A Preferred Security by a corresponding
amount.
If an Owner of a beneficial interest in a Global Rule 144A Preferred
Security at any time wishes to transfer such interest to a Person who
wishes to acquire the same in the form of a beneficial interest in a Global
Regulation S Preferred Security, such transfer may be effected only in
accordance with the provisions of this Clause (b)(i) and subject to the
Applicable Procedures. Upon receipt by the Securities Registrar of (A) an
order given by the Clearing Agency or its authorized representative
directing that interests in a Global Regulation S Preferred Security in a
specified amount be credited to a specified Clearing Agency Participant's
account and that interests in a Global Rule 144A Preferred Security in an
equal amount be debited from another specified Clearing Agency
Participant's account and (B) a Regulation S Certificate (substantially in
the form of Exhibit D hereto) satisfactory to the Securities Registrar and
duly executed by the Owner of such interests in a Global Rule 144A
Preferred Security or his attorney duly authorized in writing, then the
Securities Registrar shall, as directed by the Clearing Agency, reduce the
amount of the Global Rule 144A Preferred Security and increase the amount
of the Global Regulation S Preferred Security by a corresponding amount.
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(ii) Exchange of Global Rule 144A Preferred Securities or Global
-----------------------------------------------------------
Regulation S Preferred Securities for Other Preferred Securities. An Owner
----------------------------------------------------------------
of a beneficial interest in a Global Rule 144A Preferred Security or a
Global Regulation S Preferred Security at any time may, but only upon at
least 20 days' prior written notice given by the Clearing Agency to the
Property Trustee, transfer such interest to a Person who wishes to acquire
the same in the form of an Other Preferred Security, provided that the
Securities Registrar shall have received a Restricted Securities
Certificate (substantially in the form of Exhibit E hereto) satisfactory to
the Securities Registrar and duly executed by the transferor Owner or his
attorney duly authorized in writing.
(iii) Exchange of Other Preferred Securities for Global 144A Preferred
----------------------------------------------------------------
Securities or Global Regulation S Securities. If an Owner of an Other
--------------------------------------------
Preferred Security wishes at any time to transfer all or any portion of
such Other Preferred Security to a Person who wishes to take delivery
thereof in the form of a beneficial interest in a Global 144A Preferred
Security or a Global Regulation S Preferred Security, such transfer may be
effected only in accordance with the provisions of this Clause (b)(iii) and
Clause (b)(iv) below and subject to the Applicable Procedures. Upon
receipt by the Property Trustee, as Securities Registrar of (A) a
Restricted Securities Certificate and written instructions satisfactory to
the Securities Registrar directing that a beneficial interest in the Global
144A Preferred Security or Global Regulation S Preferred Security in a
specified principal amount be credited to a specified Agent Member's
account and (B) a Restricted Securities Certificate (substantially in the
form of Exhibit E hereto), if the specified account is to be credited with
a beneficial interest in the Global 144A Preferred Security or a Regulation
S Certificate (substantially in the form of Exhibit D hereto), if the
specified account is to be credited with a beneficial interest in the
Global Regulation S Preferred Security, in either case satisfactory to the
Securities Registrar and duly executed by such Owner or his attorney duly
authorized in writing, then the Securities Registrar, subject to Clause
(b)(iv) below, shall cancel such Other Preferred Securities (and issue a
new Other Preferred Security in respect of any untransferred portion
thereof) as provided in Section 5.5(a) and increase the principal amount of
the Global 144A Preferred Security or the Global Regulation S Preferred
Security, as the case may be, by the specified principal amount as provided
in Section 5.5(c).
(iv) Global Regulation S Preferred Security to be Held Through Euroclear
-------------------------------------------------------------------
or Cedel during Restricted Period. The Property Trustee shall use its best
---------------------------------
efforts to cause the Clearing Agency to ensure that, until the expiration
of the Restricted Period, beneficial interests in a Global Regulation S
Preferred Security may be held only in or through accounts maintained at
the Clearing Agency by Euroclear or Cedel (or by Clearing Agency
Participants acting for the account thereof), and no Person shall be
entitled to effect any transfer or exchange that would result in any such
interest being held otherwise than in or through such an account; provided
that this Clause (b)(iv) shall not prohibit any transfer or exchange of
such an interest in accordance with Clause (b)(ii) above.
(v) Certain Initial Transfers of Other Preferred Securities. An initial
-------------------------------------------------------
transfer or exchange of Other Preferred Securities that does not involve
any change in beneficial ownership
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may be made to an Accredited Investor or Investors as if such transfer or
exchange were not a transfer or exchange, provided that a written
certification is provided to the Securities Registrar certifying that such
exchange or transfer does not involve a change in beneficial ownership.
(vi) Limitations Relating to Size of Blocks. Notwithstanding any other
--------------------------------------
provision of this Trust Agreement, Preferred Securities may only be issued,
transferred or exchanged in blocks representing not less than $100,000 in
aggregate Liquidation Amount of Preferred Securities. Any transfer,
exchange or other disposition of Preferred Securities in contravention of
this Section 5.5(b)(vi) shall be deemed to be void and of no legal effect
whatsoever, any such transferee shall be deemed not to be the Holder or
Owner of such Preferred Security for any purpose, including but not limited
to the receipt of distributions on such Preferred Securities, and such
transferee shall be deemed to have no interest whatsoever in such Preferred
Securities.
(c) Securities Act Legends. Global Rule 144A Preferred Securities and
----------------------
their successor Rule 144A Preferred Securities shall bear a Rule 144A Preferred
Securities Legend. Global Regulation S Preferred Securities and their successor
Regulation S Preferred Securities shall bear a Regulation S Preferred Securities
Legend. Other Preferred Securities and their successor Other Preferred
Securities shall bear an Other Preferred Securities Legend, and subject to the
following:
(i) subject to the following Clauses of this Section 5.5(c), Preferred
Securities that are exchanged, upon transfer or otherwise, for interests in
a Global Preferred Security or any portion thereof shall bear the
Securities Act Legend borne by such Global Preferred Security while
represented thereby;
(ii) any Preferred Securities which are sold or otherwise disposed of
pursuant to an effective registration statement under the Securities Act
(including the Registration Statement contemplated by the Registration
Rights Agreement), together with their successor Preferred Securities,
shall not be required to bear any legend; the Depositor or an
Administrative Trustee shall inform the Property Trustee in writing of the
effective date of any such registration statement registering Securities
under the Securities Act and shall notify the Property Trustee at any time
when prospectuses may be delivered with respect to Preferred Securities to
be sold pursuant to such registration statement and when the legends may be
removed. The Property Trustee shall not be liable for any action taken or
omitted to be taken by it in good faith in accordance with the applicable
instructions;
(iii) after December 13, 1999, new Preferred Securities (other than a
Global Preferred Security) that do not bear a Restricted Preferred
Securities Act Legend shall be issued in exchange for or in lieu of Other
Preferred Securities or any portions thereof if the Property Trustee has
received an Unrestricted Securities Certificate, in the form of Exhibit F
hereto, duly executed by the Holder or Owner of such Other Preferred
Securities or his attorney duly authorized in writing, and after such date
and receipt of such certificate, the Administrative Trustees shall execute
and deliver such new Preferred
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Securities in exchange for or in lieu of such Other Preferred Securities as
provided in this Article Five,
(iv) at any time after the Preferred Securities may be freely transferred
without registration under the Securities Act or without being subject to
transfer restrictions pursuant to the Securities Act, new Preferred
Securities that do not bear a legend may be issued in exchange for or in
lieu of a Preferred Security (other than a Global Preferred Security) or
any portion thereof which bears such a legend if the Security Registrar has
received an Unrestricted Securities Certificate and an opinion of
nationally recognized counsel, satisfactory to the Security Registrar and
duly executed by the Holder of such legended Preferred Securities or his
attorney duly authorized in writing;
(v) new Preferred Securities that do not bear a legend may be issued in
exchange for or in lieu of Preferred Securities (other than Global
Preferred Securities) or any portion thereof that bear such a legend if, in
the Property Trustee's judgment, placing such a legend upon such new
Preferred Securities is not necessary to ensure compliance with the
registration requirements of the Securities Act; and
(vi) notwithstanding the foregoing provisions of this Section 5.5(c), a
successor Preferred Security that does not bear a particular legend shall
not be required to bear such legend unless the Property Trustee has been
informed by the Depositor or the Administrative Trustee that such successor
Preferred Security is a "restricted security" within the meaning of Rule
144, in which case the Property Trustee, at the direction of the
Administrative Trustees, shall authenticate and deliver a new Preferred
Security bearing a Restricted Preferred Securities Legend in exchange for
such successor Preferred Security as provided in this Article Five.
(d) The Property Trustee shall not be required to insure or verify
compliance with securities laws, including the Securities Act, Exchange Act and
1940 Act, in connection with transfers and exchanges of Preferred Securities.
(e) No Obligation of the Property Trustee.
-------------------------------------
(i) The Property Trustee shall have no responsibility or obligation to any
beneficial owner of a Global Preferred Security, a Participant in the
Depositary or other Person with respect to the accuracy of the records of
the Depositary or its nominee or of any Participant thereof, with respect
to any ownership interest in the Preferred Securities or with respect to
the delivery to any Participant, beneficial owner or other Person (other
than the Depositary) of any notice (including any notice of redemption) or
the payment of any amount, under or with respect to such Preferred
Securities. All notices and communications to be given to the Holders and
all payments to be made to Holders under the Preferred Securities shall be
given or made only to or upon the order of the registered Holders (which
shall be the Depositary or its nominee in the case of a Global Preferred
Security). The rights of beneficial owners in any Global Preferred
Security shall be exercised only through the Depositary subject to the
applicable rules and procedures of the Depositary. The Property Trustee
may conclusively rely and shall be fully protected
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in relying upon information furnished by the Depositary or any agent
thereof with respect to its Participants and any beneficial owners.
(ii) The Property Trustee and Registrar shall have no obligation or duty
to monitor, determine or inquire as to compliance with any restrictions on
transfer imposed under this Trust Agreement or under applicable law with
respect to any transfer of any interest in any Preferred Security
(including any transfers between or among Depositary Participants or
beneficial owners in any Global Preferred Security) other than to require
delivery of such certificates and other documentation or evidence as are
expressly required by, and to do so if and when expressly required by, the
terms of this Trust Agreement, and to examine the same to determine
substantial compliance as to form with the express requirements hereof.
Section 5.6. Mutilated, Destroyed, Lost or Stolen Trust Securities
Certificates.
If (a) any mutilated Trust Securities Certificate shall be surrendered to
the Securities Registrar, or if the Securities Registrar shall receive evidence
to its satisfaction of the destruction, loss or theft of any Trust Securities
Certificate and (b) there shall be delivered to the Securities Registrar and the
Administrative Trustees such security or indemnity as may be required by them to
save each of them harmless, then in the absence of notice that such Trust
Securities Certificate shall have been acquired by a bona fide purchaser, the
Administrative Trustees, or any one of them, on behalf of the Trust shall
execute and make available for delivery, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Trust Securities Certificate, a new Trust
Securities Certificate of like class, tenor and denomination. In connection with
the issuance of any new Trust Securities Certificate under this Section, the
Administrative Trustees or the Securities Registrar may require the payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection therewith. Any duplicate Trust Securities Certificate issued
pursuant to this Section shall constitute conclusive evidence of an undivided
beneficial interest in the assets of the Trust, as if originally issued, whether
or not the lost, stolen or destroyed Trust Securities Certificate shall be found
at any time.
Section 5.7. Persons Deemed Securityholders.
The Trustees or the Securities Registrar shall treat the Person in whose
name any Trust Securities Certificate shall be registered in the Securities
Register as the owner of such Trust Securities Certificate for the purpose of
receiving Distributions and for all other purposes whatsoever, and neither the
Trustees nor the Securities Registrar shall be bound by any notice to the
contrary.
Section 5.8. Access to List of Securityholders' Names and Addresses.
Each Holder and each Owner shall be deemed to have agreed not to hold the
Depositor, the Property Trustee or the Administrative Trustees accountable by
reason of the disclosure of its name and address, regardless of the source from
which such information was derived.
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Section 5.9. Maintenance of Office or Agency.
The Administrative Trustees shall maintain an office or offices or agency
or agencies where Preferred Securities Certificates may be surrendered for
registration of transfer or exchange and where notices and demands to or upon
the Trustees in respect of the Trust Securities Certificates may be served. The
Administrative Trustees initially designate The Bank of New York, 101 Barclay
Street, New York, New York Attn: Treasurer, as its principal corporate trust
office for such purposes. The Administrative Trustees shall give prompt written
notice to the Depositor and to the Securityholders of any change in the location
of the Securities Register or any such office or agency.
Section 5.10. Appointment of Paying Agent.
The Paying Agent shall make Distributions to Securityholders from the
Payment Account and shall report the amounts of such Distributions to the
Property Trustee and the Administrative Trustees. Any Paying Agent shall have
the revocable power to withdraw funds from the Payment Account for the purpose
of making the Distributions referred to above. The Administrative Trustees may
revoke such power and remove the Paying Agent if such Trustees determine in
their sole discretion that the Paying Agent shall have failed to perform its
obligations under this Trust Agreement in any material respect. The Paying Agent
shall initially be the Property Trustee, and any co-paying agent chosen by the
Property Trustee, and acceptable to the Administrative Trustees and the
Depositor. Any Person acting as Paying Agent shall be permitted to resign as
Paying Agent upon 30 days' written notice to the Administrative Trustees and the
Depositor. In the event that the Property Trustee shall no longer be the Paying
Agent or a successor Paying Agent shall resign or its authority to act be
revoked, the Administrative Trustees shall appoint a successor that is
acceptable to the Depositor to act as Paying Agent (which shall be a bank or
trust company). The Administrative Trustees shall cause such successor Paying
Agent or any additional Paying Agent appointed by the Administrative Trustees to
execute and deliver to the Trustees an instrument in which such successor Paying
Agent or additional Paying Agent shall agree with the Trustees that as Paying
Agent, such successor Paying Agent or additional Paying Agent will hold all
sums, if any, held by it for payment to the Securityholders in trust for the
benefit of the Securityholders entitled thereto until such sums shall be paid to
such Securityholders. The Paying Agent shall return all unclaimed funds to the
Property Trustee and upon removal of a Paying Agent such Paying Agent shall also
return all funds in its possession to the Property Trustee. The provisions of
Sections 8.1, 8.3 and 8.6 herein shall apply to the Paying Agent appointed
hereunder. Any reference in this Agreement to the Paying Agent shall include any
co-paying agent unless the context requires otherwise.
Section 5.11. Ownership of Common Securities by Depositor.
At the Closing Time, the Depositor shall acquire and retain beneficial and
record ownership of the Common Securities. To the fullest extent permitted by
law, other than a transfer in connection with a consolidation or merger of the
Depositor into another corporation, or any conveyance, transfer or lease by the
Depositor of its properties and assets substantially as an entirety to any
Person, pursuant to Section 8.1 of the Indenture, and in either case only if the
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transferee of the Common Securities has "substantial assets" (other than the
Common Securities) within the meaning of Treasury Regulations Section 301.7701-
2(d)(2) and only upon an effective assignment and delegation by the Holder of
the Common Securities to its transferee of all its rights and obligations under
the Expense Agreement, any attempted transfer of the Common Securities shall be
void. The Administrative Trustees shall cause each Common Securities Certificate
issued to the Depositor to contain a legend stating "THIS CERTIFICATE IS NOT
TRANSFERABLE".
Section 5.12. Notices to Clearing Agency.
To the extent that a notice or other communication to the Owners is
required under this Trust Agreement, unless and until Definitive Preferred
Securities Certificates shall have been issued to Owners pursuant to Section
5.13, the Trustees shall give all such notices and communications specified
herein to be given to Owners to the Clearing Agency, and shall have no
obligations to the Owners.
Section 5.13. Temporary Preferred Securities.
Pending the preparation of permanent Preferred Securities (the "Permanent
Preferred Securities"), an Administrative Trustee may cause to be executed and
delivered on behalf of the Trust temporary Preferred Securities (the "Temporary
Preferred Securities"), which Temporary Preferred Securities are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any authorized
denomination, substantially of the tenor of the Permanent Preferred Securities
in lieu of which they are issued and with such appropriate insertions,
omissions, substitutions and other variations as the officers executing such
Temporary Preferred Securities may determine, as evidenced by their execution
thereof.
If Temporary Preferred Securities are issued, an Administrative Trustee
will cause Definitive Preferred Securities to be prepared without unreasonable
delay. After the preparation of Permanent Preferred Securities, the Temporary
Preferred Securities shall be exchangeable for Permanent Preferred Securities
upon surrender of the Temporary Preferred Securities at any office or agency of
the Depositor designated pursuant to Section 5.9, without charge to the Holder.
Upon surrender for cancellation of any one or more Temporary Preferred
Securities, the Depositor shall execute and the Property Trustee shall
authenticate and deliver in exchange therefor a like principal amount of
Permanent Preferred Securities of authorized denominations. Until so exchanged
the Temporary Preferred Securities shall in all respects be entitled to the same
benefits as Permanent Preferred Securities.
Section 5.14. Rights of Securityholders.
(a) The legal title to the Trust Property is vested exclusively in the
Property Trustee (in its capacity as such) in accordance with Section 2.9, and
the Securityholders shall not have any right or title therein other than the
undivided beneficial interest in the assets of the Trust conferred by their
Trust Securities and they shall have no right to call for any partition or
division of property, profits or rights of the Trust except as described below.
The Trust Securities shall be personal property giving only the rights
specifically set forth therein and in this Trust
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Agreement. The Trust Securities shall have no preemptive or similar rights and
when issued and delivered to Securityholders against payment of the purchase
price therefor will be fully paid and nonassessable by the Trust. The Holders of
the Preferred Securities, in their capacities as such, shall be entitled to the
same limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the State
of Delaware.
(b) For so long as any Preferred Securities remain Outstanding, if, upon a
Debenture Event of Default, the Debenture Trustee fails or the Holders of not
less than 25% in principal amount of the outstanding Debentures fail to declare
the principal of all of the Debentures to be immediately due and payable, the
Holders of at least 25% in Liquidation Amount of the Preferred Securities then
Outstanding shall have such right by a notice in writing to the Depositor and
the Debenture Trustee; and upon any such declaration such principal amount of
and the accrued interest on all of the Debentures shall become immediately due
and payable, provided that the payment of principal and interest on such
Debentures shall remain subordinated to the extent provided in the Indenture.
At any time after such a declaration of acceleration with respect to the
Debentures has been made and before a judgment or decree for payment of the
money due has been obtained by the Debenture Trustee as in the Indenture
provided, the Holders of a majority in Liquidation Amount of the Preferred
Securities, by written notice to the Property Trustee, the Depositor and the
Debenture Trustee, may rescind and annul such declaration and its consequences
if:
(i) the Depositor has paid or deposited with the Debenture Trustee a
sum sufficient to pay
(A) all overdue installments of interest (including any
Additional Interest (as defined in the Indenture)) on all of the
Debentures,
(B) the principal of (and premium, if any, on) any Debentures
which have become due otherwise than by such declaration of
acceleration and interest thereon at the rate borne by the Debentures,
and
(C) all sums paid or advanced by the Debenture Trustee under the
Indenture and the reasonable compensation, fees, expenses,
disbursements and advances of the Debenture Trustee and the Property
Trustee, their agents and counsel; and
(ii) all Events of Default with respect to the Debentures, other than
the non-payment of the principal of the Debentures which has become due
solely by such acceleration, have been cured or waived as provided in
Section 5.13 of the Indenture.
The Holders of a majority in aggregate outstanding principal amount of the
Preferred Securities may, on behalf of the Holders of all the Preferred
Securities, waive any past default under the Indenture, except a default in the
payment of principal (or premium, if any) or interest (unless such default has
been cured and a sum sufficient to pay all matured installments of interest and
principal (and premium, if any) due otherwise than by acceleration has been
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deposited with the Debenture Trustee and to pay all sums paid or incurred by the
Debenture Trustee pursuant to (i)(C) above) or a default in respect of a
covenant or provision which under the Indenture cannot be modified or amended
without the consent of the Holder of each outstanding Debenture. No such
rescission shall affect any subsequent default or impair any right consequent
thereon.
Upon receipt by the Property Trustee of written notice declaring such an
acceleration, or rescission and annulment thereof, by Holders of the Preferred
Securities all or part of which is represented by Global Preferred Securities, a
record date shall be established for determining Holders of Outstanding
Preferred Securities entitled to join in such notice, which record date shall be
at the close of business on the business day after the Property Trustee receives
such notice. The Holders on such record date, or their duly designated proxies,
and only such Persons, shall be entitled to join in such notice, whether or not
such Holders remain Holders after such record date; provided, that, unless such
declaration of acceleration, or rescission and annulment, as the case may be,
shall have become effective by virtue of the requisite percentage having joined
in such notice prior to the day which is 90 days after such record date, such
notice of declaration of acceleration, or rescission and annulment, as the case
may be, shall automatically and without further action by any Holder be canceled
and of no further effect. Nothing in this paragraph shall prevent a Holder, or a
proxy of a Holder, from giving, after expiration of such 90-day period, a new
written notice of declaration of acceleration, or rescission and annulment
thereof, as the case may be, that is identical to a written notice which has
been canceled pursuant to the proviso to the preceding sentence, in which event
a new record date shall be established pursuant to the provisions of this
Section 5.14(b).
(c) For so long as any Preferred Securities remain Outstanding, to the
fullest extent permitted by law and subject to the terms of this Trust Agreement
and the Indenture, upon a Debenture Event of Default specified in Section 5.1(1)
or 5.1(2) of the Indenture, any Holder of Preferred Securities shall have the
right to institute a proceeding directly against the Depositor, pursuant to
Section 5.8 of the Indenture, for enforcement of payment to such Holder of the
principal amount of (or premium, if any) or interest on Debentures having a
principal amount equal to the Liquidation Amount of the Preferred Securities of
such Holder (a "Direct Action"). Except as set forth in Section 5.14(b) and this
Section 5.14(c), the Holders of Preferred Securities shall have no right to
exercise directly any right or remedy available to the holders of, or in respect
of, the Debentures.
ARTICLE VI.
Acts of Securityholders; Meetings; Voting
Section 6.1. Limitations on Voting Rights.
(a) Except as provided in this Section, in Sections 5.14, 8.10 and 10.2 and
in the Indenture and as otherwise required by law, no Holder of Preferred
Securities shall have any right to vote or in any manner otherwise control the
administration, operation and management of the Trust or the obligations of the
parties hereto, nor shall anything herein set forth, or contained in
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the terms of the Trust Securities Certificates, be construed so as to constitute
the Securityholders from time to time as partners or members of an association.
(b) So long as any Debentures are held by the Property Trustee, the
Trustees shall not (i) direct the time, method and place of conducting any
proceeding for any remedy available to the Debenture Trustee, or executing any
trust or power conferred on the Debenture Trustee with respect to such
Debentures, (ii) waive any past default which is waivable under Section 5.13 of
the Indenture, (iii) exercise any right to rescind or annul a declaration that
the principal of all the Debentures shall be due and payable or (iv) consent to
any amendment, modification or termination of the Indenture or the Debentures,
where such consent shall be required, without, in each case, obtaining the prior
approval of the Holders of at least a majority in Liquidation Amount of all
Outstanding Preferred Securities, provided, however, that where a consent under
the Indenture would require the consent of each Holder of Debentures affected
thereby, no such consent shall be given by the Property Trustee without the
prior written consent of each Holder of Preferred Securities. The Trustees shall
not revoke any action previously authorized or approved by a vote of the Holders
of Preferred Securities, except by a subsequent vote of the Holders of Preferred
Securities. The Property Trustee shall notify all Holders of the Preferred
Securities of any notice of default received from the Debenture Trustee with
respect to the Debentures. In addition to obtaining the foregoing approvals of
the Holders of the Preferred Securities, prior to taking any of the foregoing
actions, the Trustees shall, at the expense of the Depositor, obtain an Opinion
of Counsel experienced in such matters to the effect that such action shall not
cause the Trust to fail to be classified as a grantor trust or cause the Trust
to be an association taxable as a corporation for United States federal income
tax purposes.
(c) If any proposed amendment to the Trust Agreement provides for, or the
Trustees otherwise propose to effect, (i) any action that would adversely affect
in any material respect the powers, preferences or special rights of the
Preferred Securities, whether by way of amendment to the Trust Agreement or
otherwise, or (ii) the dissolution, winding-up or termination of the Trust,
other than pursuant to the terms of this Trust Agreement, then the Holders of
Outstanding Preferred Securities as a class will be entitled to vote on such
amendment or proposal and such amendment or proposal shall not be effective
except with the approval of the Holders of at least a majority in Liquidation
Amount of the Outstanding Preferred Securities. Notwithstanding any other
provision of this Trust Agreement, no amendment to this Trust Agreement may be
made if, as a result of such amendment, it would cause the Trust to be
classified as an association taxable as a corporation or as other than a grantor
trust for United States federal income tax purposes.
Section 6.2. Notice of Meetings.
Notice of all meetings of the Holders of Preferred Securities, stating the
time, place and purpose of the meeting, shall be given by the Property Trustee
pursuant to Section 10.8 to each Holder of Preferred Securities of record, at
his registered address, at least 15 days and not more than 90 days before the
meeting. At any such meeting, any business properly before the meeting may be so
considered whether or not stated in the notice of the meeting. Any adjourned
meeting may be held as adjourned without further notice.
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Section 6.3. Meetings of Preferred Securityholders.
No annual meeting of Securityholders is required to be held. The
Administrative Trustees, however, shall call a meeting of Preferred
Securityholders to vote on any matter upon the written request of the Preferred
Securityholders of record of 25% of the Preferred Securities (based upon their
Liquidation Amount) and the Administrative Trustees or the Property Trustee may,
at any time in their discretion, call a meeting of Preferred Securityholders to
vote on any matters as to which Preferred Securityholders are entitled to vote.
