<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 29, 1997
REGISTRATION NO. 333-27229
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- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
AMENDMENT NO. 1 TO
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
----------------
BANKBOSTON CAPITAL TRUST III
BANKBOSTON CORPORATION
(EXACT NAME OF REGISTRANT AS
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS TRUST AGREEMENT)
SPECIFIED IN ITS CHARTER)
DELAWARE
MASSACHUSETTS
(STATE OR OTHER JURISDICTION OF
(STATE OR OTHER JURISDICTION OF INCORPORATION OR ORGANIZATION)
INCORPORATION OR ORGANIZATION)
------------
------------
6719
6712
(PRIMARY STANDARD INDUSTRIAL
(PRIMARY STANDARD INDUSTRIAL CLASSIFICATION CODE NUMBER)
CLASSIFICATION CODE NUMBER)
APPLIED FOR
04-2471221
(I.R.S. EMPLOYER IDENTIFICATION NO.)
(I.R.S. EMPLOYER IDENTIFICATION NO.)
----------------
100 FEDERAL STREET
BOSTON, MASSACHUSETTS 02110
(617) 434-2200
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANTS' PRINCIPAL EXECUTIVE OFFICES)
----------------
GARY A. SPIESS, ESQ. JANICE B. LIVA, ESQ.
GENERAL COUNSEL AND CLERK ASSISTANT GENERAL COUNSEL AND
BANKBOSTON CORPORATION ASSISTANT CLERK
100 FEDERAL STREET BANKBOSTON CORPORATION
BOSTON, MASSACHUSETTS 02110 100 FEDERAL STREET
(617) 434-2870 BOSTON, MASSACHUSETTS 02110
(617) 434-8630
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENTS FOR SERVICE)
----------------
COPIES TO:
EDWARD F. PETROSKY, ESQ. GREGORY A. FERNICOLA, ESQ.
SKADDEN, ARPS, SLATE, MEAGHER & FLOM
BROWN & WOOD LLP LLP
ONE WORLD TRADE CENTER
NEW YORK, NEW YORK 10048 919 THIRD AVENUE
---------------- NEW YORK, NEW YORK 10022
Approximate Date of Commencement of Proposed Sale to the Public:
As soon as practicable after this Registration Statement becomes effective.
If any of the securities being registered on this Form are to be offered in
connection with the formation of a holding company and there is compliance
with General Instruction G, 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 ("Securities Act"), check the following box. [_]
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
under the Securities Act, 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.
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<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. THE PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR +
+THE SOLICITATION OF ANY 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. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
PROSPECTUS Subject to Completion
Preliminary Prospectus, Dated May , 1997
$250,000,000
BankBoston Capital Trust III
FLOATING RATE CAPITAL SECURITIES
(Liquidation Amount $1,000 per Capital Security)
fully and unconditionally guaranteed, as described herein, by
BankBoston Corporation
LOGO
----------
The Floating Rate Capital Securities (the "Capital Securities") offered
hereby will represent beneficial interests in BankBoston Capital Trust III, a
statutory business trust formed under the laws of the State of Delaware (the
"Trust"). BankBoston Corporation, a Massachusetts corporation (the
"Corporation"), will be the owner of all of the beneficial interests
represented by common securities of the Trust (the "Common Securities", and
together with the Capital Securities, the "Trust Securities"). The Bank of New
York is the Property Trustee of the Trust. The Trust exists for the sole
purpose of issuing the Trust Securities and investing the proceeds thereof in
the Floating Rate Junior Subordinated Deferrable Interest Debentures (the
"Junior Subordinated Debentures") of the Corporation, which are scheduled to
mature on , 2027 (the "Stated Maturity Date"). The Capital Securities will
have a preference over the Common Securities under certain circumstances with
respect to cash distributions and amounts payable on liquidation, redemption or
otherwise. See "Description of Capital Securities--Subordination of Common
Securities."
The Capital Securities will be represented by global Capital Securities in
fully registered form, deposited with a custodian for and registered in the
name of a nominee of The Depository Trust Company ("DTC"). Beneficial interests
in such global Capital Securities will be shown on, and transfers thereof will
be effected through, records maintained by DTC and its participants. Beneficial
interests in such Capital Securities will trade in DTC's Same-Day Funds
Settlement System and secondary market trading activity in such interests will
therefore settle in immediately available funds. See "Description of Capital
Securities--Form, Denomination, Book-Entry Procedures and Transfer."
(Continued on next page)
----------
SEE "RISK FACTORS" BEGINNING ON PAGE 9 FOR A DISCUSSION OF CERTAIN FACTORS
THAT SHOULD BE CONSIDERED BY PROSPECTIVE INVESTORS IN EVALUATING AN INVESTMENT
IN THE CAPITAL SECURITIES.
----------
THE SECURITIES OFFERED HEREBY ARE NOT DEPOSITS OR OTHER OBLIGATIONS OF
A BANK 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.
<TABLE>
<CAPTION>
PRICE TO UNDERWRITING PROCEEDS TO
PUBLIC(1) COMMISSION(2) TRUST(3)(4)
--------- ------------- -----------
<S> <C> <C> <C>
Per Capital Security............. $ (4) $
Total..................................... $ (4) $
</TABLE>
- -----
(1) Plus accumulated Distributions, if any, from , 1997
(2) The Corporation and the Trust have agreed to indemnify the several
Underwriters against certain liabilities, including liabilities under the
Securities Act of 1933, as amended. See "Underwriting."
(3) Before deducting estimated expenses of $ payable by the Corporation.
(4) In view of the fact that the proceeds of the sale of the Capital Securities
will be invested in the Junior Subordinated Debentures, the Corporation has
agreed to pay to the Underwriters, as compensation, $ per Capital
Security (or $ in the aggregate). See "Underwriting."
----------
The Capital Securities are offered by the several Underwriters, subject to
prior sale, when, as and if issued to and accepted by the Underwriters and
subject to approval of certain legal matters by counsel for the Underwriters
and to certain other conditions. The Underwriters reserve the right to
withdraw, cancel or modify such offer and to reject orders in whole or in part.
It is expected that delivery of the Capital Securities will be made through the
facilities of DTC, on or about , 1997, against payment therefor in
immediately available funds.
----------
Morgan Stanley & Co. Incorporated
CS First Boston Corporation
Lehman Brothers
Salomon Brothers Inc
----------
The date of this Prospectus is May , 1997.
<PAGE>
CERTAIN PERSONS PARTICIPATING IN THE OFFERING OF THE CAPITAL SECURITIES MAY
ENGAGE IN TRANSACTIONS THAT STABILIZE, MAINTAIN, OR OTHERWISE AFFECT THE PRICE
OF THE CAPITAL SECURITIES. SUCH TRANSACTIONS MAY INCLUDE STABILIZING, THE
PURCHASE OF THE CAPITAL SECURITIES TO COVER SYNDICATE SHORT POSITIONS AND THE
IMPOSITION OF PENALTY BIDS. FOR A DESCRIPTION OF THESE ACTIVITIES, SEE
"UNDERWRITING."
----------------
(Continued from the previous page)
Holders of the Trust Securities will be entitled to receive cumulative cash
distributions arising from the payment of interest on the Junior Subordinated
Debentures, accumulating from the date of original issuance and payable
quarterly in arrears on , , and of each year, commencing ,
1997, at a rate per annum reset quarterly equal to LIBOR (as defined herein)
plus % (the "Distribution Rate") on the Liquidation Amount of $1,000 per
Trust Security ("Distributions"). The Corporation will have the right to defer
payments of interest on the Junior Subordinated Debentures at any time and
from time to time for a period not exceeding 20 consecutive quarterly periods
with respect to each deferral period (each, an "Extension Period"), provided
that no Extension Period may extend beyond the Stated Maturity Date. Upon
termination of any such Extension Period and the payment of all amounts then
due, the Corporation may elect to begin a new Extension Period, subject to the
requirements set forth herein. If and for so long as interest payments on the
Junior Subordinated Debentures are so deferred, Distributions on the Trust
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 Corporation's capital stock (which includes
common and preferred stock) or to make any payment with respect to debt
securities of the Corporation that rank pari passu with or junior to the
Junior Subordinated Debentures. During an Extension Period, interest on the
Junior Subordinated Debentures will continue to accrue (and the amount of
Distributions to which holders of the Trust Securities are entitled will
continue to accumulate) at the applicable periodic Distribution Rate,
compounded quarterly from the relevant payment date for such interest, and
holders of Trust Securities will be required to accrue interest income for
United States federal income tax purposes. See "Description of Junior
Subordinated Debentures--Option to Extend Interest Payment Date" and "Certain
Federal Income Tax Consequences--Interest Income and Original Issue Discount."
The Corporation will, through the Guarantee, the Common Guarantee, the Trust
Agreement, the Junior Subordinated Debentures and the Indenture (each as
defined herein), taken together, fully, irrevocably and unconditionally
guarantee all of the Trust's obligations under the Trust Securities. See
"Relationship Among the Capital Securities, the Junior Subordinated Debentures
and the Guarantee--Full and Unconditional Guarantee." The Guarantee and the
Common Guarantee will guarantee payments of Distributions and payments on
liquidation of the Trust or redemption of the Trust Securities, but in each
case only to the extent that the Trust holds funds on hand legally available
therefor and has failed to make such payments, as described herein. See
"Description of Guarantee." If the Corporation fails to make a required
payment on the Junior Subordinated Debentures, the Trust will not have
sufficient funds to make the related payments, including Distributions, on the
Trust Securities. The Guarantee and the Common Guarantee will not cover any
such payment when the Trust does not have sufficient funds on hand legally
available therefor. In such event, a holder of Capital Securities may
institute a legal proceeding directly against the Corporation to enforce its
rights in respect of such payment. See "Description of Junior Subordinated
Debentures--Enforcement of Certain Rights by Holders of Capital Securities."
The obligations of the Corporation under the Guarantee, the Common Guarantee
and the Junior Subordinated Debentures will rank subordinate and junior in
right of payment to all Senior Indebtedness (as defined in "Description of
Junior Subordinated Debentures--Subordination").
The Trust Securities will be subject to mandatory redemption in a Like
Amount (as defined herein), (i) in whole but not in part, on the Stated
Maturity Date upon repayment of the Junior Subordinated Debentures at a
redemption price equal to the principal amount of, plus accrued interest on,
the Junior Subordinated Debentures (the "Maturity Redemption Price"), (ii) in
whole but not in part, at any time, contemporaneously with the
2
<PAGE>
(Continued from the previous page)
optional prepayment of the Junior Subordinated Debentures, upon the occurrence
and continuation of a Special Event (as defined herein) at a redemption price
(the "Early Redemption Price") equal to the Prepayment Price (as defined
below), and (iii) in whole or in part, on or after , 2007,
contemporaneously with the optional prepayment by the Corporation of the
Junior Subordinated Debentures, at the Early Redemption Price. Any of the
Maturity Redemption Price and the Early Redemption Price may be referred to
herein as the "Redemption Price." See "Description of Capital Securities--
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 of the
Federal Reserve, the Junior Subordinated Debentures will be prepayable prior
to the Stated Maturity Date at the option of the Corporation (i) on or after
, 2007, in whole or in part, or (ii) at any time, in whole but not in part,
upon the occurrence and continuation of a Special Event, in each case at a
prepayment price (the "Prepayment Price") equal to 100% of the principal
amount of the Junior Subordinated Debentures so redeemed plus accrued interest
thereon to the date of prepayment. See "Description of Junior Subordinated
Debentures--Optional Prepayment" and "--Special Event Prepayment."
The Corporation will have the right at any time to terminate the Trust and
cause a Like Amount of the Junior Subordinated Debentures to be distributed to
the holders of the Trust Securities in liquidation of the Trust, subject to
(i) the Corporation having received an opinion of counsel to the effect that
such distribution will not be a taxable event to holders of the Capital
Securities and (ii) the prior approval of the Federal Reserve to do so if then
required under applicable capital guidelines or policies of the Federal
Reserve. Unless the Junior Subordinated Debentures are distributed to the
holders of the Trust Securities, in the event of a liquidation of the Trust as
described herein, after satisfaction of liabilities to creditors of the Trust
as required by applicable law, the holders of the Capital Securities generally
will be entitled to receive a Liquidation Amount of $1,000 per Capital
Security plus accumulated Distributions thereon to the date of payment. See
"Description of Capital Securities--Liquidation of the Trust and Distribution
of Junior Subordinated Debentures."
----------------
As used herein, (i) the "Indenture" means the Indenture, to be dated as of
, 1997, as amended and supplemented from time to time, between the
Corporation and The Bank of New York, as trustee (the "Debenture Trustee"),
relating to the Junior Subordinated Debentures, (ii) the "Trust Agreement"
means the Amended and Restated Declaration of Trust relating to the Trust
among the Corporation, as Sponsor, 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 "Issuer
Trustees"), (iii) the "Guarantee" means the Capital Securities Guarantee
Agreement between the Corporation and The Bank of New York, as trustee (the
"Guarantee Trustee") and (iv) the "Common Guarantee" means the Common
Securities Guarantee Agreement of the Corporation.
3
<PAGE>
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 may be inspected and copied at the
public reference facilities maintained by the Commission at Room 1024, 450
Fifth Street, N.W., Washington, D.C. 20549 and at the Commission's regional
offices at 7 World Trade Center, 13th Floor, Suite 1300, New York, New York
10048 and Suite 1400, Citicorp Center, 500 West Madison Street, Chicago,
Illinois 60661. Copies of such material may also be obtained by mail from the
Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 at prescribed rates. Such information may also be
accessed electronically by means of the Commission's home page on the Internet
(http://www.sec.gov.). In addition, such reports, proxy statements and other
information concerning the Corporation may be inspected at the offices of the
New York Stock Exchange, Inc., 20 Broad Street, New York, New York 10005 and
the Boston Stock Exchange Incorporated, One Boston Place, Boston,
Massachusetts 02108, on which exchanges certain securities of the Corporation
are listed.
No separate financial statements of the Trust have been included herein. The
Corporation and the Trust do not consider that such financial statements would
be material to holders of the Capital Securities because the Trust 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 Junior Subordinated
Debentures, issuing the Trust Securities and engaging in necessary, advisable
or incidental activities. See "BankBoston Capital Trust III", "Description of
Capital Securities", "Description of Junior Subordinated Debentures" and
"Description of Guarantee". In addition, the Corporation does not expect that
the Trust will file reports, proxy statements and other information under the
Exchange Act with the Commission.
This Prospectus constitutes a part of a registration statement on Form S-3
(the "Registration Statement") filed by the Corporation and the Trust with the
Commission under the Securities Act of 1933, as amended (the "Securities
Act"). This Prospectus does not contain all the information set forth in the
Registration Statement, certain parts of which are omitted in accordance with
the rules and regulations of the Commission, and reference is hereby made to
the Registration Statement and to the exhibits relating thereto for further
information with respect to the Corporation, the Trust and the Trust
Securities. Any statements contained herein concerning the provisions of any
document are not necessarily complete, and, in each instance, reference is
made to the copy of such document filed as an exhibit to the Registration
Statement or otherwise filed with the Commission. Each such statement is
qualified in its entirety by such reference.
4
<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 year ended
December 31, 1996;
2. The Corporation's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1997; and
3. The Corporation's Current Reports on Form 8-K dated January 16, 1997
and April 17, 1997.
All documents subsequently filed by the Corporation pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date hereof and prior
to the termination of the offering of the Capital Securities offered hereby
shall be deemed to be incorporated by reference into this Prospectus and to be
a part of this Prospectus from the date of filing of such document. Any
statement contained herein or in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained
herein or in any other subsequently filed document which also is or is deemed
to be incorporated by reference herein modifies or supersedes such statement.
Any statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus.
As used herein, the terms "Prospectus" and "herein" mean this Prospectus,
including the documents incorporated or deemed to be incorporated herein by
reference, as the same may be amended, supplemented or otherwise modified from
time to time. Statements contained in this Prospectus as to the contents of
any contract or other document referred to herein do not purport to be
complete, and where reference is made to the particular provisions of such
contract or other document, such provisions are qualified in all respects by
reference to all of the provisions of such contract or other document. 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 texts of such
documents). Requests for such documents should be directed to: Investor
Relations, BankBoston, P.O. Box 2016, MA BOS 01-20-02, Boston, Massachusetts
02106-2016. Telephone requests may be directed to Investor Relations at (617)
434-7858.
5
<PAGE>
PROSPECTUS SUMMARY
The following summary is qualified in its entirety by the more detailed
information appearing elsewhere in this Prospectus or incorporated herein by
reference.
BANKBOSTON CORPORATION
The Corporation is a registered bank holding company organized in 1970 under
Massachusetts law with both national and international operations. The
Corporation, through its subsidiaries and, in certain cases, joint ventures, is
engaged in providing a wide variety of personal, corporate and global banking
services to individuals, corporate and institutional customers, governments and
other financial institutions. The Corporation, together with its subsidiaries,
operates a network of 650 offices across the United States and more than 100
offices in 24 countries in Latin America, Europe, Asia and Africa. The major
banking subsidiaries of the Corporation include BankBoston, N.A., Bank of
Boston Connecticut and Rhode Island Hospital Trust National Bank.
BANKBOSTON CAPITAL TRUST III
The Trust is a statutory business trust formed under Delaware law pursuant to
(i) the Trust Agreement executed by the Corporation, as Sponsor, The Bank of
New York, as Property Trustee, and The Bank of New York (Delaware), as Delaware
Trustee and the three individual Administrative Trustees named therein, and
(ii) the filing of a certificate of trust with the Delaware Secretary of State
on May 14, 1997. The Trust's business and affairs are conducted by the Issuer
Trustees: the Property Trustee, the Delaware Trustee, and the three individual
Administrative Trustees who are employees or officers of or affiliated with the
Corporation. The Trust exists for the exclusive purposes of (i) issuing and
selling the Trust Securities, (ii) using the proceeds from the sale of the
Trust Securities to acquire the Junior Subordinated Debentures issued by the
Corporation and (iii) engaging in only those other activities necessary,
advisable or incidental thereto. Accordingly, the Junior Subordinated
Debentures will be the sole assets of the Trust, and payments under the Junior
Subordinated Debentures will be the sole revenues of the Trust. All of the
Common Securities will be owned by the Corporation.
THE OFFERING
Securities Offered............ 250,000 Floating Rate Capital Securities
(Liquidation Amount $1,000 per Capital
Security).
Offering Price................ $ per Capital Security plus accumulated
Distributions, if any, from , 1997.
Distribution Dates............ , , and of each year,
commencing , 1997.
Extension Periods............. Distributions on Capital Securities will be
deferred for the duration of any Extension
Period elected by the Corporation with respect
to the payment of interest on the Junior
Subordinated Debentures. No Extension Period
will exceed 20 consecutive quarterly periods or
extend beyond the Stated Maturity Date. See
"Description of Junior Subordinated
Debentures--Option to Extend Interest Payment
Date" and "Certain Federal Income Tax
Consequences--Interest Income and Original
Issue Discount."
6
<PAGE>
Ranking.......................
The Capital Securities will rank pari passu,
and payments thereon will be made pro rata,
with the Common Securities except as described
under "Description of Capital Securities--
Subordination of Common Securities." The Junior
Subordinated Debentures will rank pari passu
with the $257,732,000 aggregate principal
amount of 8.25% Junior Subordinated Deferrable
Interest Debentures due December 15, 2026, the
$257,732,000 aggregate principal amount of 7
3/4% Junior Subordinated Deferrable Interest
Debentures due December 15, 2026 and all other
junior subordinated debentures to be issued by
the Corporation (collectively, "Other
Debentures"), which will be issued and sold to
other trusts to be established by the
Corporation, in each case similar to the Trust
("Other Trusts"), and will be unsecured and
will rank subordinate and junior in right of
payment to all Senior Indebtedness to the
extent and in the manner set forth in the
Indenture. See "Description of Junior
Subordinated Debentures." The Guarantee will
rank pari passu with the guarantees issued by
the Corporation with respect to the 250,000
8.25% Capital Securities (Liquidation Amount
$1,000 per security) of BankBoston Capital
Trust I, the 250,000 7 3/4% Capital Securities
(Liquidation Amount $1,000 per security) of
BankBoston Capital Trust II and all other
guarantees to be issued by the Corporation with
respect to capital securities issued or to be
issued by Other Trusts (collectively, "Other
Guarantees") and will constitute an unsecured
obligation of the Corporation and will rank
subordinate and junior in right of payment to
all Senior Indebtedness to the extent and in
the manner set forth in the Guarantee
Agreement. See "Description of Guarantee."
Redemption.................... The Trust Securities will be subject to
mandatory redemption in a Like Amount, (i) in
whole but not in part, on the Stated Maturity
Date upon repayment of the Junior Subordinated
Debentures, (ii) in whole but not in part, at
any time contemporaneously with the optional
prepayment of the Junior Subordinated
Debentures by the Corporation upon the
occurrence and continuation of a Special Event
and (iii) in whole or in part, on or after
, 2007 contemporaneously with the optional
prepayment by the Corporation of the Junior
Subordinated Debentures, in each case at the
applicable Redemption Price. See "Description
of Capital Securities--Redemption."
Ratings....................... The Capital Securities are expected to be rated
"baa1" by Moody's Investors Service, Inc. and
"BBB" by Standard & Poor's Ratings Services.
Absence of Market for the
Capital Securities........... The Capital Securities will be a new issue of
securities for which there currently is no
market. Although the Underwriters have informed
the Trust and the Corporation that they each
currently
7
<PAGE>
intend to make a market in the Capital
Securities, the Underwriters are not obligated
to do so, and any such market making may be
discontinued at any time without notice.
Accordingly, there can be no assurance as to
the development or liquidity of any market for
the Capital Securities. The Trust and the
Corporation do not intend to apply for listing
of the Capital Securities on any securities
exchange or for quotation through the NASD
Automated Quotation System. See "Underwriting."
Form of Capital Securities.... The Capital Securities will be represented by a
global certificate or certificates registered
in the name of Cede & Co., as nominee for DTC.
Beneficial interests in the Capital Securities
will be evidenced by, and transfers thereof
will be effected only through, records
maintained by the participants in DTC. Except
as described herein, Capital Securities in
certificated form will not be issued in
exchange for the global certificate or
certificates. See "Description of Capital
Securities--Form, Denomination, Book-Entry
Procedures and Transfer."
Use of Proceeds............... The proceeds to the Trust from the sale of the
Capital Securities will be invested by the
Trust in the Junior Subordinated Debentures.
The Corporation intends to use the net proceeds
from the sale of the Junior Subordinated
Debentures for general corporate purposes. The
Capital Securities will be eligible to qualify
as Tier 1 capital under the capital guidelines
of the Federal Reserve. See "Use of Proceeds."
8
<PAGE>
RISK FACTORS
Prospective purchasers of the Capital Securities should carefully review the
information contained elsewhere in this Prospectus and should particularly
consider the following matters.
RANKING OF SUBORDINATED OBLIGATIONS UNDER THE GUARANTEE AND THE JUNIOR
SUBORDINATED DEBENTURES
The obligations of the Corporation under the Guarantee issued by it for the
benefit of the holders of Capital Securities, as well as under the Junior
Subordinated Debentures, will be unsecured and rank subordinate and junior in
right of payment to all Senior Indebtedness. In addition, in the case of a
bankruptcy or insolvency proceeding, the Corporation's obligations under the
Guarantee will also rank subordinate and junior in right of payment to all
liabilities (other than Other Guarantees) of the Corporation. At March 31,
1997, the aggregate principal amount of outstanding Senior Indebtedness was
approximately $275 million. Because the Corporation is a bank 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 (and thus the ability of holders of the Capital 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. At March 31, 1997, the
subsidiaries of the Corporation had total liabilities (excluding liabilities
owed to the Corporation) of approximately $59.9 billion. Accordingly, the
Junior Subordinated Debentures will be effectively subordinated to all
existing and future liabilities of the Corporation's subsidiaries, and holders
of Junior Subordinated Debentures should look only to the assets of the
Corporation for payments on the Junior Subordinated Debentures. None of the
Indenture, the Guarantee or the Trust Agreement places any limitation on the
amount of secured or unsecured debt, including Senior Indebtedness, that may
be incurred by the Corporation or its subsidiaries. See "Description of
Guarantee--Status of the Guarantee" and "Description of Junior Subordinated
Debentures--Subordination."
The ability of the Trust to pay amounts due on the Capital Securities is
solely dependent upon the Corporation making payments on the Junior
Subordinated Debentures as and when required.
OPTION TO EXTEND INTEREST PAYMENT PERIOD; TAX CONSIDERATIONS
So long as no Debenture Event of Default (as defined herein) shall have
occurred and be continuing, the Corporation will have the right under the
Indenture to defer payments of interest on the Junior Subordinated Debentures
at any time or from time to time for a period not exceeding 20 consecutive
quarterly periods with respect to each Extension Period, provided that no
Extension Period may extend beyond the Stated Maturity Date. As a consequence
of any such deferral, quarterly Distributions on the Capital Securities by the
Trust will be deferred (and the amount of Distributions to which holders of
the Capital Securities are entitled will accumulate additional Distributions
thereon at the applicable Interest Rate (as defined herein), compounded
quarterly, but not exceeding the interest rate then accruing on the Junior
Subordinated Debentures) from the relevant payment date for such Distributions
during any such Extension Period.
Prior to the termination of any Extension Period, the Corporation may
further extend such Extension Period, provided that such extension does not
cause such Extension Period to exceed 20 consecutive quarterly periods or to
extend beyond the Stated Maturity Date. Upon the termination of any Extension
Period and the payment of all interest then accrued and unpaid on the Junior
Subordinated Debentures (together with interest thereon at the applicable
Interest Rate, compounded quarterly, 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
Capital Securities--Distributions" and "Description of Junior Subordinated
Debentures--Option to Extend Interest Payment Date."
Should the Corporation exercise its right to defer payments of interest on
the Junior Subordinated Debentures, each holder of Trust Securities will be
required to accrue income (as original issue discount ("OID")) in respect of
the deferred stated interest allocable to its Trust Securities for United
States federal
9
<PAGE>
income tax purposes, which will be allocated but not distributed to holders of
Trust Securities. As a result, each such holder of Capital Securities will
recognize 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 Trust if the holder disposes of the Capital Securities prior to the record
date for the payment of Distributions thereafter. See "Certain Federal Income
Tax Consequences--Interest Income and Original Issue Discount" and "--Sales of
Capital Securities."
Should the Corporation elect to exercise its right to defer payments of
interest on the Junior Subordinated Debentures in the future, the market price
of the Capital Securities is likely to be affected. A holder that disposes of
its Capital Securities during an Extension Period, therefore, might not
receive the same return on its investment as a holder that continues to hold
its Capital Securities. In addition, merely as a result of the existence of
the Corporation's right to defer payments of interest on the Junior
Subordinated Debentures, the market price of the Capital Securities may be
more volatile than the market prices of other securities on which OID accrues
and that are not subject to such deferrals.
SPECIAL EVENT REDEMPTION
Upon the occurrence and continuation of a Special Event (as defined under
"Description of Junior Subordinated Debentures--Special Event Prepayment"),
the Corporation will have the right to prepay the Junior Subordinated
Debentures in whole (but not in part) at the Prepayment Price within 90 days
following the occurrence of such Special Event and therefore cause a mandatory
redemption of the Trust Securities at the Early Redemption Price. 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 of the Federal Reserve. See "Description of Capital Securities--
Redemption."
PROPOSED TAX LEGISLATION
On February 6, 1997, as part of the Clinton Administration's Fiscal 1998
Budget Proposal, the Treasury Department proposed legislation (the "Proposed
Legislation") which would, among other things, generally deny corporate
issuers a deduction for interest in respect of certain debt obligations, such
as the Junior Subordinated Debentures, issued on or after the date of "first
committee action," if such debt obligations have a maximum term in excess of
15 years and are not shown as indebtedness on the issuer's applicable
consolidated balance sheet. Since the Proposed Legislation has not yet been
introduced by any member of the 105th Congress, the Proposed Legislation
should not apply to the Junior Subordinated Debentures. It is possible,
however, that the Proposed Legislation or any other legislation enacted by
Congress may give rise to a Tax Event, in which event the Corporation would be
permitted, 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 Trust Securities at the Early Redemption Price by electing
to prepay the Junior Subordinated Debentures at the Prepayment Price. See
"Description of Capital Securities--Redemption" and "Description of Junior
Subordinated Debentures--Special Event Prepayment." See also "Certain Federal
Income Tax Consequences--Proposed Tax Legislation."
POSSIBLE ADVERSE EFFECT ON MARKET PRICES
There can be no assurance as to the market prices for Capital Securities or
Junior Subordinated Debentures distributed to the holders of Capital
Securities if a termination of the Trust were to occur. Accordingly, the
Capital Securities or the Junior Subordinated Debentures may trade at a
discount from the price that the investor paid to purchase the Capital
Securities offered hereby. Because holders of Capital Securities may receive
Junior Subordinated Debentures in liquidation of the Trust and because
Distributions are otherwise limited to payments on the Junior Subordinated
Debentures, prospective purchasers of Capital Securities are also making an
investment decision with regard to the Junior Subordinated Debentures and
should carefully review all the information regarding the Junior Subordinated
Debentures contained herein. See "Description of Junior Subordinated
Debentures."
10
<PAGE>
RIGHTS UNDER THE GUARANTEE
The Guarantee is qualified as an indenture under the Trust Indenture Act of
1939, as amended (the "Trust Indenture Act"). The Bank of New York will act as
Guarantee Trustee for the purpose of compliance with the Trust Indenture Act
and will hold the Guarantee for the benefit of the holders of the Capital
Securities. The Bank of New York will also act as Property Trustee and as
Debenture Trustee under the Indenture. The Bank of New York (Delaware) will
act as Delaware Trustee under the Trust Agreement. The Guarantee will
guarantee to the holders of the Capital Securities the following payments, to
the extent not paid by the Trust: (i) any accumulated and unpaid Distributions
required to be paid on the Capital Securities, to the extent that the Trust
has funds on hand legally available therefor at such time, (ii) the applicable
Redemption Price with respect to any Capital Securities called for redemption,
to the extent that the Trust has funds on hand legally available therefor at
such time, and (iii) upon a voluntary or involuntary termination and
liquidation of the Trust (unless the Junior Subordinated Debentures are
distributed to holders of the Capital Securities), 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 Trust has funds
on hand legally available therefor at such time and (b) the amount of assets
of the Trust remaining available for distribution to holders of the Capital
Securities upon a termination and liquidation of the Trust. The holders of a
majority in Liquidation Amount of the Capital Securities will 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 Guarantee or to
direct the exercise of any trust power conferred upon the Guarantee Trustee.
Any holder of the Capital Securities may institute a legal proceeding directly
against the Corporation to enforce its rights under the Guarantee without
first instituting a legal proceeding against the Trust, the Guarantee Trustee
or any other person or entity. If the Corporation defaults on its obligation
to pay amounts payable under the Junior Subordinated Debentures, the Trust
will not have sufficient funds for the payment of Distributions or amounts
payable on redemption of the Capital Securities or otherwise, and, in such
event, holders of the Capital Securities will not be able to rely upon the
Guarantee for payment of such amounts. Instead, in the event a Debenture Event
of Default shall have occurred and be continuing and such event is
attributable to the failure of the Corporation to pay principal of (or
premium, if any) or interest on the Junior Subordinated Debentures on the
payment date on which such payment is due and payable, then a holder of
Capital Securities may institute a legal proceeding directly against the
Corporation for enforcement of payment to such holder of the principal of (or
premium, if any) or interest on such Junior Subordinated Debentures having a
principal amount equal to the Liquidation Amount of the Capital Securities of
such holder (a "Direct Action"). Notwithstanding any payments made to a holder
of Capital Securities by the Corporation in connection with a Direct Action,
the Corporation shall remain obligated to pay the principal of (and premium,
if any) and interest on the Junior Subordinated Debentures, and the
Corporation shall be subrogated to the rights of the holder of such Capital
Securities with respect to payments on the Capital Securities to the extent of
any payments made by the Corporation to such holder in any Direct Action.
Except as described herein, holders of Capital Securities will not be able to
exercise directly any other remedy available to the holders of the Junior
Subordinated Debentures or to assert directly any other rights in respect of
the Junior Subordinated Debentures. See "Description of Junior Subordinated
Debentures--Enforcement of Certain Rights by Holders of Capital Securities,"
"Description of Junior Subordinated Debentures--Debenture Events of Default"
and "Description of Guarantee." The Trust Agreement will provide that each
holder of Capital Securities by acceptance thereof agrees to the provisions of
the Indenture.
LIMITED VOTING RIGHTS
Holders of Capital Securities will generally have limited voting rights
relating only to the modification of the Capital Securities, the termination
or liquidation of the Trust, and the exercise of the Trust's rights as holder
of Junior Subordinated Debentures. Holders of Capital Securities will not be
entitled to vote to appoint, remove or replace the Property Trustee or the
Delaware Trustee, and such voting rights are vested exclusively in the holder
of the Common Securities except 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
Capital Securities to ensure that the Trust will be classified for United
States federal income tax purposes as a grantor trust even if such action
adversely affects the interests of such holders. See "Description of Capital
Securities--Voting Rights; Amendment of the Trust Agreement" and "--Removal of
Issuer Trustees."
11
<PAGE>
ABSENCE OF PUBLIC MARKET
The Corporation does not intend to have the Capital Securities listed on the
New York Stock Exchange or any other securities exchange or for quotation
through the NASD Automated Quotation System. There is no existing market for
the Capital Securities and there can be no assurance as to the liquidity of
any market that may develop for the Capital Securities, the ability of the
holders to sell their Capital Securities or at what price holders of the
Capital Securities may be able to sell their Capital Securities, as the case
may be. Future trading prices of the Capital Securities will depend on many
factors including, among other things, prevailing interest rates, the
Corporation's operating results, and the market for similar securities. The
Underwriters have informed the Trust and the Corporation that the Underwriters
intend to make a market in the Capital Securities. However, the Underwriters
are not obligated to do so and any such market making activity may be
terminated at any time without notice to the holders of the Capital
Securities. In addition, such market making activity will be subject to the
limits of the Securities Act.
TRADING PRICE
The Capital Securities may trade at a price that does not fully reflect the
value of accrued but unpaid interest with respect to the underlying Junior
Subordinated Debentures. A holder who uses the accrual method of accounting
for tax purposes (and a cash method holder, if the Junior Subordinated
Debentures are deemed to have been issued with OID) and who disposes of its
Capital Securities between record dates for payments of distributions thereon
will be required to include accrued but unpaid interest on the Junior
Subordinated Debentures through the date of disposition in income as ordinary
income (i.e., interest or, possibly, OID), and to add such amount to its
adjusted tax basis in its share of the underlying Junior Subordinated
Debentures deemed disposed of. To the extent the selling price is less than
the holder's adjusted tax basis (which will include all accrued but unpaid
interest), a holder will recognize a capital loss. 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
Considerations--Interest Income and Original Issue Discount" and "--Sales of
Capital Securities."
12
<PAGE>
BANKBOSTON CORPORATION
The Corporation is a registered bank holding company organized in 1970 under
Massachusetts law with both national and international operations. The
Corporation, through its subsidiaries and, in certain cases, joint ventures,
is engaged in providing a wide variety of personal, corporate and global
banking services to individuals, corporate and institutional customers,
governments and other financial institutions. The Corporation, together with
its subsidiaries, operates a network of 650 offices across the United States
and more than 100 offices in 24 countries in Latin America, Europe, Asia and
Africa. The major banking subsidiaries of the Corporation include BankBoston,
N.A., Bank of Boston Connecticut and Rhode Island Hospital Trust National
Bank.
As of March 31, 1997, on a consolidated basis, the Corporation had total
assets of $64.8 billion, total deposits of $42.3 billion and total
stockholders' equity of $4.9 billion. The Corporation's banking subsidiaries
maintained 537 branches in Massachusetts, Rhode Island, Connecticut and New
Hampshire as of March 31, 1997. The Corporation's loans were diversified
geographically, with approximately 76 percent of its total loan volume
consisting of loans and leases made to domestic borrowers and the balance made
overseas. As of March 31, 1997, the Corporation's subsidiaries employed, in
the aggregate, approximately 22,000 full-time equivalent employees in their
domestic and foreign operations.
USE OF PROCEEDS
The proceeds to the Trust (without giving effect to expenses of the offering
payable by the Corporation) from the offering of the Capital Securities will
be $250,000,000. All of the proceeds from the sale of Capital Securities will
be invested by the Trust in the Junior Subordinated Debentures. The
Corporation intends that the net proceeds from the sale of the Junior
Subordinated Debentures will be used for general corporate purposes, which may
include, but not be limited to, one or more of the following: investments in
and advances to the Corporation's subsidiaries; financing future acquisitions
of financial institutions, as well as banking and other assets; and the
repurchase or redemption of certain of the Corporation's outstanding
securities. The precise amount and timing of the application of such net
proceeds used for such corporate purposes will depend on the funding
requirements and the availability of other funds to the Corporation and its
subsidiaries. Pending such application by the Corporation, such net proceeds
may be temporarily invested in short-term interest bearing securities.
The Capital Securities will be eligible to qualify as Tier 1 capital under
the capital guidelines of the Federal Reserve.
RATIOS OF EARNINGS TO FIXED CHARGES
The following table sets forth the ratios of earnings to fixed charges of
the Corporation for the respective periods indicated:
<TABLE>
<CAPTION>
THREE MONTHS
ENDED YEARS ENDED DECEMBER 31,
MARCH 31, ----------------------------
1997 1996 1995 1994 1993 1992
------------ ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges:
Excluding interest on deposits.... 2.31x 2.24x 2.08x 1.90x 2.44x 2.17x
Including interest on deposits.... 1.52 1.44 1.42 1.41 1.38 1.22
</TABLE>
13
<PAGE>
For purposes of computing the ratios of earnings to fixed charges, earnings
represent net income before extraordinary items and cumulative effect of
changes in accounting principles plus applicable income taxes and fixed
charges. Fixed charges, excluding interest on deposits, include gross interest
expense (other than on deposits) and the proportion deemed representative of
the interest factor of rent expense, net of income from subleases. Fixed
charges, including gross interest on deposits, include all interest expense
and the proportion deemed representative of the interest factor of rent
expense, net of income from subleases.
CAPITALIZATION
The following table sets forth the unaudited consolidated capitalization of
the Corporation as of March 31, 1997 and as adjusted to give effect to the
consummation of the offering of the Capital Securities offered hereby. The
following data should be read in conjunction with the financial information
included in the Corporation's 1996 Annual Report on Form 10-K and its
Quarterly Report on Form 10-Q for the quarter ended March 31, 1997, which are
incorporated herein by reference. See "Incorporation of Certain Documents by
Reference."
<TABLE>
<CAPTION>
MARCH 31, 1997
-------------------
AS
ACTUAL ADJUSTED(1)
------ -----------
(IN MILLIONS)
<S> <C> <C>
Total long-term debt....................................... $2,516 $2,516
------ ------
Obligated mandatory redeemable preferred securities of
subsidiary trusts holding solely parent debentures(2) .... 500 750
------ ------
Stockholders' equity:
Preferred stock.......................................... 508 508
Common stock-$1.50 par value-300,000,000 shares autho-
rized, 154,265,361 shares issued ....................... 231 231
Surplus.................................................. 1,259 1,259
Retained earnings........................................ 3,038 3,038
Net unrealized gains on securities available for sale,
net of tax ............................................. 21 21
Treasury stock, at cost.................................. (187) (187)
Cumulative translation adjustments, net of tax........... (9) (9)
------ ------
Total stockholders' equity............................. 4,861 4,861
------ ------
Total capitalization................................. $7,877 $8,127
====== ======
</TABLE>
- --------
(1) Reflects the issuance of the Capital Securities offered hereby.
(2) Obligated mandatory redeemable preferred securities of subsidiary trusts
holding solely parent debentures reflects the Capital Securities offered
hereby, the BankBoston Capital Trust I Capital Securities and the
BankBoston Capital Trust II Capital Securities. The Trust, BankBoston
Capital Trust I and BankBoston Capital Trust II are each subsidiaries of
the Corporation and holds the Floating Rate Junior Subordinated Deferrable
Interest Debentures due , 2027, the 8.25% Junior Subordinated
Deferrable Interest Debentures due December 15, 2026 and the 7 3/4% Junior
Subordinated Deferrable Interest Debentures due December 15, 2026,
respectively, as its sole assets.
14
<PAGE>
SUMMARY FINANCIAL DATA
The summary below should be read in connection with the financial information
included in the Corporation's 1996 Annual Report on Form 10-K and its Quarterly
Report on Form 10-Q for the quarter ended March 31, 1997. Interim unaudited
data for the three months ended March 31, 1997 and 1996 reflect, in the opinion
of management of the Corporation, all adjustments (consisting only of normal
recurring adjustments) necessary for a fair presentation of such data. Results
for the three months ended March 31, 1997 are not necessarily indicative of
results which may be expected for any other interim period or for the year as a
whole.
<TABLE>
<CAPTION>
THREE MONTHS
ENDED
MARCH 31,(1) YEARS ENDED DECEMBER 31,
--------------- ----------------------------------------
1997 1996 1996 1995 1994 1993 1992
------- ------- ------- ------- ------- ------- -------
(UNAUDITED) (DOLLARS IN MILLIONS, EXCEPT PER SHARE
DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Net interest revenue.... $ 620 $ 566 $ 2,340 $ 2,249 $ 2,037 $ 1,769 $ 1,672
Provision for credit
losses................. 60 57 231 275 154 107 288
------- ------- ------- ------- ------- ------- -------
Net interest revenue
after provision for
credit losses.......... 560 509 2,109 1,974 1,883 1,662 1,384
Noninterest income...... 330 285 1,344 1,309 1,035 945 1,020
Noninterest expense..... 544 527 2,320 2,076 1,947 2,002 1,949
------- ------- ------- ------- ------- ------- -------
Income before income
taxes, extraordinary
items and cumulative
effect of changes in
accounting principles.. 346 267 1,133 1,207 971 605 455
Provision for income
taxes.................. 139 112 483 529 422 262 190
------- ------- ------- ------- ------- ------- -------
Income before
extraordinary items and
cumulative effect of
changes in accounting
principles............. 207 155 650 678 549 343 265
Extraordinary items, net
of tax................. (7) 73
Cumulative effect of
changes in accounting
principles, net........ 24
------- ------- ------- ------- ------- ------- -------
Net income............ $ 207 $ 155 $ 650 $ 678 $ 542 $ 367 $ 338
======= ======= ======= ======= ======= ======= =======
Per common share:
Income before
extraordinary items
and cumulative effect
of changes in
accounting principles:
Primary............... $ 1.29 $ .94 $ 3.99 $ 4.17 $ 3.44 $ 2.09 $ 1.77
Fully diluted......... 1.27 .93 3.93 4.09 3.36 2.05 1.73
Net income:
Primary............... 1.29 .94 3.99 4.17 3.39 2.26 2.30
Fully diluted......... 1.27 .93 3.93 4.09 3.31 2.21 2.24
Book value............. 28.67 27.14 28.89 27.01 23.07 21.13 18.98
Cash dividends
declared(2)........... .44 .37 1.69 1.28 .93 .40 .10
Average number of common
shares (in thousands):
Primary................ 153,421 154,988 153,529 153,856 148,913 147,033 138,444
Fully diluted.......... 155,592 156,844 156,112 156,768 153,616 152,067 144,044
AVERAGE BALANCE SHEET
DATA:
Loans and lease financ-
ing.................... $41,732 $39,179 $40,589 $38,283 $36,017 $32,565 $31,568
Total earning assets.... 56,641 52,172 53,410 49,567 47,517 42,880 41,658
Total assets............ 63,224 58,587 59,523 55,744 53,389 47,937 46,290
Deposits................ 41,899 40,632 41,603 38,406 37,919 37,163 37,643
Notes payable........... 3,316 2,421 2,666 2,142 2,123 1,797 1,252
Stockholders' equity.... 4,952 4,706 4,744 4,304 3,766 3,390 2,762
</TABLE>
- --------
(1) Financial data for 1996 has been restated to give retroactive effect to the
acquisition of BayBanks, Inc., which was completed in July 1996 and
accounted for as a pooling of interests.
(2)Amounts represent the historical cash dividends of the Corporation.
15
<PAGE>
BANKBOSTON CAPITAL TRUST III
The Trust is a statutory business trust formed under Delaware law pursuant
to (i) the Trust Agreement executed by the Corporation, as Sponsor, 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 May 14, 1997.
The Trust exists for the exclusive purposes of (i) issuing and selling the
Trust Securities, (ii) using the proceeds from the sale of Trust Securities to
acquire the Junior Subordinated Debentures and, (iii) engaging in only those
other activities necessary, advisable or incidental thereto (such as
registering the transfer of the Trust Securities). The Junior Subordinated
Debentures will be the sole assets of the Trust and, accordingly, payments
under the Junior Subordinated Debentures will be the sole revenues of the
Trust. All of the Common Securities will be owned by the Corporation. The
Common Securities will rank pari passu, and payments will be made thereon pro
rata, with the Capital Securities, except that upon the occurrence and
continuance of an event of default under the Trust Agreement resulting from a
Debenture Event of Default, the rights of the Corporation as holder of the
Common Securities to payments in respect of Distributions and payments upon
liquidation, redemption or otherwise will be subordinated to the rights of the
holders of the Capital Securities. See "Description of Capital Securities--
Subordination of Common Securities." The Corporation will acquire Common
Securities in a Liquidation Amount equal to at least 3% of the total capital
of the Trust. The Trust has a term of 31 years, but may terminate earlier as
provided in the Trust Agreement. The Trust's business and affairs are
conducted by its trustees, each appointed by the Corporation as holder of the
Common Securities. The trustees for the Trust will be 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 three
individual trustees (the "Administrative Trustees") who are employees or
officers of or affiliated with the Corporation (collectively, the "Issuer
Trustees"). The Bank of New York, as Property Trustee, will act as sole
indenture trustee under the Trust Agreement. The Bank of New York will also
act as indenture trustee under the Guarantee and the Indenture. See
"Description of Guarantee" and "Description of Junior Subordinated
Debentures." The holder of the Common Securities of the Trust or, if an Event
of Default under the Trust Agreement has occurred and is continuing, the
holders of a majority in Liquidation Amount of the Capital Securities will be
entitled to appoint, remove or replace the Property Trustee and/or the
Delaware Trustee. In no event will the holders of the Capital Securities have
the right to vote to appoint, remove or replace the Administrative Trustees;
such voting rights will be vested exclusively in the holder of the Common
Securities. The duties and obligations of each Issuer Trustee are governed by
the Trust Agreement. The Corporation will pay all fees, expenses, debts and
obligations (other than with respect to the payment of principal, interest and
premium, if any, on the Trust Securities) related to the Trust and the
offering of the Capital Securities and will pay, directly or indirectly, all
ongoing costs, expenses and liabilities of the Trust (other than payment of
principal, interest and premium, if any, on the Trust Securities). The
principal executive office of the Trust is c/o BankBoston, P.O. Box 2016,
Boston, Massachusetts 02106-2016.
16
<PAGE>
DESCRIPTION OF CAPITAL SECURITIES
The Capital Securities will represent preferred beneficial interests in the
Trust and the holders thereof will be entitled to a preference over the Common
Securities in certain circumstances with respect to Distributions and amounts
payable on redemption of the Trust Securities or liquidation of the Trust. See
"--Subordination of Common Securities." The Trust Agreement is qualified under
the Trust Indenture Act and is subject to and governed by the Trust Indenture
Act. This summary of certain terms and provisions of the Capital Securities,
the Common Securities and the Trust Agreement does not purport to be complete
and is subject to, and is qualified in its entirety by reference to, all the
provisions of the Trust Agreement, including the definitions therein of
certain terms, and those made a part of the Trust Agreement by the Trust
Indenture Act.
GENERAL
The Capital Securities will be limited to $250,000,000 aggregate Liquidation
Amount at any one time outstanding. The Capital Securities will rank pari
passu, and payments will be made thereon pro rata, with the Common Securities
except as described under "--Subordination of Common Securities." Legal title
to the Junior Subordinated Debentures will be held by the Property Trustee in
trust for the benefit of the holders of the Capital Securities and Common
Securities. The Guarantee will not guarantee payment of Distributions or
amounts payable on redemption of the Capital Securities or liquidation of the
Trust when the Trust does not have funds on hand legally available for such
payments. See "Description of Guarantee."
DISTRIBUTIONS
Distributions on the Capital Securities will be cumulative, will accumulate
from , 1997 and will be payable quarterly in arrears on
, , and of each year, commencing
, 1997 (each, a "Distribution Date"), at a rate per annum reset
quarterly equal to LIBOR plus % (the "Distribution Rate") on the
Liquidation Amount of $1,000, to the holders of the Capital Securities on the
relevant record dates. The record dates will be the day of the month in
which the relevant Distribution Date falls. The amount of Distributions
payable for any period will be computed on the basis of the actual number of
days in such period and a year of 360 days. In the event that any Distribution
Date is not a Business Day (as defined below), then such Distribution Date
shall be postponed to the next succeeding 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 succeeding calendar month then such
Distribution Date shall be the immediately preceding Business Day. If the
Stated Maturity Date or earlier prepayment date for the Junior Subordinated
Debentures falls on a day that is not a Business Day, payment of any
Distributions payable on such date will be made on the next succeeding
Business Day, and no interest or other payment will accumulate for the period
from and after the Stated Maturity Date or such prepayment date, as the case
may be. 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 or Boston,
Massachusetts are authorized or required by law or executive order to remain
closed.
So long as no Debenture Event of Default shall have occurred and be
continuing, the Corporation will have the right under the Indenture to defer
the payment of interest on the Junior Subordinated Debentures at any time or
from time to time for a period not exceeding 20 consecutive quarterly periods
with respect to each Extension Period, provided that no Extension Period may
extend beyond the Stated Maturity Date. Upon any such election, quarterly
Distributions on the Capital Securities will be deferred by the Trust during
any such Extension Period. Distributions to which holders of the Capital
Securities are entitled during any such Extension Period will accumulate
additional Distributions thereon at the applicable periodic Distribution Rate
compounded quarterly from the relevant Distribution Date, but not exceeding
the interest rate then accruing on the Junior Subordinated Debentures. The
term "Distributions," as used herein, shall include any such additional
Distributions.
Prior to the termination of any Extension Period, the Corporation may
further extend such Extension Period, provided that such extension does not
cause such Extension Period to exceed 20 consecutive quarterly periods or
17
<PAGE>
to extend beyond the Stated Maturity Date. Upon the termination of any such
Extension Period and the payment of all amounts then due, and subject to the
foregoing limitations, the Corporation may elect to begin a new Extension
Period. The Corporation must give the Property Trustee, the Administrative
Trustees and the Debenture Trustee notice of its election of any such
Extension Period at least five Business Days prior to the earlier of (i) the
date the Distributions on the Capital 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 any securities exchange
or to holders of such Capital Securities of the record date or the date such
Distributions are payable but in any event not less than five Business Days
prior to such record date. There is no limitation on the number of times that
the Corporation may elect to begin an Extension Period. See "Description of
Junior Subordinated Debentures--Option to Extend Interest Payment Period" and
"Certain Federal Income Tax Consequences--Interest Income and Original Issue
Discount."
During any Extension Period, the Corporation may not (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
(which includes common and preferred stock) or (ii) make any payment of
principal of or premium, if any, or interest on or repay, repurchase or redeem
any debt securities of the Corporation (including Other Debentures) that rank
pari passu with or junior in right of payment to the Junior 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
(including Other Guarantees) if such guarantee ranks pari passu with or junior
in right of payment to the Junior Subordinated Debentures (other than (a)
dividends or distributions in shares of, or options, warrants or rights to
subscribe for or purchase shares of, 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 Guarantee, (d) as a result of a reclassification of the
Corporation's capital stock or the exchange or conversion of one class, or
series of the Corporation's capital stock for another class or series of the
Corporation's capital stock, (e) the purchase of fractional interests in
shares of the Corporation's capital stock pursuant to the conversion or
exchange provisions of such capital stock or the security being converted or
exchanged, and (f) 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 or any of the Corporation's dividend
reinvestment plans).
Although the Corporation may in the future exercise its option to defer
payments of interest on the Junior Subordinated Debentures, the Corporation
has no such current intention.
The revenue of the Trust available for distribution to holders of the
Capital Securities will be limited to payments under the Junior Subordinated
Debentures in which the Trust will invest the proceeds from the issuance and
sale of the Trust Securities. See "Description of Junior Subordinated
Debentures--General." If the Corporation does not make interest payments on
the Junior Subordinated Debentures, the Property Trustee will not have funds
available to pay Distributions on the Capital Securities. The payment of
Distributions on the Capital Securities (if and to the extent the Trust has
funds on hand legally available for the payment of such Distributions) will be
guaranteed by the Corporation on a limited basis as set forth herein under
"Description of Guarantee."
DISTRIBUTION RATE
LIBOR, the Distribution period and the amount of Distributions payable in
respect of each Distribution period will be calculated by The Bank of New
York, as Calculation Agent, in the same manner as LIBOR, the interest period
and the interest payable in respect of each interest period for the Junior
Subordinated Debentures, as described under "Description of Junior
Subordinated Debentures--Interest Rate."
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REDEMPTION
Upon the repayment on the Stated Maturity Date or prepayment prior to the
Stated Maturity Date of the Junior Subordinated Debentures, the proceeds from
such repayment or prepayment shall be applied by the Property Trustee to
redeem a Like Amount (as defined below) of the Trust Securities, upon not less
than 30 nor more than 60 days' notice of a date of redemption (the "Redemption
Date"), at the applicable Redemption Price, which shall be equal to (i) in the
case of the repayment of the Junior Subordinated Debentures on the Stated
Maturity Date, the Maturity Redemption Price (equal to the principal of, and
accrued interest on, the Junior Subordinated Debentures), (ii) in the case of
the optional prepayment of the Junior Subordinated Debentures upon the
occurrence and continuation of a Special Event, the Early Redemption Price
(equal to the Prepayment Price in respect of the Junior Subordinated
Debentures) and (iii) in the case of the optional prepayment of the Junior
Subordinated Debentures other than as contemplated in clause (ii) above, the
Early Redemption Price (equal to the Prepayment Price in respect of the Junior
Subordinated Debentures). See "Description of Junior Subordinated Debentures--
Optional Prepayment" and "--Special Event Prepayment."
"Like Amount" means (i) with respect to a redemption of the Trust
Securities, Trust Securities having a Liquidation Amount equal to the
principal amount of Junior Subordinated Debentures to be paid in accordance
with their terms and (ii) with respect to a distribution of Junior
Subordinated Debentures upon the liquidation of the Trust, Junior Subordinated
Debentures having a principal amount equal to the Liquidation Amount of the
Trust Securities of the holder to whom such Junior Subordinated Debentures are
distributed.
The Corporation will have the option to prepay the Junior Subordinated
Debentures, (i) in whole or in part, on or after , 2007, and (ii) in
whole but not in part, at any time, upon the occurrence of a Special Event, in
each case at the Prepayment Price and subject to receipt of prior approval by
the Federal Reserve if then required under applicable capital guidelines or
policies of the Federal Reserve.
LIQUIDATION OF THE TRUST AND DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES
The Corporation will have the right at any time to terminate the Trust and
cause the Junior Subordinated Debentures to be distributed to the holders of
the Trust Securities in liquidation of the Trust. Such right is subject to (i)
the Corporation having received an opinion of counsel to the effect that such
distribution will not be a taxable event to holders of Capital Securities and
(ii) the prior approval of the Federal Reserve if then required under
applicable capital guidelines or policies of the Federal Reserve.
The Trust shall automatically terminate upon the first to occur of: (i)
certain events of bankruptcy, dissolution or liquidation of the Corporation;
(ii) the distribution of a Like Amount of the Junior Subordinated Debentures
to the holders of the Trust Securities, if the Corporation, as Sponsor, has
given written direction to the Property Trustee to terminate the Trust (which
direction is optional and, except as described above, wholly within the
discretion of the Corporation, as Depositor); (iii) redemption of all of the
Trust Securities as described under "--Redemption"; (iv) expiration of the
term of the Trust; and (v) the entry of an order for the dissolution of the
Trust by a court of competent jurisdiction.
If a termination occurs as described in clause (i), (ii), (iv), or (v)
above, the Trust shall be liquidated by the Issuer Trustees as expeditiously
as the Issuer Trustees determine to be possible by distributing, after
satisfaction of liabilities to creditors of the Trust as provided by
applicable law, to the holders of the Trust Securities a Like Amount of the
Junior Subordinated Debentures, unless such distribution is determined by the
Property Trustee not to be practicable, in which event such holders will be
entitled to receive out of the assets of the Trust legally available for
distribution to holders, after satisfaction of liabilities to creditors of the
Trust as provided by applicable law, an amount equal to the aggregate of the
Liquidation Amount of $1,000 per Trust Security plus accumulated and unpaid
Distributions thereon to the date of payment (such amount being the
"Liquidation Distribution"). If such Liquidation Distribution can be paid only
in part because the Trust has insufficient assets on hand legally available to
pay in full the aggregate Liquidation Distribution, then the amounts payable
directly by the Trust on the Capital Securities and the Common Securities
shall be paid on a pro rata basis, except that if
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a Debenture Event of Default has occurred and is continuing, the Capital
Securities shall have a priority over the Common Securities. See "--
Subordination of Common Securities." If an early termination occurs as
described in clause (v) above, the Junior Subordinated Debentures will be
subject to optional prepayment, in whole but not in part, on or after
, 2007.
If the Corporation elects not to prepay the Junior Subordinated Debentures
prior to maturity in accordance with their terms and either elects not to or
is unable to liquidate the Trust and distribute the Junior Subordinated
Debentures to holders of the Trust Securities, the Trust Securities will
remain outstanding until the repayment of the Junior Subordinated Debentures
on the Stated Maturity Date.
After the liquidation date is fixed for any distribution of Junior
Subordinated Debentures to holders of the Trust Securities, (i) the Trust
Securities will no longer be deemed to be outstanding, (ii) each registered
global certificate, if any, representing Trust Securities and held by The
Depository Trust Company ("DTC" or the "Depositary") or its nominee will be
exchanged for a registered global certificate or certificates representing the
Junior Subordinated Debentures to be delivered upon such distribution and
(iii) any certificates representing Trust Securities not held by DTC or its
nominee will be deemed to represent Junior Subordinated Debentures having a
principal amount equal to the Liquidation Amount of such Trust Securities, and
bearing accrued and unpaid interest in an amount equal to the accumulated and
unpaid Distributions on such Trust Securities until such certificates are
presented to the Administrative Trustees or their agent for cancellation,
whereupon the Corporation will issue to such holder, and the Debenture Trustee
will authenticate, a certificate representing such Junior Subordinated
Debentures.
There can be no assurance as to the market prices for the Capital Securities
or the Junior Subordinated Debentures that may be distributed in exchange for
the Trust Securities if a dissolution and liquidation of the Trust were to
occur. Accordingly, the Capital Securities that an investor may purchase, or
the Junior Subordinated Debentures that the investor may receive on
dissolution and liquidation of the Trust, may trade at a discount to the price
that the investor paid to purchase the Capital Securities offered hereby.
REDEMPTION PROCEDURES
If applicable, Trust Securities shall be redeemed at the applicable
Redemption Price with the proceeds from the contemporaneous repayment or
prepayment of the Junior Subordinated Debentures. Any redemption of Trust
Securities shall be made and the applicable Redemption Price shall be payable
on the Redemption Date only to the extent that the Trust has funds legally
available for the payment of such applicable Redemption Price. See also "--
Subordination of Common Securities."
If the Trust gives a notice of redemption in respect of the Capital
Securities, then, by 12:00 noon, New York City time, on the Redemption Date,
to the extent funds are legally available, with respect to the Capital
Securities held by DTC or its nominees, the Property Trustee will deposit
irrevocably with DTC funds sufficient to pay the applicable Redemption Price.
See "--Form, Denomination, Book-Entry Procedures and Transfer." With respect
to the Capital Securities held in certificated form, the Property Trustee, to
the extent funds are legally available, will irrevocably deposit with the
paying agent for the Capital Securities funds sufficient to pay the applicable
Redemption Price and will give such paying agent irrevocable instructions and
authority to pay the applicable Redemption Price to the holders thereof upon
surrender of their certificates evidencing the Capital Securities. See "--
Payment and Paying Agency." Notwithstanding the foregoing, Distributions
payable on or prior to the Redemption Date shall be payable to the holders of
such Capital 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 the Capital Securities will cease, except the right of the holders
of the Capital Securities to receive the applicable Redemption Price, but
without interest on such Redemption Price, and the Capital Securities will
cease to be outstanding. In the event that payment of the applicable
Redemption Price is improperly withheld or refused and not paid either by the
Trust or by the Corporation pursuant to the Guarantee as described under
"Description of Guarantee," Distributions on Capital Securities will continue
to accumulate at the then applicable rate, from the Redemption Date originally
established by the Trust to the date such applicable Redemption Price is
actually paid, in which case the actual payment date will be the Redemption
Date for purposes of calculating the applicable Redemption Price.
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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 Capital Securities by tender, in
the open market or by private agreement.
Notice of any redemption will be mailed at least 30 days but not more than
60 days prior to the Redemption Date to each holder of Trust Securities at its
registered address. Unless the Corporation defaults in payment of the
applicable Prepayment Price on, or in the repayment of, the Junior
Subordinated Debentures, on and after the Redemption Date Distributions will
cease to accrue on the Trust Securities called for redemption.
SUBORDINATION OF COMMON SECURITIES
Payment of Distributions on, and the Redemption Price of, the Capital
Securities and Common Securities, as applicable, shall be made pro rata based
on the Liquidation Amount of the Capital Securities and Common Securities;
provided, however, that if on any Distribution Date or Redemption Date a
Debenture Event of Default shall have occurred and be continuing, no payment
of any Distribution on, or applicable Redemption Price of, any of the Common
Securities, and no other payment on account of the redemption, liquidation or
other acquisition of the Common Securities, shall be made unless payment in
full in cash of all accumulated and unpaid Distributions on all of the
outstanding Capital Securities for all Distribution periods terminating on or
prior thereto, or in the case of payment of the applicable Redemption Price
the full amount of such Redemption Price, 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 Capital Securities then due and payable.
In the case of any Event of Default, the Corporation as holder of the Common
Securities will be deemed to have waived any right to act with respect to such
Event of Default until the effect of such Event of Default shall have been
cured, waived or otherwise eliminated. Until any such Event of Default has
been so cured, waived or otherwise eliminated, the Property Trustee shall act
solely on behalf of the holders of the Capital Securities and not on behalf of
the Corporation as holder of the Common Securities, and only the holders of
the Capital Securities will have the right to direct the Property Trustee to
act on their behalf.
EVENTS OF DEFAULT; NOTICE
The occurrence of a Debenture Event of Default (see "Description of Junior
Subordinated Debentures--Debenture Events of Default") constitutes an "Event
of Default" under the Trust Agreement.
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 Capital Securities, the
Administrative Trustees and the Corporation, as Sponsor, unless such Event of
Default shall have been cured or waived. The Corporation, as Sponsor, 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.
If a Debenture Event of Default has occurred and is continuing, the Capital
Securities shall have a preference over the Common Securities as described
under "--Liquidation of the Trust and Distribution of Junior Subordinated
Debentures" and "--Subordination of Common Securities."
REMOVAL OF ISSUER TRUSTEES
Unless a Debenture Event of Default shall have occurred and be continuing,
any Issuer Trustee may be removed at any time by the holder of the Common
Securities. If a Debenture Event of Default 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 Capital
Securities. In no event will the holders of the Capital 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
Common Securities. No resignation or removal of an 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.
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MERGER OR CONSOLIDATION OF 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 Issuer Trustee shall be a
party, or any corporation succeeding to all or substantially all the corporate
trust business of such Issuer Trustee, shall be the successor of such Issuer
Trustee under the Trust Agreement, provided such corporation shall be
otherwise qualified and eligible.
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 as an
entirety or substantially as an entirety to any corporation or other Person,
except as described below. The Trust may, at the request of the Corporation,
as Sponsor, with the consent of the Administrative Trustees but without the
consent of the holders of the Capital Securities, merge with or into,
consolidate, amalgamate, or be replaced by or convey, transfer or lease its
properties and assets as an entirety or 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 Capital Securities or (b) substitutes for the
Capital Securities other securities having substantially the same terms as the
Capital Securities (the "Successor Securities") so long as the Successor
Securities rank the same as the Capital Securities rank 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 duties as the Property Trustee with
respect to the Junior Subordinated Debentures, (iii) the Successor Securities
are listed, or any Successor Securities will be listed upon notification of
issuance, on any national securities exchange or other organization on which
the Capital Securities are then listed, if any, (iv) such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease does
not cause the Capital 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 Capital Securities (including any 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 Corporation has received an
opinion from independent counsel to the Trust 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 Capital Securities (including
any Successor Securities) in any material respect, and (b) following such
merger, consolidation, amalgamation, replacement, conveyance, transfer or
lease, neither the Trust 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 (viii) the Corporation 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 Trust Securities, consolidate,
amalgamate, merge with or into, or be replaced by or convey, transfer or lease
its properties and assets as an entirety or 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 not to be classified as a grantor trust for United States
federal income tax purposes.
VOTING RIGHTS; AMENDMENT OF THE TRUST AGREEMENT
Except as provided below and under "--Mergers, Consolidations, Amalgamations
or Replacements of the Trust" and "Description of Guarantee--Amendments and
Assignment" and as otherwise required by law and the Trust Agreement, the
holders of the Capital Securities will have no voting rights.
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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 Trust Securities (i) to 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) to
modify, eliminate or add to any provisions of the Trust Agreement to such
extent as shall be necessary to ensure that the Trust will be classified for
United States federal income tax purposes as a grantor trust 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 Investment Company
Act; provided, however, that in the case of clause (i), such action shall not
adversely affect in any material respect the interests of the holders of the
Trust Securities, and any amendments of the Trust Agreement shall become
effective when notice thereof is given to the holders of the Trust Securities.