Preferred Securityholders of record of 50% of the Outstanding Preferred
Securities (based upon their Liquidation Amount), present in person or by proxy,
shall constitute a quorum at any meeting of Securityholders.
If a quorum is present at a meeting, an affirmative vote by the Preferred
Securityholders of record present, in person or by proxy, holding more than a
majority of the Preferred Securities (based upon their Liquidation Amount) held
by the Preferred Securityholders of record present, either in person or by
proxy, at such meeting shall constitute the action of the Preferred
Securityholders, unless this Trust Agreement requires a greater number of
affirmative votes.
Section 6.4. Voting Rights.
Securityholders shall be entitled to one vote for each $1,000 of
Liquidation Amount represented by their Trust Securities in respect of any
matter as to which such Securityholders are entitled to vote.
Section 6.5. Proxies, etc.
At any meeting of Securityholders, any Securityholder entitled to vote
thereat may vote by proxy, provided that no proxy shall be voted at any meeting
unless it shall have been placed on file with the Administrative Trustees, or
with such other officer or agent of the Trust as the Administrative Trustees may
direct, for verification prior to the time at which such vote shall be taken.
Only Securityholders of record shall be entitled to vote. When Trust Securities
are held jointly by several persons, any one of them may vote at any meeting in
person or by proxy in respect of such Trust Securities, but if more than one of
them shall be present at such meeting in person or by proxy, and such joint
owners or their proxies so present disagree as to any vote to be cast, such vote
shall not be received in respect of such Trust Securities. A proxy purporting to
be executed by or on behalf of a Securityholder shall be deemed valid unless
challenged at or prior to its exercise or if earlier, until eleven months after
it is sent. No proxy shall be valid more than three years after its date of
execution.
Section 6.6. Securityholder Action by Written Consent.
Any action which may be taken by Securityholders at a meeting may be taken
without a meeting if Securityholders holding more than a majority of all
Outstanding Trust Securities (based upon their Liquidation Amount) entitled to
vote in respect of such action (or such larger
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proportion thereof as shall be required by any express provision of this Trust
Agreement) shall consent to the action in writing.
Section 6.7. Record Date for Voting and Other Purposes.
For the purposes of determining the Securityholders who are entitled to
notice of and to vote at any meeting or by written consent, or to participate in
any distribution on the Trust Securities in respect of which a record date is
not otherwise provided for in this Trust Agreement, or for the purpose of any
other action, the Administrative Trustees may from time to time fix a date, not
more than 90 days prior to the date of any meeting of Securityholders or the
payment of a distribution or other action, as the case may be, as a record date
for the determination of the identity of the Securityholders of record for such
purposes.
Section 6.8. Acts of Securityholders.
Any request, demand, authorization, direction, notice, consent, waiver or
other action provided or permitted by this Trust Agreement to be given, made or
taken by Securityholders or Owners may be embodied in and evidenced by one or
more instruments of substantially similar tenor signed by such Securityholders
or Owners in person or by an agent duly appointed in writing; and, except as
otherwise expressly provided herein, such action shall become effective when
such instrument or instruments are delivered to an Administrative Trustee. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Securityholders or
Owners signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Trust Agreement and (subject to Section 8.1) conclusive in favor
of the Trustees, if made in the manner provided in this Section.
The fact and date of the execution by any Person of any such instrument or
writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him the execution thereof. Where such execution is by
a signer acting in a capacity other than his individual capacity, such
certificate or affidavit shall also constitute sufficient proof of his
authority. The fact and date of the execution of any such instrument or writing,
or the authority of the Person executing the same, may also be proved in any
other manner which any Trustee receiving the same deems sufficient.
The ownership of Preferred Securities shall be proved by the Securities
Register.
Any request, demand, authorization, direction, notice, consent, waiver or
other Act of the Securityholder of any Trust Security shall bind every future
Securityholder of the same Trust Security and the Securityholder of every Trust
Security issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or suffered to
be done by the Trustees or the Trust in reliance thereon, whether or not
notation of such action is made upon such Trust Security.
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Without limiting the foregoing, a Securityholder entitled hereunder to take
any action hereunder with regard to any particular Trust Security may do so with
regard to all or any part of the Liquidation Amount of such Trust Security or by
one or more duly appointed agents each of which may do so pursuant to such
appointment with regard to all or any part of such Liquidation Amount.
If any dispute shall arise between the Securityholders and the
Administrative Trustees or among such Securityholders or Trustees with respect
to the authenticity, validity or binding nature of any request, demand,
authorization, direction, consent, waiver or other Act of such Securityholder or
Trustee under this Article VI, then the determination of such matter by the
Property Trustee shall be conclusive with respect to such matter.
A Securityholder may institute a legal proceeding directly against the
Depositor under the Guarantee to enforce its rights under the Guarantee without
first instituting a legal proceeding against the Guarantee Trustee (as defined
in the Guarantee), the Trust or any person or entity.
Section 6.9. Inspection of Records.
Upon reasonable notice to the Administrative Trustees and the Property
Trustee, the records of the Trust shall be open to inspection by Securityholders
during normal business hours for any purpose reasonably related to such
Securityholder's interest as a Securityholder.
ARTICLE VII.
Representations and Warranties of the Property
Trustee, the Delaware Trustee and the Depositor
Section 7.1. Property Trustee.
The Property Trustee hereby represents and warrants for the benefit of the
Depositor and the Securityholders that:
(a) the Property Trustee is a banking corporation or trust company duly
organized, validly existing and in good standing under the laws of the State of
New York;
(b) the Property Trustee has full corporate power, authority and legal
right to execute, deliver and perform its obligations under this Trust Agreement
and has taken all necessary action to authorize the execution, delivery and
performance by it of this Trust Agreement;
(c) the Trust Agreement has been duly authorized, executed and delivered by
the Property Trustee and constitutes the valid and legally binding agreement of
the Property Trustee enforceable against it in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles;
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(d) the execution, delivery and performance of this Trust Agreement has
been duly authorized by all necessary corporate or other action on the part of
the Property Trustee and does not require any approval of stockholders of the
Property Trustee and such execution, delivery and performance will not (i)
violate the Charter or By-laws of the Property Trustee, (ii) violate any
provision of, or constitute, with or without notice or lapse of time, a default
under, or result in the creation or imposition of, any Lien on any properties
included in the Trust Property pursuant to the provisions of, any Lien on any
properties included in the Trust Property pursuant to the provisions of, any
indenture, mortgage, credit agreement, license or other agreement or instrument
to which the Property Trustee is a party or by which it is bound or (iii)
violate any law, governmental rule or regulation of the United States, as the
case may be, governing the banking, trust or general powers of the Property
Trustee or any order, judgment or decree applicable to the Property Trustee;
(e) neither the authorization, execution or delivery by the Property
Trustee of this Trust Agreement nor the consummation of any of the transactions
by the Property Trustee contemplated herein require the consent or approval of,
the giving of notice to, the registration with or the taking of any other action
with respect to any governmental authority or agency under any existing Federal
or New York law governing the banking or trust powers of the Property Trustee.
(f) There are no proceedings pending or, to the best of the Property
Trustee's knowledge, threatened against or affecting the Property Trustee in any
court or before any governmental authority, agency or arbitration board or
tribunal which, individually or in the aggregate, would materially and adversely
affect the Trust or question the right, power and authority of the Property
Trustee to enter into or perform its obligations as one of the Trustees under
this Trust Agreement.
Section 7.2. Delaware Trustee.
The Delaware Trustee hereby represents and warrants for the benefit of the
Depositor and the Securityholders that:
(a) the Delaware Trustee is a banking corporation or trust company duly
organized, validly existing and in good standing under the laws of the State of
Delaware;
(b) the Delaware Trustee has full corporate power, authority and legal
right to execute, deliver and perform its obligations under this Trust Agreement
and has taken all necessary action to authorize the execution, delivery and
performance by it of this Trust Agreement;
(c) this Trust Agreement has been duly authorized, executed and delivered
by the Delaware Trustee and constitutes the valid and legally binding agreement
of the Delaware Trustee enforceable against it in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles;
(d) the execution, delivery and performance of this Trust Agreement has
been duly authorized by all necessary corporate or other action on the part of
the Delaware Trustee and does
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not require approval of stockholders of the Delaware Trustee and such execution,
delivery and performance will not (i) violate the Charter or By-laws of the
Delaware Trustee, (ii) violate any provision of, or constitute, with or without
notice or lapse of time, a default under, or result in the creation or
imposition of, any Lien on any properties included in the Trust Property
pursuant to the provision of, any indenture, mortgage, credit agreement, license
or other agreement or instrument to which the Delaware Trustee is a party or by
which it is bound or (iii) violate any law, governmental rule or regulation of
the United States or the State of Delaware, as the case may be, governing the
banking, trust or general powers of the Delaware Trustee or any order, judgement
or decree applicable to the Delaware Trustee.
(e) neither the authorization, execution or delivery by the Delaware
Trustee of this Trust Agreement nor the consummation of any of the transactions
by the Delaware Trustee contemplated herein require the consent or approval of,
the giving of notice to, the registration with or the taking of any other action
with respect to any governmental authority or agency under any existing Federal
or Delaware law governing the banking or trust powers of the Delaware Trustee.
(f) there are no proceedings pending or, to the best of the Delaware
Trustee's knowledge, threatened against or affecting the Delaware Trustee in any
court or before any governmental authority, agency or arbitration board or
tribunal which, individually or in the aggregate, would materially and adversely
affect the Trust or would question the right, power and authority of the
Delaware Trustee to enter into or perform its obligations as one of the Trustees
under this Trust Agreement.
Section 7.3. Depositor.
The Depositor hereby represents and warrants for the benefit of the
Securityholders that:
(a) the Trust Securities Certificates issued on the Closing Date on behalf
of the Trust have been duly authorized and will have been duly and validly
executed, issued and delivered by the Administrative Trustees pursuant to the
terms and provisions of, and in accordance with the requirements of, this Trust
Agreement and the Securityholders will be, as of such date, entitled to the
benefits of this Trust Agreement; and
(b) there are no taxes, fees or other governmental charges payable by the
Trust (or the Trustees) under the laws of the State of Delaware or any political
subdivision thereof in connection with the execution, delivery and performance
by the Property Trustee or the Delaware Trustee, as the case may be, of this
Trust Agreement.
(c) this Trust Agreement has been duly authorized, executed and delivered
by the Depositor and constitutes the valid and legally binding agreement of the
Depositor, enforceable against it in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors' rights
and to general equity principles.
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ARTICLE VIII.
THE TRUSTEES
Section 8.1. Certain Duties and Responsibilities.
(a) The duties and responsibilities of the Trustees shall be as provided by
this Trust Agreement and, in the case of the Property Trustee, by the Trust
Indenture Act and no implied covenants or obligations shall be read into this
Trust Agreement against any of the Trustees. Notwithstanding the foregoing, no
provision of this Trust Agreement shall require the Trustees to expend or risk
their own funds or otherwise incur any financial liability in the performance
of any of their duties hereunder, or in the exercise of any of their rights or
powers, if they shall have reasonable grounds for believing that repayment of
such funds or adequate indemnity against such risk or liability is not
reasonably assured to it. Whether or not therein expressly so provided, every
provision of this Trust Agreement relating to the conduct or affecting the
liability of or affording protection to the Trustees shall be subject to the
provisions of this Section. Nothing in this Trust Agreement shall be construed
to release an Administrative Trustee from liability for its own gross negligent
action, its own gross negligent failure to act, or its own willful misconduct.
To the extent that, at law or in equity, an Administrative Trustee has duties
(including fiduciary duties) and liabilities relating thereto to the Trust or
to the Securityholders, such Administrative Trustee shall not be liable to the
Trust or to any Securityholder for such Trustee's good faith reliance on the
provisions of this Trust Agreement. The provisions of this Trust Agreement, to
the extent that they restrict the duties and liabilities of the Administrative
Trustees otherwise existing at law or in equity, are agreed by the Depositor
and the Securityholders to replace such other duties and liabilities of the
Administrative Trustees.
(b) All payments made by the Property Trustee or a Paying Agent in respect
of the Trust Securities shall be made only from the revenue and proceeds from
the Trust Property and only to the extent that there shall be sufficient
revenue or proceeds from the Trust Property to enable the Property Trustee or a
Paying Agent to make payments in accordance with the terms hereof. Each
Securityholder, by its acceptance of a Trust Security, agrees that it will look
solely to the revenue and proceeds from the Trust Property to the extent
legally available for distribution to it as herein provided and that the
Trustees are not personally liable to it for any amount distributable in
respect of any Trust Security or for any other liability in respect of any
Trust Security. This Section 8.1(b) does not limit the liability of the
Trustees expressly set forth elsewhere in this Trust Agreement or, in the case
of the Property Trustee, in the Trust Indenture Act.
(c) No provision of this Trust Agreement shall be construed to relieve the
Property Trustee from liability for its own negligent action, its own negligent
failure to act, or its own willful misconduct, except that:
(i) the Property Trustee shall not be liable for any error of
judgment made in good faith by an authorized officer of the Property
Trustee, unless it shall be proved that the Property Trustee was negligent
in ascertaining the pertinent facts;
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(ii) the Property Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in good faith in accordance with
the direction of the Holders of not less than a majority in Liquidation
Amount of the Trust Securities relating to the time, method and place of
conducting any proceeding for any remedy available to the Property Trustee,
or exercising any trust or power conferred upon the Property Trustee under
this Trust Agreement;
(iii) the Property Trustee's sole duty with respect to the custody,
safe keeping and physical preservation of the Debentures and the Payment
Account shall be to deal with such property in a similar manner as the
Property Trustee deals with similar property for its own account, subject
to the protections and limitations on liability afforded to the Property
Trustee under this Trust Agreement and the Trust Indenture Act;
(iv) the Property Trustee shall not be liable for any interest on any
money received by it except as it may otherwise agree in writing with the
Depositor; and money held by the Property Trustee need not be segregated
from other funds held by it except in relation to the Payment Account
maintained by the Property Trustee pursuant to Section 3.1 and except to
the extent otherwise required by law; and
(v) the Property Trustee shall not be responsible for monitoring the
compliance by the Administrative Trustees or the Depositor with their
respective duties under this Trust Agreement, nor shall the Property
Trustee be liable for the default or misconduct of the Administrative
Trustees or the Depositor.
Section 8.2. Certain Notices.
Within five Business Days after the occurrence of any Event of Default
actually known to the Property Trustee, the Property Trustee shall transmit, in
the manner and to the extent provided in Section 10.8, notice of such Event of
Default to the Securityholders, the Administrative Trustees and the Depositor,
unless such Event of Default shall have been cured or waived.
Within five Business Days after the receipt of notice of the Depositor's
exercise of its right to defer the payment of interest on the Debentures
pursuant to the Indenture, the Administrative Trustee shall transmit, in the
manner and to the extent provided in Section 10.8, notice of such exercise to
the Securityholders and the Property Trustee, unless such exercise shall have
been revoked.
Section 8.3. Certain Rights of Property Trustee.
Subject to the provisions of Section 8.1:
(a) the Property Trustee may rely and shall be protected in acting or
refraining from acting in good faith upon any resolution, Opinion of Counsel,
certificate, written representation of a Holder or transferee, certificate of
auditors or any other certificate, statement, instrument, opinion, report,
notice, request, consent, order, appraisal, bond, debenture, note, other
evidence of
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indebtedness or other paper or document believed by it to be genuine and to have
been signed or presented by the proper party or parties;
(b) if (i) in performing its duties under this Trust Agreement the Property
Trustee is required to decide between alternative courses of action or (ii) in
construing any of the provisions of this Trust Agreement the Property Trustee
finds the same ambiguous or inconsistent with any other provisions contained
herein or (iii) the Property Trustee is unsure of the application of any
provision of this Trust Agreement, then, except as to any matter as to which the
Preferred Securityholders are entitled to vote under the terms of this Trust
Agreement, the Property Trustee shall deliver a notice to the Depositor
requesting written instructions of the Depositor as to the course of action to
be taken and the Property Trustee shall take such action, or refrain from taking
such action, as the Property Trustee shall be instructed in writing to take, or
to refrain from taking, by the Depositor; provided, however, that if the
Property Trustee does not receive such instructions of the Depositor within ten
Business Days after it has delivered such notice, or such reasonably shorter
period of time set forth in such notice (which to the extent practicable shall
not be less than two Business Days), it may, but shall be under no duty to, take
or refrain from taking such action not inconsistent with this Trust Agreement as
it shall deem advisable and in the best interests of the Securityholders, in
which event the Property Trustee shall have no liability except for its own bad
faith, negligence or willful misconduct;
(c) any direction or act of the Depositor or the Administrative Trustees
contemplated by this Trust Agreement shall be sufficiently evidenced by an
Officers' Certificate;
(d) whenever in the administration of this Trust Agreement, the Property
Trustee shall deem it desirable that a matter be proved or established before
undertaking, suffering or omitting any action hereunder, the Property Trustee
(unless other evidence is herein specifically prescribed) may, in the absence of
bad faith on its part, request and rely upon an Officers' Certificate which,
upon receipt of such request, shall be promptly delivered by the Depositor or
the Administrative Trustees;
(e) the Property Trustee shall have no duty to see to any recording, filing
or registration of any instrument (including any financing or continuation
statement or any filing under tax or securities laws) or any rerecording,
refiling or reregistration thereof;
(f) the Property Trustee may consult with counsel of its selection and the
advice of such counsel shall be full and complete authorization and protection
in respect of any action taken, suffered or omitted by it hereunder in good
faith and in reliance thereon and in accordance with such advice, the Property
Trustee shall have the right at any time to seek instructions concerning the
administration of this Trust Agreement from any court of competent jurisdiction;
(g) the Property Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Trust Agreement at the request or
direction of any of the Securityholders pursuant to this Trust Agreement, unless
such Securityholders shall have offered to the Property Trustee reasonable
security or indemnity against the costs, expenses (including reasonable
attorney's fees and expenses) and liabilities which might be incurred by it in
compliance with such request or direction;
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(h) the Property Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval, bond,
debenture, note or other evidence of indebtedness or other paper or document,
unless requested in writing to do so by one or more Securityholders, but the
Property Trustee may make such further inquiry or investigation into such facts
or matters as it may see fit;
(i) the Property Trustee may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through its agents or
attorneys, and the Property Trustee shall not be responsible for any misconduct
or negligence on the part of any agent or attorney appointed with due care by
the Property Trustee hereunder, provided that the Property Trustee shall be
responsible for its own negligence or recklessness with respect to selection of
any agent or attorney appointed by it hereunder;
(j) whenever in the administration of this Trust Agreement the Property
Trustee shall deem it desirable to receive written instructions with respect to
enforcing any remedy or right or taking any other action hereunder the Property
Trustee (i) may request written instructions from the Holders of the Trust
Securities which written instructions may be given only by the Holders of the
same proportion in Liquidation Amount of the Trust Securities as would be
entitled to direct the Property Trustee under the terms of the Trust Securities
in respect of such remedy, right or action, (ii) may refrain from enforcing such
remedy or right or taking such other action until such written instructions are
received and (iii) shall be protected in acting in accordance with such written
instructions; and
(k) except as otherwise expressly provided by this Trust Agreement, the
Property Trustee shall not be under any obligation to take any action that is
discretionary under the provisions of this Trust Agreement.
No provision of this Trust Agreement shall be deemed to impose any duty or
obligation on the Property Trustee to perform any act or acts or exercise any
right, power, duty or obligation conferred or imposed on it, in any jurisdiction
in which it shall be illegal, or in which the Property Trustee shall be
unqualified or incompetent in accordance with applicable law, to perform any
such act or acts, or to exercise any such right, power, duty or obligation. No
permissive power or authority available to the Property Trustee shall be
construed to be a duty.
Section 8.4. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Trust Securities Certificates
shall be taken as the statements of the Trust, and the Trustees do not assume
any responsibility for their correctness. The Trustees shall not be accountable
for the use or application by the Depositor of the proceeds of the Debentures.
Section 8.5. May Hold Securities.
Except as provided in the definition of the term "Outstanding" in Article
I, any Trustee or any other agent of any Trustee or the Trust, in its individual
or any other capacity, may
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become the owner or pledgee of Trust Securities and, subject to Sections 8.8 and
8.13, may otherwise deal with the Trust with the same rights it would have if it
were not a Trustee or such other agent.
Section 8.6. Compensation; Indemnity; Fees.
The Depositor agrees:
(a) to pay to the Trustees from time to time such compensation as shall be
agreed to in writing with the Depositor for all services rendered by them
hereunder (which compensation shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust);
(b) except as otherwise expressly provided herein, to reimburse the
Trustees upon request for all reasonable expenses, disbursements and advances
incurred or made by the Trustees in accordance with any provision of this Trust
Agreement (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense, disbursement
or advance as may be attributable to its negligence or bad faith; and
(c) to the fullest extent permitted by applicable law, to indemnify and
hold harmless (i) each Trustee, (ii) any Affiliate of any Trustee, (iii) any
officer, director, shareholder, employee, representative or agent of any Trustee
and (iv) any employee or agent of the Trust or its Affiliates, (referred to
herein as an "Indemnified Person") from and against any loss, damage, liability,
tax, penalty, expense or claim of any kind or nature whatsoever incurred by such
Indemnified Person by reason of the creation, operation or termination of the
Trust or any act or omission performed or omitted by such Indemnified Person in
good faith on behalf of the Trust and in a manner such Indemnified Person
reasonably believed to be within the scope of authority conferred on such
Indemnified Person by this Trust Agreement, except that no Indemnified Person
shall be entitled to be indemnified in respect of any loss, damage or claim
incurred by such Indemnified Person by reason of negligence or willful
misconduct with respect to such acts or omissions. When the Property Trustee
incurs expenses or renders services in connection with an Event of Default
specified in Section 5.1(4) or Section 5.1(5) of the Indenture, the expenses
(including the reasonable charges and expenses of its counsel) and the
compensation for the services are intended to constitute expenses of
administration under any applicable federal or state bankruptcy, insolvency or
similar laws.
The provisions of this Section 8.6 shall survive the termination of this
Trust Agreement or the earlier resignations or removal of any Trustee.
No Trustee may claim any lien or charge on any Trust Property as a result
of any amount due pursuant to this Section 8.6.
The Depositor and any Trustee may engage in or possess an interest in other
business ventures of any nature or description, independently or with others,
similar or dissimilar to the business of the Trust, and the Trust and the
Holders of Trust Securities shall have no rights by virtue of this Trust
Agreement in and to such independent ventures or the income or profits
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derived therefrom, and the pursuit of any such venture, even if competitive with
the business of the Trust, shall not be deemed wrongful or improper. Neither the
Depositor, nor any Trustee, shall be obligated to present any particular
investment or other opportunity to the Trust even if such opportunity is of a
character that, if presented to the Trust, could be taken by the Trust, and the
Depositor or any Trustee shall have the right to take for its own account
(individually or as a partner or fiduciary) or to recommend to others any such
particular investment or other opportunity. Any Trustee may engage or be
interested in any financial or other transaction with the Depositor or any
Affiliate of the Depositor, or may act as depositary for, trustee or agent for,
or act on any committee or body of holders of, securities or other obligations
of the Depositor or its Affiliates.
Section 8.7. Corporate Property Trustee Required; Eligibility of Trustees.
(a) There shall at all times be a Property Trustee hereunder with respect
to the Trust Securities. The Property Trustee shall be a Person that is eligible
pursuant to the Trust Indenture Act to act as such and has a combined capital
and surplus of at least $50,000,000. If any such Person publishes reports of
condition at least annually, pursuant to law or to the requirements of its
supervising or examining authority, then for the purposes of this Section, the
combined and surplus of such Person shall be deemed to be its combined and
surplus as set forth in its most recent report of condition so published. If at
any time the Property Trustee with respect to the Trust Securities shall cease
to be eligible in accordance with the provisions of this Section, it shall
resign immediately in the manner and with the effect hereinafter specified in
this Article.
(b) There shall at all times be one or more Administrative Trustees
hereunder with respect to the Trust Securities. Each Administrative Trustee
shall be either a natural person who is at least 21 years of age or a legal
entity that shall act through one or more persons authorized to bind that
entity.
(c) There shall at all times be a Delaware Trustee with respect to the
Trust Securities. The Delaware Trustee shall either be (i) a natural person who
is at least 21 years of age and a resident of the State of Delaware or (ii) a
legal entity with its principal place of business in the State of Delaware and
that otherwise meets the requirements of applicable Delaware law that shall act
through one or more persons authorized to bind such entity.
Section 8.8. Conflicting Interests.
If the Property Trustee has or shall acquire a conflicting interest within
the meaning of the Trust Indenture Act, the Property Trustee shall either
eliminate such interest or resign, to the extent and in the manner provided by,
and subject to the provisions of, the Trust Indenture Act and this Trust
Agreement.
Section 8.9. Co-Trustees and Separate Trustee.
Unless an Event of Default shall have occurred and be continuing, at any
time or times, for the purpose of meeting the legal requirements of the Trust
Indenture Act or of any jurisdiction in which any part of the Trust Property may
at the time be located, the Depositor and the
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Administrative Trustees shall have power to appoint, and upon the written
request of the Administrative Trustees, the Depositor shall for such purpose
join with the Administrative Trustees in the execution, delivery, and
performance of all instruments and agreements necessary or proper to appoint,
one or more Persons approved by the Property Trustee either to act as co-
trustee, jointly with the Property Trustee, of all or any part of such Trust
Property, or to the extent required by law to act as separate trustee of any
such property, in either case with such powers as may be provided in the
instrument of appointment, and to vest in such Person or Persons in the capacity
aforesaid, any property, title, right or power deemed necessary or desirable,
subject to the other provisions of this Section. If the Depositor does not join
in such appointment within 15 days after the receipt by it of a request so to
do, or in case a Debenture Event of Default has occurred and is continuing, the
Property Trustee alone shall have power to make such appointment. Any co-trustee
or separate trustee appointed pursuant to this Section shall either be (i) a
natural person who is at least 21 years of age and a resident of the United
States or (ii) a legal entity with its principal place of business in the United
States that shall act through one or more persons authorized to bind such
entity.