The Trust Agreement may be amended by the Issuer Trustees and the Corporation
(i) with the consent of holders of a majority in Liquidation Amount of the
outstanding Trust Securities, and (ii) upon receipt by the Issuer Trustees of
an opinion of counsel to the effect that such amendment or the exercise of any
power granted to the Issuer Trustees in accordance with such amendment will
not affect the Trust's status as a grantor trust for United States federal
income tax purposes or the Trust's exemption from status as an "investment
company" under the Investment Company Act, provided that, without the consent
of each holder of Trust Securities, the 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 holder of Trust Securities to institute suit for the enforcement of
any such payment on or after such date.
So long as any Junior Subordinated Debentures are held by the Property
Trustee, the 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 such Property Trustee
with respect to the Junior Subordinated Debentures, (ii) waive certain past
defaults under the Indenture, (iii) exercise any right to rescind or annul a
declaration of acceleration of the maturity of the principal of the Junior
Subordinated Debentures or (iv) consent to any amendment, modification or
termination of the Indenture or the Junior Subordinated Debentures, where such
consent shall be required, without, in each case, obtaining the prior approval
of the holders of a majority in Liquidation Amount of all outstanding Capital
Securities; provided, however, that where a consent under the Indenture would
require the consent of each holder of Junior Subordinated Debentures affected
thereby, no such consent shall be given by the Property Trustee without the
prior approval of each holder of the Capital Securities. The Issuer Trustees
shall not revoke any action previously authorized or approved by a vote of the
holders of the Capital Securities except by subsequent vote of such holders.
The Property Trustee shall notify each holder of Capital Securities of any
notice of default with respect to the Junior Subordinated Debentures. In
addition to obtaining the foregoing approvals of such holders of the Capital
Securities, prior to taking any of the foregoing actions, the Issuer Trustees
shall obtain an opinion of counsel experienced in such matters to the effect
that the Trust will not be classified as an association taxable as a
corporation for United States federal income tax purposes on account of such
action.
Any required approval of holders of Capital Securities may be given at a
meeting of such holders convened for such purpose or pursuant to written
consent. The Property Trustee will cause a notice of any meeting at which
holders of Capital 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 Capital Securities in the manner set forth in the
Trust Agreement.
No vote or consent of the holders of Capital Securities will be required for
the Trust to redeem and cancel the Capital Securities in accordance with the
Trust Agreement.
Notwithstanding that holders of the Capital Securities are entitled to vote
or consent under any of the circumstances described above, any of the Capital
Securities that are owned by the Corporation, the Issuer Trustees or any
affiliate of the Corporation or any Issuer Trustees, shall, for purposes of
such vote or consent, be treated as if they were not outstanding.
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FORM, DENOMINATION, BOOK-ENTRY PROCEDURES AND TRANSFER
The Capital Securities initially will be represented by one or more Capital
Securities in registered, global form (collectively, the "Global Capital
Securities"). The Global Capital Securities will be deposited upon issuance
with the Property Trustee as custodian for DTC, in The City of New York, and
registered in the name of DTC or its nominee, in each case for credit to an
account of a direct or indirect participant in DTC as described below. Except
as set forth below, the Global Capital Securities may be transferred, in whole
and not in part, only to another nominee of DTC or to a successor of DTC or
its nominee. Beneficial interests in the Global Capital Securities may not be
exchanged for Capital Securities in certificated form except in the limited
circumstances described below. See "--Exchange of Book-Entry Capital
Securities for Certificated Capital Securities".
Transfer of beneficial interests in the Global Capital Securities will be
subject to the applicable rules and procedures of DTC and its direct or
indirect participants, which may change from time to time.
Depositary Procedures
DTC has advised the Trust and the Corporation that DTC is a limited-purpose
trust company created to hold securities for its participating organizations
(collectively, the "Participants") and to facilitate the clearance and
settlement of transactions in those securities between Participants through
electronic book-entry changes in accounts of its Participants. The
Participants include securities brokers and dealers (including the
Underwriters), banks, trust companies, clearing corporations and certain other
organizations. Access to DTC's system is also available to other entities such
as banks, brokers, dealers and trust companies that clear through or maintain
a custodial relationship with a Participant, either directly or indirectly
(collectively, the "Indirect Participants"). Persons who are not Participants
may beneficially own securities held by or on behalf of DTC only through the
Participants or the Indirect Participants. The ownership interest and transfer
of ownership interest of each actual purchaser of each security held by or on
behalf of DTC are recorded on the records of the Participants and Indirect
Participants.
DTC has also advised the Trust and the Corporation that, pursuant to
procedures established by it, (i) upon deposit of the Global Capital
Securities, DTC will credit the accounts of Participants designated by the
Underwriters with portions of the Liquidation Amount of the Global Capital
Securities and (ii) ownership of such interests in the Global Capital
Securities will be shown on, and the transfer of ownership thereof will be
effected only through, records maintained by DTC (with respect to the
Participants) or by the Participants and the Indirect Participants (with
respect to other owners of beneficial interests in the Global Capital
Securities).
Except as described below, owners of beneficial interests in the Global
Capital Securities will not have Capital Securities registered in their name,
will not receive physical delivery of Capital Securities in certificated form
and will not be considered the registered owners or holders thereof under the
Trust Agreement for any purpose.
Payments in respect of the Global Capital Security registered in the name of
DTC or its nominee will be payable by the Property Trustee to DTC in its
capacity as the registered holder under the Trust Agreement. Under the terms
of the Trust Agreement, the Property Trustee will treat the persons in whose
names the Capital Securities, including the Global Capital Securities, are
registered as the owners thereof for the purpose of receiving such payments
and for any and all other purposes whatsoever. Consequently, neither the
Property Trustee nor any agent thereof has or will have any responsibility or
liability for (i) any aspect of DTC's records or any Participant's or Indirect
Participant's records relating to or payments made on account of beneficial
interests in the Global Capital Securities, or for maintaining, supervising or
reviewing any of DTC's records or any Participant's or Indirect Participant's
records relating to the beneficial interests in the Global Capital Securities
or (ii) any other matter relating to the actions and practices of DTC or any
of its Participants or Indirect Participants. DTC has advised the Trust and
the Corporation that its current practice, upon receipt of any payment in
respect of securities such as the Capital Securities, is to credit the
accounts of the relevant Participants with
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the payment on the payment date, in amounts proportionate to their respective
holdings in Liquidation Amount of beneficial interests in the relevant
security as shown on the records of DTC unless DTC has reason to believe it
will not receive payment on such payment date. Payments by the Participants
and the Indirect Participants to the beneficial owners of Capital Securities
will be governed by standing instructions and customary practices and will be
the responsibility of the Participants or the Indirect Participants and will
not be the responsibility of DTC, the Property Trustee, the Trust or the
Corporation. Neither the Trust or the Corporation nor the Property Trustee
will be liable for any delay by DTC or any of its Participants in identifying
the beneficial owners of the Capital Securities, and the Trust or the
Corporation and the Property Trustee may conclusively rely on and will be
protected in relying on instructions from DTC or its nominee for all purposes.
Beneficial interests in the Global Capital Securities will trade in DTC's
Same-Day Funds Settlement System and secondary market trading activity in such
interests will therefore settle in immediately available funds, subject in all
cases to the rules and procedures of DTC and its participants.
DTC has advised the Trust and the Corporation that it will take any action
permitted to be taken by a holder of Capital Securities only at the direction
of one or more Participants to whose account with DTC interests in the Global
Capital Securities are credited and only in respect of such portion of the
Liquidation Amount of the Capital Securities as to which such Participant or
Participants has or have given such direction. However, if there is an Event
of Default under the Trust Agreement, DTC reserves the right to exchange the
Global Capital Securities for legended Capital Securities in certificated form
and to distribute such Capital Securities to its Participants.
The information in this section concerning DTC and its book-entry system has
been obtained from sources that the Trust and the Corporation believe to be
reliable, but neither the Trust nor the Corporation takes responsibility for
the accuracy thereof.
Exchange of Book-Entry Capital Securities for Certificated Capital Securities
A Global Capital Security is exchangeable for Capital Securities in
registered certificated form if (i) DTC (x) notifies the Trust that it is
unwilling or unable to continue as Depositary for the Global Capital Security
and the Trust thereupon fails to appoint a successor Depositary within 90 days
or (y) has ceased to be a clearing agency registered under the Exchange Act,
(ii) the Corporation in its sole discretion elects to cause the issuance of
the Capital Securities in certificated form or (iii) there shall have occurred
and be continuing an Event of Default or any event which after notice or lapse
of time or both would be an Event of Default under the Trust Agreement. In
addition, beneficial interests in a Global Capital Security may be exchanged
for certificated Capital Securities upon request but only upon at least 20
days prior written notice given to the Property Trustee by or on behalf of DTC
in accordance with customary procedures. In all cases, certificated Capital
Securities delivered in exchange for any Global Capital Security or beneficial
interests therein will be registered in the names, and issued in any approved
denominations, requested by or on behalf of the Depositary (in accordance with
its customary procedures), unless the Property Trustee determines otherwise in
compliance with applicable law.
PAYMENT AND PAYING AGENCY
Payments in respect of Global Capital Securities shall be made to DTC, which
shall credit the relevant accounts at DTC on the applicable Distribution
Dates, while payments in respect of Capital Securities in certificated form
shall be made by check mailed to the address of the holder entitled thereto as
such address shall appear on the register. The paying agent (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
Corporation. The Paying Agent shall be permitted to resign as Paying Agent
upon 30 days' written notice to the Property Trustee and the Corporation. In
the event that the Property 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.
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REGISTRAR AND TRANSFER AGENT
The Property Trustee will act as registrar and transfer agent for the
Capital Securities.
Registration of transfers of the Capital Securities will be effected without
charge by or on behalf of the Trust, but upon payment of any tax or other
governmental charges that may be imposed in connection with any transfer or
exchange. The Trust will not be required to register or cause to be registered
the transfer of the Capital Securities after they have been called for
redemption.
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 Trust
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 Capital
Securities or the Common 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 Trust 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 Trust in such a way that the Trust 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
Junior Subordinated Debentures will be 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 of the
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 Trust Securities.
Holders of the Trust Securities have no preemptive or similar rights.
The Trust may not borrow money, issue debt, execute mortgages or pledge any
of its assets.
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DESCRIPTION OF JUNIOR SUBORDINATED DEBENTURES
The Junior Subordinated Debentures are to be issued under an Indenture, as
supplemented from time to time (as so supplemented, the "Indenture"), between
the Corporation and the Debenture Trustee. The Indenture is qualified under the
Trust Indenture Act. This summary of certain terms and provisions of the Junior
Subordinated Debentures and the Indenture does not purport to be complete and
is subject to, and is qualified in its entirety by reference to, all of the
provisions of the Indenture, including the definitions therein of certain
terms, and those terms made a part of the Indenture by the Trust Indenture Act.
GENERAL
Concurrently with the issuance of the Trust Securities, the Trust will invest
the proceeds thereof, together with the consideration paid by the Corporation
for the Common Securities, in Junior Subordinated Debentures issued by the
Corporation. The Junior Subordinated Debentures will bear interest at a rate
per annum reset quarterly equal to LIBOR plus % (the "Interest Rate") on the
principal amount thereof, payable quarterly in arrears on , ,
and of each year, commencing , 1997 (each, an "Interest Payment
Date"), to the person in whose name each Junior Subordinated Debenture is
registered, subject to certain exceptions, at the close of business on the
day of the month in which the relevant Interest Payment Date falls. It is
anticipated that, until the liquidation, if any, of the Trust, each Junior
Subordinated Debenture will be held in the name of the Property Trustee in
trust for the benefit of the holders of the Trust Securities. The amount of
interest payable for any period will be computed on the basis of the actual
number of days elapsed in such period and a year of 360 days. In the event that
any Interest Payment Date is not a Business Day, then such Interest Payment
Date shall be postponed to the next succeeding Business Day, except that if
such Business Day falls in the next succeeding calendar month then such
Interest Payment Date shall be the immediately preceding Business Day. If the
Stated Maturity Date or earlier prepayment date for the Junior Subordinated
Debentures falls on a day that is not a Business Day, payment of interest on
such date will be made on the next succeeding Business Day, and no interest or
other payment will accrue for the period from and after the Stated Maturity
Date or such prepayment date, as the case may be. 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 Interest Rate,
compounded quarterly. The term "interest", as used herein, shall include
quarterly interest payments, interest on quarterly interest payments not paid
on the applicable Interest Payment Date and Additional Sums (as defined below),
as applicable.
The Junior Subordinated Debentures will be issued in denominations of $1,000
and integral multiples thereof. The Junior Subordinated Debentures will mature
on , 2027 (the "Stated Maturity Date").
The Junior Subordinated Debentures will rank pari passu with all Other
Debentures and will be unsecured and subordinate and junior in right of payment
to the extent and in the manner set forth in the Indenture to all Senior
Indebtedness. See "--Subordination." The Corporation is a non-operating holding
company and almost all of the operating assets of the Corporation and its
consolidated subsidiaries are owned by such subsidiaries. The Corporation
relies primarily on dividends from such subsidiaries to meet its obligations.
The Corporation is a legal entity separate and distinct from its banking and
non-banking affiliates. The principal sources of the Corporation's income are
dividends, interest and fees from its banking and non-banking affiliates. The
bank subsidiaries of the Corporation (the "Banks") are subject to certain
restrictions imposed by federal law on any extensions of credit to, and certain
other transactions with, the Corporation and certain other affiliates, and on
investments in stock or other securities thereof. Such restrictions prevent the
Corporation and such other affiliates from borrowing from the Banks unless the
loans are secured by various types of collateral. Further, such secured loans,
other transactions and investments by any of the Banks are generally limited in
amount as to the Corporation and as to each of such other affiliates to 10% of
such Bank's capital and surplus and as to the Corporation and all of such other
affiliates to an aggregate of 20% of such Bank's capital and surplus. In
addition, payment of dividends to the Corporation by the subsidiary banks is
subject to ongoing review by banking regulators and is subject to various
statutory limitations and in certain circumstances requires approval by
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banking regulatory authorities. 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 the subsidiary,
except to the extent the Corporation may itself be recognized as a creditor of
that subsidiary. Accordingly, the Junior Subordinated Debentures will be
effectively subordinated to all existing and future liabilities of the
Corporation's subsidiaries, and holders of Junior Subordinated Debentures
should look only to the assets of the Corporation for payments on the Junior
Subordinated Debentures. The Indenture does not limit the incurrence or
issuance of other secured or unsecured debt, including Senior Indebtedness, of
the Corporation or its subsidiaries. See "--Subordination."
INTEREST RATE
The interest period with respect to the Junior Subordinated Debentures is
each successive period from and including the immediately preceding Interest
Payment Date (or the date of original issuance, in the case of the initial
interest period) to but excluding the applicable Interest Payment Date. The
Bank of New York, as Calculation Agent (the "Calculation Agent"), will
calculate the Interest Rate for each interest period based on LIBOR determined
as of two London Business Days (defined as any day on which dealings in U.S.
dollars are transacted in the London interbank market) prior to the first day
of such interest period (each, a "Determination Date"). "LIBOR" means, with
respect to an interest period relating to an Interest Payment Date (in the
following order of priority):
(1) the rate (expressed as a percentage per annum) for Eurodollar
deposits having a three-month maturity that appears on Telerate Page 3750
as of 11:00 a.m. (London time) on the related Determination Date;
(2) if such rate does not appear on Telerate page 3750 as of 11:00 a.m.
(London time) on the related Determination Date, LIBOR will be the
arithmetic mean (if necessary rounded upwards to the nearest whole multiple
of 0.00001%) of the rates (expressed as percentages per annum) for
Eurodollar deposits having a three-month maturity that appear on Reuters
Monitor Money Rates Page LIBO ("Reuters Page LIBO") as of 11:00 a.m.
(London time) on such Determination Date;
(3) if such rate does not appear on Reuters Page LIBO as of 11:00 a.m.
(London time) on the related Determination Date, the Calculation Agent will
request the principal London offices of four leading banks in the London
interbank market to provide such banks' offered quotations (expressed as
percentages per annum) to prime banks in the London interbank market for
Eurodollar deposits having a three-month maturity as of 11:00 a.m. (London
time) on such Determination Date and, if at least two quotations are so
provided, LIBOR will be the arithmetic mean (if necessary rounded upwards
to the nearest whole multiple of 0.00001%) of such quotations;
(4) if fewer than two such quotations are provided as requested in clause
(3) above, the Calculation Agent will request four major New York City
banks to provide such banks' offered quotations (expressed as percentages
per annum) to leading European banks for loans in Eurodollars having a
three-month maturity as of 11:00 a.m. (London time) on the related
Determination Date and, if at least two such quotations are so provided,
LIBOR will be the arithmetic mean (if necessary rounded upwards to the
nearest whole multiple of 0.00001%) of such quotations; and
(5) if fewer than two such quotations are provided as requested in clause
(4) above, LIBOR will be LIBOR as determined on the immediately preceding
Determination Date.
If the rate for Eurodollar deposits having a three-month maturity that
initially appears on Telerate Page 3750 or Reuters Page LIBO, as the case may
be, as of 11:00 a.m. (London time) on the related Determination Date is
superseded on Telerate Page 3750 or Reuters Page LIBO, as the case may be, by
a corrected rate before 12:00 noon (London time) on such Determination Date,
such corrected rate will be the applicable LIBOR for such Determination Date.
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Absent manifest error, the Calculation Agent's determination of LIBOR and
its calculation of the applicable Interest Rate for each interest period will
be final and binding. Investors may obtain the interest rates for the current
and preceding interest period by writing or calling the Corporate Trust
Department of the Calculation Agent at 101 Barclay Street, New York, New York
10286 (telephone (212) 815-5915).
FORM, REGISTRATION AND TRANSFER
If the Junior Subordinated Debentures are distributed to the holders of the
Trust Securities, the Junior Subordinated Debentures may be represented by one
or more global certificates registered in the name of Cede & Co. as the
nominee of DTC. The depositary arrangements for such Junior Subordinated
Debentures are expected to be substantially similar to those in effect for the
Capital Securities. For a description of DTC and the terms of the depositary
arrangements relating to payments, transfers, voting rights, prepayments,
notices and other matters, see "Description of Capital Securities--Form,
Denomination, Book-Entry Procedures and Transfer."
PAYMENT AND PAYING AGENTS
Payment of principal of (and premium, if any) and any interest on Junior
Subordinated Debentures will be made at the office of the Debenture Trustee in
The City of New York or at the office 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 except in the case of
Junior Subordinated Debentures in global form, (i) by check mailed to the
address of the Person entitled thereto as such address shall appear in the
register for Junior Subordinated Debentures or (ii) by transfer to an account
maintained by the Person entitled thereto as specified in such register,
provided that proper transfer instructions have been received by the relevant
Record Date. Payment of any interest on any Junior Subordinated Debenture will
be made to the Person in whose name such Junior Subordinated Debenture is
registered at the close of business on the 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 Junior Subordinated Debentures.
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 of (and
premium, if any) or interest on any Junior Subordinated Debenture and
remaining unclaimed for two years after such principal (and premium, if any)
or interest has become due and payable shall, at the request of the
Corporation, be repaid to the Corporation and the holder of such Junior
Subordinated Debenture shall thereafter look, as a general unsecured creditor,
only to the Corporation for payment thereof.
OPTION TO EXTEND INTEREST PAYMENT DATE
So long as no Debenture Event of Default has occurred and is continuing, the
Corporation will have the right under the Indenture at any time during the
term of the Junior Subordinated Debentures to defer the payment of interest at
any time or from time to time for a period not exceeding 20 consecutive
quarterly periods with respect to each Extension Period, provided that no
Extension Period may extend beyond the Stated Maturity Date. At the end of
such Extension Period, the Corporation must pay all interest then accrued and
unpaid (together with interest thereon at the applicable Interest Rate,
compounded quarterly, to the extent permitted by applicable law). During an
Extension Period, interest will continue to accrue and holders of Junior
Subordinated Debentures (and holders of the Trust Securities while Trust
Securities are outstanding) will be required to accrue interest income for
United States federal income tax purposes prior to the receipt of cash
attributable to such income. See "Certain Federal Income Tax Consequences--
Interest Income and Original Issue Discount."
During any Extension Period, the Corporation may not (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
(which includes common and preferred stock) or (ii) make any payment of
principal, interest or premium,
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if any, on or repay, repurchase or redeem any debt securities of the
Corporation (including any Other Debentures) that rank pari passu with or
junior in right of payment to the Junior 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 (including any Other
Guarantees) if such guarantee ranks pari passu with or junior in right of
payment to the Junior Subordinated Debentures (other than (a) dividends or
distributions in shares of or options, warrants or rights to subscribe for or
purchase shares of, 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
Guarantee, (d) as a result of a reclassification of the Corporation's capital
stock or the exchange or conversion of one class or series of the
Corporation's capital stock for another class or series of the Corporation's
capital stock (e) the purchase of fractional interests in shares of the
Corporation's capital stock pursuant to the conversion or exchange provisions
of such capital stock or the security being converted or exchanged, and (f)
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 or any of the Corporation's dividend reinvestment plans).
Prior to the termination of any Extension Period, the Corporation may
further extend such Extension Period, provided that such extension does not
cause such Extension Period to exceed 20 consecutive quarterly periods or to
extend beyond the Stated Maturity Date. Upon the termination of any such
Extension Period and 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 must give the
Property Trustee, the Administrative Trustees and the Debenture Trustee notice
of its election of any Extension Period (or an extension thereof) at least
five Business Days prior to the earlier of (i) the date the Distributions on
the Trust Securities would have been payable except for the election to begin
or extend such Extension Period or (ii) the date the Administrative Trustees
are required to give notice to any securities exchange or to holders of
Capital Securities of the record date or the date such Distributions are
payable, but in any event not less than five Business Days prior to such
record date. The Debenture Trustee shall give notice of the Corporation's
election to begin or extend a new Extension Period to the holders of the
Capital Securities. There is no limitation on the number of times that the
Corporation may elect to begin an Extension Period.
OPTIONAL PREPAYMENT
The Junior Subordinated Debentures will be prepayable, in whole or in part,
at the option of the Corporation on or after 2007, subject to the
Corporation having received prior approval of the Federal Reserve if then
required under applicable capital guidelines or policies of the Federal
Reserve, at a Prepayment Price equal to 100% of the principal amount of the
Junior Subordinated Debentures so redeemed plus accrued interest thereon to
the date of prepayment.
SPECIAL EVENT PREPAYMENT
If a Special Event shall occur and be continuing, the Corporation may, at
its option and subject to receipt of prior approval of the Federal Reserve if
then required under applicable capital guidelines or policies of the Federal
Reserve, prepay the Junior Subordinated Debentures in whole (but not in part)
at any time within 90 days of the occurrence of such Special Event, at a
Prepayment Price equal to 100% of the principal amount of the Junior
Subordinated Debentures plus accrued interest thereon to the date of
prepayment.
A "Special Event" means a Tax Event or a Regulatory Capital Event (as
defined below), as the case may be.
A "Tax Event" means the receipt by the Corporation and 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 prospective change)
in, the laws or any regulations thereunder of the United States or any
political subdivision or taxing
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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 , 1997, there is more than an
insubstantial risk that (i) the Trust 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 Junior Subordinated Debentures, (ii) the
interest payable by the Corporation on the Junior Subordinated Debentures is
not, or within 90 days of the date of such opinion will not be, deductible by
the Corporation, in whole or in part, for United States federal income tax
purposes, or (iii) the Trust is, or will be within 90 days of the date of such
opinion, subject to more than a de minimis amount of other taxes, duties or
other governmental charges.
A "Regulatory Capital Event" means that the Corporation shall have received
an opinion of independent bank regulatory counsel experienced in such matters
to the effect that, as a result of (a) any amendment to, or change (including
any announced prospective change) in, the laws (or any regulations thereunder)
of the United States or any rules, guidelines or policies of the Federal
Reserve or (b) 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
, 1997, the Capital Securities do not constitute, or within 90
days of the date thereof, will not constitute, Tier I capital (or its then
equivalent); provided, however, that the distribution of the Junior
Subordinated Debentures in connection with the liquidation of the Trust by the
Corporation shall not in and of itself constitute a Regulatory Capital Event
unless such liquidation shall have occurred in connection with a Tax Event.
"Additional Sums" means the additional amounts as may be necessary in order
that the amount of Distributions then due and payable by the Trust on the
outstanding Capital Securities and Common Securities shall not be reduced as a
result of any additional taxes, duties and other governmental charges to which
the Trust has become subject as a result of a Tax Event.
Notice of any prepayment will be mailed at least 30 days but not more than
60 days before the redemption date to each holder of Junior Subordinated
Debentures to be prepaid at its registered address. Unless the Corporation
defaults in payment of the prepayment price, on and after the prepayment date
interest ceases to accrue on such Junior Subordinated Debentures called for
prepayment.
If the Trust 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 Junior Subordinated Debentures the Additional Sums.
RESTRICTIONS ON CERTAIN PAYMENTS
The Corporation will also covenant that it will not, (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
(which includes common and preferred stock) or (ii) make any payment of
principal, interest or premium, if any, on or repay or repurchase or redeem
any debt securities of the Corporation (including Other Debentures) that rank
pari passu with or junior in right of payment to the Junior 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
(including under Other Guarantees) if such guarantee ranks pari passu or
junior in right of payment to the Junior Subordinated Debentures (other than
(a) dividends or distributions in shares of, or options, warrants or rights to
subscribe for or purchase shares of, common stock of the Corporation, (b) any
declaration of a dividend in connection with the implementation of a
stockholder's 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 Guarantee, (d) as a result of a reclassification of the
Corporation's capital stock or the exchange or conversion of one class or
series of the Corporation's capital stock for another class or series of the
Corporation's capital stock (e) the purchase of fractional interests in shares
of the Corporation's capital stock pursuant to the conversion or exchange
provisions of such capital stock or the security being converted or exchanged,
and (f) purchases of common stock related to the issuance of common stock or
rights under any of the Corporation's
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benefit plans for its directors, officers or employees or any of the
Corporation's dividend reinvestment plans) if at such time (1) there shall
have occurred any event of which the Corporation has actual knowledge that (a)
is, or with the giving of notice or the lapse of time, or both, would be, a
Debenture Event of Default and (b) in respect of which the Corporation shall
not have taken reasonable steps to cure, (2) if such Junior Subordinated
Debentures are held by the Trust, the Corporation shall be in default with
respect to its payment of any obligations under the Guarantee or (3) 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, and such
Extension Period, or any extension thereof, shall have commenced.
MODIFICATION OF INDENTURE
From time to time the Corporation and the Debenture Trustee may, without the
consent of the holders of Junior 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
Junior 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 a majority in principal amount of Junior
Subordinated Debentures, to modify the Indenture in a manner affecting the
rights of the holders of Junior Subordinated Debentures; provided, that no
such modification may, without the consent of the holders of each outstanding
Junior Subordinated Debenture so affected, (i) change the Stated Maturity
Date, or reduce the principal amount of the Junior Subordinated Debentures or
reduce the rate or extend the time of payment of interest thereon or (ii)
reduce the percentage of principal amount of Junior Subordinated Debentures,
the holders of which are required to consent to any such modification of the
Indenture.
DEBENTURE EVENTS OF DEFAULT
The Indenture provides that any one or more of the following described
events with respect to the Junior Subordinated Debentures constitutes a
"Debenture Event of Default" (whatever the reason for such Debenture 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) failure for 30 days to pay any interest on the Junior Subordinated
Debentures or any Other 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 or premium, if any, on the Junior
Subordinated Debentures or any Other Debentures when due, whether at
maturity, upon redemption, by declaration of acceleration of maturity 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 Junior Subordinated
Debentures; or
(iv) certain events in bankruptcy, insolvency or reorganization of the
Corporation.
The holders of a majority in aggregate outstanding principal amount of the
Junior 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 Junior Subordinated Debentures
may declare the principal due and payable immediately upon a Debenture Event
of Default. The holders of a majority in aggregate outstanding principal
amount of the Junior Subordinated Debentures may annul such declaration and
waive the default if the default (other than the non-payment of the principal
of the Junior 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.
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The holders of a majority in aggregate outstanding principal amount of the
Junior Subordinated Debentures affected thereby may, on behalf of the holders
of all the Junior Subordinated Debentures, waive any past default, except a
default in the payment of principal (or premium, if any) on or interest
(unless such default has been cured and a sum sufficient to pay all matured
installments of interest (and premium, if any) 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
Junior Subordinated Debenture.
ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF CAPITAL SECURITIES
If a Debenture Event of Default shall have occurred and be continuing and
shall be attributable to the failure of the Corporation to pay interest (or
premium, if any) on principal of the Junior Subordinated Debentures on the due
date, a holder of Capital Securities may institute 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
Capital Securities outstanding. If the right to bring a Direct Action is
removed, the Trust may become subject to the reporting obligations under the
Exchange Act. Notwithstanding any payments made to a holder of Capital
Securities by the Corporation in connection with a Direct Action, the
Corporation shall remain obligated to pay the principal of (or premium, if
any) or interest on the Junior Subordinated Debentures, and the Corporation
shall be subrogated to the rights of the holder of such Capital Securities
with respect to payments on the Capital Securities to the extent of any
payments made by the Corporation to such holder in any Direct Action.
The holders of the Capital 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 Junior Subordinated Debentures unless there shall have
been an Event of Default under the Trust Agreement. See "Description of
Capital 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 as an entirety or 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 as an entirety or substantially as
an entirety to the Corporation, unless: (i) in case 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 Junior Subordinated Debentures; (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; and (iii) certain
other conditions as prescribed in the Indenture are met.
The general provisions of the Indenture do not afford holders of the Junior
Subordinated Debentures protection in the event of a highly leveraged or other
transaction involving the Corporation that may adversely affect holders of the
Junior Subordinated Debentures.
SATISFACTION AND DISCHARGE
The Indenture provides that when, among other things, all Junior
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 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 sufficient to pay and discharge the entire indebtedness on the
Junior Subordinated Debentures not previously delivered to the Debenture
Trustee for cancellation, for the principal (and premium, if any) and interest
to the date of the deposit or to the Stated Maturity Date, as the case may be,
then the Indenture will cease to be of further effect (except as to the
Corporation's obligations to
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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.
SUBORDINATION
In the Indenture, the Corporation has covenanted and agreed that any Junior
Subordinated Debentures issued thereunder will be subordinate and junior in
right of payment to all Senior Indebtedness 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 Indebtedness
will first be entitled to receive payment in full of all Allocable Amounts (as
defined below) in respect of such Senior Indebtedness before the holders of
Junior Subordinated Debentures will be entitled to receive or retain any
payment in respect thereof.
In the event of the acceleration of the maturity of Junior Subordinated
Debentures, the holders of all Senior Indebtedness outstanding at the time of
such acceleration will first be entitled to receive payment in full of all
Allocable Amounts in respect of such Senior Indebtedness before the holders of
Junior Subordinated Debentures will be entitled to receive or retain any
payment in respect of the Junior Subordinated Debentures.
No payments on account of principal (or premium, if any) or interest, if
any, in respect of the Junior Subordinated Debentures may be made if there
shall have occurred and be continuing a default in any payment with respect to
Senior Indebtedness, or an event of default with respect to any Senior
Indebtedness resulting in the acceleration of the maturity thereof, or if any
judicial proceeding shall be pending with respect to any such default.
"Allocable Amounts," when used with respect to any Senior Indebtedness,
means all amounts due or to become due on such Senior Indebtedness less, if
applicable, any amount which would have been paid to, and retained by, the
holders of such Senior Indebtedness (whether as a result of the receipt of
payments by the holders of such Senior Indebtedness from the Corporation or
any other obligor thereon or from any holders of, or trustee in respect of,
other indebtedness that is subordinate and junior in right of payment to such
Senior Indebtedness pursuant to any provision of such indebtedness for the
payment over of amounts received on account of such indebtedness to the
holders of such Senior Indebtedness or otherwise) but for the fact that such
Senior Indebtedness is subordinate or junior in right of payment to (or
subject to a requirement that amounts received on such Senior Indebtedness be
paid over to obligees on) trade accounts payable or accrued liabilities
arising in the ordinary course of business.
"Indebtedness for Money Borrowed" shall mean any obligation of, or any
obligation guaranteed by, the Corporation for the repayment of borrowed money,
whether or not evidenced by bonds, debentures, notes or other written
instruments.
"Indebtedness Ranking on a Parity with the Junior Subordinated Debentures"
shall mean (i) Indebtedness for Money Borrowed, whether outstanding on the
date of execution of the Indenture or thereafter created, assumed or incurred,
which specifically by its terms ranks equally with and not prior to the Junior
Subordinated Debentures in the right of payment upon the happening of the
dissolution or winding-up or liquidation or reorganization of the Corporation
and (ii) all other debt securities, and guarantees in respect of those debt
securities, issued to any other trust, or a trustee of such trust, partnership
or other entity affiliated with the Corporation that is a financing vehicle of
the Corporation (a "financing entity") in connection with the issuance by such
financing entity of equity securities or other securities guaranteed by the
Corporation pursuant to an instrument that ranks pari passu with or junior in
right of payment to the Guarantee.
"Indebtedness Ranking Junior to the Junior Subordinated Debentures" shall
mean any Indebtedness for Money Borrowed, whether outstanding on the date of
execution of the Indenture or thereafter created, assumed or incurred, which
specifically by its terms ranks junior to and not equally with or prior to the
Junior
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Subordinated Debentures (and any other Indebtedness Ranking on a Parity with
the Junior Subordinated Debentures) in right of payment upon the happening of
the dissolution or winding-up or liquidation or reorganization of the
Corporation. The securing of any Indebtedness for Money Borrowed, otherwise
constituting Indebtedness Ranking on a Parity with the Junior Subordinated
Debentures or Indebtedness Ranking Junior to the Junior Subordinated
Debentures, as the case may be, shall not be deemed to prevent such
Indebtedness for Money Borrowed from constituting Indebtedness Ranking on a
Parity with the Junior Subordinated Debentures or Indebtedness Ranking Junior
to the Junior Subordinated Debentures, as the case may be.
"Senior Indebtedness" shall mean all Indebtedness for Money Borrowed,
whether outstanding on the date of execution of the Indenture or thereafter
created, assumed or incurred, except Indebtedness Ranking on a Parity with the
Junior Subordinated Debentures or Indebtedness Ranking Junior to the Junior
Subordinated Debentures, and any deferrals, renewals or extensions of such
Senior Indebtedness.
The Indenture places no limitation on the amount of secured or unsecured
debt, including Senior Indebtedness, that may be incurred by the Corporation
or its subsidiaries. The Corporation and its subsidiaries expect from time to
time to incur additional indebtedness, including Senior Indebtedness.
GOVERNING LAW
The Indenture and the Junior Subordinated Debentures will be 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 Junior 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.
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DESCRIPTION OF GUARANTEE
The Guarantee will be executed and delivered by the Corporation concurrently
with the issuance by the Trust of the Capital Securities for the benefit of
the holders from time to time of the Capital Securities. The Bank of New York
will act as indenture trustee ("Guarantee Trustee") under the Guarantee. The
Guarantee is qualified as an indenture under the Trust Indenture Act. The
Guarantee Trustee will act as the Guarantee Trustee for the purposes of
compliance with the Trust Indenture Act and will hold the Guarantee for the
benefit of the holders of the Capital Securities. This summary of certain
terms and provisions of the 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 Guarantee, including the definitions therein of certain
terms, and those made a part of the Guarantee by the Trust Indenture Act.
GENERAL
The Corporation will irrevocably agree 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 Capital Securities, as and when due, regardless
of any defense, right of set-off or counterclaim that the Trust may have or
assert other than the defense of payment. The following payments with respect
to the Capital Securities, to the extent not paid by or on behalf of the Trust
(the "Guarantee Payments"), will be subject to the Guarantee: (i) any
accumulated and unpaid Distributions required to be paid on Capital
Securities, to the extent that the Trust has funds on hand legally available
therefor at such time, (ii) the applicable Redemption Price with respect to
Capital Securities called for redemption, to the extent that the Trust has
funds on hand legally available therefor at such time, or (iii) upon a
voluntary or involuntary termination and liquidation of the Trust (unless the
Junior Subordinated Debentures are distributed to holders of the Capital
Securities), the lesser of (a) the Liquidation Distribution and (b) the amount
of assets of the Trust remaining available for distribution to holders of
Capital Securities. 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 Capital Securities or by causing the Trust to pay such
amounts to such holders.
The Corporation will, through the Guarantee, the Trust Agreement, the Junior
Subordinated Debentures and the Indenture, taken together, fully, irrevocably
and unconditionally guarantee all of the Trust's obligations under the Capital
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 Trust's obligations under
the Capital Securities. See "Relationship Among the Capital Securities, the
Junior Subordinated Debentures and the Guarantee."
STATUS OF THE GUARANTEE
The Guarantee will constitute an unsecured obligation of the Corporation and
will rank subordinate and junior in right of payment to all Senior
Indebtedness in the same manner as Junior Subordinated Debentures, except in
the case of a bankruptcy or insolvency proceeding in respect of the
Corporation, in which case the Guarantee will rank subordinate and junior in
right of payment to all liabilities (other than Other Guarantees) of the
Corporation. The Guarantee will rank pari passu with all Other Guarantees
issued by the Corporation.
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 will be
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 "Description of the Junior
Subordinated Debentures--General." The Guarantee does not limit the incurrence
or issuance of debt of the Corporation's subsidiaries.
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The Guarantee will constitute a guarantee of payment and not of collection
(i.e., the guaranteed party may institute a legal proceeding directly against
the Corporation to enforce its rights under the Guarantee without first
instituting a legal proceeding against any other person or entity). The
Guarantee will be held for the benefit of the holders of the Capital
Securities. The Guarantee will not be discharged except by payment of the
Guarantee Payments in full to the extent not paid by the Trust or upon
distribution to the holders of the Capital Securities of the Junior
Subordinated Debentures. The Guarantee does not place a limitation on the
amount of additional Senior Indebtedness that may be incurred by the
Corporation. The Corporation expects from time to time to incur additional
indebtedness constituting Senior Indebtedness.
AMENDMENTS AND ASSIGNMENT
Except with respect to any changes that do not materially adversely affect
the rights of holders of the Capital Securities (in which case no vote or
consent will be required), the Guarantee may not be amended without the prior
approval of the holders of a majority of the Liquidation Amount of such
outstanding Capital Securities. The manner of obtaining any such approval will
be as set forth under "Description of the Capital Securities--Voting Rights;
Amendment of the Trust Agreement." All guarantees and agreements contained in
the Guarantee Agreement shall bind the successors, assigns, receivers,
trustees and representatives of the Corporation and shall inure to the benefit
of the holders of the Capital Securities then outstanding.
EVENTS OF DEFAULT
An event of default under the Guarantee will occur upon the failure of the
Corporation to perform any of its payment or other obligations thereunder. The
holders of a majority in Liquidation Amount of the Capital Securities will
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
Guarantee or to direct the exercise of any trust or power conferred upon the
Guarantee Trustee under the Guarantee.
Any holder of the Capital Securities may institute a legal proceeding
directly against the Corporation to enforce its rights under the Guarantee
without first instituting a legal proceeding against the Trust, the Guarantee
Trustee or any other person or entity.
The Corporation, as guarantor, will be 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
Guarantee.
INFORMATION CONCERNING THE GUARANTEE TRUSTEE
The Guarantee Trustee, other than during the occurrence and continuance of a
default by the Corporation in performance of the Guarantee, will undertake to
perform only such duties as are specifically set forth in the Guarantee and,
after default with respect to the 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 will be
under no obligation to exercise any of the powers vested in it by the
Guarantee at the request of any holder of the Capital Securities unless it is
offered reasonable indemnity against the costs, expenses and liabilities that
might be incurred thereby.
TERMINATION OF THE GUARANTEE
The Guarantee will terminate and be of no further force and effect upon full
payment of the applicable Redemption Price of the Capital Securities, upon
full payment of the Liquidation Amount payable upon liquidation of the Trust
or upon distribution of Junior Subordinated Debentures to the holders of the
Capital Securities. The Guarantee will continue to be effective or will be
reinstated, as the case may be, if at any time any holder of the Capital
Securities must restore payment of any sums paid under the Capital Securities
or the Guarantee.
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GOVERNING LAW
The Guarantee will be governed by and construed in accordance with the laws
of the State of New York.
RELATIONSHIP AMONG THE CAPITAL SECURITIES, THE
JUNIOR SUBORDINATED DEBENTURES AND THE GUARANTEE
FULL AND UNCONDITIONAL GUARANTEE
Payments of Distributions and other amounts due on the Capital Securities
(to the extent the Trust has funds on hand legally available for the payment
of such Distributions) will be irrevocably guaranteed by the Corporation as
and to the extent set forth under "Description of Guarantee." Taken together,
the Corporation's obligations under the Junior Subordinated Debentures, the
Indenture, the Trust Agreement and the Guarantee will provide, in the
aggregate, a full, irrevocable and unconditional guarantee of payments of
Distributions and other amounts due on the Capital 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 Trust's obligations under the Capital
Securities. If and to the extent that the Corporation does not make the
required payments on the Junior Subordinated Debentures, the Trust will not
have sufficient funds to make the related payments, including Distributions,
on the Capital Securities. The Guarantee will not cover any such payment when
the Trust does not have sufficient funds on hand legally available therefor.
In such event, the remedy of a holder of Capital Securities is to institute a
Direct Action. The obligations of the Corporation under the Guarantee will
rank subordinate and junior in right of payment to all Senior Indebtedness.
SUFFICIENCY OF PAYMENTS
As long as payments of interest and other payments are made when due on the
Junior Subordinated Debentures, such payments will be sufficient to cover
Distributions and other payments due on the Capital Securities, primarily
because: (i) the aggregate principal amount or Prepayment Price of the Junior
Subordinated Debentures will be equal to the sum of the Liquidation Amount or
Redemption Price, as applicable, of the Capital Securities and related Common
Securities; (ii) the Interest Rate and interest and other payment dates on the
Junior Subordinated Debentures will match the Distribution Rate and
Distribution and other payment dates for the Trust Securities; (iii) the
Corporation shall pay for all and any costs, expenses and liabilities of the
Trust except the Trust's obligations to holders of Trust Securities under such
Trust Securities; and (iv) the Trust Agreement will provide that the Trust is
not authorized to engage in any activity that is not consistent with the
limited purposes thereof.
ENFORCEMENT RIGHTS OF HOLDERS OF CAPITAL SECURITIES
A holder of any Capital Security may institute a legal proceeding directly
against the Corporation to enforce its rights under the Guarantee without
first instituting a legal proceeding against the Guarantee Trustee, the Trust
or any other person or entity. A default or event of default under any Senior
Indebtedness would not constitute a default or Event of Default under the
Trust Agreement. However, in the event of payment defaults under, or
acceleration of, Senior Indebtedness, the subordination provisions of the
Indenture will provide that no payments may be made in respect of the Junior
Subordinated Debentures until such Senior Indebtedness has been paid in full
or any payment default thereunder has been cured or waived. Failure to make
required payments on Junior Subordinated Debentures would constitute an Event
of Default under the Trust Agreement.
LIMITED PURPOSE OF THE TRUST
The Capital Securities will represent beneficial interests in the Trust, and
the Trust exists for the sole purpose of issuing and selling the Trust
Securities, using the proceeds from the sale of the Trust Securities to
acquire the Junior Subordinated Debentures and engaging in only those other
activities necessary, advisable or
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incidental thereto. A principal difference between the rights of a holder of a
Capital Security and a holder of a Junior Subordinated Debenture is that a
holder of a Junior Subordinated Debenture will be entitled to receive from the
Corporation the principal amount of (and premium, if any) and interest on
Junior Subordinated Debentures held, while a holder of Capital Securities is
entitled to receive Distributions from the Trust (or, in certain
circumstances, from the Corporation under the Guarantee) if and to the extent
the Trust has funds on hand legally available for the payment of such
Distributions.
RIGHTS UPON TERMINATION
Unless the Junior Subordinated Debentures are distributed to holders of the
Trust Securities, upon any voluntary or involuntary termination and
liquidation of the Trust, the holders of the Trust Securities will be entitled
to receive, out of assets held by the Trust, the Liquidation Distribution in
cash. See "Description of Capital Securities--Liquidation of the Trust and
Distribution of Junior Subordinated Debentures." Upon any voluntary or
involuntary liquidation or bankruptcy of the Corporation, the Property
Trustee, as holder of the Junior Subordinated Debentures, would be a
subordinated creditor of the Corporation, subordinated in right of payment to
all Senior Indebtedness as set forth in the Indenture, but entitled to receive
payment in full of principal (and premium, if any) and interest, before any
stockholders of the Corporation receive payments or distributions. Since the
Corporation will be the guarantor under the Guarantee and will agree to pay
for all costs, expenses and liabilities of the Trust (other than the Trust's
obligations to the holders of its Trust Securities), the positions of a holder
of Capital Securities and a holder of Junior Subordinated Debentures relative
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
GENERAL
In the opinion of Brown & Wood LLP, counsel to the Corporation and the Trust
("Tax Counsel"), the following is a summary of certain of the material United
States federal income tax consequences of the purchase, ownership and
disposition of Capital Securities held as capital assets by a holder who
purchases such Capital Securities upon initial issuance. It does not deal with
special classes of holders such as banks, thrifts, real estate investment
trusts, regulated investment companies, insurance companies, dealers in
securities or currencies, tax-exempt investors, or persons that will hold the
Capital Securities as a position in a "straddle," as part of a "synthetic
security" or "hedge," as part of a "conversion transaction" or other
integrated investment, or as other than a capital asset. This summary also
does not address the tax consequences to persons that have a functional
currency other than the U.S. dollar or the tax consequences to shareholders,
partners or beneficiaries of a holder of Capital Securities. Further, it does
not include any description of any alternative minimum tax consequences or the
tax laws of any state or local government or of any foreign government that
may be applicable to the Capital Securities. This summary is based on the
Internal Revenue Code of 1986, as amended (the "Code"), Treasury regulations
thereunder, the administrative and judicial interpretations thereof, as of the
date hereof, all of which are subject to change, possibly on a retroactive
basis.
CLASSIFICATION OF THE JUNIOR SUBORDINATED DEBENTURES
In connection with the issuance of the Junior Subordinated Debentures, Tax
Counsel will render its opinion generally to the effect that, under then
current law and assuming full compliance with the terms of the Indenture (and
certain other documents), and based on certain facts and assumptions contained
in such opinion, the Junior Subordinated Debentures will be classified for
United States federal income tax purposes as indebtedness of the Corporation.
An opinion of Tax Counsel, however, is not binding on the Internal Revenue
Service (the "IRS") or the courts. Prospective investors should note that no
rulings have been or are expected to be sought from the IRS with respect to
any of these issues and no assurance can be given that the IRS will not take
contrary positions. Moreover, no assurance can be given that any of the
opinions expressed herein will not be challenged by the IRS or, if challenged,
that such a challenge would not be successful.
CLASSIFICATION OF THE TRUST
In connection with the issuance of the Capital Securities, Tax Counsel will
render its opinion generally to the effect that, under then current law and
assuming full compliance with the terms of the Trust Agreement and the
Indenture (and certain other documents), and based on certain facts and
assumptions contained in such opinion, the Trust will be classified for United
States federal income tax purposes as a grantor trust and not as an
association taxable as a corporation. Accordingly, for United States federal
income tax purposes, each holder of Capital Securities generally will be
considered the owner of an undivided interest in the Junior Subordinated
Debentures, and each holder will be required to include in its gross income
any interest (or OID accrued) with respect to its allocable share of those
Junior Subordinated Debentures.
INTEREST INCOME AND ORIGINAL ISSUE DISCOUNT
Under recently issued Treasury regulations (the "Regulations") applicable to
debt instruments issued on or after August 13, 1996, a "remote" contingency
that stated interest will not be timely paid will be ignored in determining
whether a debt instrument is issued with OID. The Corporation believes that
the likelihood of its exercising its option to defer payments of interest is
"remote" since exercising that option would prevent the Corporation from
declaring dividends on any class of its equity securities. Accordingly, the
Corporation intends to take the position, based on the advice of Tax Counsel,
that the Junior Subordinated Debentures will not be considered to be issued
with OID and, accordingly, stated interest on the Junior Subordinated
Debentures generally will be taxable to a holder as ordinary income at the
time it is paid or accrued in accordance with such holder's method of
accounting.
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Under the Regulations, if the Corporation were to exercise its option to
defer payments of interest, the Junior Subordinated Debentures would at that
time be treated as issued with OID, and all stated interest on the Junior
Subordinated Debentures would thereafter be treated as OID as long as the
Junior Subordinated Debentures remain outstanding. In such event, all of a
holder's taxable interest income with respect to the Junior Subordinated
Debentures would thereafter be accounted for on an economic accrual basis
regardless of such holder's method of tax accounting, and actual distributions
of stated interest would not be reported as taxable income. Consequently, a
holder of Capital Securities would be required to include in gross income OID
even though the Corporation would not make actual cash payments during an
Extension Period. Moreover, under the Regulations, if the option to defer the
payment of interest was determined not to be "remote", the Junior Subordinated
Debentures would be treated as having been originally issued with OID. In such
event, all of a holder's taxable interest income with respect to the Junior
Subordinated Debentures would be accounted for on an economic accrual basis
regardless of such holder's method of tax accounting, and actual distributions
of stated interest would not be reported as taxable income.
The Regulations have not yet been addressed in any rulings or other
interpretations by the IRS, and it is possible that the IRS could take a
position contrary to Tax Counsel's interpretation herein.
Because income on the Capital Securities will constitute interest or OID,
corporate holders of the Capital Securities will not be entitled to a
dividends-received deduction with respect to any income recognized with
respect to the Capital Securities.
RECEIPT OF JUNIOR SUBORDINATED DEBENTURES OR CASH UPON LIQUIDATION OF THE
TRUST
The Corporation will have the right at any time to liquidate the Trust and
cause the Junior Subordinated Debentures to be distributed to the holders of
the Trust Securities, subject to (i) the Corporation having received an
opinion of counsel to the effect that such distribution will not be a taxable
event to holders of Capital Securities and (ii) the prior approval of the
Federal Reserve if then required under applicable capital guidelines or
policies of the Federal Reserve. Such a distribution, for United States
federal income tax purposes, would be treated as a nontaxable event to each
holder, and each holder would receive an aggregate tax basis in the Junior
Subordinated Debentures equal to such holder's aggregate tax basis in its
Capital Securities. A holder's holding period in the Junior Subordinated
Debentures so received in liquidation of the Trust would include the period
during which the Capital Securities were held by such holder. If, however, the
Trust is characterized for United States federal income tax purposes as an
association taxable as a corporation at the time of its dissolution, the
distribution of the Junior Subordinated Debentures may constitute a taxable
event to holders of Capital Securities and a holder's holding period in Junior
Subordinated Debentures would begin on the date such Junior Subordinated
Debentures were received.
Under certain circumstances described herein (see "Description of Capital
Securities"), the Junior Subordinated Debentures may be prepaid for cash and
the proceeds of such prepayment distributed to holders in redemption of their
Capital Securities. Under current law, such a redemption would, for United
States federal income tax purposes, constitute a taxable disposition of the
redeemed Capital Securities, and a holder could recognize gain or loss as if
it sold such redeemed Capital Securities for cash. See "--Sales of Capital
Securities."
SALES OF CAPITAL SECURITIES
A holder that sells Capital Securities (including a redemption of such
Capital Securities by the Corporation) will recognize gain or loss equal to
the difference between its adjusted tax basis in the Capital Securities and
the amount realized on the sale of such Capital Securities (other than with
respect to accrued and unpaid interest which has not yet been included in
income, which will be treated as ordinary income). A holder's adjusted tax
basis in the Capital Securities generally will be its initial purchase price
increased by OID (if any) previously includible in such holder's gross income
to the date of disposition and decreased by payments (if any) received on the
Capital Securities in respect of OID. Such gain or loss generally will be a
capital gain or loss and generally will be a long-term capital gain or loss if
the Capital Securities have been held for more than one year.
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The Capital Securities may trade at a price that does not accurately reflect
the value of accrued but unpaid interest with respect to the underlying Junior
Subordinated Debentures. A holder who uses the accrual method of accounting
for tax purposes (and a cash method holder, if the Junior Subordinated
Debentures are deemed to have been issued with OID) who disposes of his
Capital Securities between record dates for payments of distributions thereon
will be required to include accrued but unpaid interest on the Junior
Subordinated Debentures through the date of disposition in income as ordinary
income (i.e., interest or, possibly, OID), and to add such amount to his
adjusted tax basis in his pro rata share of the underlying Junior Subordinated
Debentures deemed disposed of. To the extent the selling price is less than
the holder's adjusted tax basis (which will include all accrued but unpaid
interest) a holder will recognize a capital loss. Subject to certain limited
exceptions, capital losses cannot be applied to offset ordinary income for
United States federal income tax purposes.
PROPOSED TAX LEGISLATION
On February 6, 1997, as part of the Clinton Administration's Fiscal 1998
Budget Proposal, the Treasury Department proposed legislation (the "Proposed
Legislation") which would, among other things, generally deny corporate
issuers a deduction for interest in respect of certain debt obligations, such
as the Junior Subordinated Debentures, issued on or after the date of "first
committee action," if such debt obligations have a maximum term in excess of
15 years and are not shown as indebtedness on the issuer's applicable
consolidated balance sheet. Since the Proposed Legislation has not yet been
introduced by any member of the 105th Congress, the Proposed Legislation
should not apply to the Junior Subordinated Debentures. It is possible,
however, that the Proposed Legislation or any other legislation enacted by
Congress may give rise to a Tax Event, in which event the Corporation would be
permitted, 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 Trust Securities at the Early Redemption Price by electing
to prepay the Junior Subordinated Debentures at the Prepayment Price. See
"Description of the Capital Securities--Redemption" and "Description of Junior
Subordinated Debentures--Special Event Prepayment."
UNITED STATES ALIEN HOLDERS
For purposes of this discussion, a "United States Alien Holder" is any
corporation, individual, partnership, estate or trust that is not a U.S.
Holder for United States federal income tax purposes. A "U.S. Holder" is a
holder of Capital Securities who or which is (i) a citizen or individual
resident (or is treated as a citizen or individual resident) of the United
States for federal income tax purposes, (ii) a corporation or partnership
created or organized (or treated as created or organized for federal income
tax purposes) in or under the laws of the United States or any political
subdivision thereof, (iii) an estate the income of which is includible in its
gross income for federal income tax purposes without regard to its source or
(iv) a trust if, and only if, (a) a court within the United States is able to
exercise primary supervision over the administration of the trust and (b) one
or more United States trustees have the authority to control all substantial
decisions of the trust). Under present United States federal income tax laws:
(i) payments by the Trust or any of its paying agents to any holder of a
Capital Security who or which is a United States Alien Holder will not be
subject to United States federal withholding tax; provided that, (a) the
beneficial owner of the Capital Security does not actually or constructively
own 10 percent or more of the total combined voting power of all classes of
stock of the Corporation entitled to vote, (b) the beneficial owner of the
Capital Security is not a controlled foreign corporation that is related to
the Corporation through stock ownership, and (c) either (A) the beneficial
owner of the Capital Security certifies to the Trust 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 Capital
Security in such capacity, certifies to the Trust or its agent, under
penalties of perjury, that such statement has been received from the
beneficial owner by it or by a Financial Institution between it and the
beneficial owner and furnishes the Trust or its agent with a copy thereof; and
(ii) a United States Alien Holder of a Capital Security will not be subject to
United States federal withholding tax on any gain realized upon the sale or
other disposition of a Capital Security.
42
<PAGE>
INFORMATION REPORTING TO HOLDERS
Generally, income on the Capital Securities will be reported to holders on
Forms 1099, which forms should be mailed to holders of Capital Securities by
January 31 following each calendar year.
BACKUP WITHHOLDING
Payments made on, and proceeds from the sale of, the Capital Securities may
be subject to a "backup" withholding tax of 31 percent unless the holder
complies with certain identification requirements. Any withheld amounts will
be allowed as a credit against the holder's United States federal income tax,
provided the required information is provided to the IRS.
THE UNITED STATES FEDERAL INCOME TAX DISCUSSION SET FORTH ABOVE IS INCLUDED
FOR GENERAL INFORMATION ONLY AND MAY NOT BE APPLICABLE DEPENDING UPON A
HOLDER'S PARTICULAR SITUATION. HOLDERS SHOULD CONSULT THEIR TAX ADVISORS WITH
RESPECT TO THE TAX CONSEQUENCES TO THEM OF THE PURCHASE, OWNERSHIP AND
DISPOSITION OF THE CAPITAL SECURITIES, INCLUDING THE TAX CONSEQUENCES UNDER
STATE, LOCAL, FOREIGN AND OTHER TAX LAWS AND THE POSSIBLE EFFECTS OF CHANGES
IN UNITED STATES FEDERAL OR OTHER TAX LAWS.
43
<PAGE>
ERISA CONSIDERATIONS
The Corporation, the obligor with respect to the Junior Subordinated
Debentures held by the Trust, and its affiliates and the Property Trustee may
be considered a "party in interest" (within the meaning of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA")) or a
"disqualified person" (within the meaning of Section 4975 of the Code) with
respect to many employee benefit plans ("Plans") that are subject to ERISA.
Any purchaser proposing to acquire Capital Securities with assets of any Plan
should consult with its counsel. The purchase and/or holding of Capital
Securities by a Plan that is subject to the fiduciary responsibility
provisions of ERISA or the prohibited transaction provisions of Section 4975
of the Code (including individual retirement arrangements and other plans
described in Section 4975(e)(1) of the Code) and with respect to which the
Corporation, the Property Trustee or any affiliate is a service provider (or
otherwise is a party in interest or a disqualified person) may constitute or
result in a prohibited transaction under ERISA or Section 4975 of the Code,
unless such Capital Securities are acquired pursuant to and in accordance with
an applicable exemption, such as Prohibited Transaction Class Exemption
("PTCE") 84-14 (an exemption for certain transactions determined by an
independent qualified professional asset manager), PTCE 91-38 (an exemption
for certain transactions involving bank collective investment funds), PTCE 90-
1 (an exemption for certain transactions involving insurance company pooled
separate accounts), PTCE 95-60 (an exemption for transactions involving
certain insurance company general accounts) or PTCE 96-23 (an exemption for
certain transactions determined by an in-house manager). In addition, a Plan
fiduciary considering the purchase of Capital Securities should be aware that
the assets of the Trust may be considered "plan assets" for ERISA purposes.
Therefore, a Plan fiduciary should consider whether the purchase of Capital
Securities could result in a delegation of fiduciary authority to the Property
Trustee, and, if so, whether such a delegation of authority is permissible
under the Plan's governing instrument or any investment management agreement
with the Plan. In making such determination, a Plan fiduciary should note that
the Property Trustee is a bank qualified to be an investment manager (within
the meaning of section 3(38) of ERISA) to which such a delegation of authority
generally would be permissible under ERISA. Further, prior to an Event of
Default with respect to the Junior Subordinated Debentures, the Property
Trustee will have only limited custodial and ministerial authority with
respect to Trust assets.
44
<PAGE>
UNDERWRITING
Subject to the terms and conditions set forth in the Purchase Agreement (the
"Purchase Agreement") among the Corporation, the Trust and Morgan Stanley &
Co. Incorporated ("Morgan Stanley"), CS First Boston Corporation, Lehman
Brothers Inc. and Salomon Brothers Inc (collectively, the "Underwriters"), the
Corporation and the Trust have agreed that the Trust will sell to the
Underwriters, and the Underwriters have agreed, severally and not jointly, to
purchase from the Trust, the respective number of Capital Securities set forth
below opposite their respective names.
<TABLE>
<CAPTION>
NUMBER OF
UNDERWRITER CAPITAL SECURITIES
----------- ------------------
<S> <C>
Morgan Stanley & Co. Incorporated......................
CS First Boston Corporation............................
Lehman Brothers Inc. ..................................
Salomon Brothers Inc...................................
---------
Total................................................ 250,000
=========
</TABLE>
The Underwriters propose to offer the Capital Securities initially at the
price to public set forth on the cover of this Prospectus and to certain
dealers at such price less a concession of not more than $ per Capital
Security. The Underwriters may allow and such dealers may reallow a concession
of not more than $ per Capital Security to certain other dealers. After the
initial offering, the price to public, concession and reallowance may be
changed.
The Purchase Agreement provides that the obligation of the Underwriters to
pay for and accept delivery of the Capital Securities is subject to certain
conditions, including delivery of certain legal opinions by counsel for the
Underwriters.
In view of the fact that the proceeds of the sale of the Capital Securities
will be invested in the Junior Subordinated Debentures, the Purchase Agreement
provides that the Corporation will pay, as compensation to the Underwriters,
an amount of $ per Capital Security.
The Capital Securities constitute a new issue of securities with no
established trading market. The Corporation has been advised by the
Underwriters that they intend to make a market in the Capital Securities, but
they are not obligated to do so and such market making may be interrupted or
discontinued without notice. No assurance can be given as to the development
or liquidity of any trading market for the Capital Securities.
The Corporation and the Trust have agreed in the Purchase Agreement that,
subject to certain conditions, prior to the closing under the Purchase
Agreement, neither will offer, sell, contract to sell or otherwise dispose of
any securities that are substantially similar to the Capital Securities or
that are convertible into or exchangeable for, or otherwise represent a right
to acquire, any such securities, except in the offering or with the prior
written consent of Morgan Stanley.
The Corporation and the Trust have agreed to indemnify the Underwriters and
certain other persons against certain liabilities, including liabilities under
the Securities Act, and to contribute to payments the Underwriters may be
required to make in respect thereof.
Any or all of the Underwriters have in the past and may in the future serve
as a financial advisor to the Corporation.
Because the National Association of Securities Dealers, Inc. ("NASD") is
expected to view the Capital Securities offered hereby as interests in a
direct participation program, the offering is being made in compliance with
Rule 2810 of the NASD's Conduct Rules. Offers and sales of Capital Securities
will be made only to (i)
45
<PAGE>
"qualified institutional buyers," as defined in Rule 144A under the Securities
Act or (ii) institutional "accredited
investors," as defined in Rule 501(a)(1), (2) or (3) of Regulation D under the
Securities Act, for whom an investment in the Capital Securities is
appropriate. The Underwriters may not confirm sales to any accounts over which
they exercise discretionary authority without the prior written approval of
the transaction by the customer.
Until the distribution of the Capital Securities is completed, rules of the
Commission may limit the ability of the Underwriters and certain selling group
members to bid for and purchase the Capital Securities. As an exception to
these rules, the representatives of the Underwriters (the "Representatives")
are permitted to engage in certain transactions that stabilize the price of
the Capital Securities. Such transactions consist of bids or purchases for the
purpose of pegging, fixing or maintaining the price of the Capital Securities.
If the Underwriters of the Capital Securities create a short position in the
Capital Securities offered hereby, i.e., if they sell more Capital Securities
than are set forth on the cover page of this Prospectus, then the
Representatives may reduce that short position by purchasing Capital
Securities in the open market. In general, purchases of a security for the
purpose of stabilization or to reduce a short position could cause the price
of the security to be higher than it might be in the absence of such
purchases. The Representatives may also impose a penalty bid on certain
Underwriters and selling group members. This means that if the Representatives
purchase Capital Securities in the open market to reduce the Underwriters'
short position or to stabilize the price of the Capital Securities, they may
reclaim the amount of the selling concession from the Underwriters and selling
group members who sold those Capital Securities as part of the offering. The
imposition of a penalty bid might also have an effect on the price of the
Capital Securities to the extent that it were to discourage resales of the
Capital Securities.
Neither the Trust nor any of the Underwriters makes any representation or
prediction as to the direction or magnitude of any effect that the
transactions described above may have on the price of the Capital Securities.
In addition, neither the Trust nor any of the Underwriters makes any
representation that the Representatives will engage in such transactions or
that such transactions, once commenced, will not be discontinued without
notice.
VALIDITY OF SECURITIES
The validity of the Capital Securities, the Guarantee and the Junior
Subordinated Debentures will be passed upon for the Corporation and the Trust
by Brown & Wood LLP, New York, New York and for the Underwriters by Skadden,
Arps, Slate, Meagher & Flom LLP, New York, New York. Certain matters relating
to United States federal income tax considerations will be passed upon for the
Corporation and the Trust by Brown & Wood LLP, New York, New York.
46
<PAGE>
EXPERTS
The consolidated financial statements of the Corporation and subsidiaries,
contained in and incorporated by reference into the Corporation's Annual
Report on Form 10-K for the year ended December 31, 1996, have been
incorporated herein by reference in reliance upon the reports set forth
therein of Coopers & Lybrand L.L.P., independent auditors, and upon the
authority of such firm as experts in accounting and auditing.
47
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NO DEALER, SALESMAN OR ANY OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS IN CONNECTION WITH THE OFFER MADE
BY THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS
MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE CORPORATION, THE
TRUST OR THE UNDERWRITERS. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY
SALE MADE HEREUNDER SHALL UNDER ANY CIRCUMSTANCE CREATE AN IMPLICATION THAT
THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE CORPORATION OR THE TRUST SINCE
THE DATE HEREOF. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER OR SOLICITATION
BY ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS NOT
AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT
QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR
SOLICITATION.
---------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information..................................................... 4
Incorporation of Certain Documents by Reference........................... 5
Prospectus Summary........................................................ 6
Risk Factors.............................................................. 9
BankBoston Corporation.................................................... 13
Use of Proceeds........................................................... 13
Ratios of Earnings to Fixed Charges....................................... 13
Capitalization............................................................ 14
Summary Financial Data.................................................... 15
BankBoston Capital Trust III.............................................. 16
Description of Capital Securities......................................... 17
Description of Junior Subordinated Debentures............................. 27
Description of Guarantee.................................................. 36
Relationship Among the Capital Securities, the Junior Subordinated
Debentures and the Guarantee............................................. 38
Certain Federal Income Tax Consequences................................... 40
ERISA Considerations...................................................... 44
Underwriting.............................................................. 45
Validity of Securities.................................................... 46
Experts................................................................... 47
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
$250,000,000
BANKBOSTON
CAPITAL TRUST III
FLOATING RATE CAPITAL SECURITIES
FULLY AND UNCONDITIONALLY GUARANTEED,
AS DESCRIBED HEREIN, BY
BANKBOSTON CORPORATION
LOGO
[LOGO OF BANKBOSTON APPEARS HERE]
---------------
PROSPECTUS
---------------
MORGAN STANLEY & CO. INCORPORATED
CS FIRST BOSTON CORPORATION
LEHMAN BROTHERS INC.