Should any written instrument from the Depositor be required by any co-
trustee or separate trustee so appointed for more fully confirming to such co-
trustee or separate trustee such property, title, right, or power, any and all
such instruments shall, on request, be executed, acknowledged and delivered by
the Depositor.
Every co-trustee or separate trustee shall, to the extent permitted by law,
but to such extent only, be appointed subject to the following terms, namely:
(a) The Trust Securities shall be executed and delivered and all rights,
powers, duties and obligations hereunder in respect of the custody of
securities, cash and other personal property held by, or required to be
deposited or pledged with, the Trustees specified hereunder shall be exercised
solely by such Trustees and not by such co-trustee or separate trustee.
(b) The rights, powers, duties and obligations hereby conferred or imposed
upon the Property Trustee in respect of any property covered by such appointment
shall be conferred or imposed upon and exercised or performed by the Property
Trustee or by the Property Trustee and such co-trustee or separate trustee
jointly, as shall be provided in the instrument appointing such co-trustee or
separate trustee, except to the extent that under any law of any jurisdiction in
which any particular act is to be performed, the Property Trustee shall be
incompetent or unqualified to perform such act, in which event such rights,
powers, duties and obligations shall be exercised and performed by such co-
trustee or separate trustee.
(c) The Property Trustee at any time, by an instrument in writing executed
by it, with the written concurrence of the Depositor, may accept the resignation
of or remove any co-trustee or separate trustee appointed under this Section,
and, in case a Debenture Event of Default has occurred and is continuing, the
Property Trustee shall have power to accept the resignation of, or remove, any
such co-trustee or separate trustee without the concurrence of the Depositor.
Upon the written request of the Property Trustee, the Depositor shall join with
the Property Trustee in the execution, delivery and performance of all
instruments and agreements necessary or proper
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to effectuate such resignation or removal. A successor to any co-trustee or
separate trustee so resigned or removed may be appointed in the manner provided
in this Section.
(d) No co-trustee or separate trustee hereunder shall be personally liable
by reason of any act or omission of the Property Trustee or any other trustee
hereunder.
(e) The Property Trustee shall not be liable by reason of any act of a co-
trustee or separate trustee.
(f) Any Act of Holders delivered to the Property Trustee shall be deemed to
have been delivered to each such co-trustee and separate trustee.
Section 8.10. Resignation and Removal; Appointment of Successor.
No resignation or removal of any Trustee (the "Relevant Trustee") and no
appointment of a successor Trustee pursuant to this Article shall become
effective until the acceptance of appointment by the successor Trustee in
accordance with the applicable requirements of Section 8.11.
Subject to the immediately preceding paragraph, the Relevant Trustee may
resign at any time by giving written notice thereof to the Securityholders. If
the instrument of acceptance by the successor Trustee required by Section 8.11
shall not have been delivered to the Relevant Trustee within 30 days after the
giving of such notice of resignation, the Relevant Trustee may petition, at the
expense of the Trust, any court of competent jurisdiction for the appointment of
a successor Relevant Trustee.
Unless a Debenture Event of Default shall have occurred and be continuing,
any Trustee may be removed at any time by Act of the Common Securityholder. If a
Debenture Event of Default shall have occurred and be continuing, the Property
Trustee or the Delaware Trustee, or both of them, may be removed at such time by
Act of the Holders of a majority in Liquidation Amount of the Preferred
Securities, delivered to the Relevant Trustee (in its individual capacity and on
behalf of the Trust). An Administrative Trustee may be removed by the Common
Securityholder at any time. If the instrument of acceptance by the successor
Trustee required by Section 8.11 shall not have been delivered to the Relevant
Trustee within 30 days after such removal, the Relevant Trustee may petition, at
the expense of the Trust, any court of competent jurisdiction for the
appointment or a successor Relevant Trustee.
If any Trustee shall resign, be removed or become incapable of acting as
Trustee, or if a vacancy shall occur in the office of any Trustee for any cause,
at a time when no Debenture Event of Default shall have occurred and be
continuing, the Common Securityholder, by Act of the Common Securityholder
delivered to the retiring Trustee, shall promptly appoint a successor Trustee or
Trustees, and the retiring Trustee shall comply with the applicable requirements
of Section 8.11. If the Property Trustee or the Delaware Trustee shall resign,
be removed or become incapable of continuing to act as the Property Trustee or
the Delaware Trustee, as the case may be, at a time when a Debenture Event of
Default shall have occurred and be continuing, the Preferred Securityholders, by
Act of the Securityholders of a majority in Liquidation Amount of
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the Preferred Securities then Outstanding delivered to the retiring Relevant
Trustee, shall promptly appoint a successor Relevant Trustee or Trustees, and
such successor Trustee shall comply with the applicable requirements of Section
8.11. If an Administrative Trustee shall resign, be removed or become incapable
of acting as Administrative Trustee, at a time when a Debenture Event of Default
shall have occurred and be continuing, the Common Securityholder by Act of the
Common Securityholder delivered to the Administrative Trustee shall promptly
appoint a successor Administrative Trustee or Administrative Trustees and such
successor Administrative Trustee or Trustees shall comply with the applicable
requirements of Section 8.11. If no successor Relevant Trustee shall have been
so appointed by the Common Securityholder or the Preferred Securityholders and
accepted appointment in the manner required by Section 8.11, any Securityholder
who has been a Securityholder of Trust Securities for at least six months may,
on behalf of himself and all others similarly situated, petition any court of
competent jurisdiction for the appointment of a successor Relevant Trustee.
The Property Trustee shall give notice of each resignation and each removal
of a Trustee and each appointment of a successor Trustee to all Securityholders
in the manner provided in Section 10.8 and shall give notice to the Depositor.
Each notice shall include the name of the successor Relevant Trustee and the
address of its Corporate Trust Office if it is the Property Trustee.
Notwithstanding the foregoing or any other provision of this Trust
Agreement, in the event any Administrative Trustee or a Delaware Trustee who is
a natural person dies or becomes, in the opinion of the Depositor, incompetent
or incapacitated, the vacancy created by such death, incompetence or incapacity
may be filled by (a) the unanimous act of the remaining Administrative Trustees
if there are at least two of them or (b) otherwise by the Depositor (with the
successor in each case being a Person who satisfies the eligibility requirement
for Administrative Trustees or Delaware Trustee, as the case may be, set forth
in Section 8.7).
Section 8.11. Acceptance of Appointment by Successor.
In case of the appointment hereunder of a successor Trustee such successor
Trustee so appointed shall execute, acknowledge and deliver to the Trust and to
the retiring Trustee an instrument accepting such appointment, and thereupon the
resignation or removal of the retiring Trustee shall become effective and such
successor Trustee, without any further act, deed or conveyance, shall become
vested with all the rights, powers, trusts and duties of the retiring Trustee;
but, on the request of the Depositor or the successor Trustee, such retiring
Trustee shall, upon payment of its charges, execute and deliver an instrument
transferring to such successor Trustee all the rights, powers and trusts of the
retiring Trustee and if the Property Trustee is the resigning Trustee shall duly
assign, transfer and deliver to the successor Trustee all property and money
held by such retiring Property Trustee hereunder.
In case of the appointment hereunder of a successor Relevant Trustee, the
retiring Relevant Trustee and each successor Relevant Trustee with respect to
the Trust Securities shall execute and deliver an amendment hereto wherein each
successor Relevant Trustee shall accept such appointment and which (a) shall
contain such provisions as shall be necessary or desirable to transfer and
confirm to, and to vest in, each successor Relevant Trustee all the rights,
powers,
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trusts and duties of the retiring Relevant Trustee with respect to the Trust
Securities and the Trust and (b) shall add to or change any of the provisions of
this Trust Agreement as shall be necessary to provide for or facilitate the
administration of the Trust by more than one Relevant Trustee, it being
understood that nothing herein or in such amendment shall constitute such
Relevant Trustees co-trustees and upon the execution and delivery of such
amendment the resignation or removal of the retiring Relevant Trustee shall
become effective to the extent provided therein and each such successor Relevant
Trustee, without any further act, deed or conveyance, shall become vested with
all the rights, powers, trusts and duties of the retiring Relevant Trustee; but,
on request of the Trust or any successor Relevant Trustee such retiring Relevant
Trustee shall duly assign, transfer and deliver to such successor Relevant
Trustee all Trust Property, all proceeds thereof and money held by such retiring
Relevant Trustee hereunder with respect to the Trust Securities and the Trust.
Upon written request of any such successor Relevant Trustee, the Trust
shall execute any and all instruments for more fully and certainly vesting in
and confirming to such successor Relevant Trustee all such rights, powers and
trusts referred to in the first or second preceding paragraph, as the case may
be.
No successor Relevant Trustee shall accept its appointment unless at the
time of such acceptance such successor Relevant Trustee shall be qualified and
eligible under this Article.
Section 8.12. Merger, Conversion, Consolidation or Succession to Business.
Any Person into which the Property Trustee or the Delaware Trustee may be
merged or converted or with which it may be consolidated, or any Person
resulting from any merger, conversion or consolidation to which such Relevant
Trustee shall be a party, or any Person succeeding to all or substantially all
the corporate trust business of such Relevant Trustee, shall be the successor of
such Relevant Trustee hereunder, provided such Person shall be otherwise
qualified and eligible under this Article, without the execution or filing of
any paper or any further act on the part of any of the parties hereto.
Section 8.13. Preferential Collection of Claims Against Depositor or Trust.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
similar judicial proceeding relative to the Trust or any other obligor upon the
Trust Securities or the property of the Trust or of such other obligor or their
creditors, the Property Trustee (irrespective of whether any Distributions on
the Trust Securities shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Property Trustee shall
have made any demand on the Trust for the payment of any past due Distributions)
shall be entitled and empowered, to the fullest extent permitted by law, by
intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of any Distributions
owing and unpaid in respect of the Trust Securities and to file such other
papers or documents as may be necessary or advisable in order to have the claims
of the Property Trustee (including any claim for the
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reasonable compensation, expenses, disbursements and advances of the Property
Trustee, its agents and counsel) and of the Holders allowed in such judicial
proceeding, and
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same.
Any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Property Trustee and, in the event the
Property Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Property Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Property Trustee, its
agents and counsel, and any other amounts due the Property Trustee.
Nothing herein contained shall be deemed to authorize the Property Trustee
to authorize or consent to or accept or adopt on behalf of any Holder any plan
of reorganization, arrangement adjustment or compensation affecting the Trust
Securities or the rights of any Holder thereof or to authorize the Property
Trustee to vote in respect of the claim of any Holder in any such proceeding.
Section 8.14. Reports by Property Trustee.
(a) Not later than 60 days after December 31 of each year commencing with
December 31, 1996, the Property Trustee shall transmit to all Securityholders in
accordance with Section 10.8, and to the Depositor, a brief report dated as of
the immediately preceding December 31 with respect to:
(i) its eligibility under Section 8.7 or, in lieu thereof, if to the
best of its knowledge it has continued to be eligible under said Section, a
written statement to such effect;
(ii) a statement that the Property Trustee has complied with all of
its obligations under this Trust Agreement during the twelve-month period
(or, in the case of the initial report, the period since the Closing Date)
ending with such December 31 or, if the Property Trustee has not complied
in any material respect with such obligations, a description of such
noncompliance; and
(iii) any change in the property and funds in its possession as
Property Trustee since the date of its last report and any action taken by
the Property Trustee in the performance of its duties hereunder which it
has not previously reported and which in its opinion materially affects the
Trust Securities.
(b) In addition the Property Trustee shall transmit to Securityholders such
reports concerning the Property Trustee and its actions under this Trust
Agreement as may be required pursuant to the Trust Indenture Act at the times
and in the manner provided pursuant thereto.
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(c) A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Property Trustee with each national stock exchange, the
Nasdaq National Market or such other interdealer quotation system or self-
regulatory organization upon which the Trust Securities are listed or traded, if
any, with the Commission and with the Depositor. The Depositor will promptly
notify the Property Trustee of any such listing or trading.
Section 8.15. Reports to the Property Trustee.
The Depositor and the Administrative Trustees on behalf of the Trust shall
provide to the Property Trustee such documents, reports and information as
required by Section 314 of the Trust Indenture Act (if any) and the compliance
certificate required by Section 314(a) of the Trust Indenture Act in the form,
in the manner and at the times required by Section 314 of the Trust Indenture
Act.
Section 8.16. Evidence of Compliance with Conditions Precedent.
Each of the Depositor and the Administrative Trustees on behalf of the
Trust shall provide to the Property Trustee such evidence of compliance with any
conditions precedent, if any, provided for in this Trust Agreement that relate
to any of the matters set forth in Section 314 (c) of the Trust Indenture Act.
Any certificate or opinion required to be given by an officer pursuant to
Section 314(c)(1) of the Trust Indenture Act shall be given in the form of an
Officers' Certificate.
Section 8.17. Number of Trustees.
(a) The number of Trustees shall be four, provided that the Holder of all
of the Common Securities by written instrument may increase or decrease the
number of Administrative Trustees. The Property Trustee and the Delaware Trustee
may be the same Person.
(b) If a Trustee ceases to hold office for any reason and the number of
Administrative Trustees is not reduced pursuant to Section 8.17(a), or if the
number of Trustees is increased pursuant to Section 8.17(a), a vacancy shall
occur. The vacancy shall be filled with a Trustee appointed in accordance with
Section 8.10.
(c) A Trustee's death, resignation, retirement, removal, bankruptcy,
incompetence or incapacity to perform the duties of a Trustee shall not operate
to annul the Trust. Whenever a vacancy in the number of Administrative Trustees
shall occur, until such vacancy is filled by the appointment of an
Administrative Trustee in accordance with Section 8.10, the Administrative
Trustees in office, regardless of their number (and notwithstanding any other
provision of this Agreement), shall have all the powers granted to the
Administrative Trustees and shall discharge all the duties imposed upon the
Administrative Trustees by this Trust Agreement.
Section 8.18. Delegation of Power.
(a) Any Administrative Trustee may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of 21 his or
her power for the purpose of
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executing any documents contemplated in Section 2.7(a), including any
registration statement or amendment thereto filed with the Commission, or making
any other governmental filing; and
(b) The Administrative Trustees shall have power to delegate from time to
time to such of their number or to the Depositor the doing of such things and
the execution of such instruments either in the name of the Trust or the names
of the Administrative Trustees or otherwise as the Administrative Trustees may
deem expedient, to the extent such delegation is not prohibited by applicable
law or contrary to the provisions of this Trust Agreement, as set forth herein.
ARTICLE IX.
Termination, Liquidation and Merger
Section 9.1. Termination Upon Expiration Date.
Unless earlier terminated, the Trust shall automatically terminate on
December 31, 2052 (the "Expiration Date"), following the distribution of the
Trust Property in accordance with Section 9.4.
Section 9.2. Early Termination.
The first to occur of any of the following events is an "Early Termination
Event":
(a) the occurrence of a Bankruptcy Event in respect of, or the dissolution
or liquidation of, the Holder of the Common Securities;
(b) the written direction to the Property Trustee from the Depositor at any
time to terminate the Trust and, after satisfaction of liabilities to creditors
of the Trust as provided by applicable law, distribute Debentures to
Securityholders in exchange for the Preferred Securities (which direction is
optional and wholly within the discretion of the Depositor);
(c) the redemption of all of the Preferred Securities in connection with
the redemption of all the Debentures; and
(d) the entry of an order for dissolution of the Trust by a court of
competent jurisdiction.
Section 9.3. Termination.
The respective obligations and responsibilities of the Trustees and the
Trust created and continued hereby shall terminate upon the latest to occur of
the following: (a) the distribution by the Property Trustee to Securityholders
upon the liquidation of the Trust pursuant to Section 9.4, or upon the
redemption of all of the Trust Securities pursuant to Section 4.2, of all
amounts required to be distributed hereunder upon the final payment of the Trust
Securities; (b) the payment of any expenses owed by the Trust; and (c) the
discharge of all administrative duties of
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the Administrative Trustees, including the performance of any tax reporting
obligations with respect to the Trust or the Securityholders.
Section 9.4. Liquidation.
(a) If an Early Termination Event specified in clause (a), (b) or (d) of
Section 9.2 occurs prior to the Expiration Date, the Trust shall be liquidated
by the Trustees as expeditiously as the Trustees determine to be possible by
distributing, after satisfaction of liabilities to creditors of the Trust as
provided by applicable law, to each Securityholder a Like Amount of Debentures,
subject to Section 9.4(d). Notice of liquidation shall be given by the Property
Trustee by first-class mail, postage prepaid mailed not later than 30 nor more
than 60 days prior to the Liquidation Date to each Holder of Trust Securities at
such Holder's address appearing in the Securities Register. All notices of
liquidation shall:
(i) state the CUSIP Number;
(ii) state the Liquidation Date;
(iii) state that from and after the Liquidation Date, the Trust
Securities will no longer be deemed to be Outstanding and any Trust
Securities Certificates not surrendered for exchange will be deemed to
represent a Like Amount of Debentures; and
(iv) provide such information with respect to the procedures by which
Holders may exchange Trust Securities Certificates for Debentures, or if
Section 9.4(d) applies, receive a Liquidation Distribution, as the
Administrative Trustees or the Property Trustee shall deem appropriate.
(b) Except where Section 9.2(c) or 9.4(d) applies, in order to effect the
liquidation of the Trust and distribution of the Debentures to Securityholders,
the Property Trustee shall establish a record date for such distribution (which
shall be not more than 45 days prior to the Liquidation Date) and, either itself
acting as exchange agent or through the appointment of a separate exchange
agent, shall establish such procedures as it shall deem appropriate to effect
the distribution of Debentures in exchange for the Outstanding Trust Securities
Certificates.
(c) Except where Section 9.2(c) or 9.4(d) applies, after the Liquidation
Date, (i) the Trust Securities will no longer be deemed to be Outstanding, (ii)
certificates representing a Like Amount of Debentures will be issued to Holders
of Trust Securities Certificates, upon surrender of such certificates to the
Administrative Trustees or their agent for exchange, (iii) the Depositor shall
use its reasonable best efforts to have the Debentures listed on the New York
Stock Exchange or on such other exchange, interdealer quotation system or self-
regulatory organization as the Preferred Securities are then listed, (iv) any
Trust Securities Certificates not so surrendered for exchange will be deemed to
represent a Like Amount of Debentures, accruing interest at the rate provided
for in the Debentures from the last Distribution Date on which a Distribution
was made on such Trust Securities Certificates until such certificates are so
surrendered (and until such certificates are so surrendered, no payments of
interest or principal will be made to Holders of Trust Securities Certificates
with respect to such Debentures) and (v) all rights of
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Securityholders holding Trust Securities will cease, except the right of such
Securityholders to receive Debentures upon surrender of Trust Securities
Certificates.
(d) In the event that, notwithstanding the other provisions of this Section
9.4, whether because of an order for dissolution entered by a court of competent
jurisdiction or otherwise, distribution of the Debentures in the manner provided
herein is determined by the Property Trustee not to be practical, the Trust
Property shall be liquidated, and the Trust shall be dissolved, wound-up or
terminated by the Property Trustee in such manner as the Property Trustee
determines. In such event, on the date of the dissolution, winding-up or other
termination of the Trust, Securityholders will be entitled to receive out of the
assets of the Trust available for distribution to Securityholders, after
satisfaction of liabilities to creditors of the Trust as provided by applicable
law, an amount equal to the Liquidation Amount per Trust Security plus
accumulated and unpaid Distributions thereon to the date of payment (such amount
being the "Liquidation Distribution"). If, upon any such dissolution, winding up
or termination, the Liquidation Distribution can be paid only in part because
the Trust has insufficient assets available to pay in full the aggregate
Liquidation Distribution, then, subject to the next succeeding sentence, the
amounts payable by the Trust on the Trust Securities shall be paid on a pro rata
basis (based upon Liquidation Amounts). The Holder of the Common Securities will
be entitled to receive Liquidation Distributions upon any such dissolution,
winding-up or termination pro rata (determined as aforesaid) with Holders of
Preferred Securities, except that, if a Debenture Event of Default has occurred
and is continuing, the Preferred Securities shall have priority over the Common
Securities.
Section 9.5. Mergers, Consolidations, Amalgamations or Replacements of the
Trust.
The Trust may not merge with or into, consolidate, amalgamate, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any Person or other body, except pursuant to
this Section 9.5. At the request of the Depositor, with the consent of the
Administrative Trustees and without the consent of the Holders of the Preferred
Securities, the Property Trustee or the Delaware Trustee, the Trust may merge
with or into, consolidate, amalgamate, or be replaced by or convey, transfer or
lease its properties and assets substantially as an entirety to a trust
organized as such under the laws of any State; provided, that (i) such successor
entity either (a) expressly assumes all of the obligations of the Trust with
respect to the Preferred Securities or (b) substitutes for the Preferred
Securities other securities having substantially the same terms as the Preferred
Securities (the "Successor Securities") so long as the Successor Securities rank
the same as the Preferred Securities rank in priority with respect to
distributions and payments upon liquidation, redemption and otherwise, (ii) the
Depositor expressly appoints a trustee of such successor entity possessing the
same powers and duties as the Property Trustee as the Holder of the Debentures,
(iii) the Successor Securities are listed or traded, or any Successor Securities
will be listed upon notification of issuance, on any national securities
exchange or other organization on which the Preferred Securities are then listed
or traded, if any, (iv) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not cause the Preferred Securities (including
any Successor Securities) to be downgraded by any nationally recognized
statistical rating organization, (v) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not adversely affect the rights,
preferences and privileges of the Holders of the Preferred Securities (including
any
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Successor Securities) in any material respect, (vi) such successor entity has a
purpose identical to that of the Trust, (vii) prior to such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease, the
Depositor has received an Opinion of Counsel to the effect that (a) such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease does not
adversely affect the rights, preferences and privileges of the holders of the
Preferred Securities (including any Successor Securities) in any material
respect, and (b) following such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, (1) neither the Trust nor such
successor entity will be required to register as an investment company under the
1940 Act or (2) the Trust or such successor entity will continue to be
classified other than as an association taxable as a Corporation for United
States federal income tax purposes, and (viii) the Depositor or any permitted
successor or assignee owns all of the Common Securities of such successor entity
and guarantees the obligations of such successor entity under the Successor
Securities at least to the extent provided by the Guarantee. Notwithstanding the
foregoing, the Trust shall not, except with the consent of holders of 100% in
Liquidation Amount of the Preferred Securities, consolidate, amalgamate, merge
with or into, or be replaced by or convey, transfer or lease its properties and
assets substantially as an entirety to any other entity or permit any other
entity to consolidate, amalgamate, merge with or into, or replace it if such
consolidation, amalgamation, merger, replacement, conveyance, transfer or lease
would cause the Trust or the successor entity to be classified as an association
taxable as a corporation or as other than a grantor trust for United States
federal income tax purposes.
ARTICLE X.
Miscellaneous Provisions
Section 10.1. Limitation of Rights of Securityholders.
The death or incapacity, liquidation, dissolution, termination or
bankruptcy of any Person having an interest, beneficial or otherwise, in Trust
Securities shall not operate to terminate this Trust Agreement, nor entitle the
legal representatives or heirs of such person or any Securityholder for such
Person, to claim an accounting, take any action or bring any proceeding in any
court for a partition or winding up of the arrangements contemplated hereby, nor
otherwise affect the rights, obligations and liabilities of the parties hereto
or any of them.
Section 10.2. Amendment.
(a) This Trust Agreement may be amended from time to time by the Property
Trustee, the Administrative Trustees and the Depositor, without the consent of
any Securityholders, (i) to cure any ambiguity, correct or supplement any
provision herein which may be inconsistent with any other provision herein, or
to make any other provisions with respect to matters or questions arising under
this Trust Agreement, which shall not be inconsistent with the other provisions
of this Trust Agreement or (ii) to modify, eliminate or add to any provisions of
this Trust Agreement to such extent as shall be necessary to ensure that the
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Trust will be classified for United States federal income tax purposes as a
grantor trust or as other than an association taxable as a corporation at all
times that any Trust Securities are outstanding or to ensure that the Trust will
not be required to register as an investment company under the 1940 Act;
provided, however, that such action shall not adversely affect in any material
respect the interests of any Securityholder, and any amendments of this Trust
Agreement shall become effective when notice thereof is given to the
Securityholders.
(b) Except as provided in Section 10.2(c) hereof, any provision of this
Trust Agreement may be amended by the Administrative Trustees and the Depositor
with (i) the consent of Trust Securityholders representing not less than a
majority (based upon Liquidation Amounts) of the Preferred Securities then
Outstanding and (ii) receipt by the Trustees of an Opinion of Counsel to the
effect that such amendment or the exercise of any power granted to the Trustees
in accordance with such amendment will not cause the Trust to be classified as
an association taxable as a corporation or affect the Trust's status as a
grantor trust for United States federal income tax purposes or the Trust's
exemption from status of an investment company under the 1940 Act.
(c) In addition to and notwithstanding any other provision in this Trust
Agreement, without the consent of each affected Securityholder (such consent
being obtained in accordance with Section 6.3 or 6.6 hereof), this Trust
Agreement may not be amended to (i) change the amount or timing of any
Distribution on the Trust Securities or otherwise adversely affect the amount of
any Distribution required to be made in respect of the Trust Securities as of a
specified date or (ii) restrict the right of a Securityholder to institute suit
for the enforcement of any such payment on or after such date; notwithstanding
any other provision herein, without the unanimous consent of the Securityholders
(such consent being obtained in accordance with Section 6.3 or 6.6 hereof), this
paragraph (c) of this Section 10.2 may not be amended.
(d) Notwithstanding any other provisions of this Trust Agreement, no
Trustee shall enter into or consent to any amendment to this Trust Agreement
which would cause the Trust to fail or cease to qualify for the exemption from
status of an investment company under the 1940 Act or fail or cease to be
classified as a grantor trust or as other than an association taxable as a
corporation for United States federal income tax purposes.