SALOMON BROTHERS INC
, 1997
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The estimated expenses in connection with the issuance and distribution of
the securities being registered, other than underwriting compensation, are:
<TABLE>
<S> <C>
Securities Act Registration Fee.............................. $ 75,757.58
Printing and Engraving Expenses.............................. 5,000.00
Legal Fees and Expenses...................................... 75,000.00
Accounting Fees and Expenses................................. 35,000.00
Trustee Expenses............................................. 6,000.00
Rating Agency Fees and Expenses.............................. 162,500.00
Miscellaneous................................................ 5,742.42
-----------
Total...................................................... $365,000.00
===========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 67 of Chapter 156B of the Massachusetts General Laws authorizes a
corporation to indemnify any director, officer, employee or other agent of the
corporation to whatever extent specified in or authorized by (i) the articles
of organization, (ii) a by-law adopted by the stockholders or (iii) a vote
adopted by the holders of a majority of the shares of stock entitled to vote
on the election of directors.
The Corporation's By-laws provide indemnity to the Corporation's directors
and officers in such capacity or as directors or officers of a wholly-owned
subsidiary of the Corporation for liability resulting from judgments, fines,
expenses or settlement amounts incurred in connection with any action,
including an action by or in the right of the Corporation, brought against
such person in such capacity. Under Massachusetts law and the By-laws, no
indemnification may be provided for any person with respect to any matter as
to which he or she shall have been adjudicated in any proceeding not to have
acted in good faith in the reasonable belief that his or her action was in the
best interest of the Corporation or of such subsidiary. The By-laws also
provide that, with respect to any matter disposed of by a compromise payment
by such director or officer pursuant to a consent decree or otherwise, no
indemnification shall be provided unless such compromise shall be ordered by a
court or shall be approved as being in the best interest of the Corporation,
after notice that it involves such indemnification: (a) by a disinterested
majority of the directors then in office or (b) by a majority of the
disinterested directors then in office, provided that there has been obtained
an opinion in writing of independent counsel to the effect that such person
does not appear not to have acted in good faith in the reasonable belief that
his or her action was in the best interests of the Corporation or (c) by the
holders of a majority of the outstanding stock at the time entitled to vote
for directors, exclusive of any stock owned by any interested director or
officer. Under Massachusetts law, a court may uphold indemnification in
connection with a suit in which there is a recovery or by in the right of a
corporation.
The By-laws also provide for indemnification for all other directors and
officers of the Corporation's wholly-owned subsidiaries to the extent
authorized by the Board of Directors in each individual case, based on the
same statutory standard set forth in the preceding paragraph. Where such a
person is wholly successful in defending the claim, he or she shall be
entitled to indemnification. Directors and officers of other subsidiaries and
employees and agents of the Corporation and any subsidiaries may be
indemnified as determined by the Board from time to time.
In addition, as permitted under Massachusetts law, the Corporation maintains
liability insurance covering directors and officers of the Corporation and its
subsidiaries.
II-1
<PAGE>
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
EXHIBIT
<TABLE>
<C> <S>
1 --Form of Purchase Agreement+
4.1 --Form of Indenture of BankBoston Corporation relating to the Junior
Subordinated Debentures+
4.2 --Form of Junior Subordinated Debenture (included as Exhibit A to
Exhibit 4.1)+
4.3 --Certificate of Trust of BankBoston Capital Trust III*
4.4 --Declaration of Trust of BankBoston Capital Trust III*
4.5 --Form of Amended and Restated Declaration of Trust for BankBoston
Capital Trust III+
4.6 --Form of Capital Security Certificate for BankBoston Capital Trust III
(included as Exhibit D to Exhibit 4.5)+
4.7 --Form of Guarantee of BankBoston Corporation relating to the Capital
Securities+
5.1 --Opinion and consent of Brown & Wood llp, special counsel to BankBoston
Corporation as to legality of the Junior Subordinated Debentures and
the Guarantee to be issued by BankBoston Corporation+
5.2 --Opinion of Skadden, Arps, Slate, Meagher & Flom LLP, special Delaware
counsel to BankBoston Capital Trust III, as to legality of the Capital
Securities to be issued by BankBoston Capital Trust III+
8 --Opinion of Brown & Wood LLP, special tax counsel, as to certain
federal income tax matters+
12.1 --Computation of ratio of earnings to fixed charges (excluding interest
on deposits), filed as Exhibit 12.1 to the Corporation's Quarterly
Report on Form 10-Q for the quarter ended March 31, 1997 and
incorporated herein by reference.
12.2 --Computation of ratio of earnings to fixed charges (including interest
on deposits) filed as Exhibit 12.2 to the Corporation's Quarterly
Report on Form 10-Q for the quarter ended March 31, 1997 and
incorporated herein by reference.
23.1 --Consent of Coopers & Lybrand L.L.P.*
23.2 --Consent of Brown & Wood LLP (included in Exhibit 5.1)+
23.3 --Consent of Skadden, Arps, Slate, Meagher & Flom (Delaware) (included
in Exhibit 5.2)+
24 --Power of Attorney of certain officers and directors of BankBoston
Corporation*
25.1 --Form T-1 Statement of Eligibility of The Bank of New York to act as
trustee under the Indenture+
25.2 --Form T-1 Statement of Eligibility of The Bank of New York to act as
trustee under the Amended and Restated Declaration of Trust of
BankBoston Capital Trust III+
25.3 --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 the
Capital Securities of BankBoston Capital Trust III+
</TABLE>
- --------
* Previously filed.
+ Filed herewith.
ITEM 17. UNDERTAKINGS
Each of the undersigned Registrants hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of a
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act 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 that time shall be
deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of each
undersigned Registrant pursuant to the provisions, or otherwise, each
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
undersigned Registrant of expenses incurred or paid by a director, officer of
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
II-2
<PAGE>
indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
Each of the undersigned Registrants hereby undertakes:
(1) For purposes of determining any liability under the Securities Act,
the information omitted from the form of prospectus filed as part of a
registration statement in reliance upon Rule 430A and contained in the form
of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act, 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.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, the Corporation
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this amendment no. 1
to the registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Boston, and Commonwealth of
Massachusetts, on the 29th day of May, 1997.
BANKBOSTON CORPORATION
/s/ Gary A. Spiess
By___________________________________
(Gary A. Spiess)
(General Counsel and Clerk)
Pursuant to the requirements of the Securities Act of 1933, this amendment
no. 1 to the Registration Statement has been signed by the following persons
in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ Charles K. Gifford* Chief Executive Officer and May 29, 1997
____________________________________ Director (Chief Executive
(Charles K. Gifford) Officer)
/s/ William M. Crozier, Jr.* Chairman of the Board of May 29, 1997
____________________________________ Directors and Director
(William M. Crozier, Jr.)
/s/ Henrique de Campos Meirelles* President and Chief May 29, 1997
____________________________________ Operating Officer and
(Henrique de Campos Meirelles) Director
/s/ William J. Shea* Vice Chairman, Chief May 29, 1997
____________________________________ Financial Officer and
(William J. Shea) Treasurer (Chief Financial
Officer)
/s/ Robert T. Jefferson* Comptroller (Chief May 29, 1997
____________________________________ Accounting Officer)
(Robert T. Jefferson)
/s/ Wayne A. Budd* Director May 29, 1997
____________________________________
(Wayne A. Budd)
/s/ John A. Cervieri Jr.* Director May 29, 1997
____________________________________
(John A. Cervieri Jr.)
/s/ William F. Connell* Director May 29, 1997
____________________________________
(William F. Connell)
/s/ Gary L. Countryman* Director May 29, 1997
____________________________________
(Gary L. Countryman)
/s/ Alice F. Emerson* Director May 29, 1997
____________________________________
(Alice F. Emerson)
</TABLE>
II-4
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ Thomas J. May* Director May 29, 1997
____________________________________
(Thomas J. May)
/s/ Donald F. McHenry* Director May 29, 1997
____________________________________
(Donald F. McHenry)
/s/ Paul C. O'Brien* Director May 29, 1997
____________________________________
(Paul C. O'Brien)
/s/ Thomas R. Piper* Director May 29, 1997
____________________________________
(Thomas R. Piper)
/s/ Francene S. Rodgers* Director May 29, 1997
____________________________________
(Francene S. Rodgers)
/s/ John W. Rowe* Director May 29, 1997
____________________________________
(John W. Rowe)
/s/ Glenn P. Strehle* Director May 29, 1997
____________________________________
(Glenn P. Strehle)
/s/ William C. Van Faasen* Director May 29, 1997
____________________________________
(William C. Van Faasen)
/s/ Thomas B. Wheeler* Director May 29, 1997
____________________________________
(Thomas B. Wheeler)
Director May , 1997
____________________________________
(Alfred M. Zeien)
</TABLE>
/s/ Gary A. Spiess
*By: __________________________
ATTORNEY-IN-FACT
II-5
<PAGE>
Pursuant to the requirements of the Securities Act, the Trust 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 amendment no. 1 to the
registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Boston, and Commonwealth of
Massachusetts, on the 29th day of May, 1997.
BANKBOSTON CAPITAL TRUST III
/s/ Robert T. Jefferson
By:__________________________________
Robert T. Jefferson,
as Administrative Trustee
/s/ Craig V. Starble
By: _________________________________
Craig V. Starble,
as Administrative Trustee
/s/ Kathleen M. McGillycuddy
By: _________________________________
Kathleen M. McGillycuddy,
as Administrative Trustee
II-6
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
PAGE
EXHIBIT NO. DESCRIPTION
----------- -----------
<C> <S>
1 --Form of Purchase Agreement+
4.1 --Form of Indenture of BankBoston Corporation relating to the
Junior Subordinated Debentures+
4.2 --Form of Junior Subordinated Debenture (included as Exhibit A to
Exhibit 4.1)+
4.3 --Certificate of Trust of BankBoston Capital Trust III*
4.4 --Declaration of Trust of BankBoston Capital Trust III*
4.5 --Form of Amended and Restated Declaration of Trust for BankBoston
Capital Trust III+
4.6 --Form of Capital Security Certificate for BankBoston Capital
Trust III (included as Exhibit D to Exhibit 4.5)+
4.7 --Form of Guarantee of BankBoston Corporation relating to the
Capital Securities+
5.1 --Opinion and consent of Brown & Wood LLP, special counsel to
BankBoston Corporation as to legality of the Junior Subordinated
Debentures and the Guarantee to be issued by BankBoston
Corporation+
5.2 --Opinion of Skadden, Arps, Slate, Meagher & Flom LLP, special
Delaware counsel to BankBoston Capital Trust III, as to legality
of the Capital Securities to be issued by BankBoston Capital
Trust III+
8 --Opinion of Brown & Wood LLP, special tax counsel, as to certain
federal income tax matters+
12.1 --Computation of ratio of earnings to fixed charges (excluding
interest on deposits), filed as Exhibit 12.1 to the Corporation's
Quarterly Report on Form 10-Q for the quarter ended March 31,
1997 and incorporated herein by reference.
12.2 --Computation of ratio of earnings to fixed charges (including
interest on deposits), filed as Exhibit 12.2 to the Corporation's
Quarterly Report on Form 10-Q for the quarter ended March 31,
1997 and incorporated herein by reference.
23.1 --Consent of Coopers & Lybrand L.L.P.*
23.2 --Consent of Brown & Wood LLP (included in Exhibit 5.1)+
23.3 --Consent of Skadden, Arps, Slate, Meagher & Flom (Delaware)
(included in Exhibit 5.2)+
24 --Power of Attorney of certain officers and directors of
BankBoston Corporation*
25.1 --Form T-1 Statement of Eligibility of The Bank of New York to act
as trustee under the Indenture+
25.2 --Form T-1 Statement of Eligibility of The Bank of New York to act
as trustee under the Amended and Restated Declaration of Trust of
BankBoston Capital Trust III+
25.3 --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
Capital Securities of BankBoston Capital Trust III+
</TABLE>
- --------
* Previously filed.
+ Filed herewith.
<PAGE>
EXHIBIT 1
BANKBOSTON CAPITAL TRUST III
(a Delaware business trust)
Floating Rate Capital Securities
(Liquidation Amount of $1,000 Per Capital Security)
PURCHASE AGREEMENT
Dated: ___________ , 1997
<PAGE>
Draft of May 28, 1997
BANKBOSTON CAPITAL TRUST III
(a Delaware business trust)
$250,000,000
Floating Rate Capital Securities
(Liquidation Amount of $1,000 Per Capital Security)
PURCHASE AGREEMENT
_______, 1997
MORGAN STANLEY & CO. INCORPORATED
CS FIRST BOSTON CORPORATION
LEHMAN BROTHERS INC.
SALOMON BROTHERS INC
as Representatives of the several Underwriters
c/o Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Ladies and Gentlemen:
BANKBOSTON CAPITAL TRUST III (the "Trust"), a statutory
business trust organized under the Business Trust Act (the
"Delaware Act") of the State of Delaware (Chapter 38, Title 12,
of the Delaware Code, 12 Del. (Sections 3801 et seq.)) and
BANKBOSTON CORPORATION, a Massachusetts corporation (the
"Company" and together with the Trust, the "Offerors"), confirm
their agreement (the "Agreement") with Morgan Stanley & Co.
Incorporated ("Morgan Stanley") and each of the other
Underwriters named in Schedule A hereto (collectively, the
"Underwriters", which term shall also include any underwriter
substituted as hereinafter provided in Section 10 hereof), for
whom Morgan Stanley, CS First Boston Corporation, Lehman Brothers
Inc. and Salomon Brothers Inc are acting as representatives (in
such capacity, the "Representatives"), with respect to the issue
and sale by the Trust and the purchase by the Underwriters,
acting severally and not jointly, of the respective number of
Floating Rate Capital Securities (liquidation amount of $1,000
per capital security) of the Trust (the "Capital Securities") set
forth in said Schedule A. The Capital Securities will be
guaranteed by the Company, to the extent described in the
Prospectus (as defined below), with respect to distributions and
payments upon liquidation, redemption and
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otherwise (the "Capital Securities Guarantee") pursuant to the Capital
Securities Guarantee Agreement, to be dated as of _______, 1997 (the
"Capital Securities Guarantee Agreement"), between the Company and The Bank
of New York, as Trustee (the "Guarantee Trustee"). The Capital Securities
issued in book-entry form will be issued to Cede & Co. as nominee of The
Depository Trust Company ("DTC") pursuant to a letter agreement, to be
dated as of the Closing Time (as defined in Section 2(b)) (the "DTC
Agreement"), among the Trust, the Guarantee Trustee and DTC.
The Offerors understand that the Underwriters propose to
make a public offering of the Capital Securities as soon as the
Representatives deem advisable after this Agreement has been
executed and delivered and the Declaration (as defined herein),
the Indenture (as defined herein) and the Capital Securities
Guarantee Agreement have been qualified under the Trust Indenture
Act of 1939, as amended (the "1939 Act").
The entire proceeds from the sale of the Capital Securities
will be combined with the entire proceeds from the sale by the
Trust to the Company of its common securities (the "Common
Securities") , as guaranteed by the Company, to the extent set
forth in the Prospectus, with respect to distributions and
payments upon liquidation, redemption and otherwise (the "Common
Securities Guarantee" and, together with the Capital Securities
Guarantee, the "Guarantees") pursuant to the Common Securities
Guarantee Agreement, to be dated as of _______, 1997 (the "Common
Securities Guarantee Agreement" and, together with the Capital
Securities Guarantee Agreement, the "Guarantee Agreements"), made
by the Company, and will be used by the Trust to purchase
$257,732,000 aggregate principal amount of Floating Rate Junior
Subordinated Deferrable Interest Debentures due _______, 2027
(the "Subordinated Debentures") to be issued by the Company. The
Capital Securities and the Common Securities will be issued
pursuant to the Amended and Restated Declaration of Trust of the
Trust, to be dated as of _______, 1997 (the "Declaration"), among
the Company, as sponsor, Robert T. Jefferson, Kathleen M.
McGillycuddy and Craig V. Starble, as administrative trustees
(the "Administrative Trustees"), The Bank of New York, as
property trustee (the "Property Trustee"), and The Bank of New
York (Delaware), as Delaware trustee (the "Delaware Trustee,"
and, together with the Property Trustee and the Administrative
Trustees, the "Trustees"). The Subordinated Debentures will be
issued pursuant to an indenture, to be dated as of _______, 1997
(the "Indenture"), between the Company and The Bank of New York,
as trustee (the "Debenture Trustee").
The Capital Securities, the Capital Securities Guarantee and
the Subordinated Debentures are hereinafter collectively referred
to as the "Securities." The Indenture, the Declaration, the DTC
Agreement and this Agreement are hereinafter referred to
collectively as the "Operative Documents."
The Offerors have filed with the Securities and Exchange
Commission (the "Commission") a registration statement on
Form S-3 (No. 333-27229) covering the registration of the
Securities under the Securities Act of 1933, as amended (the
"1933 Act"), including the related preliminary prospectus or
prospectuses. Promptly after execution and delivery of this
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Agreement, the Offerors will either (i) prepare and file a
prospectus in accordance with the provisions of Rule 430A ("Rule
430A") of the rules and regulations of the Commission under the
1933 Act (the "1933 Act Regulations") and paragraph (b) of Rule
424 ("Rule 424(b)") of the 1933 Act Regulations or (ii) if the
Offerors have elected to rely upon Rule 434 ("Rule 434") of the
1933 Act Regulations, prepare and file a term sheet (a "Term
Sheet") in accordance with the provisions of Rule 434 and Rule
424(b). The information included in such prospectus or in such
Term Sheet, as the case may be, that was omitted from such
registration statement at the time it became effective but that
is deemed to be part of such registration statement at the time
it became effective (i) pursuant to paragraph (b) of Rule 430A is
referred to as "Rule 430A Information" or (ii) pursuant to
paragraph (d) of Rule 434 is referred to as "Rule 434
Information." Each prospectus used before such registration
statement became effective, and any prospectus that omitted, as
applicable, the Rule 430A Information or the Rule 434
Information, that was used after such effectiveness and prior to
the execution and delivery of this Agreement, is herein called a
"preliminary prospectus." Such registration statement, including
the exhibits thereto, the schedules thereto, if any, and the
documents incorporated by reference therein pursuant to Item 12
of Form S-3 under the 1933 Act, at the time it became effective
and including the Rule 430A Information and the Rule 434
Information, as applicable, is herein called the "Registration
Statement." Any registration statement filed pursuant to Rule
462(b) of the 1933 Act Regulations is herein referred to as the
"Rule 462(b) Registration Statement," and after such filing the
term "Registration Statement" shall include the Rule 462(b)
Registration Statement. The final prospectus, including the
documents incorporated by reference therein pursuant to Item 12
of Form S-3 under the 1933 Act, in the form first furnished to
the Underwriters for use in connection with the offering of the
Securities, is herein called the "Prospectus." If Rule 434 is
relied on, the term "Prospectus" shall refer to the preliminary
prospectus and the Term Sheet, and all references in this
Agreement to the date of the Prospectus shall mean the date of
the Term Sheet. For purposes of this Agreement, all references
to the Registration Statement, any preliminary prospectus, the
Prospectus or any Term Sheet or any amendment or supplement to
any of the foregoing shall be deemed to include the copy filed
with the Commission pursuant to its Electronic Data Gathering,
Analysis and Retrieval system ("EDGAR").
All references in this Agreement to financial statements and
schedules and other information which is "contained," "included"
or "stated" in the Registration Statement, any preliminary
prospectus or the Prospectus (or other references of like import)
shall be deemed to mean and include all such financial statements
and schedules and other information which are incorporated by
reference in the Registration Statement, any preliminary
prospectus or the Prospectus, as the case may be; and all
references in this Agreement to amendments or supplements to the
Registration Statement, any preliminary prospectus or the
Prospectus shall be deemed to mean and include the filing of any
document under the Securities Exchange Act of 1934, as amended
(the "1934 Act"), which is incorporated by reference in the
Registration Statement, such preliminary prospectus or the
Prospectus, as the case may be.
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SECTION 1. Representations and Warranties.
(a) The Offerors jointly and severally represent and
warrant to each Underwriter as of the date hereof and as of the
Closing Time, and agree with each Underwriter as follows:
(i) The Company meets the requirements for use of
Form S-3 under the 1933 Act. Each of the Registration
Statement and any Rule 462(b) Registration Statement has
become effective under the 1933 Act and no stop order
suspending the effectiveness of the Registration Statement
or any Rule 462(b) Registration Statement has been issued
under the 1933 Act and no proceedings for that purpose have
been instituted or are pending or, to the knowledge of the
Company, are contemplated by the Commission, and any request
on the part of the Commission for additional information has
been complied with.
At the respective times the Registration Statement, any
Rule 462(b) Registration Statement and any post-effective
amendments thereto became effective and at the Closing Time,
the Registration Statement, the Rule 462(b) Registration
Statement and any amendments thereto complied and will
comply in all material respects with the requirements of the
1933 Act and the 1933 Act Regulations and the 1939 Act and
the rules and regulations of the Commission under the 1939
Act (the "1939 Act Regulations"), and did not and will 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 not misleading.
Neither the Prospectus nor any amendments or supplements
thereto, at the time the Prospectus or any such amendment or
supplement was issued and at the Closing Time, included or
will include 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.
If Rule 434 is used, the Company will comply with the
requirements of Rule 434. The representations and
warranties in this subsection shall not apply to statements
in or omissions from the Registration Statement (or any
amendments thereto) or Prospectus (or any amendments or
supplements thereto) made in reliance upon and in conformity
with information furnished to the Offerors in writing by any
Underwriter through Morgan Stanley expressly for use in the
Registration Statement (or any amendments thereto) or
Prospectus (or any amendments or supplements thereto).
Any preliminary prospectus and the prospectus filed as
part of the Registration Statement as originally filed or as
part of any amendment thereto, or filed pursuant to Rule 424
under the 1933 Act, complied when so filed in all material
respects with the 1933 Act Regulations and any preliminary
prospectus and the Prospectus delivered to the Underwriters
for use in connection with this offering was identical to
the electronically transmitted copies thereof filed with the
Commission pursuant to EDGAR, except to the extent permitted
by Regulation S-T.
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(ii) The documents incorporated or deemed to be
incorporated by reference in the Registration Statement and
the Prospectus, at the time they were or hereafter are filed
with the Commission, complied and will comply in all
material respects with the requirements of the 1934 Act and
the rules and regulations of the Commission thereunder (the
"1934 Act Regulations"), and, when read together with the
other information in the Prospectus, at the time the
Registration Statement became effective, at the time the
Prospectus was issued and at the Closing Time, did not and
will 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.
(iii) The accountants who certified certain
financial statements and supporting schedules included in
the Registration Statement are independent public
accountants as required by the 1933 Act and the 1933 Act
Regulations.
(iv) The consolidated financial statements,
together with the related schedules and notes, included in
the Registration Statement and the Prospectus present fairly
the consolidated financial position of the Company and its
subsidiaries at the dates indicated and the consolidated
results of operations, stockholders' equity and cash flows
of the Company and its subsidiaries for the periods
specified; said financial statements have been prepared in
conformity with generally accepted accounting principles
("GAAP") applied on a consistent basis throughout the
periods involved, except as disclosed in the notes to such
financial statements. The supporting schedules, if any,
included in the Registration Statement present fairly the
information required to be stated therein. The summary
financial data included in the Prospectus present fairly the
information shown therein and have been compiled on a basis
consistent with that of the audited financial statements
included in the Registration Statement.
(v) Since the respective dates as of which
information is given in the Registration Statement and the
Prospectus, except as otherwise stated therein or
contemplated thereby and, except for normal recurring
dividends on the capital stock of the Company, there has not
been (A) any material adverse change in the condition
(financial or otherwise), earnings, business affairs or
business prospects of the Trust, or of the Company and its
subsidiaries, considered as one enterprise, whether or not
arising in the ordinary course of business, (B) any
transaction entered into by the Trust, the Company or any
subsidiary, other than in the ordinary course of business,
that is material to the Trust, or to the Company and its
subsidiaries, considered as one enterprise, or (C) any
dividend or distribution of any kind declared, paid or made
by the Company on its capital stock.
(vi) The Company is a corporation duly organized,
validly existing and in good standing under the laws of the
Commonwealth of Massachusetts and has the corporate power
and authority under such laws to own, lease and operate its
properties and to conduct its business as described in the
Prospectus; the Company is duly
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registered as a bank holding company under the Bank Holding Company
Act of 1956, as amended; and the Company is duly qualified as a
foreign corporation to transact business and is in good standing in
each jurisdiction in which it owns or leases property of a nature, or
transacts business of a type, that would make such qualification
necessary, except to the extent that the failure to so qualify or be
in good standing would not have a material adverse effect on the
Company and its subsidiaries, considered as one enterprise.
(vii) Each of BankBoston, N.A. ("BankBoston") and
Rhode Island Hospital Trust National Bank ("Hospital Trust")
is a duly organized and validly existing national banking
association under the laws of the United States, continues
to hold a valid certificate to do business as such and has
full power and authority to conduct its business as such;
Bank of Boston Connecticut is a duly organized and validly
existing state-chartered savings bank under the laws of the
State of Connecticut, continues to hold a valid certificate
to do business as such and has full power and authority to
conduct its business as such (BankBoston, Hospital Trust and
Bank of Boston Connecticut are referred to collectively as
the "Significant Subsidiaries"); each Significant Subsidiary
has the authority under its jurisdiction of organization to
own, lease and operate its properties and to conduct its
business and is duly authorized to transact business and is
in good standing in each jurisdiction in which it owns or
leases property of a nature, or transacts business of a
type, that would make such qualification necessary, except
to the extent that the failure to so qualify or to be in
good standing would not have a material adverse effect on
the Company and its subsidiaries, considered as one
enterprise.
(viii) The Company does not have any
subsidiaries which are material to its business, except to
the extent that one or more of the Significant Subsidiaries
may be deemed to be so material.
(ix) (a) The Company had at the date indicated a
duly authorized and outstanding capitalization as set forth
in the Prospectus, (b) all of the outstanding shares of
capital stock of the Company have been duly authorized and
validly issued and are fully paid and non-assessable, and
(c) none of the outstanding shares of capital stock of the
Company was issued in violation of the preemptive rights of
any stockholder of the Company.
(x) The Trust has been duly created 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
Prospectus and to enter into and perform its obligations
under the Operative Documents, as applicable, and the
Capital Securities; the Trust is not a party to or otherwise
bound by any material agreement other than those described
in the Prospectus; and the Trust is and will, under current
law, be classified for United States federal income tax
purposes as a grantor trust and not as an association
taxable as a corporation.
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(xi) The Common Securities have been duly
authorized by the Declaration and, when issued and delivered
by the Trust to the Company against payment therefor as
described in the Prospectus, will be validly issued and will
represent undivided beneficial interests in the assets of
the Trust; 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 Trust will be directly owned by the
Company free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equitable right.
(xii) As of the Closing Time, the Capital
Securities will have been duly authorized by the Trust and,
when issued and delivered against payment therefor as
provided herein, will be validly issued and fully paid and
non-assessable undivided beneficial interests in the assets
of the Trust and will conform in all material respects to
the description thereof contained in the Prospectus and the
issuance of the Capital Securities will not be subject to
preemptive or other similar rights.
(xiii) This Agreement has been duly authorized,
executed and delivered by the Offerors.
(xiv) The Declaration has been qualified under
the 1939 Act and has been duly authorized by the Company
and, at the Closing Time, will have been duly executed and
delivered by the Company and the Trustees, and assuming due
authorization, execution and delivery of the Declaration by
the Trustees, the Declaration will, at the Closing Time, be
a valid and binding obligation of the Company, enforceable
against the Company in accordance with its terms, except to
the extent that enforcement thereof may be limited by the
receivership, conservatorship and supervisory powers of bank
regulatory agencies generally as well as to bankruptcy,
insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally or by general
principles of equity (regardless of whether enforcement is
considered in a proceeding at law or in equity) and the
availability of equitable remedies (collectively, the
"Enforceability Exceptions").
(xv) The Capital Securities Guarantee Agreement
has been qualified under the 1939 Act; each of the Guarantee
Agreements has been duly authorized by the Company and, at
the Closing Time, will have been duly executed and delivered
by the Company and will constitute a valid and binding
obligation of the Company, enforceable against the Company
in accordance with its terms, except to the extent that
enforcement thereof may be limited by the Enforceability
Exceptions.
(xvi) The Indenture has been qualified under
the 1939 Act and has been duly authorized by the Company
and, at the Closing Time, will have been duly executed and
delivered by the Company and will constitute a valid and
binding agreement of the Company, enforceable against the
Company in accordance with its terms except to the extent
that enforcement thereof may be limited by the
Enforceability Exceptions.
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(xvii) The Subordinated Debentures have been
duly authorized by the Company and, at the Closing Time,
will have been duly executed by the Company and, when
authenticated in the manner provided for in the Indenture
and delivered against payment therefor as described in the
Prospectus, will constitute valid and binding obligations of
the Company, enforceable against the Company in accordance
with their terms except to the extent that enforcement
thereof may be limited by the Enforceability Exceptions; and
the Subordinated Debentures will be in the form contemplated
by, and entitled to the benefits of, the Indenture and will
conform in all material respects to the description thereof
in the Prospectus.
(xviii) Each of the Administrative Trustees of
the Trust is an officer of the Company or BankBoston and has
been duly authorized by the Company to execute and deliver
the Declaration.
(xix) The Trust is not, and following
consummation of the transactions contemplated hereby will
not be, an "investment company" or a company "controlled" by
an "investment company" which is required to be registered
under the Investment Company Act of 1940, as amended (the
"1940 Act").
(xx) The Operative Documents conform in all
material respects to the summary descriptions thereof
contained in the Prospectus.
(xxi) None of the Trust, the Company nor any
Significant Subsidiary is in default in the performance or
observance of any obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage,
loan 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, except for such
defaults that would not have a material adverse effect on
the condition (financial or otherwise), earnings, business
affairs or business prospects of the Company and its
subsidiaries, considered as one enterprise; the execution
and delivery of the Operative Documents by the Trust or the
Company, as the case may be, the issuance and delivery of
the Securities, the consummation by the Offerors of the
transactions contemplated in the Operative Documents, and
compliance by the Offerors with the terms of the Operative
Documents to which they are party have been duly authorized
by all necessary corporate action on the part of the Company
and, as at the Closing Time, will have been duly authorized
by all necessary action on the part of the Trust, and do not
and will not result in any violation of the charter or by-
laws of the Company or any Significant Subsidiary or the
Declaration or the trust certificate of the Trust filed with
the State of Delaware on May 14, 1997 (the "Trust
Certificate"), and do not and will not conflict with, or
result in a breach of any of the terms or provisions of, or
constitute a default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any
property of assets of the Trust, the Company or any
Significant Subsidiary under (A) any indenture, mortgage,
loan agreement, note, lease or other agreement or instrument
to which the Trust, the Company or any Significant
Subsidiary is a party or by which it may be bound
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or to which any of its properties may be subject, except
for such conflicts, breaches or defaults or liens, charges
or encumbrances that would not have a material adverse effect
on the condition (financial or otherwise), earnings,
business affairs or business prospects of the Trust, or the
Company and its subsidiaries considered as one enterprise or
(B) any existing applicable law, rule, regulation, judgment,
order or decree of any government, governmental
instrumentality or court, domestic or foreign, having
jurisdiction over the Trust, the Company or any Significant
Subsidiary or any of its properties.
(xxii) No filing with, or authorization,
approval, consent, license, order, registration,
qualification or decree of, any court or governmental
authority or agency, other than those that have been made or
obtained, is necessary or required for the performance by
the Company or the Trust of their obligations hereunder, in
connection with the issuance and sale of the Capital
Securities or the consummation of the transactions
contemplated by the Operative Documents, except as have been
previously made or obtained.
(xxiii) To the best knowledge of the Offerors,
no labor problem exists with employees of the Significant
Subsidiaries or is imminent that could adversely affect the
Trust, or the Company and its subsidiaries considered as one
enterprise, and the Offerors are not aware of any existing
or imminent labor disturbance by the employees of any of its
or the Significant Subsidiaries' principal suppliers,
contractors or customers that could be expected to
materially adversely affect the condition (financial or
otherwise), earnings, business affairs or business prospects
of the Trust, or the Company and its subsidiaries considered
as one enterprise.
(xxiv) Except as disclosed in the Registration
Statement, 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 or the Trust, threatened against or affecting the
Trust, or the Company or any Significant Subsidiary that is
required to be disclosed in the Registration Statement or
that, in the final outcome, could, in the judgment of the
Company, result in any material adverse change in the
condition (financial or otherwise), earnings, business
affairs or business prospects of the Trust, or the Company
and its subsidiaries considered as one enterprise, or that
could materially and adversely affect the properties or
assets of the Trust, or the Company and its subsidiaries
considered as one enterprise, or that could adversely affect
the consummation of the transactions contemplated in the
Operative Documents; the aggregate liability or loss, if
any, resulting from the final outcome of all pending legal
or governmental proceedings to which the Trust, the Company
or any Significant Subsidiary is a party or which affect any
of its properties that are not described in the Registration
Statement, including ordinary routine litigation incidental
to its business, would not have a material adverse effect on
the condition (financial or otherwise), earnings, business
affairs or business prospects of the Trust, or the Company
and its subsidiaries considered as one enterprise.
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(xxv) There are no contracts or documents
which are required to be described in the Registration
Statement, the Prospectus or the documents incorporated by
reference therein or to be filed as exhibits thereto which
have not been so described or filed as required.
(xxvi) The Offerors and the Significant
Subsidiaries each owns or possesses, or can acquire on
reasonable terms, adequate patents, patent licenses,
trademarks, service marks and trade names necessary to carry
on their businesses as presently conducted, and neither the
Offerors nor any of the Significant Subsidiaries has
received any notice of infringement of or conflict with
asserted rights of others with respect to any patents,
patent licenses, trademarks, service marks or trade names
that, in the aggregate, if the subject of an unfavorable
decision, ruling or finding, could materially adversely
affect the condition (financial or otherwise), earnings,
business affairs or business prospects of the Trust, or the
Company and its subsidiaries considered as one enterprise.
(xxvii) The Offerors and the Significant
Subsidiaries each owns, possesses or has obtained all
material governmental licenses, permits, certificates,
consents, orders, approvals and other authorizations
necessary to own or lease, as the case may be, and to
operate its properties and to carry on its business as
presently conducted, and neither the Offerors nor any
Significant Subsidiary has received any notice of
proceedings relating to revocation or modification of any
such licenses, permits, certificates, consents, orders,
approvals or authorizations that, in the aggregate, if the
subject of an unfavorable decision, ruling or finding, could
materially adversely affect the condition (financial or
otherwise), earnings, business affairs or business prospects
of the Trust, or the Company and its subsidiaries considered
as one enterprise.
(xxviii) The Offerors and the Significant
Subsidiaries each has good and marketable title to all
properties and assets described in the Prospectus as owned
by it, free and clear of all liens, charges, encumbrances or
restrictions, except such as (A) are described in the
Prospectus or (B) are neither material in amount nor
materially significant in relation to the business of the
Trust, or the Company and its subsidiaries considered as one
enterprise; and all of the leases and subleases material to
the business of the Trust, and the Company and its
subsidiaries considered as one enterprise, and under which
the Offerors or any Significant Subsidiary holds properties
described in the Prospectus, are in full force and effect,
and neither the Offerors nor any Significant Subsidiary has
any notice of any material claim of any sort that has been
asserted by anyone adverse to the rights of the Offerors or
any Significant Subsidiary under any of the leases or
subleases mentioned above, or affecting or questioning the
rights of such corporation to the continued possession of
the leased or subleased premises under any such lease or
sublease.
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(xxix) The Company has not taken and will not
take, directly or indirectly, any action designed to, or
that might be reasonably expected to, cause or result in
stabilization or manipulation of the price of the
Securities.
(b) Any certificate signed by any Trustee of the Trust or
any duly authorized officer of the Company or any Significant
Subsidiary and delivered to the Representatives or to counsel for
the Underwriters shall be deemed a representation and warranty by
the Trust or the Company, as the case may be, to each Underwriter
as to the matters covered thereby.
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) On the basis of the representations and warranties
herein contained and subject to the terms and conditions herein
set forth, the Trust agrees to sell to each Underwriter,
severally and not jointly, and each Underwriter, severally and
not jointly, agrees to purchase from the Trust, at the price per
Capital Security set forth in Schedule B, the number of Capital
Securities set forth in Schedule A opposite the name of such
Underwriter, plus any additional number of Capital Securities
which such Underwriter may become obligated to purchase pursuant
to the provisions of Section 10 hereof.
(b) Payment of the purchase price for, and delivery of
certificates for, the Capital Securities shall be made at the
offices of Skadden, Arps, Slate, Meagher & Flom LLP, 919 Third
Avenue, New York, New York 10022, or at such other place as
shall be agreed upon by the Representatives and the Offerors, at
10:00 A.M. (Eastern time) on the third (fourth, if the pricing
occurs after 4:30 P.M. (Eastern time) on any given day) business
day after the date hereof (unless postponed in accordance with
the provisions of Section 10), or such other time not later than
ten business days after such date as shall be agreed upon by the
Representatives and the Offerors (such time and date of payment
and delivery being herein called "Closing Time").
Payment shall be made to the Trust by wire transfer of
immediately available funds to a bank account designated by the
Trust against delivery to the Representatives for the respective
accounts of the Underwriters of certificates for the Capital
Securities to be purchased by them. It is understood that each
Underwriter has authorized the Representatives, for its account,
to accept delivery of, receipt for, and make payment of the
purchase price for, the Capital Securities which it has agreed to
purchase. Morgan Stanley, individually and not as representative
of the Underwriters, may (but shall not be obligated to) make
payment of the purchase price for the Capital Securities to be
purchased by any Underwriter whose funds have not been received
by the Closing Time, but such payment shall not relieve such
Underwriter from its obligations hereunder.
(c) Certificates for the Capital Securities shall be in
such denominations and registered in such names as the
Representatives may request in writing at least one full business
day before the Closing Time. The Securities will be made
available for examination and
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packaging by the Representatives in The City of New York not
later than 10:00 A.M. (Eastern time) on the business day prior
to the Closing Time.
(d) As compensation to the Underwriters for their
commitments hereunder and in view of the fact that the proceeds
of the sale of the Capital Securities will be used to purchase
Subordinated Debentures of the Company, the Company hereby agrees
to pay at the Closing Time to Morgan Stanley in immediately
available funds, for the accounts of the several Underwriters, a
commission per Capital Security to be delivered by the Trust
hereunder at the Closing Time as set forth in Schedule B.
SECTION 3. Covenants of the Offerors. The Offerors
covenant with each Underwriter as follows:
(a) The Offerors, subject to Section 3(b) hereof, will
comply with the requirements of Rule 430A or Rule 434, as
applicable, and will notify the Representatives immediately, and
confirm the notice in writing, (i) when any post-effective
amendment to the Registration Statement shall become effective,
or any supplement to the Prospectus or any amended Prospectus
shall have been filed, (ii) of the receipt of any comments from
the Commission, (iii) of any request by the Commission for any
amendment to the Registration Statement or any amendment or
supplement to the Prospectus or for additional information, and
(iv) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or of
any order preventing or suspending the use of any preliminary
prospectus, or of the suspension of the qualification of the
Securities for offering or sale in any jurisdiction, or of the
initiation or threatening of any proceedings for any of such
purposes. The Offerors will promptly effect the filings
necessary pursuant to Rule 424(b) and will take such steps as it
deems necessary to ascertain promptly whether the form of
prospectus transmitted for filing under Rule 424(b) was received
for filing by the Commission and, in the event that it was not,
it will promptly file such prospectus. The Offerors will make
every reasonable effort to prevent the issuance of any stop order
and, if any stop order is issued, to obtain the lifting thereof
at the earliest possible moment.
(b) The Offerors will give the Representatives notice of
its intention to file or prepare any amendment to the
Registration Statement (including any filing under Rule 462(b)),
any Term Sheet or any amendment, supplement or revision to either
the prospectus included in the Registration Statement at the time
it became effective or to the Prospectus, whether pursuant to the
1933 Act, the 1934 Act or otherwise, will furnish the
Representatives with copies of any such documents a reasonable
amount of time prior to such proposed filing or use, as the case
may be, and will not file or use any such document without the
consent of the Representatives, which consent shall not be
unreasonably withheld.
(c) The Offerors have furnished or will deliver to the
Representatives and counsel for the Underwriters, without charge,
signed copies of the Registration Statement as originally filed
and of each amendment thereto (including exhibits filed therewith
or incorporated by reference therein and documents incorporated
or deemed to be incorporated by reference therein) and
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signed copies of all consents and certificates of experts, and will
also deliver to the Representatives, without charge, a conformed copy
of the Registration Statement as originally filed and of each
amendment thereto (without exhibits) for each of the
Underwriters. The copies of the Registration Statement and each
amendment thereto furnished to the Underwriters will be identical
to the electronically transmitted copies thereof filed with the
Commission pursuant to EDGAR, except to the extent permitted by
Regulation S-T.
(d) The Offerors will furnish to each Underwriter, without
charge, during the period when the Prospectus is required to be
delivered under the 1933 Act or the 1934 Act, such number of
copies of the Prospectus (as amended or supplemented) as such
Underwriter may reasonably request. The Prospectus and any
amendments or supplements thereto furnished to the Underwriters
will be identical to the electronically transmitted copies
thereof filed with the Commission pursuant to EDGAR, except to
the extent permitted by Regulation S-T.
(e) The Offerors will comply with the 1933 Act, the 1933
Act Regulations, the 1934 Act, the 1934 Act Regulations, the 1939
Act and the 1939 Act Regulations so as to permit the completion
of the distribution of the Capital Securities as contemplated in
this Agreement and in the Prospectus. If at any time when a
prospectus is required by the 1933 Act to be delivered in
connection with sales of the Capital Securities, any event shall
occur or condition shall exist as a result of which it is
necessary, in the reasonable opinion of counsel for the
Underwriters or for the Offerors, to amend the Registration
Statement or amend or supplement the Prospectus in order that the
Prospectus will not include any untrue statement of a material
fact or omit to state a material fact necessary in order to make
the statements therein not misleading in the light of the
circumstances existing at the time it is delivered to a
purchaser, or if it shall be necessary, in the opinion of such
counsel, at any such time to amend the Registration Statement or
amend or supplement the Prospectus in order to comply with the
requirements of the 1933 Act or the 1933 Act Regulations, the
Offerors will promptly prepare and file with the Commission,
subject to Section 3(b), such amendment or supplement as may be
necessary to correct such statement or omission or to make the
Registration Statement or the Prospectus comply with such
requirements, and the Offerors will furnish to the Underwriters
such number of copies of such amendment or supplement as the
Underwriters may reasonably request.
(f) The Offerors will use their best efforts, in
cooperation with the Underwriters, to qualify the Capital
Securities for offering and sale under the applicable securities
laws of such states and other jurisdictions as the
Representatives may designate and to maintain such qualifications
in effect for a period of not less than one year from the later
of the effective date of the Registration Statement and any Rule
462(b) Registration Statement; provided, however, that the
Offerors shall not be obligated to file any general consent to
service of process or to qualify as a foreign corporation or as a
dealer in securities in any jurisdiction in which it is not so
qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so
subject. In each jurisdiction in which the Capital Securities
have been so qualified, the Offerors will file such statements
and reports as may be required by the laws of such jurisdiction
to continue such qualification in effect for a period of not less
than one year from the effective date of the Registration
Statement and any Rule 462(b) Registration
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Statement. The Offerors will also supply the Underwriters with
such information as is necessary for the determination of the
legality of the Capital Securities for investment under the laws
of such jurisdictions as the Underwriters may request.
(g) The Company and the Trust will make generally available
to their securityholders as soon as practicable an earnings
statement for the purposes of, and to provide the benefits
contemplated by, the last paragraph of Section 11(a) of the 1933
Act.
(h) The Offerors shall take all reasonable action necessary
to enable Standard & Poor's Ratings Services, a division of
McGraw Hill, Inc. ("S&P"), and Moody's Investors Service, Inc.
("Moody's") to provide their respective credit ratings of the
Capital Securities.
(i) The Offerors will cooperate with the Underwriters and
use their best efforts to permit the Capital Securities to be
eligible for clearance and settlement through the facilities of
DTC.
(j) The Trust will use the net proceeds received by it from
the sale of the Capital Securities; and the Company will use the
proceeds received by it from the sale of the Subordinated
Debentures, in the manners specified in the Prospectus under "Use
of Proceeds".
(k) Prior to the Closing Time, neither the Trust nor the
Company will, without the prior written consent of Morgan
Stanley, directly or indirectly, issue, sell, offer or agree to
sell, grant any option for the sale of, or otherwise dispose of,
Capital Securities, any security convertible into exchangeable or
exercisable for Capital Securities or the Subordinated Debentures
or any debt securities substantially similar (including
provisions with respect to the deferral of interest) to the
Subordinated Debentures or any equity security substantially
similar to the Capital Securities (except for the Securities
issued pursuant to this Agreement).
(l) The Company, during the period when the Prospectus is
required to be delivered under the 1933 Act or the 1934 Act, will
file all documents required to be filed with the Commission
pursuant to the 1934 Act within the time periods required by the
1934 Act and the 1934 Act Regulations.
SECTION 3A. Covenants of the Underwriters. Each of the
Underwriters represents and agrees as follows:
(a) The Underwriters will comply with the provisions of
Rule 2810 of the Conduct Rules of the National Association of
Securities Dealers, Inc. (the "NASD"), including, without
limitation, Sections (b)(2)(B) and (b)(3)(D) thereof.
SECTION 4. Payment of Expenses.
(a) Expenses. The Company will pay all expenses incident
to the performance of its obligations under this Agreement,
including (i) the preparation, printing and filing of the
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Registration Statement (including financial statements and any
schedules or exhibits and any document incorporated therein by
reference) and of each amendment thereto, (ii) the preparation,
printing and delivery to the Underwriters of this Agreement, the
Operative Documents and such other documents as may be required
in connection with the offering, purchase, sale and delivery of
the Securities, (iii) the preparation, issuance and delivery of
the certificates for the Capital Securities to the Underwriters,
(iv) the fees and disbursements of the Company's counsel,
accountants and other advisors, (v) rating agency fees, (vi) the
fees and expenses of any trustee appointed under any of the
Operative Documents, including the fees and disbursements of
counsel for such trustees in connection with the Operative
Documents, (vii) the qualification of the Capital Securities
under securities laws in accordance with the provisions of
Section 3(f) hereof, including filing fees and the reasonable
fees and disbursements of counsel for the Underwriters in
connection therewith and in connection with the preparation of
the Blue Sky Survey and any supplement thereto, (viii) the
printing and delivery to the Underwriters of copies of each
preliminary prospectus, any Term Sheets and the Prospectus and
any amendments or supplements thereto, (ix) the preparation,
printing and delivery to the Underwriters of copies of the Blue
Sky Survey and any supplement thereto, (x) the filing fees
incident to, and the reasonable fees and disbursements of counsel
to the Underwriters in connection with, the review, if any, by
the NASD of the terms of the sale of the Securities, (xi) the
fees and expenses of any transfer agent or registrar for the
Securities, and (xii) the cost of qualifying the Capital
Securities with DTC.
(b) Termination of Agreement. If this Agreement is
terminated by the Representatives in accordance with the
provisions of Section 5 or Section 9(a)(i) hereof, the Company
shall reimburse the Underwriters for all of their out-of-pocket
expenses, including the reasonable fees and disbursements of
Skadden, Arps, Slate, Meagher & Flom LLP, counsel for the
Underwriters.
SECTION 5. Conditions of Underwriters' Obligations. The
obligations of the several Underwriters hereunder are subject to
the accuracy of the representations and warranties of the
Offerors contained in Section 1 hereof or in certificates of any
Trustee of the Trust, officer of the Company or any of its
subsidiaries delivered pursuant to the provisions hereof, to the
performance by the Offerors of their obligations hereunder, and
to the following further conditions:
(a) Effectiveness of Registration Statement. The
Registration Statement, including any Rule 462(b) Registration
Statement, has become effective and at Closing Time no stop order
suspending the effectiveness of the Registration Statement shall
have been issued under the 1933 Act or proceedings therefor
initiated or threatened by the Commission, and any request on the
part of the Commission for additional information shall have been
complied with to the reasonable satisfaction of counsel to the
Underwriters. A prospectus containing the Rule 430A Information
shall have been filed with the Commission in accordance with Rule
424(b) (or a post-effective amendment providing such information
shall have been filed and declared effective in accordance with
the requirements of Rule 430A) or, if the Offerors have elected
to rely upon
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Rule 434, a Term Sheet shall have been filed with the Commission
in accordance with Rule 424(b).
(b) Opinion of Outside Counsel for Offerors. At the
Closing Time, the Underwriters shall have received the favorable
opinion, dated as of the Closing Time, of Brown & Wood LLP,
counsel for the Company, in form and substance reasonably
satisfactory to counsel for the Underwriters.
(c) Opinion of General Counsel. At the Closing Time, the
Underwriters shall have received the favorable opinion, dated as
of the Closing Time, of Gary A. Spiess, General Counsel for the
Company, in form and substance reasonably satisfactory to counsel
for the Underwriters.
(d) Opinion of Special Delaware Counsel for Offerors. If
the opinion referred to in Section 5(b) does not cover applicable
matters of Delaware law, at the Closing Time, the Underwriters
shall have received the favorable opinion, dated as of the
Closing Time, of special Delaware counsel to the Offerors, in
form and substance reasonably satisfactory to counsel for the
Underwriters.
(e) Opinion of Counsel for The Bank of New York. At the
Closing Time, the Underwriters shall have received the favorable
opinion, dated as of the Closing Time, of Emmet, Marvin & Martin,
LLP, counsel to The Bank of New York, as Property Trustee under
the Declaration, and Guarantee Trustee under the Capital
Securities Guarantee Agreement, in form and substance reasonably
satisfactory to counsel for the Underwriters.
(f) Opinion of Special Tax Counsel for the Offerors. At
the Closing Time, the Underwriters shall have received an
opinion, dated as of the Closing Time, of Brown & Wood LLP,
special tax counsel to the Offerors, that (i) the Subordinated
Debentures will be classified for United States federal income
tax purposes as indebtedness of the Company, (ii) the Trust will
be classified for United States federal income tax purposes as a
grantor trust and not as an association taxable as a corporation
and (iii) although the discussion set forth in the Prospectus
under the heading "Certain Federal Income Tax Consequences" does
not purport to discuss all possible United States federal income
tax consequences of the purchase, ownership and disposition of
the Capital Securities, such discussion constitutes, in all
material respects, a fair and accurate summary of the United
States federal income tax consequences of the purchase, ownership
and disposition of the Capital Securities under current law.
Such opinion may be conditioned on, among other things, the
initial and continuing accuracy of the facts, financial and other
information, covenants and representations set forth in
certificates of officers of the Company and other documents
deemed necessary for such opinion.
(g) Opinion of Counsel for Underwriters. At the Closing
Time, the Underwriters shall have received the favorable opinion,
dated as of the Closing Time, of Skadden, Arps, Slate, Meagher &
Flom LLP, counsel for the Underwriters, with respect to the
incorporation and legal existence of the Company, the Capital
Securities, the Indenture, the Capital Securities
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Guarantee, this Agreement, the Prospectus and other related
matters as the Underwriters may require. 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
Trustees of the Trust, officers of the Company and its
subsidiaries and certificates of public officials.
(h) Certificates. At the Closing Time, there shall not
have been, since the date hereof or since the respective dates as
of which information is given in the Prospectus, any material
adverse change in the condition, financial or otherwise, or in
the earnings, business affairs or business prospects of the
Trust, or the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of
business, and the Representatives shall have received a
certificate of the Chairman, any Vice Chairman, the Chief
Executive Officer, the President or any Vice President of the
Company and of the chief financial officer, the chief accounting
officer or the Executive Director, Global Treasury of the Company
and a certificate of an Administrative Trustee of the Trust,
dated as of the Closing Time, to the effect that (i) there has
been no such material adverse change, (ii) the representations
and warranties in Section 1 hereof were true and correct when
made and are true and correct with the same force and effect as
though expressly made at and as of the Closing Time, (iii) the
Offerors have complied with all agreements and satisfied all
conditions on their part to be performed or satisfied at or prior
to the Closing Time, and (iv) no stop order suspending the
effectiveness of the Registration Statement has been issued and
no proceedings for that purpose have been instituted or are
pending or, to each such officer's knowledge, are contemplated by
the Commission.
(i) Accountant's Comfort Letter. At the time of the
execution of this Agreement, the Representatives shall have
received from Coopers & Lybrand L.L.P. a letter dated such date,
in form and substance satisfactory to the Representatives,
together with signed or reproduced copies of such letter for each
of the other Underwriters, containing statements and information
of the type ordinarily included in accountants' "comfort letters"
to underwriters with respect to the financial statements and
certain financial information contained in the Registration
Statement and the Prospectus.
(j) Bring-down Comfort Letter. At the Closing Time, the
Representatives shall have received from Coopers & Lybrand L.L.P.
a letter, dated as of the Closing Time, to the effect that they
reaffirm the statements made in the letter furnished pursuant to
subsection (i) of this Section, except that the specified date
referred to shall be a date not more than three business days
prior to the Closing Time.
(k) Maintenance of Rating. At the Closing Time, the
Capital Securities shall be rated at least baa1 by Moody's and
BBB by S&P, and the Trust shall have delivered to the
Representatives a letter dated the Closing Time, from each such
rating agency, or other evidence satisfactory to the
Representatives, confirming that the Capital Securities have such
ratings; and between the date of this Agreement and the Closing
Time, there shall not have occurred a downgrading in the rating
assigned to the Capital Securities or any of the Company's other
debt securities by any nationally recognized statistical rating
organization, and no such organization
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shall have publicly announced that it has under surveillance or
review, with possible negative implications, its rating of any of
the Capital Securities or any of the Company's other debt securities.
(l) Additional Documents. At the Closing Time, counsel for
the Underwriters shall have been furnished with such documents
and opinions as they may require for the purpose of enabling them
to pass upon the issuance and sale of the Capital Securities as
herein contemplated, or in order to evidence the accuracy of any
of the representations or warranties of the Offerors, or the
fulfillment of any of the conditions, herein contained; and all
proceedings taken by the Offerors in connection with the issuance
and sale of the Capital Securities as herein contemplated shall
be satisfactory in form and substance to the Representatives and
counsel for the Underwriters.
(m) Termination of Agreement. If any condition specified
in this Section shall not have been fulfilled when and as
required to be fulfilled, this Agreement may be terminated by the
Representatives by notice to the Offerors 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 4 and except that Sections 6, 7 and 8 shall survive any
such termination and remain in full force and effect.
SECTION 6. Indemnification.
(a) Indemnification of Underwriters. The Offerors agree to
jointly and severally indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter
within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, arising out of any
untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement (or any
amendment thereto), including the Rule 430A Information and
the Rule 434 Information, if applicable, or the omission or
alleged omission therefrom of a material fact required to be
stated therein or necessary to make the statements therein
not misleading or arising out of any untrue statement or
alleged untrue statement of a material fact contained in any
preliminary prospectus or the Prospectus (or any amendment
or supplement thereto), or the omission or alleged omission
therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under
which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, to the extent of the
aggregate amount paid in settlement of any litigation, or
any investigation or proceeding by any governmental agency
or body, commenced or threatened, or of any claim whatsoever
based upon any such untrue statement or omission, or any
such alleged untrue statement or omission; provided that
(subject to
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Section 6(d) below) any such settlement is effected with the
written consent of the Offerors; and
(iii) against any and all expense whatsoever, as
incurred (including the fees and disbursements of counsel
chosen by Morgan Stanley), reasonably incurred in
investigating, preparing or defending against any
litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any
claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission,
to the extent that any such expense is not paid under (i) or
(ii) above;
provided, however, that this indemnity agreement shall not apply
to any loss, liability, claim, damage or expense to the extent
arising out of any untrue statement or omission or alleged untrue
statement or omission made in reliance upon and in conformity
with written information furnished to the Offerors by any
Underwriter through Morgan Stanley expressly for use in the
Registration Statement (or any amendment thereto), including the
Rule 430A Information and the Rule 434 Information, if
applicable, or any preliminary prospectus or the Prospectus (or
any amendment or supplement thereto).
(b) Indemnification of Offerors, Directors and Officers.
Each Underwriter severally agrees to indemnify and hold harmless
the Offerors, their respective directors or trustees, the
Company's officers who signed the Registration Statement, and
each person, if any, who controls the Offerors within the meaning
of Section 15 of the 1933 Act or Section 20 of the 1934 Act
against any and all loss, liability, claim, damage and expense
described in the indemnity contained in subsection (a) of this
Section, as incurred, but only with respect to untrue statements
or omissions, or alleged untrue statements or omissions, made in
the Registration Statement (or any amendment thereto), including
the Rule 430A Information and the Rule 434 Information, if
applicable, or any preliminary prospectus or the Prospectus (or
any amendment or supplement thereto) in reliance upon and in
conformity with written information furnished to the Offerors by
such Underwriter through Morgan Stanley expressly for use in
Registration Statement (or any amendment thereto) or such
preliminary prospectus or the Prospectus (or any amendment or
supplement thereto).
(c) Actions against Parties; Notification. Each
indemnified party shall give notice as promptly as reasonably
practicable to each indemnifying party of any action commenced
against it in respect of which indemnity may be sought hereunder,
but failure to so notify an indemnifying party shall not relieve
such indemnifying party from any liability hereunder to the
extent it is not materially prejudiced as a result thereof and in
any event shall not relieve it from any liability which it may
have otherwise than on account of this indemnity agreement. In
the case of parties indemnified pursuant to Section 6(a) above,
counsel to the indemnified parties shall be selected by Morgan
Stanley, and, in the case of parties indemnified pursuant to
Section 6(b) above, counsel to the indemnified parties shall be
selected by the Offerors. An indemnifying party may participate
at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except
with the consent of
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the indemnified party) also be counsel to the indemnified party.
In no event shall the indemnifying parties be liable for fees
and expenses of more than one counsel (in addition to any local
counsel) separate from their own counsel for all indemnified parties
in connection with any one action or separate but similar or related
actions in the same jurisdiction arising out of the same general
allegations or circumstances. No indemnifying party shall, without
the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to
any litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever in
respect of which indemnification or contribution could be sought under
this Section 6 or Section 7 hereof (whether or not the indemnified
parties are actual or potential parties thereto), unless such
settlement, compromise or consent (i) includes an unconditional
release of each indemnified party from all liability arising out
of such litigation, investigation, proceeding or claim and (ii)
does not include a statement as to or an admission of fault,
culpability or a failure to act by or on behalf of any
indemnified party.
(d) Settlement without Consent if Failure to Reimburse.
Notwithstanding the last sentence of Section 6(c), if at any time
an indemnified party shall have requested an indemnifying party
to reimburse the indemnified party for fees and expenses of
counsel, such indemnifying party agrees that it shall be liable
for any settlement effected without its written consent if (i)
such settlement is entered into more than 45 days after receipt
by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of
such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have
reimbursed such indemnified party in accordance with such request
prior to the date of such settlement; provided that an
indemnifying party shall not be liable for any such settlement
effected without its consent if such indemnifying party (1)
reimburses such indemnified party in accordance with such request
to the extent it considers such request to be reasonable and (2)
provides written notice to the indemnified party substantiating
the unpaid balance as unreasonable, in each case prior to the
date of such settlement.
SECTION 7. Contribution. In order to provide for just
and equitable contribution in circumstances under which the
indemnification provided for in Section 6 hereof is for any
reason held to be unenforceable by an indemnified party in
respect of any losses, liabilities, claims, damages or expenses
referred to therein, then each indemnifying party shall
contribute to the aggregate amount of such losses, liabilities,
claims, damages and expenses incurred by such indemnified party,
as incurred, in such proportion as is appropriate to reflect the
relative benefits received by the Offerors on the one hand and
the Underwriters on the other hand from the offering of the
Capital Securities pursuant to this Agreement.
The relative benefits received by the Offerors on the one
hand and the Underwriters on the other hand in connection with
the offering of the Capital Securities pursuant to this Agreement
shall be deemed to be in the same respective proportions as the
total net proceeds from the offering of the Capital Securities
pursuant to this Agreement (before deducting expenses) received
by the Offerors and the total commission received by the
Underwriters, bear to the aggregate initial public offering price
of the Capital Securities.
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The Offerors and the Underwriters 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 Underwriters
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 above in this Section 7. The
aggregate amount of losses, liabilities, claims, damages and
expenses incurred by an indemnified party and referred to above
in this Section 7 shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in
investigating, preparing or defending against any litigation, or
any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon
any such untrue or alleged untrue statement or omission or
alleged omission.
Notwithstanding the provisions of this Section 7, no
Underwriter shall be required to contribute any amount in excess
of the amount by which the total price at which the Capital
Securities underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which
such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged
omission.
No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the 1933 Act) shall be entitled to
contribution from any person who was not guilty of such
fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who
controls an Underwriter within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act shall have the same rights
to contribution as such Underwriter, and each director of the
Company, each officer of the Company who signed the Registration
Statement, each trustee of the Trust and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933
Act or Section 20 of the 1934 Act shall have the same rights to
contribution as the Company. The Underwriters' respective
obligations to contribute pursuant to this Section 7 are several
in proportion to the number of Capital Securities set forth
opposite their respective names in Schedule A hereto and not
joint.
SECTION 8. Representations, Warranties and Agreements to
Survive Delivery. All representations, warranties and agreements
contained in this Agreement or in certificates of officers of the
Company or trustees of the Trust submitted pursuant hereto shall
remain operative and in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter or
controlling person, or by or on behalf of the Trust or the
Company, and shall survive delivery of the Capital Securities to
the Underwriters.
SECTION 9. Termination of Agreement.
(a) Termination; General. The Representatives may
terminate this Agreement, by notice to the Offerors, at any time
at or prior to the Closing Time (i) if there has been, since the
time of execution of this Agreement or since the respective dates
as of which information is given in the Prospectus, any material
adverse change in the condition, financial or otherwise,
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or in the earnings, business affairs or business prospects of the
Trust or the Company and its subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of business, or
(ii) if there has occurred any material adverse change in the
financial markets in the United States or any outbreak of
hostilities or escalation thereof or other calamity or crisis, in
each case the effect of which is such as to make it, in the
judgment of the Representatives, impracticable to market the
Capital Securities or to enforce contracts for the sale of the
Capital Securities, or (iii) if trading in any securities of the
Company has been suspended or limited by the Commission, or if
trading generally on the American Stock Exchange or the New York
Stock Exchange or in the NASDAQ National Market System has been
suspended or limited, or minimum or maximum prices for trading
have been fixed, or maximum ranges for prices have been required,
by any of said exchanges or by such system or by order of the
Commission, the NASD or any other governmental authority, or (iv)
if a banking moratorium has been declared by either Federal or
New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant
to this Section, such termination shall be without liability of
any party to any other party except as provided in Section 4
hereof, and provided further that Sections 1, 6, 7 and 8 shall
survive such termination and remain in full force and effect.
SECTION 10. Default by One or More of the Underwriters.
If one or more of the Underwriters shall fail at the Closing Time
to purchase the Capital Securities which it or they are obligated
to purchase under this Agreement (the "Defaulted Securities"),
the Representatives shall have the right, within 24 hours
thereafter, to make arrangements for one or more of the
non-defaulting Underwriters, or any other underwriters, to
purchase all, but not less than all, of the Defaulted Securities
in such amounts as may be agreed upon and upon the terms herein
set forth; if, however, the Representatives shall not have
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 Capital Securities to be
purchased hereunder, each of the non-defaulting Underwriters
shall be obligated, severally and not jointly, to purchase
the full amount thereof in the proportions that their
respective underwriting obligations hereunder bear to the
underwriting obligations of all non-defaulting Underwriters,
or
(b) if the number of Defaulted Securities exceeds 10%
of the total number of Capital Securities to be purchased
hereunder, this Agreement shall terminate without liability
on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any
defaulting Underwriter from liability in respect of its default.
In the event of any such default which does not result in a
termination of this Agreement, either the Representatives 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 Registration
22
<PAGE>
Statement or Prospectus or in any other documents or arrangements.
As used herein, the term "Underwriter" includes any person
substituted for an Underwriter under this Section 10.
SECTION 11. Notices. All notices and other
communications hereunder shall be in writing and shall be deemed
to have been duly given if mailed or transmitted by any standard
form of telecommunication. Notices to the Underwriters shall be
directed to the Representatives c/o Morgan Stanley at 1585
Broadway, New York, New York 10036, attention of
_________________________, with a copy to Skadden, Arps, Slate,
Meagher & Flom LLP, 919 Third Avenue, New York, New York 10022,
Attention of Gregory A. Fernicola, Esq.; notices to the Offerors
shall be directed to BankBoston Corporation, 100 Federal Street,
MA BOS 01-25-01, Boston, Massachusetts 02110, attention of Gary
A. Spiess, General Counsel with a copy to Brown & Wood llp, One
World Trade Center, 58th Floor, New York, New York 10048,
Attention of Edward F. Petrosky, Esq.
SECTION 12. Parties. This Agreement shall each inure to
the benefit of and be binding upon the Underwriters and the
Offerors and their respective successors. Nothing expressed or
mentioned in this Agreement is intended or shall be construed to
give any person, firm or corporation, other than the Underwriters
and the Offerors and their respective successors and the
controlling persons and officers, directors and trustees referred
to in Sections 6 and 7 and their heirs and legal representatives,
any legal or equitable right, remedy or claim under or in respect
of this Agreement or any provision herein contained. This
Agreement and all conditions and provisions hereof are intended
to be for the sole and exclusive benefit of the Underwriters and
the Offerors and their respective successors, and said
controlling persons and officers, directors and trustees and
their heirs and legal representatives, and for the benefit of no
other person, firm or corporation. No purchaser of Capital
Securities from any Underwriter shall be deemed to be a successor
by reason merely of such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK.
SECTION 14. Effect of Headings. The Article and Section
headings herein and the Table of Contents are for convenience
only and shall not affect the construction hereof.
23
<PAGE>
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to the Company a
counterpart hereof, whereupon this instrument, along with all
counterparts, will become a binding agreement among the
Underwriters and the Offerors in accordance with its terms.
Very truly yours,
BANKBOSTON CORPORATION
By
--------------------------
Title:
BANKBOSTON CAPITAL TRUST III
By
--------------------------
Title:
CONFIRMED AND ACCEPTED,
as of the date first above
written:
MORGAN STANLEY & CO.
INCORPORATED
CS FIRST BOSTON CORPORATION
LEHMAN BROTHERS INC.
SALOMON BROTHERS INC
By: MORGAN STANLEY & CO. INCORPORATED
By
-----------------------------------
Authorized Signatory
For themselves and as representative of the other Underwriters
named in Schedule A hereto.
24
<PAGE>
SCHEDULE A
Number of
Name of Underwriter Capital Securities
------------------- ------------------
MORGAN STANLEY & CO. INCORPORATED . . . . . . .
CS FIRST BOSTON CORPORATION . . . . . . . . . .
LEHMAN BROTHERS INC. . . . . . . . . . . . . .
SALOMON BROTHERS INC . . . . . . . . . . . . .
--------
Total . . . . . . . . . . . . . . . . . . . . . 250,000
========
Sch A-1
<PAGE>
SCHEDULE B
BANKBOSTON CAPITAL TRUST III
250,000
Floating Rate Capital Securities
(Liquidation Amount of $1,000 Per Capital Security)
1. The initial public offering price for the Capital
Securities, determined as provided in said Section 2, shall be $
_________ per security.
2. The purchase price for the Capital Securities to be
paid by the several Underwriters shall be $_______ per security,
being an amount equal to the initial public offering price set
forth above.
3. The commission for the Capital Securities to be paid by
the Company to the Underwriters for their commitments hereunder
shall be $_____ per Capital Security.
Sch B-1
<PAGE>
EXHIBIT 4.1
BANKBOSTON CORPORATION
______________________________
______________________________
INDENTURE
DATED AS OF _______, 1997
______________________________
THE BANK OF NEW YORK
AS TRUSTEE
______________________________
FLOATING RATE JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES
<PAGE>
TIE-SHEET
of provisions of Trust Indenture Act of 1939 with Indenture
dated as of _______, 1997 between BankBoston Corporation and The
Bank of New York, Trustee:
ACT SECTION INDENTURE SECTION
310(a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . 6.09
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . 6.09
310(a)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . N/A
(a)(4) . . . . . . . . . . . . . . . . . . . . . . . . . . N/A
310(a)(5) . . . . . . . . . . . . . . . . . . . . . . 6.10, 6.11
310(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . N/A
310(c) . . . . . . . . . . . . . . . . . . . . . . . . . . 6.13
311(a) and (b) . . . . . . . . . . . . . . . . . . . . . . . N/A
311(c) . . . . . . . . . . . . . . . . . . . . . . 4.01, 4.02(a)
312(a) . . . . . . . . . . . . . . . . . . . . . . . . . . 4.02
312(b) and (c) . . . . . . . . . . . . . . . . . . . . . . 4.04
313(a) . . . . . . . . . . . . . . . . . . . . . . . . . . 4.04
313(b)(1) . . . . . . . . . . . . . . . . . . . . . . . . . 4.04
313(b)(2) . . . . . . . . . . . . . . . . . . . . . . . . . 4.04
313(c) . . . . . . . . . . . . . . . . . . . . . . . . . . 4.04
313(d) . . . . . . . . . . . . . . . . . . . . . . . . . . 4.04
314(a) . . . . . . . . . . . . . . . . . . . . . . . . . . 4.03
314(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . N/A
314(c)(1) and (2) . . . . . . . . . . . . . . . . . . . . . 6.07
314(c)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . N/A
314(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . N/A
314(e) . . . . . . . . . . . . . . . . . . . . . . . . . . 6.07
314(f) . . . . . . . . . . . . . . . . . . . . . . . . . . . N/A
315(a)(c) and (d) . . . . . . . . . . . . . . . . . . . . . 6.01
315(b) . . . . . . . . . . . . . . . . . . . . . . . . . . 5.08
315(e) . . . . . . . . . . . . . . . . . . . . . . . . . . 5.09
316(a)(1) . . . . . . . . . . . . . . . . . . . . . . . . 5.07
316(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . N/A
316(a) last sentence . . . . . . . . . . . . . . . . . . . 2.09
316(b) . . . . . . . . . . . . . . . . . . . . . . . . . . 9.02
317(a) . . . . . . . . . . . . . . . . . . . . . . . . . . 5.05
317(b) . . . . . . . . . . . . . . . . . . . . . . . . . . 6.05
318(a) . . . . . . . . . . . . . . . . . . . . . . . . . . 13.08
THIS TIE-SHEET IS NOT PART OF THE INDENTURE AS EXECUTED.
<PAGE>
TABLE OF CONTENTS*
Page
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions . . . . . . . . . . . . . . . 1
Additional Interest . . . . . . . . . . . . . . . . . . 1
Affiliate . . . . . . . . . . . . . . . . . . . . . . . 1
Allocable Amounts . . . . . . . . . . . . . . . . . . . 2
Authenticating Agent . . . . . . . . . . . . . . . . . . 2
Bankruptcy Law . . . . . . . . . . . . . . . . . . . . . 2
Board of Directors . . . . . . . . . . . . . . . . . . . 2
Board Resolution . . . . . . . . . . . . . . . . . . . . 2
Business Day . . . . . . . . . . . . . . . . . . . . . . 2
Calculation Agent . . . . . . . . . . . . . . . . . . . 3
Capital Securities . . . . . . . . . . . . . . . . . . . 3
Capital Securities Guarantee . . . . . . . . . . . . . . 3
Commission . . . . . . . . . . . . . . . . . . . . . . . 3
Common Securities . . . . . . . . . . . . . . . . . . . 3
Common Securities Guarantee . . . . . . . . . . . . . . 3
Common Stock . . . . . . . . . . . . . . . . . . . . . . 3
Company . . . . . . . . . . . . . . . . . . . . . . . . 3
Company Request . . . . . . . . . . . . . . . . . . . . 4
Compounded Interest . . . . . . . . . . . . . . . . . . 4
Custodian . . . . . . . . . . . . . . . . . . . . . . . 4
Declaration . . . . . . . . . . . . . . . . . . . . . . 4
Default . . . . . . . . . . . . . . . . . . . . . . . . 4
Deferred Interest . . . . . . . . . . . . . . . . . . . 4
Definitive Securities . . . . . . . . . . . . . . . . . 4
Depositary . . . . . . . . . . . . . . . . . . . . . . . 4
Determination Date . . . . . . . . . . . . . . . . . . . 4
Dissolution Event . . . . . . . . . . . . . . . . . . . 4
Event of Default . . . . . . . . . . . . . . . . . . . . 4
Exchange Act . . . . . . . . . . . . . . . . . . . . . . 4
Extended Interest Payment Period . . . . . . . . . . . . 4
Federal Reserve . . . . . . . . . . . . . . . . . . . . 5
Global Security . . . . . . . . . . . . . . . . . . . . 5
Indebtedness for Money Borrowed . . . . . . . . . . . . 5
Indebtedness Ranking on a Parity with the Securities . . 5
Indebtedness Ranking Junior to the Securities . . . . . 5
Indenture . . . . . . . . . . . . . . . . . . . . . . . 5
Interest Payment Date . . . . . . . . . . . . . . . . . 5
Interest Period . . . . . . . . . . . . . . . . . . . . 6
LIBOR . . . . . . . . . . . . . . . . . . . . . . . . . 6
----------------------
* THIS TABLE OF CONTENTS SHALL NOT, FOR ANY PURPOSE, BE
DEEMED TO BE A PART OF THE INDENTURE.
i
<PAGE>
Page
London Business Day . . . . . . . . . . . . . . . . . . 6
Maturity Date . . . . . . . . . . . . . . . . . . . . . 6
Mortgage . . . . . . . . . . . . . . . . . . . . . . . . 6
Non Book-Entry Capital Securities . . . . . . . . . . . 6
Officers . . . . . . . . . . . . . . . . . . . . . . . . 6
Officers' Certificate . . . . . . . . . . . . . . . . . 6
Opinion of Counsel . . . . . . . . . . . . . . . . . . . 6
Other Debentures . . . . . . . . . . . . . . . . . . . . 6
Other Guarantees . . . . . . . . . . . . . . . . . . . . 6
outstanding . . . . . . . . . . . . . . . . . . . . . . 6
Person . . . . . . . . . . . . . . . . . . . . . . . . . 7
Predecessor Security . . . . . . . . . . . . . . . . . . 7
Principal office of the Trustee . . . . . . . . . . . . 7
Redemption Price . . . . . . . . . . . . . . . . . . . . 7
Regulatory Capital Event . . . . . . . . . . . . . . . . 7
Responsible Officer . . . . . . . . . . . . . . . . . . 8
Reuters Page LIBO . . . . . . . . . . . . . . . . . . . 8
Securities . . . . . . . . . . . . . . . . . . . . . . . 8
Securities Act . . . . . . . . . . . . . . . . . . . . . 8
Securityholder . . . . . . . . . . . . . . . . . . . . . 8
holder of Securities . . . . . . . . . . . . . . . . . . 8
Security Register . . . . . . . . . . . . . . . . . . . 8
Senior Indebtedness . . . . . . . . . . . . . . . . . . 8
Special Event . . . . . . . . . . . . . . . . . . . . . 8
Subsidiary . . . . . . . . . . . . . . . . . . . . . . . 8
Tax Event . . . . . . . . . . . . . . . . . . . . . . . 9
Trust . . . . . . . . . . . . . . . . . . . . . . . . . 9
Trustee . . . . . . . . . . . . . . . . . . . . . . . . 9
Trust Indenture Act of 1939 . . . . . . . . . . . . . . 9
Trust Securities . . . . . . . . . . . . . . . . . . . . 10
U.S. Government Obligations . . . . . . . . . . . . . . 10
ARTICLE II
SECURITIES
SECTION 2.01. Forms Generally . . . . . . . . . . . . . 10
SECTION 2.02. Execution and Authentication . . . . . . 10
SECTION 2.03. Form and Payment . . . . . . . . . . . . 11
SECTION 2.04. [Reserved]. . . . . . . . . . . . . . . . 11
SECTION 2.05. Global Security . . . . . . . . . . . . . 11
SECTION 2.06. Interest . . . . . . . . . . . . . . . . 13
SECTION 2.07. Transfer and Exchange . . . . . . . . . . 16
SECTION 2.08. Replacement Securities . . . . . . . . . 17
SECTION 2.09. Treasury Securities . . . . . . . . . . . 17
SECTION 2.10. Temporary Securities. . . . . . . . . . . 17
SECTION 2.11. Cancellation . . . . . . . . . . . . . . 18
SECTION 2.12. Defaulted Interest . . . . . . . . . . . 18
SECTION 2.13. CUSIP Numbers . . . . . . . . . . . . . . 19
ii
<PAGE>
Page
ARTICLE III
PARTICULAR COVENANTS OF THE COMPANY
SECTION 3.01. Payment of Principal, Premium and
Interest . . . . . . . . . . . . . . . . 20
SECTION 3.02. Offices for Notices and Payments, etc. . 20
SECTION 3.03. Appointments to Fill Vacancies in
Trustee's Office . . . . . . . . . . . . 21
SECTION 3.04. Provision as to Paying Agent . . . . . . 21
SECTION 3.05. Certificate to Trustee . . . . . . . . . 22
SECTION 3.06. Compliance with Consolidation
Provisions . . . . . . . . . . . . . . . 22
SECTION 3.07. Limitation on Dividends . . . . . . . . . 22
SECTION 3.08. Covenants as to the Trust . . . . . . . . 23
SECTION 3.09. Payment of Expenses . . . . . . . . . . . 23
SECTION 3.10. Payment Upon Resignation or Removal . . . 24
ARTICLE IV
SECURITYHOLDERS' LISTS AND REPORTS BY THE
COMPANY AND THE TRUSTEE
SECTION 4.01. Securityholders' Lists . . . . . . . . . 25
SECTION 4.02. Preservation and Disclosure of Lists . . 25
SECTION 4.03. Reports by Company . . . . . . . . . . . 27
SECTION 4.04. Reports by the Trustee . . . . . . . . . 28
ARTICLE V
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT
SECTION 5.01. Events of Default . . . . . . . . . . . . 28
SECTION 5.02. Payment of Securities on Default; Suit
Therefor . . . . . . . . . . . . . . . . 31
SECTION 5.03. Application of Moneys Collected by
Trustee . . . . . . . . . . . . . . . . . 33
SECTION 5.04. Proceedings by Securityholders . . . . . 33
SECTION 5.05. Proceedings by Trustee . . . . . . . . . 34
SECTION 5.06. Remedies Cumulative and Continuing . . . 35
SECTION 5.07. Direction of Proceedings and Waiver of
Defaults by Majority of Securityholders . 35
SECTION 5.08. Notice of Defaults . . . . . . . . . . . 36
SECTION 5.09. Undertaking to Pay Costs . . . . . . . . 36
ARTICLE VI
CONCERNING THE TRUSTEE
SECTION 6.01. Duties and Responsibilities of Trustee . 37
SECTION 6.02. Reliance on Documents, Opinions, etc. . . 38
SECTION 6.03. No Responsibility for Recitals, etc. . . 40
iii
<PAGE>
Page
SECTION 6.04. Trustee, Authenticating Agent, Paying
Agents, Transfer Agents or Registrar May
Own Securities . . . . . . . . . . . . . 40
SECTION 6.05. Moneys to be Held in Trust . . . . . . . 41
SECTION 6.06. Compensation and Expenses of Trustee . . 41
SECTION 6.07. Officers' Certificate as Evidence . . . . 42
SECTION 6.08. Conflicting Interest of Trustee . . . . . 42
SECTION 6.09. Eligibility of Trustee . . . . . . . . . 42
SECTION 6.10. Resignation or Removal of Trustee . . . . 43
SECTION 6.11. Acceptance by Successor Trustee . . . . . 44
SECTION 6.12. Succession by Merger, etc. . . . . . . . 45
SECTION 6.13. Limitation on Rights of Trustee as a
Creditor . . . . . . . . . . . . . . . . 46
SECTION 6.14. Authenticating Agents . . . . . . . . . . 46
ARTICLE VII
CONCERNING THE SECURITYHOLDERS
SECTION 7.01. Action by Securityholders . . . . . . . . 47
SECTION 7.02. Proof of Execution by Securityholders . . 48
SECTION 7.03. Who Are Deemed Absolute Owners . . . . . 48
SECTION 7.04. Securities Owned by Company Deemed Not
Outstanding . . . . . . . . . . . . . . . 49
SECTION 7.05. Revocation of Consents; Future Holders
Bound . . . . . . . . . . . . . . . . . . 49
ARTICLE VIII
SECURITYHOLDERS' MEETINGS
SECTION 8.01. Purposes of Meetings . . . . . . . . . . 50
SECTION 8.02. Call of Meetings by Trustee . . . . . . . 50
SECTION 8.03. Call of Meetings by Company or
Securityholders . . . . . . . . . . . . . 51
SECTION 8.04. Qualifications for Voting . . . . . . . . 51
SECTION 8.05. Regulations . . . . . . . . . . . . . . . 51
SECTION 8.06. Voting . . . . . . . . . . . . . . . . . 52
ARTICLE IX
AMENDMENTS
SECTION 9.01. Without Consent of Securityholders . . . 52
SECTION 9.02. With Consent of Securityholders . . . . . 54
SECTION 9.03. Compliance with Trust Indenture Act;
Effect of Supplemental Indentures . . . . 55
SECTION 9.04. Notation on Securities . . . . . . . . . 56
SECTION 9.05. Evidence of Compliance of Supplemental
Indenture to be Furnished Trustee . . . . 56
iv
<PAGE>
Page
ARTICLE X
CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE
SECTION 10.01. Company May Consolidate, etc., on
Certain Terms . . . . . . . . . . . . . . 56
SECTION 10.02. Successor Corporation to be Substituted
for Company . . . . . . . . . . . . . . . 57
SECTION 10.03. Opinion of Counsel to be Given Trustee . 57
ARTICLE XI
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 11.01. Discharge of Indenture . . . . . . . . . 58
SECTION 11.02. Deposited Moneys and U.S. Government
Obligations to be Held in Trust by
Trustee . . . . . . . . . . . . . . . . . 58
SECTION 11.03. Paying Agent to Repay Moneys Held . . . . 59
SECTION 11.04. Return of Unclaimed Moneys . . . . . . . 59
SECTION 11.05. Defeasance Upon Deposit of Moneys or
U.S. Government Obligations . . . . . . . 59
ARTICLE XII
IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS
SECTION 12.01. Indenture and Securities Solely
Corporate Obligations . . . . . . . . . . 61
ARTICLE XIII
MISCELLANEOUS PROVISIONS
SECTION 13.01. Successors . . . . . . . . . . . . . . . 62
SECTION 13.02. Official Acts by Successor Corporation . 62
SECTION 13.03. Surrender of Company Powers . . . . . . . 62
SECTION 13.04. Addresses for Notices, etc. . . . . . . . 62
SECTION 13.05. Governing Law . . . . . . . . . . . . . . 62
SECTION 13.06. Evidence of Compliance with Conditions
Precedent . . . . . . . . . . . . . . . . 63
SECTION 13.07. Business Days . . . . . . . . . . . . . . 63
SECTION 13.08. Trust Indenture Act to Control . . . . . 63
SECTION 13.09. Table of Contents, Headings, etc . . . . 64
SECTION 13.10. Execution in Counterparts . . . . . . . . 64
SECTION 13.11. Separability . . . . . . . . . . . . . . 64
SECTION 13.12. Assignment . . . . . . . . . . . . . . . 64
SECTION 13.13. Acknowledgement of Rights . . . . . . . . 64
ARTICLE XIV
REDEMPTION OF SECURITIES --
MANDATORY AND OPTIONAL SINKING FUND
v
<PAGE>
Page
SECTION 14.01. Special Event Redemption . . . . . . . . 65
SECTION 14.02. Optional Redemption by Company . . . . . 65
SECTION 14.03. No Sinking Fund . . . . . . . . . . . . . 66
SECTION 14.04. Notice of Redemption; Selection of
Securities . . . . . . . . . . . . . . . 66
SECTION 14.05. Payment of Securities Called for
Redemption . . . . . . . . . . . . . . . 67
ARTICLE XV
SUBORDINATION OF SECURITIES
SECTION 15.01. Agreement to Subordinate . . . . . . . . 68
SECTION 15.02. Default on Senior Indebtedness . . . . . 68
SECTION 15.03. Liquidation; Dissolution; Bankruptcy . . 69
SECTION 15.04. Subrogation . . . . . . . . . . . . . . . 70
SECTION 15.05. Trustee to Effectuate Subordination . . . 71
SECTION 15.06. Notice by the Company . . . . . . . . . . 72
SECTION 15.07. Rights of the Trustee; Holders of Senior
Indebtedness . . . . . . . . . . . . . . 73
SECTION 15.08. Subordination May Not Be Impaired . . . . 73
ARTICLE XVI
EXTENSION OF INTEREST PAYMENT PERIOD
SECTION 16.01. Extension of Interest Payment Period . . 74
SECTION 16.02. Notice of Extension . . . . . . . . . . . 75
EXHIBIT A . . . . . . . . . . . . . . . . . . . . . . . . . . A-1
Testimonium
Signatures
vi
<PAGE>
THIS INDENTURE, dated as of _______, 1997, between
BankBoston Corporation, a Massachusetts corporation (hereinafter
sometimes called the "Company"), and The Bank of New York, a New
York banking corporation, as trustee (hereinafter sometimes
called the "Trustee"),
W I T N E S S E T H :
In consideration of the premises, and the purchase of
the Securities by the holders thereof, the Company covenants and
agrees with the Trustee for the equal and proportionate benefit
of the respective holders from time to time of the Securities, as
follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions.
The terms defined in this Section 1.01 (except as
herein otherwise expressly provided or unless the context
otherwise requires) for all purposes of this Indenture shall have
the respective meanings specified in this Section 1.01. All
other terms used in this Indenture which are defined in the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"), or
which are by reference therein defined in the Securities Act,
shall (except as herein otherwise expressly provided or unless
the context otherwise requires) have the meanings assigned to
such terms in said Trust Indenture Act and in said Securities Act
as in force at the date of this Indenture as originally executed.
The following terms have the meanings given to them in the
Declaration: (i) Clearing Agency; (ii) Delaware Trustee;
(iii) Capital Security Certificate; (iv) Property Trustee; (v)
Administrative Trustees; (vi) Direct Action; and (vii) Purchase
Agreement. All accounting terms used herein and not expressly
defined shall have the meanings assigned to such terms in
accordance with generally accepted accounting principles and the
term "generally accepted accounting principles" means such
accounting principles as are generally accepted at the time of
any computation. 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. Headings are used for convenience of reference only
and do not affect interpretation. The singular includes the
plural and vice versa.
"Additional Interest" shall have the meaning set forth
in Section 2.06(d).
"Affiliate" means, with respect to a specified Person,
(a) any Person directly or indirectly owning, controlling or
<PAGE>
holding the power to vote 10% or more of the outstanding voting
securities or other ownership interests of the specified Person,
(b) any Person 10% or more of whose outstanding voting securities
or other ownership interests are directly or indirectly owned,
controlled or held with power to vote by the specified Person,
(c) any Person directly or indirectly controlling, controlled by,
or under common control with the specified Person, (d) a
partnership in which the specified Person is a general partner,
(e) any officer or director of the specified Person, and (f) if
the specified Person is an individual, any entity of which the
specified Person is an officer, director or general partner.
"Allocable Amounts," when used with respect to any
Senior Indebtedness, means all amounts due or to become due on
such Senior Indebtedness less, if applicable, any amount which
would have been paid to, and retained by, the holders of such
Senior Indebtedness (whether as a result of the receipt of
payments by the holders of such Senior Indebtedness from the
Company or any other obligor thereon or from any holders of, or
trustee in respect of, other indebtedness that is subordinate and
junior in right of payment to such Senior Indebtedness pursuant
to any provision of such indebtedness for the payment over of
amounts received on account of such indebtedness to the holders
of such Senior Indebtedness or otherwise) but for the fact that
such Senior Indebtedness is subordinate or junior in right of
payment to (or subject to a requirement that amounts received on
such Senior Indebtedness be paid over to obligees on) trade
accounts payable or accrued liabilities arising in the ordinary
course of business.
"Authenticating Agent" shall mean any agent or agents
of the Trustee which at the time shall be appointed and acting
pursuant to Section 6.14.
"Bankruptcy Law" shall mean Title 11, U.S. Code, or any
similar Federal or state law for the relief of debtors.
"Board of Directors" shall mean either the Board of
Directors of the Company or any duly authorized committee of that
board.
"Board Resolution" shall mean a copy of a resolution
certified by the Clerk or an Assistant Clerk of the Company to
have been duly adopted by the Board of Directors and to be in
full force and effect on the date of such certification, and
delivered to the Trustee.
"Business Day" shall mean, with respect to any
Securities, any day other than a Saturday or a Sunday or a day on
which banking institutions in The City of New York or Boston,
Massachusetts are authorized or required by law or executive
order to close.
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"Calculation Agent" shall mean The Bank of New York or
any successor as shall be appointed by the Company.
"Capital Securities" shall mean undivided beneficial
interests in the assets of the Trust designated as the Floating
Rate Capital Securities, which rank pari passu with the Common
Securities issued by the Trust; provided, however, that if an
Event of Default has occurred and is continuing, no payments in
respect of Distributions on, or payments upon liquidation,
redemption or otherwise with respect to, the Common Securities
shall be made until the holders of the Capital Securities shall
be paid in full the Distributions and the liquidation, redemption
and other payments to which they are entitled.
"Capital Securities Guarantee" shall mean any guarantee
that the Company may enter into with The Bank of New York or
other Persons that operate directly or indirectly for the benefit
of holders of Capital Securities of the Trust.
"Commission" shall mean the 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" shall mean undivided beneficial
interests in the assets of the Trust designated as the Floating
Rate Common Securities, which rank pari passu with Capital
Securities issued by the Trust; provided, however, that if an
Event of Default has occurred and is continuing, no payments in
respect of Distributions on, or payments upon liquidation,
redemption or otherwise with respect to, the Common Securities
shall be made until the holders of the Capital Securities shall
be paid in full the Distributions and the liquidation, redemption
and other payments to which they are entitled.
"Common Securities Guarantee" shall mean any guarantee
that the Company executes directly or indirectly for the benefit
of holders of Common Securities of the Trust.
"Common Stock" shall mean the Common Stock, par value
$1.50 per share, of the Company or any other class of stock
resulting from changes or reclassifications of such Common Stock
consisting solely of changes in par value, or from par value to
no par value, or from no par value to par value.
"Company" shall mean BankBoston Corporation, a
Massachusetts corporation, and, subject to the provisions of
Article X, shall include its successors and assigns.
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"Company Request" or "Company Order" shall mean a
written request or order signed in the name of the Company by the
Chairman, the Chief Executive Officer, the President, a Vice
Chairman, a Vice President, the Comptroller, the Executive
Director, Global Treasury, the Clerk or an Assistant Clerk of the
Company, and delivered to the Trustee.
"Compounded Interest" shall have the meaning set forth
in Section 16.01.
"Custodian" shall mean any receiver, trustee, assignee,
liquidator, or similar official under any Bankruptcy Law.
"Declaration" means the Amended and Restated
Declaration of Trust of the Trust, dated as of _______, 1997.
"Default" means any event, act or condition that with
notice or lapse of time, or both, would constitute an Event of
Default.
"Deferred Interest" shall have the meaning set forth in
Section 16.01.
"Definitive Securities" shall mean those securities
issued in fully registered certificated form not otherwise in
global form.
"Depositary" shall mean, with respect to the
Securities, The Depository Trust Company, New York, New York,
another clearing agency, or any successor registered as a
clearing agency under the Exchange Act or other applicable
statute or regulation, as designated by the Company pursuant to
Section 2.05(d).
"Determination Date" shall have the meaning set forth
in Section 2.06(c).
"Dissolution Event" means the liquidation of the Trust
pursuant to the Declaration, and the distribution of the
Securities held by the Property Trustee to the holders of the
Trust Securities issued by the Trust pro rata in accordance with
the Declaration.
"Event of Default" shall mean any event specified in
Section 5.01, continued for the period of time, if any, and after
the giving of the notice, if any, therein designated.
"Exchange Act" shall mean the Securities Exchange Act
of 1934, as amended.
"Extended Interest Payment Period" shall have the
meaning set forth in Section 16.01.
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"Federal Reserve" shall mean the Board of Governors of
the Federal Reserve System.
"Global Security" means, with respect to the
Securities, a Security executed by the Company and delivered by
the Trustee to the Depositary or pursuant to the Depositary's
instruction, all in accordance with the Indenture, which shall be
registered in the name of the Depositary or its nominee.
"Indebtedness for Money Borrowed" shall mean any
obligation of, or any obligation guaranteed by, the Company for
the repayment of borrowed money, whether or not evidenced by
bonds, debentures, notes or other written instruments.
"Indebtedness Ranking on a Parity with the Securities"
shall mean (i) Indebtedness for Money Borrowed, whether
outstanding on the date of execution of this Indenture or
hereafter created, assumed or incurred, which specifically by its
terms ranks equally with and not prior to the Securities in the
right of payment upon the happening of any dissolution or winding
up or liquidation or reorganization of the Company, and (ii) all
other debt securities, and guarantees in respect of those debt
securities, issued to any trust other than the Trust, or a
trustee of such trust, partnership or other entity affiliated
with the Company that is a financing vehicle of the Company (a
"financing entity") in connection with the issuance by such
financing entity of equity securities or other securities
guaranteed by the Company pursuant to an instrument that ranks
pari passu with or junior in right of payment to the Capital
Securities Guarantee.
"Indebtedness Ranking Junior to the Securities" shall
mean any Indebtedness for Money Borrowed, whether outstanding on
the date of execution of this Indenture or hereafter created,
assumed or incurred, which specifically by its terms ranks junior
to and not equally with or prior to the Securities (and any other
Indebtedness Ranking on a Parity with the Securities) in right of
payment upon the happening of any dissolution or winding up or
liquidation or reorganization of the Company. The securing of
any Indebtedness for Money Borrowed of the Company, otherwise
constituting Indebtedness Ranking on a Parity with the Securities
or Indebtedness Ranking Junior to the Securities, as the case may
be, shall not be deemed to prevent such Indebtedness for Money
Borrowed from constituting Indebtedness Ranking on a Parity with
the Securities or Indebtedness Ranking Junior to the Securities,
as the case may be.
"Indenture" shall mean this instrument as originally
executed or, if amended as herein provided, as so amended.
"Interest Payment Date" shall have the meaning set
forth in Section 2.06(a).
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"Interest Period" shall have the meaning set forth in
Section 2.06(a).
"LIBOR" shall have the meaning set forth in Section
2.06(c)
"London Business Day" shall have the meaning set forth
in Section 2.06(c).
"Maturity Date" shall mean _______, 2027.
"Mortgage" shall mean and include any mortgage, pledge,
lien, security interest, conditional sale or other title
retention agreement or other similar encumbrance.
"Non Book-Entry Capital Securities" shall have the
meaning set forth in Section 2.05.
"Officers" shall mean any of the Chairman, a Vice
Chairman, the Chief Executive Officer, the President, a Vice
President, the Comptroller, the Executive Director, Global
Treasury, the Clerk or an Assistant Clerk of the Company.
"Officers' Certificate" shall mean a certificate signed
by two Officers and delivered to the Trustee.
"Opinion of Counsel" shall mean a written opinion of
counsel, who may be an employee of the Company, and who shall be
acceptable to the Trustee.
"Other Debentures" means all junior subordinated
debentures issued by the Company from time to time and sold to
trusts to be established by the Company, in each case similar to
the Trust.
"Other Guarantees" means all guarantees issued by the
Company with respect to capital securities and issued to other
trusts established by the Company, in each case similar to the
Trust.
The term "outstanding" when used with reference to
Securities, shall, subject to the provisions of Section 7.04,
mean, as of any particular time, all Securities authenticated and
delivered by the Trustee or the Authenticating Agent under this
Indenture, except
(a) Securities theretofore cancelled by the Trustee or
the Authenticating Agent or delivered to the
Trustee for cancellation;
(b) Securities, or portions thereof, for the payment
or redemption of which moneys in the necessary
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amount shall have been deposited in trust with the
Trustee or with any paying agent (other than the
Company) or shall have been set aside and
segregated in trust by the Company (if the Company
shall act as its own paying agent); provided that,
if such Securities, or portions thereof, are to be
redeemed prior to maturity thereof, notice of such
redemption shall have been given as in Article XIV
provided or provision satisfactory to the Trustee
shall have been made for giving such notice; and
(c) Securities in lieu of or in substitution for which
other Securities shall have been authenticated and
delivered pursuant to the terms of Section 2.08
unless proof satisfactory to the Company and the
Trustee is presented that any such Securities are
held by bona fide holders in due course.
"Person" shall mean any individual, corporation,
estate, partnership, joint venture, association, joint-stock
company, limited liability company, trust, unincorporated
organization or government or any agency or political subdivision
thereof.
"Predecessor Security" of any particular Security means
every previous Security evidencing all or a portion of the same
debt and as that evidenced by such particular Security; and, for
the purposes of this definition, any Security authenticated and
delivered under Section 2.08 in lieu of a lost, destroyed or
stolen Security shall be deemed to evidence the same debt as the
lost, destroyed or stolen Security.
"Principal office of the Trustee", or other similar
term, shall mean the principal office of the Trustee, at which at
any particular time its corporate trust business shall be
administered.
"Redemption Price" shall mean, with respect to any
redemption of the Securities pursuant to Sections 14.01 or 14.02
hereof, an amount in cash equal to 100% of the principal amount
of Securities to be redeemed, plus any accrued and unpaid
interest thereon, including Compounded Interest and Additional
Interest, if any, to the date of such redemption.
"Regulatory Capital Event" means that the Company shall
have received an opinion of independent bank regulatory counsel
experienced in such matters to the effect that, as a result of
(a) any amendment to, or change (including any announced
prospective change) in, the laws (or any regulations thereunder)
of the United States or any rules, guidelines or policies of the
Federal Reserve or (b) any official administrative pronouncement
or judicial decision interpreting or applying such laws or
regula-
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tions, which amendment or change is effective or such pronouncement or
decision is announced on or after the date of original issuance of the
Capital Securities, the Capital Securities do not constitute, or within 90
days of the date thereof, will not constitute, Tier I Capital (or its then
equivalent); provided, however, that the distribution of the Capital
Securities in connection with the liquidation of the Trust by the Company,
as sponsor, shall not in and of itself constitute a Regulatory Capital
Event unless such liquidation shall have occurred in connection with a Tax
Event.
"Responsible Officer", when used with respect to the
Trustee, shall mean any vice president, any assistant secretary,
any assistant treasurer, any trust officer or assistant trust
officer or any other officer or assistant officer of the Trustee
customarily performing functions similar to those performed by
any of the above designated officers and also means, with respect
to a particular corporate trust matter, any other officer to whom
such matter is referred because of his knowledge of and
familiarity with the particular subject.
"Reuters Page LIBO" shall have the meaning set forth in
Section 2.06(c).
"Securities" means the Company's Floating Rate Junior
Subordinated Deferrable Interest Debentures due _______, 2027, as
authenticated and issued under this Indenture.
"Securities Act" shall mean the Securities Act of 1933,
as amended.
"Securityholder", "holder of Securities", or other
similar terms, shall mean any person in whose name at the time a
particular Security is registered on the register kept by the
Company or the Trustee for that purpose in accordance with the
terms hereof.
"Security Register" shall have the meaning specified in
Section 2.07(b).
"Senior Indebtedness" shall mean all Indebtedness for
Money Borrowed, whether outstanding on the date of execution of
this Indenture or hereafter created, assumed or incurred, except
Indebtedness Ranking on a Parity with the Securities or
Indebtedness Ranking Junior to the Securities, and any deferrals,
renewals or extensions of such Senior Indebtedness.
"Special Event" means either a Regulatory Capital Event
or a Tax Event.
"Subsidiary" shall mean with respect to any Person,
(i) any corporation at least a majority of whose outstanding
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voting stock of which is owned, directly or indirectly, by such
Person or by one or more of its Subsidiaries, or by such Person
and one or more of its Subsidiaries, (ii) any general
partnership, joint venture or similar entity, at least a majority
of whose outstanding partnership or similar interests shall at
the time be owned by such Person, or by one or more of its
Subsidiaries, or by such Person and one or more of its
Subsidiaries and (iii) any limited partnership of which such
Person or any of its Subsidiaries is a general partner. For the
purposes of this definition, "voting stock" means shares,
interests, participations or other equivalents in the equity
interest (however designated) in such Person having ordinary
voting power for the election of a majority of the directors (or
the equivalent) of such Person, other than shares, interests,
participations or other equivalents having such power only by
reason of the occurrence of a contingency.
"Tax Event" shall mean the receipt by the Trust and the
Company 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 _______, 1997, there is more
than an insubstantial risk that (i) the Trust 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 Securities, (ii) interest payable by the Company
on the Securities is not, or within 90 days of the date of such
opinion, will not be, deductible by the Company, in whole or in
part, for United States Federal income tax purposes, or (iii) the
Trust is, or will be within 90 days of the date of such opinion,
subject to more than a de minimis amount of other taxes, duties
or other governmental charges.
"Trust" shall mean BankBoston Capital Trust III, a
Delaware business trust created for the purpose of issuing its
undivided beneficial interests in connection with the issuance of
Securities under this Indenture.
"Trustee" shall mean the Person identified as "Trustee"
in the first paragraph hereof, and, subject to the provisions of
Article VI hereof, shall also include its successors and assigns
as Trustee hereunder.
"Trust Indenture Act of 1939" shall mean the Trust
Indenture Act of 1939 as in force at the date of execution of
this Indenture, except as provided in Section 9.03.
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"Trust Securities" shall mean the Capital Securities
and the Common Securities, collectively.
"U.S. Government Obligations" shall mean securities
that are (i) direct obligations of the United States of America
for the payment of which its full faith and credit is pledged or
(ii) obligations of a Person controlled or supervised by and
acting as an agency or instrumentality of the United States of
America the payment of which is unconditionally guaranteed as a
full faith and credit obligation by the United States of America,
which, in either case under clauses (i) or (ii) are not callable
or redeemable at the option of the issuer thereof, and shall also
include a depository receipt issued by a bank or trust company as
custodian with respect to any such U.S. Government Obligation or
a specific payment of interest on or principal of any such U.S.
Government Obligation held by such custodian for the account of
the holder of a depository receipt, provided that (except as
required by law) such custodian is not authorized to make any
deduction from the amount payable to the holder of such
depository receipt from any amount received by the custodian in
respect of the U.S. Government Obligation or the specific payment
of interest on or principal of the U.S. Government Obligation
evidenced by such depository receipt.
ARTICLE II
SECURITIES
SECTION 2.01. Forms Generally.
The Securities and the Trustee's certificate of
authentication shall be substantially in the form of Exhibit A,
the terms of which are incorporated in and made a part of this
Indenture. The Securities may have notations, legends or
endorsements required by law, stock exchange rule, agreements to
which the Company is subject or usage. Each Security shall be
dated the date of its authentication. The Securities shall be
issued in denominations of $1,000 and integral multiples thereof.
SECTION 2.02. Execution and Authentication.
An Officer shall sign the Securities for the Company by
manual or facsimile signature. If an Officer whose signature is
on a Security no longer holds that office at the time the
Security is authenticated, the Security shall nevertheless be
valid.
A Security shall not be valid until authenticated by
the manual signature of the Trustee. The signature of the
Trustee shall be conclusive evidence that the Security has been
authenticated under this Indenture. The form of Trustee's
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certificate of authentication to be borne by the Securities shall
be substantially as set forth in Exhibit A hereto.
The Trustee shall, upon a Company Order, authenticate
for original issue up to and including, and the aggregate
principal amount of Securities outstanding at any time may not
exceed, $257,732,000 aggregate principal amount of the
Securities, except as provided in Sections 2.07, 2.08, 2.10 and
14.05.
SECTION 2.03. Form and Payment.
Except as provided in Section 2.05, the Securities
shall be issued in fully registered certificated form without
interest coupons. Principal of and premium, if any, and interest
on the Securities issued in certificated form will be payable,
the transfer of such Securities will be registrable and such
Securities will be exchangeable for Securities bearing identical
terms and provisions at the office or agency of the Trustee;
provided, however, that payment of interest with respect to
Securities in global form may be made at the option of the
Company (i) by check mailed to the holder at such address as
shall appear in the Security Register or (ii) by transfer to an
account maintained by the Person entitled thereto, provided that
proper transfer instructions have been received in writing by the
relevant record date. Notwithstanding the foregoing, so long as
the holder of any Securities is the Property Trustee, the payment
of the principal of and premium, if any, and interest (including
Compounded Interest and Additional Interest, if any) on such
Securities held by the Property Trustee will be made at such
place and to such account as may be designated by the Property
Trustee.
SECTION 2.04. [Reserved].
SECTION 2.05. Global Security.
(a) In connection with a Dissolution Event,
(i) if any Capital Securities are held in book-
entry form, the related Definitive Securities shall be
presented to the Trustee (if an arrangement with the
Depositary has been maintained) by the Property Trustee in
exchange for one or more Global Securities (as may be
required pursuant to Section 2.07) in an aggregate principal
amount equal to the aggregate principal amount of all
outstanding Securities, to be registered in the name of the
Depositary, or its nominee, and delivered by the Trustee to
the Depositary for crediting to the accounts of its
participants pursuant to the instructions of the
Administrative Trustees; the Company upon any such
presentation shall execute one or more Global Securities in
such aggregate principal amount and deliver the same to the
Trustee for authentication and delivery in
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accordance with the Indenture; and payments on the Securities
issued as a Global Security will be made to the Depositary; and
(ii) if any Capital Securities are held in
certificated form, the related Definitive Securities may be
presented to the Trustee by the Property Trustee and any
Capital Security certificate which represents Capital
Securities other than Capital Securities in book-entry form
("Non Book-Entry Capital Securities") will be deemed to
represent beneficial interests in Securities presented to
the Trustee by the Property Trustee having an aggregate
principal amount equal to the aggregate liquidation amount
of the Non Book-Entry Capital Securities until such Capital
Security certificates are presented to the Security
registrar for transfer or reissuance, at which time such
Capital Security certificates will be cancelled and a
Security, registered in the name of the holder of the
Capital Security certificate or the transferee of the holder
of such Capital Security certificate, as the case may be,
with an aggregate principal amount equal to the aggregate
liquidation amount of the Capital Security certificate
cancelled, will be executed by the Company and delivered to
the Trustee for authentication and delivery in accordance
with the Indenture. Upon the issuance of such Securities,
Securities with an equivalent aggregate principal amount
that were presented by the Property Trustee to the Trustee
will be deemed to have been cancelled.
(b) The Global Securities shall represent the
aggregate amount of outstanding Securities from time to time
endorsed thereon; provided, that the aggregate amount of
outstanding Securities represented thereby may from time to time
be reduced or increased, as appropriate, to reflect exchanges and
redemptions. Any endorsement of a Global Security to reflect the
amount of any increase or decrease in the amount of outstanding
Securities represented thereby shall be made by the Trustee, in
accordance with instructions given by the Company as required by
this Section 2.05.
(c) The Global Securities may be transferred, in whole
but not in part, only to another nominee of the Depositary, or to
a successor Depositary selected or approved by the Company or to
a nominee of such successor Depositary.
(d) If at any time the Depositary notifies the Company
that it is unwilling or unable to continue as Depositary or the
Depositary has ceased to be a clearing agency registered under
the Exchange Act, and a successor Depositary is not appointed by
the Company within 90 days after the Company receives such notice
or becomes aware of such condition, as the case may be, the
Company will execute, and the Trustee, upon written notice from
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the Company, will authenticate and make available for delivery
the Definitive Securities, in authorized denominations, and in an
aggregate principal amount equal to the principal amount of the
Global Security in exchange for such Global Security. If there
is a Default or an Event of Default, the Depositary shall have
the right to exchange the Global Securities for Definitive
Securities. In addition, the Company may at any time determine
that the Securities shall no longer be represented by a Global
Security. In the event of such a Default or an Event of Default
or such a determination, the Company shall execute, and subject
to Section 2.07, the Trustee, upon receipt of an Officers'
Certificate evidencing such determination by the Company, will
authenticate and make available for delivery the Definitive
Securities, in authorized denominations, and in an aggregate
principal amount equal to the principal amount of the Global
Security in exchange for such Global Security. Upon the exchange
of the Global Security for such Definitive Securities, in
authorized denominations, the Global Security shall be cancelled
by the Trustee. Such Definitive Securities issued in exchange
for the Global Security shall be registered in such names and in
such authorized denominations as the Depositary, pursuant to
instructions from its direct or indirect participants or
otherwise, shall instruct the Trustee. The Trustee shall deliver
such Definitive Securities to the Depositary for delivery to the
Persons in whose names such Definitive Securities are so
registered.
SECTION 2.06. Interest.
(a) Each Security will bear interest at the rate
determined as provided below, payable quarterly in arrears
(subject to the provisions of Article XVI) on __________,
__________, __________ and ___________ of each year, commencing
on __________, 1997 (each, an "Interest Payment Date"), to the
Person in whose name such Security or any predecessor Security is
registered, at the close of business on the regular record date
for such interest installment, which shall be the __________,
__________, __________ and ___________ prior to the applicable
Interest Payment Date. Interest payable on each Interest Payment
Date shall include interest accrued from and including the
immediately preceding Interest Payment Date (or, if no interest
has been paid or duly provided for, the date of original
issuance) to but excluding such Interest Payment Date (each, an
"Interest Period").
(b) The amount of interest payable for any Interest
Period shall be computed on the basis of the actual number of
days elapsed in such Interest Period and a year of 360 days.
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 periodic rate determined
as provided below, compounded quarterly from the relevant Inter-
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est Payment Date. If an Interest Payment Date is not a
Business Day, then such Interest Payment Date and the first day
of the Interest Period commencing on such Interest Payment Date
shall be postponed to the next succeeding Business Day, except if
such Business Day is in the next succeeding calendar month, such
Interest Payment Date and the first day of such Interest Period
will be the immediately preceding Business Day. The term
"interest" as used herein shall include quarterly interest
payments, interest on quarterly interest payments not paid on the
applicable Interest Payment Date (to the extent permitted by law)
and Additional Interest, as applicable.
(c) The per annum rate of interest payable with
respect to the Securities shall equal LIBOR plus _____% (the
"Interest Rate"). The Interest Rate on the Securities for each
Interest Period will be adjusted on the first day of such
Interest Period based on LIBOR determined as of two London
Business Days prior to the first day of such Interest Period
(each, a "Determination Date").
"LIBOR" with respect to any Determination Date will be
determined by the Calculation Agent in accordance with the
following provisions (in the following order of priority):
(1) the rate (expressed as a percentage per
annum) for U.S. dollar deposits having a three-month
maturity that appears on Telerate Page 3750 as of 11:00 a.m.
(London time) on the related Determination Date;
(2) if such rate does not appear on Telerate Page
3750 as of 11:00 a.m. (London time) on the related
Determination Date, LIBOR will be the arithmetic mean (if
necessary rounded upwards to the nearest whole multiple of
0.00001%) of the rates (expressed as percentages per annum)
for U.S. dollar deposits having a three-month maturity that
appear on Reuters Monitor Money Rates Page LIBO ("Reuters
Page LIBO") as of 11:00 a.m. (London time) on such
Determination Date;
(3) if such rate does not appear on Reuters Page
LIBO as of 11:00 a.m. (London time) on the related
Determination Date, the Calculation Agent will request the
principal London offices of four leading banks in the London
interbank market to provide such banks' offered quotations
(expressed as percentages per annum) to prime banks in the
London interbank market for U.S. dollar deposits having a
three-month maturity as of 11:00 a.m. (London time) on such
Determination Date and, if at least two quotations are so
provided, LIBOR will be the arithmetic mean (if necessary
rounded upwards to the nearest whole multiple of 0.00001%)
of such quotations;
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(4) if fewer than two such quotations are
provided as requested in clause (3) above, the Calculation
Agent will request four major New York City banks to provide
such banks' offered quotations (expressed as percentages per
annum) to leading European banks for loans in U.S. dollars
having a three-month maturity as of 11:00 a.m. (London time)
on such Determination Date and, if at least two such
quotations are so provided, LIBOR will be the arithmetic
mean (if necessary rounded upwards to the nearest whole
multiple of 0.00001%) of such quotations; and
(5) if fewer than two such quotations are
provided as requested in clause (4) above, LIBOR will be
LIBOR as determined on the immediately preceding
Determination Date.
If the rate for U.S. dollar deposits having a
three-month maturity that initially appears on Telerate Page 3750
or Reuters Page LIBO, as the case may be, as of 11:00 a.m.
(London time) on the related Determination Date is superseded on
Telerate Page 3750 or Reuters Page LIBO, as the case may be, by a
corrected rate before 12:00 noon (London time) on such
Determination Date, such corrected rate will be the applicable
LIBOR for such Determination Date.
As used herein, "London Business Day" means a day on
which dealings in deposits in U.S. dollars are transacted in the
London interbank market.
The Calculation Agent will, upon the request of any
Securityholder, provide the Interest Rate then in effect. Absent
manifest error, the Calculation Agent's determination of LIBOR
and its calculation of the applicable Interest Rate will be final
and binding on the holders of the Securities.
All percentages resulting from any calculation of
interest on the Securities will be rounded to the nearest one
hundred-thousandth of a percentage point, with five
one-millionths of a percentage point rounded upward (e.g.,
5.687665% (or .05687665) would be rounded to 5.68767% (or
.0568767)), and all dollar amounts used or resulting from such
calculation will be rounded to the nearest cent (with one-half
cent being rounded upward).
The Interest Rate on the Securities will in no event be
higher than the maximum rate permitted by New York law, as the
same may be modified by United States law of general application.
(d) During such time as the Property Trustee is the
holder of any Securities, the Company shall pay any additional
amounts on the Securities as may be necessary in order that the
amount of distributions then due and payable by the Trust on the
outstanding Trust Securities shall not be reduced as a result of
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any additional taxes, duties and other governmental charges to
which the Trust has become subject as a result of a Tax Event
("Additional Interest").
(e) The Company hereby appoints The Bank of New York
as the Calculation Agent with respect to the Securities to be
issued by the Company. The Bank of New York hereby accepts its
appointment to determine LIBOR and calculate the Interest Rate
of, and the amount of interest payable on, the Securities for
each Interest Period pursuant to the terms set forth herein and
in the Securities.
In the event of a resignation or removal of The Bank of
New York as the Calculation Agent, the Company shall promptly
appoint a successor Calculation Agent. Such successor
Calculation Agent shall, without any further act, deed or
conveyance, become vested with all of the authority, rights,
duties and obligations of the Calculation Agent with the like
effect as if originally appointed as Calculation Agent.
SECTION 2.07. Transfer and Exchange.
(a) [Reserved].
(b) The Company shall cause to be kept at the
principal office of the Trustee a register in which, subject to
such reasonable regulations as it may prescribe, the Company
shall provide for the registration of Securities and of transfers
of Securities. Such register is herein sometimes referred to as
the "Securities Register."
To permit registrations of transfers and exchanges, the
Company shall execute and the Trustee shall authenticate
Definitive Securities and Global Securities at the Trustee's
request. All Definitive Securities and Global Securities issued
upon any registration of transfer or exchange of Definitive
Securities or Global Securities shall be the valid obligations of
the Company, evidencing the same debt, and entitled to the same
benefits under this Indenture, as the Definitive Securities or
Global Securities surrendered upon such registration of transfer
or exchange.
No service charge shall be made to a holder for any
registration of transfer or exchange, but the Company may require
payment of a sum sufficient to cover any transfer tax or similar
governmental charge payable in connection therewith.
The Company shall not be required to (i) issue,
register the transfer of or exchange Securities during a period
beginning at the opening of business 15 days before the day of
mailing of a notice of redemption or any notice of selection of
Securities for redemption under Article XV hereof and ending at
the close of business on the day of such mailing; or (ii) regis-
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ter the transfer of or exchange any Security so selected for
redemption in whole or in part, except the unredeemed portion of
any Security being redeemed in part.
Prior to due presentment for the registration of a
transfer of any Security, the Trustee, any Agent and the Company
may deem and treat the Person in whose name any Security is
registered as the absolute owner of such Security for the purpose
of receiving payment of principal of and premium, if any, and
interest on such Securities, and neither the Trustee, any Agent
nor the Company shall be affected by notice to the contrary.
SECTION 2.08. Replacement Securities.
If any mutilated Security is surrendered to the
Trustee, or the Company and the Trustee receive evidence to their
satisfaction of the destruction, loss or theft of any Security,
the Company shall issue and the Trustee shall authenticate a
replacement Security if the Trustee's requirements for
replacements of Securities are met. An indemnity bond must be
supplied by the holder that is sufficient in the judgment of the
Trustee and the Company to protect the Company, the Trustee, any
Agent or any authenticating agent from any loss that any of them
may suffer if a Security is replaced. The Company or the Trustee
may charge for its expenses in replacing a Security.
Every replacement Security is an obligation of the
Company and shall be entitled to all of the benefits of this
Indenture equally and proportionately with all other Securities
duly issued hereunder.
SECTION 2.09. Treasury Securities.
In determining whether the holders of the required
principal amount of Securities have concurred in any direction,
waiver or consent, Securities owned by the Company or any
Affiliate of the Company shall be considered as though not
outstanding, except that for purposes of determining whether the
Trustee shall be protected in relying on any such direction,
waiver or consent, only Securities that a Responsible Officer of
the Trustee actually knows to be so owned shall be so considered.
SECTION 2.10. Temporary Securities.
Pending the preparation of Definitive Securities, the
Company may execute, and upon Company Order the Trustee shall
authenticate and make available for delivery, temporary
Securities that are printed, lithographed, typewritten,
mimeographed or otherwise reproduced, in any authorized
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
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Securities may determine, as conclusively evidenced by their
execution of such Securities.
If temporary Securities are issued, the Company shall
cause Definitive Securities to be prepared without unreasonable
delay. The Definitive Securities shall be printed, lithographed
or engraved, or provided by any combination thereof, or in any
other manner permitted by the rules and regulations of any
applicable securities exchange or interdealer quotation system,
all as determined by the officers executing such Definitive
Securities. 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 maintained by the Company for such purpose
pursuant to Section 3.02 hereof, without charge to the holder.
Upon surrender for cancellation of any one or more temporary
Securities, the Company shall execute, and the Trustee shall
authenticate and make available for delivery, in exchange
therefor the same aggregate principal amount of Definitive
Securities of authorized denominations. Until so exchanged, the
temporary Securities shall in all respects be entitled to the
same benefits under this Indenture as Definitive Securities.
SECTION 2.11. Cancellation.
The Company at any time may deliver Securities to the
Trustee for cancellation. The Trustee and no one else shall
cancel all Securities surrendered for registration of transfer,
exchange, payment, replacement or cancellation and shall retain
or destroy cancelled Securities in accordance with its normal
practices (subject to the record retention requirement of the
Exchange Act) unless the Company directs them to be returned to
it. The Company may not issue new Securities to replace
Securities that have been redeemed or paid or that have been
delivered to the Trustee for cancellation. All cancelled
Securities held by the Trustee shall be delivered to the Company.
SECTION 2.12. Defaulted Interest.
Any interest on any Security that is payable, but is
not punctually paid or duly provided for, on any Interest Payment
Date (herein called "Defaulted Interest") shall forthwith cease
to be payable to the holder on the relevant regular record date
by virtue of having been such holder; and such Defaulted Interest
shall be paid by the Company, at its election, as provided in
clause (a) or clause (b) below:
(a) The Company may make payment of any Defaulted
Interest on Securities to the Persons in whose names such
Securities (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
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fixed in the following manner: the Company shall notify the
Trustee in writing of the amount of Defaulted Interest
proposed to be paid on each such Security and the date of
the proposed payment, and at the same time the Company 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 not be more than 15
nor 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 Company of such special record
date and, in the name and at the expense of the Company,
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 Securityholder at his
or her address as it appears in the Security Register, not
less than 10 days prior to 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 such Securities (or their respective
Predecessor Securities) are registered on such special
record date and shall be no longer payable pursuant to the
following clause (b).
(b) The Company may make payment of any Defaulted
Interest on any Securities in any other lawful manner not
inconsistent with the requirements of any securities
exchange or interdealer quotation system on which such
Securities may be listed, and upon such notice as may be
required by such exchange or interdealer quotation system,
if, after notice given by the Company to the Trustees of the
proposed payment pursuant to this clause, such manner of
payment shall be deemed practicable by the Trustee.
SECTION 2.13. CUSIP Numbers.
The Company 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 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 Securities or as contained in any notice
of a redemption 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
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such numbers. The Company will promptly notify the Trustee of
any change in the CUSIP numbers.
ARTICLE III
PARTICULAR COVENANTS OF THE COMPANY
SECTION 3.01. Payment of Principal, Premium and
Interest.
The Company covenants and agrees for the benefit of the
holders of the Securities that it will duly and punctually pay or
cause to be paid the principal of and premium, if any, and
interest on the Securities at the place, at the respective times
and in the manner provided herein.
SECTION 3.02. Offices for Notices and Payments, etc.
So long as any of the Securities remains outstanding,
the Company will maintain in the Borough of Manhattan, The City
of New York, an office or agency where the Securities may be
presented for payment, an office or agency where the Securities
may be presented for registration of transfer and for exchange as
in this Indenture provided and an office or agency where notices
and demands to or upon the Company in respect of the Securities
or of this Indenture may be served. The Company will give to the
Trustee written notice of the location of any such office or
agency and of any change of location thereof. Until otherwise
designated from time to time by the Company in a notice to the
Trustee, any such office or agency for all of the above purposes
shall be the office or agency of the Trustee. In case the
Company shall fail to maintain any such office or agency in the
Borough of Manhattan, The City of New York, or shall fail to give
such notice of the location or of any change in the location
thereof, presentations and demands may be made and notices may be
served at the principal corporate trust office of the Trustee.
In addition to any such office or agency, the Company
may from time to time designate one or more offices or agencies
outside the Borough of Manhattan, The City of New York, where the
Securities may be presented for registration of transfer and for
exchange in the manner provided in this Indenture, and the
Company may from time to time rescind such designation, as the
Company may deem desirable or expedient; provided, however, that
no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain any such office or agency
in the Borough of Manhattan, The City of New York, for the
purposes above mentioned. The Company will give to the Trustee
prompt written notice of any such designation or rescission
thereof.
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SECTION 3.03. Appointments to Fill Vacancies in
Trustee's Office.
The Company, whenever necessary to avoid or fill a
vacancy in the office of Trustee, will appoint, in the manner
provided in Section 6.10, a Trustee, so that there shall at all
times be a Trustee hereunder.
SECTION 3.04. Provision as to Paying Agent.
(a) If the Company shall appoint a paying agent other
than the Trustee with respect to the Securities,
it will cause such paying agent to execute and
deliver to the Trustee an instrument in which such
agent shall agree with the Trustee, subject to the
provision of this Section 3.04,
(1) that it will hold all sums held by it as such
agent for the payment of the principal of and
premium, if any, or interest on the
Securities (whether such sums have been paid
to it by the Company or by any other obligor
on the Securities) in trust for the benefit
of the holders of the Securities; and
(2) that it will give the Trustee notice of any
failure by the Company (or by any other
obligor on the Securities) to make any
payment of the principal of and premium or
interest on the Securities when the same
shall be due and payable.
(b) If the Company shall act as its own paying agent,
it will, on or before each due date of the
principal of and premium, if any, or interest on
the Securities, set aside, segregate and hold in
trust for the benefit of the holders of the
Securities a sum sufficient to pay such principal,
premium or interest so becoming due and will
notify the Trustee of any failure to take such
action and of any failure by the Company (or by
any other obligor under the Securities) to make
any payment of the principal of and premium, if
any, or interest on the Securities when the same
shall become due and payable.
(c) Anything in this Section 3.04 to the contrary
notwithstanding, the Company may, at any time, for
the purpose of obtaining a satisfaction and
discharge with respect to the Securities
hereunder, or for any other reason, pay or cause
to be paid to the Trustee all sums held in trust
for any such
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Securities by the Trustee or any paying agent hereunder,
as required by this Section 3.04, such sums to be held
by the Trustee upon the trusts herein contained.
(d) Anything in this Section 3.04 to the contrary
notwithstanding, the agreement to hold sums in
trust as provided in this Section 3.04 is subject
to Sections 11.03 and 11.04.
SECTION 3.05. Certificate to Trustee.
The Company will deliver to the Trustee on or before
120 days after the end of each fiscal year in each year,
commencing with the first fiscal year ending after the date
hereof, so long as Securities are outstanding hereunder, an
Officers' Certificate, one of the signers of which shall be the
principal executive, principal financial or principal accounting
officer of the Company stating that in the course of the
performance by the signers of their duties as officers of the
Company they would normally have knowledge of any default by the
Company in the performance of any covenants contained herein,
stating whether or not they have knowledge of any such default
and, if so, specifying each such default of which the signers
have knowledge and the nature thereof.
SECTION 3.06. Compliance with Consolidation
Provisions.
The Company will not, while any of the Securities
remain outstanding, consolidate with, or merge into, or merge
into itself, or sell or convey all or substantially all of its
property to any other Person unless the provisions of Article X
hereof are complied with.
SECTION 3.07. Limitation on Dividends.
The Company will not (i) declare or pay any dividends
or distributions on, or redeem, purchase, acquire, or make a
liquidation payment with respect to, any of the Company's capital
stock (which includes common and preferred stock) or (ii) make
any payment of principal, interest or premium, if any, on or
repay or repurchase or redeem any debt securities of the Company
(including any Other Debentures) that rank pari passu with or
junior in right of payment to the Securities or (iii) make any
guarantee payments with respect to any guarantee by the Company
of the debt securities of any Subsidiary of the Company
(including Other Guarantees) if such guarantee ranks pari passu
or junior in right of payment to the Securities (other than (a)
dividends or distributions in shares of, or options, warrants or
rights to subscribe for or purchase shares of, Common Stock of
the Company, (b) any declaration of a dividend in connection with
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the implementation of a stockholder's 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 Capital Securities Guarantee and (d) as a
result of a reclassification of the Company's capital stock or
the exchange or the conversion of one class or series of the
Company's capital stock for another class or series of the
Company's capital stock; (e) the purchase of fractional interests
in shares of the Company's capital stock pursuant to the
conversion or exchange provisions of such capital stock or the
security being converted or exchanged; and (f) purchases of
Common Stock related to the issuance of Common Stock or rights
under any of the Company's benefit plans for its directors,
officers or employees or any of the Company's dividend
reinvestment plans) if at such time (i) there shall have occurred
any event of which the Company has actual knowledge that (a) with
the giving of notice or the lapse of time, or both, would
constitute an Event of Default and (b) in respect of which the
Company shall not have taken reasonable steps to cure, (ii) if
such Securities are held by the Property Trustee, the Company
shall be in default with respect to its payment of any
obligations under the Capital Securities Guarantee or (iii) the
Company shall have given notice of its election of the exercise
of its right to extend the interest payment period pursuant to
Section 16.01 and any such extension shall be continuing.
SECTION 3.08. Covenants as to the Trust
In the event Securities are issued to the Trust or a
trustee of such trust in connection with the issuance of Trust
Securities by the Trust, for so long as such Trust Securities
remain outstanding, the Company will (i) maintain 100% direct
ownership of the Common Securities of the Trust; provided,
however, that any successor of the Company, permitted pursuant to
Article X, may succeed to the Company's ownership of such Common
Securities, (ii) use its reasonable efforts to cause the Trust
(a) to remain a business trust, except in connection with a
distribution of Securities, the redemption of all of the Trust
Securities of the Trust or certain mergers, consolidations or
amalgamations, each as permitted by the Declaration of the Trust,
and (b) to otherwise continue to be treated as a grantor trust
and not an association taxable as a corporation for United States
Federal income tax purposes and (iii) to use its reasonable
efforts to cause each holder of Trust Securities to be treated as
owning an individual beneficial interest in the Securities.
SECTION 3.09. Payment of Expenses.
In connection with the offering, sale and issuance of
the Securities to the Trust and in connection with the sale of
the Trust Securities by the Trust, the Company, in its capacity
as borrower with respect to the Securities, shall:
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(a) pay all costs and expenses relating to the
offering, sale and issuance of the Securities, including
commissions to the initial purchasers payable pursuant to the
Purchase Agreement, fees and expenses in connection with the
registration of the Securities under the Securities Act and
compensation of the Trustee in accordance with the provisions of
Section 6.06;
(b) pay all costs and expenses of the Trust
(including, but not limited to, costs and expenses relating to
the organization of the Trust, the offering, sale and issuance of
the Trust Securities (including commissions to the initial
purchasers in connection therewith), the fees and expenses of the
Property Trustee and the Delaware Trustee, the costs and expenses
relating to the operation of the Trust, including without
limitation, costs and expenses of accountants, attorneys,
statistical or bookkeeping services, expenses for printing and
engraving and computing or accounting equipment, paying agent(s),
registrar(s), transfer agent(s), duplicating, travel and
telephone and other telecommunications expenses and costs and
expenses incurred in connection with the acquisition, financing,
and disposition of Trust assets;
(c) be primarily and fully liable for any
indemnification obligations arising with respect to the
Declaration;
(d) pay any and all taxes (other than United States
withholding taxes attributable to the Trust or its assets) and
all liabilities, costs and expenses with respect to such taxes of
the Trust; and
(e) pay all other fees, expenses, debts and
obligations (other than the Trust Securities) related to the
Trust.
SECTION 3.10. Payment Upon Resignation or Removal.
Upon termination of this Indenture or the removal or
resignation of the Trustee, unless otherwise stated, the Company
shall pay to the Trustee all amounts accrued and owing to the
date of such termination, removal or resignation. Upon
termination of the Declaration or the removal or resignation of
the Delaware Trustee or the Property Trustee, as the case may be,
pursuant to Section 5.7 of the Declaration, the Company shall pay
to the Delaware Trustee or the Property Trustee, as the case may
be, all amounts accrued and owing to the date of such
termination, removal or resignation.
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ARTICLE IV
SECURITYHOLDERS' LISTS AND REPORTS BY THE
COMPANY AND THE TRUSTEE
SECTION 4.01. Securityholders' Lists.
The Company covenants and agrees that it will furnish
or cause to be furnished to the Trustee:
(a) on a semi-annual basis on November 15 and May 15
of each year, a list, in such form as the Trustee
may reasonably require, of the names and addresses
of the Securityholders as of such record date; and
(b) at such other times as the Trustee may request in
writing, within 30 days after the receipt by the
Company, 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,
except that, no such lists need be furnished so
long as the Trustee is in possession thereof by
reason of its acting as Security registrar.
SECTION 4.02. Preservation and Disclosure of Lists.
(a) The Trustee shall preserve, in as current a form
as is reasonably practicable, all information as
to the names and addresses of the holders of the
Securities (1) contained in the most recent list
furnished to it as provided in Section 4.01 or (2)
received by it in the capacity of Securities
registrar (if so acting) hereunder. The Trustee
may destroy any list furnished to it as provided
in Section 4.01 upon receipt of a new list so
furnished.