(e) Notwithstanding anything in this Trust Agreement to the contrary,
without the consent of the Depositor, this Trust Agreement may not be amended in
a manner which imposes any additional obligation on the Depositor.
(f) In the event that any amendment to this Trust Agreement is made, the
Administrative Trustees shall promptly provide to the Depositor a copy of such
amendment.
(g) Neither the Property Trustee nor the Delaware Trustee shall be required
to enter into any amendment to this Trust Agreement which affects its own
rights, duties or immunities under this Trust Agreement. The Property Trustee
shall be entitled to receive an Opinion of Counsel and an Officers' Certificate
stating that any amendment to this Trust Agreement is in compliance with this
Trust Agreement.
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Section 10.3. Separability.
In case any provision in this Trust Agreement or in the Trust Securities
Certificates shall be invalid, illegal or unenforceable, the validity, legality
and enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.
Section 10.4. Governing Law.
THIS TRUST AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF EACH OF THE
SECURITYHOLDERS, THE TRUST AND THE TRUSTEES WITH RESPECT TO THIS TRUST AGREEMENT
AND THE TRUST SECURITIES SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
THE LAWS OF THE STATE OF DELAWARE.
Section 10.5. Payments Due on Non-Business Day.
If the date fixed for any payment on any Trust Security shall be a day that
is not a Business Day, then such payment need not be made on such date but may
be made on the next succeeding day that is a Business Day (except as otherwise
provided in Sections 4.1(a) and 4.2(d)), with the same force and effect as
though made on the date fixed for such payment, and no interest shall accrue
thereon for the period after such date.
Section 10.6. Successors.
This Trust Agreement shall be binding upon and shall inure to the benefit
of any successor to the Depositor, the Trust or the Relevant Trustee, including
any successor by operation of law. Except in connection with a consolidation,
merger or sale involving the Depositor that is permitted under Article VIII of
the Indenture and pursuant to which the assignee agrees in writing to perform
the Depositor's obligations hereunder, the Depositor shall not assign its
obligations hereunder.
Section 10.7. Headings.
The Article and Section headings are for convenience only and shall not
affect the construction of this Trust Agreement.
Section 10.8. Reports, Notices and Demands.
Any report, notice, demand or other communication which by any provision of
this Trust Agreement is required or permitted to be given or served to or upon
any Securityholder or the Depositor may be given or served in writing by deposit
thereof, first-class postage prepaid, in the United States mail, hand delivery
or facsimile transmission, in each case, addressed, (a) in the case of a
Preferred Securityholder, to such Preferred Securityholder as such
Securityholder's name and address may appear on the Securities Register; and (b)
in the case of the Common Securityholder or the Depositor, to Riggs National
Corporation, 1503 Pennsylvania Avenue, N.W., Washington, D.C. 20005, Attention:
Treasurer, facsimile no.: (202) 835-6773. Any notice
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to Preferred Securityholders shall also be given to such owners as have, within
two years preceding the giving of such notice, filed their names and addresses
with the Property Trustee for that purpose. Such notice, demand or other
communication to or upon a Securityholder shall be deemed to have been
sufficiently given or made, for all purposes, upon hand delivery, mailing or
transmission.
Any notice, demand or other communication which by any provision of this
Trust Agreement is required or permitted to be given or served to or upon the
Trust, the Property Trustee, the Delaware Trustee or the Administrative Trustees
shall be given in writing addressed (until another address is published by the
Trust) as follows: (a) with respect to the Property Trustee to The Bank of New
York, 101 Barclay Street, 21W, New York, New York 10286, Attention: Corporate
Trust Administration; (b) with respect to the Delaware Trustee, to The Bank of
New York (Delaware), White Clay Center, Route 273, Newark, Delaware 19711; and
(c) with respect to the Administrative Trustees, to them at the address above
for notices to the Depositor, marked "Attention: Administrative Trustees of
Riggs Capital". Such notice, demand or other communication to or upon the Trust
or the Property Trustee shall be deemed to have been sufficiently given or made
only upon actual receipt of the writing by the Trust or the Property Trustee.
Section 10.9. Agreement Not to Petition.
Each of the Trustees and the Depositor agree for the benefit of the
Securityholders that, until at least one year and one day after the Trust has
been terminated in accordance with Article IX, they shall not file, or join in
the filing of, a petition against the Trust under any bankruptcy, insolvency,
reorganization or other similar law (including, without limitation, the United
States Bankruptcy Code) (collectively, "Bankruptcy Laws") or otherwise join in
the commencement of any proceeding against the Trust under any Bankruptcy Law.
In the event the Depositor takes action in violation of this Section 10.9, the
Property Trustee agrees, for the benefit of Securityholders, that at the expense
of the Depositor, it shall file an answer with the bankruptcy court or otherwise
properly contest the filing of such petition by the Depositor against the Trust
or the commencement of such action and raise the defense that the Depositor has
agreed in writing not to take such action and should be stopped and precluded
therefrom and such other defenses, if any, as counsel for the Trustee or the
Trust may assert. The provisions of this Section 10.9 shall survive the
termination of this Trust Agreement.
Section 10.10. Trust Indenture Act; Conflict with Trust Indenture Act.
(a) This Trust Agreement is subject to the provisions of the Trust
Indenture Act that are required to be part of this Trust Agreement and shall, to
the extent applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is a trustee for
the purposes of the Trust Indenture Act.
(c) If any provision hereof limits, qualifies or conflicts with another
provision hereof which is required or deemed to be included in this Trust
Agreement by any of the provisions of
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the Trust Indenture Act, such required or deemed provision shall control. If any
provision of this Trust Agreement modifies or excludes any provision of the
Trust Indenture Act which may be so modified or excluded, the latter provision
shall be deemed to apply to this Trust Agreement as so modified or excluded, as
the case may be.
(d) The application of the Trust Indenture Act to this Trust Agreement
shall not affect the nature of the Trust Securities as equity securities
representing undivided beneficial interests in the assets of the Trust.
Section 10.11. Acceptance of Terms of Trust Agreement, Guarantee and
Indenture.
THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST THEREIN BY
OR ON BEHALF OF A SECURITYHOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY SIGNATURE
OR FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL
ACCEPTANCE BY THE SECURITYHOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN
SUCH TRUST SECURITY OF ALL THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT AND
AGREEMENT TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND
THE INDENTURE, AND SHALL CONSTITUTE THE AGREEMENT OF THE TRUST, SUCH
SECURITYHOLDER AND SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS TRUST
AGREEMENT SHALL BE BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE TRUST AND
SUCH SECURITYHOLDER AND SUCH OTHERS.
Section 10.12. Counterparts. This Trust Agreement may be executed in any
number of counterparts, each of which so executed shall be deemed to ba an
original, but all counterparts shall together constitute but one and the same
instrument.
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Riggs National Corporation
as Depositor
By: /s/John L. Davis
--------------------------------------
Name: John L. Davis
Title: Chief Financial Officer
The Bank of New York,
as Property Trustee
By: /s/Byron Merino
-------------------------------------
Name: Byron Merino
Title: Assistant Treasurer
The Bank of New York (Delaware),
as Delaware Trustee
By: /s/Joseph G. Ernst
--------------------------------------
Name: Joseph G. Ernst
Title: Assistant Vice President
/s/Timothy C. Coughlin
-----------------------------------------
Timothy C. Coughlin,
as Administrative Trustee
/s/Linda A. Madrid
------------------------------------------
Linda A. Madrid,
as Administrative Trustee
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EXHIBIT A
CERTIFICATE OF TRUST
OF
Riggs Capital
This Certificate of Trust of Riggs Capital (the "Trust"), dated November
15, 1996, is being duly executed and filed by the undersigned, as trustees, to
form a business trust under the Delaware Business Trust Act (12 Del. C. ((S))
3801 et seq.).
1. Name. The name of the business trust being formed hereby is Riggs
Capital.
2. Delaware Trustee. The name and business address of the trustee of the
Trust with a principal place of business in the State of Delaware are The Bank
of New York (Delaware), White Clay Center, Route 273, Newark, Delaware 19711.
3. Effective Date. This Certificate of Trust shall be effective as of
November 15, 1996.
In Witness Whereof, the undersigned, being the trustees of the Trust, have
executed this Certificate of Trust as of the date first above written.
The Bank of New York (Delaware),
as Trustee
By: /s/Melissa Beneduce
--------------------------------
Name: Melissa Beneduce
Title: Assistant Vice President
/s/Linda A. Madrid
------------------------------------
Linda A. Madrid,
as Administrative Trustee
/s/Timothy C. Coughlin
-----------------------------------
Timothy C. Coughlin,
as Administrative Trustee
<PAGE>
EXHIBIT B
THIS CERTIFICATE IS NOT TRANSFERABLE
CERTIFICATE NUMBER
NUMBER OF COMMON SECURITIES
C-1 [_____]
CERTIFICATE EVIDENCING COMMON SECURITIES
OF
RIGGS CAPITAL
8 5/8% TRUST COMMON SECURITIES, SERIES A
(LIQUIDATION AMOUNT $1,000 PER COMMON SECURITY)
Riggs Capital , a statutory business trust formed under the laws of the
State of Delaware (the "Trust"), hereby certifies that Riggs National
Corporation (the "Holder") is the registered owner of ____% ( ) common
securities of the Trust, representing beneficial interests of the Trust and
designated the ____% Trust Common Securities, Series A (liquidation amount
$1,000 per Common Security) (the "Common Securities"). The Common Securities are
not transferable and any attempted transfer hereof shall be void. The
designations, rights, privileges, restrictions, preferences and other terms and
provisions of the Common Securities are set forth in, and this certificate and
the Common Securities represented hereby are issued and shall in all respects be
subject to the terms and provisions of, the Amended and Restated Trust Agreement
of the Trust dated as of December 13, 1996, as the same may be amended from time
to time (the "Trust Agreement") including the designation of the terms of the
Common Securities as set forth therein. The Trust will furnish a copy of the
Trust Agreement to the Holder without charge upon written request to the Trust
at its principal place of business or registered office.
By receipt and acceptance of this certificate, the Holder agrees to be
bound by the Trust Agreement and is entitled to the benefits thereunder.
In Witness Whereof, one of the Administrative Trustees of the Trust has
executed this certificate this day of , 19 .
Riggs Capital
By:
_________________________________________
Name:
Administrative Trustee
<PAGE>
EXHIBIT C-1
GLOBAL RULE 144A PREFERRED SECURITY
The Preferred Securities evidenced hereby and any Debentures issuable in
connection therewith have not been registered under the U.S. Securities Act of
1933, as amended (the "Securities Act") and may not be offered, sold, pledged or
otherwise transferred except (A)(i) to a person whom the Seller reasonably
believes is a "Qualified Institutional Buyer" within the meaning of Rule 144A
under the Securities Act acquiring the Preferred Securities for its own account
or for the account of a Qualified Institutional Buyer in a transaction meeting
the requirements of Rule 144A, (ii) pursuant to an exemption from registration
under the Securities Act provided by Rule 144 thereunder (if available), (iii)
pursuant to an effective registration statement under the Securities Act, (iv)
in an offshore transaction complying with Rule 903 or Rule 904 of Regulation S
under the Securities Act or (v) to an institution that is an "accredited
investor" within the meaning of Rule 501(a) under the Securities Act in a
transaction exempt from the registration requirements of the Securities Act and
(B) in accordance with all applicable securities laws of the states of the
United States and other jurisdictions.
This Preferred Security is a Global Certificate within the meaning of the
Trust Agreement hereinafter referred to and is registered in the name of The
Depository Trust Company (the "Depositary") or a nominee of the Depositary. This
Preferred Security is exchangeable for Preferred Securities registered in the
name of a person other than the Depositary or its nominee only in the limited
circumstances described in the Trust Agreement and no transfer of this Preferred
Security (other than a transfer of this Preferred Security as a whole by the
Depositary to a nominee of the Depositary or by a nominee of the Depositary to
the Depositary or another nominee of the Depositary) may be registered except in
limited circumstances.
Unless this Preferred Security is presented by an authorized representative
of The Depository Trust Company (55 Water Street, New York) to Riggs Capital or
its agent for registration of transfer, exchange or payment, and any Preferred
Security issued is registered in the name of Cede & Co. or such other name as
requested by an authorized representative of The Depository Trust Company and
any payment hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL inasmuch as the registered
owner hereof, Cede & Co., has an interest herein.
<PAGE>
CERTIFICATE NUMBER
NUMBER OF PREFERRED SECURITIES
P-
CUSIP NO.
CERTIFICATE EVIDENCING PREFERRED SECURITIES
OF
RIGGS CAPITAL
8 5/8% TRUST PREFERRED SECURITIES,
SERIES A
(LIQUIDATION AMOUNT $1,000 PER PREFERRED SECURITY)
Riggs Capital , a statutory business trust formed under the laws of the
State of Delaware (the "Trust"), hereby certifies that (the "Holder")
is the registered owner of ( ) preferred securities of the Trust representing an
undivided beneficial interest in the assets of the Trust and designated the
Riggs Capital 8 5/8% Trust Preferred Securities, Series A (liquidation amount
$1,000 per Preferred Security) (the "Preferred Securities"). The Preferred
Securities are transferable on the books and records of the Trust, in person or
by a duly authorized attorney, upon surrender of this certificate duly endorsed
and in proper form for transfer as provided in Section 5.4 of the Trust
Agreement (as defined below). The designations, rights, privileges,
restrictions, preferences and other terms and provisions of the Preferred
Securities are set forth in, and this certificate and the Preferred Securities
represented hereby are issued and shall in all respects be subject to the terms
and provisions of, the Amended and Restated Trust Agreement of the Trust dated
as of December 13, 1996 as the same may be amended from time to time (the "Trust
Agreement") including the designation of the terms of Preferred Securities as
set forth therein. The Holder is entitled to the benefits of the Guarantee
Agreement entered into by Riggs National Corporation, a Delaware corporation,
and The Bank of New York, as guarantee trustee, dated as of December 13, 1996,
(the "Guarantee"), to the extent provided therein. The Trust will furnish a copy
of the Trust Agreement and the Guarantee to the Holder without charge upon
written request to the Trust at its principal place of business or registered
office.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
-2-
<PAGE>
In Witness Whereof, one of the Administrative Trustees of the Trust has
executed this certificate this day of , 19 .
Riggs Capital
By: _______________________________
Name:
Administrative Trustee
-3-
<PAGE>
ASSIGNMENT
For Value Received, the undersigned assigns and transfers this Preferred
Security to:
(Insert assignee's social security or tax identification number)
(Insert address and zip code of assignee)
and irrevocably appoints
agent to transfer this Preferred Security Certificate on the books of the Trust.
The agent may substitute another to act for him or her.
Date: ________________
Signature: ___________________________________________________________________
(Sign exactly as your name appears on the other side of this Preferred
Security Certificate)
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee medallion program), pursuant to
S.E.C. Rule 17Ad-15.
-4-
<PAGE>
EXHIBIT C-2
GLOBAL REGULATION S PREFERRED SECURITY
The Preferred Securities evidenced hereby and any Debentures issuable in
connection therewith have not been registered under the U.S. Securities Act of
1933 (the "Securities Act") and may not be offered, sold or delivered in the
United States or to, or for the account or benefit of, any U.S. person, unless
such Securities are registered under the Securities Act or an exemption from the
registration requirements thereof is available.
This Preferred Security is a Global Certificate within the meaning of the
Trust Agreement hereinafter referred to and is registered in the name of The
Depository Trust Company (the "Depositary") or a nominee of the Depositary. This
Preferred Security is exchangeable for Preferred Securities registered in the
name of a person other than the Depositary or its nominee only in the limited
circumstances described in the Trust Agreement and no transfer of this Preferred
Security (other than a transfer of this Preferred Security as a whole by the
Depositary to a nominee of the Depositary or by a nominee of the Depositary to
the Depositary or another nominee of the Depositary) may be registered except in
limited circumstances.
Unless this Preferred Security is presented by an authorized representative
of The Depository Trust Company (55 Water Street, New York) to Riggs Capital or
its agent for registration of transfer, exchange or payment, and any Preferred
Security issued is registered in the name of Cede & Co. or such other name as
requested by an authorized representative of The Depository Trust Company and
any payment hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL inasmuch as the registered
owner hereof, Cede & Co., has an interest herein.
<PAGE>
CERTIFICATE NUMBER
NUMBER OF PREFERRED SECURITIES
P-
CUSIP NO.
CERTIFICATE EVIDENCING PREFERRED SECURITIES
OF
RIGGS CAPITAL
8 5/8% TRUST PREFERRED SECURITIES,
SERIES A
(LIQUIDATION AMOUNT $1,000 PER PREFERRED SECURITY)
Riggs Capital , a statutory business trust formed under the laws of the
State of Delaware (the "Trust"), hereby certifies that (the
"Holder") is the registered owner of ( ) preferred securities of the Trust
representing an undivided beneficial interest in the assets of the Trust and
designated the Riggs Capital 8 5/8% Trust Preferred Securities, Series A
(liquidation amount $1,000 per Preferred Security) (the "Preferred Securities").
The Preferred Securities are transferable on the books and records of the Trust,
in person or by a duly authorized attorney, upon surrender of this certificate
duly endorsed and in proper form for transfer as provided in Section 5.4 of the
Trust Agreement (as defined below). The designations, rights, privileges,
restrictions, preferences and other terms and provisions of the Preferred
Securities are set forth in, and this certificate and the Preferred Securities
represented hereby are issued and shall in all respects be subject to the terms
and provisions of, the Amended and Restated Trust Agreement of the Trust dated
as of December 13, 1996 as the same may be amended from time to time (the "Trust
Agreement") including the designation of the terms of Preferred Securities as
set forth therein. The Holder is entitled to the benefits of the Guarantee
Agreement entered into by Riggs National Corporation, a Delaware corporation,
and The Bank of New York, as guarantee trustee, dated as of December 13, 1996,
(the "Guarantee"), to the extent provided therein. The Trust will furnish a copy
of the Trust Agreement and the Guarantee to the Holder without charge upon
written request to the Trust at its principal place of business or registered
office.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
-2-
<PAGE>
In Witness Whereof, one of the Administrative Trustees of the Trust has
executed this certificate this day of , 19 .
Riggs Capital
By: _______________________________
Name:
Administrative Trustee
-3-
<PAGE>
ASSIGNMENT
For Value Received, the undersigned assigns and transfers this Preferred
Security to:
(Insert assignee's social security or tax identification number)
(Insert address and zip code of assignee)
and irrevocably appoints
agent to transfer this Preferred Security Certificate on the books of the Trust.
The agent may substitute another to act for him or her.
Date: ________________
Signature: ___________________________________________________________________
(Sign exactly as your name appears on the other side of this Preferred
Security Certificate)
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee medallion program), pursuant to
S.E.C. Rule 17Ad-15.
-4-
<PAGE>
EXHIBIT C-3
OTHER PREFERRED SECURITY
CERTIFICATE NUMBER
NUMBER OF PREFERRED SECURITIES
P-
CUSIP NO.
CERTIFICATE EVIDENCING PREFERRED SECURITIES
OF
RIGGS CAPITAL
8 5/8% TRUST PREFERRED SECURITIES,
SERIES A
(LIQUIDATION AMOUNT $1,000 PER PREFERRED SECURITY)
Riggs Capital , a statutory business trust formed under the laws of the
State of Delaware (the "Trust"), hereby certifies that (the
"Holder") is the registered owner of ( ) preferred securities of the Trust
representing an undivided beneficial interest in the assets of the Trust and
designated the Riggs Capital 8 5/8% Trust Preferred Securities, Series A
(liquidation amount $1,000 per Preferred Security) (the "Preferred Securities").
The Preferred Securities are transferable on the books and records of the Trust,
in person or by a duly authorized attorney, upon surrender of this certificate
duly endorsed and in proper form for transfer as provided in Section 5.4 of the
Trust Agreement (as defined below). The designations, rights, privileges,
restrictions, preferences and other terms and provisions of the Preferred
Securities are set forth in, and this certificate and the Preferred Securities
represented hereby are issued and shall in all respects be subject to the terms
and provisions of, the Amended and Restated Trust Agreement of the Trust dated
as of December 13, 1996 as the same may be amended from time to time (the "Trust
Agreement") including the designation of the terms of Preferred Securities as
set forth therein. The Holder is entitled to the benefits of the Guarantee
Agreement entered into by Riggs National Corporation, a Delaware corporation,
and The Bank of New York, as guarantee trustee, dated as of December 13, 1996,
(the "Guarantee"), to the extent provided therein. The Trust will furnish a copy
of the Trust Agreement and the Guarantee to the Holder without charge upon
written request to the Trust at its principal place of business or registered
office.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
In Witness Whereof, one of the Administrative Trustees of the Trust has
executed this certificate this day of , 19 .
Riggs Capital
By: _______________________________
<PAGE>
Name:
Administrative Trustee
-2-
<PAGE>
ASSIGNMENT
For Value Received, the undersigned assigns and transfers this Preferred
Security to:
(Insert assignee's social security or tax identification number)
(Insert address and zip code of assignee)
and irrevocably appoints
agent to transfer this Preferred Security Certificate on the books of the Trust.
The agent may substitute another to act for him or her.
Date: ________________
Signature: ___________________________________________________________________
(Sign exactly as your name appears on the other side of this Preferred
Security Certificate)
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee medallion program), pursuant to
S.E.C. Rule 17Ad-15.
-3-
<PAGE>
EXHIBIT D -- FORM OF
REGULATION S CERTIFICATE
REGULATION S CERTIFICATE
(For transfers pursuant to (S) 5.4 of the Trust Agreement)
The Bank of New York,
as Securities Registrar
101 Barclay Street, 21W
New York, New York 10286
Attention: Corporate Trust Administration
Re: 8 5/8% Trust Preferred Securities, Series A, of Riggs Capital
(the "Trust") (the "Preferred Securities")
-------------------------------------------------------------
Reference is made to the Amended and Restated Trust Agreement, dated as of
December 13, 1996 (as amended from time to time, the "Trust Agreement"), entered
among Riggs National Corporation, as Depositor (the "Depositor"), The Bank of
New York, as Property Trustee, The Bank of New York (Delaware), as Delaware
Trustee, and the Administrative Trustees named therein. Terms used herein and
defined in the Trust Agreement or in Regulation S or Rule 144 under the U.S.
Securities Act of 1933 (the "Securities Act") are used herein as so defined.
This certificate relates to U.S. $____________ principal amount of
Preferred Securities, which are evidenced by the following certificate(s) (the
"Specified Securities"):
CUSIP No(s).
CERTIFICATE No(s). _____________________
The person in whose name this certificate is executed below (the "Undersigned")
hereby certifies that either (i) it is the sole beneficial owner of the
Specified Securities or (ii) it is acting on behalf of all the beneficial owners
of the Specified Securities and is duly authorized by them to do so. Such
beneficial owner or owners are referred to herein collectively as the "Owner".
If the Specified Securities are represented by a Global Preferred Security, they
are held through the Clearing Agency or a Clearing Agency Participant in the
name of the Undersigned, as or on behalf of the Owner. If the Specified
Securities are not represented by a Global Preferred Security, they are
registered in the name of the Undersigned, as or on behalf of the Owner.
The Owner has requested that the Specified Securities be transferred to a
person (the "Transferee") who will take delivery in the form of a Regulation S
Preferred Security. In connection with such transfer, the Owner hereby
certifies that, unless such transfer is being effected pursuant to an effective
registration statement under the Securities Act, it is being
<PAGE>
effected in accordance with Rule 904 or Rule 144 under the Securities Act and
with all applicable securities laws of the states of the United States and other
jurisdictions. Accordingly, the Owner hereby further certifies as follows:
(1) Rule 904 Transfers. If the transfer is being effected in
------------------
accordance with Rule 904:
(A) the Owner is not a distributor of the Preferred Securities,
an affiliate of the Trust or Depositor or any such distributor or a
person acting on behalf of any of the foregoing;
(B) the offer of the Specified Securities was not made to a
person in the United States;
(C) either:
(i) at the time the buy order was originated, the Transferee
was outside the United States or the Owner and any person acting
on its behalf reasonably believed that the Transferee was outside
the United States, or
(ii) the transaction is being executed in, on or through the
facilities of the Eurobond market, as regulated by the
Association of International Bond Dealers, or another designated
offshore securities market and neither the Owner nor any person
acting on its behalf knows that the transaction has been
prearranged with a buyer in the United States;
(D) no directed selling efforts have been made in the United
States by or on behalf of the Owner or any affiliate thereof;
(E) if the Owner is a dealer in securities or has received a
selling concession, fee or other remuneration in respect of the
Specified Securities, and the transfer is to occur during the
Restricted Period, then the requirements of Rule 904(c)(1) have been
satisfied; and
(F) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act.
(2) Rule 144 Transfers. If the transfer is being effected pursuant to
------------------
Rule 144:
(A) the transfer is occurring after a holding period of at least
two years (computed in accordance with paragraph (d) of Rule 144) has
elapsed since the Specified Securities were last acquired from the
Trust, the Depositor or from an affiliate of the Trust or the
Depositor, whichever is later, and is being effected in
-2-
<PAGE>
accordance with the applicable amount, manner of sale and notice
requirements of Rule 144; or
(B) the transfer is occurring after a holding period of at least
three years has elapsed since the Specified Securities were last
acquired from the Trust, the Depositor or from an affiliate of the
Trust or the Depositor, whichever is later, and the Owner is not, and
during the preceding three months has not been, an affiliate of the
Trust or the Depositor.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Depositor, the Trust and the Initial Purchasers.
Dated:
(Print the name of the Undersigned, as such term is
defined in the second paragraph of this certificate.)
By:__________________________________________________
Name:
Title:
(If the Undersigned is a corporation, partnership or
fiduciary, the title of the person signing on behalf of
the Undersigned must be stated.)