(b) In case three or more holders of Securities
(hereinafter referred to as "applicants") apply in
writing to the Trustee and furnish to the Trustee
reasonable proof that each such applicant has
owned a Security for a period of at least six
months preceding the date of such application, and
such application states that the applicants desire
to communicate with other holders of Securities or
with holders of all Securities with respect to
their rights under this Indenture and is
accompanied by a copy of the form of proxy or
other communication which such applicants propose
to transmit, then the Trustee shall within 5
Business Days after the receipt of such
application, at its election, either:
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(1) afford such applicants access to the information
preserved at the time by the Trustee in accordance
with the provisions of subsection (a) of this
Section 4.02, or
(2) inform such applicants as to the approximate
number of holders of all Securities, whose names
and addresses appear in the information preserved
at the time by the Trustee in accordance with the
provisions of subsection (a) of this Section 4.02,
and as to the approximate cost of mailing to such
Securityholders the form of proxy or other
communication, if any, specified in such
application.
If the Trustee shall elect not to afford such
applicants access to such information, the Trustee
shall, upon the written request of such
applicants, mail to each Securityholder whose name
and address appear in the information preserved at
the time by the Trustee in accordance with the
provisions of subsection (a) of this Section 4.02
a copy of the form of proxy or other communication
which is specified in such request with reasonable
promptness after a tender to the Trustee of the
material to be mailed and of payment, or provision
for the payment, of the reasonable expenses of
mailing, unless within five days after such
tender, the Trustee shall mail to such applicants
and file with the Commission, together with a copy
of the material to be mailed, a written statement
to the effect that, in the opinion of the Trustee,
such mailing would be contrary to the best
interests of the holders of Securities or would be
in violation of applicable law. Such written
statement shall specify the basis of such opinion.
If the Commission, after opportunity for a hearing
upon the objections specified in the written
statement so filed, shall enter an order refusing
to sustain any of such objections or if, after the
entry of an order sustaining one or more of such
objections, the Commission shall find, after
notice and opportunity for hearing, that all the
objections so sustained have been met and shall
enter an order so declaring, the Trustee shall
mail copies of such material to all such
Securityholders with reasonable promptness after
the entry of such order and the renewal of such
tender; otherwise the Trustee shall be relieved of
any obligation or duty to such applicants
respecting their application.
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(c) Each and every holder of Securities, by receiving
and holding the same, agrees with the Company and
the Trustee that neither the Company nor the
Trustee nor any paying agent shall be held
accountable by reason of the disclosure of any
such information as to the names and addresses of
the holders of Securities in accordance with the
provisions of subsection (b) of this Section 4.02,
regardless of the source from which such
information was derived, and that the Trustee
shall not be held accountable by reason of mailing
any material pursuant to a request made under said
subsection (b).
SECTION 4.03. Reports by Company.
(a) The Company covenants and agrees to file with the
Trustee, within 15 days after the date on which
the Company is required to file the same with the
Commission, copies of the annual reports and of
the information, documents and other reports (or
copies of such portions of any of the foregoing as
said Commission may from time to time by rules and
regulations prescribe) which the Company may be
required to file with the Commission pursuant to
Section 13 or Section 15(d) of the Exchange Act;
or, if the Company is not required to file
information, documents or reports pursuant to
either of such sections, then to file with the
Trustee and the Commission, in accordance with
rules and regulations prescribed from time to time
by the Commission, such of the supplementary and
periodic information, documents and reports which
may be required pursuant to Section 13 of the
Exchange Act in respect of a security listed and
registered on a national securities exchange as
may be prescribed from time to time in such rules
and regulations.
(b) The Company covenants and agrees to file with the
Trustee and the Commission, in accordance with the
rules and regulations prescribed from time to time
by said Commission, such additional information,
documents and reports with respect to compliance
by the Company with the conditions and covenants
provided for in this Indenture as may be required
from time to time by such rules and regulations.
(c) The Company covenants and agrees to transmit by
mail to all holders of Securities, as the names
and addresses of such holders appear upon the
Security Register, within 30 days after the filing
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thereof with the Trustee, such summaries of any
information, documents and reports required to be
filed by the Company pursuant to subsections (a)
and (b) of this Section 4.03 as may be required by
rules and regulations prescribed from time to time
by the Commission.
(d) Delivery of such reports, information and
documents to the Trustee is for informational
purposes only and the Trustee's receipt of such
shall not constitute constructive notice of any
information contained therein or determinable from
information contained therein, including the
Company's compliance with any of its covenants
hereunder (as to which the Trustee is entitled to
rely exclusively on Officers' Certificates).
SECTION 4.04. Reports by the Trustee.
(a) The Trustee shall transmit to Securityholders 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. If required by
Section 313(a) of the Trust Indenture Act, the
Trustee shall, within sixty days after each
December 15 following the date of this Indenture,
commencing December 15, 1997, deliver to
Securityholders a brief report, dated as of such
December 15, which complies with the provisions of
such Section 313(a).
(b) A copy of each such report shall, at the time of
such transmission to Securityholders, be filed by
the Trustee with each stock exchange, if any, upon
which the Securities are listed, with the
Commission and with the Company. The Company will
promptly notify the Trustee when the Securities
are listed on any stock exchange.
ARTICLE V
REMEDIES OF THE TRUSTEE AND SECURITYHOLDERS
ON EVENT OF DEFAULT
SECTION 5.01. Events of Default.
One or more of the following events of default shall
constitute an Event of Default hereunder:
(a) default in the payment of any interest upon any
Security or any Other Debentures when it becomes
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due and payable, and continuance of such default
for a period of 30 days; provided, however, that a
valid extension of an interest payment period by
the Company in accordance with the terms hereof or
thereof shall not constitute a default in the
payment of interest for this purpose; or
(b) default in the payment of all or any part of the
principal of (or premium, if any, on) any Security
or any Other Debentures as and when the same shall
become due and payable, whether at maturity, upon
redemption, by declaration or otherwise; or
(c) default in the performance, or breach, of any
covenant or warranty of the Company in this
Indenture (other than a covenant or warranty a
default in whose performance or whose breach 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
Company by the Trustee or to the Company and the
Trustee by the holders of at least 25% in
aggregate principal amount of the outstanding
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
(d) a court having jurisdiction in the premises shall
enter a decree or order for relief in respect of
the Company in an involuntary case under any
applicable bankruptcy, insolvency or other similar
law now or hereafter in effect, or appointing a
receiver, liquidator, assignee, custodian,
trustee, sequestrator (or similar official) of the
Company or for any substantial part of its
property, or ordering the winding-up or
liquidation of its affairs and such decree or
order shall remain unstayed and in effect for a
period of 90 consecutive days; or
(e) the Company shall commence a voluntary case under
any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect, shall
consent to the entry of an order for relief in an
involuntary case under any such law, or shall
consent to the appointment of or taking possession
by a receiver, liquidator, assignee, trustee,
custodian, sequestrator (or other similar
official) of the Company or of any substantial
part of its property, or shall make any general
assignment
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for the benefit of creditors, or shall fail
generally to pay its debts as they become due.
If an Event of Default with respect to Securities at
the time outstanding occurs and is continuing, then in every such
case the Trustee or the holders of not less than 25% in aggregate
principal amount of the Securities then outstanding may declare
the principal amount of all Securities to be due and payable
immediately, by a notice in writing to the Company (and to the
Trustee if given by the holders of the outstanding Securities),
and upon any such declaration the same shall become immediately
due and payable.
The foregoing provisions, however, are subject to the
condition that if, at any time after the principal of the
Securities shall have been so declared due and payable, and
before any judgment or decree for the payment of the moneys due
shall have been obtained or entered as hereinafter provided, (i)
the Company shall pay or shall deposit with the Trustee a sum
sufficient to pay (A) all matured installments of interest upon
all the Securities and the principal of and premium, if any, on
any and all Securities which shall have become due otherwise than
by acceleration (with interest upon such principal and premium,
if any, and, to the extent that payment of such interest is
enforceable under applicable law, on overdue installments of
interest, at the same rate as the rate of interest specified in
the Securities to the date of such payment or deposit) and (B)
such amount as shall be sufficient to cover reasonable
compensation to the Trustee and each predecessor Trustee, their
respective agents, attorneys and counsel, and all other expenses
and liabilities incurred, and all advances made, by the Trustee
and each predecessor Trustee except as a result of negligence or
bad faith, and (ii) any and all Events of Default under the
Indenture shall have been cured, waived or otherwise remedied as
provided herein, then, in every such case, the holders of a
majority in aggregate principal amount of the Securities then
outstanding, by written notice to the Company and to the Trustee,
may rescind and annul such declaration and its consequences, but
no such waiver or rescission and annulment shall extend to or
shall affect any subsequent default or shall impair any right
consequent thereon.
In case the Trustee shall have proceeded to enforce any
right under this Indenture and such proceedings shall have been
discontinued or abandoned because of such rescission or annulment
or for any other reason or shall have been determined adversely
to the Trustee, then and in every such case the Company, the
Trustee and the holders of the Securities shall be restored
respectively to their several positions and rights hereunder, and
all rights, remedies and powers of the Company, the Trustee and
the holders of the Securities shall continue as though no such
proceeding had been taken.
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SECTION 5.02. Payment of Securities on Default; Suit
Therefor.
The Company covenants that (a) in case default shall be
made in the payment of any installment of interest upon any of
the Securities as and when the same shall become due and payable,
and such default shall have continued for a period of 30 days, or
(b) in case default shall be made in the payment of the principal
of or premium, if any, on any of the Securities as and when the
same shall have become due and payable, whether at maturity of
the Securities or upon redemption or by declaration or otherwise,
then, upon demand of the Trustee, the Company will pay to the
Trustee, for the benefit of the holders of the Securities, the
whole amount that then shall have become due and payable on all
such Securities for principal and premium, if any, or interest,
or both, as the case may be, with interest upon the overdue
principal and premium, if any, and (to the extent that payment of
such interest is enforceable under applicable law and, if the
Securities are held by the Trust or a trustee of such trust,
without duplication of any other amounts paid by the Trust or
trustee in respect thereof) upon the overdue installments of
interest at the rate borne by the Securities; and, in addition
thereto, such further amount as shall be sufficient to cover the
costs and expenses of collection, including a reasonable
compensation to the Trustee, its agents, attorneys and counsel,
and any expenses or liabilities incurred by the Trustee hereunder
other than through its negligence or bad faith.
In case the Company shall fail forthwith to pay such
amounts upon such demand, the Trustee, in its own name and as
trustee of an express trust, shall be entitled and empowered to
institute any actions or proceedings at law or in equity for the
collection of the sums so due and unpaid, and may prosecute any
such action or proceeding to judgment or final decree, and may
enforce any such judgment or final decree against the Company or
any other obligor on the Securities and collect in the manner
provided by law out of the property of the Company or any other
obligor on the Securities wherever situated the moneys adjudged
or decreed to be payable.
In case there shall be pending proceedings for the
bankruptcy or for the reorganization of the Company or any other
obligor on the Securities under Title 11, United States Code, or
any other applicable law, or in case a receiver or trustee shall
have been appointed for the property of the Company or such other
obligor, or in the case of any other similar judicial proceedings
relative to the Company or other obligor upon the Securities, or
to the creditors or property of the Company or such other
obligor, 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 pursuant to the provisions of
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this Section 5.02, shall be entitled and empowered, by
intervention in such proceedings or otherwise, to file and prove
a claim or claims for the whole amount of principal and interest
owing and unpaid in respect of the Securities and, in case of any
judicial proceedings, to file such proofs of claim and other
papers or documents as may be necessary or advisable in order to
have the claims of the Trustee (including any claim for
reasonable compensation to the Trustee and each predecessor
Trustee, and their respective agents, attorneys and counsel, and
for reimbursement of all expenses and liabilities incurred, and
all advances made, by the Trustee and each predecessor Trustee,
except as a result of negligence or bad faith) and of the
Securityholders allowed in such judicial proceedings relative to
the Company or any other obligor on the Securities, or to the
creditors or property of the Company or such other obligor,
unless prohibited by applicable law and regulations, to vote on
behalf of the holders of the Securities in any election of a
trustee or a standby trustee in arrangement, reorganization,
liquidation or other bankruptcy or insolvency proceedings or
person performing similar functions in comparable proceedings,
and to collect and receive any moneys or other property payable
or deliverable on any such claims, and to distribute the same
after the deduction of its charges and expenses; and any
receiver, assignee or trustee in bankruptcy or reorganization is
hereby authorized by each of the Securityholders to make such
payments to the Trustee, and, in the event that the Trustee shall
consent to the making of such payments directly to the
Securityholders, to pay to the Trustee such amounts as shall be
sufficient to cover reasonable compensation to the Trustee, each
predecessor Trustee and their respective agents, attorneys and
counsel, and all other expenses and liabilities incurred, and all
advances made, by the Trustee and each predecessor Trustee except
as a result of negligence or bad faith.
Nothing herein contained shall be construed to
authorize the Trustee to authorize or consent to or accept or
adopt on behalf of any Securityholder 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 Securityholder in any such
proceeding.
All rights of action and of asserting claims under this
Indenture, or under any of the Securities, may be enforced by the
Trustee without the possession of any of the Securities, or the
production thereof on any trial or other proceeding relative
thereto, and any such suit or proceeding instituted by the
Trustee shall be brought in its own name as trustee of an express
trust, and any recovery of judgment shall be for the ratable
benefit of the holders of the Securities.
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In any proceedings brought by the Trustee (and also any
proceedings involving the interpretation of any provision of this
Indenture to which the Trustee shall be a party) the Trustee
shall be held to represent all the holders of the Securities, and
it shall not be necessary to make any holders of the Securities
parties to any such proceedings.
SECTION 5.03. Application of Moneys Collected by
Trustee.
Any moneys collected by the Trustee shall be applied in
the order following, at the date or dates fixed by the Trustee
for the distribution of such moneys, upon presentation of the
Securities in respect of which moneys have been collected, and
stamping thereon the payment, if only partially paid, and upon
surrender thereof if fully paid:
First: To the payment of costs and expenses of
collection applicable to the Securities and reasonable
compensation to the Trustee, its agents, attorneys and counsel,
and of all other expenses and liabilities incurred, and all
advances made, by the Trustee except as a result of its
negligence or bad faith;
Second: To the payment of all Senior Indebtedness of
the Company if and to the extent required by Article XV;
Third: To the payment of the amounts then due and
unpaid upon Securities for principal of (and premium, if any) and
interest on the Securities, in respect of which or for the
benefit of which money has been collected, ratably, without
preference of priority of any kind, according to the amounts due
on such Securities for principal (and premium, if any) and
interest, respectively; and
Fourth: To the Company.
SECTION 5.04. Proceedings by Securityholders.
No holder of any Security shall have any right by
virtue of or by availing of any provision of this Indenture to
institute any suit, action or proceeding in equity or at law upon
or under or with respect to this Indenture or for the appointment
of a receiver or trustee, or for any other remedy hereunder,
unless such holder previously shall have given to the Trustee
written notice of an Event of Default and of the continuance
thereof with respect to the Securities specifying such Event of
Default, as hereinbefore provided, and unless also the holders of
not less than 25% in aggregate principal amount of the Securities
then outstanding shall have made written request upon the Trustee
to institute such action, suit or proceeding in its own name as
Trustee hereunder and shall have offered to the Trustee such
reasonable indemnity as it may require against the costs, expens-
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es and liabilities to be incurred therein or thereby, and
the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity shall have failed to institute any such
action, suit or proceeding, it being understood and intended, and
being expressly covenanted by the taker and holder of every
Security with every other taker and holder and the Trustee, that
no one or more holders of Securities shall have any right in any
manner whatever by virtue of or by availing of any provision of
this Indenture to affect, disturb or prejudice the rights of any
other holder of Securities, or to obtain or seek to obtain
priority over or preference to any other such holder, or to
enforce any right under this Indenture, except in the manner
herein provided and for the equal, ratable and common benefit of
all holders of Securities.
Notwithstanding any other provisions in this Indenture,
however, the right of any holder of any Security to receive
payment of the principal of (premium, if any) and interest on
such Security, on or after the same shall have become due and
payable, or to institute suit for the enforcement of any such
payment, shall not be impaired or affected without the consent of
such holder and by accepting a Security hereunder it is expressly
understood, intended and covenanted by the taker and holder of
every Security with every other such taker and holder and the
Trustee, that no one or more holders of Securities shall have any
right in any manner whatsoever by virtue or by availing of any
provision of this Indenture to affect, disturb or prejudice the
rights of the holders of any other Securities, or to obtain or
seek to obtain priority over or preference to any other such
holder, or to enforce any right under this Indenture, except in
the manner herein provided and for the equal, ratable and common
benefit of all holders of Securities. For the protection and
enforcement of the provisions of this Section, each and every
Securityholder and the Trustee shall be entitled to such relief
as can be given either at law or in equity.
The Company and the Trustee acknowledge that pursuant
to the Declaration, the holders of Capital Securities are
entitled, in the circumstances and subject to the limitations set
forth therein, to commence a Direct Action with respect to any
Event of Default under this Indenture and the Securities.
SECTION 5.05. Proceedings by Trustee.
In case an Event of Default occurs with respect to
Securities and is continuing, the Trustee may in its discretion
proceed to protect and enforce the rights vested in it by this
Indenture by such appropriate judicial proceedings as the Trustee
shall deem most effectual to protect and enforce any of such
rights, either by suit in equity or by action at law or by
proceeding in bankruptcy or otherwise, whether for the specific
enforcement of any covenant or agreement contained in this
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Indenture or in aid of the exercise of any power granted in this
Indenture, or to enforce any other legal or equitable right
vested in the Trustee by this Indenture or by law.
SECTION 5.06. Remedies Cumulative and Continuing.
All powers and remedies given by this Article V to the
Trustee or to the Securityholders shall, to the extent permitted
by law, be deemed cumulative and not exclusive of any other
powers and remedies available to the Trustee or the holders of
the Securities, by judicial proceedings or otherwise, to enforce
the performance or observance of the covenants and agreements
contained in this Indenture or otherwise established with respect
to the Securities, and no delay or omission of the Trustee or of
any holder of any of the Securities to exercise any right or
power accruing upon any Event of Default occurring and continuing
as aforesaid shall impair any such right or power, or shall be
construed to be a waiver of any such default or an acquiescence
therein; and, subject to the provisions of Section 5.04, every
power and remedy given by this Article V or by law to the Trustee
or to the Securityholders may be exercised from time to time, and
as often as shall be deemed expedient, by the Trustee or by the
Securityholders.
SECTION 5.07. Direction of Proceedings and Waiver of
Defaults by Majority of Securityholders.
The holders of a majority in aggregate principal amount
of the Securities at the time outstanding 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; provided, however, that
(subject to the provisions of Section 6.01) the Trustee shall
have the right to decline to follow any such direction if the
Trustee shall determine that the action so directed would be
unjustly prejudicial to the holders not taking part in such
direction or if the Trustee being advised by counsel determines
that the action or proceeding so directed may not lawfully be
taken or if the Trustee in good faith by its board of directors
or trustees, executive committee, or a trust committee of
directors or trustees and/or Responsible Officers shall determine
that the action or proceedings so directed would involve the
Trustee in personal liability. Prior to any declaration
accelerating the maturity of the Securities, the holders of a
majority in aggregate principal amount of the Securities at the
time outstanding may on behalf of the holders of all of the
Securities waive any past default or Event of Default and its
consequences except a default (a) in the payment of principal of
or premium, if any, or interest on any of the Securities or (b)
in respect of covenants or provisions hereof which cannot be
modified or amended without the consent of the holder of each
Security affected; provided, however, that if the Securities are
held by Property Trustee,
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such waiver or modification to such waiver shall not be effective until the
holders of a majority in aggregate liquidation amount of Trust Securities
shall have consented to such waiver or modification to such waiver;
provided further, that if the consent of the holder of each outstanding
Security is required, such waiver shall not be effective until each holder
of the Trust Securities shall have consented to such waiver. Upon any such
waiver, the default covered thereby shall be deemed to be cured for all
purposes of this Indenture and the Company, the Trustee and the holders of
the Securities shall be restored to their former positions and rights
hereunder, respectively; but no such waiver shall extend to any subsequent
or other default or impair any right consequent thereon. Whenever any
default or Event of Default hereunder shall have been waived as permitted
by this Section 5.07, said default or Event of Default shall for all
purposes of the Securities and this Indenture be deemed to have been cured
and to be not continuing .
SECTION 5.08. Notice of Defaults.
The Trustee shall, within 90 days after the occurrence
of a default with respect to the Securities mail to all
Securityholders, as the names and addresses of such holders
appear upon the Security register, notice of all defaults known
to the Trustee, unless such defaults shall have been cured before
the giving of such notice (the term "defaults" for the purpose of
this Section 5.08 being hereby defined to be the events specified
in clauses (a), (b), (c), (d) and (e) of Section 5.01, not
including periods of grace, if any, provided for therein, and
irrespective of the giving of written notice specified in clause
(c) of Section 5.01); and provided that, except in the case of
default in the payment of the principal of or premium, if any, or
interest on any of the Securities, 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 Securityholders; and provided further, that in
the case of any default of the character specified in Section
5.01(c) no such notice to Securityholders shall be given until at
least 60 days after the occurrence thereof but shall be given
within 90 days after such occurrence.
SECTION 5.09. Undertaking to Pay 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
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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 5.09 shall not apply to any
suit instituted by the Trustee, to any suit instituted by any
Securityholder, or group of Securityholders, holding in the
aggregate more than 10% in aggregate principal amount of the
Securities outstanding, or to any suit instituted by any
Securityholder for the enforcement of the payment of the
principal of (or premium, if any) or interest on any Security
against the Company on or after the same shall have become due
and payable.
ARTICLE VI
CONCERNING THE TRUSTEE
SECTION 6.01. Duties and Responsibilities of Trustee.
With respect to the holders of the Securities issued
hereunder, the Trustee, prior to the occurrence of an Event of
Default and after the curing or waiving of all Events of Default
which may have occurred, undertakes to perform such duties and
only such duties as are specifically set forth in this Indenture.
In case an Event of Default has occurred (which has not been
cured or waived) 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 man
would exercise or use under the circumstances in the conduct of
his own affairs.
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
(a) prior to the occurrence of an Event of Default and
after the curing or waiving of all Events of
Default which may have occurred
(1) the duties and obligations of the Trustee
shall be determined solely by the express
provisions of this Indenture, and the Trustee
shall not be liable except for the
performance of such duties and obligations as
are specifically set forth in this Indenture,
and no implied covenants or obligations shall
be read into this Indenture against the
Trustee; and
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(2) in the absence of bad faith on the part of
the Trustee, the 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 Trustee and conforming to
the requirements of this Indenture; but, in
the case of any such certificates or opinions
which by any provision 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) the Trustee shall not be liable for any error of
judgment made in good faith by a Responsible
Officer or Officers of the Trustee, unless it
shall be proved that the Trustee was negligent in
ascertaining the pertinent facts; and
(c) 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
the Securityholders pursuant to Section 5.07,
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.
None of the provisions contained in this Indenture
shall require the 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 there is reasonable ground for believing that the
repayment of such funds or liability is not reasonably assured to
it under the terms of this Indenture or adequate indemnity
against such risk is not reasonably assured to it.
SECTION 6.02. Reliance on Documents, Opinions, etc.
Except as otherwise provided in Section 6.01:
(a) the Trustee may conclusively rely and shall be
protected in acting or refraining from acting upon
any resolution, certificate, statement,
instrument, opinion, report, notice, request,
consent, order, bond, note, debenture 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, direction, order or demand of the
Company mentioned herein may be sufficiently
evidenced by an Officers' Certificate (unless
other evidence in respect thereof be herein
specifically prescribed); and any Board Resolution
may be evidenced to the Trustee by a copy thereof
certified by the Clerk or an Assistant Clerk of
the Company;
(c) the Trustee may consult with counsel of its
selection and any advice or Opinion of Counsel
shall be full and complete authorization and
protection in respect of any action taken or
suffered omitted by it hereunder in good faith and
in accordance with such advice or Opinion of
Counsel;
(d) the Trustee shall be under no obligation to
exercise any of the rights or powers vested in it
by this Indenture at the request, order or
direction of any of the Securityholders, pursuant
to the provisions of this Indenture, unless such
Securityholders shall have offered to the Trustee
reasonable security or indemnity against the
costs, expenses and liabilities which may be
incurred therein or thereby;
(e) the Trustee shall not be liable for any action
taken or omitted by it in good faith and believed
by it to be authorized or within the discretion or
rights or powers conferred upon it by this
Indenture; nothing contained herein shall,
however, relieve the Trustee of the obligation,
upon the occurrence of an Event of Default (that
has not been cured or waived), to exercise such of
the rights and powers vested in it by this
Indenture, and to use the same degree of care and
skill in their exercise, as a prudent man would
exercise or use under the circumstances in the
conduct of his own affairs;
(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,
consent, order, approval, bond, debenture, coupon
or other paper or document, unless requested in
writing to do so by the holders of a majority in
aggregate principal amount of the outstanding
Securities; provided, however, that if the payment
within a reasonable time to the Trustee of the
costs, expenses or liabilities likely to be
incurred by it in the making of such investigation
is, in the opinion of the Trustee, not reasonably
assured to the Trustee
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by the security afforded to it by the terms of this
Indenture, the Trustee may require reasonable indemnity
against such expense or liability as a condition to so
proceeding;
(g) the Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder
either directly or by or through agents (including
any Authenticating Agent) or attorneys, and the
Trustee shall not be responsible for any
misconduct or negligence on the part of any such
agent or attorney appointed by it with due care;
(h) 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; and
(i) the Trustee shall not be deemed to have notice of
any Default or Event of Default unless a
responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any
event which is in fact such a default is received
by the Trustee at the Corporate Trust Office of
the Trustee, and such notice references the
Securities and this Indenture.
SECTION 6.03. No Responsibility for Recitals, etc.
The recitals contained herein and in the Securities
(except in the certificate of authentication of the Trustee or
the Authenticating Agent) shall be taken as the statements of the
Company and the Trustee and the Authenticating Agent assume no
responsibility for the correctness of the same. The Trustee and
the Authenticating Agent make no representations as to the
validity or sufficiency of this Indenture or of the Securities.
The Trustee and the Authenticating Agent shall not be accountable
for the use or application by the Company of any Securities or
the proceeds of any Securities authenticated and delivered by the
Trustee or the Authenticating Agent in conformity with the
provisions of this Indenture.
SECTION 6.04. Trustee, Authenticating Agent, Paying
Agents, Transfer Agents or Registrar May
Own Securities.
The Trustee or any Authenticating Agent or any paying
agent or any transfer agent or any Security registrar, in its
individual or any other capacity, may become the owner or pledgee
of Securities with the same rights it would have if it were not
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Trustee, Authenticating Agent, paying agent, transfer agent or
Security registrar.
SECTION 6.05. Moneys to be Held in Trust.
Subject to the provisions of Section 11.04, all moneys
received by the Trustee or any paying agent shall, until used or
applied as herein provided, be held in trust for the purpose for
which they were received, but need not be segregated from other
funds except to the extent required by law. The Trustee and any
paying agent shall be under no liability for interest on any
money received by it hereunder except as otherwise agreed in
writing with the Company. So long as no Event of Default shall
have occurred and be continuing, all interest allowed on any such
moneys shall be paid from time to time upon the written order of
the Company, signed by the Chairman of the Board of Directors,
the President or a Vice President or the Treasurer or an
Assistant Treasurer of the Company.
SECTION 6.06. Compensation and Expenses of Trustee.
The Company, as borrower, covenants and agrees to pay
to the Trustee from time to time, and the Trustee shall be
entitled to, such compensation as shall be agreed to in writing
between the Company and the Trustee (which shall not be limited
by any provision of law in regard to the compensation of a
trustee of an express trust), and the Company will pay or
reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by the
Trustee in accordance with any of the provisions of this
Indenture (including the reasonable compensation and the expenses
and disbursements of its counsel and of all persons not regularly
in its employ) except any such expense, disbursement or advance
as may arise from its negligence or bad faith. The Company also
covenants to indemnify each of the Trustee or any predecessor
Trustee (and its officers, agents, directors and employees) for,
and to hold it harmless against, any and all loss, damage, claim,
liability or expense including taxes (other than taxes based on
the income of the Trustee) incurred without negligence or bad
faith on the part of the Trustee and arising out of or in
connection with the acceptance or administration of this trust,
including the costs and expenses of defending itself against any
claim of liability in the premises. The obligations of the
Company under this Section 6.06 to compensate and indemnify the
Trustee and to pay or reimburse the Trustee for expenses,
disbursements and advances shall constitute additional
indebtedness hereunder. Such additional indebtedness shall be
secured by a lien prior to that of the Securities upon all
property and funds held or collected by the Trustee as such,
except funds held in trust for the benefit of the holders of
particular Securities.
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When the Trustee incurs expenses or renders services in
connection with an Event of Default specified in Section 5.01(d)
or Section 5.01(e), 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
other similar law.
The provisions of this Section shall survive the
termination of this Indenture.
SECTION 6.07. Officers' Certificate as Evidence.
Except as otherwise provided in Sections 6.01 and 6.02,
whenever in the administration of the provisions of this
Indenture the Trustee shall deem it necessary or desirable that a
matter be proved or established prior to taking or omitting any
action hereunder, such matter (unless other evidence in respect
thereof is herein specifically prescribed) may, in the absence of
negligence or bad faith on the part of the Trustee, be deemed to
be conclusively proved and established by an Officers'
Certificate delivered to the Trustee, and such certificate, in
the absence of negligence or bad faith on the part of the
Trustee, shall be full warrant to the Trustee for any action
taken or omitted by it under the provisions of this Indenture
upon the faith thereof.
SECTION 6.08. Conflicting Interest of Trustee.
If the Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust
Indenture Act, the Trustee and the Company shall in all respects
comply with the provisions of Section 310(b) of the Trust
Indenture Act.
SECTION 6.09. Eligibility of Trustee.
The Trustee hereunder shall at all times be a
corporation organized and doing business under the laws of the
United States of America or any state or territory thereof or of
the District of Columbia or a corporation or other Person
permitted to act as trustee by the Commission authorized under
such laws to exercise corporate trust powers, having a combined
capital and surplus of at least 50 million U.S. dollars
($50,000,000) and subject to supervision or examination by
Federal, state, territorial, or District of Columbia 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 6.09 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.
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The Company may not, nor may any Person directly or
indirectly controlling, controlled by, or under common control
with the Company, serve as Trustee.
In case at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section 6.09,
the Trustee shall resign immediately in the manner and with the
effect specified in Section 6.10.
SECTION 6.10. Resignation or Removal of Trustee.
(a) The Trustee, or any trustee or trustees hereafter
appointed, may at any time resign by giving
written notice of such resignation to the Company
and by mailing notice thereof to the holders of
the Securities at their addresses as they shall
appear on the Security register. Upon receiving
such notice of resignation, the Company shall
promptly appoint a successor trustee or trustees
by written instrument, in duplicate, one copy of
which instrument shall be delivered to the
resigning Trustee and one copy to the successor
trustee. If no successor trustee shall have been
so appointed and have accepted appointment within
60 days after the mailing of such notice of
resignation to the affected Securityholders, the
resigning Trustee may petition any court of
competent jurisdiction for the appointment of a
successor trustee, or any Securityholder who has
been a bona fide holder of a Security for at least
six months may, subject to the provisions of
Section 5.09, on behalf of himself and all others
similarly situated, petition any such court for
the appointment of a successor trustee. Such
court may thereupon, after such notice, if any, as
it may deem proper and prescribe, appoint a
successor trustee.
(b) In case at any time any of the following shall
occur --
(1) the Trustee shall fail to comply with the
provisions of Section 6.08 after written
request therefor by the Company or by any
Securityholder who has been a bona fide
holder of a Security or Securities for at
least six months, or
(2) the Trustee shall cease to be eligible in
accordance with the provisions of Section
6.09 and shall fail to resign after written
request therefor by the Company or by any
such Securityholder, or
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(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,
then, in any such case, the Company may remove the
Trustee and appoint a successor trustee by written
instrument, in duplicate, one copy of which
instrument shall be delivered to the Trustee so
removed and one copy to the successor trustee, or,
subject to the provisions of Section 5.09, any
Securityholder 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 and the appointment of
a successor trustee. Such court may thereupon,
after such notice, if any, as it may deem proper
and prescribe, remove the Trustee and appoint a
successor trustee.
(c) The holders of a majority in aggregate principal
amount of the Securities at the time outstanding
may at any time remove the Trustee and nominate a
successor trustee, which shall be deemed appointed
as successor trustee unless within 10 days after
such nomination the Company objects thereto or if
no successor trustee shall have been so appointed
and shall have accepted appointment within 30 days
after such removal, in which case the Trustee so
removed or any Securityholder, upon the terms and
conditions and otherwise as in subsection (a) of
this Section 6.10 provided, may petition any court
of competent jurisdiction for an appointment of a
successor trustee.
(d) Any resignation or removal of the Trustee and
appointment of a successor trustee pursuant to any
of the provisions of this Section 6.10 shall
become effective upon acceptance of appointment by
the successor trustee as provided in Section 6.11.
SECTION 6.11. Acceptance by Successor Trustee.
Any successor trustee appointed as provided in Section
6.10 shall execute, acknowledge and deliver to the Company and to
its predecessor trustee an instrument accepting such appointment
hereunder, and thereupon the resignation or removal of the
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retiring trustee shall become effective and such successor
trustee, without any further act, deed or conveyance, shall
become vested with all the rights, powers, duties and obligations
of its predecessor hereunder, with like effect as if originally
named as trustee herein; but, nevertheless, on the written
request of the Company or of the successor trustee, the trustee
ceasing to act shall, upon payment of any amounts then due it
pursuant to the provisions of Section 6.06, execute and deliver
an instrument transferring to such successor trustee all the
rights and powers of the trustee so ceasing to act and shall duly
assign, transfer and deliver to such successor trustee all
property and money held by such retiring trustee thereunder.
Upon request of any such successor trustee, the Company shall
execute any and all instruments in writing for more fully and
certainly vesting in and confirming to such successor trustee all
such rights and powers. Any trustee ceasing to act shall,
nevertheless, retain a lien upon all property or funds held or
collected by such trustee to secure any amounts then due it
pursuant to the provisions of Section 6.06.
No successor trustee shall accept appointment as
provided in this Section 6.11 unless at the time of such
acceptance such successor trustee shall be qualified under the
provisions of Section 6.08 and eligible under the provisions of
Section 6.09.
Upon acceptance of appointment by a successor trustee
as provided in this Section 6.11, the Company shall mail notice
of the succession of such trustee hereunder to the holders of
Securities at their addresses as they shall appear on the
Security register. If the Company fails to mail such notice
within 10 days after the acceptance of appointment by the
successor trustee, the successor trustee shall cause such notice
to be mailed at the expense of the Company.
SECTION 6.12. Succession by Merger, etc.
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 without the execution or filing of any
paper or any further act on the part of any of the parties
hereto.
In case at the time such successor to the Trustee shall
succeed to the trusts created by this Indenture any Securities
shall have been authenticated but not delivered, any such
successor to the Trustee may adopt the certificate of
authentication of any predecessor trustee, and deliver such
Securities so authenticated; and in case at that time any of the
Securities shall not
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have been authenticated, any successor to the Trustee may authenticate such
Securities either in the name of any predecessor hereunder or in the name
of the successor trustee; and in all such cases such certificates shall
have the full force which the Securities or this Indenture elsewhere
provides that the certificate of the Trustee shall have; provided, however,
that the right to adopt the certificate of authentication of any
predecessor Trustee or authenticate Securities in the name of any
predecessor Trustee shall apply only to its successor or successors by
merger, conversion or consolidation.
SECTION 6.13. Limitation on Rights of Trustee as a
Creditor.
The Trustee shall comply with Section 311(a) of the
Trust Indenture Act, excluding any creditor relationship
described in Section 311(b) of the Trust Indenture Act. A
Trustee who has resigned or been removed shall be subject to
Section 311(a) of the Trust Indenture Act to the extent included
therein.
SECTION 6.14. Authenticating Agents.
There may be one or more Authenticating Agents
appointed by the Trustee upon the request of the Company with
power to act on its behalf and subject to its direction in the
authentication and delivery of Securities issued upon exchange or
transfer thereof as fully to all intents and purposes as though
any such Authenticating Agent had been expressly authorized to
authenticate and deliver Securities; provided, that the Trustee
shall have no liability to the Company for any acts or omissions
of the Authenticating Agent with respect to the authentication
and delivery of Securities. Any such Authenticating Agent shall
at all times be a corporation organized and doing business under
the laws of the United States or of any state or territory
thereof or of the District of Columbia authorized under such laws
to act as Authenticating Agent, having a combined capital and
surplus of at least $5,000,000 and being subject to supervision
or examination by Federal, state, territorial or District of
Columbia authority. If such corporation publishes reports of
condition at least annually pursuant to law or the requirements
of such authority, then for the purposes of this Section 6.14 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 an
Authenticating Agent shall cease to be eligible in accordance
with the provisions of this Section, it shall resign immediately
in the manner and with the effect herein specified in this
Section.
Any corporation into which any Authenticating Agent may
be merged or converted or with which it may be consolidated, or
any corporation resulting from any merger, consolidation or
conversion to which any Authenticating Agent shall be a party, or
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any corporation succeeding to all or substantially all of the
corporate trust business of any Authenticating Agent, shall be
the successor of such Authenticating Agent hereunder, if such
successor corporation is otherwise eligible under this Section
6.14 without the execution or filing of any paper or any further
act on the part of the parties hereto or such Authenticating
Agent.
Any Authenticating Agent may at any time resign by
giving written notice of resignation to the Trustee and to the
Company. The Trustee may at any time terminate the agency of any
Authenticating Agent by giving written notice of termination to
such Authenticating Agent and to the Company. Upon receiving
such a notice of resignation or upon such a termination, or in
case at any time any Authenticating Agent shall cease to be
eligible under this Section 6.14, the Trustee may, and upon the
request of the Company shall, promptly appoint a successor
Authenticating Agent eligible under this Section 6.14, shall give
written notice of such appointment to the Company and shall mail
notice of such appointment to all Securityholders as the names
and addresses of such holders appear on the Security Register.
Any successor Authenticating Agent upon acceptance of its
appointment hereunder shall become vested with all rights,
powers, duties and responsibilities of its predecessor hereunder,
with like effect as if originally named as Authenticating Agent
herein.
The Company, as borrower, agrees to pay to any
Authenticating Agent from time to time reasonable compensation
for its services. Any Authenticating Agent shall have no
responsibility or liability for any action taken by it as such in
accordance with the directions of the Trustee.
ARTICLE VII
CONCERNING THE SECURITYHOLDERS
SECTION 7.01. Action by Securityholders.
Whenever in this Indenture it is provided that the
holders of a specified percentage in aggregate principal amount
of the Securities may take any action (including the making of
any demand or request, the giving of any notice, consent or
waiver or the taking of any other action) the fact that at the
time of taking any such action the holders of such specified
percentage have joined therein may be evidenced (a) by any
instrument or any number of instruments of similar tenor executed
by such Securityholders in person or by agent or proxy appointed
in writing, or (b) by the record of such holders of Securities
voting in favor thereof at any meeting of such Securityholders
duly called and held in accordance with the provisions of Article
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VIII, or (c) by a combination of such instrument or instruments
and any such record of such a meeting of such Securityholders.
If the Company shall solicit from the Securityholders
any request, demand, authorization, direction, notice, consent,
waiver or other action, the Company may, at its option, as
evidenced by an Officers' Certificate, fix in advance a record
date for the determination of Securityholders entitled to give
such request, demand, authorization, direction, notice, consent,
waiver or other action, but the Company shall have no obligation
to do so. If such a record date is fixed, such request, demand,
authorization, direction, notice, consent, waiver or other action
may be given before or after the record date, but only the
Securityholders of record at the close of business on the record
date shall be deemed to be Securityholders for the purposes of
determining whether Securityholders of the requisite proportion
of Outstanding Securities have authorized or agreed or consented
to such request, demand, authorization, direction, notice,
consent, waiver or other action, and for that purpose the
Outstanding Securities shall be computed as of the record date;
provided, however, that no such authorization, agreement or
consent by such Securityholders on the record date shall be
deemed effective unless it shall become effective pursuant to the
provisions of this Indenture not later than six months after the
record date.
SECTION 7.02. Proof of Execution by Securityholders.
Subject to the provisions of Section 6.01, 6.02 and
8.05, proof of the execution of any instrument by a
Securityholder or his agent or proxy shall be sufficient if made
in accordance with such reasonable rules and regulations as may
be prescribed by the Trustee or in such manner as shall be
satisfactory to the Trustee. The ownership of Securities shall
be proved by the Security Register or by a certificate of the
Security registrar. The Trustee may require such additional
proof of any matter referred to in this Section as it shall deem
necessary.
The record of any Securityholders' meeting shall be
proved in the manner provided in Section 8.06.
SECTION 7.03. Who Are Deemed Absolute Owners.
Prior to due presentment for registration of transfer
of any Security, the Company, the Trustee, any Authenticating
Agent, any paying agent, any transfer agent and any Security
registrar may deem the person in whose name such Security shall
be registered upon the Security Register to be, and may treat him
as, the absolute owner of such Security (whether or not such
Security shall be overdue) for the purpose of receiving payment
of or on account of the principal of and premium, if any, and
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interest on such Security and for all other purposes; and neither
the Company nor the Trustee nor any Authenticating Agent nor any
paying agent nor any transfer agent nor any Security registrar
shall be affected by any notice to the contrary. All such
payments so made to any holder for the time being or upon his
order shall be valid, and, to the extent of the sum or sums so
paid, effectual to satisfy and discharge the liability for moneys
payable upon any such Security.
SECTION 7.04. Securities Owned by Company Deemed Not
Outstanding.
In determining whether the holders of the requisite
aggregate principal amount of Securities have concurred in any
direction, consent or waiver under this Indenture, Securities
which are owned by the Company or any other obligor on the
Securities or by any person directly or indirectly controlling or
controlled by or under direct or indirect common control with the
Company or any other obligor on the Securities shall be
disregarded and deemed not to be outstanding for the purpose of
any such determination; provided that for the purposes of
determining whether the Trustee shall be protected in relying on
any such direction, consent or waiver, only Securities which a
Responsible Officer of the Trustee actually knows are so owned
shall be so disregarded. Securities so owned which have been
pledged in good faith may be regarded as outstanding for the
purposes of this Section 7.04 if the pledgee shall establish to
the satisfaction of the Trustee the pledgee's right to vote such
Securities and that the pledgee is not the Company or any such
other obligor or person directly or indirectly controlling or
controlled by or under direct or indirect common control with the
Company or any such other obligor. In the case of a dispute as
to such right, any decision by the Trustee taken upon the advice
of counsel shall be full protection to the Trustee.
SECTION 7.05. Revocation of Consents; Future Holders
Bound.
At any time prior to (but not after) the evidencing to
the Trustee, as provided in Section 7.01, of the taking of any
action by the holders of the percentage in aggregate principal
amount of the Securities specified in this Indenture in
connection with such action, any holder of a Security (or any
Security issued in whole or in part in exchange or substitution
therefor) the serial number of which is shown by the evidence to
be included in the Securities the holders of which have consented
to such action may, by filing written notice with the Trustee at
its principal office and upon proof of holding as provided in
Section 7.02, revoke such action so far as concerns such Security
(or so far as concerns the principal amount represented by any
exchanged or substituted Security). Except as aforesaid any such
action taken by the holder of any Security shall be conclusive and
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binding upon such holder and upon all future holders and
owners of such Security, and of any Security issued in exchange
or substitution therefor, irrespective of whether or not any
notation in regard thereto is made upon such Security or any
Security issued in exchange or substitution therefor.
ARTICLE VIII
SECURITYHOLDERS' MEETINGS
SECTION 8.01. Purposes of Meetings.
A meeting of Securityholders may be called at any time
and from time to time pursuant to the provisions of this Article
VIII for any of the following purposes:
(a) to give any notice to the Company or to the
Trustee, or to give any directions to the Trustee,
or to consent to the waiving of any default
hereunder and its consequences, or to take any
other action authorized to be taken by
Securityholders pursuant to any of the provisions
of Article V;
(b) to remove the Trustee and nominate a successor
trustee pursuant to the provisions of Article VI;
(c) to consent to the execution of an indenture or
indentures supplemental hereto pursuant to the
provisions of Section 9.02; or
(d) to take any other action authorized to be taken by
or on behalf of the holders of any specified
aggregate principal amount of such Securities
under any other provision of this Indenture or
under applicable law.
SECTION 8.02. Call of Meetings by Trustee.
The Trustee may at any time call a meeting of
Securityholders to take any action specified in Section 8.01, to
be held at such time and at such place in the Borough of
Manhattan, The City of New York, as the Trustee shall determine.
Notice of every meeting of the Securityholders, setting forth the
time and the place of such meeting and in general terms the
action proposed to be taken at such meeting, shall be mailed to
holders of Securities at their addresses as they shall appear on
the Securities Register. Such notice shall be mailed not less
than 20 nor more than 180 days prior to the date fixed for the
meeting.
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SECTION 8.03. Call of Meetings by Company or
Securityholders.
In case at any time the Company pursuant to a
resolution of the Board of Directors, or the holders of at least
10% in aggregate principal amount of the Securities then
outstanding, shall have requested the Trustee to call a meeting
of Securityholders, by written request setting forth in
reasonable detail the action proposed to be taken at the meeting,
and the Trustee shall not have mailed the notice of such meeting
within 20 days after receipt of such request, then the Company or
such Securityholders may determine the time and the place in said
Borough of Manhattan for such meeting and may call such meeting
to take any action authorized in Section 8.01, by mailing notice
thereof as provided in Section 8.02.
SECTION 8.04. Qualifications for Voting.
To be entitled to vote at any meeting of
Securityholders a person shall (a) be a holder of one or more
Securities or (b) a person appointed by an instrument in writing
as proxy by a holder of one or more Securities. The only persons
who shall be entitled to be present or to speak at any meeting of
Securityholders shall be the persons entitled to vote at such
meeting and their counsel and any representatives of the Trustee
and its counsel and any representatives of the Company and its
counsel.
SECTION 8.05. Regulations.
Notwithstanding any other provisions of this Indenture,
the Trustee may make such reasonable regulations as it may deem
advisable for any meeting of Securityholders, in regard to proof
of the holding of Securities and of the appointment of proxies,
and in regard to the appointment and duties of inspectors of
votes, the submission and examination of proxies, certificates
and other evidence of the right to vote, and such other matters
concerning the conduct of the meeting as it shall think fit.
The Trustee shall, by an instrument in writing, appoint
a temporary chairman of the meeting, unless the meeting shall
have been called by the Company or by Securityholders as provided
in Section 8.03, in which case the Company or the Securityholders
calling the meeting, as the case may be, shall in like manner
appoint a temporary chairman. A permanent chairman and a
permanent secretary of the meeting shall be elected by majority
vote of the meeting.
Subject to the provisions of Section 8.04, at any
meeting each holder of Securities or proxy therefor shall be
entitled to one vote for each $1,000 principal amount of
Securities held or represented by him; provided, however, that no
vote
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shall be cast or counted at any meeting in respect of any
Security challenged as not outstanding and ruled by the chairman
of the meeting to be not outstanding. The chairman of the
meeting shall have no right to vote other than by virtue of
Securities held by him or instruments in writing as aforesaid
duly designating him as the person to vote on behalf of other
Securityholders. Any meeting of Securityholders duly called
pursuant to the provisions of Section 8.02 or 8.03 may be
adjourned from time to time by a majority of those present,
whether or not constituting a quorum, and the meeting may be held
as so adjourned without further notice.
SECTION 8.06. Voting.
The vote upon any resolution submitted to any meeting
of holders of Securities shall be by written ballots on which
shall be subscribed the signatures of such holders or of their
representatives by proxy and the serial number or numbers of the
Securities held or represented by them. The permanent chairman
of the meeting shall appoint two inspectors of votes who shall
count all votes cast at the meeting for or against any resolution
and who shall make and file with the secretary of the meeting
their verified written reports in triplicate of all votes cast at
the meeting. A record in duplicate of the proceedings of each
meeting of Securityholders shall be prepared by the secretary of
the meeting and there shall be attached to said record the
original reports of the inspectors of votes on any vote by ballot
taken thereat and affidavits by one or more persons having
knowledge of the facts setting forth a copy of the notice of the
meeting and showing that said notice was mailed as provided in
Section 8.02. The record shall show the serial numbers of the
Securities voting in favor of or against any resolution. The
record shall be signed and verified by the affidavits of the
permanent chairman and secretary of the meeting and one of the
duplicates shall be delivered to the Company and the other to the
Trustee to be preserved by the Trustee, the latter to have
attached thereto the ballots voted at the meeting.
Any record so signed and verified shall be
conclusive evidence of the matters therein stated.
ARTICLE IX
AMENDMENTS
SECTION 9.01. Without Consent of Securityholders.
The Company and the Trustee may from time to time and
at any time amend the Indenture, without the consent of the
Securityholders, for one or more of the following purposes:
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(a) to evidence the succession of another corporation
to the Company, or successive successions, and the
assumption by the successor corporation of the
covenants, agreements and obligations of the
Company pursuant to Article X hereof;
(b) to add to the covenants of the Company such
further covenants, restrictions or conditions for
the protection of the Securityholders as the Board
of Directors and the Trustee shall consider to be
for the protection of the Securityholders, and to
make the occurrence, or the occurrence and
continuance, of a default in any of such
additional covenants, restrictions or conditions a
default or an Event of Default permitting the
enforcement of all or any of the remedies provided
in this Indenture as herein set forth; provided,
however, that in respect of any such additional
covenant, restriction or condition such amendment
may provide for a particular period of grace after
default (which period may be shorter or longer
than that allowed in the case of other defaults)
or may provide for an immediate enforcement upon
such default or may limit the remedies available
to the Trustee upon such default;
(c) to provide for the issuance under this Indenture
of Securities in coupon form (including Securities
registrable as to principal only) and to provide
for exchangeability of such Securities with the
Securities issued hereunder in fully registered
form and to make all appropriate changes for such
purpose;
(d) to cure any ambiguity or to correct or supplement
any provision contained herein or in any
supplemental indenture which may be defective or
inconsistent with any other provision contained
herein or in any supplemental indenture, or to
make such other provisions in regard to matters or
questions arising under this Indenture; provided
that any such action shall not materially
adversely affect the interests of the holders of
the Securities;
(e) to evidence and provide for the acceptance of
appointment hereunder by a successor trustee with
respect to the Securities;
(f) to make provision for transfer procedures,
certification, book-entry provisions and all other
matters required pursuant to Section 2.07 or
otherwise necessary, desirable or appropriate in con-
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nection with the issuance of Securities to
holders of Capital Securities in the event of a
distribution of Securities by the Trust following
a Dissolution Event;
(g) to qualify or maintain qualification of this
Indenture under the Trust Indenture Act; or
(h) to make any change that does not adversely affect
the rights of any Securityholder in any material
respect.
The Trustee is hereby authorized to join with the
Company in the execution of any supplemental indenture to effect
such amendment, to make any further appropriate agreements and
stipulations which may be therein contained and to accept the
conveyance, transfer and assignment of any property thereunder,
but the Trustee shall not be obligated to, but may in its
discretion, enter into any such supplemental indenture which
affects the Trustee's own rights, duties or immunities under this
Indenture or otherwise.
Any amendment to the Indenture authorized by the
provisions of this Section 9.01 may be executed by the Company
and the Trustee without the consent of the holders of any of the
Securities at the time outstanding, notwithstanding any of the
provisions of Section 9.02.
SECTION 9.02. With Consent of Securityholders.
With the consent (evidenced as provided in Section
7.01) of the holders of a majority in aggregate principal amount
of the Securities at the time outstanding, the Company, when
authorized by a Board Resolution, and the Trustee may from time
to time and at any time amend the Indenture 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 the Securities; provided,
however, that no such amendment shall without the consent of the
holders of each Security then outstanding and affected thereby
(i) extend the Maturity Date of any Security, or reduce the rate
or extend the time of payment of interest thereon (except as
contemplated by Article XVI), or reduce the principal amount
thereof, or reduce any amount payable on redemption thereof, or
make the principal thereof or any interest or premium thereon
payable in any coin or currency other than that provided in the
Securities, or impair or affect the right of any Securityholder
to institute suit for payment thereof, or (ii) reduce the
aforesaid percentage of Securities the holders of which are
required to consent to any such amendment to the Indenture,
provided, however, that if the Securities are held by the Trust,
such amendment shall not be effective until the holders of a
majority
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in liquidation amount of Trust Securities shall have
consented to such amendment; provided, further, that if the
consent of the holder of each outstanding Security is required,
such amendment shall not be effective until each holder of the
Trust Securities shall have consented to such amendment.
Upon the request of the Company accompanied by a copy
of a resolution of the Board of Directors certified by its Clerk
or Assistant Clerk authorizing the execution of any supplemental
indenture effecting such amendment, and upon the filing with the
Trustee of evidence of the consent of Securityholders as
aforesaid, the Trustee shall join with the Company in the
execution of such supplemental indenture unless such supplemental
indenture affects the Trustee's own rights, duties or immunities
under this Indenture or otherwise, in which case the Trustee may
in its discretion, but shall not be obligated to, enter into such
supplemental indenture. The Trustee may receive an Opinion of
Counsel as conclusive evidence that any supplemental indenture
executed pursuant to this Article is authorized or permitted by,
and conforms to, the terms of this Article and that it is proper
for the Trustee under the provisions of this Article to join in
the execution thereof.
Promptly after the execution by the Company and the
Trustee of any supplemental indenture pursuant to the provisions
of this Section, the Trustee shall transmit by mail, first class
postage prepaid, a notice, prepared by the Company, setting forth
in general terms the substance of such supplemental indenture, to
the Securityholders as their names and addresses appear upon the
Security Register. Any failure of the Trustee to mail such
notice, or any defect therein, shall not, however, in any way
impair or affect the validity of any such supplemental indenture.
It shall not be necessary for the consent of the
Securityholders under this Section 9.02 to approve the particular
form of any proposed supplemental indenture, but it shall be
sufficient if such consent shall approve the substance thereof.
SECTION 9.03. Compliance with Trust Indenture Act;
Effect of Supplemental Indentures.
Any supplemental indenture executed pursuant to the
provisions of this Article IX shall comply with the Trust
Indenture Act. Upon the execution of any supplemental indenture
pursuant to the provisions of this Article IX, this Indenture
shall be and be deemed to be modified and amended in accordance
therewith and the respective rights, limitations of rights,
obligations, duties and immunities under this Indenture of the
Trustee, the Company and the holders of Securities shall
thereafter be determined, exercised and enforced hereunder
subject in all respects to such modifications and amendments and
all the terms and conditions of any such supplemental indenture
shall be
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and be deemed to be part of the terms and conditions of this Indenture
for any and all purposes.
SECTION 9.04. Notation on Securities.
Securities authenticated and delivered after the
execution of any supplemental indenture affecting such Securities
pursuant to the provisions of this Article IX may bear a notation
in form approved by the Trustee as to any matter provided for in
such supplemental indenture. If the Company or the Trustee shall
so determine, new Securities so modified as to conform, in the
opinion of the Trustee and the Board of Directors, to any
modification of this Indenture contained in any such supplemental
indenture may be prepared and executed by the Company,
authenticated by the Trustee or the Authenticating Agent and
delivered in exchange for the Securities then outstanding.
SECTION 9.05. Evidence of Compliance of Supplemental
Indenture to be Furnished Trustee.
The Trustee, subject to the provisions of Sections 6.01
and 6.02, may receive an Officers' Certificate and an Opinion of
Counsel as conclusive evidence that any supplemental indenture
executed pursuant hereto complies with the requirements of this
Article IX.
ARTICLE X
CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE
SECTION 10.01. Company May Consolidate, etc., on
Certain Terms.
Nothing contained in this Indenture or in any of the
Securities shall prevent any consolidation or merger of the
Company with or into any other Person (whether or not affiliated
with the Company, as the case may be), or successive
consolidations or mergers in which the Company, as the case may
be, or its successor or successors shall be a party or parties,
or shall prevent any sale, conveyance, transfer or lease of the
property of the Company, as the case may be, or its successor or
successors as an entirety, or substantially as an entirety, to
any other Person (whether or not affiliated with the Company, as
the case may be, or its successor or successors) authorized to
acquire and operate the same; provided, that (a) the Company is
the surviving Person, or the Person formed by or surviving any
such consolidation or merger (if other than the Company) or to
which such sale, conveyance, transfer or lease of property is
made is a Person organized and existing under the laws of the
United States or any State thereof or the District of Columbia,
and (b) upon any such consolidation, merger, sale, conveyance,
transfer or lease, the due and punctual payment of the principal
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of (and premium, if any) and interest on the Securities according
to their tenor and the due and punctual performance and
observance of all the covenants and conditions of this Indenture
to be kept or performed by the Company shall be expressly
assumed, by supplemental indenture (which shall conform to the
provisions of the Trust Indenture Act, as then in effect)
satisfactory in form to the Trustee executed and delivered to the
Trustee by the Person formed by such consolidation, or into which
the Company, as the case may be, shall have been merged, or by
the Person which shall have acquired such property, and (c) after
giving effect to such consolidation, merger, sale, conveyance,
transfer or lease, no Default or Event of Default shall have
occurred and be continuing.
SECTION 10.02. Successor Corporation to be Substituted
for Company.
In case of any such consolidation, merger, conveyance
or transfer and upon the assumption by the successor corporation,
by supplemental indenture, executed and delivered to the Trustee
and satisfactory in form to the Trustee, of the due and punctual
payment of the principal of and premium, if any, and interest on
all of the Securities and the due and punctual performance and
observance of all of the covenants and conditions of this
Indenture to be performed or observed by the Company, such
successor Person shall succeed to and be substituted for the
Company, with the same effect as if it had been named herein as
the party of the first part, and the Company thereupon shall be
relieved of any further liability or obligation hereunder or upon
the Securities. Such successor Person thereupon may cause to be
signed, and may issue either in its own name or in the name of
BankBoston Corporation, any or all of the Securities issuable
hereunder which theretofore shall not have been signed by the
Company and delivered to the Trustee or the Authenticating Agent;
and, upon the order of such successor Person instead of the
Company and subject to all the terms, conditions and limitations
in this Indenture prescribed, the Trustee or the Authenticating
Agent shall authenticate and deliver any Securities which
previously shall have been signed and delivered by the officers
of the Company to the Trustee or the Authenticating Agent for
authentication, and any Securities which such successor Person
thereafter shall cause to be signed and delivered to the Trustee
or the Authenticating Agent for that purpose. All the Securities
so issued shall in all respects have the same legal rank and
benefit under this Indenture as the Securities theretofore 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.
SECTION 10.03. Opinion of Counsel to be Given Trustee.
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The Trustee, subject to the provisions of Sections 6.01
and 6.02, may receive an Opinion of Counsel as conclusive
evidence that any consolidation, merger, sale, conveyance,
transfer or lease, and any assumption, permitted or required by
the terms of this Article X complies with the provisions of this
Article X.
ARTICLE XI
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 11.01. Discharge of Indenture.
When (a) the Company shall deliver to the Trustee for
cancellation all Securities theretofore authenticated (other than
any Securities which shall have been destroyed, lost or stolen
and which shall have been replaced or paid as provided in Section
2.08) and not theretofore cancelled, or (b) all the Securities
not theretofore cancelled or delivered to the Trustee for
cancellation shall have become due and payable, or are by their
terms to become due and payable within one year or are to be
called for redemption within one year under arrangements
satisfactory to the Trustee for the giving of notice of
redemption, and the Company shall deposit with the Trustee, in
trust, funds sufficient to pay on the Maturity Date or upon
redemption all of the Securities (other than any Securities which
shall have been destroyed, lost or stolen and which shall have
been replaced or paid as provided in Section 2.08) not
theretofore cancelled or delivered to the Trustee for
cancellation, including principal and premium, if any, and
interest due or to become due to the Maturity Date or redemption
date, as the case may be, but excluding, however, the amount of
any moneys for the payment of principal of or premium, if any, or
interest on the Securities (1) theretofore repaid to the Company
in accordance with the provisions of Section 11.04, or (2) paid
to any State or to the District of Columbia pursuant to its
unclaimed property or similar laws, and if in either case the
Company shall also pay or cause to be paid all other sums payable
hereunder by the Company, then this Indenture shall cease to be
of further effect except for the provisions of Sections 2.02,
2.07, 2.08, 3.01, 3.02, 3.04, 6.06, 6.10 and 11.04 hereof shall
survive until such Securities shall mature and be paid.
Thereafter, Sections 6.10 and 11.04 shall survive, and the
Trustee, on demand of the Company accompanied by any Officers'
Certificate and an Opinion of Counsel and at the cost and expense
of the Company, shall execute proper instruments acknowledging
satisfaction of and discharging this Indenture, the Company,
however, hereby agreeing to reimburse the Trustee for any costs
or expenses thereafter reasonably and properly incurred by the
Trustee in connection with this Indenture or the Securities.
SECTION 11.02. Deposited Moneys and U.S. Government
Obligations to be Held in Trust by
Trustee.
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Subject to the provisions of Section 11.04, all moneys
and U.S. Government Obligations deposited with the Trustee
pursuant to Sections 11.01 or 11.05 shall be held in trust and
applied by it to the payment, either directly or through any
paying agent (including the Company if acting as its own paying
agent), to the holders of the particular Securities for the
payment of which such moneys or U.S. Government Obligations have
been deposited with the Trustee, of all sums due and to become
due thereon for principal, premium, if any, and interest.
The Company shall pay and indemnify the Trustee against
any tax, fee or other charge imposed on or assessed against the
U.S. Government Obligations deposited pursuant to Section 11.05
or the principal and interest received in respect thereof other
than any such tax, fee or other charge which by law is for the
account of the holders of outstanding Securities.
SECTION 11.03. Paying Agent to Repay Moneys Held.
Upon the satisfaction and discharge of this Indenture
all moneys then held by any paying agent of the Securities (other
than the Trustee) shall, upon written demand of the Company, be
repaid to it or paid to the Trustee, and thereupon such paying
agent shall be released from all further liability with respect
to such moneys.
SECTION 11.04. Return of Unclaimed Moneys.
Any moneys deposited with or paid to the Trustee or any
paying agent for payment of the principal of or premium, if any,
or interest on Securities and not applied but remaining unclaimed
by the holders of Securities for two years after the date upon
which the principal of or premium, if any, or interest on such
Securities, as the case may be, shall have become due and
payable, shall be repaid to the Company by the Trustee or such
paying agent on written demand; and the holder of any of the
Securities shall thereafter look only to the Company for any
payment which such holder may be entitled to collect and all
liability of the Trustee or such paying agent with respect to
such moneys shall thereupon cease.
SECTION 11.05. Defeasance Upon Deposit of Moneys or
U.S. Government Obligations.
The Company shall be deemed to have been Discharged (as
defined below) from its respective obligations with respect to
the Securities on the 91st day after the applicable conditions
set forth below have been satisfied with respect to the
Securities at any time after the applicable conditions set forth
below have been satisfied:
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(1) The Company shall have deposited or caused to be
deposited irrevocably with the Trustee or the
Defeasance Agent (as defined below) as trust funds
in trust, specifically pledged as security for,
and dedicated solely to, the benefit of the
holders of the Securities (i) money in an amount,
or (ii) U.S. Government Obligations which through
the payment of interest and principal in respect
thereof in accordance with their terms will
provide, not later than one day before the due
date of any payment, money in an amount, or (iii)
a combination of (i) and (ii), sufficient, in the
opinion (with respect to (ii) and (iii)) of a
nationally recognized firm of independent public
accountants expressed in a written certification
thereof delivered to the Trustee and the
Defeasance Agent, if any, to pay and discharge
each installment of principal of and interest and
premium, if any, on the outstanding Securities on
the dates such installments of principal, interest
or premium are due;
(2) if the Securities are then listed on any national
securities exchange or interdealer quotation
system, the Company shall have delivered to the
Trustee and the Defeasance Agent, if any, an
Opinion of Counsel to the effect that the exercise
of the option under this Section 11.05 would not
cause such Securities to be delisted from such
exchange or interdealer quotation system;
(3) no Default or Event of Default with respect to the
Securities shall have occurred and be continuing
on the date of such deposit; and
(4) the Company shall have delivered to the Trustee
and the Defeasance Agent, if any, an Opinion of
Counsel to the effect that holders of the
Securities will not recognize income, gain or loss
for United States Federal income tax purposes as a
result of the exercise of the option under this
Section 11.05 and will be subject to United States
Federal income tax on the same amount and in the
same manner and at the same times as would have
been the case if such option had not been
exercised, and such opinion shall be accompanied
by a private letter ruling to that effect received
from the United States Internal Revenue Service or
a revenue ruling pertaining to a comparable form
of transaction to that effect published by the
United States Internal Revenue Service.
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"Discharged" means that the Company shall be deemed to
have paid and discharged the entire indebtedness represented by,
and obligations under, the Securities and to have satisfied all
the obligations under this Indenture relating to the Securities
(and the Trustee, at the expense of the Company, shall execute
proper instruments acknowledging the same), except (A) the rights
of holders of Securities to receive, from the trust fund
described in clause (1) above, payment of the principal of and
the interest and premium, if any, on the Securities when such
payments are due; (B) the Company's obligations with respect to
the Securities under Sections 2.07, 2.08, 5.02 and 11.04; and (C)
the rights, powers, trusts, duties and immunities of the Trustee
hereunder.
"Defeasance Agent" means another financial institution
which is eligible to act as Trustee hereunder and which assumes
all of the obligations of the Trustee necessary to enable the
Trustee to act hereunder. In the event such a Defeasance Agent
is appointed pursuant to this Section, the following conditions
shall apply:
(1) The Trustee shall have approval rights over the
document appointing such Defeasance Agent and the
document setting forth such Defeasance Agent's
rights and responsibilities;
(2) The Defeasance Agent shall provide verification to
the Trustee acknowledging receipt of sufficient
money and/or U.S. Government Obligations to meet
the applicable conditions set forth in this
Section 11.05.
ARTICLE XII
IMMUNITY OF INCORPORATORS, STOCKHOLDERS,
OFFICERS AND DIRECTORS
SECTION 12.01. Indenture and Securities Solely
Corporate Obligations.