-3-
<PAGE>
EXHIBIT E -- FORM OF RESTRICTED
SECURITIES CERTIFICATE
SECURITIES CERTIFICATE
(For transfers pursuant to (S) 5.4 of the Trust Agreement)
The Bank of New York,
as Securities Registrar
101 Barclay Street, 21W
New York, New York 10286
Attention: Corporate Trust Administration
Re: 8 5/8% Trust Preferred Securities, Series A, of Riggs Capital
(the "Trust") (the "Preferred Securities")
-------------------------------------------------------------
Reference is made to the Amended and Restated Trust Agreement, dated as of
December 13, 1996 (as amended from time to time, the "Trust Agreement"), entered
among Riggs National Corporation, as Depositor (the "Depositor"), The Bank of
New York, as Property Trustee, The Bank of New York (Delaware), as Delaware
Trustee, and the Administrative Trustees named therein. Terms used herein and
defined in the Trust Agreement or in Rule 144A, Regulation D or Rule 144 under
the U.S. Securities Act of 1933 (the "Securities Act") are used herein as so
defined.
This certificate relates to $_____________ aggregate Liquidation Amount of
Preferred Securities, which are evidenced by the following certificate(s) (the
"Specified Securities"):
CUSIP No(s).
CERTIFICATE No(s). _____________________
The person in whose name this certificate is executed below (the "Undersigned")
hereby certifies that either (i) it is the sole beneficial owner of the
Specified Securities or (ii) it is acting on behalf of all the beneficial owners
of the Specified Securities and is duly authorized by them to do so. Such
beneficial owner or owners are referred to herein collectively as the "Owner".
If the Specified Securities are represented by a Global Preferred Security, they
are held through the Clearing Agency or a Clearing Agency Participant in the
name of the Undersigned, as or on behalf of the Owner. If the Specified
Securities are not represented by a Global Preferred Security, they are
registered in the name of the Undersigned, as or on behalf of the Owner.
<PAGE>
The Owner has requested that the Specified Securities be transferred to a
person (the "Transferee") who will take delivery in the form of a Rule 144A
Preferred Security or in the form of Definitive Preferred Securities. In
connection with such transfer, the Owner hereby certifies that, unless such
transfer is being effected pursuant to an effective registration statement under
the Securities Act, it is being effected in accordance with Rule 144A,
Regulation D or Rule 144 under the Securities Act and all applicable securities
laws of the states of the United States and other jurisdictions. Accordingly,
the Owner hereby further certifies as:
(1) Rule 144A Transfers. If the transfer is being effected in
-------------------
accordance with Rule 144A:
(A) the Specified Securities are being transferred to a person
that the Owner and any person acting on its behalf reasonably believe
is a "qualified institutional buyer" within the meaning of Rule 144A,
acquiring for its own account or for the account of a qualified
institutional buyer; and
(B) the Owner and any person acting on its behalf have taken
reasonable steps to ensure that the Transferee is aware that the Owner
may be relying on Rule 144A in connection with the transfer; and
(2) Regulation D Transfers. If the transfer is being effected in
----------------------
accordance with Regulation D:
(A) the Specified Securities are being transferred to a person
that the Owner and any person acting on its behalf reasonably believes
is an "accredited investor" within the meaning of Regulation D,
acquiring for its own account or for the account of an accredited
investor; and
(B) the Owner and any person acting on its behalf have taken
reasonable steps to ensure that the Transferee is aware that the Owner
may be relying on Regulation D in connection with the transfer; and
(3) Rule 144 Transfers. If the transfer is being effected pursuant to
------------------
Rule 144:
(A) the transfer is occurring after a holding period of at least
two years (computed in accordance with paragraph (d) of Rule 144) has
elapsed since the Specified Securities were last acquired from the
Trust or the Depositor or from an affiliate of the Trust or the
Depositor, whichever is later, and is being effected in accordance
with the applicable amount, manner of sale and notice requirements of
Rule 144; or
(B) the transfer is occurring after a holding period of at least
three years has elapsed since the Specified Securities were last
acquired from the Trust or the Depositor or from an affiliate of the
Trust or the Depositor, whichever is later, and
-2-
<PAGE>
the Owner is not, and during the preceding three months has not been,
an affiliate of the Trust or the Depositor.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Depositor, the Trust and the Initial Purchasers.
Dated: _____________________________________________________
(Print the name of the Undersigned, as such term is
defined in the second paragraph of this certificate.)
By:__________________________________________________
Name:
Title:
(If the Undersigned is a corporation, partnership or
fiduciary, the title of the person signing on behalf of
the Undersigned must be stated.)
-3-
<PAGE>
EXHIBIT F -- FORM OF UNRESTRICTED
SECURITIES CERTIFICATE
UNRESTRICTED SECURITIES CERTIFICATE
(For removal of Securities Act Legends pursuant to (S) 5.4(c) of the Trust
Agreement)
The Bank of New York,
as Securities Registrar
101 Barclay Street, 21W
New York, New York 10286
Attention: Corporate Trust Administration
Re: 8 5/8% Trust Preferred Securities, Series A, of Riggs Capital
(the "Trust") (the "Preferred Securities")
-------------------------------------------------------------
Reference is made to the Amended and Restated Trust Agreement, dated as of
December 13, 1996 (the "Trust Agreement"), entered among Riggs National
Corporation, as Depositor (the "Depositor"), The Bank of New York, as Property
Trustee, and The Bank of New York (Delaware), as Delaware Trustee. Terms used
herein and defined in the Trust Agreement or in Regulation S or Rule 144 under
the U.S. Securities Act of 1933 (the "Securities Act") are used herein as so
defined.
This certificate relates to $_____________ aggregate Liquidation Amount of
Preferred Securities, which are evidenced by the following certificate(s) (the
"Specified Securities"):
CUSIP No(s).
CERTIFICATE No(s). _____________________
The person in whose name this certificate is executed below (the "Undersigned")
hereby certifies that either (i) it is the sole beneficial owner of the
Specified Securities or (ii) it is acting on behalf of all the beneficial owners
of the Specified Securities and is duly authorized by them to do so. Such
beneficial owner or owners are referred to herein collectively as the "Owner".
If the Specified Securities are represented by a Global Securities Certificate,
they are held through the Clearing Agency or a Clearing Agency Participant in
the name of the Undersigned, as or on behalf of the Owner. If the Specified
Securities are not represented by a Global Preferred Security, they are
registered in the name of the Undersigned, as or on behalf of the Owner.
<PAGE>
The Owner has requested that the Specified Securities be exchanged for
Preferred Securities bearing no Restricted Preferred Securities Legend pursuant
to Section 5.4(c) of the Trust Agreement. In connection with such exchange, the
Owner hereby certifies that the exchange is occurring after a holding period of
at least three years (computed in accordance with paragraph (d) of Rule 144) has
elapsed since the Specified Securities were last acquired from the Trust, the
Depositor or from an affiliate of the Trust or the Depositor, whichever is
later, and the Owner is not, and during the preceding three months has not been,
an affiliate of the Trust or the Depositor. The Owner also acknowledges that any
future transfers of the Specified Securities must comply with all applicable
securities laws of the states of the United States and other jurisdictions.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company and the Purchasers.
Dated: _____________________________________________________
(Print the name of the Undersigned, as such term is
defined in the second paragraph of this certificate.)
By:__________________________________________________
Name:
Title:
(If the Undersigned is a corporation, partnership or
fiduciary, the title of the person signing on behalf of
the Undersigned must be stated.)
-2-
<PAGE>
- --------------------------------------------------------------------------------
GUARANTEE AGREEMENT
BETWEEN
RIGGS NATIONAL CORPORATION
(AS GUARANTOR)
AND
THE BANK OF NEW YORK
(AS TRUSTEE)
DATED AS OF
DECEMBER 13, 1996
- --------------------------------------------------------------------------------
<PAGE>
CROSS-REFERENCE TABLE*
<TABLE>
<CAPTION>
Section of
Trust Indenture Act Section of
of 1939, as amended Guarantee Agreement
- ------------------- -------------------
<S> <C>
310(a)............................................... 4.1(a)
310(b)............................................... 4.1(c), 2.8
310(c)............................................... Inapplicable
311(a)............................................... 2.2(b)
311(b)............................................... 2.2(b)
311(c)............................................... Inapplicable
312(a)............................................... 2.2(a)
312(b)............................................... 2.2(b)
313.................................................. 2.3
314(a)............................................... 2.4
314(b)............................................... Inapplicable
314(c)............................................... 2.5
314(d)............................................... Inapplicable
314(e)............................................... 1.1, 2.5, 3.2
314(f)............................................... 2.1, 3.2
315(a)............................................... 3.1(d)
315(b)............................................... 2.7
315(c)............................................... 3.1
315(d)............................................... 3.1(d)
316(a)............................................... 1.1, 2.6, 5.4
316(b)............................................... 5.3
316(c)............................................... 8.2
317(a)............................................... Inapplicable
317(b)............................................... Inapplicable
318(a)............................................... 2.1(b)
318(b)............................................... 2.1
318(c)............................................... 2.1(a)
</TABLE>
- ----------------
* This Cross-Reference Table does not constitute part of the Guarantee Agreement
and shall not affect the interpretation of any of its terms or provisions.
i
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
ARTICLE I. DEFINITIONS.......................................................... 1
Section 1.1. Definitions........................................................ 1
ARTICLE II. TRUST INDENTURE ACT................................................. 4
Section 2.1. Trust Indenture Act; Application................................... 4
Section 2.2. List of Holders.................................................... 4
Section 2.3. Reports by the Guarantee Trustee................................... 4
Section 2.4. Periodic Reports to Guarantee Trustee.............................. 4
Section 2.5. Evidence of Compliance with Conditions Precedent................... 4
Section 2.6. Events of Default; Waiver.......................................... 5
Section 2.7. Event of Default; Notice........................................... 5
Section 2.8. Conflicting Interests.............................................. 5
ARTICLE III. POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE................. 5
Section 3.1. Powers and Duties of the Guarantee Trustee......................... 5
Section 3.2. Certain Rights of Guarantee Trustee................................ 6
Section 3.3. Indemnity.......................................................... 8
ARTICLE IV. GUARANTEE TRUSTEE................................................... 8
Section 4.1. Guarantee Trustee; Eligibility..................................... 8
Section 4.2. Appointment, Removal and Resignation of the Guarantee Trustee...... 8
ARTICLE V. GUARANTEE........................................................... 9
Section 5.1. Guarantee.......................................................... 9
Section 5.2. Waiver of Notice and Demand........................................ 9
Section 5.3. Obligations Not Affected........................................... 9
Section 5.4. Rights of Holders.................................................. 10
Section 5.5. Guarantee of Payment............................................... 10
Section 5.6. Subrogation........................................................ 10
Section 5.7. Independent Obligations............................................ 10
ARTICLE VI. COVENANTS AND SUBORDINATION......................................... 11
Section 6.1. Subordination...................................................... 11
Section 6.2. Pari Passu Guarantees.............................................. 11
ARTICLE VII. TERMINATION......................................................... 11
Section 7.1. Termination........................................................ 11
ARTICLE VIII. MISCELLANEOUS...................................................... 11
Section 8.1. Successors and Assigns............................................. 11
Section 8.2. Amendments......................................................... 11
Section 8.3. Notices............................................................ 12
Section 8.4. Benefit............................................................ 12
Section 8.5. Interpretation..................................................... 13
Section 8.6. Governing Law...................................................... 13
</TABLE>
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GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT, dated as of December 13, 1996, is executed and
delivered by RIGGS NATIONAL CORPORATION, a Delaware corporation (the
"Guarantor") having its principal office at 1503 Pennsylvania Avenue, N.W.,
Washington, D.C., and THE BANK OF NEW YORK, a New York state banking
corporation, as trustee (the "Guarantee Trustee"), for the benefit of the
Holders (as defined herein) from time to time of the Preferred Securities (as
defined herein) of Riggs Capital, a Delaware statutory business trust (the
"Issuer").
WHEREAS, pursuant to an Amended and Restated Trust Agreement, dated as of
December 13, 1996 (the "Trust Agreement"), among the Guarantor, as Depositor,
the Property Trustee and the Delaware Trustee named therein and the Holders from
time to time of undivided beneficial interests in the assets of the Issuer, the
Issuer is issuing $150,000,000 aggregate Liquidation Amount (as defined in the
Trust Agreement) of its 8 6/8% Trust Preferred Securities, Series A (Liquidation
Amount $1,000 per preferred security) (the "Preferred Securities") representing
preferred undivided beneficial interests in the assets of the Issuer and having
the terms set forth in the Trust Agreement;
WHEREAS, the Preferred Securities will be issued by the Issuer and the
proceeds thereof, together with the proceeds from the issuance of the Issuer's
Common Securities (as defined below), will be invested in the Subordinated
Debentures (as defined in the Trust Agreement) of the Guarantor which will be
deposited with THE BANK OF NEW YORK, as Property Trustee under the Trust
Agreement, as trust assets; and
WHEREAS, as incentive for the Holders to purchase Preferred Securities, the
Guarantor desires irrevocably and unconditionally to agree, to the extent set
forth herein, to pay to the Holders of the Preferred Securities the Guarantee
Payments (as defined herein) and to make certain other payments on the terms and
conditions set forth herein.
NOW, THEREFORE, in consideration of the purchase by each Holder of Preferred
Securities, which purchase the Guarantor hereby agrees shall benefit the
Guarantor, the Guarantor executes and delivers this Guarantee Agreement for the
benefit of the Holders from time to time of the Preferred Securities.
ARTICLE I. DEFINITIONS
Section 1.1. Definitions.
As used in this Guarantee Agreement, the terms set forth below shall, unless
the context otherwise requires, have the following meanings. Capitalized or
otherwise defined terms used but not otherwise defined herein shall have the
meanings assigned to such terms in the Trust Agreement as in effect on the date
hereof.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person; provided, however, that an Affiliate of the
Guarantor shall not be deemed to be an Affiliate of the Issuer. For the purposes
of this definition, "control" when used with respect to any specified Person
means the power to direct the management and policies of such Person, directly
or indirectly, whether through the ownership of voting securities, by contract
or otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
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"Board of Directors" means either the board of directors of the Guarantor or
any committee of that board duly authorized to act hereunder.
"Common Securities" means the securities representing common undivided
beneficial interests in the assets of the Issuer.
"Debt" means with respect to any Person, whether recourse is to all or a
portion of the assets of such Person and whether or not contingent: (i) every
obligation of such Person for money borrowed; (ii) every obligation of such
Person evidenced by bonds, debentures, notes or other similar instruments,
including obligations incurred in connection with the acquisition of property,
assets or businesses; (iii) every reimbursement obligation of such Person with
respect to letters of credit, bankers' acceptances or similar facilities issued
for the account of such Person; (iv) every obligation of such Person issued or
assumed as the deferred purchase price of property or services (but excluding
trade accounts payable or accrued liabilities arising in the ordinary course of
business); (v) every capital lease obligation of such Person; (vi) all
indebtedness of such person whether incurred on or prior to the date of the
Indenture or thereafter incurred, for claims in respect of derivative products,
including interest rate, foreign exchange rate and commodity forward contracts,
options and swaps and similar arrangements; and (vii) every obligation of the
type referred to in clauses (i) through (vi) of another Person and all dividends
of another Person the payment of which, in either case, such Person has
guaranteed or is responsible or liable, directly or indirectly, as obligor or
otherwise.
"Event of Default" means a default by the Guarantor on any of its payment or
other obligations under this Guarantee Agreement; provided, however, that,
except with respect to a default in payment of any Guarantee Payments, the
Guarantor shall have received notice of default and shall not have cured such
default within 60 days after receipt of such notice.
"Guarantee Payments" means the following payments or distributions, without
duplication, with respect to the Preferred Securities, to the extent not paid or
made by or on behalf of the Issuer: (i) any accrued and unpaid Distributions (as
defined in the Trust Agreement) required to be paid on the Preferred Securities,
to the extent the Issuer shall have funds on hand available therefor at such
time, (ii) the redemption price, including all accrued and unpaid Distributions
to the date of redemption (the "Redemption Price"), with respect to any
Preferred Securities called for redemption by the Issuer, to the extent the
Issuer shall have funds on hand available therefor at such time, or (iii) upon a
voluntary or involuntary dissolution, winding-up or liquidation of the Issuer,
unless Subordinated Debentures are distributed to the Holders, the lesser of (a)
the aggregate of the Liquidation Amount of $1,000 per Preferred Security plus
accrued and unpaid Distributions on the Preferred Securities to the date of
payment and (b) the amount of assets of the Issuer remaining available for
distribution to Holders in liquidation of the Issuer after distribution of
liabilities of creditors of the Issuer as provided by applicable law (in either
case, the "Liquidation Distribution").
"Guarantee Trustee" means THE BANK OF NEW YORK, until a Successor Guarantee
Trustee has been appointed and has accepted such appointment pursuant to the
terms of this Guarantee Agreement, and thereafter means each such Successor
Guarantee Trustee.
"Holder" means any holder, as registered on the books and records of the
Issuer, of any Preferred Securities; provided, however, that in determining
whether the holders of the requisite percentage of Preferred Securities have
given any request, notice, consent or waiver hereunder, "Holder" shall not
include the Guarantor, the Guarantee Trustee, or any Affiliate of the Guarantor
or the Guarantee Trustee.
"Indenture" means the Junior Subordinated Indenture dated as of December 13,
1996, as supplemented and amended between the Guarantor and THE BANK OF NEW
YORK, as trustee.
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"List of Holders" has the meaning specified in Section 2.2(a).
"Majority in Liquidation Amount of the Preferred Securities" means, except as
provided by the Trust Indenture Act, a vote by the Holder(s), voting separately
as a class, of more than 50% of the Liquidation Amount of all then outstanding
Preferred Securities issued by the Issuer.
"Officers' Certificate" means, with respect to any Person, a certificate
signed by the Chairman or a Vice Chairman of the Board of Directors of such
Person or the President or a Vice President of such Person, and by the
Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary of
such Person, and delivered to the Guarantee Trustee. Any Officers' Certificate
delivered with respect to compliance with a condition or covenant provided for
in this Guarantee Agreement shall include:
(a) a statement that each officer signing the Officers' Certificate has read
the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Officers' Certificate;
(c) a statement that each officer has made such examination or investigation
as, in such officer's opinion, is necessary to enable such officer to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and
(d) a statement as to whether, in the opinion of each officer, such condition
or covenant has been complied with.
"Person" means a legal person, including any individual, corporation, estate,
partnership, joint venture, association, joint stock company, limited liability
company, trust, unincorporated association, or government or any agency or
political subdivision thereof, or any other entity of whatever nature.
"Responsible Officer" means, with respect to the Guarantee Trustee, any Senior
Vice President, any Vice President, any Assistant Vice President, the Treasurer,
any Assistant Treasurer, any Trust Officer or Assistant Trust Officer or any
other officer of the Corporate Trust Department of the Guarantee Trustee and
also means, with respect to a particular corporate trust matter, any other
officer to whom such matter is referred because of that officer's knowledge of
and familiarity with the particular subject.
"Senior Debt" means the principal of (and premium, if any) and interest, if
any (including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Guarantor whether or not such
claim for post-petition interest is allowed in such proceeding), on Debt,
whether incurred on or prior to the date of the Indenture or thereafter
incurred, unless, in the instrument creating or evidencing the same or pursuant
to which the same is outstanding, it is provided that such obligations are not
superior in right of payment to the Subordinated Debentures or to other Debt
which is pari passu with, or subordinated to, the Subordinated Debentures;
provided, however, that Senior Debt shall not be deemed to include: (i) any
Debt of the Guarantor which when incurred and without respect to any election
1111(b) of the United States Bankruptcy Code of 1978, as amended, was without
recourse to the Guarantor, (ii) any Debt of the Guarantor to any of its
subsidiaries and (iii) Debt to any employee of the Guarantor.
"Successor Guarantee Trustee" means a successor Guarantee Trustee possessing
the qualifications to act as Guarantee Trustee under Section 4.1.
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"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended.
ARTICLE II. TRUST INDENTURE ACT
Section 2.1. Trust Indenture Act; Application.
(a) This Guarantee Agreement is subject to the provisions of the Trust
Indenture Act that are required to be part of this Guarantee Agreement and
shall, to the extent applicable, be governed by such provisions.
(b) If and to the extent that any provision of this Guarantee Agreement
limits, qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.
Section 2.2. List of Holders.
(a) The Guarantor shall furnish or cause to be furnished to the Guarantee
Trustee semi-annually, on or before June 15 and December 15 of each year, a
list, in such form as the Guarantee Trustee may reasonably require, of the names
and addresses of the Holders ("List of Holders") as of a date not more than 15
days prior to the delivery thereof, and (b) at such other times as the Guarantee
Trustee may request in writing, within 30 days after the receipt by the
Guarantor of any such request, a List of Holders as of a date not more than 15
days prior to the time such list is furnished, in each case to the extent such
information is in the possession or control of the Guarantor and is not
identical to a previously supplied list of Holders or has not otherwise been
received by the Guarantee Trustee in its capacity as such. The Guarantee Trustee
may destroy any List of Holders previously given to it on receipt of a new List
of Holders.
(b) The Guarantee Trustee shall comply with its obligations under Section
311(a), Section 311(b) and Section 312(b) of the Trust Indenture Act.
Section 2.3. Reports by the Guarantee Trustee.
No later than within sixty days after May 15 of each year, commencing May 15,
1997, the Guarantee Trustee shall provide to the Holders such reports as are
required by Section 313 of the Trust Indenture Act, if any, in the form and in
the manner provided by Section 313 of the Trust Indenture Act. The Guarantee
Trustee shall also comply with the requirements of Section 313(d) of the Trust
Indenture Act.
Section 2.4. Periodic Reports to the Guarantee Trustee.
The Guarantor shall provide to the Guarantee Trustee, the Securities and
Exchange Commission and the Holders such documents, reports and information, if
any, as required by Section 314 of the Trust Indenture Act and the compliance
certificate required by Section 314 of the Trust Indenture Act, in the form, in
the manner and at the times required by Section 314 of the Trust Indenture Act.
Section 2.5. Evidence of Compliance with Conditions Precedent.
The Guarantor shall provide to the Guarantee Trustee such evidence of
compliance with such conditions precedent, if any, provided for in this
Guarantee Agreement that relate to any of the matters set forth in Section
314(c) of the Trust Indenture Act. Any certificate or opinion required to be
given by an officer pursuant to Section 314(c)(1) may be given in the form of an
Officers' Certificate.
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Section 2.6. Events of Default; Waiver.
The Holders of a Majority in Liquidation Amount of the Preferred Securities
may, by vote, on behalf of the Holders, waive any past Event of Default and its
consequences. Upon such waiver, any such Event of Default shall cease to exist,
and any Event of Default arising therefrom shall be deemed to have been cured,
for every purpose of this Guarantee Agreement, but no such waiver shall extend
to any subsequent or other default or Event of Default or impair any right
consequent therefrom.
Section 2.7. Event of Default; Notice.
(a) The Guarantee Trustee shall, within 90 days after the occurrence of an
Event of Default, transmit by mail, first class postage prepaid, to the Holders,
notices of all Events of Default actually known to the Guarantee Trustee, unless
such defaults have been cured before the giving of such notice, provided, that,
except in the case of a default in the payment of a Guarantee Payment, the
Guarantee Trustee shall be protected in withholding such notice if and so long
as the Board of Directors, the executive committee or a trust committee of
directors and/or Responsible Officers of the Guarantee Trustee in good faith
determines that the withholding of such notice is in the interests of the
Holders.
(b) The Guarantee Trustee shall not be deemed to have knowledge of any Event
of Default unless the Guarantee Trustee shall have received written notice, or a
Responsible Officer charged with the administration of this Guarantee Agreement
shall have obtained written notice, of such Event of Default.
Section 2.8. Conflicting Interests.
The Trust Agreement shall be deemed to be specifically described in this
Guarantee Agreement for the purposes of clause (i) of the first proviso
contained in Section 310(b) of the Trust Indenture Act.
ARTICLE III. POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE
Section 3.1. Powers and Duties of the Guarantee Trustee.
(a) This Guarantee Agreement shall be held by the Guarantee Trustee for the
benefit of the Holders, and the Guarantee Trustee shall not transfer this
Guarantee Agreement to any Person except a Holder exercising his or her rights
pursuant to Section 5.4(iv) or to a Successor Guarantee Trustee on acceptance by
such Successor Guarantee Trustee of its appointment to act as Successor
Guarantee Trustee. The right, title and interest of the Guarantee Trustee shall
automatically vest in any Successor Guarantee Trustee, upon acceptance by such
Successor Guarantee Trustee of its appointment hereunder, and such vesting and
cessation of title shall be effective whether or not conveyancing documents have
been executed and delivered pursuant to the appointment of such Successor
Guarantee Trustee.
(b) If an Event of Default has occurred and is continuing, the Guarantee
Trustee shall enforce this Guarantee Agreement for the benefit of the Holders.
(c) The Guarantee Trustee, before the occurrence of any Event of Default and
after the curing of all Events of Default that may have occurred, shall
undertake to perform only such duties as are specifically set forth in this
Guarantee Agreement, and no implied covenants shall be read into this Guarantee
Agreement against the Guarantee Trustee. In case an Event of Default has
occurred (that has not been cured or waived pursuant to Section 2.6), the
Guarantee Trustee shall exercise such of the rights and powers vested in it by
this Guarantee Agreement, and use
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the same degree of care and skill in its exercise thereof, as a prudent person
would exercise or use under the circumstances in the conduct of his or her own
affairs.
(d) No provision of this Guarantee Agreement shall be construed to relieve the
Guarantee Trustee from liability for its own negligent action, its own negligent
failure to act or its own willful misconduct, except that:
(i) prior to the occurrence of any Event of Default and after the curing
or waiving of all such Events of Default that may have occurred:
(A) the duties and obligations of the Guarantee Trustee shall be
determined solely by the express provisions of this Guarantee Agreement,
and the Guarantee Trustee shall not be liable except for the performance
of such duties and obligations as are specifically set forth in this
Guarantee Agreement; and
(B) in the absence of bad faith on the part of the Guarantee Trustee,
the Guarantee Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Guarantee Trustee and conforming
to the requirements of this Guarantee Agreement; but in the case of any
such certificates or opinions that by any provision hereof or of the Trust
Indenture Act are specifically required to be furnished to the Guarantee
Trustee, the Guarantee Trustee shall be under a duty to examine the same
to determine whether or not they conform to the requirements of this
Guarantee Agreement;
(ii) the Guarantee Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer of the Guarantee Trustee, unless
it shall be proved that the Guarantee Trustee was negligent in ascertaining
the pertinent facts upon which such judgment was made;
(iii) the Guarantee Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with the
direction of the Holders of not less than a Majority in liquidation preference
of the Preferred Securities relating to the time, method and place of
conducting any proceeding for any remedy available to the Guarantee Trustee,
or exercising any trust or power conferred upon the Guarantee Trustee under
this Guarantee Agreement; and
(iv) no provision of this Guarantee Agreement shall require the Guarantee
Trustee to expend or risk its own funds or otherwise incur personal financial
liability in the performance of any of its duties or in the exercise of any of
its rights or powers, if the Guarantee Trustee shall have reasonable grounds
for believing that the repayment of such funds or liability is not reasonably
assured to it under the terms of this Guarantee Agreement or adequate
indemnity against such risk or liability is not reasonably assured to it.
Section 3.2. Certain Rights of Guarantee Trustee.
(a) Subject to the provisions of Section 3.1:
(i) The Guarantee Trustee may rely and shall be fully protected in acting
or refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document
reasonably believed by it to be genuine and to have been signed, sent or
presented by the proper party or parties.
(ii) Any direction or act of the Guarantor contemplated by this Guarantee
Agreement shall be sufficiently evidenced by an Officers' Certificate unless
otherwise prescribed herein.
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(iii) Whenever, in the administration of this Guarantee Agreement, the
Guarantee Trustee shall deem it desirable that a matter be proved or
established before taking, suffering or omitting to take any action hereunder,
the Guarantee Trustee (unless other evidence is herein specifically
prescribed) may, in the absence of bad faith on its part, request and rely
upon an Officers' Certificate which, upon receipt of such request from the
Guarantee Trustee, shall be promptly delivered by the Guarantor.
(iv) The Guarantee Trustee may consult with legal counsel, and the written
advice or opinion of such legal counsel with respect to legal matters shall be
full and complete authorization and protection in respect of any action taken,
suffered or omitted to be taken by it hereunder in good faith and in
accordance with such advice or opinion. Such legal counsel may be legal
counsel to the Guarantor or any of its Affiliates and may be one of its
employees. The Guarantee Trustee shall have the right at any time to seek
instructions concerning the administration of this Guarantee Agreement from
any court of competent jurisdiction.
(v) The Guarantee Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Guarantee Agreement at the request
or direction of any Holder, unless such Holder shall have provided to the
Guarantee Trustee such adequate security and indemnity as would satisfy a
reasonable person in the position of the Guarantee Trustee, against the costs,
expenses (including attorneys' fees and expenses) and liabilities that might
be incurred by it in complying with such request or direction, including such
reasonable advances as may be requested by the Guarantee Trustee; provided
that, nothing contained in this Section 3.2(a)(v) shall be taken to relieve
the Guarantee Trustee, upon the occurrence of an Event of Default, of its
obligation to exercise the rights and powers vested in it by this Guarantee
Agreement.
(vi) The Guarantee Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document,
but the Guarantee Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit.
(vii) The Guarantee Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through its
agents or attorneys, and the Guarantee Trustee shall not be responsible for
any misconduct or negligence on the part of any such agent or attorney
appointed with due care by it hereunder.
(viii) Whenever in the administration of this Guarantee Agreement the
Guarantee Trustee shall deem it desirable to receive instructions with respect
to enforcing any remedy or right or taking any other action hereunder, the
Guarantee Trustee (A) may request instructions from the Holders, (B) may
refrain from enforcing such remedy or right or taking such other action until
such instructions are received, and (C) shall be protected in acting in
accordance with such instructions.
(b) No provision of this Guarantee Agreement shall be deemed to impose any
duty or obligation on the Guarantee Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it in any
jurisdiction in which it shall be illegal, or in which the Guarantee Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Guarantee Trustee
shall be construed to be a duty to act in accordance with such power and
authority.
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Section 3.3. Indemnity.
The Guarantor agrees to indemnify the Guarantee Trustee for, and to hold it
harmless against, any loss, liability or expense incurred without negligence or
bad faith on the part of the Guarantee Trustee, arising out of or in connection
with the acceptance or administration of this Guarantee Agreement, including the
costs and expenses of defending itself against any claim or liability in
connection with the exercise or performance of any of its powers or duties
hereunder. The Guarantee Trustee will not claim or exact any lien or charge on
any Guarantee Payments as a result of any amount due to it under this Guarantee
Agreement.
ARTICLE IV. GUARANTEE TRUSTEE
Section 4.1. Guarantee Trustee: Eligibility.
(a) There shall at all times be a Guarantee Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a Person that is eligible pursuant to the Trust Indenture Act to
act as such and has a combined capital and surplus of at least $50,000,000,
and shall be a corporation meeting the requirements of Section 310(a) of the
Trust Indenture Act. If such corporation publishes reports of condition at
least annually, pursuant to law or to the requirements of the supervising or
examining authority, then, for the purposes of this Section and to the extent
permitted by the Trust Indenture Act, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set
forth in its most recent report of condition so published.
(b) If at any time the Guarantee Trustee shall cease to be eligible to so act
under Section 4.1(a), the Guarantee Trustee shall immediately resign in the
manner and with the effect set out in Section 4.2(c).
(c) If the Guarantee Trustee has or shall acquire any "conflicting interest"
within the meaning of Section 310(b) of the Trust Indenture Act, the Guarantee
Trustee and Guarantor shall in all respects comply with the provisions of
Section 310(b) of the Trust Indenture Act.
Section 4.2. Appointment, Removal and Resignation of the Guarantee Trustee.
(a) Subject to Section 4.2(b), the Guarantee Trustee may be appointed or
removed without cause at any time by the Guarantor.
(b) The Guarantee Trustee shall not be removed until a Successor Guarantee
Trustee has been appointed and has accepted such appointment by written
instrument executed by such Successor Guarantee Trustee and delivered to the
Guarantor.
(c) The Guarantee Trustee appointed hereunder shall hold office until a
Successor Guarantee Trustee shall have been appointed or until its removal or
resignation. The Guarantee Trustee may resign from office (without need for
prior or subsequent accounting) by an instrument in writing executed by the
Guarantee Trustee and delivered to the Guarantor, which resignation shall not
take effect until a Successor Guarantee Trustee has been appointed and has
accepted such appointment by instrument in writing executed by such Successor
Guarantee Trustee and delivered to the Guarantor and the resigning Guarantee
Trustee.
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(d) If no Successor Guarantee Trustee shall have been appointed and accepted
appointment as provided in this Section 4.2 within 60 days after delivery to the
Guarantor of an instrument of resignation or removal, the Guarantee Trustee may
petition, at the expense of the Guarantor, any court of competent jurisdiction
for appointment of a Successor Guarantee Trustee. Such court may thereupon,
after prescribing such notice, if any, as it may deem proper, appoint a
Successor Guarantee Trustee.
ARTICLE V. GUARANTEE
Section 5.1. Guarantee.
The Guarantor irrevocably and unconditionally agrees to pay in full to the
Holders the Guarantee Payments (without duplication of amounts theretofore paid
by or on behalf of the Issuer), as and when due, regardless of any defense,
right of set-off or counterclaim which the Issuer may have or assert. The
Guarantor's obligation to make a Guarantee Payment may be satisfied by direct
payment of the required amounts by the Guarantor to the Holders or by causing
the Issuer to pay such amounts to the Holders.
Section 5.2. Waiver of Notice and Demand.
The Guarantor hereby waives notice of acceptance of the Guarantee Agreement
and of any liability to which it applies or may apply, presentment, demand for
payment, any right to require a proceeding first against the Guarantee Trustee,
Issuer or any other Person before proceeding against the Guarantor, protest,
notice of nonpayment, notice of dishonor, notice of redemption and all other
notices and demands.
Section 5.3. Obligations Not Affected.
The obligations, covenants, agreements and duties of the Guarantor under this
Guarantee Agreement shall in no way be affected or impaired by reason of the
happening from time to time of any of the following:
(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Issuer of any express or implied agreement,
covenant, term or condition relating to the Preferred Securities to be performed
or observed by the Issuer;
(b) the extension of time for the payment by the Issuer of all or any portion
of the Distributions (other than an extension of time for payment of
Distributions that results from the extension of any interest payment period on
the Subordinated Debentures as provided in the Indenture), Redemption Price,
Liquidation Distribution or any other sums payable under the terms of the
Preferred Securities or the extension of time for the performance of any other
obligation under, arising out of, or in connection with, the Preferred
Securities;
(c) any failure, omission, delay or lack of diligence on the part of the
Holders to enforce, assert or exercise any right, privilege, power or remedy
conferred on the Holders pursuant to the terms of the Preferred Securities, or
any action on the part of the Issuer granting indulgence or extension of any
kind;
(d) the voluntary or involuntary liquidation, dissolution, sale of any
collateral, receivership, insolvency, bankruptcy, assignment for the benefit of
creditors, reorganization, arrangement, composition or readjustment of debt of,
or other similar proceedings affecting, the Issuer or any of the assets of the
Issuer;
(e) any invalidity of, or defect or deficiency in, the Preferred Securities;
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(f) the settlement or compromise of any obligation guaranteed hereby or hereby
incurred; or
(g) any other circumstance whatsoever that might otherwise constitute a legal
or equitable discharge or defense of a guarantor, it being the intent of this
Section 5.3 that the obligations of the Guarantor hereunder shall be absolute
and unconditional under any and all circumstances.
There shall be no obligation of the Holders to give notice to, or obtain the
consent of, the Guarantor with respect to the happening of any of the foregoing.
Section 5.4. Rights of Holders.
The Guarantor expressly acknowledges that: (i) this Guarantee Agreement will
be deposited with the Guarantee Trustee to be held for the benefit of the
Holders; (ii) the Guarantee Trustee has the right to enforce this Guarantee
Agreement on behalf of the Holders; (iii) the Holders of a Majority in
liquidation preference of the Preferred Securities have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Guarantee Trustee in respect of this Guarantee Agreement or exercising any
trust or power conferred upon the Guarantee Trustee under this Guarantee
Agreement; and (iv) any Holder may institute a legal proceeding directly against
the Guarantor to enforce its rights under this Guarantee Agreement, without
first instituting a legal proceeding against the Guarantee Trustee, the Issuer
or any other Person.
Section 5.5. Guarantee of Payment.
This Guarantee Agreement creates a guarantee of payment and not of collection.
This Guarantee Agreement will not be discharged except by payment of the
Guarantee Payments in full (without duplication of amounts theretofore paid by
the Issuer) or upon distribution of Subordinated Debentures to Holders as
provided in the Trust Agreement.
Section 5.6. Subrogation.
The Guarantor shall be subrogated to all (if any) rights of the Holders
against the Issuer in respect of any amounts paid to the Holders by the
Guarantor under this Guarantee Agreement and shall have the right to waive
payment by the Issuer pursuant to Section 5.1; provided, however, that the
Guarantor shall not (except to the extent required by mandatory provisions of
law) be entitled to enforce or exercise any rights which it may acquire by way
of subrogation or any indemnity, reimbursement or other agreement, in all cases
as a result of payment under this Guarantee Agreement, if, at the time of any
such payment, any amounts are due and unpaid under this Guarantee Agreement. If
any amount shall be paid to the Guarantor in violation of the preceding
sentence, the Guarantor agrees to hold such amount in trust for the Holders and
to pay over such amount to the Holders.
Section 5.7. Independent Obligations.
The Guarantor acknowledges that its obligations hereunder are independent of
the obligations of the Issuer with respect to the Preferred Securities and that
the Guarantor shall be liable as principal and as debtor hereunder to make
Guarantee Payments pursuant to the terms of this Guarantee Agreement
notwithstanding the occurrence of any event referred to in subsections (a)
through (g), inclusive, of Section 5.3 hereof.
-10-
<PAGE>
ARTICLE VI. COVENANTS AND SUBORDINATION
Section 6.1. Subordination.
The obligations of the Guarantor under this Guarantee Agreement will
constitute unsecured obligations of the Guarantor and will rank subordinate and
junior in right of payment to all Senior Debt of the Guarantor except those made
pari passu or subordinate to such obligations expressly by their terms.
Section 6.2. Pari Passu Guarantees.
The obligations of the Guarantor under this Guarantee Agreement shall rank
pari passu with the obligations of the Guarantor under any similar Guarantee
Agreements issued by the Guarantor on behalf of the holders of preferred
securities issued by any Riggs Capital Trust (as defined in the Indenture).
ARTICLE VII. TERMINATION
Section 7.1. Termination.
This Guarantee Agreement shall terminate and be of no further force and effect
upon (i) full payment of the Redemption Price of all Preferred Securities, (ii)
full payment of the amounts payable in accordance with the Trust Agreement upon
liquidation of the Issuer or (iii) the distribution of Subordinated Debentures
to the Holders in exchange for all of the Preferred Securities. Notwithstanding
the foregoing, this Guarantee Agreement will continue to be effective or will be
reinstated, as the case may be, if at any time any Holder must restore payment
of any sums paid with respect to Preferred Securities or this Guarantee
Agreement.
ARTICLE VIII. MISCELLANEOUS
Section 8.1. Successors and Assigns.
All guarantees and agreements contained in this Guarantee Agreement shall bind
the successors, assigns, receivers, trustees and representatives of the
Guarantor and shall inure to the benefit of the Holders of the Preferred
Securities then outstanding. Except in connection with a consolidation, merger
or sale involving the Guarantor that is permitted under Article VIII of the
Indenture and pursuant to which the successor or assignee agrees in writing to
perform the Guarantor's obligations hereunder, the Guarantor shall not assign
its obligations hereunder.
Section 8.2. Amendments.
Except with respect to any changes which do not adversely affect the rights of
the Holders in any material respect (in which case no consent of the Holders
will be required), this Guarantee Agreement may be amended only with the prior
approval of the Holders of not less than a Majority in Liquidation Amount of the
Preferred Securities. The provisions of Article VI of the Trust Agreement
concerning meetings of the Holders shall apply to the giving of such approval.
-11-
<PAGE>
Section 8.3. Notices.
Any notice, request or other communication required or permitted to be given
hereunder shall be in writing, duly signed by the party giving such notice, and
delivered, telecopied or mailed by first class mail as follows:
(a) if given to the Guarantor, to the address set forth below or such other
address, facsimile number or to the attention of such other Person as the
Guarantor may give notice to the Holders:
Riggs National Corporation
1503 Pennsylvania Avenue, N.W.
Washington, D.C. 20005
Facsimile No.: 202-835-5346
Attention: Treasurer
(b) if given to the Issuer, in care of the Guarantee Trustee, at the Issuer's
(and the Guarantee Trustee's) address set forth below or such other address as
the Guarantee Trustee on behalf of the Issuer may give notice to the Holders:
Riggs Capital
c/o Riggs National Corporation
1503 Pennsylvania Avenue, N.W.
Washington, D.C. 20005
Facsimile No.: 202-835-5346
Attention: Treasurer
with a copy to:
THE BANK OF NEW YORK
101 Barclay Street
21 West
New York, N.Y. 10286
Facsimile No.: 212-815-5915
Attention: Corporate Trust Administration
(c) if given to any Holder, at the address set forth on the books and records
of the Issuer.
All notices hereunder shall be deemed to have been given when received in
person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid, except that if a notice or other document is refused delivery
or cannot be delivered because of a changed address of which no notice was
given, such notice or other document shall be deemed to have been delivered on
the date of such refusal or inability to deliver.
Section 8.4. Benefit.
This Guarantee Agreement is solely for the benefit of the Holders and is not
separately transferable from the Preferred Securities.
-12-
<PAGE>
Section 8.5. Interpretation.
In this Guarantee Agreement, unless the context otherwise requires:
(a) capitalized terms used in this Guarantee Agreement but not defined in the
preamble hereto have the respective meanings assigned to them in Section 1.1;
(b) a term defined anywhere in this Guarantee Agreement has the same meaning
throughout;
(c) all references to "the Guarantee Agreement" or "this Guarantee Agreement"
are to this Guarantee Agreement as modified, supplemented or amended from time
to time;
(d) all references in this Guarantee Agreement to Articles and Sections are to
Articles and Sections of this Guarantee Agreement unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same meaning when used
in this Guarantee Agreement unless otherwise defined in this Guarantee Agreement
or unless the context otherwise requires;
(f) a reference to the singular includes the plural and vice versa; and
(g) the masculine, feminine or neuter genders used herein shall include the
masculine, feminine and neuter genders.
Section 8.6. Governing Law.
THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICT
OF LAW PRINCIPLES THEREOF.
-13-
<PAGE>
This instrument may be executed in any number of counterparts, each of which
so executed shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.
THIS GUARANTEE AGREEMENT is executed as of the day and year first above
written.
RIGGS NATIONAL CORPORATION
By:_____________________________
Name:
Title:
THE BANK OF NEW YORK
as Guarantee Trustee
By:_____________________________
Name:
Title:
-14-
<PAGE>
Exhibit 4(i)
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES
ACT OF 1933 (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS
SECURITY, AGREES FOR THE BENEFIT OF THE SERIES A ISSUER THAT (A) THIS SECURITY
MAY NOT BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED OTHER THAN (1) TO THE SERIES
A ISSUER OR ANY AFFILIATE THEREOF, (2) SO LONG AS THIS SECURITY IS ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON
WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A, PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR
OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (3) IN AN "OFFSHORE
TRANSACTION" (AS DEFINED IN REGULATION S) IN ACCORDANCE WITH REGULATION S UNDER
THE SECURITIES ACT, (4) TO A PERSON THAT IS AN "ACCREDITED INVESTOR" AS DEFINED
IN RULE 501(A) UNDER THE SECURITIES ACT THAT IS ACQUIRING THIS SECURITY FOR
INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT,
(5) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED
BY RULE 144 (IF APPLICABLE) UNDER THE SECURITIES ACT OR (6) PURSUANT TO AN
EFFECTIVE REGISTRATION UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH
ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, OR ANY
APPLICABLE JURISDICTION, (B) IT WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO,
NOTIFY ANY PURCHASER FROM IT OF THIS SECURITY OF THE RESALE RESTRICTIONS SET
FORTH IN (A) ABOVE, AND (C) WITH RESPECT TO ANY TRANSFER OF THIS SECURITY BY AN
ACCREDITED INVESTOR OR IN AN "OFFSHORE TRANSACTION", IT WILL DELIVER TO THE
SERIES A ISSUER AND THE PROPERTY TRUSTEE SUCH CERTIFICATES, LEGAL OPINIONS AND
OTHER INFORMATION AS THEY MAY REQUIRE TO CONFIRM THAT THE TRANSFER BY IT
COMPLIES WITH APPLICABLE LAW. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY,
REPRESENTS AND AGREES FOR THE BENEFIT OF THE SERIES A ISSUER THAT IT IS (1) A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A OR (2) A PERSON
THAT IS AN "ACCREDITED INVESTOR" AS DEFINED IN RULE 501(A) UNDER THE SECURITIES
ACT THAT IS HOLDING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR (3) NOT A U.S. PERSON AND
THAT IT IS OUTSIDE THE UNITED STATES WITHIN THE MEANING OF, OR AN ACCOUNT
SATISFYING THE REQUIREMENTS OF, PARAGRAPH (O) OF RULE 902 UNDER REGULATION S
UNDER THE SECURITIES ACT. THIS SECURITY WILL BE ISSUED, AND MAY BE TRANSFERRED,
ONLY IN BLOCKS HAVING A LIQUIDATION AMOUNT OF NOT LESS THAN $100,000. ANY
TRANSFER, SALE OR OTHER DISPOSITION OF THIS SECURITY IN A BLOCK HAVING A
LIQUIDATION AMOUNT OF LESS THAN $100,000 SHALL BE DEEMED TO BE VOID AND OF NO
LEGAL EFFECT WHATSOEVER. ANY SUCH TRANSFEREE SHALL BE DEEMED NOT TO BE THE
HOLDER OF SUCH SECURITIES FOR ANY PURPOSE, INCLUDING BUT NOT LIMITED TO THE
RECEIPT OF INTEREST ON SUCH SECURITIES, AND SUCH TRANSFEREE SHALL BE DEEMED TO
HAVE NO INTEREST WHATSOEVER IN SUCH SECURITIES.
<PAGE>
THE HOLDER, BY PURCHASING THIS SECURITY, IS DEEMED TO REPRESENT THAT IT (X)
IS NOT ITSELF, AND IS NOT ACQUIRING THE SECURITY WITH THE ASSETS OF, (i) AN
"EMPLOYEE BENEFIT PLAN" (WITHIN THE MEANING OF SECTION 3 (3) OR ERISA), A "PLAN"
(WITHIN THE MEANING OF SECTION 4975 (e)(i) OF THE INTERNAL REVENUE CODE), OR AN
ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY REASON OF INVESTMENT IN
THE ENTITY BY SUCH AN "EMPLOYEE BENEFIT PLAN" OR "PLAN" AND THE APPLICATION OF
THE PLAN ASSET REGULATION OR (ii) A "GOVERNMENTAL PLAN" (WITHIN THE MEANING OF
SECTION 3 (32) OF ERISA) OR (Y) (i) IS ITSELF, OR IS ACQUIRING THE SECURITY WITH
THE ASSETS OF, AN "INVESTMENT FUND" (WITHIN THE MEANING OF PART V (b) OF U.S.
DEPARTMENT OF LABOR PTE 84-14) MANAGED BY A "QUALIFIED PROFESSIONAL ASSET
MANAGER" (WITHIN THE MEANING OF PART V (a) OF PTE 84-14) WHICH HAS MADE OR
PROPERLY AUTHORIZED THE DECISION FOR SUCH FUND TO PURCHASE THE SECURITIES, UNDER
CIRCUMSTANCES SUCH THAT PTE 84-14 IS APPLICABLE TO THE PURCHASE AND HOLDING OF
SUCH SECURITIES, (ii) IS AN INSURANCE COMPANY POOLED SEPARATE ACCOUNT PURCHASING
SECURITIES PURSUANT TO PART I OF U.S. DEPARTMENT OF LABOR PTE 90-1 OR A BANK
COLLECTIVE INVESTMENT FUND PURCHASING PURSUANT TO PART I OF U.S. DEPARTMENT OF
LABOR PTE 91-38, AND IN EITHER CASE, NO "PLAN" OR "EMPLOYEE BENEFIT PLAN" NOT
PURCHASING PURSUANT TO PTE 84-14 OWNS MORE THAN 10% OF THE ASSETS OF SUCH
ACCOUNT OR COLLECTIVE FUND (WHEN AGGREGATED WITH OTHER PLANS OF THE SAME
EMPLOYER OR EMPLOYEE ORGANIZATION, (iii) IS AN INSURANCE COMPANY USING THE
ASSETS OF THE GENERAL ASSET ACCOUNT OF THE INSURANCE COMPANY TO PURCHASE THE
SECURITIES PURSUANT TO PART I OF THE U.S. DEPARTMENT OF LABOR PTE 95-60, IN
WHICH CASE THE RESERVES AND LIABILITIES FOR THE GENERAL ACCOUNT CONTRACTS HELD
BY OR ON BEHALF OF ANY PLAN, TOGETHER WITH ANY OTHER PLANS MAINTAINED BY THE
SAME EMPLOYER OR EMPLOYEE ORGANIZATION, DO NOT EXCEED 10% OF THE TOTAL RESERVES
AND LIABILITIES OF THE INSURANCE COMPANY GENERAL ACCOUNT (EXCLUSIVE OF SEPARATE
ACCOUNT LIABILITIES), PLUS SURPLUS AS SET FORTH IN THE NATIONAL ASSOCIATION OF
INSURANCE COMMISSIONERS ANNUAL STATEMENT FILED WITH THE STATE OF DOMICILE OF
THE INSURER OR (IV) IS A PLAN ACQUIRING THE SERIES A PREFERRED SECURITIES WITH
ASSETS OVER WHICH AN IN-HOUSE ASSET MANAGER (WITHIN THE MEANING OF PART IV (a)
OF PTE 96-23) HAS DISCRETIONARY AUTHORITY, UNDER CIRCUMSTANCES SUCH THAT PTE
96-23 IS APPLICABLE TO THE PURCHASE AND HOLDING OF SUCH SECURITIES.
<PAGE>
RIGGS NATIONAL CORPORATION
8 5/8% JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURE,
SERIES A, DUE DECEMBER 31, 2026
No. $ 154,640,000
RIGGS NATIONAL CORPORATION, a corporation organized and existing under the
laws of Delaware (hereinafter called the "Corporation", which term includes any
successor corporation under the Indenture hereinafter referred to), for value
received, hereby promises to pay to Riggs Capital, or registered assigns, the
principal sum of One Hundred and Fifty-Four Million, Six Hundred and Forty
Thousand Dollars ($154,640,000) or such other principal amount as may be set
forth in the records of the Securities Registrar hereinafter referred to in
accordance with the Indenture, on December 31, 2026. The Corporation further
promises to pay interest on said principal sum from December 13, 1996 or from
the most recent date (each such date, an "Interest Payment Date") to which
interest has been paid or duly provided for, semi-annually (subject to deferral
as set forth herein) in arrears on June 30 and December 31 of each year,
commencing on June 30, 1997, at the rate of 8 5/8% per annum, until the
principal hereof shall have become due and payable, plus Additional Interest, if
any, until the principal hereof is paid or duly provided for or made available
for payment and on any overdue principal and (without duplication and to the
extent that payment of such interest is enforceable under applicable law) on any
overdue installment of interest at the rate of 8 5/8% per annum, compounded
semi-annually. The amount of interest payable for any period less than a full
interest period shall be computed on the basis of twelve 30-day months and a
360-day year. In the event that any date on which interest is payable on this
Security is not a Business Day, then a payment of the interest payable on such
date will be made on the next succeeding day which is a Business Day (and
without any interest or other payment in respect of any such delay), except
that, if such Business Day is in the next succeeding calendar year, such payment
shall be made on the immediately preceding Business Day, in each case with the
same force and effect as if made on the date the payment was originally payable.