No recourse for the payment of the principal of or
premium, if any, or interest on any Security, or for any claim
based thereon or otherwise in respect thereof, and no recourse
under or upon any obligation, covenant or agreement of the
Company in this Indenture, or in any Security, or because of the
creation of any indebtedness represented thereby, shall be had
against any incorporator, stockholder, officer or director, as
such, past, present or future, of the Company or of any successor
Person to the Company, either directly or through the Company or
any successor Person to the Company, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of
any assessment or penalty or otherwise; it being expressly
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understood that all such liability is hereby expressly waived and
released as a condition of, and as a consideration for, the
execution of this Indenture and the issue of the Securities.
ARTICLE XIII
MISCELLANEOUS PROVISIONS
SECTION 13.01. Successors.
All the covenants, stipulations, promises and
agreements in this Indenture contained by the Company shall bind
its successors and assigns whether so expressed or not.
SECTION 13.02. Official Acts by Successor Corporation.
Any act or proceeding by any provision of this
Indenture authorized or required to be done or performed by any
board, committee or officer of the Company shall and may be done
and performed with like force and effect by the like board,
committee or officer of any corporation that shall at the time be
the lawful sole successor of the Company.
SECTION 13.03. Surrender of Company Powers.
The Company by instrument in writing executed by
authority of 2/3 (two-thirds) of its Board of Directors and
delivered to the Trustee may surrender any of the powers reserved
to the Company, and thereupon such power so surrendered shall
terminate both as to the Company, as the case may be, and as to
any successor Person.
SECTION 13.04. Addresses for Notices, etc.
Any notice or demand which by any provision of this
Indenture is required or permitted to be given or served by the
Trustee or by the holders of Securities on the Company may be
given or served by being deposited postage prepaid by registered
or certified mail in a post office letter box addressed (until
another address is filed by the Company with the Trustee for the
purpose) to the Company, 100 Federal Street, MA BOS 01-25-01,
Boston, Massachusetts 02110, Attention: General Counsel. Any
notice, direction, request or demand by any Securityholder to or
upon the Trustee shall be deemed to have been sufficiently given
or made, for all purposes, if given or made in writing at the
office of the Trustee, addressed to the Trustee, 101 Barclay
Street, 21 West, New York, New York 10286, Attention: Corporate
Trust Administration.
SECTION 13.05. Governing Law.
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This Indenture and each Security shall be deemed to be
a contract made under the laws of the State of New York, and for
all purposes shall be governed by and construed in accordance
with the laws of said State, without regard to conflicts of laws
principles thereof.
SECTION 13.06. Evidence of Compliance with Conditions
Precedent.
Upon any application or demand by the Company to the
Trustee to take any action under any of the provisions of this
Indenture, the Company shall furnish to the Trustee an Officers'
Certificate stating that in the opinion of the signers all
conditions 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 have been complied with.
Each certificate or opinion provided for in this
Indenture and delivered to the Trustee with respect to compliance
with a condition or covenant provided for in this Indenture shall
include (1) a statement that the person making such certificate
or opinion has read such covenant or condition; (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 such person, 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 or not,
in the opinion of such person, such condition or covenant has
been complied with.
SECTION 13.07. Business Days.
Except as otherwise provided in Section 2.06(b), in any
case where the date of payment of principal of or premium, if
any, or interest on the Securities will not be a Business Day,
the payment of such principal of or premium, if any, or interest
on the Securities need not be made on such date but may be made
on the next succeeding Business Day, with the same force and
effect as if made on the date of payment and no interest shall
accrue for the period from and after such date.
SECTION 13.08. Trust Indenture Act to Control.
If and to the extent that any provision of this
Indenture limits, qualifies or conflicts with another provision
included in this Indenture which is required to be included in
this Indenture by any of Sections 310 to 317, inclusive, of the
Trust Indenture Act of 1939, such required provision shall
control.
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SECTION 13.09. Table of Contents, Headings, etc.
The table of contents and the titles and headings of
the articles and sections of this Indenture have been inserted
for convenience of reference only, are not to be considered a
part hereof, and shall in no way modify or restrict any of the
terms or provisions hereof.
SECTION 13.10. Execution in Counterparts.
This Indenture may be executed in any number of
counterparts, each of which shall be an original, but such
counterparts shall together constitute but one and the same
instrument.
SECTION 13.11. Separability.
In case any one or more of the provisions contained in
this Indenture or in the Securities shall for any reason be held
to be invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect any
other provisions of this Indenture or of the Securities, but this
Indenture and the Securities shall be construed as if such
invalid or illegal or unenforceable provision had never been
contained herein or therein.
SECTION 13.12. Assignment.
The Company will have the right at all times to assign
any of its respective rights or obligations under this Indenture
to a direct or indirect wholly owned Subsidiary of the Company,
provided that, in the event of any such assignment, the Company,
as the case may be, will remain liable for all such obligations.
Subject to the foregoing, the Indenture is binding upon and
inures to the benefit of the parties thereto and their respective
successors and assigns. This Indenture may not otherwise be
assigned by the parties thereto.
SECTION 13.13. Acknowledgement of Rights.
The Company acknowledges that, with respect to any
Securities held by the Trust or a trustee of such trust, if the
Property Trustee of such Trust fails to enforce its rights under
this Indenture as the holder of the Securities held as the assets
of the Trust any holder of Capital Securities may institute legal
proceedings directly against the Company to enforce such Property
Trustee's rights under this Indenture without first instituting
any legal proceedings against such Property Trustee or any other
person or entity. Notwithstanding the foregoing, if an Event of
Default has occurred and is continuing and such event is
attributable to the failure of the Company to pay principal of or
premium, if any, or interest on the Securities when due, the
Company acknowledges that a holder of Capital Securities may di-
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rectly institute a proceeding for enforcement of payment to
such holder of the principal of or premium, if any, or interest
on the Securities having a principal amount equal to the
aggregate liquidation amount of the Capital Securities of such
holder on or after the respective due date specified in the
Securities.
ARTICLE XIV
REDEMPTION OF SECURITIES --
MANDATORY AND OPTIONAL SINKING FUND
SECTION 14.01. Special Event Redemption.
If a Special Event has occurred and is continuing then,
notwithstanding Section 14.02(a) but subject to Section 14.02(c),
the Company shall have the right, upon (i) not less than 45 days
written notice to the Trustee and (ii) not less than 30 days nor
more than 60 days written notice to the Securityholders, to
redeem the Securities, in whole (but not in part), within 90 days
following the occurrence of such Special Event at the Redemption
Price. The Redemption Price shall be paid prior to 12:00 noon,
New York time, on the date of such redemption or such earlier
time as the Company determines, provided that the Company shall
deposit with the Trustee an amount sufficient to pay the
Redemption Price by 10:00 a.m., New York time, on the date such
Redemption Price is to be paid.
SECTION 14.02. Optional Redemption by Company.
(a) Subject to the provisions of this Article XIV, the
Company shall have the right to redeem the Securities, in whole
or in part, from time to time, on or after _______, 2007, at the
Redemption Price.
If the Securities are only partially redeemed pursuant
to this Section 14.02, the Securities will be redeemed pro rata
or by lot or by any other method utilized by the Trustee;
provided, that if at the time of redemption the Securities are
registered as a Global Security, the Depositary shall determine,
in accordance with its procedures, the principal amount of such
Securities held by each holder of a Security to be redeemed. The
Redemption Price shall be paid prior to 12:00 noon, New York
time, on the date of such redemption or such earlier time as the
Company determines, provided that the Company shall deposit with
the Trustee an amount sufficient to pay the Redemption Price by
10:00 a.m., New York time, on the date such Redemption Price is
to be paid.
(b) Notwithstanding the first sentence of Section
14.02, upon the entry of an order for dissolution of the Trust by
a court of competent jurisdiction, the Securities thereafter will
be subject to option redemption, in whole only, but not in part,
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on or after _______, 2007, at the Redemption Price and otherwise
in accordance with this Article XIV.
(c) Any redemption of Securities pursuant to Section
14.01 or Section 14.02 shall be subject to the Company obtaining
the prior approval of the Federal Reserve, if such approval is
then required under applicable capital guidelines or policies of
the Federal Reserve.
SECTION 14.03. No Sinking Fund.
The Securities are not entitled to the benefit of any
sinking fund.
SECTION 14.04. Notice of Redemption; Selection of
Securities.
In case the Company shall desire to exercise the right
to redeem all, or, as the case may be, any part of the Securities
in accordance with their terms, it shall fix a date for
redemption and shall mail a notice of such redemption at least 30
and not more than 60 days prior to the date fixed for redemption
to the holders of Securities so to be redeemed as a whole or in
part at their last addresses as the same appear on the Security
Register. Such mailing shall be by first class mail. 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, 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.
Each such notice of redemption shall specify the CUSIP
number of the Securities to be redeemed, the date fixed for
redemption, the redemption price at which the Securities are to
be redeemed (or the method by which such redemption price is to
be calculated), the place or places of payment that payment will
be made upon presentation and surrender of the Securities, that
interest accrued to the date fixed for redemption will be paid as
specified in said notice, and that on and after said date
interest thereon or on the portions thereof to be redeemed will
cease to accrue. If less than all the Securities are to be
redeemed the notice of redemption shall specify the numbers of
the Securities to be redeemed. In case any Security is to be
redeemed in part only, the notice of redemption shall state the
portion of the principal amount thereof to be redeemed and shall
state that on and after the date fixed for redemption, upon
surrender of such Security, a new Security or Securities in
principal amount equal to the unredeemed portion thereof will be
issued.
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On or prior to the redemption date specified in the
notice of redemption given as provided in this Section, the
Company will deposit with the Trustee or with one or more paying
agents an amount of money sufficient to redeem on the redemption
date all the Securities so called for redemption at the
appropriate Redemption Price, together with accrued interest to
the date fixed for redemption.
The Company will give the Trustee notice not less than
45 days prior to the redemption date as to the aggregate
principal amount of Securities to be redeemed and the Trustee
shall select, in such manner as in its sole discretion it shall
deem appropriate and fair, the Securities or portions thereof (in
integral multiples of $1,000, except as otherwise set forth in
the applicable form of Security) to be redeemed.
SECTION 14.05. Payment of Securities Called for
Redemption.
If notice of redemption has been given as provided in
Section 14.04, the Securities or portions 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 interest
accrued to the date fixed for redemption (subject to the rights
of holders of Securities on the close of business on a regular
record date in respect of an Interest Payment Date occurring on
or prior to the redemption date), and on and after said date
(unless the Company shall default in the payment of such
Securities at the Redemption Price, together with interest
accrued to said date) interest on the Securities or portions of
Securities so called for redemption shall cease to accrue. On
presentation and surrender of such Securities at a place of
payment specified in said notice, the said Securities or the
specified portions thereof shall be paid and redeemed by the
Company at the applicable Redemption Price, together with
interest accrued thereon to the date fixed for redemption
(subject to the rights of holders of Securities on the close of
business on a regular record date in respect of an Interest
Payment Date occurring on or prior to the redemption date).
Upon presentation of any Security redeemed in part
only, the Company shall execute and the Trustee shall
authenticate and make available for delivery to the holder
thereof, at the expense of the Company, a new Security or
Securities of authorized denominations, in principal amount equal
to the unredeemed portion of the Security so presented.
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ARTICLE XV
SUBORDINATION OF SECURITIES
SECTION 15.01. Agreement to Subordinate.
The Company covenants and agrees, and each holder of
Securities issued hereunder likewise covenants and agrees, that
the Securities shall be issued subject to the provisions of this
Article XV; and each holder of a Security, whether upon original
issue or upon transfer or assignment thereof, accepts and agrees
to be bound by such provisions.
The payment by the Company of the principal of and
premium, if any, and interest on all Securities issued hereunder
shall, to the extent and in the manner hereinafter set forth, be
subordinated and junior in right of payment to the prior payment
in full of all Allocable Amounts with respect to Senior
Indebtedness, whether outstanding at the date of this Indenture
or thereafter incurred.
No provision of this Article XV shall prevent the
occurrence of any Default or Event of Default hereunder.
SECTION 15.02. Default on Senior Indebtedness.
In the event and during the continuation of any default
by the Company in the payment of principal, premium, interest or
any other payment due on any Senior Indebtedness, or in the event
that the maturity of any Senior Indebtedness has been accelerated
because of a default, then, in either case, no payment shall be
made by the Company with respect to the principal (including
redemption payments) of or premium, if any, or interest on the
Securities.
In the event of the acceleration of the maturity of the
Securities, then no payment shall be made by the Company with
respect to the principal (including redemption payments) of or
premium, if any, or interest on the Securities until the holders
of all Senior Indebtedness outstanding at the time of such
acceleration shall receive payment in full of all Allocable
Amounts due in respect of such Senior Indebtedness (including any
amounts due upon acceleration).
In the event that, notwithstanding the foregoing, any
payment shall be received by the Trustee when such payment is
prohibited by the preceding paragraph of this Section 15.02, such
payment shall be held in trust for the benefit of, and shall be
paid over or delivered to, the holders of Senior Indebtedness or
their respective representatives, or to the trustee or trustees
under any indenture pursuant to which any of such Senior
Indebtedness may have been issued, as their respective interests
may appear, but only to the extent of the Allocable Amounts in
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respect of such Senior Indebtedness and only to the extent that
the holders of the Senior Indebtedness (or their representative
or representatives or a trustee) notify the Trustee in writing,
within 90 days of such payment, of the Allocable Amounts then due
and owing on such Senior Indebtedness and only the Allocable
Amounts specified in such notice to the Trustee shall be paid to
the holders of such Senior Indebtedness.
SECTION 15.03. Liquidation; Dissolution; Bankruptcy.
Upon any payment by the Company or distribution of
assets of the Company of any kind or character, whether in cash,
property or securities, to creditors upon any dissolution or
winding-up or liquidation or reorganization of the Company,
whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, all Allocable Amounts due upon
all Senior Indebtedness of the Company shall first be paid in
full, or payment thereof provided for in money in accordance with
its terms, before any payment is made by the Company on account
of the principal (and premium, if any) or interest on the
Securities; and upon any such dissolution or winding-up or
liquidation or reorganization, any payment by the Company, or
distribution of assets of the Company of any kind or character,
whether in cash, property or securities, to which the
Securityholders or the Trustee would be entitled to receive from
the Company, except for the provisions of this Article XV, shall
be paid by the Company or by any receiver, trustee in bankruptcy,
liquidating trustee, agent or other Person making such payment or
distribution, or by the Securityholders or by the Trustee under
the Indenture if received by them or it, directly to the holders
of Senior Indebtedness of the Company (pro rata to such holders
on the basis of the respective Allocable Amounts of Senior
Indebtedness held by such holders, as calculated by the Company)
or their representative or representatives, or to the trustee or
trustees under any indenture pursuant to which any instruments
evidencing such Senior Indebtedness may have been issued, as
their respective interests may appear, to the extent necessary to
pay all Allocable Amounts in respect of such Senior Indebtedness
in full, in money or money's worth, after giving effect to any
concurrent payment or distribution to or for the holders of such
Senior Indebtedness, before any payment or distribution is made
to the Securityholders or to the Trustee.
In the event that, notwithstanding the foregoing, any
payment or distribution of assets of the Company of any kind or
character, whether in cash, property or securities, prohibited by
the foregoing, shall be received by the Trustee before all
Allocable Amounts in respect of Senior Indebtedness is paid in
full, or provision is made for such payment in money in
accordance with its terms, such payment or distribution shall be
held in trust for the benefit of and shall be paid over or
delivered to the holders of such Senior Indebtedness or their
representa-
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tive or representatives, or to the trustee or trustees
under any indenture pursuant to which any instruments evidencing
such Senior Indebtedness may have been issued, and their
respective interests may appear, as calculated by the Company,
for application to the payment of all Senior Indebtedness
remaining unpaid to the extent necessary to pay all Allocable
Amounts in respect of such Senior Indebtedness in full in money
in accordance with its terms, after giving effect to any
concurrent payment or distribution to or for the benefit of the
holders of such Senior Indebtedness.
For purposes of this Article XV, the words "cash,
property or securities" shall not be deemed to include shares of
stock of the Company as reorganized or readjusted, or securities
of the Company or any other corporation provided for by a plan of
reorganization or readjustment, the payment of which is
subordinated at least to the extent provided in this Article XV
with respect to the Securities to the payment of Senior
Indebtedness that may at the time be outstanding, provided that
(i) such Senior Indebtedness is assumed by the new corporation,
if any, resulting from any such reorganization or readjustment,
and (ii) the rights of the holders of such Senior Indebtedness
are not, without the consent of such holders, altered by such
reorganization or readjustment. The consolidation of the Company
with, or the merger of the Company into, another Person or the
liquidation or dissolution of the Company following the sale,
conveyance, transfer or lease of its property as an entirety, or
substantially as an entirety, to another Person upon the terms
and conditions provided for in Article X of this Indenture shall
not be deemed a dissolution, winding-up, liquidation or
reorganization for the purposes of this Section 15.03 if such
other Person shall, as a part of such consolidation, merger,
sale, conveyance, transfer or lease, comply with the conditions
stated in Article X of this Indenture. Nothing in Section 15.02
or in this Section 15.03 shall apply to claims of, or payments
to, the Trustee under or pursuant to Section 6.05 of this
Indenture.
SECTION 15.04. Subrogation.
Subject to the payment in full of all Allocable Amounts
in respect of Senior Indebtedness, the rights of the
Securityholders shall be subrogated to the rights of the holders
of such Senior Indebtedness to receive payments or distributions
of cash, property or securities of the Company, as the case may
be, applicable to such Senior Indebtedness until the principal of
(and premium, if any) and interest on the Securities shall be
paid in full; and, for the purposes of such subrogation, no
payments or distributions to the holders of such Senior
Indebtedness of any cash, property or securities to which the
Securityholders or the Trustee would be entitled except for the
provisions of this Article XV, and no payment over pursuant to
the provisions of this Article XV to or for the benefit of the
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holders of such Senior Indebtedness by Securityholders or the
Trustee, shall, as between the Company, its creditors other than
holders of Senior Indebtedness of the Company, and the holders of
the Securities, be deemed to be a payment by the Company to or on
account of such Senior Indebtedness. It is understood that the
provisions of this Article XV are and are intended solely for the
purposes of defining the relative rights of the holders of the
Securities, on the one hand, and the holders of such Senior
Indebtedness on the other hand.
Nothing contained in this Article XV or elsewhere in
this Indenture or in the Securities is intended to or shall
impair, as between the Company, its creditors other than the
holders of Senior Indebtedness of the Company, and the holders of
the Securities, the obligation of the Company, which is absolute
and unconditional, to pay to the holders of the Securities the
principal of (and premium, if any) and interest on the Securities
as and when the same shall become due and payable in accordance
with their terms, or is intended to or shall affect the relative
rights of the holders of the Securities and creditors of the
Company, as the case may be, other than the holders of Senior
Indebtedness of the Company, as the case may be, nor shall
anything herein or therein prevent the Trustee or the holder of
any Security from exercising all remedies otherwise permitted by
applicable law upon default under the Indenture, subject to the
rights, if any, under this Article XV of the holders of such
Senior Indebtedness in respect of cash, property or securities of
the Company, as the case may be, received upon the exercise of
any such remedy.
Upon any payment or distribution of assets of the
Company referred to in this Article XV, the Trustee, subject to
the provisions of Article VI of this Indenture, and the
Securityholders shall be entitled to conclusively rely upon any
order or decree made by any court of competent jurisdiction in
which such dissolution, winding-up, liquidation or reorganization
proceedings are pending, or a certificate of the receiver,
trustee in bankruptcy, liquidation trustee, agent or other Person
making such payment or distribution, delivered to the Trustee or
to the Securityholders, for the purposes of ascertaining the
Persons entitled to participate in such distribution, the holders
of Senior Indebtedness and other indebtedness of the Company, as
the case may be, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon and all other facts
pertinent thereto or to this Article XV.
SECTION 15.05. Trustee to Effectuate Subordination.
Each Securityholder by such Securityholder's acceptance
thereof authorizes and directs the Trustee on such
Securityholder's behalf to take such action as may be necessary
or appropriate to effectuate the subordination provided in this
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Article XV and appoints the Trustee such Securityholder's
attorney-in-fact for any and all such purposes.
SECTION 15.06. Notice by the Company.
The Company shall give prompt written notice to a
Responsible Officer of the Trustee of any fact known to the
Company that would prohibit the making of any payment of monies
to or by the Trustee in respect of the Securities pursuant to the
provisions of this Article XV. Notwithstanding the provisions of
this Article XV or any other provision of this Indenture, the
Trustee shall not be charged with knowledge of the existence of
any facts that would prohibit the making of any payment of monies
to or by the Trustee in respect of the Securities pursuant to the
provisions of this Article XV, unless and until a Responsible
Officer of the Trustee shall have received written notice thereof
from the Company or a holder or holders of Senior Indebtedness or
from any trustee therefor; and before the receipt of any such
written notice, the Trustee, subject to the provisions of Article
VI of this Indenture, shall be entitled in all respects to assume
that no such facts exist; provided, however, that if the Trustee
shall not have received the notice provided for in this Section
15.06 at least two Business Days prior to the date upon which by
the terms hereof any money may become payable for any purpose
(including, without limitation, the payment of the principal of
(or premium, if any) or interest on any Security), then, anything
herein contained to the contrary notwithstanding, the Trustee
shall have full power and authority to receive such money and to
apply the same to the purposes for which they were received, and
shall not be affected by any notice to the contrary that may be
received by it within two Business Days prior to such date.
The Trustee, subject to the provisions of Article VI of
this Indenture, shall be entitled to conclusively rely on the
delivery to it of a written notice by a Person representing
himself to be a holder of Senior Indebtedness of the Company, as
the case may be (or a trustee on behalf of such holder), to
establish that such notice has been given by a holder of such
Senior Indebtedness or a trustee on behalf of any such holder or
holders. 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 such Senior Indebtedness to participate
in any payment or distribution pursuant to this Article XV, the
Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of such
Senior Indebtedness 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 XV, 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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Upon any payment or distribution of assets of the
Company referred to in this Article XV, the Trustee and the
Securityholders shall be entitled to rely upon any order or
decree entered by any court of competent jurisdiction in which
such insolvency, bankruptcy, receivership, liquidation,
reorganization, dissolution, winding up or similar case or
proceeding is pending, or a certificate of the trustee in
bankruptcy, liquidating trustee, custodian, receiver, assignee
for the benefit of creditors, agent or other person making such
payment or distribution, delivered to the Trustee or to the
Securityholders, for the purpose of ascertaining the persons
entitled to participate in such payment or distribution, the
holders of Senior Indebtedness and other indebtedness of the
Company, the amount thereof or payable thereon, the amount or
amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article XV.
SECTION 15.07. Rights of the Trustee; Holders of Senior
Indebtedness.
The Trustee in its individual capacity shall be
entitled to all the rights set forth in this Article XV in
respect of any Senior Indebtedness at any time held by it, to the
same extent as any other holder of Senior Indebtedness, and
nothing in this Indenture shall deprive the Trustee of any of its
rights as such holder.
With respect to the holders of Senior Indebtedness of
the Company, the Trustee undertakes to perform or to observe only
such of its covenants and obligations as are specifically set
forth in this Article XV, and no implied covenants or obligations
with respect to the holders of such Senior Indebtedness shall be
read into this Indenture against the Trustee. The Trustee shall
not be deemed to owe any fiduciary duty to the holders of such
Senior Indebtedness and, subject to the provisions of Article VI
of this Indenture, the Trustee shall not be liable to any holder
of such Senior Indebtedness if it shall pay over or deliver to
Securityholders, the Company or any other Person money or assets
to which any holder of such Senior Indebtedness shall be entitled
by virtue of this Article XV or otherwise.
Nothing in this Article XV shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 6.06.
SECTION 15.08. Subordination May Not Be Impaired.
No right of any present or future holder of any Senior
Indebtedness of the Company 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 Company, as the
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case may be, or by any act or failure to act, in good faith, by
any such holder, or by any noncompliance by the Company, as the
case may be, with the terms, provisions and covenants of this
Indenture, regardless of any knowledge thereof that any such
holder may have or otherwise be charged with.
Without in any way limiting the generality of the
foregoing paragraph, the holders of Senior Indebtedness of the
Company may, at any time and from time to time, without the
consent of or notice to the Trustee or the Securityholders,
without incurring responsibility to the Securityholders and
without impairing or releasing the subordination provided in this
Article XV or the obligations hereunder of the holders of the
Securities to the holders of such Senior Indebtedness, 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,
such Senior Indebtedness, or otherwise amend or supplement in any
manner such Senior Indebtedness or any instrument evidencing the
same or any agreement under which such Senior Indebtedness is
outstanding; (ii) sell, exchange, release or otherwise deal with
any property pledged, mortgaged or otherwise securing such Senior
Indebtedness; (iii) release any Person liable in any manner for
the collection of such Senior Indebtedness; and (iv) exercise or
refrain from exercising any rights against the Company, as the
case may be, and any other Person.
ARTICLE XVI
EXTENSION OF INTEREST PAYMENT PERIOD
SECTION 16.01. Extension of Interest Payment Period.
So long as no Event of Default has occurred and is
continuing, the Company shall have the right, at any time and
from time to time during the term of the Securities, to defer
payments of interest by extending the interest payment period of
such Securities for a period not exceeding 20 consecutive
quarterly periods, including the first such quarterly period
during such extension period (the "Extended Interest Payment
Period"), during which Extended Interest Payment Period no
interest shall be due and payable; provided that no Extended
Interest Payment Period may extend beyond the Maturity Date. To
the extent permitted by applicable law, interest, the payment of
which has been deferred because of the extension of the interest
payment period pursuant to this Section 16.01, will bear interest
thereon at the Interest Rate then in effect compounded quarterly
for each quarterly period of the Extended Interest Payment Period
("Compounded Interest"). At the end of the Extended Interest
Payment Period, the Company shall pay all interest accrued and
unpaid on the Securities, including any Additional Interest and
Compounded Interest (together, "Deferred Interest") that shall be
payable to the holders of the Securities in whose names the
Securities are registered in the Security Register on the first
record date after the end of the Extended Interest Payment
Period. Before
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the termination of any Extended Interest Payment Period, the Company may
further defer payments of interest by further extending such period,
provided that such period, together with all such previous and further
extensions within such Extended Interest Payment Period, shall not exceed
20 consecutive quarterly periods, including the first such quarterly period
during such Extended Interest Payment Period, or extend beyond the Maturity
Date of the Securities. Upon the termination of any Extended Interest
Payment Period and the payment of all Deferred Interest then due, the
Company may commence a new Extended Interest Payment Period, subject to the
foregoing requirements. No interest shall be due and payable during an
Extended Interest Payment Period, except at the end thereof, but the
Company may prepay at any time all or any portion of the interest accrued
during an Extended Interest Payment Period. Compounded Interest shall be
treated as interest for all purposes under this Indenture.
SECTION 16.02. Notice of Extension.
(a) If the Property Trustee is the only registered
holder of the Securities at the time the Company selects an
Extended Interest Payment Period, the Company shall give written
notice to the Administrative Trustees, the Property Trustee and
the Trustee of its selection of such Extended Interest Payment
Period five Business Days before the earlier of (i) the next
succeeding date on which distributions on the Trust Securities
issued by the Trust are payable, or (ii) the date the Trust is
required to give notice of the record date, or the date such
distributions are payable, to any national securities exchange or
interdealer quotation system or to holders of the Capital
Securities issued by the Trust, but in any event at least five
Business Days before such record date.
(b) If the Property Trustee is not the only holder of
the Securities at the time the Company selects an Extended
Interest Payment Period, the Company shall give the holders of
the Securities and the Trustee written notice of its selection of
such Extended Interest Payment Period at least 10 Business Days
before the earlier of (i) the next succeeding Interest Payment
Date, or (ii) the date the Company is required to give notice of
the record or payment date of such interest payment to any
national securities exchange or interdealer quotation system.
(c) The quarterly period in which any notice is given
pursuant to paragraphs (a) or (b) of this Section 16.02 shall be
counted as one of the 20 quarterly periods permitted in the
maximum Extended Interest Payment Period permitted under Section
16.01.
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The Bank of New York hereby accepts the trusts in this
Indenture declared and provided, upon the terms and conditions
hereinabove set forth.
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed by their respective officers
thereunto duly authorized, as of the day and year first above
written.
BANKBOSTON CORPORATION
By ____________________________
Name:
Title:
THE BANK OF NEW YORK,
as Property Trustee
By ____________________________
Name:
Title:
(Indenture)
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EXHIBIT A
(FORM OF FACE OF SECURITY)
[IF THE SECURITY IS A GLOBAL SECURITY, INSERT: - THIS
SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A
DEPOSITARY OR A NOMINEE OF A DEPOSITARY. THIS SECURITY IS
EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON
OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS
SECURITY (OTHER THAN A TRANSFER OF THIS 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 SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC") TO THE ISSUER OR ITS AGENT FOR REGISTRATION
OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY SECURITY ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL IN AS MUCH AS SINCE THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
No. CUSIP No. ______________
A-1
<PAGE>
BANKBOSTON CORPORATION
FLOATING RATE JUNIOR SUBORDINATED
DEFERRABLE INTEREST DEBENTURE
DUE _______, 2027
BankBoston Corporation, a Massachusetts corporation
(the "Company", which term includes any successor Person under
the Indenture hereinafter referred to), for value received,
hereby promises to pay to The Bank of New York as Property
Trustee for BankBoston Capital Trust III or registered assigns,
the principal sum of _____________ Dollars on _______, 2027 (the
"Maturity Date"), unless previously redeemed, and to pay interest
on the outstanding principal amount hereof from _______, 1997, or
from the most recent interest payment date (each such date, an
"Interest Payment Date") to which interest has been paid or duly
provided for, quarterly (subject to deferral as set forth herein)
in arrears on _______, _______, _______, and _______ of each
year, commencing _______, 1997, at the Interest Rate (as defined
in the Indenture (as defined below)) until the principal hereof
shall have become due and payable, and on any overdue principal
and premium, if any, at the Interest Rate 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 Interest Rate compounded quarterly from the
relevant Interest Payment Date. Interest payable on each
Interest Payment Date shall include interest accrued from and
including the immediately preceding Interest Payment Date (or, if
no interest has been paid or duly provided for, the date of
original issuance) to but excluding such Interest Payment Date
(each, an "Interest Period"). If an Interest Payment Date is not
a Business Day, then such Interest Payment Date and the first day
of the Interest Period commencing on such Interest Payment Date
shall be postponed to the next succeeding Business Day, except if
such Business Day is in the next succeeding calendar month, such
Interest Payment Date and the first day of such Interest Period
will be the immediately preceding Business Day. If the Maturity
Date falls on a day that is not a Business Day, payment of the
interest payable on such date will be made on the next succeeding
day that is a Business Day, and no interest or other payment will
accrue from and after the Maturity Date. The amount of interest
payable for any Interest Period shall be computed on the basis of
the actual number of days elapsed in such period and a year of
360 days.
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, as defined
in said Indenture) is registered at the close of business on the
regular record date for such interest installment, which shall be
the __________, __________, __________ and ___________ prior to
A-2
<PAGE>
the applicable Interest Payment Date. Any such interest
installment not punctually paid or duly provided for shall
forthwith cease to be payable to the holders on such regular
record date and may 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 to be fixed by the
Trustee for the payment of such defaulted interest, notice
whereof shall be given to the holders of Securities not less than
10 days prior to such special record date, or may be paid at any
time in any other lawful manner not inconsistent with the
requirements of any securities exchange or interdealer quotation
system on which the Securities may be listed, and upon such
notice as may be required by such exchange or interdealer
quotation system, all as more fully provided in the Indenture.
The principal of (and premium, if any) and interest on
this Security shall be payable at the office or agency of the
Trustee maintained for that purpose in any coin or currency of
the United States of America that at the time of payment is legal
tender for payment of public and private debts; provided,
however, that, payment of interest may be made at the option of
the Company by (i) check mailed to the holder at such address as
shall appear in the Security Register or (ii) by transfer to an
account maintained by the Person entitled thereto, provided that
proper written transfer instructions have been received by the
relevant record date. Notwithstanding the foregoing, so long as
the Holder of this Security is the Property Trustee, the payment
of the principal of (and premium, if any) and interest on this
Security will be made at such place and to such account as may be
designated by the Property Trustee.
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 Allocable Amounts
in respect of Senior Indebtedness, and this Security is issued
subject to the provisions of the Indenture with respect thereto.
Each holder of this Security, by accepting the same, (a) agrees
to and shall be bound by such provisions, (b) 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 so provided and (c) appoints the Trustee his or her
attorney-in-fact for any and all such purposes. Each holder
hereof, by his or her acceptance hereof, hereby waives all notice
of the acceptance of the subordination provisions contained
herein and in the Indenture by each holder of Senior
Indebtedness, whether now outstanding or hereafter incurred, and
waives reliance by each such holder upon said provisions.
A-3
<PAGE>
This Security shall not be entitled to any benefit
under the Indenture hereinafter referred to, be valid or become
obligatory for any purpose until the Certificate of
Authentication hereon shall have been signed by or on behalf of
the Trustee.
THIS SECURITY IS NOT A SAVINGS OR DEPOSIT ACCOUNT OR
OTHER OBLIGATION OF A BANK AND IS NOT INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.
The provisions of this Security are continued on the
reverse side hereof and such provisions shall for all purposes
have the same effect as though fully set forth at this place.
IN WITNESS WHEREOF, the Company has caused this
instrument to be executed.
BANKBOSTON CORPORATION
By: ____________________________
Name:
Title
Attest:
By: _______________________
Name:
Title:
(FORM OF CERTIFICATE OF AUTHENTICATION)
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
A-4
<PAGE>
(FORM OF REVERSE OF SECURITY)
This Security is one of the Securities of the Company
(herein sometimes referred to as the "Securities"), specified in
the Indenture, all issued or to be issued under and pursuant to
an Indenture, dated as of _______, 1997 (the "Indenture"), duly
executed and delivered between the Company and The Bank of New
York, as Trustee (the "Trustee"), to which Indenture reference is
hereby made for a description of the rights, limitations of
rights, obligations, duties and immunities thereunder of the
Trustee, the Company and the holders of the Securities.
Upon the occurrence and continuation of a Special
Event, the Company shall have the right to redeem this Security
in whole (but not in part) at the Redemption Price. "Redemption
Price" shall mean, with respect to any redemption of the
Securities, an amount in cash equal to 100% of the principal
amount of Securities to be redeemed plus any accrued and unpaid
interest thereon, including Compounded Interest and Additional
Interest, if any, to the date of such redemption.
In addition, the Company shall have the right to redeem
this Security, in whole or in part, at any time on or after
_______, 2007 (an "Optional Redemption"), at the Redemption
Price.
The Redemption Price shall be paid prior to 12:00 noon,
New York time, on the date of such redemption or at such earlier
time as the Company determines, provided, that the Company shall
deposit with the Trustee an amount sufficient to pay the
Redemption Price by 10:00 a.m., New York City time, on the date
such Redemption Price is to be paid. Any redemption pursuant to
this paragraph will be made upon not less than 30 days nor more
than 60 days notice. If the Securities are only partially
redeemed by the Company pursuant to an Optional Redemption, the
Securities will be redeemed pro rata or by lot or by any other
method utilized by the Trustee; provided that if, at the time of
redemption, the Securities are registered as a Global Security,
the Depositary shall determine the particular Securities to be
redeemed in accordance with its procedures.
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.
Notwithstanding the foregoing, any redemption of
Securities by the Company shall be subject to the prior approval
of the Board of Governors of the Federal Reserve System (the
"Federal Reserve"), if such approval is then required under
capital guidelines or policies of the Federal Reserve.
A-5
<PAGE>
In case an Event of Default, as defined in the
Indenture, shall have occurred and be continuing, the principal
of all of the Securities may be declared, and upon such
declaration shall become, due and payable, in the manner, with
the effect and subject to the conditions provided in the
Indenture.
The Indenture contains provisions permitting the
Company and the Trustee, with the consent of the holders of a
majority in aggregate principal amount of the Securities at the
time outstanding, as defined in the Indenture, to execute
supplemental indentures for the purpose of adding any provisions
to or changing in any manner or eliminating any of the provisions
of the Indenture or of modifying in any manner the rights of the
holders of the Securities; provided, however, that no such
supplemental indenture shall, without the consent of each holder
of Securities then outstanding and affected thereby, (i) extend
the Maturity Date of any Securities, or reduce the principal
amount thereof, or reduce any amount payable on redemption
thereof, or reduce the rate or extend the time of payment of
interest thereon (subject to Article XVI of the Indenture), or
make the principal of, or interest or premium on, the Securities
payable in any coin or currency other than U.S. dollars, or
impair or affect the right of any holder of Securities to
institute suit for the payment thereof, or (ii) reduce the
aforesaid percentage of Securities, the holders of which are
required to consent to any such supplemental indenture. The
Indenture also contains provisions permitting the holders of a
majority in aggregate principal amount of the Securities at the
time outstanding affected thereby, on behalf of all of the
holders of the Securities, to waive any past default in the
performance of any of the covenants contained in the Indenture,
or established pursuant to the Indenture, and its consequences,
except a default in the payment of the principal of or premium,
if any, or interest on any of the Securities or a default in
respect of any covenant or provision under which the Indenture
cannot be modified or amended without the consent of each holder
of Securities then outstanding. Any such consent or waiver by
the holder of this Security (unless revoked as provided in the
Indenture) shall be conclusive and binding upon such Holder and
upon all future holders and owners of this Security and of any
Security issued in exchange heretofore or in place hereof
(whether by registration of transfer or otherwise), irrespective
of whether or not any notation of such consent or waiver is made
upon this Security.
No reference herein to the Indenture and no provision
of this Security or of the Indenture shall alter or impair the
obligation of the Company, which is absolute and unconditional,
to pay the principal of and premium, if any, and interest on this
Security at the time and place and at the rate and in the money
herein prescribed.
A-6
<PAGE>
So long as no Event of Default has occurred and is
continuing, the Company shall have the right, at any time and
from time to time during the term of the Securities, to defer
payments of interest by extending the interest payment period of
such Securities for a period not exceeding 20 consecutive
quarterly periods, including the first such quarterly period
during such extension period (an "Extended Interest Payment
Period"), at the end of which period the Company shall pay all
interest then accrued and unpaid (together with interest thereon
at the Interest Rate to the extent that payment of such interest
is enforceable under applicable law); provided that no Extended
Interest Payment Period may extend beyond the Maturity Date.
Before the termination of any such Extended Interest Payment
Period, the Company may further defer payments of interest by
further extending such Extended Interest Payment Period, provided
that such Extended Interest Payment Period, together with all
such previous and further extensions within such Extended
Interest Payment Period, shall not exceed 20 consecutive
quarterly periods, including the first quarterly period during
such Extended Interest Payment Period, or extend beyond the
Maturity Date of the Securities. Upon the termination of any
such Extended Interest Payment Period and the payment of all
accrued and unpaid interest and any additional amounts then due,
the Company may commence a new Extended Interest Payment Period,
subject to the foregoing requirements.
The Company has agreed that it will not (i) declare or
pay any dividends or distributions on, or redeem, purchase,
acquire, or make a liquidation payment with respect to, any of
the Company's capital stock (which includes common and preferred
stock) or (ii) make any payment of principal, interest or
premium, if any, on or repay or repurchase or redeem any debt
securities of the Company that rank pari passu with or junior in
right of payment to the Securities or make any guarantee payments
with respect to any guarantee by the Company of the debt
securities or any Subsidiary of the Company if such guarantee
ranks pari passu or junior in right of payment to the Securities
(other than (a) dividends or distributions in shares of, or
options, warrants or rights to subscribe for or purchase shares
of, Common Stock of the Company, (b) any declaration of a
dividend in connection with the implementation of a stockholder's
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 Capital Securities
Guarantee (d) as a result of a reclassification of the Company's
capital stock or the exchange or the conversion of one class or
series of the Company's capital stock for another class or series
of the Company's capital stock (e) the purchase of fractional
interests in shares of the Company's capital stock pursuant to
the exchange or conversion of such capital stock or the security
being exchanged or converted and (f) purchases of Common Stock
related to the issuance of Common Stock or rights under any of
the Company's
A-7
<PAGE>
benefit plans for its directors, officers or employees or any of the
Company's dividend reinvestment plans) if at such time (i) there shall have
occurred any event of which the Company has actual knowledge that (a) is,
or with the giving of notice or the lapse of time, or both, would be, an
Event of Default and (b) in respect of which the Company shall not have
taken reasonable steps to cure, (ii) if such Securities are held by the
Trust, the Company shall be in default with respect to its payment of any
obligations under the Capital Securities Guarantee or (iii) the Company
shall have given notice of its election of the exercise of its right to
extend the interest payment period and any such extension shall be
continuing.
Subject to the prior approval of the Federal Reserve if
such approval is then required under capital guidelines or
policies of the Federal Reserve, the Company will have the right
at any time to liquidate the Trust and cause the Securities to be
distributed to the holders of the Trust Securities in liquidation
of the Trust.
The Securities are issuable only in registered form
without coupons in denominations of $1,000.00 and any integral
multiple thereof. As provided in the Indenture and subject to
certain limitations therein set forth, this Security is
transferable by the holder hereof on the Security Register of the
Company, upon surrender of this Security for registration of
transfer at the office or agency of the Trustee in the City and
State of New York accompanied by a written instrument or
instruments of transfer in form satisfactory to the Company or
the Trustee 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 will be made for any such
transfer, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge payable in relation
thereto.
Prior to due presentment for registration of transfer
of this Security, the Company, the Trustee, any paying agent and
the registrar may deem and treat the holder hereof as the
absolute owner hereof (whether or not this Security shall be
overdue and notwithstanding any notice of ownership or writing
hereon made by anyone other than the Security registrar) for the
purpose of receiving payment of or on account of the principal
hereof and premium, if any, and interest due hereon and for all
other purposes, and neither the Company nor the Trustee nor any
paying agent nor any registrar shall be affected by any notice to
the contrary.
No recourse shall be had for the payment of the
principal of or premium, if any, or interest on this Security, or
for any claim based hereon, or otherwise in respect hereof, or
based
A-8
<PAGE>
on or in respect of the Indenture, against any incorporator, stockholder,
officer or director, past, present or future, as such, of the Company or of
any predecessor or successor Person, whether by virtue of any constitution,
statute or rule of law, or by the enforcement of any assessment or penalty
or otherwise, all such liability being, by the acceptance hereof and as
part of the consideration for the issuance hereof, expressly waived and
released.
All terms used in this Security that are defined in the
Indenture shall have the meanings assigned to them in the
Indenture.
THE INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK WITHOUT REGARD TO CONFLICT OF LAW PROVISIONS THEREOF.
A-9
<PAGE>
EXHIBIT 4.5
AMENDED AND RESTATED DECLARATION
OF TRUST
BANKBOSTON CAPITAL TRUST III
Dated as of _______, 1997
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Definitions . . . . . . . . . . . . . . . . . 2
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application . . . . . . 9
SECTION 2.2 Lists of Holders of Securities . . . . . . . 9
SECTION 2.3 Reports by the Property Trustee . . . . . . . 10
SECTION 2.4 Periodic Reports to Property Trustee . . . . 10
SECTION 2.5 Evidence of Compliance with Conditions
Precedent . . . . . . . . . . . . . . . . . . 10
SECTION 2.6 Events of Default; Waiver . . . . . . . . . . 10
SECTION 2.7 Event of Default; Notice . . . . . . . . . . 12
ARTICLE III
ORGANIZATION
SECTION 3.1 Name . . . . . . . . . . . . . . . . . . . . 13
SECTION 3.2 Office . . . . . . . . . . . . . . . . . . . 13
SECTION 3.3 Purpose . . . . . . . . . . . . . . . . . . . 14
SECTION 3.4 Authority . . . . . . . . . . . . . . . . . . 14
SECTION 3.5 Title to Property of the Trust . . . . . . . 14
SECTION 3.6 Powers and Duties of the Administrative
Trustees . . . . . . . . . . . . . . . . . . 14
SECTION 3.7 Prohibition of Actions by the Trust and the
Trustees . . . . . . . . . . . . . . . . . . 18
SECTION 3.8 Powers and Duties of the Property Trustee . . 19
SECTION 3.9 Certain Duties and Responsibilities of the
Property Trustee . . . . . . . . . . . . . . 21
SECTION 3.10 Certain Rights of Property Trustee . . . . . 23
SECTION 3.11 Delaware Trustee . . . . . . . . . . . . . . 26
SECTION 3.12 Execution of Documents . . . . . . . . . . . 26
SECTION 3.13 Not Responsible for Recitals or Issuance of
Securities . . . . . . . . . . . . . . . . . 26
SECTION 3.14 Duration of Trust . . . . . . . . . . . . . . 26
SECTION 3.15 Mergers . . . . . . . . . . . . . . . . . . . 26
ARTICLE IV
SPONSOR
SECTION 4.1 Sponsor's Purchase of Common Securities . . . 28
SECTION 4.2 Responsibilities of the Sponsor . . . . . . . 28
SECTION 4.3 Right to Proceed . . . . . . . . . . . . . . 29
ARTICLE V
TRUSTEES
i
<PAGE>
SECTION 5.1 Number of Trustees: Appointment of Co-
Trustee . . . . . . . . . . . . . . . . . . . 29
SECTION 5.2 Delaware Trustee . . . . . . . . . . . . . . 30
SECTION 5.3 Property Trustee; Eligibility . . . . . . . . 30
SECTION 5.4 Certain Qualifications of Administrative
Trustees and Delaware Trustee Generally . . . 32
SECTION 5.5 Administrative Trustees . . . . . . . . . . . 32
SECTION 5.6 Delaware Trustee. . . . . . . . . . . . . . . 32
SECTION 5.7 Appointment, Removal and Resignation of
Trustees . . . . . . . . . . . . . . . . . . 33
Page
SECTION 5.8 Vacancies among Trustees . . . . . . . . . . 34
SECTION 5.9 Effect of Vacancies . . . . . . . . . . . . . 34
SECTION 5.10 Meetings . . . . . . . . . . . . . . . . . . 35
SECTION 5.11 Delegation of Power . . . . . . . . . . . . . 35
Section 5.12 Merger, Conversion, Consolidation or
Succession to Business . . . . . . . . . . . 36
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 Distributions . . . . . . . . . . . . . . . . 36
ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 General Provisions Regarding Securities . . . 37
SECTION 7.2 Execution and Authentication . . . . . . . . 37
SECTION 7.3 Form and Dating . . . . . . . . . . . . . . . 38
SECTION 7.4 Registrar and Paying Agent . . . . . . . . . 40
SECTION 7.5 Paying Agent to Hold Money in Trust . . . . . 40
SECTION 7.6 Replacement Securities . . . . . . . . . . . 40
SECTION 7.7 Outstanding Capital Securities . . . . . . . 41
SECTION 7.8 Capital Securities in Treasury . . . . . . . 41
SECTION 7.9 Temporary Securities . . . . . . . . . . . . 41
SECTION 7.10 Cancellation . . . . . . . . . . . . . . . . 43
ARTICLE VIII
TERMINATION OF TRUST
SECTION 8.1 Termination of Trust . . . . . . . . . . . . 43
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 Transfer of Securities . . . . . . . . . . . 44
SECTION 9.2 Transfer Procedures and Restrictions . . . . 45
SECTION 9.3 Deemed Security Holders . . . . . . . . . . . 49
SECTION 9.4 Book Entry Interests . . . . . . . . . . . . 49
SECTION 9.5 Notices to Clearing Agency . . . . . . . . . 50
SECTION 9.6 Appointment of Successor Clearing Agency . . 50
ii
<PAGE>
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 Liability . . . . . . . . . . . . . . . . . . 50
SECTION 10.2 Exculpation . . . . . . . . . . . . . . . . . 51
SECTION 10.3 Fiduciary Duty . . . . . . . . . . . . . . . 51
SECTION 10.4 Indemnification . . . . . . . . . . . . . . . 52
SECTION 10.5 Outside Businesses . . . . . . . . . . . . . 56
ARTICLE XI
ACCOUNTING
SECTION 11.1 Fiscal Year . . . . . . . . . . . . . . . . . 56
SECTION 11.2 Certain Accounting Matters . . . . . . . . . 56
SECTION 11.3 Banking . . . . . . . . . . . . . . . . . . . 57
SECTION 11.4 Withholding . . . . . . . . . . . . . . . . . 57
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 Amendments . . . . . . . . . . . . . . . . . 58
SECTION 12.2 Meetings of the Holders of Securities;
Action by Written Consent . . . . . . . . . . 60
ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
SECTION 13.1 Representations and Warranties of Property
Trustee . . . . . . . . . . . . . . . . . . . 62
SECTION 13.2 Representations and Warranties of Delaware
Trustee . . . . . . . . . . . . . . . . . . . 63
ARTICLE XIV
MISCELLANEOUS
SECTION 14.1 Notices . . . . . . . . . . . . . . . . . . . 63
SECTION 14.2 Governing Law . . . . . . . . . . . . . . . . 65
SECTION 14.3 Intention of the Parties . . . . . . . . . . 65
SECTION 14.4 Headings . . . . . . . . . . . . . . . . . . 65
SECTION 14.5 Successors and Assigns . . . . . . . . . . . 65
SECTION 14.6 Partial Enforceability . . . . . . . . . . . 65
SECTION 14.7 Counterparts . . . . . . . . . . . . . . . . 65
ANNEX I TERMS OF SECURITIES . . . . . . . . . . . . . I-1
EXHIBIT A-1 FORM OF CAPITAL SECURITY CERTIFICATE . . . A1-1
EXHIBIT A-2 FORM OF COMMON SECURITY CERTIFICATE . . . . A2-1
EXHIBIT B SPECIMEN OF DEBENTURE . . . . . . . . . . . . B-1
EXHIBIT C PURCHASE AGREEMENT . . . . . . . . . . . . . C-1
iii
<PAGE>
CROSS-REFERENCE TABLE*
Section of
Trust Indenture Act Section of
of 1939, as amended Declaration
310(a) . . . . . . . . . . . . . . . . .
310(c) . . . . . . . . . . . . . . . . .
311(c) . . . . . . . . . . . . . . . . .
312(a) . . . . . . . . . . . . . . . . .
312(b) . . . . . . . . . . . . . . . . .
313 . . . . . . . . . . . . . . . . . . .
314(a) . . . . . . . . . . . . . . . . .
314(b) . . . . . . . . . . . . . . . . .
314(c) . . . . . . . . . . . . . . . . .
314(d) . . . . . . . . . . . . . . . . .
314(f) . . . . . . . . . . . . . . . . .
315(a) . . . . . . . . . . . . . . . . .
315(c) . . . . . . . . . . . . . . . . .
315(d) . . . . . . . . . . . . . . . . .
316(a) . . . . . . . . . . . . . . . . .
316(c) . . . . . . . . . . . . . . . . .
_______________
* This Cross-Reference Table does not constitute part
of the Declaration and shall not affect the
interpretation of any of its terms or provisions.
iv
<PAGE>
AMENDED AND RESTATED
DECLARATION OF TRUST
OF
BANKBOSTON CAPITAL TRUST III
_______, 1997
AMENDED AND RESTATED DECLARATION OF TRUST
("Declaration") dated and effective as of _______, 1997, by the
Trustees (as defined herein), the Sponsor (as defined herein) and
by the holders, from time to time, of undivided beneficial
interests in the Trust to be issued pursuant to this Declaration;
WHEREAS, the Trustees and the Sponsor established
BankBoston Capital Trust III (the "Trust"), a trust formed under
the Delaware Business Trust Act pursuant to a Declaration of
Trust dated as of May 14, 1997 (the "Original Declaration"), and
a Certificate of Trust filed with the Secretary of State of the
State of Delaware on May 14, 1997, for the sole purpose of
issuing and selling certain securities representing undivided
beneficial interests in the assets of the Trust and investing the
proceeds thereof in certain Debentures of the Debenture Issuer
(each as hereinafter defined);
WHEREAS, as of the date hereof, no interests in the
Trust have been issued;
WHEREAS, all of the Trustees and the Sponsor, by this
Declaration, amend and restate each and every term and provision
of the Original Declaration; and
NOW, THEREFORE, it being the intention of the parties
hereto to continue the Trust as a business trust under the
Business Trust Act, that the Original Declaration be amended and
restated in its entirety as provided herein and that this
Declaration constitute the governing instrument of such business
trust, the Trustees declare that all assets contributed to the
Trust will be held in trust for the benefit of the holders, from
time to time, of the securities representing undivided beneficial
interests in the assets of the Trust issued hereunder, subject to
the provisions of this Declaration.
<PAGE>
ARTICLE I
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Definitions.
Unless the context otherwise requires:
(a) Capitalized terms used in this Declaration but not
defined in the preamble above have the respective meanings
assigned to them in this Section 1.1;
(b) a term defined anywhere in this Declaration has
the same meaning throughout;
(c) all references to "the Declaration" or "this
Declaration" are to this Declaration as modified,
supplemented or amended from time to time;
(d) all references in this Declaration to Articles and
Sections and Annexes and Exhibits are to Articles and
Sections of and Annexes and Exhibits to this Declaration
unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the
same meaning when used in this Declaration unless otherwise
defined in this Declaration or unless the context otherwise
requires; and
(f) a reference to the singular includes the plural
and vice versa.
"Administrative Trustee" has the meaning set forth in
Section 5.1.
"Affiliate" has the same meaning as given to that term
in Rule 405 under the Securities Act or any successor rule
thereunder.
"Agent" means any Paying Agent or Registrar.
"Authorized Officer" of a Person means any other Person
that is authorized to legally bind such former Person.
"Book Entry Interest" means a beneficial interest in a
Global Certificate registered in the name of a Clearing Agency or
its nominee, ownership and transfers of which shall be maintained
and made through book entries by a Clearing Agency as described
in Section 9.4.
"Business Day" means any day other than a Saturday or a
Sunday or a day on which banking institutions in the City of New
2
<PAGE>
York or Boston, Massachusetts are authorized or required by law
or executive order to close.
"Business Trust Act" means Chapter 38 of Title 12 of
the Delaware Code, 12 Del. Code SECTION3801 et seq., as it may be
amended from time to time, or any successor legislation.
"Capital Security Beneficial Owner" means, with respect
to a Book Entry Interest, a Person who is the beneficial owner of
such Book Entry Interest, as reflected on the books of the
Clearing Agency, or on the books of a Person maintaining an
account with such Clearing Agency (directly as a Clearing Agency
Participant or as an indirect participant, in each case in
accordance with the rules of such Clearing Agency).
"Capital Securities" has the meaning specified in
Section 7.1(a).
"Capital Securities Guarantee" means the guarantee
agreement dated as of _______, 1997 of Sponsor in respect of the
Capital Securities.
"Clearing Agency" means an organization registered as a
"Clearing Agency" pursuant to Section 17A of the Exchange Act
that is acting as depositary for the Capital Securities and in
whose name or in the name of a nominee of that organization shall
be registered a Global Certificate and which shall undertake to
effect book-entry transfers and pledges of the Capital
Securities.
"Clearing Agency Participant" means a broker, dealer,
bank, other financial institution or other Person for whom from
time to time the Clearing Agency effects book entry transfers and
pledges of securities deposited with the Clearing Agency.
"Closing Time" means the "Closing Time" under the
Purchase Agreement.
"Code" means the Internal Revenue Code of 1986, as
amended from time to time, or any successor legislation.
"Commission" means the United States Securities and
Exchange Commission as from time to time constituted, or if any
time after the execution of this Declaration such Commission is
not existing and performing the duties now assigned to it under
applicable Federal securities laws, then the body performing such
duties at such time.
"Common Securities" has the meaning specified in
Section 7.1(a).
3
<PAGE>
"Common Securities Guarantee" means the guarantee
agreement dated as of _______, 1997 of the Sponsor in respect of
the Common Securities.
"Company Indemnified Person" means (a) any
Administrative Trustee; (b) any Affiliate of any Administrative
Trustee; (c) any officers, directors, shareholders, members,
partners, employees, representatives or agents of any
Administrative Trustee; or (d) any officer, employee or agent of
the Trust or its Affiliates.
"Corporate Trust Office" means the office of the
Property Trustee at which the corporate trust business of the
Property Trustee shall, at any particular time, be principally
administered, which office at the date of execution of this
Agreement is located at 101 Barclay Street, 21 West, New York,
New York 10286.
"Covered Person" means: (a) any officer, director,
shareholder, partner, member, representative, employee or agent
of (i) the Trust or (ii) the Trust's Affiliates; and (b) any
Holder of Securities.
"Debenture Issuer" means BankBoston Corporation, a
Massachusetts corporation, or any successor entity resulting from
any consolidation, amalgamation, merger or other business
combination, in its capacity as issuer of the Debentures under
the Indenture.
"Debenture Trustee" means The Bank of New York, a New
York banking corporation, as trustee under the Indenture until a
successor is appointed thereunder, and thereafter means such
successor trustee.
"Debentures" means the Floating Rate Junior
Subordinated Deferrable Interest Debentures due ______, 2027 of
the Debenture Issuer issued pursuant to the Indenture.
"Default" means an event, act or condition that with
notice of lapse of time, or both, would constitute an Event of
Default.
"Definitive Capital Securities" shall have the meaning
set forth in Section 7.3(c).
"Delaware Trustee" has the meaning set forth in Section
5.2.
"Direct Action" shall have the meaning set forth in
Section 3.8(e).
4
<PAGE>
"Distribution" means a distribution payable to Holders
of Securities in accordance with Section 6.1.
"DTC" means The Depository Trust Company, the initial
Clearing Agency.
"Event of Default" in respect of the Securities means
an Event of Default (as defined in the Indenture) that has
occurred and is continuing in respect of the Debentures.
"Exchange Act" means the Securities Exchange Act of
1934, as amended from time to time, or any successor legislation.
"Federal Reserve Board" means the Board of Governors of
the Federal Reserve System.
"Fiduciary Indemnified Person" has the meaning set
forth in Section 10.4(b).
"Global Capital Securities" has the meaning set forth
in Section 7.3(a).
"Holder" means a Person in whose name a Security is
registered, such Person being a beneficial owner within the
meaning of the Business Trust Act.
"Indemnified Person" means a Company Indemnified Person
or a Fiduciary Indemnified Person.
"Indenture" means the Indenture dated as of _______,
1997, among the Debenture Issuer and the Debenture Trustee, as
amended from time to time.
"Investment Company" means an investment company as
defined in the Investment Company Act.
"Investment Company Act" means the Investment Company
Act of 1940, as amended from time to time, or any successor
legislation.
"Legal Action" has the meaning set forth in Section
3.6(g).
"Majority in liquidation amount" means, with respect to
the Trust Securities, except as provided in the terms of the
Capital Securities or by the Trust Indenture Act, Holder(s) of
outstanding Trust Securities voting together as a single class
or, as the context may require, Holders of outstanding Capital
Securities or Holders of outstanding Common Securities voting
separately as a class, who are the record owners of more than 50%
of the aggregate liquidation amount (including the stated amount
that would be paid on redemption, liquidation or otherwise, plus
5
<PAGE>
accrued and unpaid Distributions to the date upon which the
voting percentages are determined) of all outstanding Securities
of the relevant class.
"Ministerial Action" has the meaning set forth in Annex
I hereto.
"Officers' Certificate" means, with respect to any
Person, a certificate signed by the Chairman, a Vice Chairman,
the Chief Executive Officer, the President, a Vice President, the
Comptroller, the Executive Director, Global Treasury, the Clerk
or an Assistant Clerk, or the Secretary or an Assistant Secretary
of such Person. Any Officers' Certificate delivered with respect
to compliance with a condition or covenant provided for in this
Declaration shall include:
(a) a statement that each officer signing the
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 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" shall mean a written opinion of
counsel, who may be an employee of the Sponsor, and who shall be
acceptable to the Property Trustee.
"Paying Agent" has the meaning specified in Section
7.4.
"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.
"Property Trustee" has the meaning set forth in Section
5.3(a).
"Property Trustee Account" has the meaning set forth in
Section 3.8(c).
6
<PAGE>
"Purchase Agreement" means the Purchase Agreement for
the offering and sale of Capital Securities in the form of
Exhibit C.
"Quorum" means a majority of the Administrative
Trustees or, if there are only two Administrative Trustees, both
of them.
"Registrar" has the meaning set forth in Section 7.4.
"Regulatory Capital Event" means that the Debenture
Issuer shall have received an opinion of independent bank
regulatory counsel experienced in such matters to the effect
that, as a result of (a) any amendment to, or change (including
any announced prospective change) in, the laws (or any
regulations thereunder) of the United States or any rules,
guidelines or policies of the Federal Reserve Board or (b) 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 original issuance
of the Capital Securities, the Capital Securities do not
constitute, or within 90 days of the date thereof, will not
constitute, Tier I Capital (or its then equivalent); provided,
however, that the distribution of the Capital Securities in
connection with the liquidation of the Trust by the Sponsor,
shall not in and of itself constitute a Regulatory Capital Event
unless such liquidation shall have occurred in connection with a
Tax Event.
"Related Party" means, with respect to the Sponsor, any
direct or indirect wholly owned subsidiary of the Sponsor or any
other Person that owns, directly or indirectly, 100% of the
outstanding voting securities of the Sponsor.
"Responsible Officer" means, with respect to the
Property Trustee, any officer within the Corporate Trust Office
of the Property Trustee, including any vice-president, any
assistant vice-president, any assistant secretary, any assistant
treasurer or other officer of the Corporate Trust Office of the
Property Trustee customarily performing functions similar to
those performed by any of the above designated officers 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.
"Rule 3a-5" means Rule 3a-5 under the Investment
Company Act, or any successor rule or regulation.
"Securities" or "Trust Securities" means the Common
Securities and the Capital Securities.
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"Securities Act" means the Securities Act of 1933, as
amended from time to time, or any successor legislation.
"Securities Guarantees" means the Common Securities
Guarantee and the Capital Securities Guarantee.
"Special Event" means either a Regulatory Capital Event
or a Tax Event.
"Sponsor" means BankBoston Corporation, a Massachusetts
corporation, or any successor entity resulting from any merger,
consolidation, amalgamation or other business combination, in its
capacity as sponsor of the Trust.
"Super Majority" has the meaning set forth in Section
2.6(a)(ii).
"Tax Event" shall mean the receipt by the Trust and the
Debenture 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 _______, 1997,
there is more than an insubstantial risk that (i) the Trust 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 Debentures, (ii) interest payable by the
Debenture Issuer on the Debentures is not, or within 90 days of
the date of such opinion, will not be, deductible by the
Debenture Issuer, in whole or in part, for United States Federal
income tax purposes, or (iii) the Trust is, or will be within 90
days of the date of such opinion, subject to more than a de
minimis amount of other taxes, duties or other governmental
charges.
"10% in liquidation amount" means, with respect to the
Trust Securities, except as provided in the terms of the Capital
Securities or by the Trust Indenture Act, Holder(s) of
outstanding Trust Securities voting together as a single class
or, as the context may require, Holders of outstanding Capital
Securities or Holders of outstanding Common Securities voting
separately as a class, who are the record owners of 10% or more
of the aggregate liquidation amount (including the stated amount
that would be paid on redemption, liquidation or otherwise, plus
accrued and unpaid Distributions to the date upon which the
voting percentages are determined) of all outstanding Securities
of the relevant class.
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"Treasury Regulations" means the income tax
regulations, including temporary and proposed regulations,
promulgated under the Code by the United States Treasury, as such
regulations may be amended from time to time (including
corresponding provisions of succeeding regulations).
"Trustee" or "Trustees" means each Person who has
signed this Declaration as a trustee, so long as such Person
shall continue in office in accordance with the terms hereof, and
all other Persons who may from time to time be duly appointed,
qualified and serving as Trustees in accordance with the
provisions hereof, and references herein to a Trustee or the
Trustees shall refer to such Person or Persons solely in their
capacity as trustees hereunder.
"Trust Indenture Act" means the Trust Indenture Act of
1939, as amended from time to time, or any successor legislation.
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application.
(a) This Declaration is subject to the provisions of
the Trust Indenture Act that are required to be part of this
Declaration 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 and to the extent that any provision of this
Declaration limits, qualifies or conflicts with the duties
imposed by SECTIONSECTION 310 to 317, inclusive, of the Trust
Indenture Act, such imposed duties shall control.
(d) The application of the Trust Indenture Act to
this Declaration shall not affect the nature of the Securities as
equity securities representing undivided beneficial interests in
the assets of the Trust.
SECTION 2.2 Lists of Holders of Securities.
(a) Each of the Sponsor and the Administrative
Trustees on behalf of the Trust shall provide the Property
Trustee, unless the Property Trustee is Registrar for the
Securities (i) within 14 days after November 15 and May 15 of
each year, a list, in such form as the Property Trustee may
reasonably require, of the names and addresses of the Holders of
the Securities ("List of Holders") as of such record date,
provided that neither the Sponsor nor the Administrative Trustees
on behalf of
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the Trust shall be obligated to provide such List of
Holders at any time the List of Holders does not differ from the
most recent List of Holders given to the Property Trustee by the
Sponsor and the Administrative Trustees on behalf of the Trust,
and (ii) at any other time, within 30 days of receipt by the
Trust of a written request for a List of Holders as of a date no
more than 14 days before such List of Holders is given to the
Property Trustee. The Property Trustee shall preserve, in as
current a form as is reasonably practicable, all information
contained in Lists of Holders given to it or which it receives in
the capacity as Paying Agent (if acting in such capacity),
provided that the Property Trustee may destroy any List of
Holders previously given to it on receipt of a new List of
Holders.
(b) The Property Trustee shall comply with its
obligations under SECTIONSECTION 311(a), 311(b) and 312(b) of the Trust
Indenture Act.
SECTION 2.3 Reports by the Property Trustee.
Within 60 days after December 15 of each year,
commencing December 15, 1997, the Property Trustee shall provide
to the Holders of the Capital Securities 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 Property Trustee shall also comply with the requirements of SECTION
313(d) of the Trust Indenture Act.
SECTION 2.4 Periodic Reports to Property Trustee.
Each of the Sponsor and the Administrative Trustees on
behalf of the Trust shall provide to the Property Trustee such
documents, reports and information as are required by SECTION 314 (if
any) 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.