A "Business Day" shall mean any day other than (i) a Saturday or Sunday, (ii) a
day on which banking institutions in The City of New York are authorized or
required by law or executive order to remain closed or (iii) a day on which the
Corporate Trust Office of the Trustee, or the principal office of the Property
Trustee under the Trust Agreement hereinafter referred to, for Riggs Capital, is
closed for business. The interest installment so payable, and punctually paid or
duly provided for, on any Interest Payment Date will, as provided in the
Indenture, be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered
<PAGE>
at the close of business on the Regular Record Date for such interest
installment, which shall be the June 15 or December 15 (whether or not a
Business Day) next preceding such Interest Payment Date. Any such interest
installment not so punctually paid or duly provided for shall forthwith cease to
be payable to the Holder on such Regular Record Date and may either be paid to
the Person in whose name this Security (or one or more Predecessor Securities)
is registered at the close of business on a Special Record Date for the payment
of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be
given to Holders of Securities not less than 10 days prior to such Special
Record Date, or be paid at any time in any other lawful manner not inconsistent
with the requirements of any securities exchange on which the Securities may be
listed, and upon such notice as may be required by such exchange, all as more
fully provided in said Indenture.
So long as no Event of Default has occurred and is continuing, the
Corporation shall have the right at any time during the term of this Security to
defer payment of interest on this Security, at any time or from time to time,
for up to 10 consecutive semi-annual interest payment periods with respect to
each deferral period (each an "Extension Period"), and at the end of which the
Corporation shall pay all interest then accrued and unpaid (together with
Additional Interest thereon to the extent permitted by applicable law);
provided, however, that no Extension Period shall extend beyond the Stated
Maturity of the principal of this Security; provided, further, that during any
such Extension Period, the Corporation shall not, and shall not permit any
Subsidiary of the Corporation to, (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire or make a liquidation payment
with respect to, any of the Corporation's capital stock or (ii) make any payment
of principal, interest or premium, if any, on or repay, repurchase or redeem any
indebtedness securities of the Corporation that rank pari passu with or junior
in interest to this Security or (iii) make any guarantee payments with respect
to any guarantee by the Corporation of the debt securities of any Subsidiary of
the Corporation if such guarantee ranks pari passu with or junior in interest to
this Security (other than (a) dividends or distributions in Common Stock of the
Corporation, (b) any declaration of a dividend in connection with the
implementation of a Rights Plan or the issuance of any Common Stock or any class
or series of preferred stock of the Corporation under any Rights Plan in the
future or the redemption or repurchase of any rights distributed pursuant to a
Rights Plan, (c) payments under the Riggs Capital Guarantee, and (d) purchases
of Common Stock related to the issuance of Common Stock or rights under any of
the Corporation's benefit plans for its directors, officers or employees). Prior
to the termination of any such Extension Period, the Corporation may further
defer the payment of interest, provided that no Extension Period shall exceed 10
consecutive semi-annual
<PAGE>
periods or extend beyond the Stated Maturity of the principal of this Security.
Upon the termination of any such Extension Period and upon the payment of all
amounts then due on any Interest Payment Date, the Corporation may elect to
begin a new Extension Period, subject to the above requirements. No interest
shall be due and payable during an Extension Period except at the end thereof.
The Corporation shall give the Property Trustee, the Administrative Trustee and
the Trustee notice of its election to begin any Extension Period at least one
Business Day prior to the earlier of (i) the date interest on the Securities
would have been payable except for the election to begin such Extension Period
or (ii) the date the Administrative Trustees are required to give notice to DTC
or an applicable self-regulatory organization or to holders of the Preferred
Securities as of the record date or the date Distributions on the Preferred
Securities are payable, but in any event not less than one Business Day prior to
such record date.
Payment of the principal of (and premium, if any) and interest on this
Security will be made at the office or agency of the Trustee in The City of New
York or at the offices of such Paying Agents or Agents as the Corporation may
designate from time to time outside the United States, in such coin or currency
of the United States of America as at the time of payment is legal tender for
payment of public and private indebtedness; provided, however, that at the
option of the Corporation, payment of interest may be made (i) by check mailed
to the address of the Person entitled thereto as such address shall appear in
the Securities Register or (ii) by wire transfer in immediately available funds
at such place and to such account as may be designated in writing at least 15
days prior to the relevant Interest Payment Date by the Person entitled thereto
as specified in the Securities Register.
The indebtedness evidence by this Security is, to the extent provided in
the Indenture, subordinate and junior in right of payment to the prior payment
in full of all Senior Debt, and this Security is issued subject to the
provisions of the Indenture with respect thereto. Each Holder hereof by
accepting the same, (a) agrees to and shall be bound by such provisions, (b)
authorizes and directs the Trustee on his behalf to take such actions as may be
necessary or appropriate to effectuate the subordination so provided and (c)
appoints the Trustee his attorney-in-fact for any and all such purposes. Each
Holder hereof, by his acceptance hereof, waives all notice of the acceptance of
the subordination provisions contained herein and in the Indenture by each
holder of Senior Debt, whether now outstanding or hereafter incurred, and waives
reliance by each such holder upon said provisions.
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further
<PAGE>
provisions shall for all purposes have the same effect as if set forth at this
place.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Corporation has caused this instrument to be duly
executed under its corporate seal.
RIGGS NATIONAL CORPORATION
By: /s/ Linda A. Madrid
-----------------------
Linda A. Madrid
Attest:
This Security is one of a duly authorized issue of securities of the
Corporation designated as its 8 5/8% Junior Subordinated Deferrable Interest
Debentures, Series A, Due December 31, 2026 (herein called the "Securities"),
limited in aggregate principal amount to $154,640,000, issued and to be issued
under a Junior Subordinated Indenture, dated as of December 13, 1996 (herein
called the "Indenture"), between the Corporation and The Bank of New York, as
Trustee (herein called the "Trustee", which term includes any successor trustee
under the Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights, limitations
of rights, duties and immunities thereunder of the Trustee, the Corporation and
the Holders of the Securities, and of the terms upon which the Securities are,
and are to be, authenticated and delivered. This Security is designated on the
face hereof, limited in aggregate principal amount to $154,640,000.
All terms used in this Security that are defined in the Indenture or in the
Amended and Restated Trust Agreement, dated as of December 13, 1996, as amended
(the "Trust Agreement"), for Riggs Capital, entered into among RIGGS NATIONAL
CORPORATION, as Depositor, and the Trustees named therein, shall have the
meanings assigned to them in the Indenture or the Trust Agreement, as the case
may be.
The Corporation may, at its option, on or after December 31, 2006, and
subject to the terms and conditions of Article XI of the Indenture, redeem this
Security in whole at any time or in part from time to time, at the following
<PAGE>
Redemption Prices (expressed as percentages of the principal amount), plus in
each case accrued interest thereon to the date of redemption. If redeemed during
the twelve-month period indicated,
Redemption Price
----------------
December 31, 2006 to December 31, 2007: 104.313%
December 31, 2007 to December 31, 2008: 103.881%
December 31, 2008 to December 31, 2009: 103.450%
December 31, 2009 to December 31, 2010: 103.019%
December 31, 2010 to December 31, 2011: 102.588%
December 31, 2011 to December 31, 2012: 102.156%
December 31, 2012 to December 31, 2013: 101.725%
December 31, 2013 to December 31, 2014: 101.294%
December 31, 2014 to December 31, 2015: 100.863%
December 31, 2015 to December 31, 2016: 100.431%
On or after December 31, 2016: 100%
At any time prior to December 31, 2006, upon the occurrence and during the
continuation of a Tax Event or Capital Treatment Event in respect of Riggs
Capital, the Corporation may, at its option, at any time within 90 days of the
occurrence of such Tax Event or Capital Treatment Event redeem the Securities,
in whole but not in part, subject to the provisions of Section 11.6 and the
other provisions of Article XI of the Indenture, at a redemption price equal to
the Make-Whole Amount plus, in each case, accrued and unpaid interest on the
Securities to the date fixed for redemption.
In the event of redemption of this Security in part only, a new Security or
Securities for the unredeemed portion thereof will be issued in the name of the
Holder hereof upon the cancellation hereof.
The Indenture contains provisions for satisfaction and discharge of the
entire indebtedness of this Security upon compliance by the Corporation with
certain conditions set forth in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the
Corporation and the Trustee at any time to enter into a supplemental indenture
or indentures for the purpose of modifying in any manner the rights and
obligations of the Corporation and of the Holders of the Securities, with the
consent of the Holders of not less than a majority in principal amount of the
Outstanding Securities to be affected by such supplemental indenture. The
Indenture also contains provisions permitting Holders of specified percentages
in principal amount of the Securities at the time Outstanding, on behalf of the
Holders of all Securities, to waive compliance by the Corporation with certain
provisions of the Indenture and certain past defaults under the Indenture and
their
<PAGE>
consequences. Any such consent or waiver by the Holder of this Security shall be
conclusive and binding upon such Holder and upon all future Holders of this
Security and of any Security issued upon the registration of transfer hereof or
in exchange herefor or in lieu hereof, whether or not notation of such consent
or waiver is made upon this Security.
As provided in and subject to the provisions of the Indenture, if an Event of
Default with respect to the Securities at the time Outstanding occurs and is
continuing, then and in every such case the Trustee or the Holders of not less
than 25% in principal amount of the Outstanding Securities may declare the
principal amount of all the Securities to be due and payable immediately, by a
notice in writing to the Corporation (and to the Trustee if given by Holders),
provided that, so long as the Securities are held by Riggs Capital, if upon an
Event of Default, the Trustee or the Holders of not less than 25% in principal
amount of the Outstanding Securities fails to declare the principal of all the
Securities to be immediately due and payable, the holders of at least 25% in
aggregate Liquidation Amount of the Preferred Securities of Riggs Capital then
outstanding shall have such right by a notice in writing to the Corporation and
the Trustee; and upon any such declaration the principal amount of and the
accrued interest (including any Additional Interest) on all the Securities shall
become immediately due and payable, provided that the payment of principal and
interest (including any Additional Interest) on such Securities shall remain
subordinated to the extent provided in Article XII of the Indenture.
No reference herein to the Indenture and no provision of this Security or of
the Indenture shall alter or impair the obligation of the Corporation, which is
absolute and unconditional, to pay the principal of (and premium, if any) and
interest on this Security at the times, place and rate, and in the coin or
currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Security is registrable in the Securities Register,
upon surrender of this Security for registration of transfer at the office or
agency of the Corporation maintained under Section 10.2 of the Indenture duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Corporation and the Securities Registrar duly executed by,
the Holder hereof or his attorney duly authorized in writing, and thereupon one
or more new Securities, of authorized denominations and for the same aggregate
principal amount, will be issued to the designated transferee or transferees. No
service charge shall be made for any such registration of transfer or exchange,
but the Corporation may require payment of a sum sufficient to cover any tax or
other governmental charge payable in connection therewith.
<PAGE>
Prior to due presentment of this Security for registration of transfer, the
Corporation, the Trustee and any agent of the Corporation or the Trustee shall
treat the Person in whose name this Security is registered as the owner hereof
for all purposes, whether or not this Security be overdue, and neither the
Corporation, the Trustee nor any such agent shall be affected by notice to the
contrary.
The Securities are issuable only in registered form without coupons in
minimum denominations of $100,000 and any integral multiples of $1,000 in excess
thereof. As provided in the Indenture and subject to certain limitations therein
set forth, Securities are exchangeable for a like aggregate principal amount of
Securities of a different authorized denomination, as requested by the Holder
surrendering the same.
The Corporation and, by its acceptance of this Security or a beneficial
interest therein, the Holder of, and any Person that acquires a beneficial
interest in, this Security agree that for United States federal, state and local
tax purposes it is intended that this Security constitute indebtedness.
THE INDENTURE AND THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE CONFLICT
OF LAW PRINCIPLES THEREOF.
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A
NOMINEE OF A DEPOSITORY. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED
IN THE NAME OF A PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE ONLY IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND MAY NOT BE TRANSFERRED
EXCEPT AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY
A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE
DEPOSITORY.
This is one of the Securities referred to in the within mentioned Indenture.
Dated: December 13, 1996
The Bank of New York,
as Trustee
By: /s/ Byron Merino
----------------------------
Byron Merino
<PAGE>
December 13, 1996
Dillon, Read & Co. Inc.,
535 Madison Avenue,
New York, NY 10022.
Friedman, Billings, Ramsey & Co., Inc.,
1001 19th Street,
Arlington, VA 22209.
Ladies and Gentlemen:
In connection with the several purchases today by you pursuant to the
Purchase Agreement, dated as of December 10, 1996 (the "Purchase Agreement"),
among Riggs National Corporation, a Delaware corporation (the "Corporation"),
Riggs Capital, a Delaware statutory business trust (the "Issuer Trust"), and
you, of 150,000 8 5/8% Trust Preferred Securities, Series A, Liquidation Amount
$1,000 per Preferred Security (the "Preferred Securities"), representing
preferred undivided beneficial interests in the assets of the Issuer Trust,
issued pursuant to the Amended and Restated Trust Agreement, dated as of
December 13, 1996 (the "Trust Agreement"), among the Corporation, as
<PAGE>
Dillon, Read & Co. Inc.,
Friedman, Billings, Ramsey & Co., Inc., -2-
Depositor, The Bank of New York, as Property Trustee, The Bank of New York
(Delaware), as Delaware Trustee (the "Issuer Trust Trustees"), the
Administrative Trustees, as named therein and the holders of the Preferred
Securities and the Common Securities (as defined therein) from time to time, and
guaranteed by the Corporation pursuant to the Guarantee Agreement, dated as of
December 13, 1996 (the "Guarantee Agreement"), between the Corporation and The
Bank of New York, as Trustee (the "Guarantee Trustee"), for the benefit of the
holders of the Preferred Securities from time to time, we, as special counsel
for the Corporation, have examined such corporate and trust records,
certificates and other documents, and such questions of law, as we have
considered necessary or appropriate for the purposes of this opinion. Upon the
basis of such examination, it is our opinion that:
(1) The Purchase Agreement has been duly authorized, executed and
delivered by the Corporation.
(2) The Trust Agreement has been duly authorized, executed and
delivered by the Corporation.
(3) The Registration Rights Agreement, dated December 13, 1996, among
the Corporation, the Issuer
<PAGE>
Dillon, Read & Co. Inc.,
Friedman, Billings, Ramsey & Co., Inc., -3-
Trust and you, has been duly authorized, executed and delivered by the
Corporation.
(4) The Guarantee Agreement has been duly authorized, executed and
delivered by the Corporation and constitutes a valid and legally binding
obligation of the Corporation enforceable against the Corporation in
accordance with its terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general
equity principles.
(5) The Agreement as to Expenses and Liabilities, dated December 13,
1996, between the Corporation and the Issuer Trust (the "Expense
Agreement"), has been duly authorized, executed and delivered by the
Corporation and constitutes a valid and legally binding obligation of the
Corporation enforceable against the Corporation in accordance with its
terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity
principles.
<PAGE>
Dillon, Read & Co. Inc.,
Friedman, Billings, Ramsey & Co., Inc., -4-
(6) The Junior Subordinated Indenture, dated as of December 13, 1996
(the "Indenture"), between the Corporation and The Bank of New York, as
Trustee (the "Debenture Trustee"), has been duly authorized, executed and
delivered by the Corporation and constitutes a valid and legally binding
obligation of the Corporation enforceable against the Corporation in
accordance with its terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general
equity principles.
(7) The 8 5/8% Junior Subordinated Deferrable Interest Debentures,
Series A, of the Corporation (the "Junior Subordinated Debentures"), issued
and sold to the Issuer Trust pursuant to the Indenture and the Trust
Agreement in an aggregate principal amount of $154,640,000, have been duly
authorized, executed and delivered by the Corporation and, when duly
authenticated in accordance with the Indenture and delivered and paid for
in accordance with the Purchase Agreement, will constitute valid and
legally binding obligations of the Corporation, entitled to the
<PAGE>
Dillon, Read & Co. Inc.,
Friedman, Billings, Ramsey & Co., Inc., -5-
benefits of the Indenture and enforceable against the Corporation in
accordance with their terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general
equity principles.
(8) The execution and delivery by the Corporation of, and the
performance by the Corporation under, the Purchase Agreement, the Trust
Agreement, the Indenture, the Guarantee Agreement, the Expense Agreement
and the Registration Rights Agreement, the consummation by the Corporation
of the transactions contemplated hereby and thereby, the filing of the
certificate of trust of the Issuer Trust with the Secretary of State of the
State of Delaware, compliance by the Corporation with the terms of the
foregoing and the application of the proceeds from the sale of the
Preferred Securities as contemplated by the Offering Memorandum do not and
will not (A) violate the charter or by-laws of the Corporation or its
subsidiary, Riggs Bank N.A. (the "Subsidiary") or (B) violate any federal
law of the United States or law of the State of New York or the General
Corporation Law of the State of Delaware
<PAGE>
Dillon, Read & Co. Inc.,
Friedman, Billings, Ramsey & Co., Inc., -6-
applicable to the Corporation or its Subsidiary; provided that, insofar as
--------
the performance by the Corporation of its obligations under the Indenture
and the Debentures is concerned, we express no opinion as to bankruptcy,
insolvency, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights.
(9) The Issuer Trust is not an "investment company" or an entity
"controlled" by an "investment company", as such terms are defined in the
Investment Company Act of 1940, as amended.
(10) The statements set forth in the Offering Memorandum, dated
December 10, 1996, relating to the Preferred Securities (the "Offering
Memorandum") under the captions "Description of the Series A Preferred
Securities", "Description of the Series A Subordinated Debentures",
"Description of the Series A Guarantee", "Relationship Among the Series A
Preferred Securities, the Series A Subordinated Debentures, the Expense
Agreement and the Series A Guarantee", and "ERISA Considerations" insofar
as they purport to describe the provisions of the laws and documents
referred to therein, are accurate, complete and fair.
<PAGE>
Dillon, Read & Co. Inc.,
Friedman, Billings, Ramsey & Co., Inc., -7-
(11) Assuming the accuracy of the representations and warranties and
compliance with the agreements of the Initial Purchasers in Section 3 of
the Purchase Agreement, neither registration of the Preferred Securities
under the Securities Act of 1933, as amended, nor qualification of the
Indenture, the Guarantee Agreement or the Trust Agreement under the Trust
Indenture Act of 1939, as amended, is required for the offer and sale of
the Preferred Securities by the Issuer Trust to you or the initial resale
of the Preferred Securities by you, in each case in accordance with the
Offering Memorandum and the Purchase Agreement. We express no opinion,
however, as to when or under what circumstances any Preferred Securities
sold by you may be reoffered or resold.
In connection with our opinion set forth in paragraph (11) above, we
have, with your approval, relied upon the representations, warranties and
agreements of the Corporation, the Issuer Trust and you in the Purchase
Agreement as to the absence of any general solicitation, general advertising or
directed selling efforts in connection with the offering of the Preferred
Securities,
<PAGE>
Dillon, Read & Co. Inc.,
Friedman, Billings, Ramsey & Co., Inc., -8-
the character of the offerees and the purchasers of the Preferred Securities and
certain other matters.
The foregoing opinion is limited to the Federal laws of the United
States and the laws of the State of New York, and we are expressing no opinion
as to the effect of the laws of any other jurisdiction. With respect to all
matters of Delaware law governing statutory business trusts, we have, with your
approval, relied upon the opinion, dated December 13, 1996, of Richards, Layton
& Finger, P.A., delivered to you pursuant to Section 6(f) of the Purchase
Agreement, and our opinion is subject to the same assumptions, qualifications
and limitations with respect to such matters as are contained in such opinion of
Richards, Layton & Finger, P.A. We believe you and we are justified in relying
on such opinion for such matters.
In connection with our opinion set forth in paragraphs (1) through (8)
above, we have relied, as to the due incorporation of the Company, upon the
opinion, dated the date hereof, of Linda A. Madrid, Esq., Managing Director of
Legal Affairs of the Company, delivered to you today pursuant to Section 6(b) of
the Purchase Agreement.
With your approval, we have relied as to certain matters on
information obtained from public officials,
<PAGE>
Dillon, Read & Co. Inc.,
Friedman, Billings, Ramsey & Co., Inc., -9-
officers of the Corporation, the Issuer Trust and you, and from other sources
believed by us to be responsible, and we have assumed that (i) the Indenture has
been duly authorized, executed and delivered by the Debenture Trustee, (ii) the
Trust Agreement has been duly authorized, executed and delivered by each of the
Property Trustee and the Delaware Trustee, (iii) the Guarantee Agreement has
been duly authorized, executed and delivered by the Guarantee Trustee, (iv) the
Junior Subordinated Debentures conform to the specimen thereof examined by us
and (v) the signatures on all documents examined by us are genuine, assumptions
which we have not independently verified.
Very truly yours,
<PAGE>
Exhibit 5(a)
February 6, 1997
Riggs National Corporation
1503 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
Ladies and Gentlemen:
We hereby consent to the two references to us under the heading "Validity
of Securities" in the Prospectus included in this Registration Statement and to
the filing of both of our related opinions, each dated December 13, 1996, as
exhibits to this Registration Statement on Form S-3 filed with the Securities
and Exchange Commission. In giving this consent, we do not hereby admit that we
are within the category of persons whose consent is required under Section 7 of
the Securities Act of 1933, as amended, or the rules and regulations of the
Securities and Exchange Commission thereunder.
Very truly yours,
SULLIVAN & CROMWELL
<PAGE>
[LETTERHEAD APPEARS HERE]
To Each of the Persons Listed
on Schedule I Hereto
Re: Riggs Capital
-------------
Ladies and Gentlemen:
We have acted as special Delaware counsel for Riggs National
Corporation, a Delaware corporation ("Riggs"), and Riggs Capital, a Delaware
business trust (the "Trust"), in connection with the matters set forth herein.
At your request, this opinion is being furnished to you.
For purposes of giving the opinions hereinafter set forth, our
examination of documents has been limited to the examination of originals or
copies of the following:
(a) The Certificate of Trust of the Trust, dated as of November 15,
1996 (the "Certificate"), as filed in the office of the Secretary
of State of the State of Delaware (the "Secretary of State") on
November 15, 1996;
(b) The Trust Agreement of the Trust, dated as of November 15, 1996,
as amended by the Amended and Restated Trust Agreement, dated as
of December 13, 1996 (including Exhibits D-1 through D-3 thereto)
(collectively, the "Trust Agreement"), among Riggs, the trustees
of the Trust named therein) (collectively, the "Trustees") and
the holders, from time to time, of undivided beneficial interests
in the Trust;
<PAGE>
To Each of the Persons Listed
on Schedule I Hereto
December 13, 1996
Page 2
(c) The Purchase Agreement, dated December 10, 1996 (the "Purchase
Agreement"), among the Trust, Riggs and the Purchasers named
therein (the "Purchasers");
(d) The Registration Rights Agreement, dated December 13, 1996, among
Riggs, the Trust and the Purchasers (the "Rights Agreement");
(e) The Offering Memorandum, dated December 10, 1996 (the "Offering
Memorandum"), relating to the 86/8% Trust Preferred Securities
of the Trust representing preferred undivided beneficial
interests in the assets of the Trust (each, a "Preferred
Security" and collectively, the "Preferred Securities"); and
(f) A Certificate of Good Standing for the Trust, dated December 12,
1996, obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise defined are
used as defined in the Trust Agreement.
For purposes of this opinion, we have not reviewed any documents other
than the documents listed in paragraphs (a) through (f) above. In particular, we
have not reviewed any document (other than the documents listed in paragraphs
(a) through (f) above) that is referred to in or incorporated by reference into
the documents reviewed by us. We have assumed that there exists no provision in
any document that we have not reviewed that is inconsistent with the opinions
stated herein. We have conducted no independent factual investigation of our own
but rather have relied solely upon the foregoing documents, the statements and
information set forth therein and the additional matters recited or assumed
herein, all of which we have assumed to be true, complete and accurate in all
material respects.
With respect to all documents examined by us, we have assumed (i) the
authenticity of all documents submitted to us as authentic originals, (ii) the
conformity with the originals of all documents submitted to us as copies or
forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the Trust
Agreement constitutes the entire agreement among the parties thereto with
respect to the subject matter thereof, including with respect to the creation,
operation, and termination of the Trust, and that the Trust Agreement and the
Certificate are in full force and effect and have not been amended, (ii) except
to the extent provided in paragraph 1 below, the due creation, due
<PAGE>
To Each of the Persons Listed
on Schedule I Hereto
December 13, 1996
Page 3
formation or due organization, as the case may be, and valid existence in good
standing of each party to the documents examined by us under the laws of the
jurisdiction governing its creation, formation or organization, (iii) the legal
capacity of each natural person who is a party to the documents examined by us,
(iv) except to the extent provided in paragraph 4 below, that each of the
parties to the documents examined by us has the power and authority to execute
and deliver, and to perform its obligations under, such documents, (v) except to
the extent provided in paragraph 5 below, that each of the parties to the
documents examined by us has duly authorized, executed and delivered such
documents, (vi) the receipt by each Person to whom a Preferred Security or a
common security (the "Common Securities", and together with the Preferred
Securities, the "Securities") is to be issued by the Trust (the "Holders") of a
Certificate for such Preferred Security and Common Security and the Payment for
the Preferred Security and Common Security acquired by it, in accordance with
the Trust Agreement and the Offering Memorandum, (vii) that the Preferred
Securities and the Common Securities are issued and sold to the Holders in
accordance with the Trust Agreement and the Offering Memorandum, (viii) that the
Trust derives no income from or connected with sources within the State of
Delaware and has no assets, activities (other than having a Delaware trustee as
required by the Delaware Business Trust Act and the filing of documents with the
Secretary of State) or employees in the State of Delaware, and (ix) that the
trust is treated as a grantor trust for federal income tax purposes. We have not
participated in the preparation of the Offering Memorandum and assume no
responsibility for its contents.
This opinion is limited to the laws of the State of Delaware
(excluding the securities laws of the State of Delaware) and we have not
considered and express no opinion on the laws of any other jurisdiction,
including federal laws and rules and regulations relating thereto. Our opinions
are rendered only with respect to Delaware laws and rules, regulations and
orders thereunder that are currently in effect.
Based upon the foregoing, and upon our examination of such questions
of law and statutes of the State of Delaware as we have considered necessary or
appropriate, and subject to the assumptions, qualifications, limitations and
exceptions set forth herein, we are of the opinion that:
1. The Trust had been duly created and is validly existing in good
standing as a business trust under the Delaware Business Trust Act, and all
filings required under the laws of the State of Delaware with respect to the
creation and valid existence of the Trust as a business trust have been made.
<PAGE>
To Each of the Persons Listed
on Schedule I Hereto
December 13, 1996
Page 4
2. Under the Delaware Business Trust Act and the Trust Agreement,
the Trust has the trust power and authority to own it property and conduct its
business, all as described in the Offering Memorandum.
3. The Trust Agreement constitutes a valid and binding obligation of
Riggs and the Trustees, and is enforceable against Riggs and the Trustees, in
accordance with its terms.
4. Under the Delaware Business Trust Act and the Trust Agreement,
the Trust has the trust power and authority (i) to execute and deliver, and to
perform its obligations under, the Purchase Agreement and the Rights Agreement,
and (ii) to issue and perform its obligations under the Securities.
5. Under the Delaware Business Trust Act and the Trust Agreement,
the execution and delivery by the Trust of the Purchase Agreement and the Rights
Agreement, and the performance by the Trust of its obligations thereunder, have
been duly authorized by all necessary trust action on the part of the Trust.
6. The Preferred Securities have been duly authorized by the Trust
Agreement and are duly and validly issued and, subject to the qualifications set
forth herein, fully paid and nonassessable undivided beneficial interests in the
assets of the Trust and are entitled to the benefits of the Trust Agreement. The
Holders of Preferred Securities, as beneficial owners of the Trust, will be
entitled to the same limitation of personal liability extended to stockholders
of private corporations for profit organized under the General Corporation Law
of the State of Delaware. We note that the Holders of Preferred Securities may
be obligated, pursuant to the Trust Agreement, (i) to provide indemnity and/or
security in connection with any pay taxes or governmental charges arising from
transfers or exchanges of Preferred Securities Certificates and the issuance of
replacement Preferred Securities Certificates, and (ii) to provide security or
indemnity in connection with requests of or directions to the Property Trustee
to exercise its rights and powers under the Trust Agreement.
7. Under the Delaware Business Trust Act and the Trust Agreement,
the issuance of the Preferred Securities is not subject to preemptive rights.
8. The issuance and sale by the Trust of the Preferred Securities,
the execution, delivery and performance by the Trust of the Purchase Agreement
and the Rights
<PAGE>
To Each of the Persons Listed
on Schedule I Hereto
December 13, 1996
Page 5
Agreement, the consummation by the Trust of the transactions contemplated
thereby and compliance by the Trust with its obligations thereunder, and the
performance by Rigss, as Sponsor, of its obligations under the Trust Agreement,
(A) do not violate (i) any of the provisions of the Certificate or the Trust
Agreement or (ii) any applicable Delaware law or administrative regulation
thereunder and (B) do not require any consent, approval, order, license or
validation of, filing or registration with, or authorization of any Delaware
court or Delaware governmental authority or agency under the laws or
administrative regulations of the State of Delaware.
9. The Holders of the Preferred Securities (other than those Holders
who reside or are domiciled in the State of Delaware) will have no liability for
income taxes imposed by the State of Delaware solely as a result of their
participation in the Trust, and the Trust will not be liable for any income tax
imposed by the State of Delaware.
10. The Common Securities have been duly authorized by the Trust
Agreement and are validly issued undivided beneficial interests in the assets of
the Trust.
The opinion expressed in paragraph 3 above is subject, as to
enforcement, to the effect upon the Trust Agreement of (i) bankruptcy,
insolvency, moratorium, receivership, reorganization, liquidation, fraudulent
transfer and other similar laws relating to or affecting the rights and remedies
of creditors generally, (ii) principles of equity, including applicable law
relating to fiduciary duties (regardless of whether considered and applied in
a proceeding in equity or at law), and (iii) the effect of applicable public
policy on the enforceability of provisions relating to indemnification or
contribution.
We consent to your relying as to matters of Delaware law upon this
opinion in connection with the Underwriting Agreement. We also consent to
Sullivan & Cromwell's and Simpson Thacher & Barlett's relying as to matters of
Delaware law upon this opinion in connection with opinions to be rendered by
them to the Purchasers pursuant to the Purchaser Agreement. We also consent to
the Property Trustee's relying as to matters to Delaware law upon this opinion
in connection with the Trust Agreement. Except as stated above, without our
prior written consent, this opinion may not be finished or quoted to, or relied
upon by, any other Person for any purpose.
Very truly yours,
EAM /s/ Richards, Layton and Finger
<PAGE>
Dillon, Read & Co. Inc.,
Friedman, Billings, Ramsey & Co., Inc., -1-
December 13, 1996
Dillon, Read & Co. Inc.,
535 Madison Avenue,
New York, NY 10022.
Friedman, Billings, Ramsey & Co., Inc.,
1001 19th Street,
Arlington, VA 22209.
Ladies and Gentlemen:
As special tax counsel to Riggs Capital, a statutory business trust
formed under the laws of Delaware (the "Issuer Trust"), and Riggs National
Corporation, a Delaware corporation, in connection with the issuance by the
Issuer Trust of $150,000,000 of its 8 5/8% Trust Preferred Securities, Series A
(the "Preferred Securities"), and assuming that the operative documents
described in the Offering Memorandum for the Preferred Securities dated December
10, 1996 (the "Offering Memorandum") will be performed in accordance with the
terms described therein, we hereby confirm to you our opinion as set forth in
the Offering Memorandum under the heading "Certain Federal Income Tax
Consequences", subject to the limitations set forth therein.
Very truly yours,
<PAGE>
Exhibit 12
RIGGS NATIONAL CORPORATION
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
AND PREFERRED STOCK DIVIDENDS
(Dollars in thousands)
<TABLE>
<CAPTION>
Nine Months
Ended
September 30, Year Ended December 31,
----------------------------------------------------------------------
1996 1995 1994 1993 1992 1991
-------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Income (Loss) before income taxes $ 55,466 $ 88,148 $ 33,556 $(88,571) $(22,121) $(72,077)
Fixed charges
Interest expense 105,164 147,821 112,723 122,130 189,604 319,719
Estimated interest component
of net rental payments - - - - - -
----------- ----------- ----------- ----------- ----------- -----------
Total fixed charges including
interest on deposits 105,164 147,821 112,723 122,130 189,604 319,719
Less: Interest on deposits 82,248 113,986 83,557 101,094 170,208 290,722
----------- ----------- ----------- ----------- ----------- -----------
Total fixed charges excluding
interest on deposits 22,916 33,835 29,166 21,036 19,396 28,997
Income before taxes and
fixed charges (including interest
on deposits) 160,630 235,969 146,279 33,559 167,483 247,642
Income before taxes and
fixed charges (excluding interest
on deposits) 78,382 121,983 62,722 (67,535) (2,725) (43,080)
Preferred stock dividends 8,063 10,750 12,124 1,434 358 -
Ratio of earnings to fixed charges
Including Interest on Deposits 1.53 1.60 1.30 n/a n/a n/a
Excluding Interest on Deposits 3.42 3.61 2.15 n/a n/a n/a
Ratio of earnings to fixed charges &
Preferred Stock Dividends
Including Interest on Deposits 1.42 1.49 1.17 n/a n/a n/a
Excluding Interest on Deposits 2.53 2.74 1.52 n/a n/a n/a
</TABLE>
* Earnings include consolidated earnings of the Corporation's national banking
subsidiaries, which may not be available (due to legal limitations on the
sources and amounts of dividends national banks are permitted to pay their
parent companies) to cover fixed charges of the Corporation. Fixed charges
include interest on long-term debt and preferred stock dividends, which are
obligations of the Corporation. During the years ended December 31, 1993, 1992
and 1991, earnings were insufficient to cover fixed charges (including interest
on deposits) and preferred stock dividend requirements by $90.0 million, $22.5
million, and $72.1 million, respectively. On a pro forma basis, assuming the
sale of the Series A Preferred Securities was consummated as of the beginning of
the respective periods, earnings would have been sufficient to cover fixed
charges (including interest on deposits) and preferred stock requirements by
$45.3 million and $74.6 million for the nine-month period ended September 30,
1996, and the twelve-month period ended December 31, 1995, respectively. The
proceeds from the sale of the Series A Preferred Securities (approximately $150
million) are assumed to be invested in short-term securities.
<PAGE>
ARTHUR
ANDERSEN
ARTHUR ANDERSEN & CO. SC
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the reference to our
firm under the caption "Independent Public Accountants" in the Registration
Statement Form S-3 and related Prospectus of Riggs National Corporation and
Riggs Capital for the registration of Junior Subordinated Deferrable Interest
Debentures and Preferred Securities and to the incorporation by reference
therein of our report dated January 17, 1996 with respect to the consolidated
financial statements of Riggs National Corporation in its Annual Report
(Form 10-K) for the year ended December 31, 1995, filed with the Securities and
Exchange Commission.
/s/ Arthur Andersen LLP
Washington, D.C.
February 6, 1997
<PAGE>
EXHIBIT 23(b)
[LETTERHEAD OF RICHARDS, LAYTON & FINGER APPEARS HERE]
February 6, 1997
Riggs National Corporation
1503 Pennsylvania Avenue, N.W.
Washington, D.C. 20005
Ladies and Gentlemen:
We hereby consent to the reference to us under the heading "Validity of
Securities" in the Prospectus included in this Registration Statement and to the
filing of our related opinion dated December 13, 1996 as an exhibit to this
Registration Statement on Form S-3 filed with the Securities and Exchange
Commission. In giving this consent, we do not hereby admit that we are within
the category of persons whose consent is required under Section 7 of the
Securities Act of 1933, as amended, or the rules and regulations of the
Securities and Exchange Commission thereunder.
Very truly yours,
/s/ Richards, Layton & Finger
EAM/jmb
<PAGE>
Exhibit 23(c)
February 6, 1997
Riggs National Corporation,
1503 Pennsylvania Avenue, N.W.,
Washington, D.C. 20005
Ladies and Gentlemen:
We hereby consent to the two references to us under the heading
"Validity of Securities" in the Prospectus included in this Registration
Statement and to the filing of both of our related opinions, each dated December
13, 1996, as exhibits to this Registration Statement on Form S-3 filed with
the Securities and Exchange Commission. In giving this consent, we do not
hereby admit that we are within the category of persons whose consent is
required under Section 7 of the Securities Act of 1933, as amended, or the
rules and regulations of the Securities and Exchange Commission thereunder.
Very truly yours,
SULLIVAN & CROMWELL
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Frederick L.
Bollerer, John L. Davis and Linda A. Madrid my true and lawful attorney-in-fact
and agents to do any and all acts and to execute any and all instruments,
agreements, documents, certificates and contracts in connection with the
proposed offering by Riggs Capital of its Series A Preferred Securities to be
issued pursuant to Rule 144A, promulgated pursuant to the Securities Act of
1933, as amended, (the "Securities Act") and if deemed so advisable to register
the Series A Preferred Securities pursuant to the Securities Act with the
Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this 13th day of
November 1996.
/s/ Timothy C. Coughlin
---------------------------
Timothy C. Coughlin
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, Frederick L. Bollerer, John L. Davis and Linda A. Madrid my true and
lawful attorney-in-fact and agents to do any and all acts and to execute any and
all instruments, agreements, documents, certificates and contracts in connection
with the proposed offering by Riggs Capital of its Series A Preferred Securities
to be issued pursuant to Rule 144A, promulgated pursuant to the Securities Act
of 1933, as amended, (the "Securities Act") and if deemed so advisable to
register the Series A Preferred Securities pursuant to the Securities Act with
the Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this day of
----
November 1996.
/s/ Calvin Cafritz
---------------------------
Calvin Cafritz
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, Frederick L. Bollerer, John L. Davis and Linda A. Madrid my true and
lawful attorney-in-fact and agents to do any and all acts and to execute any and
all instruments, agreements, documents, certificates and contracts in connection
with the proposed offering by Riggs Capital of its Series A Preferred Securities
to be issued pursuant to Rule 144A, promulgated pursuant to the Securities Act
of 1933, as amended, (the "Securities Act") and if deemed so advisable to
register the Series A Preferred Securities pursuant to the Securities Act with
the Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this 19th day of
November 1996.
/s/ Robert L. Allbritton
---------------------------
Robert L. Allbritton
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, Frederick L. Bollerer, John L. Davis and Linda A. Madrid my true and
lawful attorney-in-fact and agents to do any and all acts and to execute any and
all instruments, agreements, documents, certificates and contracts in connection
with the proposed offering by Riggs Capital of its Series A Preferred Securities
to be issued pursuant to Rule 144A, promulgated pursuant to the Securities Act
of 1933, as amended, (the "Securities Act") and if deemed so advisable to
register the Series A Preferred Securities pursuant to the Securities Act with
the Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this 16th day of
November 1996.
/s/ Barbara B. Allbritton
---------------------------
Barbara B. Allbritton
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, Frederick L. Bollerer, John L. Davis and Linda A. Madrid my true and
lawful attorney-in-fact and agents to do any and all acts and to execute any and
all instruments, agreements, documents, certificates and contracts in connection
with the proposed offering by Riggs Capital of its Series A Preferred Securities
to be issued pursuant to Rule 144A, promulgated pursuant to the Securities Act
of 1933, as amended, (the "Securities Act") and if deemed so advisable to
register the Series A Preferred Securities pursuant to the Securities Act with
the Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this 13th day of
November 1996.
/s/ Joe L. Allbritton
---------------------------
Joe L. Allbritton
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, John L. Davis and Linda A. Madrid my true and lawful attorney-in-fact
and agents to do any and all acts and to execute any and all instruments,
agreements, documents, certificates and contracts in connection with the
proposed offering by Riggs Capital of its Series A Preferred Securities to be
issued pursuant to Rule 144A, promulgated pursuant to the Securities Act of
1933, as amended, (the "Securities Act") and if deemed so advisable to register
the Series A Preferred Securities pursuant to the Securities Act with the
Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this 15th day of
November 1996.
/s/ Fred L. Bollerer
---------------------------
Fred L. Bollerer
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, Frederick L. Bollerer, John L. Davis and Linda A. Madrid my true and
lawful attorney-in-fact and agents to do any and all acts and to execute any and
all instruments, agreements, documents, certificates and contracts in connection
with the proposed offering by Riggs Capital of its Series A Preferred Securities
to be issued pursuant to Rule 144A, promulgated pursuant to the Securities Act
of 1933, as amended, (the "Securities Act") and if deemed so advisable to
register the Series A Preferred Securities pursuant to the Securities Act with
the Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this 14th day of
November 1996.
/s/ Charles A. Camalier, III
----------------------------
Charles A. Camalier, III
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, Frederick L. Bollerer, John L. Davis and Linda A. Madrid my true and
lawful attorney-in-fact and agents to do any and all acts and to execute any and
all instruments, agreements, documents, certificates and contracts in connection
with the proposed offering by Riggs Capital of its Series A Preferred Securities
to be issued pursuant to Rule 144A, promulgated pursuant to the Securities Act
of 1933, as amended, (the "Securities Act") and if deemed so advisable to
register the Series A Preferred Securities pursuant to the Securities Act with
the Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this 28th day of
November 1996.
/s/ Ronald E. Cuneo
---------------------------
Ronald E. Cuneo
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, Frederick L. Bollerer, John L. Davis and Linda A. Madrid my true and
lawful attorney-in-fact and agents to do any and all acts and to execute any and
all instruments, agreements, documents, certificates and contracts in connection
with the proposed offering by Riggs Capital of its Series A Preferred Securities
to be issued pursuant to Rule 144A, promulgated pursuant to the Securities Act
of 1933, as amended, (the "Securities Act") and if deemed so advisable to
register the Series A Preferred Securities pursuant to the Securities Act with
the Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this 14th day of
November 1996.
/s/ Floyd E. Davis, III
---------------------------
Floyd E. Davis, III
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, Frederick L. Bollerer, John L. Davis and Linda A. Madrid my true and
lawful attorney-in-fact and agents to do any and all acts and to execute any and
all instruments, agreements, documents, certificates and contracts in connection
with the proposed offering by Riggs Capital of its Series A Preferred Securities
to be issued pursuant to Rule 144A, promulgated pursuant to the Securities Act
of 1933, as amended, (the "Securities Act") and if deemed so advisable to
register the Series A Preferred Securities pursuant to the Securities Act with
the Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this 13th day of
November 1996.
/s/ Jacqueline C. Duchange
---------------------------
Jacqueline C. Duchange
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, Frederick L. Bollerer, John L. Davis and Linda A. Madrid my true and
lawful attorney-in-fact and agents to do any and all acts and to execute any and
all instruments, agreements, documents, certificates and contracts in connection
with the proposed offering by Riggs Capital of its Series A Preferred Securities
to be issued pursuant to Rule 144A, promulgated pursuant to the Securities Act
of 1933, as amended, (the "Securities Act") and if deemed so advisable to
register the Series A Preferred Securities pursuant to the Securities Act with
the Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this 22nd day of
November 1996.
/s/ Michela A. English
---------------------------
Michela A. English
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, Frederick L. Bollerer, John L. Davis and Linda A. Madrid my true and
lawful attorney-in-fact and agents to do any and all acts and to execute any and
all instruments, agreements, documents, certificates and contracts in connection
with the proposed offering by Riggs Capital of its Series A Preferred Securities
to be issued pursuant to Rule 144A, promulgated pursuant to the Securities Act
of 1933, as amended, (the "Securities Act") and if deemed so advisable to
register the Series A Preferred Securities pursuant to the Securities Act with
the Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this 14th day of
November 1996.
/s/ James E. Fitzgerald, M.D.
-----------------------------
James E. Fitzgerald, M.D.
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, Frederick L. Bollerer, John L. Davis and Linda A. Madrid my true and
lawful attorney-in-fact and agents to do any and all acts and to execute any and
all instruments, agreements, documents, certificates and contracts in connection
with the proposed offering by Riggs Capital of its Series A Preferred Securities
to be issued pursuant to Rule 144A, promulgated pursuant to the Securities Act
of 1933, as amended, (the "Securities Act") and if deemed so advisable to
register the Series A Preferred Securities pursuant to the Securities Act with
the Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this 10th day of
December 1996.
/s/ Heather S. Foley
---------------------------
Heather S. Foley
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, Frederick L. Bollerer, John L. Davis and Linda A. Madrid my true and
lawful attorney-in-fact and agents to do any and all acts and to execute any and
all instruments, agreements, documents, certificates and contracts in connection
with the proposed offering by Riggs Capital of its Series A Preferred Securities
to be issued pursuant to Rule 144A, promulgated pursuant to the Securities Act
of 1933, as amended, (the "Securities Act") and if deemed so advisable to
register the Series A Preferred Securities pursuant to the Securities Act with
the Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this day of
----
November 1996.
/s/ David J. Gladstone
---------------------------
David J. Gladstone
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, Frederick L. Bollerer, John L. Davis and Linda A. Madrid my true and
lawful attorney-in-fact and agents to do any and all acts and to execute any and
all instruments, agreements, documents, certificates and contracts in connection
with the proposed offering by Riggs Capital of its Series A Preferred Securities
to be issued pursuant to Rule 144A, promulgated pursuant to the Securities Act
of 1933, as amended, (the "Securities Act") and if deemed so advisable to
register the Series A Preferred Securities pursuant to the Securities Act with
the Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this 15th day of
November 1996.
/s/ Lawrence I. Hebert
---------------------------
Lawrence I. Hebert
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, Frederick L. Bollerer, John L. Davis and Linda A. Madrid my true and
lawful attorney-in-fact and agents to do any and all acts and to execute any and
all instruments, agreements, documents, certificates and contracts in connection
with the proposed offering by Riggs Capital of its Series A Preferred Securities
to be issued pursuant to Rule 144A, promulgated pursuant to the Securities Act
of 1933, as amended, (the "Securities Act") and if deemed so advisable to
register the Series A Preferred Securities pursuant to the Securities Act with
the Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this 21st day of
November 1996.
/s/ Michael J. Jackson
---------------------------
Michael J. Jackson
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, Frederick L. Bollerer, John L. Davis and Linda A. Madrid my true and
lawful attorney-in-fact and agents to do any and all acts and to execute any and
all instruments, agreements, documents, certificates and contracts in connection
with the proposed offering by Riggs Capital of its Series A Preferred Securities
to be issued pursuant to Rule 144A, promulgated pursuant to the Securities Act
of 1933, as amended, (the "Securities Act") and if deemed so advisable to
register the Series A Preferred Securities pursuant to the Securities Act with
the Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this 17th day of
November 1996.
/s/ Timothy A. Lex
---------------------------
Timothy A. Lex
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, Frederick L. Bollerer, John L. Davis and Linda A. Madrid my true and
lawful attorney-in-fact and agents to do any and all acts and to execute any and
all instruments, agreements, documents, certificates and contracts in connection
with the proposed offering by Riggs Capital of its Series A Preferred Securities
to be issued pursuant to Rule 144A, promulgated pursuant to the Securities Act
of 1933, as amended, (the "Securities Act") and if deemed so advisable to
register the Series A Preferred Securities pursuant to the Securities Act with
the Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this 13th day of
December 1996.
/s/ Leo J. O'Donovan, S.J.
---------------------------
Leo J. O'Donovan, S.J.
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, Frederick L. Bollerer, John L. Davis and Linda A. Madrid my true and
lawful attorney-in-fact and agents to do any and all acts and to execute any and
all instruments, agreements, documents, certificates and contracts in connection
with the proposed offering by Riggs Capital of its Series A Preferred Securities
to be issued pursuant to Rule 144A, promulgated pursuant to the Securities Act
of 1933, as amended, (the "Securities Act") and if deemed so advisable to
register the Series A Preferred Securities pursuant to the Securities Act with
the Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this 14th day of
November 1996.
/s/ John A. Sargent
---------------------------
John A. Sargent
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, Frederick L. Bollerer, John L. Davis and Linda A. Madrid my true and
lawful attorney-in-fact and agents to do any and all acts and to execute any and
all instruments, agreements, documents, certificates and contracts in connection
with the proposed offering by Riggs Capital of its Series A Preferred Securities
to be issued pursuant to Rule 144A, promulgated pursuant to the Securities Act
of 1933, as amended, (the "Securities Act") and if deemed so advisable to
register the Series A Preferred Securities pursuant to the Securities Act with
the Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this 13th day of
November 1996.
/s/ Robert L. Sloan
---------------------------
Robert L. Sloan
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, Frederick L. Bollerer, John L. Davis and Linda A. Madrid my true and
lawful attorney-in-fact and agents to do any and all acts and to execute any and
all instruments, agreements, documents, certificates and contracts in connection
with the proposed offering by Riggs Capital of its Series A Preferred Securities
to be issued pursuant to Rule 144A, promulgated pursuant to the Securities Act
of 1933, as amended, (the "Securities Act") and if deemed so advisable to
register the Series A Preferred Securities pursuant to the Securities Act with
the Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this 14th day of
November 1996.
/s/ Steven B. Pfeiffer
---------------------------
Steven B. Pfeiffer
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, Frederick L. Bollerer, John L. Davis and Linda A. Madrid my true and
lawful attorney-in-fact and agents to do any and all acts and to execute any and
all instruments, agreements, documents, certificates and contracts in connection
with the proposed offering by Riggs Capital of its Series A Preferred Securities
to be issued pursuant to Rule 144A, promulgated pursuant to the Securities Act
of 1933, as amended, (the "Securities Act") and if deemed so advisable to
register the Series A Preferred Securities pursuant to the Securities Act with
the Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this 14th day of
November 1996.
/s/ James W. Symington
---------------------------
James W. Symington
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, Frederick L. Bollerer, John L. Davis and Linda A. Madrid my true and
lawful attorney-in-fact and agents to do any and all acts and to execute any and
all instruments, agreements, documents, certificates and contracts in connection
with the proposed offering by Riggs Capital of its Series A Preferred Securities
to be issued pursuant to Rule 144A, promulgated pursuant to the Securities Act
of 1933, as amended, (the "Securities Act") and if deemed so advisable to
register the Series A Preferred Securities pursuant to the Securities Act with
the Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this 14th day of
November 1996.
/s/ Jack Valenti
---------------------------
Jack Valenti
<PAGE>
RIGGS NATIONAL CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that I, the undersigned, as a director
and/or officer of Riggs National Corporation, a Delaware corporation (the
"Corporation"), do hereby nominate, constitute and appoint each of Timothy C.
Coughlin, Frederick L. Bollerer, John L. Davis and Linda A. Madrid my true and
lawful attorney-in-fact and agents to do any and all acts and to execute any and
all instruments, agreements, documents, certificates and contracts in connection
with the proposed offering by Riggs Capital of its Series A Preferred Securities
to be issued pursuant to Rule 144A, promulgated pursuant to the Securities Act
of 1933, as amended, (the "Securities Act") and if deemed so advisable to
register the Series A Preferred Securities pursuant to the Securities Act with
the Securities and Exchange Commission, including specifically, but without
limitation thereof, full power and authority to sign my name as a director
and/or officer of the Corporation to all such contracts, consents and documents
in connection therewith as said attorneys-in-fact and agents may deem advisable
or necessary in their sole discretion.
IN WITNESS WHEREOF, I have hereunto set my hand this day of
----
November 1996.
/s/ Eddie N. Williams
---------------------------
Eddie N. Williams