Each of the Sponsor and the Administrative Trustees on
behalf of the Trust shall provide to the Property Trustee such
evidence of compliance with any conditions precedent provided for
in this Declaration 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 may be given in the form of
an Officers' Certificate.
SECTION 2.6 Events of Default; Waiver.
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(a) The Holders of a Majority in liquidation amount
of Capital Securities may, by vote, on behalf of the Holders of
all of the Capital Securities, waive any past Event of Default in
respect of the Capital Securities and its consequences, provided
that, if the underlying Event of Default under the Indenture:
(i) is not waivable under the Indenture, the Event
of Default under the Declaration shall also not be waivable;
or
(ii) requires the consent or vote of greater than a
majority in aggregate principal amount of the holders of the
Debentures (a "Super Majority") to be waived under the
Indenture, the Event of Default under the Declaration may
only be waived by the vote of the Holders of at least the
proportion in aggregate liquidation amount of the Capital
Securities that the relevant Super Majority represents of
the aggregate principal amount of the Debentures
outstanding.
The foregoing provisions of this Section 2.6(a) shall be in lieu
of SECTION 316(a)(1)(B) of the Trust Indenture Act and such
SECTION 316(a)(1)(B) of the Trust Indenture Act is hereby expressly
excluded from this Declaration and the Securities, as permitted
by the Trust Indenture Act. Upon such waiver, any such default
shall cease to exist, and any Event of Default with respect to
the Capital Securities arising therefrom shall be deemed to have
been cured, for every purpose of this Declaration, but no such
waiver shall extend to any subsequent or other default or an
Event of Default with respect to the Capital Securities or impair
any right consequent thereon. Any waiver by the Holders of the
Capital Securities of an Event of Default with respect to the
Capital Securities shall also be deemed to constitute a waiver by
the Holders of the Common Securities of any such Event of Default
with respect to the Common Securities for all purposes of this
Declaration without any further act, vote, or consent of the
Holders of the Common Securities.
(b) The Holders of a Majority in liquidation amount
of the Common Securities may, by vote, on behalf of the Holders
of all of the Common Securities, waive any past Event of Default
with respect to the Common Securities and its consequences,
provided that, if the underlying Event of Default under the
Indenture:
(i) is not waivable under the Indenture, except
where the Holders of the Common Securities are deemed to
have waived such Event of Default under the Declaration as
provided below in this Section 2.6(b), the Event of Default
under the Declaration shall also not be waivable; or
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(ii) requires the consent or vote of a Super Majority
to be waived, except where the Holders of the Common
Securities are deemed to have waived such Event of Default
under the Declaration as provided below in this Section
2.6(b), the Event of Default under the Declaration may only
be waived by the vote of the Holders of at least the
proportion in aggregate liquidation amount of the Common
Securities that the relevant Super Majority represents of
the aggregate principal amount of the Debentures
outstanding;
provided further, each Holder of Common Securities will be deemed
to have waived any such Event of Default and all Events of
Default with respect to the Common Securities and its
consequences if all Events of Default with respect to the Capital
Securities have been cured, waived or otherwise eliminated, and
until such Events of Default have been so cured, waived or
otherwise eliminated, the Property Trustee will be deemed to be
acting solely on behalf of the Holders of the Capital Securities
and only the Holders of the Capital Securities will have the
right to direct the Property Trustee in accordance with the terms
of the Securities. The foregoing provisions of this Section
2.6(b) shall be in lieu of SECTIONS 316(a)(1)(A) and 316(a)(1)(B) of
the Trust Indenture Act and such SECTIONS 316(a)(1)(A) and 316(a)(1)(B)
of the Trust Indenture Act are hereby expressly excluded from
this Declaration and the Securities, as permitted by the Trust
Indenture Act. Subject to the foregoing provisions of this
Section 2.6(b), upon such waiver, any such default shall cease to
exist and any Event of Default with respect to the Common
Securities arising therefrom shall be deemed to have been cured
for every purpose of this Declaration, but no such waiver shall
extend to any subsequent or other default or Event of Default
with respect to the Common Securities or impair any right
consequent thereon.
(c) A waiver of an Event of Default under the
Indenture by the Property Trustee, at the direction of the
Holders of the Capital Securities, constitutes a waiver of the
corresponding Event of Default under this Declaration. The
foregoing provisions of this Section 2.6(c) shall be in lieu of
SECTION 316(a)(1)(B) of the Trust Indenture Act and such
SECTION 316(a)(1)(B) of the Trust Indenture Act is hereby expressly
excluded from this Declaration and the Securities, as permitted by
the Trust Indenture Act.
SECTION 2.7 Event of Default; Notice.
(a) The Property Trustee shall, within 90 days after
the occurrence of an Event of Default, transmit by mail, first
class postage prepaid, to the Holders of the Securities, notices
of all defaults with respect to the Securities actually known to
a Responsible Officer of the Property Trustee, unless such
defaults have been cured before the giving of such notice (the
term "defaults" for the purposes of this Section 2.7(a) being
hereby defined to be an Event of Default as defined in the Indenture
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not including any periods of grace provided for therein and irrespective of
the giving of any notice provided therein); provided that, except for a
default in the payment of principal of (or premium, if any) or interest on
any of the Debentures, the Property Trustee shall be protected in
withholding such notice if and so long as a Responsible Officer of the
Property Trustee in good faith determines that the withholding of such
notice is in the interests of the Holders of the Securities.
(b) The Property Trustee shall not be deemed to have
knowledge of any default except:
(i) a default under Sections 5.01(a) and 5.01(b) of
the Indenture; or
(ii) any default as to which the Property Trustee
shall have received written notice or of which a Responsible
Officer of the Property Trustee charged with the
administration of the Declaration shall have actual
knowledge.
(c) Within five Business Days after the occurrence
of any Event of Default actually known to a Responsible Officer
of the Property Trustee, the Property Trustee shall transmit
notice of such Event of Default to the holders of the Capital
Securities, the Administrative Trustees and the Sponsor, unless
such Event of Default shall have been cured or waived. The
Sponsor and the Administrative Trustees shall file annually with
the Property Trustee a certification as to whether or not they
are in compliance with all the conditions and covenants
applicable to them under this Declaration.
ARTICLE III
ORGANIZATION
SECTION 3.1 Name.
The Trust is named "BankBoston Capital Trust III" as
such name may be modified from time to time by the Administrative
Trustees following written notice to the Holders of Securities.
The Trust's activities may be conducted under the name of the
Trust or any other name deemed advisable by the Administrative
Trustees.
SECTION 3.2 Office.
The address of the principal office of the Trust is c/o
BankBoston Corporation, P.O. Box 2016, Boston, Massachusetts
02106-2016. On ten Business Days written notice to the Holders
of Securities, the Administrative Trustees may designate another
principal office.
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SECTION 3.3 Purpose.
The exclusive purposes and functions of the Trust are
(a) to issue and sell Securities, (b) use the proceeds from the
sale of the Securities to acquire the Debentures, and (c) except
as otherwise limited herein, to engage in only those other
activities necessary, advisable or incidental thereto. The Trust
shall not borrow money, issue debt or reinvest proceeds derived
from investments, mortgage or pledge any of its assets, or
otherwise undertake (or permit to be undertaken) any activity
that would cause the Trust not to be classified for United States
Federal income tax purposes as a grantor trust.
SECTION 3.4 Authority.
Subject to the limitations provided in this Declaration
and to the specific duties of the Property Trustee, the
Administrative Trustees shall have exclusive and complete
authority to carry out the purposes of the Trust. An action
taken by the Administrative Trustees in accordance with their
powers shall constitute the act of and serve to bind the Trust
and an action taken by the Property Trustee on behalf of the
Trust in accordance with its powers shall constitute the act of
and serve to bind the Trust. In dealing with the Trustees acting
on behalf of the Trust, no person shall be required to inquire
into the authority of the Trustees to bind the Trust. Persons
dealing with the Trust are entitled to rely conclusively on the
power and authority of the Trustees as set forth in this
Declaration.
SECTION 3.5 Title to Property of the Trust.
Except as provided in Section 3.8 with respect to the
Debentures and the Property Trustee Account or as otherwise
provided in this Declaration, legal title to all assets of the
Trust shall be vested in the Trust. The Holders shall not have
legal title to any part of the assets of the Trust, but shall
have an undivided beneficial interest in the assets of the Trust.
SECTION 3.6 Powers and Duties of the Administrative
Trustees.
The Administrative Trustees shall have the exclusive
power, duty and authority to cause the Trust to engage in the
following activities:
(a) to issue and sell the Capital Securities and the
Common Securities in accordance with this Declaration; provided,
however, that (i) the Trust may issue no more than one series of
Capital Securities and no more than one series of Common
Securities, (ii) there shall be no interests in the Trust other
than the Securities, and (iii) the issuance of Securities shall be
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limited to a simultaneous issuance of both Capital Securities
and Common Securities at any Closing Time,
(b) in connection with the issue and sale of the
Capital Securities, at the direction of the Sponsor, to:
(i) execute and file with the Commission the
registration statement on Form S-3 prepared by the Sponsor,
including any amendments thereto, pertaining to the Capital
Securities;
(ii) execute and file any documents prepared by the
Sponsor, or take any acts as determined by the Sponsor to be
necessary in order to qualify or register all or part of the
Capital Securities in any State in which the Sponsor has
determined to qualify or register such Capital Securities
for sale;
(iii) at the direction of the Sponsor, execute and
file an application, prepared by the Sponsor, to the New
York Stock Exchange or any other national stock exchange or
the Nasdaq Stock Market's National Market for listing or
quotation of the Capital Securities;
(iv) execute and deliver letters, documents, or
instruments with DTC and other Clearing Agencies relating to
the Capital Securities;
(v) if required, execute and file with the
Commission a registration statement on Form 8-A, including
any amendments thereto, prepared by the Sponsor, relating to
the registration of the Capital Securities under Section
12(b) or 12(g) of the Exchange Act;
(vi) execute and enter into the Purchase Agreement
providing for the sale of the Capital Securities; and
(vii) execute and file any agreement, certificate or
other document which such Administrative Trustee deems
necessary or appropriate in connection with the issuance and
sale of the Capital Securities;
(c) to acquire the Debentures with the proceeds of
the sale of the Capital Securities and the Common Securities;
provided, however, that the Administrative Trustees shall cause
legal title to the Debentures to be held of record in the name of
the Property Trustee for the benefit of the Holders of the
Capital Securities and the Holders of Common Securities;
(d) to cause the Trust to enter into such agreements
and arrangements as may be necessary or desirable in connection
with the sale of Capital Securities to the underwriters thereof
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and the consummation thereof, and to take all action, and
exercise all discretion, as may be necessary or desirable in
connection with the consummation thereof;
(e) to give the Sponsor and the Property Trustee
prompt written notice of the occurrence of a Special Event;
(f) to establish a record date with respect to all
actions to be taken hereunder that require a record date be
established, including and with respect to, for the purposes of
SECTION316(c) of the Trust Indenture Act, Distributions, voting rights,
redemptions and exchanges, and to issue relevant notices to the
Holders of Capital Securities and Holders of Common Securities as
to such actions and applicable record dates;
(g) to take all actions and perform such duties as
may be required of the Administrative Trustees pursuant to the
terms of the Securities;
(h) to bring or defend, pay, collect, compromise,
arbitrate, resort to legal action, or otherwise adjust claims or
demands of or against the Trust ("Legal Action"), unless pursuant
to Section 3.8(e), the Property Trustee has the exclusive power
to bring such Legal Action;
(i) to employ or otherwise engage employees and
agents (who may be designated as officers with titles) and
managers, contractors, advisors, and consultants and pay
reasonable compensation for such services;
(j) to cause the Trust to comply with the Trust's
obligations under the Trust Indenture Act;
(k) to give the certificate required by SECTION 314(a)(4)
of the Trust Indenture Act to the Property Trustee, which
certificate may be executed by any Administrative Trustee;
(l) to incur expenses that are necessary or
incidental to carry out any of the purposes of the Trust;
(m) to act as, or appoint another Person to act as,
Registrar for the Securities or to appoint a Paying Agent for the
Securities as provided in Section 7.4 except for such time as
such power to appoint a Paying Agent is vested in the Property
Trustee;
(n) to give prompt written notice to the Property
Trustee and to Holders of the Securities of any notice received
from the Debenture Issuer of its election to defer payments of
interest on the Debentures by extending the interest payment
period under the Indenture;
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(o) to execute all documents or instruments, perform
all duties and powers, and do all things for and on behalf of the
Trust in all matters necessary or incidental to the foregoing;
(p) to take all action that may be necessary or
appropriate for the preservation and the continuation of the
Trust's valid existence, rights, franchises and privileges as a
statutory business trust under the laws of the State of Delaware
and of each other jurisdiction in which such existence is
necessary to protect the limited liability of the Holders of the
Capital Securities or to enable the Trust to effect the purposes
for which the Trust was created;
(q) to take any action, not inconsistent with this
Declaration or with applicable law, that the Administrative
Trustees determine in their discretion to be necessary or
desirable in carrying out the activities of the Trust as set out
in this Section 3.6, including, but not limited to:
(i) causing the Trust not to be deemed to be an
Investment Company required to be registered under the
Investment Company Act;
(ii) causing the Trust to be classified for United
States Federal income tax purposes as a grantor trust; and
(iii) cooperating with the Debenture Issuer to ensure
that the Debentures will be treated as indebtedness of the
Debenture Issuer for United States Federal income tax
purposes; and
(r) to take all action necessary to cause all
applicable tax returns and tax information reports that are
required to be filed with respect to the Trust to be duly
prepared and filed by the Administrative Trustees, on behalf of
the Trust.
The Administrative Trustees must exercise the powers
set forth in this Section 3.6 in a manner that is consistent with
the purposes and functions of the Trust set out in Section 3.3,
and the Administrative Trustees shall not take any action that is
inconsistent with the purposes and functions of the Trust set
forth in Section 3.3.
Subject to this Section 3.6, the Administrative
Trustees shall have none of the powers or the authority of the
Property Trustee set forth in Section 3.8.
Any expenses incurred by the Administrative Trustees
pursuant to this Section 3.6 shall be reimbursed by the Debenture
Issuer.
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SECTION 3.7 Prohibition of Actions by the Trust and the
Trustees.
(a) The Trust shall not, and the Trustees (including
the Property Trustee) shall not, engage in any activity other
than as required or authorized by this Declaration. The Trust
shall not:
(i) invest any proceeds received by the Trust from
holding the Debentures, but shall distribute all such
proceeds to Holders of Securities pursuant to the terms of
this Declaration and of the Securities;
(ii) acquire any assets other than as expressly
provided herein;
(iii) possess Trust property for other than a Trust
purpose;
(iv) make any loans or incur any indebtedness other
than loans represented by the Debentures;
(v) possess any power or otherwise act in such a way
as to vary the Trust assets or the terms of the Securities
in any way whatsoever;
(vi) issue any securities or other evidences of
beneficial ownership of, or beneficial interest in, the
Trust other than the Securities; or
(vii) other than as provided in this Declaration or
Annex I, (A) direct the time, method and place of conducting
any proceeding with respect to any remedy available to the
Debenture Trustee, or exercising any trust or power
conferred upon the Debenture Trustee with respect to the
Debentures, (B) waive any past default that is waivable
under the Indenture, (C) exercise any right to rescind or
annul any declaration that the principal of all the
Debentures shall be due and payable, or (D) consent to any
amendment, modification or termination of the Indenture or
the Debentures where such consent shall be required unless
the Trust shall have received an opinion of a nationally
recognized independent tax counsel experienced in such
matters to the effect that such modification will not cause
more than an insubstantial risk that for United States
Federal income tax purposes the Trust will not be classified
as a grantor trust.
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SECTION 3.8 Powers and Duties of the Property Trustee.
(a) The legal title to the Debentures shall be owned
by and held of record in the name of the Property Trustee in
trust for the benefit of the Holders of the Securities. The
right, title and interest of the Property Trustee to the
Debentures shall vest automatically in each Person who may
hereafter be appointed as Property Trustee in accordance with
Section 5.7. Such vesting and cessation of title shall be
effective whether or not conveyancing documents with regard to
the Debentures have been executed and delivered.
(b) The Property Trustee shall not transfer its
right, title and interest in the Debentures to the Administrative
Trustees or to the Delaware Trustee (if the Property Trustee does
not also act as Delaware Trustee).
(c) The Property Trustee shall:
(i) establish and maintain a segregated non-interest
bearing trust account (the "Property Trustee Account") in
the name of and under the exclusive control of the Property
Trustee on behalf of the Holders of the Securities and, upon
the receipt of payments of funds made in respect of the
Debentures held by the Property Trustee, deposit such funds
into the Property Trustee Account and make payments to the
Holders of the Capital Securities and Holders of the Common
Securities from the Property Trustee Account in accordance
with Section 6.1. Funds in the Property Trustee Account
shall be held uninvested until disbursed in accordance with
this Declaration. The Property Trustee Account shall be an
account that is maintained with a banking institution the
rating on whose long-term unsecured indebtedness is at least
equal to the rating assigned to the Capital Securities by a
"nationally recognized statistical rating organization", as
that term is defined for purposes of Rule 436(g)(2) under
the Securities Act;
(ii) engage in such ministerial activities as shall
be necessary or appropriate to effect the redemption of the
Capital Securities and the Common Securities to the extent
the Debentures are redeemed or mature; and
(iii) upon written notice of distribution issued by
the Administrative Trustees in accordance with the terms of
the Securities, engage in such ministerial activities as
shall be necessary or appropriate to effect the distribution
of the Debentures to Holders of Securities upon the
occurrence of certain events.
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(d) The Property Trustee shall take all actions and
perform such duties as may be specifically required of the
Property Trustee pursuant to the terms of the Securities.
(e) Subject to Section 3.9(a), the Property Trustee
shall take any Legal Action which arises out of or in connection
with an Event of Default of which a Responsible Officer of the
Property Trustee has actual knowledge or the Property Trustee's
duties and obligations under this Declaration or the Trust
Indenture Act and if such Property Trustee shall have failed to
take such Legal Action, the Holders of the Capital Securities may
take such Legal Action, to the same extent as if such Holders of
Capital Securities held an aggregate principal amount of
Debentures equal to the aggregate liquidation amount of such
Capital Securities, without first proceeding against the Property
Trustee or the Trust; provided however, that if an Event of
Default has occurred and is continuing and such event is
attributable to the failure of the Debenture Issuer to pay the
principal of or premium, if any, or interest on the Debentures on
the date such principal, premium, if any, or interest is
otherwise payable (or in the case of redemption, on the
redemption date), then a Holder of Capital Securities may
directly institute a proceeding for enforcement of payment to
such Holder of the principal of or premium, if any, or interest
on the Debentures having a principal amount equal to the
aggregate liquidation amount of the Capital Securities of such
Holder (a "Direct Action") on or after the respective due date
specified in the Debentures. In connection with such Direct
Action, the rights of the Holders of the Common Securities will
be subrogated to the rights of such Holder of Capital Securities
to the extent of any payment made by the Debenture Issuer to such
Holder of Capital Securities in such Direct Action. Except as
provided in the preceding sentences, the Holders of Capital
Securities will not be able to exercise directly any other remedy
available to the holders of the Debentures.
(f) The Property Trustee shall not resign as a
Trustee unless either:
(i) the Trust has been completely liquidated and the
proceeds of the liquidation distributed to the Holders of
Securities pursuant to the terms of the Securities; or
(ii) a Successor Property Trustee has been appointed
and has accepted that appointment in accordance with Section
5.7.
(g) The Property Trustee shall have the legal power
to exercise all of the rights, powers and privileges of a holder
of Debentures under the Indenture and, if an Event of Default
actually known to a Responsible Officer of the Property Trustee
occurs and is continuing, the Property Trustee shall, for the
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benefit of Holders of the Securities, enforce its rights as
holder of the Debentures subject to the rights of the Holders
pursuant to the terms of such Securities.
(h) The Property Trustee shall be authorized to
undertake any actions set forth in SECTION 317(a) of the Trust
Indenture Act.
(i) For such time as the Property Trustee is the
Paying Agent, the Property Trustee may authorize one or more
Persons to act as additional Paying Agents and to pay
Distributions, redemption payments or liquidation payments on
behalf of the Trust with respect to all securities and any such
Paying Agent shall comply with SECTION 317(b) of the Trust Indenture
Act. Any such additional Paying Agent may be removed by the
Property Trustee at any time the Property Trustee remains as
Paying Agent and a successor Paying Agent or additional Paying
Agents may be (but are not required to be) appointed at any time
by the Property Trustee.
(j) Subject to this Section 3.8, the Property
Trustee shall have none of the duties, liabilities, powers or the
authority of the Administrative Trustees set forth in Section
3.6.
The Property Trustee must exercise the powers set forth
in this Section 3.8 in a manner that is consistent with the
purposes and functions of the Trust set out in Section 3.3, and
the Property Trustee shall not take any action that is
inconsistent with the purposes and functions of the Trust set out
in Section 3.3.
SECTION 3.9 Certain Duties and Responsibilities of the
Property Trustee.
(a) The Property Trustee, before the occurrence of
any Event of Default and after the curing of all Trust Events of
Default that may have occurred, shall undertake to perform only
such duties as are specifically set forth in this Declaration and
in the Securities and no implied covenants shall be read into
this Declaration against the Property Trustee. In case an Event
of Default has occurred (that has not been cured or waived
pursuant to Section 2.6) of which a Responsible Officer of the
Property Trustee has actual knowledge, the Property Trustee shall
exercise such of the rights and powers vested in it by this
Declaration, 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 or her own affairs.
(b) No provision of this Declaration shall be
construed to relieve the Property Trustee from liability for its own
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negligent action, its own negligent failure to act, or its
own willful misconduct, except that:
(i) prior to the occurrence of an 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 Property
Trustee shall be determined solely by the express
provisions of this Declaration and in the Securities
and the Property Trustee shall not be liable except for
the performance of such duties and obligations as are
specifically set forth in this Declaration and in the
Securities, and no implied covenants or obligations
shall be read into this Declaration against the
Property Trustee; and
(B) in the absence of bad faith on the part of
the Property Trustee, the Property 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
Property Trustee and conforming to the requirements of
this Declaration; provided, however, that in the case
of any such certificates or opinions that by any
provision hereof are specifically required to be
furnished to the Property Trustee, the Property Trustee
shall be under a duty to examine the same to determine
whether or not they conform to the requirements of this
Declaration;
(ii) the Property Trustee shall not be liable for any
error of judgment made in good faith by a Responsible
Officer of the Property Trustee, unless it shall be proved
that the Property Trustee was negligent in ascertaining the
pertinent facts;
(iii) 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
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 Declaration;
(iv) no provision of this Declaration shall require
the Property 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 it 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
Decla-
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ration or indemnity reasonably satisfactory to the
Property Trustee against such risk or liability is not
reasonably assured to it;
(v) the Property Trustee's sole duty with respect to
the custody, safe keeping and physical preservation of the
Debentures and the Property Trustee 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 Declaration and
the Trust Indenture Act;
(vi) the Property Trustee shall have no duty or
liability for or with respect to the value, genuineness,
existence or sufficiency of the Debentures or the payment of
any taxes or assessments levied thereon or in connection
therewith;
(vii) 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 Sponsor. Money held by
the Property Trustee need not be segregated from other funds
held by it except in relation to the Property Trustee
Account maintained by the Property Trustee pursuant to
Section 3.8(c)(i) and except to the extent otherwise
required by law; and
(viii) the Property Trustee shall not be responsible
for monitoring the compliance by the Administrative Trustees
or the Sponsor with their respective duties under this
Declaration, nor shall the Property Trustee be liable for
any default or misconduct of the Administrative Trustees or
the Sponsor.
SECTION 3.10 Certain Rights of Property Trustee.
(a) Subject to the provisions of Section 3.9:
(i) the Property Trustee may conclusively 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 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 Sponsor or the
Administrative Trustees contemplated by this Declaration may
be sufficiently evidenced by an Officers' Certificate;
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(iii) whenever in the administration of this
Declaration, the Property Trustee shall deem it desirable
that a matter be proved or established before taking,
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 conclusively rely upon an Officers' Certificate
which, upon receipt of such request, shall be promptly
delivered by the Sponsor or the Administrative Trustees;
(iv) 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 registration thereof;
(v) the Property Trustee may consult with counsel or
other experts of its selection and the advice or opinion of
such counsel and experts with respect to legal matters or
advice within the scope of such experts' area of expertise
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 accordance with such advice
or opinion, such counsel may be counsel to the Sponsor or
any of its Affiliates, and may include any of its employees.
The Property Trustee shall have the right at any time to
seek instructions concerning the administration of this
Declaration from any court of competent jurisdiction;
(vi) the Property Trustee shall be under no
obligation to exercise any of the rights or powers vested in
it by this Declaration at the request or direction of any
Holder, unless such Holder shall have provided to the
Property Trustee security and indemnity, reasonably
satisfactory to the Property Trustee, against the costs,
expenses (including reasonable attorneys' fees and expenses
and the expenses of the Property Trustee's agents, nominees
or custodians) 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 Property
Trustee provided, that, nothing contained in this Section
3.10(a)(vi) shall be taken to relieve the Property Trustee,
upon the occurrence of an Event of Default, of its
obligation to exercise the rights and powers vested in it by
this Declaration;
(vii) 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, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other
paper or document, but the Property Trustee, in its
discretion,
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may make such further inquiry or investigation into such
facts or matters as it may see fit;
(viii) the Property Trustee may execute any of the
trusts or powers hereunder or perform any duties hereunder
either directly or by or through agents, custodians,
nominees 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 it
hereunder;
(ix) any action taken by the Property Trustee or its
agents hereunder shall bind the Trust and the Holders of the
Securities, and the signature of the Property Trustee or its
agents alone shall be sufficient and effective to perform
any such action and no third party shall be required to
inquire as to the authority of the Property Trustee to so
act or as to its compliance with any of the terms and
provisions of this Declaration, both of which shall be
conclusively evidenced by the Property Trustee's or its
agent's taking such action;
(x) whenever in the administration of this
Declaration the Property Trustee shall deem it desirable to
receive instructions with respect to enforcing any remedy or
right or taking any other action hereunder, the Property
Trustee (i) may request instructions from the Holders of the
Securities which instructions may only be given by the
Holders of the same proportion in liquidation amount of the
Securities as would be entitled to direct the Property
Trustee under the terms of the 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
instructions are received, and (iii) shall be protected in
conclusively relying on or acting in or accordance with such
instructions;
(xi) except as otherwise expressly provided by this
Declaration, the Property Trustee shall not be under any
obligation to take any action that is discretionary under
the provisions of this Declaration; and
(xii) the Property Trustee shall not be liable for any
action taken, suffered, or omitted to be taken by it in good
faith, without negligence, and reasonably believed by it to
be authorized or within the discretion or rights or powers
conferred upon it by this Declaration.
(b) No provision of this Declaration 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
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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 3.11 Delaware Trustee.
Notwithstanding any other provision of this Declaration
other than Section 5.2, 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 Administrative
Trustees or the Property Trustee described in this Declaration.
Except as set forth in Section 5.2, the Delaware Trustee shall be
a Trustee for the sole and limited purpose of fulfilling the
requirements of SECTION3807 of the Business Trust Act.
SECTION 3.12 Execution of Documents.
Unless otherwise determined by the Administrative
Trustees, and except as otherwise required by the Business Trust
Act or provided herein, any Administrative Trustee is authorized
to execute on behalf of the Trust any documents that the
Administrative Trustees have the power and authority to execute
pursuant to this Declaration.
SECTION 3.13 Not Responsible for Recitals or Issuance of
Securities.
The recitals contained in this Declaration and the
Securities shall be taken as the statements of the Sponsor, and
the Trustees do not assume any responsibility for their
correctness. The Trustees make no representations as to the
value or condition of the property of the Trust or any part
thereof. The Trustees make no representations as to the validity
or sufficiency of this Declaration or the Securities.
SECTION 3.14 Duration of Trust.
The Trust, unless terminated pursuant to the provisions
of Article VIII hereof, shall have existence up to _______, 2028.
SECTION 3.15 Mergers.
(a) 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, except as described in Section 3.15(b) and (c).
(b) The Trust may, at the request of the Sponsor,
with the consent of the Administrative Trustees or, if there are
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more than two, a majority of the Administrative Trustees and
without the consent of the Holders of the Securities, the
Delaware Trustee or the Property Trustee, merge with or into,
consolidate, amalgamate, or be replaced by, or convey, transfer
or lease its properties and assets as an entirety or
substantially as an entirety to, a trust organized as such under
the laws of any State; provided that:
(i) such successor entity (the "Successor Entity")
either:
(A) expressly assumes all of the obligations of
the Trust under the Securities; or
(B) substitutes for the Securities other
securities having substantially the same terms as the
Securities (the "Successor Securities") so long as the
Successor Securities rank the same as the Securities
rank with respect to Distributions and payments upon
liquidation, redemption and otherwise;
(ii) the Sponsor expressly appoints a trustee of the
Successor Entity that possesses the same powers and duties
as the Property Trustee as the Holder of the Debentures;
(iii) the Successor Securities are listed, or any
Successor Securities will be listed upon notification of
issuance, on any national securities exchange or with
another organization on which the Capital Securities are
then listed or quoted;
(iv) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not cause
the Capital 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 Securities (including any Successor
Securities) in any material respect (other than with respect
to any dilution of such Holders' interests in the new
entity);
(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 Sponsor has received an opinion of an independent
counsel to the Trust experienced in such matters to the
effect that:
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(A) such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not
adversely affect the rights, preferences and privileges
of the Holders of the Securities (including any
Successor Securities) in any material respect (other
than with respect to any dilution of the Holders'
interest in the new entity); and
(B) following such merger, consolidation,
amalgamation, replacement, conveyance, transfer or
lease, neither the Trust nor the Successor Entity will
be required to register as an Investment Company; and
(viii) the Sponsor 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 Capital Securities Guarantee and the Common
Securities Guarantee.
(c) Notwithstanding Section 3.15(b), the Trust shall
not, except with the consent of Holders of 100% in liquidation
amount of the Securities, consolidate, amalgamate, merge with or
into, or be replaced by, or convey, transfer or lease its
properties and assets as an entirety or 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 not to be classified as a grantor trust for
United States Federal income tax purposes.
ARTICLE IV
SPONSOR
SECTION 4.1 Sponsor's Purchase of Common Securities.
At the Closing Time, the Sponsor will purchase all of
the Common Securities then issued by the Trust, in an amount at
least equal to 3% of the capital of the Trust, at the same time
as the Capital Securities are issued and sold.
SECTION 4.2 Responsibilities of the Sponsor.
In connection with the issue and sale of the Capital
Securities, the Sponsor shall have the exclusive right and
responsibility to engage in the following activities:
(a) to prepare for filing by the Trust with the
Commission a registration statement on Form S-3 in relation to
the Capital Securities, including any amendments thereto;
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(b) to determine the States in which to take
appropriate action to qualify or register for sale all or part of
the Capital Securities and to do any and all such acts, other
than actions which must be taken by the Trust, and advise the
Trust of actions it must take, and prepare for execution and
filing any documents to be executed and filed by the Trust, as
the Sponsor deems necessary or advisable in order to comply with
the applicable laws of any such States;
(c) if deemed necessary or advisable by the Sponsor,
to prepare for filing by the Trust an application to the New York
Stock Exchange or any other national stock exchange or the Nasdaq
National Market for listing or quotation of the Capital
Securities;
(d) to prepare for filing by the Trust with the
Commission a registration statement on Form 8-A relating to the
registration of the Capital Securities under Section 12(b) or
12(g) of the Exchange Act, including any amendments thereto; and
(e) to negotiate the terms of the Purchase Agreement
providing for the sale of the Capital Securities.
SECTION 4.3 Right to Proceed.
The Sponsor acknowledges the rights of the Holders of
Capital Securities, in the event that a failure of the Trust to
pay Distributions on the Capital Securities is attributable to
the failure of the Company to pay interest or principal on the
Debentures, to institute a proceeding directly against the
Debenture Issuer for enforcement of its payment obligations on
the Debentures.
ARTICLE V
TRUSTEES
SECTION 5.1 Number of Trustees: Appointment of Co-Trustee.
The number of Trustees initially shall be five (5),
and:
(a) at any time before the issuance of any
Securities, the Sponsor may, by written instrument, increase or
decrease the number of Trustees; and
(b) after the issuance of any Securities, the number
of Trustees may be increased or decreased by vote of the Holders
of a majority in liquidation amount of the Common Securities
voting as a class at a meeting of the Holders of the Common
Securities;
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provided, however, that, the number of Trustees shall in no event
be less than two (2); provided further that (1) one Trustee, in
the case of a natural person, shall be a person who is a resident
of the State of Delaware or that, if not a natural person, is an
entity which has its principal place of business in the State of
Delaware (the "Delaware Trustee"); (2) there shall be at least
one Trustee who is an employee or officer of, or is affiliated
with the Sponsor (an "Administrative Trustee"); and (3) one
Trustee shall be the Property Trustee for so long as this
Declaration is required to qualify as an indenture under the
Trust Indenture Act, and such Trustee may also serve as Delaware
Trustee if it meets the applicable requirements. Notwithstanding
the above, 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's property may at the
time be located, the Holders of a Majority in liquidation amount
of the Common Securities acting as a class at a meeting of the
Holders of the 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 the Trust's 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
this Declaration. In case an Event of Default has occurred and
is continuing, the Property Trustee alone shall have power to
make any such appointment of a co-trustee.
SECTION 5.2 Delaware Trustee.
If required by the Business Trust Act, one Trustee (the
"Delaware Trustee") shall be:
(a) a natural person who is a resident of the State
of Delaware; or
(b) 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 law,
provided that, if the Property Trustee has its principal place of
business in the State of Delaware and otherwise meets the
requirements of applicable law, then the Property Trustee shall
also be the Delaware Trustee and Section 3.11 shall have no
application.
SECTION 5.3 Property Trustee; Eligibility.
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(a) There shall at all times be one Trustee (the
"Property Trustee") which shall act as Property Trustee which
shall:
(i) not be an Affiliate of the Sponsor; and
(ii) be a corporation organized and doing business
under the laws of the United States of America or any State
or Territory thereof or of the District of Columbia, or a
corporation or Person permitted by the Commission to act as
an institutional trustee under the Trust Indenture Act,
authorized under such laws to exercise corporate trust
powers, having a combined capital and surplus of at least 50
million U.S. dollars ($50,000,000), and subject to
supervision or examination by Federal, State, Territorial or
District of Columbia authority. If such corporation
publishes reports of condition at least annually, pursuant
to law or to the requirements of the supervising or
examining authority referred to above, then for the purposes
of this Section 5.3(a)(ii), 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 Property Trustee shall cease
to be eligible to so act under Section 5.3(a), the Property
Trustee shall immediately resign in the manner and with the
effect set forth in Section 5.7(c).
(c) If the Property Trustee has or shall acquire any
"conflicting interest" within the meaning of SECTION 310(b) of the
Trust Indenture Act, the Property Trustee and the Holder of the
Common Securities (as if it were the obligor referred to in SECTION
310(b) of the Trust Indenture Act) shall in all respects comply
with the provisions of SECTION 310(b) of the Trust Indenture Act.
(d) The Capital Securities Guarantee shall be deemed
to be specifically described in this Declaration for purposes of
clause (i) of the first provision contained in Section 310(b) of
the Trust Indenture Act.
(e) The initial Property Trustee shall be:
The Bank of New York
101 Barclay Street
New York, New York 10286
Attention: Corporate Trust Trustee
Administration
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SECTION 5.4 Certain Qualifications of Administrative
Trustees and Delaware Trustee Generally.
Each Administrative Trustee and the Delaware Trustee
(unless the Property Trustee also acts as Delaware 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 Authorized
Officers.
SECTION 5.5 Administrative Trustees.
The initial Administrative Trustees shall be:
Robert T. Jefferson
Kathleen M. McGillycuddy
Craig V. Starble
(a) Except as expressly set forth in this
Declaration and except if a meeting of the Administrative
Trustees is called with respect to any matter over which the
Administrative Trustees have power to act, any power of the
Administrative Trustees may be exercised by, or with the consent
of, any one such Administrative Trustee.
(b) Unless otherwise determined by the
Administrative Trustees, and except as otherwise required by the
Business Trust Act or applicable law, any Administrative Trustee
is authorized to execute on behalf of the Trust any documents
which the Administrative Trustees have the power and authority to
cause the Trust to execute pursuant to Section 3.6; and
(c) An 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
purposes of signing any documents which the Administrative
Trustees have power and authority to cause the Trust to execute
pursuant to Section 3.6.
SECTION 5.6 Delaware Trustee.
The initial Delaware Trustee shall be:
The Bank of New York (Delaware)
23 White Clay Center
Route 273
Newark, Delaware 19711
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SECTION 5.7 Appointment, Removal and Resignation of
Trustees.
(a) Subject to Section 5.7(b), Trustees may be
appointed or removed without cause at any time:
(i) until the issuance of any Securities, by written
instrument executed by the Sponsor;
(ii) unless an Event of Default shall have occurred
and be continuing after the issuance of any Securities, by
vote of the Holders of a Majority in liquidation amount of
the Common Securities voting as a class at a meeting of the
Holders of the Common Securities; and
(iii) if an Event of Default shall have occurred and
be continuing after the issuance of the Securities, with
respect to the Property Trustee or the Delaware Trustee, by
vote of Holders of a Majority in liquidation amount of the
Capital Securities voting as a class at a meeting of Holders
of the Capital Securities.
(b) (i) The Trustee that acts as Property Trustee
shall not be removed in accordance with Section 5.7(a) until a
Successor Property Trustee has been appointed and has accepted
such appointment by written instrument executed by such Successor
Property Trustee and delivered to the Administrative Trustees and
the Sponsor; and
(ii) the Trustee that acts as Delaware Trustee shall
not be removed in accordance with this Section 5.7(a) until
a successor Trustee possessing the qualifications to act as
Delaware Trustee under Sections 5.2 and 5.4 (a "Successor
Delaware Trustee") has been appointed and has accepted such
appointment by written instrument executed by such Successor
Delaware Trustee and delivered to the Administrative
Trustees and the Sponsor.
(c) A Trustee appointed to office shall hold office
until his successor shall have been appointed or until his death,
removal or resignation. Any Trustee may resign from office
(without need for prior or subsequent accounting) by an
instrument in writing signed by the Trustee and delivered to the
Sponsor and the Trust, which resignation shall take effect upon
such delivery or upon such later date as is specified therein;
provided, however, that:
(i) No such resignation of the Trustee that acts as
the Property Trustee shall be effective:
(A) until a Successor Property Trustee has been
appointed and has accepted such appointment by instru-
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ument executed by such Successor Property Trustee
and delivered to the Trust, the Sponsor and the
resigning Property Trustee; or
(B) until the assets of the Trust have been
completely liquidated and the proceeds thereof
distributed to the holders of the Securities; and
(ii) no such resignation of the Trustee that acts as
the Delaware Trustee shall be effective until a Successor
Delaware Trustee has been appointed and has accepted such
appointment by instrument executed by such Successor
Delaware Trustee and delivered to the Trust, the Sponsor and
the resigning Delaware Trustee.
(d) The Holders of the Common Securities shall use
their best efforts to promptly appoint a Successor Delaware
Trustee or Successor Property Trustee, as the case may be, if the
Property Trustee or the Delaware Trustee delivers an instrument
of resignation in accordance with this Section 5.7.
(e) If no Successor Property Trustee or Successor
Delaware Trustee shall have been appointed and accepted
appointment as provided in this Section 5.7 within 60 days after
delivery of an instrument of resignation or removal, the Property
Trustee or Delaware Trustee resigning or being removed, as
applicable, may petition any court of competent jurisdiction for
appointment of a Successor Property Trustee or Successor Delaware
Trustee. Such court may thereupon, after prescribing such
notice, if any, as it may deem proper and prescribe, appoint a
Successor Property Trustee or Successor Delaware Trustee, as the
case may be.
(f) No Property Trustee or Delaware Trustee shall be
liable for the acts or omissions to act of any Successor Property
Trustee or Successor Delaware Trustee, as the case may be.
SECTION 5.8 Vacancies among Trustees.
If a Trustee ceases to hold office for any reason and
the number of Trustees is not reduced pursuant to Section 5.1, or
if the number of Trustees is increased pursuant to Section 5.1, a
vacancy shall occur. A resolution certifying the existence of
such vacancy by the Administrative Trustees or, if there are more
than two, a majority of the Administrative Trustees shall be
conclusive evidence of the existence of such vacancy. The
vacancy shall be filled with a Trustee appointed in accordance
with Section 5.7.
SECTION 5.9 Effect of Vacancies.
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The death, resignation, retirement, removal,
bankruptcy, dissolution, liquidation, 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 5.7, the Administrative Trustees in office, regardless of
their number, shall have all the powers granted to the
Administrative Trustees and shall discharge all the duties
imposed upon the Administrative Trustees by this Declaration.
SECTION 5.10 Meetings.
If there is more than one Administrative Trustee,
meetings of the Administrative Trustees shall be held from time
to time upon the call of any Administrative Trustee. Regular
meetings of the Administrative Trustees may be held at a time and
place fixed by resolution of the Administrative Trustees. Notice
of any in-person meetings of the Administrative Trustees shall be
hand delivered or otherwise delivered in writing (including by
facsimile, with a hard copy by overnight courier) not less than
24 hours before such meeting. Notice of any telephonic meetings
of the Administrative Trustees or any committee thereof shall be
hand delivered or otherwise delivered in writing (including by
facsimile, with a hard copy by overnight courier) not less than
24 hours before a meeting. Notices shall contain a brief
statement of the time, place and anticipated purposes of the
meeting. The presence (whether in person or by telephone) of an
Administrative Trustee at a meeting shall constitute a waiver of
notice of such meeting except where an Administrative Trustee
attends a meeting for the express purpose of objecting to the
transaction of any activity on the ground that the meeting has
not been lawfully called or convened. Unless provided otherwise
in this Declaration, any action of the Administrative Trustees
may be taken at a meeting by vote of a majority of the
Administrative Trustees present (whether in person or by
telephone) and eligible to vote with respect to such matter,
provided that a Quorum is present, or without a meeting by the
unanimous written consent of the Administrative Trustees. In the
event there is only one Administrative Trustee, any and all
action of such Administrative Trustee shall be evidenced by a
written consent of such Administrative Trustee.
SECTION 5.11 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 executing any documents contemplated in Section 3.6,
including any registration statement or amendment thereto filed
with the Commission, or making any other governmental filing; and
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(b) the Administrative Trustees shall have power to
delegate from time to time to such of their number or to officers
of the Trust 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 the
Trust, as set forth herein.
Section 5.12 Merger, Conversion, Consolidation or Succession
to Business.
Any corporation into which the Property Trustee or the
Delaware Trustee or any Administrative Trustee that is not a
natural person, as the case may be, 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
Property Trustee or the Delaware Trustee, as the case may be,
shall be a party, or any corporation succeeding to all or
substantially all the corporate trust business of the Property
Trustee or the Delaware Trustee, as the case may be, shall be the
successor of the Property Trustee or the Delaware Trustee, as the
case may be, hereunder, provided such corporation 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.
ARTICLE VI
DISTRIBUTIONS
SECTION 6.1 Distributions.
Holders shall receive Distributions in accordance with
the applicable terms of the relevant Holder's Securities. If and
to the extent that the Debenture Issuer makes a payment of
interest (including Compounded Interest (as defined in the
Indenture) and Additional Interest (as defined in the
Indenture)), premium and/or principal on the Debentures held by
the Property Trustee (the amount of any such payment being a
"Payment Amount"), the Property Trustee shall and is directed, to
the extent funds are available for that purpose, to make a
distribution (a "Distribution") of the Payment Amount to Holders.
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ARTICLE VII
ISSUANCE OF SECURITIES
SECTION 7.1 General Provisions Regarding Securities.
(a) The Administrative Trustees shall on behalf of
the Trust issue one class of capital securities representing
undivided beneficial interests in the assets of the Trust having
such terms as are set forth in Annex I (the "Capital Securities")
and one class of common securities representing undivided
beneficial interests in the assets of the Trust having such terms
as are set forth in Annex I (the "Common Securities"). The Trust
shall issue no securities or other interests in the assets of the
Trust other than the Capital Securities and the Common
Securities.
(b) The consideration received by the Trust for the
issuance of the Securities shall constitute a contribution to the
capital of the Trust and shall not constitute a loan to the
Trust.
(c) Upon issuance of the Securities as provided in
this Declaration, the Securities so issued shall be deemed to be
validly issued, fully paid and non-assessable.
(d) Every Person, by virtue of having become a
Holder or a Capital Security Beneficial Owner in accordance with
the terms of this Declaration, shall be deemed to have expressly
assented and agreed to the terms of, and shall be bound by, this
Declaration.
SECTION 7.2 Execution and Authentication.
(a) The Securities shall be signed on behalf of the
Trust by an Administrative Trustee. In case any Administrative
Trustee of the Trust who shall have signed any of the Securities
shall cease to be such Administrative Trustee before the
Securities so signed shall be delivered by the Trust, such
Securities nevertheless may be delivered as though the person who
signed such Securities had not ceased to be such Administrative
Trustee; and any Securities may be signed on behalf of the Trust
by such persons who, at the actual date of execution of such
Security, shall be the Administrative Trustees of the Trust,
although at the date of the execution and delivery of the
Declaration any such person was not such a Administrative
Trustee.
(b) One Administrative Trustee shall sign the
Capital Securities for the Trust by manual or facsimile
signature. Unless otherwise determined by the Trust, such
signature shall, in the case of Common Securities, be a manual
signature.
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A Capital Security shall not be valid until
authenticated by the manual signature of an authorized signatory
of the Property Trustee. The signature shall be conclusive
evidence that the Capital Security has been authenticated under
this Declaration.
Upon a written order of the Trust signed by one
Administrative Trustee, the Property Trustee shall authenticate
the Capital Securities for original issue. The aggregate number
of Capital Securities outstanding at any time shall not exceed
the number set forth in the Terms in Annex I hereto except as
provided in Section 7.6.
The Property Trustee may appoint an authenticating
agent acceptable to the Trust to authenticate Capital Securities.
An authenticating agent may authenticate Capital Securities
whenever the Property Trustee may do so. Each reference in this
Declaration to authentication by the Property Trustee includes
authentication by such agent. An authenticating agent has the
same rights as the Property Trustee to deal with the Sponsor or
an Affiliate.
SECTION 7.3 Form and Dating.
The Capital Securities and the Property Trustee's
certificate of authentication shall be substantially in the form
of Exhibit A-1 and the Common Securities shall be substantially
in the form of Exhibit A-2, each of which is hereby incorporated
in and expressly made a part of this Declaration. Certificates
representing the Securities may be printed, lithographed or
engraved or may be produced in any other manner as is reasonably
acceptable to the Administrative Trustees, as evidenced by their
execution thereof. The Securities may have letters, CUSIP or
other numbers, notations or other marks of identification or
designation and such legends or endorsements required by law,
stock exchange rule, agreements to which the Trust is subject, if
any, or usage (provided that any such notation, legend or
endorsement is in a form acceptable to the Trust). The Trust at
the direction of the Sponsor shall furnish any such legend not
contained in Exhibit A-1 to the Property Trustee in writing.
Each Capital Security shall be dated the date of its
authentication. The terms and provisions of the Securities set
forth in Annex I and the forms of Securities set forth in
Exhibits A-1 and A-2 are part of the terms of this Declaration
and to the extent applicable, the Property Trustee and the
Sponsor, by their execution and delivery of this Declaration,
expressly agree to such terms and provisions and to be bound
thereby.
(a) Global Securities. The Capital Securities shall
be issued in the form of one or more permanent global Securities
in definitive, fully registered form without Distribution coupons
with the appropriate global legends set forth in Exhibit A-1
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hereto (a "Global Capital Security"), which shall be deposited on
behalf of the purchasers of the Capital Securities represented
thereby with the Property Trustee, at its New York office, as
custodian for the Clearing Agency, and registered in the name of
the Clearing Agency or a nominee of the Clearing Agency, duly
executed by the Trust and authenticated by the Property Trustee
as hereinafter provided. The number of Capital Securities
represented by the Global Capital Security may from time to time
be increased or decreased by adjustments made on the records of
the Property Trustee and the Clearing Agency or its nominee as
hereinafter provided.
(b) Book-Entry Provisions. This Section 7.3(b)
shall apply only to the Global Capital Securities and such other
Capital Securities in global form as may be authorized by the
Trust to be deposited with or on behalf of the Clearing Agency.
The Trust shall execute and the Property Trustee shall,
in accordance with this Section 7.3, authenticate and make
available for delivery initially one or more Global Capital
Securities that (i) shall be registered in the name of Cede & Co.
or other nominee of such Clearing Agency and (ii) shall be
delivered by the Trustee to such Clearing Agency or pursuant to
such Clearing Agency's written instructions or held by the
Property Trustee as custodian for the Clearing Agency.
Members of, or participants in, the Clearing Agency
("Participants") shall have no rights under this Declaration with
respect to any Global Capital Security held on their behalf by
the Clearing Agency or by the Property Trustee as the custodian
of the Clearing Agency or under such Global Capital Security, and
the Clearing Agency may be treated by the Trust, the Property
Trustee and any agent of the Trust or the Property Trustee as the
absolute owner of such Global Capital Security for all purposes
whatsoever. Notwithstanding the foregoing, nothing herein shall
prevent the Trust, the Property Trustee or any agent of the Trust
or the Property Trustee from giving effect to any written
certification, proxy or other authorization furnished by the
Clearing Agency or impair, as between the Clearing Agency and its
Participants, the operation of customary practices of such
Clearing Agency governing the exercise of the rights of a holder
of a beneficial interest in any Global Capital Security.
(c) Definitive Capital Securities. Except as
provided in Section 7.9, owners of beneficial interests in a
Global Capital Security will not be entitled to receive physical
delivery of certificated Capital Securities ("Definitive Capital
Securities").
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SECTION 7.4 Registrar and Paying Agent.
The Trust shall maintain in the Borough of Manhattan,
The City of New York, (i) an office or agency where Capital
Securities may be presented for registration of transfer
("Registrar") and (ii) an office or agency where Capital
Securities may be presented for payment ("Paying Agent"). The
Registrar shall keep a register of the Capital Securities and of
their transfer. The Trust may appoint the Registrar and the
Paying Agent and may appoint one or more co-registrars and one or
more additional paying agents in such other locations as it shall
determine. The term "Registrar" includes any additional
registrar and the term "Paying Agent" includes any additional
paying agent. The Trust may change any Paying Agent, Registrar
or co-registrar without prior notice to any Holder. The Paying
Agent shall be permitted to resign as Paying Agent upon 30 days'
written notice to the Administrative Trustees. The Trust shall
notify the Property Trustee of the name and address of any Agent
not a party to this Declaration. If the Trust fails to appoint
or maintain another entity as Registrar or Paying Agent, the
Property Trustee shall act as such. The Trust or any of its
Affiliates may act as Paying Agent or Registrar. The Trust shall
act as Paying Agent, Registrar and co-registrar for the Common
Securities.
The Trust initially appoints the Property Trustee as
Registrar and Paying Agent for the Capital Securities.
SECTION 7.5 Paying Agent to Hold Money in Trust.
The Trust shall require each Paying Agent other than
the Property Trustee to agree in writing that the Paying Agent
will hold in trust for the benefit of Holders or the Property
Trustee all money held by the Paying Agent for the payment of
liquidation amounts or Distributions on the Securities, and will
notify the Property Trustee if there are insufficient funds for
such purpose. While any such insufficiency continues, the
Property Trustee may require a Paying Agent to pay all money held
by it to the Property Trustee. The Trust at any time may require
a Paying Agent to pay all money held by it to the Property
Trustee and to account for any money disbursed by it. Upon
payment over to the Property Trustee, the Paying Agent (if other
than the Trust or an Affiliate of the Trust) shall have no
further liability for the money. If the Trust or the Sponsor or
an Affiliate of the Trust or the Sponsor acts as Paying Agent, it
shall segregate and hold in a separate trust fund for the benefit
of the Holders all money held by it as Paying Agent.
SECTION 7.6 Replacement Securities.
If the holder of a Security claims that the Security
has been lost, destroyed or wrongfully taken or if such Security
is mutilated and is surrendered to the Trust or in the case of
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the Capital Securities to the Property Trustee, the Trust shall
issue and the Property Trustee shall authenticate a replacement
Security if the Property Trustee's and the Trust's requirements,
as the case may be, are met. An indemnity bond must be provided
by the Holder which, in the judgment of the Property Trustee, is
sufficient to protect the Trustees, the Sponsor or any
authenticating agent from any loss which any of them may suffer
if a Security is replaced. The Trust may charge such holder for
its expenses in replacing a Security.
Every replacement Security is an additional beneficial
interest in the Trust.
SECTION 7.7 Outstanding Capital Securities.
The Capital Securities outstanding at any time are all
the Capital Securities authenticated by the Property Trustee
except for those cancelled by it, those delivered to it for
cancellation, and those described in this Section as not
outstanding.
If a Capital Security is replaced, paid or purchased
pursuant to Section 7.6 hereof, it ceases to be outstanding
unless the Property Trustee receives proof satisfactory to it
that the replaced, paid or purchased Capital Security is held by
a bona fide purchaser.
If Capital Securities are considered paid in accordance
with the terms of this Declaration, they cease to be outstanding
and Distributions on them shall cease to accumulate.
A Capital Security does not cease to be outstanding
because one of the Trust, the Sponsor or an Affiliate of the
Sponsor holds the Security.
SECTION 7.8 Capital Securities in Treasury.
In determining whether the Holders of the required
amount of Securities have concurred in any direction, waiver or
consent, Capital Securities owned by the Trust, the Sponsor or an
Affiliate of the Sponsor, as the case may be, shall be
disregarded and deemed not to be outstanding, except that for the
purposes of determining whether the Property Trustee shall be
fully protected in relying on any such direction, waiver or
consent, only Securities which a Responsible Officer of the
Property Trustee actually knows are so owned shall be so
disregarded.
SECTION 7.9 Temporary Securities.
(a) Until Definitive Securities are ready for
delivery, the Trust may prepare and, in the case of the Capital
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Securities, the Property Trustee shall authenticate temporary
Securities. Temporary Securities shall be substantially in the
form of Definitive Securities but may have variations that the
Trust considers appropriate for temporary Securities. Without
unreasonable delay, the Trust shall prepare and, in the case of
the Capital Securities, the Property Trustee shall authenticate
Definitive Securities in exchange for temporary Securities.
(b) A Global Capital Security deposited with the
Clearing Agency or with the Property Trustee as custodian for the
Clearing Agency pursuant to Section 7.3 shall be transferred to
the beneficial owners thereof in the form of certificated Capital
Securities only if such transfer complies with Section 9.2 and
(i) the Clearing Agency notifies the Company that it is unwilling
or unable to continue as Clearing Agency for such Global Capital
Security or if at any time such Clearing Agency ceases to be a
"clearing agency" registered under the Exchange Act and a
clearing agency is not appointed by the Sponsor within 90 days of
such notice, (ii) a Default or an Event of Default has occurred
and is continuing or (iii) the Trust at its sole discretion
elects to cause the issuance of certificated Capital Securities.
(c) Any Global Capital Security that is transferable
to the beneficial owners thereof in the form of certificated
Capital Securities pursuant to this Section 7.9 shall be
surrendered by the Clearing Agency to the Property Trustee
located in the Borough of Manhattan, The City of New York, to be
so transferred, in whole or from time to time in part, without
charge, and the Property Trustee shall authenticate and make
available for delivery, upon such transfer of each portion of
such Global Capital Security, an equal aggregate liquidation
amount of Securities of authorized denominations in the form of
certificated Capital Securities. Any portion of a Global Capital
Security transferred pursuant to this Section shall be registered
in such names as the Clearing Agency shall direct.
(d) Subject to the provisions of Section 7.9(c), the
Holder of a Global Capital Security may grant proxies and
otherwise authorize any person, including Participants and
persons that may hold interests through Participants, to take any
action which such Holder is entitled to take under this
Declaration or the Securities.
(e) In the event of the occurrence of any of the
events specified in Section 7.9(b), the Trust will promptly make
available to the Property Trustee a reasonable supply of
certificated Capital Securities in fully registered form without
distribution coupons.
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SECTION 7.10 Cancellation.
The Trust at any time may deliver Capital Securities to
the Property Trustee for cancellation. The Registrar and Paying
Agent shall forward to the Property Trustee any Capital
Securities surrendered to them for registration of transfer,
redemption, exchange or payment. The Property Trustee shall
promptly cancel all Capital Securities, surrendered for
registration of transfer, redemption, exchange, payment,
replacement or cancellation and shall dispose of cancelled
Capital Securities as the Trust directs, provided that the
Property Trustee shall not be obligated to destroy Capital
Securities. The Trust may not issue new Capital Securities to
replace Capital Securities that it has paid or that have been
delivered to the Property Trustee for cancellation.
SECTION 7.11 CUSIP Numbers.
The Trust in issuing the Capital Securities may use
"CUSIP" numbers (if then generally in use), and, if so, the
Property Trustee shall use "CUSIP" numbers in notices of
redemption as a convenience to Holders of Capital Securities;
provided that any such notice may state that no representation is
made as to the correctness of such numbers either as printed on
the Capital Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other
identification numbers printed on the Capital Securities, and any
such redemption shall not be affected by any defect in or
omission of such numbers. The Sponsor will promptly notify the
Property Trustee of any change in the CUSIP numbers.
ARTICLE VIII
TERMINATION OF TRUST
SECTION 8.1 Termination of Trust.
(a) The Trust shall automatically terminate:
(i) upon the bankruptcy of the Sponsor;
(ii) upon the filing of a certificate of dissolution
or liquidation or its equivalent with respect to the
Sponsor; or the revocation of the Sponsor's charter and the
expiration of 90 days after the date of revocation without a
reinstatement thereof;
(iii) following the distribution of a Like Amount of
the Debentures to the Holders of the Securities, provided
that, the Property Trustee has received written notice from
the Sponsor directing the Property Trustee to terminate the
Trust (which direction is optional, and except as otherwise
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expressly provided below, within the discretion of the
Sponsor) and provided, further, that such direction and such
distribution is conditioned on (i) the prior approval of the
Federal Reserve Board if such approval is then required
under applicable capital guidelines or policies of the
Federal Reserve Board, (ii) the Administrative Trustees'
receipt of an opinion of an independent tax counsel
experienced in such matters (a "No Recognition Opinion"),
which opinion may rely on published rulings of the Internal
Revenue Service, to the effect that the Holders of the
Securities will not recognize any gain or loss for United
States Federal income tax purposes as a result of the
dissolution of the Trust and the distribution of Debentures;
(iv) upon the entry of a decree of judicial
dissolution of the Trust by a court of competent
jurisdiction;
(v) when all of the Securities shall have been
called for redemption and the amounts necessary for
redemption thereof shall have been paid to the Holders in
accordance with the terms of the Securities;
(vi) upon the repayment of the Debentures or at such
time as no Debentures are outstanding; or
(vii) the expiration of the term of the Trust provided
in Section 3.14.
(b) As soon as is practicable after the occurrence
of an event referred to in Section 8.1(a), the Administrative
Trustees shall file a certificate of cancellation with the
Secretary of State of the State of Delaware.
(c) The provisions of Section 3.9 and Article X
shall survive the termination of the Trust.
ARTICLE IX
TRANSFER OF INTERESTS
SECTION 9.1 Transfer of Securities.
(a) Securities may only be transferred, in whole or
in part, in accordance with the terms and conditions set forth in
this Declaration and in the terms of the Securities. Any
transfer or purported transfer of any Security not made in
accordance with this Declaration shall be null and void.
(b) Subject to this Article IX, Capital Securities
shall be freely transferable.
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(c) The Sponsor may not transfer the Common
Securities.
(d) The Administrative Trustees shall provide for
the registration of Securities and of the transfer of Securities,
which will be effected without charge but only upon payment (with
such indemnity as the Administrative Trustees may require) in
respect of any tax or other governmental charges that may be
imposed in relation to it. Upon surrender for registration of
transfer of any Securities, the Administrative Trustees shall
cause one or more new Securities to be issued in the name of the
designated transferee or transferees. Every Security surrendered
for registration of transfer shall be accompanied by a written
instrument of transfer in form satisfactory to the Administrative
Trustees duly executed by the Holder or such Holder's attorney
duly authorized in writing. Each Security surrendered for
registration of transfer shall be canceled by the Administrative
Trustees. A transferee of a Security shall be entitled to the
rights and subject to the obligations of a Holder hereunder upon
the receipt by such transferee of a Security. By acceptance of a
Security, each transferee shall be deemed to have agreed to be
bound by this Declaration.
SECTION 9.2 Transfer Procedures and Restrictions
(a) Transfer and Exchange of Definitive Capital
Securities. When Definitive Capital Securities are presented to
the Registrar or co-Registrar
(x) to register the transfer of such Definitive
Capital Securities; or
(y) to exchange such Definitive Capital Securities
which became mutilated, destroyed, defaced, stolen or lost,
for an equal number of Definitive Capital Securities,
the Registrar or co-registrar shall register the transfer or make
the exchange as requested if its reasonable requirements for such
transaction are met; provided, however, that the Definitive
Capital Securities surrendered for transfer or exchange shall be
duly endorsed or accompanied by a written instrument of transfer
in form reasonably satisfactory to the Trust and the Registrar or
co-registrar, duly executed by the Holder thereof or his attorney
duly authorized in writing.
(b) Transfer of a Definitive Capital Security for a
Beneficial Interest in a Global Capital Security. Upon receipt
by the Property Trustee of a Definitive Capital Security, duly
endorsed or accompanied by appropriate instruments of transfer,
in form satisfactory to the Property Trustee, together with
written instructions directing the Property Trustee to make, or
to direct the Clearing Agency to make, an adjustment on its books
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and records with respect to the Global Capital Security to
reflect an increase in the number of the Capital Securities
represented by such Global Capital Security, then the Property
Trustee shall cancel such Definitive Capital Security and cause,
or direct the Clearing Agency to cause, the aggregate number of
Capital Securities represented by the appropriate Global Capital
Security to be increased accordingly. If no Global Capital
Securities are then outstanding, the Trust shall issue and the
Property Trustee shall authenticate, upon written order of any
Administrative Trustee, an appropriate number of Capital
Securities in global form.
(c) Transfer and Exchange of Global Capital
Securities. Subject to Section 9.02(d), the transfer and
exchange of Global Capital Securities or beneficial interests
therein shall be effected through the Clearing Agency, in
accordance with this Declaration (including applicable
restrictions on transfer set forth herein, if any) and the
procedures of the Clearing Agency therefor.
(d) Transfer of a Beneficial Interest in a Global
Capital Security for a Definitive Capital Security.
(i) Any person having a beneficial interest in a
Global Capital Security may upon request, but only upon 20
days prior notice to the Property Trustee, and if
accompanied by the information specified below, exchange
such beneficial interest for a Definitive Capital Security
representing the same number of Capital Securities. Upon
receipt by the Property Trustee from the Clearing Agency or
its nominee on behalf of any Person having a beneficial
interest in a Global Capital Security of written
instructions or such other form of instructions as is
customary for the Clearing Agency or the person designated
by the Clearing Agency as having such a beneficial interest
in a Global Capital Security, then the Property Trustee will
cause the aggregate number of Capital Securities represented
by Global Capital Securities to be reduced on its books and
records and, following such reduction, the Trust will
execute and the Property Trustee will authenticate and make
available for delivery to the transferee a Definitive
Capital Security.
(ii) Definitive Capital Securities issued in exchange
for a beneficial interest in a Global Capital Security
pursuant to this Section 9.2(d) shall be registered in such
names and in such authorized denominations as the Clearing
Agency, pursuant to instructions from its Participants or
indirect participants or otherwise, shall instruct the
Property Trustee in writing. The Property Trustee shall
deliver such Capital Securities to the persons in whose
names such Capital Securities are so registered in
accordance with such instructions of the Clearing Agency.
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(e) Restrictions on Transfer and Exchange of Global
Capital Securities. Notwithstanding any other provisions of this
Declaration (other than the provisions set forth in subsection
(f) of this Section 9.2), a Global Capital Security may not be
transferred as a whole except by the Clearing Agency to a nominee
of the Clearing Agency or another nominee of the Clearing Agency
or by the Clearing Agency or any such nominee to a successor
Clearing Agency or a nominee of such successor Clearing Agency.
(f) Authentication of Definitive Capital Securities.
If at any time:
(i) there occurs a Default or an Event of Default
which is continuing, or
(ii) the Trust, in its sole discretion, notifies the
Property Trustee in writing that it elects to cause the
issuance of Definitive Capital Securities under this
Declaration,
then the Trust will execute, and the Property Trustee, upon
receipt of a written order of the Trust signed by one
Administrative Trustee requesting the authentication and delivery
of Definitive Capital Securities to the Persons designated by the
Trust, will authenticate and make available for delivery
Definitive Capital Securities, equal in number to the number of
Capital Securities represented by the Global Capital Securities,
in exchange for such Global Capital Securities.
(g) Cancellation or Adjustment of Global Capital
Security. At such time as all beneficial interests in a Global
Capital Security have either been exchanged for Definitive
Capital Securities to the extent permitted by this Declaration or
redeemed, repurchased or canceled in accordance with the terms of
this Declaration, such Global Capital Security shall be returned
to the Clearing Agency for cancellation or retained and canceled
by the Property Trustee. At any time prior to such cancellation,
if any beneficial interest in a Global Capital Security is
exchanged for Definitive Capital Securities, Capital Securities
represented by such Global Capital Security shall be reduced and
an adjustment shall be made on the books and records of the
Property Trustee (if it is then the custodian for such Global
Capital Security) with respect to such Global Capital Security,
by the Property Trustee or the Securities Custodian, to reflect
such reduction.
(h) Obligations with Respect to Transfers and
Exchanges of Capital Securities.
(i) To permit registrations of transfers and
exchanges, the Trust shall execute and the Property Trustee
shall authenticate Definitive Capital Securities and Global
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Capital Securities at the Registrar's or co-Registrar's
request in accordance with the terms of this Declaration.
(ii) Registrations of transfers or exchanges will be
effected without charge, but only upon payment (with such
indemnity as the Trust or the Sponsor may require) in
respect of any tax or other governmental charge that may be
imposed in relation to it.
(iii) The Registrar or co-registrar shall not be
required to register the transfer of or exchange of (a)
Capital Securities during a period beginning at the opening
of business 15 days before the day of mailing of a notice of
redemption or any notice of selection of Capital Securities
for redemption and ending at the close of business on the
day of such mailing; or (b) any Capital Security so selected
for redemption in whole or in part, except the unredeemed
portion of any Capital Security being redeemed in part.
(iv) Prior to the due presentation for registrations
of transfer of any Capital Security, the Trust, the Property
Trustee, the Paying Agent, the Registrar or any co-registrar
may deem and treat the person in whose name a Capital
Security is registered as the absolute owner of such Capital
Security for the purpose of receiving Distributions on such
Capital Security and for all other purposes whatsoever, and
none of the Trust, the Property Trustee, the Paying Agent,
the Registrar or any co-registrar shall be affected by
notice to the contrary.
(v) All Capital Securities issued upon any transfer
or exchange pursuant to the terms of this Declaration shall
evidence the same security and shall be entitled to the same
benefits under this Declaration as the Capital Securities
surrendered upon such transfer or exchange.
(i) No Obligation of the Property Trustee.
(i) The Property Trustee shall have no
responsibility or obligation to any beneficial owner of a
Global Capital Security, a Participant in the Clearing
Agency or other Person with respect to the accuracy of the
records of the Clearing Agency or its nominee or of any
Participant thereof, with respect to any ownership interest
in the Capital Securities or with respect to the delivery to
any Participant, beneficial owner or other Person (other
than the Clearing Agency) of any notice (including any
notice of redemption) or the payment of any amount, under or
with respect to such Capital Securities. All notices and
communications to be given to the Holders and all payments
to be made to Holders under the Capital Securities shall be
given or made only to or upon the order of the registered
Holders
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(which shall be the Clearing Agency or its nominee in the case of
a Global Capital Security). The rights of beneficial owners in
any Global Capital Security shall be exercised only through the
Clearing Agency subject to the applicable rules and procedures of
the Clearing Agency. The Property Trustee may conclusively rely
and shall be fully protected in relying upon information
furnished by the Clearing Agency 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 Declaration or under applicable law with respect to any
transfer of any interest in any Capital Security (including
any transfers between or among Clearing Agency Participants
or beneficial owners in any Global Capital 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 Declaration, and to examine the same to determine
substantial compliance as to form with the express
requirements hereof.
SECTION 9.3 Deemed Security Holders.
The Trustees may treat the Person in whose name any
Security shall be registered on the books and records of the
Trust as the sole owner of such Security for purposes of
receiving Distributions and for all other purposes whatsoever
and, accordingly, shall not be bound to recognize any equitable
or other claim to or interest in such Security on the part of any
Person, whether or not the Trust shall have actual or other
notice thereof.
SECTION 9.4 Book Entry Interests.
Global Capital Securities shall initially be registered
on the books and records of the Trust in the name of Cede & Co.,
the nominee of the Clearing Agency, and no Capital Security
Beneficial Owner will receive a definitive Capital Security
Certificate representing such Capital Security Beneficial Owner's
interests in such Global Capital Securities, except as provided
in Section 9.2. Unless and until definitive, fully registered
Capital Securities certificates have been issued to the Capital
Security Beneficial Owners pursuant to Section 9.2:
(a) the provisions of this Section 9.4 shall be in
full force and effect;
(b) the Trust and the Trustees shall be entitled to
deal with the Clearing Agency for all purposes of this
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Declaration (including the payment of Distributions on the
Global Capital Securities and receiving approvals, votes or
consents hereunder) as the Holder of the Capital Securities
and the sole holder of the Global Certificates and shall
have no obligation to the Capital Security Beneficial
Owners;
(c) to the extent that the provisions of this
Section 9.4 conflict with any other provisions of this
Declaration, the provisions of this Section 9.4 shall
control; and
(d) the rights of the Capital Security Beneficial
Owners shall be exercised only through the Clearing Agency
and shall be limited to those established by law and
agreements between such Capital Security Beneficial Owners
and the Clearing Agency and/or the Clearing Agency
Participants and receive and transmit payments of
Distributions on the Global Certificates to such Clearing
Agency Participants. DTC will make book entry transfers
among the Clearing Agency Participants.
SECTION 9.5 Notices to Clearing Agency.
Whenever a notice or other communication to the Capital
Security Holders is required under this Declaration, the Trustees
shall give all such notices and communications specified herein
to be given to the Holders of Global Capital Securities to the
Clearing Agency, and shall have no notice obligations to the
Capital Security Beneficial Owners.
SECTION 9.6 Appointment of Successor Clearing Agency.
If any Clearing Agency elects to discontinue its
services as securities depositary with respect to the Capital
Securities, the Administrative Trustees may, in their sole
discretion, appoint a successor Clearing Agency with respect to
such Capital Securities.
ARTICLE X
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
SECTION 10.1 Liability.
(a) Except as expressly set forth in this
Declaration, the Securities Guarantees and the terms of the
Securities, the Sponsor shall not be:
(i) personally liable for the return of any portion
of the capital contributions (or any return thereon) of the
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Holders of the Securities which shall be made solely from
assets of the Trust; and
(ii) be required to pay to the Trust or to any Holder
of Securities any deficit upon dissolution of the Trust or
otherwise.
(b) The Sponsor shall be liable for all of the debts
and obligations of the Trust (other than with respect to the
Securities) to the extent not satisfied out of the Trust's
assets.
(c) Pursuant to SECTION 3803(a) of the Business Trust Act,
the Holders of the Capital Securities 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.
SECTION 10.2 Exculpation.
(a) No Indemnified Person shall be liable,
responsible or accountable in damages or otherwise to the Trust
or any Covered Person for any loss, damage or claim incurred by
reason of 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 the authority conferred on such Indemnified Person
by this Declaration or by law, except that an Indemnified Person
shall be liable for any such loss, damage or claim incurred by
reason of such Indemnified Person's gross negligence or willful
misconduct with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected
in relying in good faith upon the records of the Trust and upon
such information, opinions, reports or statements presented to
the Trust by any Person as to matters the Indemnified Person
reasonably believes are within such other Person's professional
or expert competence and who has been selected with reasonable
care by or on behalf of the Trust, including information,
opinions, reports or statements as to the value and amount of the
assets, liabilities, profits, losses, or any other facts
pertinent to the existence and amount of assets from which
Distributions to Holders of Securities might properly be paid.
SECTION 10.3 Fiduciary Duty.
(a) To the extent that, at law or in equity, an
Indemnified Person has duties (including fiduciary duties) and
liabilities relating thereto to the Trust or to any other Covered
Person, an Indemnified Person acting under this Declaration shall
not be liable to the Trust or to any other Covered Person for its
good faith reliance on the provisions of this Declaration. The
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provisions of this Declaration, to the extent that they restrict
the duties and liabilities of an Indemnified Person otherwise
existing at law or in equity (other than the duties imposed on
the Property Trustee under the Trust Indenture Act), are agreed
by the parties hereto to replace such other duties and
liabilities of such Indemnified Person.
(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises
between any Covered Persons; or
(ii) whenever this Declaration or any other agreement
contemplated herein or therein provides that an Indemnified
Person shall act in a manner that is, or provides terms that
are, fair and reasonable to the Trust or any Holder of
Securities,
the Indemnified Person shall resolve such conflict of interest,
take such action or provide such terms, considering in each case
the relative interest of each party (including its own interest)
to such conflict, agreement, transaction or situation and the
benefits and burdens relating to such interests, any customary or
accepted industry practices, and any applicable generally
accepted accounting practices or principles. In the absence of
bad faith by the Indemnified Person, the resolution, action or
term so made, taken or provided by the Indemnified Person shall
not constitute a breach of this Declaration or any other
agreement contemplated herein or of any duty or obligation of the
Indemnified Person at law or in equity or otherwise.
(c) Whenever in this Declaration an Indemnified
Person is permitted or required to make a decision:
(i) in its "discretion" or under a grant of similar
authority, the Indemnified Person shall be entitled to
consider such interests and factors as it desires, including
its own interests, and shall have no duty or obligation to
give any consideration to any interest of or factors
affecting the Trust or any other Person; or
(ii) in its "good faith" or under another express
standard, the Indemnified Person shall act under such
express standard and shall not be subject to any other or
different standard imposed by this Declaration or by
applicable law.
SECTION 10.4 Indemnification.
(a) (i) The Debenture Issuer shall indemnify, to the
full extent permitted by law, any Company Indemnified Person
who was or is a party or is threatened to be made a party to
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any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of
the Trust) by reason of the fact that he is or was a Company
Indemnified Person against expenses (including attorneys'
fees and expenses), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in
connection with such action, suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be
in or not opposed to the best interests of the Trust, and,
with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The
termination of any action, suit or proceeding by judgment,
order, settlement, conviction, or upon a plea of nolo
contendere or its equivalent, shall not, of itself, create a
presumption that the Company Indemnified Person did not act
in good faith and in a manner which he reasonably believed
to be in or not opposed to the best interests of the Trust,
and, with respect to any criminal action or proceeding, had
reasonable cause to believe that his conduct was unlawful.
(ii) The Debenture Issuer shall indemnify, to the
full extent permitted by law, any Company Indemnified Person
who was or is a party or is threatened to be made a party to
any threatened, pending or completed action or suit by or in
the right of the Trust to procure a judgment in its favor by
reason of the fact that he is or was a Company Indemnified
Person against expenses (including attorneys' fees and
expenses) actually and reasonably incurred by him in
connection with the defense or settlement of such action or
suit if he acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of
the Trust and except that no such indemnification shall be
made in respect of any claim, issue or matter as to which
such Company Indemnified Person shall have been adjudged to
be liable to the Trust unless and only to the extent that
the Court of Chancery of Delaware or the court in which such
action or suit was brought shall determine upon application
that, despite the adjudication of liability but in view of
all the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses which
such Court of Chancery or such other court shall deem
proper.
(iii) To the extent that a Company Indemnified Person
shall be successful on the merits or otherwise (including
dismissal of an action without prejudice or the settlement
of an action without admission of liability) in defense of
any action, suit or proceeding referred to in paragraphs (i)
and (ii) of this Section 10.4(a), or in defense of any
claim, issue or matter therein, he shall be indemnified, to
the full extent permitted by law, against expenses
(includ-
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ing attorneys' fees) actually and reasonably incurred by him in
connection therewith.
(iv) Any indemnification under paragraphs (i) and
(ii) of this Section 10.4(a) (unless ordered by a court)
shall be made by the Debenture Issuer only as authorized in
the specific case upon a determination that indemnification
of the Company Indemnified Person is proper in the
circumstances because he has met the applicable standard of
conduct set forth in paragraphs (i) and (ii). Such
determination shall be made (1) by the Administrative
Trustees by a majority vote of a quorum consisting of such
Administrative Trustees who were not parties to such action,
suit or proceeding, (2) if such a quorum is not obtainable,
or, even if obtainable, if a quorum of disinterested
Administrative Trustees so directs, by independent legal
counsel in a written opinion, or (3) by the Common Security
Holder of the Trust.
(v) Expenses (including attorneys' fees and
expenses) incurred by a Company Indemnified Person in
defending a civil, criminal, administrative or investigative
action, suit or proceeding referred to in paragraphs (i) and
(ii) of this Section 10.4(a) shall be paid by the Debenture
Issuer in advance of the final disposition of such action,
suit or proceeding upon receipt of an undertaking by or on
behalf of such Company Indemnified Person to repay such
amount if it shall ultimately be determined that he is not
entitled to be indemnified by the Debenture Issuer as
authorized in this Section 10.4(a). Notwithstanding the
foregoing, no advance shall be made by the Debenture Issuer
if a determination is reasonably and promptly made (i) by
the Administrative Trustees by a majority vote of a quorum
of disinterested Administrative Trustees, (ii) if such a
quorum is not obtainable, or, even if obtainable, if a
quorum of disinterested Administrative Trustees so directs,
by independent legal counsel in a written opinion or (iii)
the Common Security Holder of the Trust, that, based upon
the facts known to the Administrative Trustees, counsel or
the Common Security Holder at the time such determination is
made, such Company Indemnified Person acted in bad faith or
in a manner that such person did not believe to be in or not
opposed to the best interests of the Trust, or, with respect
to any criminal proceeding, that such Company Indemnified
Person believed or had reasonable cause to believe his
conduct was unlawful. In no event shall any advance be made
in instances where the Administrative Trustees, independent
legal counsel or Common Security Holder reasonably determine
that such person deliberately breached his duty to the Trust
or its Common or Capital Security Holders.
(vi) The indemnification and advancement of expenses
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provided by, or granted pursuant to, the other paragraphs of
this Section 10.4(a) shall not be deemed exclusive of any
other rights to which those seeking indemnification and
advancement of expenses may be entitled under any agreement,
vote of stockholders or disinterested directors of the
Debenture Issuer or Capital Security Holders of the Trust or
otherwise, both as to action in his official capacity and as
to action in another capacity while holding such office.
All rights to indemnification under this Section 10.4(a)
shall be deemed to be provided by a contract between the
Debenture Issuer and each Company Indemnified Person who
serves in such capacity at any time while this Section
10.4(a) is in effect. Any repeal or modification of this
Section 10.4(a) shall not affect any rights or obligations
then existing.
(vii) The Debenture Issuer or the Trust may purchase
and maintain insurance on behalf of any person who is or was
a Company Indemnified Person 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
Debenture Issuer would have the power to indemnify him
against such liability under the provisions of this Section
10.4(a).
(viii) For purposes of this Section 10.4(a),
references to "the Trust" shall include, in addition to the
resulting or surviving entity, any constituent entity
(including any constituent of a constituent) absorbed in a
consolidation or merger, so that any person who is or was a
director, trustee, officer or employee of such constituent
entity, or is or was serving at the request of such
constituent entity as a director, trustee, officer, employee
or agent of another entity, shall stand in the same position
under the provisions of this Section 10.4(a) with respect to
the resulting or surviving entity as he would have with
respect to such constituent entity if its separate existence
had continued.
(ix) The indemnification and advancement of expenses
provided by, or granted pursuant to, this Section 10.4(a)
shall, unless otherwise provided when authorized or
ratified, continue as to a person who has ceased to be a
Company Indemnified Person and shall inure to the benefit of
the heirs, executors and administrators of such a person.
(b) The Debenture Issuer agrees to indemnify the (i)
Property Trustee, (ii) the Delaware Trustee, (iii) any Affiliate
of the Property Trustee and the Delaware Trustee, and (iv) any
officers, directors, shareholders, members, partners, employees,
representatives, custodians, nominees or agents of the Property
Trustee and the Delaware Trustee (each of the Persons in (i)
through (iv) being referred to as a "Fiduciary Indemnified
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Person") for, and to hold each Fiduciary Indemnified Person
harmless against, any and all loss, liability, damage, claim or
expense including taxes (other than taxes based on the income of
such Fiduciary Indemnified Person) incurred without negligence or
bad faith on its part, arising out of or in connection with the
acceptance or administration of the trust or trusts hereunder,
including the costs and expenses (including reasonable legal fees
and expenses) of defending itself against or investigating any
claim or liability in connection with the exercise or performance
of any of its powers or duties hereunder. The obligation to
indemnify as set forth in this Section 10.4(b) shall survive the
satisfaction and discharge of this Declaration.
SECTION 10.5 Outside Businesses.
Any Covered Person, the Sponsor, the Delaware Trustee
and the Property 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
Securities shall have no rights by virtue of this Declaration in
and to such independent ventures or the income or profits 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. No Covered Person, the Sponsor, the
Delaware Trustee, or the Property 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 any
Covered Person, the Sponsor, the Delaware Trustee and the
Property 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
Covered Person, the Delaware Trustee and the Property Trustee may
engage or be interested in any financial or other transaction
with the Sponsor or any Affiliate of the Sponsor, 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
Sponsor or its Affiliates.
ARTICLE XI
ACCOUNTING
SECTION 11.1 Fiscal Year.
The fiscal year ("Fiscal Year") of the Trust shall be
the calendar year, or such other year as is required by the Code.
SECTION 11.2 Certain Accounting Matters.
(a) At all times during the existence of the Trust,
the Administrative Trustees shall keep, or cause to be kept, full
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books of account, records and supporting documents, which shall
reflect in reasonable detail, each transaction of the Trust. The
books of account shall be maintained on the accrual method of
accounting, in accordance with generally accepted accounting
principles, consistently applied. The Trust shall use the
accrual method of accounting for United States Federal income tax
purposes. The books of account and the records of the Trust
shall be examined by and reported upon as of the end of each
Fiscal Year of the Trust by a firm of independent certified
public accountants selected by the Administrative Trustees.
(b) The Administrative Trustees shall cause to be
prepared and delivered to each of the Holders of Securities,
within 90 days after the end of each Fiscal Year of the Trust,
annual financial statements of the Trust, including a balance
sheet of the Trust as of the end of such Fiscal Year, and the
related statements of income or loss;
(c) The Administrative Trustees shall cause to be
duly prepared and delivered to each of the Holders of Securities,
any annual United States Federal income tax information
statement, required by the Code, containing such information with
regard to the Securities held by each Holder as is required by
the Code and the Treasury Regulations. Notwithstanding any right
under the Code to deliver any such statement at a later date, the
Administrative Trustees shall endeavor to deliver all such
information statements within 30 days after the end of each
Fiscal Year of the Trust.
(d) The Administrative Trustees shall cause to be
duly prepared and filed with the appropriate taxing authority, an
annual United States Federal income tax return, on a Form 1041 or
such other form required by United States Federal income tax law,
and any other annual income tax returns required to be filed by
the Administrative Trustees on behalf of the Trust with any state
or local taxing authority.
SECTION 11.3 Banking.
The Trust shall maintain one or more bank accounts in
the name and for the sole benefit of the Trust; provided,
however, that all payments of funds in respect of the Debentures
held by the Property Trustee shall be made directly to the
Property Trustee Account and no other funds of the Trust shall be
deposited in the Property Trustee Account. The sole signatories
for such accounts shall be designated by the Administrative
Trustees; provided, however, that the Property Trustee shall
designate the signatories for the Property Trustee Account.
SECTION 11.4 Withholding.
The Trust and the Administrative Trustees shall comply
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with all withholding requirements under United States Federal,
state and local law. The Trust shall request, and the Holders
shall provide to the Trust, such forms or certificates as are
necessary to establish an exemption from withholding with respect
to each Holder, and any representations and forms as shall
reasonably be requested by the Trust to assist it in determining
the extent of, and in fulfilling, its withholding obligations.
The Administrative Trustees shall file required forms with
applicable jurisdictions and, unless an exemption from
withholding is properly established by a Holder, shall remit
amounts withheld with respect to the Holder to applicable
jurisdictions. To the extent that the Trust is required to
withhold and pay over any amounts to any authority with respect
to Distributions or allocations to any Holder, the amount
withheld shall be deemed to be a Distribution in the amount of
the withholding to the Holder. In the event of any claimed over
withholding, Holders shall be limited to an action against the
applicable jurisdiction. If the amount required to be withheld
was not withheld from actual Distributions made, the Trust may
reduce subsequent Distributions by the amount of such
withholding.
ARTICLE XII
AMENDMENTS AND MEETINGS
SECTION 12.1 Amendments.
(a) Except as otherwise provided in this Declaration
or by any applicable terms of the Securities, this Declaration
may only be amended by a written instrument approved and executed
by:
(i) the Administrative Trustees (or if there are
more than two Administrative Trustees a majority of the
Administrative Trustees);
(ii) if the amendment affects the rights, powers,
duties, obligations or immunities of the Property Trustee,
the Property Trustee; and
(iii) if the amendment affects the rights, powers,
duties, obligations or immunities of the Delaware Trustee,
the Delaware Trustee.
(b) No amendment shall be made, and any such
purported amendment shall be void and ineffective:
(i) unless, in the case of any proposed amendment,
the Property Trustee shall have first received an Officers'
Certificate from each of the Trust and the Sponsor that such
amendment is permitted by, and conforms to, the terms of
this Declaration (including the terms of the Securities);
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(ii) unless, in the case of any proposed amendment
which affects the rights, powers, duties, obligations or
immunities of the Property Trustee, the Property Trustee
shall have first received:
(A) an Officers' Certificate from each of the
Trust and the Sponsor that such amendment is permitted
by, and conforms to, the terms of this Declaration
(including the terms of the Securities); and
(B) an opinion of counsel (who may be counsel
to the Sponsor or the Trust) that such amendment is
permitted by, and conforms to, the terms of this
Declaration (including the terms of the Securities),
provided, however, that the Property Trustee shall not be
required to sign any such amendment, and
(iii) to the extent the result of such amendment would
be to:
(A) cause the Trust to fail to continue to be
classified for purposes of United States Federal income
taxation as a grantor trust;
(B) reduce or otherwise adversely affect the
powers of the Property Trustee in contravention of the
Trust Indenture Act; or
(C) cause the Trust to be deemed to be an
Investment Company required to be registered under the
Investment Company Act;
(c) At such time after the Trust has issued any
Securities that remain outstanding, any amendment that would
adversely affect the rights, privileges or preferences of any
Holder of Securities may be effected only with such additional
requirements as may be set forth in the terms of such Securities;
(d) Section 9.1(c) and this Section 12.1 shall not
be amended without the consent of all of the Holders of the
Securities;
(e) Article Four shall not be amended without the
consent of the Holders of a Majority in liquidation amount of the
Common Securities and;
(f) The rights of the holders of the Common
Securities under Article Five to increase or decrease the number
of, and appoint and remove Trustees shall not be amended without
the consent of the Holders of a Majority in liquidation amount of
the Common Securities; and
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(g) Notwithstanding Section 12.1(c), this
Declaration may be amended without the consent of the Holders of
the Securities to:
(i) cure any ambiguity, correct or supplement any
provision in this Declaration that may be inconsistent with
any other provision of this Declaration or to make any other
provisions with respect to matters or questions arising
under this Declaration which shall not be inconsistent with
the other provisions of the Declaration; and
(ii) to modify, eliminate or add to any provisions of
the Declaration to such extent as shall be necessary to
ensure that the Trust will be classified for United States
Federal income tax purposes as a grantor trust at all times
that any Securities are outstanding or to ensure that the
Trust will not be required to register as an Investment
Company under the Investment Company Act.
provided, however, that in the case of clause (i), such action
shall not adversely affect in any material respect the interests
of the Holders of the Securities, and any amendments of this
Declaration shall become effective when notice thereof is given
to the Holders of the Securities.
SECTION 12.2 Meetings of the Holders of Securities; Action by
Written Consent.
(a) Meetings of the Holders of any class of
Securities may be called at any time by the Administrative
Trustees (or as provided in the terms of the Securities) to
consider and act on any matter on which Holders of such class of
Securities are entitled to act under the terms of this
Declaration, the terms of the Securities or the rules of any
stock exchange on which the Capital Securities are listed or
admitted for trading. The Administrative Trustees shall call a
meeting of the Holders of such class if directed to do so by the
Holders of at least 10% in liquidation amount of such class of
Securities. Such direction shall be given by delivering to the
Administrative Trustees one or more notice in a writing stating
that the signing Holders of Securities wish to call a meeting and
indicating the general or specific purpose for which the meeting
is to be called. Any Holders of Securities calling a meeting
shall specify in writing the Security Certificates held by the
Holders of Securities exercising the right to call a meeting and
only those Securities specified shall be counted for purposes of
determining whether the required percentage set forth in the
second sentence of this paragraph has been met.
(b) Except to the extent otherwise provided in the
terms of the Securities, the following provisions shall apply to
meetings of Holders of Securities:
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(i) notice of any such meeting shall be given to all
the Holders of Securities having a right to vote thereat at
least seven days and not more than 60 days before the date
of such meeting. Whenever a vote, consent or approval of
the Holders of Securities is permitted or required under
this Declaration or the rules of any stock exchange on which
the Capital Securities are listed or admitted for trading,
such vote, consent or approval may be given at a meeting of
the Holders of Securities. Any action that may be taken at
a meeting of the Holders of Securities may be taken without
a meeting if a consent in writing setting forth the action
so taken is signed by the Holders of Securities owning not
less than the minimum amount of Securities in liquidation
amount that would be necessary to authorize or take such
action at a meeting at which all Holders of Securities
having a right to vote thereon were present and voting.
Prompt notice of the taking of action without a meeting
shall be given to the Holders of Securities entitled to vote
who have not consented in writing. The Administrative
Trustees may specify that any written ballot submitted to
the Security Holder for the purpose of taking any action
without a meeting shall be returned to the Trust within the
time specified by the Administrative Trustees;
(ii) each Holder of a Security may authorize any
Person to act for it by proxy on all matters in which a
Holder of Securities is entitled to participate, including
waiving notice of any meeting, or voting or participating at
a meeting. No proxy shall be valid after the expiration of
11 months from the date thereof unless otherwise provided in
the proxy. Every proxy shall be revocable at the pleasure
of the Holder of Securities executing it. Except as
otherwise provided herein, all matters relating to the
giving, voting or validity of proxies shall be governed by
the General Corporation Law of the State of Delaware
relating to proxies, and judicial interpretations
thereunder, as if the Trust were a Delaware corporation and
the Holders of the Securities were stockholders of a
Delaware corporation;
(iii) each meeting of the Holders of the Securities
shall be conducted by the Administrative Trustees or by such
other Person that the Administrative Trustees may designate;
and
(iv) unless the Business Trust Act, this Declaration,
the terms of the Securities, the Trust Indenture Act or the
listing rules of any stock exchange on which the Capital
Securities are then listed or trading, otherwise provides,
the Administrative Trustees, in their sole discretion, shall
establish all other provisions relating to meetings of
Holders of Securities, including notice of the time, place
or purpose of any meeting at which any matter is to be voted
on
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by any Holders of Securities, waiver of any such notice,
action by consent without a meeting, the establishment of a
record date, quorum requirements, voting in person or by
proxy or any other matter with respect to the exercise of
any such right to vote.
ARTICLE XIII
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
SECTION 13.1 Representations and Warranties of Property
Trustee.
The Trustee that acts as initial Property Trustee
represents and warrants to the Trust and to the Sponsor at the
date of this Declaration, and each Successor Property Trustee
represents and warrants to the Trust and the Sponsor at the time
of the Successor Property Trustee's acceptance of its appointment
as Property Trustee that:
(a) The Property Trustee is a New York banking
corporation with trust powers and authority to execute and
deliver, and to carry out and perform its obligations under the
terms of, this Declaration;
(b) The execution, delivery and performance by the
Property Trustee of the Declaration has been duly authorized by
all necessary corporate action on the part of the Property
Trustee. The Declaration has been duly executed and delivered by
the Property Trustee and constitutes a legal, valid and binding
obligation of the Property Trustee, enforceable against it in
accordance with its terms, subject to applicable bankruptcy,
reorganization, moratorium, insolvency, and other similar laws
affecting creditors' rights generally and to general principles
of equity and the discretion of the court (regardless of whether
the enforcement of such remedies is considered in a proceeding in
equity or at law);
(c) The execution, delivery and performance of this
Declaration by the Property Trustee does not conflict with or
constitute a breach of the charter or by-laws of the Property
Trustee; and
(d) No consent, approval or authorization of, or
registration with or notice to, any New York State or Federal
banking authority is required for the execution, delivery or
performance by the Property Trustee of this Declaration.
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SECTION 13.2 Representations and Warranties of Delaware
Trustee.
The Trustee that acts as initial Delaware Trustee
represents and warrants to the Trust and to the Sponsor at the
date of this Declaration, and each Successor Delaware Trustee
represents and warrants to the Trust and the Sponsor at the time
of the Successor Delaware Trustee's acceptance of its appointment
as Delaware Trustee that:
(a) The Delaware Trustee is duly organized, validly
existing and in good standing under the laws of the State of
Delaware, with trust power and authority to execute and deliver,
and to carry out and perform its obligations under the terms of,
this Declaration;
(b) The execution, delivery and performance by the
Delaware Trustee of this Declaration has been duly authorized by
all necessary corporate action on the part of the Delaware
Trustee. This Declaration has been duly executed and delivered
by the Delaware Trustee and constitutes a legal, valid and
binding obligation of the Delaware Trustee, enforceable against
it in accordance with its terms, subject to applicable
bankruptcy, reorganization, moratorium, insolvency, and other
similar laws affecting creditors' rights generally and to general
principles of equity and the discretion of the court (regardless
of whether the enforcement of such remedies is considered in a
proceeding in equity or at law);
(c) No consent, approval or authorization of, or
registration with or notice to, any Federal banking authority is
required for the execution, delivery or performance by the
Delaware Trustee of this Declaration; and
(d) The Delaware Trustee is 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.
ARTICLE XIV
MISCELLANEOUS
SECTION 14.1 Notices.
All notices provided for in this Declaration shall be
in writing, duly signed by the party giving such notice, and
shall be delivered, telecopied or mailed by first class mail, as
follows:
(a) if given to the Trust, in care of the
Administrative Trustees at the Trust's mailing address set forth
below
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(or such other address as the Trust may give notice of to the Holders
of the Securities):
BankBoston Capital Trust III
P.O. Box 2016
Boston, Massachusetts 02106-2016
Attention: Kathleen M. McGillycuddy,
Administrative Trustee
(b) if given to the Delaware Trustee, at the mailing
address set forth below (or such other address as Delaware
Trustee may give notice of to the Holders of the Securities):
The Bank of New York (Delaware)
23 White Clay Center
Route 273
Newark, Delaware 19711
Attention: Corporate Trust Department
(c) if given to the Property Trustee, at the
Property Trustee's mailing address set forth below (or such other
address as the Property Trustee may give notice of to the Holders
of the Securities):
The Bank of New York
101 Barclay Street, 21 West
New York, New York 10283
Attention: Corporate Trust
Trustee Administration
(d) if given to the Holder of the Common Securities,
at the mailing address of the Sponsor set forth below (or such
other address as the Holder of the Common Securities may give
notice to the Trust):
BankBoston Corporation
100 Federal Street, MA BOS 01-25-01
Boston, Massachusetts 02110
Attention: Gary A. Spiess, General Counsel
(e) if given to any other Holder, at the address set
forth on the books and records of the Trust.
All such notices 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
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delivered on the date of such refusal or inability to deliver.
SECTION 14.2 Governing Law.
This Declaration and the rights of the parties
hereunder shall be governed by and interpreted in accordance with
the laws of the State of Delaware and all rights and remedies
shall be governed by such laws without regard to principles of
conflict of laws.
SECTION 14.3 Intention of the Parties.
It is the intention of the parties hereto that the
Trust be classified for United States Federal income tax purposes
as a grantor trust. The provisions of this Declaration shall be
interpreted to further this intention of the parties.
SECTION 14.4 Headings.
Headings contained in this Declaration are inserted for
convenience of reference only and do not affect the
interpretation of this Declaration or any provision hereof.
SECTION 14.5 Successors and Assigns
Whenever in this Declaration any of the parties hereto
is named or referred to, the successors and assigns of such party
shall be deemed to be included, and all covenants and agreements
in this Declaration by the Sponsor and the Trustees shall bind
and inure to the benefit of their respective successors and
assigns, whether so expressed.
SECTION 14.6 Partial Enforceability.
If any provision of this Declaration, or the
application of such provision to any Person or circumstance,
shall be held invalid, the remainder of this Declaration, or the
application of such provision to persons or circumstances other
than those to which it is held invalid, shall not be affected
thereby.
SECTION 14.7 Counterparts.
This Declaration may contain more than one counterpart
of the signature page and this Declaration may be executed by the
affixing of the signature of each of the Trustees to one of such
counterpart signature pages. All of such counterpart signature
pages shall be read as though one, and they shall have the same
force and effect as though all of the signers had signed a single
signature page.
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IN WITNESS WHEREOF, the undersigned has caused these
presents to be executed as of the day and year first above
written.
__________________________________
Robert T. Jefferson, as
Administrative Trustee
__________________________________
Craig V. Starble, as Administrative
Trustee
__________________________________
Kathleen M. McGillycuddy, as
Administrative Trustee
THE BANK OF NEW YORK (DELAWARE),
as Delaware Trustee
By:
------------------------------
Name:
Title:
THE BANK OF NEW YORK
as Property Trustee
By:
------------------------------
Name:
Title:
BANKBOSTON CORPORATION
as Sponsor
By:
------------------------------
Name: Kathleen M. McGillycuddy
Title: Executive Director,
Global Treasury
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ANNEX I
TERMS OF
FLOATING RATE CAPITAL SECURITIES
FLOATING RATE COMMON SECURITIES
Pursuant to Section 7.1 of the Amended and Restated
Declaration of Trust, dated as of _______, 1997 (as amended from
time to time, the "Declaration"), the designation, rights,
privileges, restrictions, preferences and other terms and
provisions of the Capital Securities and the Common Securities
(collectively, the "Securities") are set out below (each
capitalized term used but not defined herein has the meaning set
forth in the Declaration or, if not defined in such Declaration,
as defined in the Indenture):
1. Designation and Number.
(a) Capital Securities. 250,000 Capital Securities of
the Trust, with an aggregate liquidation amount with respect to
the assets of the Trust of two hundred fifty million dollars
($250,000,000), and with a liquidation amount with respect to the
assets of the Trust of $1,000 per security, are hereby designated
for the purposes of identification only as "Floating Rate Capital
Securities" (the "Capital Securities"). The certificates
evidencing the Capital Securities shall be substantially in the
form of Exhibit A-1 to the Declaration, with such changes and
additions thereto or deletions therefrom as may be required by
ordinary usage, custom or practice or to conform to the rules of
any stock exchange or quotation system on which the Capital
Securities are listed or quoted.
(b) Common Securities. 7,732 Common Securities of the
Trust with an aggregate liquidation amount with respect to the
assets of the Trust of seven million seven hundred thirty-two
thousand dollars ($7,732,000) and with a liquidation amount with
respect to the assets of the Trust of $1,000 per security, are
hereby designated for the purposes of identification only as
"Floating Rate Common Securities" (the "Common Securities"). The
certificates evidencing the Common Securities shall be
substantially in the form of Exhibit A-2 to the Declaration, with
such changes and additions thereto or deletions therefrom as may
be required by ordinary usage, custom or practice.
2. Distributions.
(a) Distributions on each Security will be payable at
a rate per annum equal to LIBOR plus ____% (the "Distribution
Rate") of the liquidation amount of $1,000 per Security (the
"Liquidation Amount"), such rate being the rate of interest
pay-
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able on the Debentures to be held by the Property Trustee.
LIBOR and the amount payable in respect of a Distribution for a
Distribution Period (as defined herein) will be calculated by the
Calculation Agent in the same manner as LIBOR and the interest
payable in respect of each Interest Period for the Debentures, as
set forth in the Indenture. Distributions in arrears for more
than one quarterly period will bear additional distributions
thereon compounded quarterly at the applicable periodic
Distribution Rate (to the extent permitted by applicable law).
The term "Distributions", as used herein, includes any such
additional distributions unless otherwise stated. A Distribution
is payable only to the extent that payments are made in respect
of the Debentures held by the Property Trustee and to the extent
the Property Trustee has funds on hand legally available
therefor.
(b) Distributions on the Securities will be
cumulative, will accumulate from the most recent date to which
Distributions have been paid or, if no Distributions have been
paid, from _______, 1997, to but excluding the related
Distribution Date (as defined herein) and will be payable
quarterly in arrears on _______, _______, _______, and _______ of
each year, commencing on _______, 1997 (each, a "Distribution
Date"), except as otherwise described below. The amount of
Distributions payable for any Distribution Period will be
computed on the basis of the actual number of days elapsed in
such period and a year of 360 days. "Distribution Period" means
the period from and including a Distribution Date (or _______,
1997, in the case of the first Distribution Period) to but
excluding the next Distribution Date. If a Distribution Date is
not a Business Day, then such Distribution Date and the first day
of the next succeeding Distribution Period will be the next
succeeding Business Day, except if such Business Day is in the
next succeeding calendar month, such Distribution Date and the
first day of the next succeeding Distribution Period will be the
immediately preceding Business Day. As long as no Event of
Default has occurred and is continuing under the Indenture, the
Debenture Issuer has the right under the Indenture to defer
payments of interest by extending the interest payment period at
any time and from time to time on the Debentures for a period not
exceeding 20 consecutive quarterly periods, including the first
such quarterly period during such period (each an "Extension
Period"), during which Extension Period no interest shall be due
and payable on the Debentures, provided that no Extension Period
shall extend beyond the Maturity Date of the Debentures. As a
consequence of such deferral, Distributions will also be
deferred. Despite such deferral, quarterly Distributions will
continue to accumulate with additional interest thereon (to the
extent permitted by applicable law but not at a rate greater than
the rate at which interest is then accruing on the Debentures) at
the Distribution Rate then in effect compounded quarterly during
any such Extension Period. At the end of the Extension Period,
all accrued and unpaid Distributions (but only to the extent
payments are made in respect of the
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Debentures held by the Property Trustee and to the extent the Property
Trustee has funds available therefor) will be payable to the Holders
as they appear on the books and records of the Trust on the first
record date after the end of the Extension Period. Prior to the
termination of any such Extension Period, the Debenture Issuer may
further defer payments of interest by further extending such Extension
Period; provided that such Extension Period, together with all such
previous and further extensions within such Extension Period, may not
exceed 20 consecutive quarterly periods, including the first quarterly
period during such Extension Period, or extend beyond the Maturity
Date of the Debentures. Upon the termination of any Extension Period
and the payment of all amounts then due, the Debenture Issuer may
commence a new Extension Period, subject to the above requirements.
(c) Distributions on the Securities will be payable to
the Holders thereof as they appear on the books and records of
the Trust on the [first day of the month in which] the relevant
Distribution Date occurs, which Distribution Dates correspond to
the interest payment dates on the Debentures. Subject to any
applicable laws and regulations and the provisions of the
Declaration, each such payment in respect of the Capital
Securities will be made as described under the heading
"Description of Capital Securities -- Form, Denomination, Book-
Entry Procedures and Transfer" in the Prospectus dated _______,
1997, of the Debenture Issuer and the Trust relating to the
Securities and the Debentures. The relevant record dates for the
Common Securities shall be the same as the record dates for the
Capital Securities. Distributions payable on any Securities that
are not punctually paid on any Distribution Date, as a result of
the Debenture Issuer having failed to make a payment under the
Debentures, will cease to be payable to the Holder on the
relevant record date, and such defaulted Distribution will
instead be payable to the Person in whose name such Securities
are registered on the special record date or other specified date
determined in accordance with the Indenture.
(d) The Bank of New York shall act as Calculation
Agent to determine LIBOR and calculate the Distribution Rate of,
and the amount of Distributions payable on, the Securities for
each Distribution Period pursuant to the terms set forth herein
and in the Securities.
(e) In the event that there is any money or other
property held by or for the Trust that is not accounted for
hereunder, such property shall be distributed Pro Rata (as
defined herein) among the Holders of the Securities.
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3. Liquidation Distribution Upon Dissolution.
In the event of any termination of the Trust or the
Sponsor otherwise gives notice of its election to liquidate the
Trust pursuant to Section 8.1(a)(iii) of the Declaration, the
Trust shall be liquidated by the Administrative Trustees as
expeditiously as the Administrative Trustees determine to be
possible by distributing, after satisfaction of liabilities to
creditors of the Trust as provided by applicable law, to the
Holders of the Securities a Like Amount (as defined below) of the
Debentures, unless such distribution is determined by the
Property Trustee not to be practicable, in which event such
Holders will be entitled to receive out of the assets of the
Trust legally available for distribution to Holders, after
satisfaction of liabilities to creditors of the Trust as provided
by applicable law, an amount equal to the aggregate of the
liquidation amount of $1,000 per Security plus accumulated and
unpaid Distributions thereon to the date of payment (such amount
being the "Liquidation Distribution").
"Like Amount" means (i) with respect to a redemption of
the Securities, Securities having a Liquidation Amount equal to
the principal amount of Debentures to be paid in accordance with
their terms and (ii) with respect to a distribution of Debentures
upon the liquidation of the Trust, Debentures having a principal
amount equal to the Liquidation Amount of the Securities of the
Holder to whom such Debentures are distributed.
If, upon any such liquidation, the Liquidation
Distribution can be paid only in part because the Trust has
insufficient assets on hand legally available to pay in full the
aggregate Liquidation Distribution, then the amounts payable
directly by the Trust on the Securities shall be paid on a Pro
Rata basis.
4. Redemption and Distribution.
(a) Upon the repayment of the Debentures in whole or
in part, at maturity or upon early redemption in accordance with
the terms thereof, the proceeds from such repayment shall be
simultaneously applied by the Property Trustee (subject to the
Property Trustee having received notice no later than 45 days
prior to such repayment) to redeem a Like Amount of the
Securities at a redemption price equal to (i) in the case of the
repayment of the Debentures at maturity, the Maturity Redemption
Price (as defined below), (ii) in the case of the optional
redemption of the Debentures upon the occurrence and continuation
of a Special Event, the Early Redemption Price (as defined below)
and (iii) in the case of the optional redemption of the
Debentures other than as a result of the occurrence and
continuance of a Special Event, the Early Redemption Price. The
Maturity Redemption Price and the Early Redemption Price are
referred to collectively as the "Redemption Price". Holders will
be given
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not less than 30 nor more than 60 days notice of such redemption.
(b) (i) "Maturity Redemption Price" shall mean a price
equal to 100% of the Liquidation Amount of the Securities to be
redeemed plus accumulated and unpaid Distributions thereon, if
any, to the date of redemption.
(ii) Early Redemption Price" shall mean a price equal
to 100% of the Liquidation Amount of the Securities to be
redeemed plus accumulated and unpaid Distributions thereon, if
any, to the date of redemption.
(c) On and from the date fixed by the Administrative
Trustees for any distribution of Debentures and liquidation of
the Trust: (i) the Securities will no longer be deemed to be
outstanding, (ii) the Clearing Agency or its nominee (or any
successor Clearing Agency or its nominee), as the Holder of the
Capital Securities, will receive a registered global certificate
or certificates representing the Debentures to be delivered upon
such distribution and any certificates representing Securities
not held by the Clearing Agency or its nominee (or any successor
Clearing Agency or its nominee) will be deemed to represent
beneficial interests in a Like Amount of Debentures until such
certificates are presented to the Debenture Issuer or its agent
for transfer or reissue.
(d) The Trust may not redeem fewer than all the
outstanding Securities unless all accumulated and unpaid
Distributions have been paid on all Securities for all quarterly
Distribution periods terminating on or before the date of
redemption.
(e) The procedure with respect to redemptions or
distributions of Debentures shall be as follows:
(i) Notice of any redemption of, or notice of
distribution of Debentures in exchange for, the Securities
(a "Redemption/Distribution Notice") will be given by the
Trust by mail to each Holder of Securities to be redeemed or
exchanged not fewer than 30 nor more than 60 days before the
date fixed for redemption or exchange thereof which, in the
case of a redemption, will be the date fixed for redemption
of the Debentures. For purposes of the calculation of the
date of redemption or exchange and the dates on which
notices are given pursuant to this Section 4(f)(i), a
Redemption/ Distribution Notice shall be deemed to be given
on the day such notice is first mailed by first-class mail,
postage prepaid, to Holders of Securities. Each
Redemption/Distribution Notice shall be addressed to the
Holders of Securities at the address of each such Holder
appearing in the books and records of the Trust. No defect
in the Redemption/Distribution Notice or in the mailing of
either thereof with respect to any Holder shall affect the
validity of the
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redemption or exchange proceedings with respect to any other
Holder.
(ii) In the event that fewer than all the outstanding
Securities are to be redeemed, the Securities to be redeemed
shall be redeemed Pro Rata from each Holder of Capital
Securities, it being understood that, in respect of Capital
Securities registered in the name of and held of record by
the Clearing Agency or its nominee (or any successor
Clearing Agency or its nominee) or any nominee, the
distribution of the proceeds of such redemption will be made
to the Clearing Agency and disbursed by such Clearing Agency
in accordance with the procedures applied by such agency or
nominee.
(iii) If Securities are to be redeemed and the Trust
gives a Redemption/Distribution Notice, (which notice will
be irrevocable), then (A) with respect to Capital Securities
issued in book-entry form, by 12:00 noon, New York City
time, on the redemption date, provided that the Debenture
Issuer has paid the Property Trustee a sufficient amount of
cash in connection with the related redemption or maturity
of the Debentures by 10:00 a.m., New York City time, on the
maturity date or the date of redemption, as the case
requires, the Property Trustee will deposit irrevocably with
the Clearing Agency or its nominee (or successor Clearing
Agency or its nominee) funds sufficient to pay the
applicable Redemption Price with respect to such Capital
Securities and will give the Clearing Agency irrevocable
instructions and authority to pay the Redemption Price to
the relevant Clearing Agency Participants, and (B) with
respect to Capital Securities issued in certificated form
and Common Securities, provided that the Debenture Issuer
has paid the Property Trustee a sufficient amount of cash in
connection with the related redemption or maturity of the
Debentures, the Property Trustee will pay the relevant
Redemption Price to the Holders of such Securities by check
mailed to the address of the relevant Holder appearing on
the books and records of the Trust on the redemption date.
If a Redemption/Distribution Notice shall have been given
and funds deposited as required, if applicable, then
immediately prior to the close of business on the date of
such deposit, or on the redemption date, as applicable,
Distributions will cease to accumulate on the Securities so
called for redemption and all rights of Holders of such
Securities so called for redemption will cease, except the
right of the Holders of such Securities to receive the
Redemption Price, but without interest on such Redemption
Price, and such Securities shall cease to be outstanding.
(iv) Payment of accumulated and unpaid Distributions
on the Redemption Date of the Securities will be subject to
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the rights of Holders of Securities on the close of business
on a regular record date in respect of a Distribution Date
occurring on or prior to such Redemption Date.
Neither the Administrative Trustees nor the Trust shall
be required to register or cause to be registered the transfer of
(i) any Securities beginning on the opening of business 15 days
before the day of mailing of a notice of redemption or any notice
of selection of Securities for redemption or (ii) any Securities
selected for redemption except the unredeemed portion of any
Security being redeemed. If any date fixed for redemption of
Securities 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), with the same force and
effect as if made on such date fixed for redemption. If payment
of the Redemption Price in respect of any Securities is
improperly withheld or refused and not paid either by the
Property Trustee or by the Sponsor as guarantor pursuant to the
relevant Securities Guarantee, Distributions on such Securities
will continue to accumulate from the original redemption date to
the actual date of payment, in which case the actual payment date
will be considered the date fixed for redemption for purposes of
calculating the Redemption Price.
(v) Redemption/Distribution Notices shall be sent by
the Property Trustee on behalf of the Trust to (A) in
respect of the Capital Securities, the Clearing Agency or
its nominee (or any successor Clearing Agency or its
nominee) if the Global Certificates have been issued or, if
Definitive Capital Security Certificates have been issued,
to the Holder thereof, and (B) in respect of the Common
Securities to the Holder thereof.
(vi) Subject to the foregoing and applicable law
(including, without limitation, United States Federal
securities laws and banking laws), provided the acquiror is
not the Holder of the Common Securities or the obligor under
the Indenture, the Sponsor or any of its subsidiaries may at
any time and from time to time purchase outstanding Capital
Securities by tender, in the open market or by private
agreement.
5. Voting Rights - Capital Securities.
(a) Except as provided under Sections 5(b) and 7 and
as otherwise required by law and the Declaration, the Holders of
the Capital Securities will have no voting rights.
(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
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the Debenture Trustee, or executing any trust or power conferred
on such Debenture Trustee with respect to the Debentures, (ii)
waive any past default that is waivable under Section 5.07 of the
Indenture, (iii) exercise any right to rescind or annul a
declaration of acceleration of the maturity of the principal of
the Debentures 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 a majority in liquidation amount
of all outstanding Capital 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 approval of
each Holder of the Capital Securities. The Trustees shall not
revoke any action previously authorized or approved by a vote of
the Holders of the Capital Securities except by subsequent vote
of such Holders. The Property Trustee shall notify each Holder
of Capital Securities of any notice of default with respect to
the Debentures. In addition to obtaining the foregoing approvals
of such Holders of the Capital Securities, prior to taking any of
the foregoing actions, the Trustees shall obtain an opinion of
counsel experienced in such matters to the effect that the Trust
will not be classified as an association taxable as a corporation
for United States Federal income tax purposes on account of such
action.
If an Event of Default under the Declaration has
occurred and is continuing and such event is attributable to the
failure of the Debenture Issuer to pay principal of or premium,
if any, or interest on the Debentures on the date such principal,
premium, if any, or interest is otherwise payable (or in the case
of redemption, on the redemption date), then a Holder of Capital
Securities may directly institute a proceeding for enforcement of
payment to such Holder of the principal of or premium, if any, or
interest on a Like Amount of Debentures (a "Direct Action") on or
after the respective due date specified in the Debentures. In
connection with such Direct Action, the rights of the Common
Securities Holder will be subrogated to the rights of such Holder
of Capital Securities to the extent of any payment made by the
Debenture Issuer to such Holder of Capital Securities in such
Direct Action. Except as provided in the second preceding
sentence, the Holders of Capital Securities will not be able to
exercise directly any other remedy available to the holders of
the Debentures.
Any approval or direction of Holders of Capital
Securities may be given at a separate meeting of Holders of
Capital Securities convened for such purpose, at a meeting of all
of the Holders of Securities in the Trust or pursuant to written
consent. The Property Trustees will cause a notice of any
meeting at which Holders of Capital Securities are entitled to
vote, or of any matter upon which action by written consent of
such
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Holders is to be taken, to be mailed to each Holder of record of
Capital Securities. Each such notice will include a statement setting
forth (i) the date of such meeting or the date by which such action is
to be taken, (ii) a description of any resolution proposed for
adoption at such meeting on which such Holders are entitled to vote or
of such matter upon which written consent is sought and (iii)
instructions for the delivery of proxies or consents.
No vote or consent of the Holders of the Capital
Securities will be required for the Trust to redeem and cancel
Capital Securities or to distribute the Debentures in accordance
with the Declaration and the terms of the Securities.
Notwithstanding that Holders of Capital Securities are
entitled to vote or consent under any of the circumstances
described above, any of the Capital Securities that are owned by
the Sponsor or any Affiliate of the Sponsor shall not be entitled
to vote or consent and shall, for purposes of such vote or
consent, be treated as if they were not outstanding.
6. Voting Rights - Common Securities.
(a) Except as provided under Sections 6(b), 6(c), and
7 as otherwise required by law and the Declaration, the Holders
of the Common Securities will have no voting rights.
(b) Unless a Debenture Event of Default shall have
occurred and be continuing, any Trustee may be removed at any
time by the holder of the Common Securities. If a Debenture
Event of Default 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 Capital Securities. In no event will the holders of
the Capital Securities have the right to vote to appoint, remove
or replace the Administrative Trustees, which voting rights are
vested exclusively in the Sponsor as the holder of the Common
Securities. No resignation or removal of a 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 Declaration.
(c) 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 such Debenture Trustee with respect to the Debentures, (ii)
waive any past default that is waivable under Section 5.07 of the
Indenture, (iii) exercise any right to rescind or annul a
declaration of acceleration of the maturity of the principal of
the Debentures or (iv) consent to any amendment, modification or
termination of the Indenture or the Debentures, where such
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consent shall be required, without, in each case, obtaining the
prior approval of the Holders of a majority in liquidation amount
of all outstanding Common 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 approval of
each Holder of the Common Securities. The Trustees shall not
revoke any action previously authorized or approved by a vote of
the Holders of the Common Securities except by subsequent vote of
such Holders. The Property Trustee shall notify each Holder of
Common Securities of any notice of default with respect to the
Debentures. In addition to obtaining the foregoing approvals of
such Holders of the Common Securities, prior to taking any of the
foregoing actions, the Trustees shall obtain an opinion of
counsel experienced in such matters to the effect that the Trust
will not be classified as an association taxable as a corporation
for United States Federal income tax purposes on account of such
action.
If an Event of Default under the Declaration has
occurred and is continuing and such event is attributable to the
failure of the Debenture Issuer to pay principal of or premium,
if any, or interest on the Debentures on the date such principal,
premium, if any, or interest is otherwise payable (or in the case
of redemption, on the redemption date), then a Holder of Common
Securities may institute a Direct Action for enforcement of
payment to such Holder of the principal of or premium, if any, or
interest on a Like Amount of Debentures on or after the
respective due date specified in the Debentures. In connection
with Direct Action, the rights of the Common Securities Holder
will be subordinated to the rights of such Holder of Capital
Securities to the extent of any payment made by the Debenture
Issuer to such Holder of Common Securities in such Direct Action.
Except as provided in the second preceding sentence, the Holders
of Common Securities will not be able to exercise directly any
other remedy available to the holders of the Debentures.
Any approval or direction of Holders of Common
Securities may be given at a separate meeting of Holders of
Common Securities convened for such purpose, at a meeting of all
of the Holders of Securities in the Trust or pursuant to written
consent. The Administrative Trustees will cause a notice of any
meeting at which Holders of Common Securities are entitled to
vote, or of any matter upon which action by written consent of
such Holders is to be taken, to be mailed to each Holder of
record of Common Securities. Each such notice will include a
statement setting forth (i) the date of such meeting or the date
by which such action is to be taken, (ii) a description of any
resolution proposed for adoption at such meeting on which such
Holders are entitled to vote or of such matter upon which written
consent is sought and (iii) instructions for the delivery of
proxies or consents.
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<PAGE>
No vote or consent of the Holders of the Common
Securities will be required for the Trust to redeem and cancel
Common Securities or to distribute the Debentures in accordance
with the Declaration and the terms of the Securities.
7. Amendments to Declaration and Indenture.
In addition to the requirements set out in Section 12.1
of the Declaration, the Declaration may be amended from time to
time by the Sponsor, the Property Trustee and the Administrative
Trustees, without the consent of the Holders of the Securities
(i) to cure any ambiguity, correct or supplement any provisions
in the Declaration that may be inconsistent with any other
provisions, or to make any other provisions with respect to
matters or questions arising under the Declaration which shall
not be inconsistent with the other provisions of the Declaration,
or (ii) to modify, eliminate or add to any provisions of the
Declaration to such extent as shall be necessary to ensure that
the Trust will be classified for United States Federal income tax
purposes as a grantor trust at all times that any Securities are
outstanding or to ensure that the Trust will not be required to
register as an "Investment Company" under the Investment Company
Act; provided, however, that in the case of clause (i), such
action shall not adversely affect in any material respect the
interests of any Holder of Securities, and any amendments of the
Declaration shall become effective when notice thereof is given
to the holders of the Securities. The Declaration may be amended
by the Trustees and the Sponsor with (i) the consent of Holders
representing a majority in liquidation amount of all outstanding
Securities, 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 affect the Trust's status as a grantor trust for United
States Federal income tax purposes or the Trust's exemption from
status as an Investment Company under the Investment Company Act,
provided that, without the consent of each Holder of Trust
Securities, the Declaration 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 holder of Trust
Securities to institute suit for the enforcement of any such
payment on or after such date.
8. Pro Rata.
A reference in these terms of the Securities to any
payment, distribution or treatment as being "Pro Rata" shall mean
pro rata to each Holder of Securities according to the aggregate
liquidation amount of the Securities held by the relevant Holder
in relation to the aggregate liquidation amount of all Securities
outstanding unless, in relation to a payment, an Event of Default
I-11
<PAGE>
under the Declaration has occurred and is continuing, in which
case any funds available to make such payment shall be paid first
to each Holder of the Capital Securities pro rata according to
the aggregate liquidation amount of Capital Securities held by
the relevant Holder relative to the aggregate liquidation amount
of all Capital Securities outstanding, and only after
satisfaction of all amounts owed to the Holders of the Capital
Securities, to each Holder of Common Securities pro rata
according to the aggregate liquidation amount of Common
Securities held by the relevant Holder relative to the aggregate
liquidation amount of all Common Securities outstanding.
9. Ranking.
The Capital Securities rank pari passu with the Common
Securities and payment thereon shall be made Pro Rata with the
Common Securities, except that, if an Event of Default under the
Declaration occurs and is continuing, no payments in respect of
Distributions on, or payments upon liquidation, redemption or
otherwise with respect to, the Common Securities shall be made
until the Holders of the Capital Securities shall be paid in full
the Distributions, Redemption Price, Liquidation Distribution and
other payments to which they are entitled at such time.
10. Acceptance of Securities Guarantee and Indenture.
Each Holder of Capital Securities and Common
Securities, by the acceptance thereof, agrees to the provisions
of the Capital Securities Guarantee and the Common Securities
Guarantee, respectively, including the subordination provisions
therein and to the provisions of the Indenture.
11. No Preemptive Rights.
The Holders of the Securities shall have no preemptive
rights to subscribe for any additional securities.
12. Miscellaneous.
These terms constitute a part of the Declaration.
The Sponsor will provide a copy of the Declaration, the
Capital Securities Guarantee or the Common Securities Guarantee
(as may be appropriate), the Indenture (including any
supplemental indenture) to a Holder without charge on written
request to the Sponsor at its principal place of business.
I-12
<PAGE>
EXHIBIT A-1
FORM OF CAPITAL SECURITY CERTIFICATE
[FORM OF FACE OF SECURITY]
[IF THIS CAPITAL SECURITY IS A GLOBAL CAPITAL SECURITY,
INSERT: THIS CAPITAL SECURITY IS A GLOBAL CAPITAL SECURITY
WITHIN THE MEANING OF THE DECLARATION HEREINAFTER REFERRED TO AND
IS REGISTERED IN THE NAME OF THE DEPOSITORY TRUST COMPANY (THE
"CLEARING AGENCY") OR A NOMINEE OF THE CLEARING AGENCY. THIS
CAPITAL SECURITY IS EXCHANGEABLE FOR CAPITAL SECURITIES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE CLEARING AGENCY
OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
DECLARATION AND NO TRANSFER OF THIS CAPITAL SECURITY (OTHER THAN
A TRANSFER OF THIS CAPITAL SECURITY AS A WHOLE BY THE CLEARING
AGENCY TO A NOMINEE OF THE CLEARING AGENCY OR BY A NOMINEE OF THE
CLEARING AGENCY TO THE CLEARING AGENCY OR ANOTHER NOMINEE OF THE
CLEARING AGENCY) MAY BE REGISTERED EXCEPT IN LIMITED
CIRCUMSTANCES.
UNLESS THIS CAPITAL SECURITY IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55
WATER STREET, NEW YORK, NEW YORK) TO THE TRUST OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CAPITAL
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 SINCE THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
THIS SECURITY IS NOT A SAVINGS OR DEPOSIT ACCOUNT OR
OTHER OBLIGATION OF A BANK AND IS NOT INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.
A1-1
<PAGE>
Certificate Number Number of Capital Securities
CUSIP NO. __________
Certificate Evidencing Capital Securities
of
BANKBOSTON CAPITAL TRUST III
Floating Rate Capital Securities
(liquidation amount $1,000 per Capital Security)
BANKBOSTON CAPITAL TRUST III, 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 __________ securities of the Trust
representing undivided beneficial interests in the assets of the
Trust designated the Floating Rate Capital Securities
(liquidation amount $1,000 per Capital Security) (the "Capital
Securities"). The Capital 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. The designation, rights, privileges,
restrictions, preferences and other terms and provisions of the
Capital Securities represented hereby are issued and shall in all
respects be subject to the provisions of the Amended and Restated
Declaration of Trust of the Trust dated as of _______, 1997, as
the same may be amended from time to time (the "Declaration"),
including the designation of the terms of the Capital Securities
as set forth in Annex I to the Declaration. Capitalized terms
used but not defined herein shall have the meaning given them in
the Declaration. The Sponsor will provide a copy of the
Declaration, the Capital Securities Guarantee and the Indenture
to a Holder without charge upon written request to the Trust at
its principal place of business.
Upon receipt of this certificate, the Holder is bound
by the Declaration and is entitled to the benefits thereunder and
to the benefits of the Capital Securities Guarantee to the extent
provided therein.
By acceptance, the Holder agrees to treat, for United
States Federal income tax purposes, the Debentures as
indebtedness and the Capital Securities as evidence of indirect
beneficial ownership in the Debentures.
A1-2
<PAGE>
IN WITNESS WHEREOF, the Trust has executed this
certificate this ____ day of __________, ____.
BANKBOSTON CAPITAL TRUST III
By:________________________________
Name:
Administrative Trustee
PROPERTY TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Capital Securities referred to in
the within-mentioned Declaration.
Dated: ,
THE BANK OF NEW YORK,
as Property Trustee
By:
Authorized Signatory
A1-3
<PAGE>
[FORM OF REVERSE OF SECURITY]
Distributions on each Capital Security will be payable
at a rate per annum equal to LIBOR plus ____% (the "Distribution
Rate") of the stated Liquidation Amount of $1,000 per Capital
Security, such rate being the rate of interest payable on the
Debentures to be held by the Property Trustee. LIBOR and the
amount payable in respect of a Distribution for a Distribution
Period will be calculated by the Calculation Agent in the same
manner as LIBOR and the interest payable in respect of each
Interest Period for the Debentures, as set forth in the
Indenture. Distributions in arrears for more than one quarterly
period will bear additional distributions thereon compounded
quarterly at the applicable periodic Distribution Rate (to the
extent permitted by applicable law). The term "Distributions",
as used herein, includes any such additional distributions unless
otherwise stated. A Distribution is payable only to the extent
that payments are made in respect of the Debentures held by the
Property Trustee and to the extent the Property Trustee has funds
on hand legally available therefor.
Distributions on the Capital Securities will be
cumulative, will accumulate from the most recent date to which
Distributions have been paid or, if no Distributions have been
paid, from _______, 1997, to but excluding the related
Distribution Date (as defined herein) and will be payable
quarterly in arrears on _______, _______, _______, and _______ of
each year, commencing on _______, 1997 (each, a "Distribution
Date"), except as otherwise described below and in the
Declaration. The amount of Distributions payable for any
Distribution Period will be computed on the basis of the actual
number of days elapsed in such period and a year of 360 days.
"Distribution Period" means the period from and including a
Distribution Date (or _______, 1997, in the case of the first
Distribution Period) to but excluding the next Distribution Date.
If a Distribution Date is not a Business Day, then such
Distribution Date and the first day of the next succeeding
Distribution Period will be the next succeeding Business Day,
except if such Business Day is in the next succeeding calendar
month, such Distribution Date and the first day of the next
succeeding Distribution Period will be the immediately preceding
Business Day. As long as no Event of Default has occurred and is
continuing under the Indenture, the Debenture Issuer has the
right under the Indenture to defer payments of interest by
extending the interest payment period at any time and from time
to time on the Debentures for a period not exceeding 20
consecutive quarterly periods, including the first such quarterly
period during such period (each an "Extension Period"), during
which Extension Period no interest shall be due and payable on
the Debentures, provided that no Extension Period shall extend
beyond the Maturity Date of the Debentures. As a consequence of
such deferral, Distributions will also be deferred. Despite such
deferral, quarterly Distributions will con-
A1-4
<PAGE>
tinue to accumulate with additional interest thereon (to the extent
permitted by applicable law but not at a rate greater than the rate at
which interest is then accruing on the Debentures) at the Distribution
Rate then in effect compounded quarterly during any such Extension
Period. At the end of the Extension Period, all accrued and unpaid
Distributions (but only to the extent payments are made in respect of
the Debentures held by the Property Trustee and to the extent the
Property Trustee has funds available therefor) will be payable to the
Holders as they appear on the books and records of the Trust on the
first record date after the end of the Extension Period. Prior to the
termination of any such Extension Period, the Debenture Issuer may
further defer payments of interest by further extending such Extension
Period; provided that such Extension Period, together with all such
previous and further extensions within such Extension Period, may not
exceed 20 consecutive quarterly periods, including the first quarterly
period during such Extension Period, or extend beyond the Maturity
Date of the Debentures. Upon the termination of any Extension Period
and the payment of all amounts then due, the Debenture Issuer may
commence a new Extension Period, subject to the above requirements.
Subject to the prior approval of the Federal Reserve
Board if such approval is then required under applicable law or
capital guidelines or policies of the Federal Reserve Board and
to certain other conditions set forth in the Declaration and the
Indenture, the Property Trustee may, at the direction of the
Sponsor, at any time liquidate the Trust and cause the Debentures
to be distributed to the holders of the Securities in liquidation
of the Trust or, simultaneous with any redemption of the
Debentures, cause a Like Amount of the Securities to be redeemed
by the Trust.
The Capital Securities shall be redeemable as provided
in the Declaration.
A1-5
<PAGE>
_____________________
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this
Capital Security Certificate to:
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
(Insert assignee's social security or tax identification number)
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
(Insert address and zip code of assignee)
and irrevocably appoints
_________________________________________________________________
_________________________________________________________________
___________________________________________________________ agent
to transfer this Capital 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
Capital Security Certificate)
Signature Guarantee*: ___________________________________
___________________________________
* Signature must be guaranteed by an "eligible guarantor
institution" that is a bank, stockbroker, savings and loan
association or credit union meeting the requirements of the
Registrar, which requirements include membership or
participation in the Securities Transfer Agents Medallion
Program ("STAMP") or such other "signature guarantee
program" as may be determined by the Registrar in addition
to, or in substitution for, STAMP, all in accordance with
the Securities and Exchange Act of 1934, as amended.
A1-6
<PAGE>
EXHIBIT A-2
FORM OF COMMON SECURITY CERTIFICATE
THIS CERTIFICATE IS NOT TRANSFERABLE
Certificate Number Number of Common Securities
Certificate Evidencing Common Securities
of
BankBoston Capital Trust III
Floating Rate Common Securities
(liquidation amount $1,000 per Common Security)
BANKBOSTON CAPITAL TRUST III, a statutory business
trust formed under the laws of the State of Delaware (the
"Trust"), hereby certifies that BankBoston Corporation (the
"Holder") is the registered owner of __________ common securities
of the Trust representing undivided beneficial interests in the
assets of the Trust designated the Floating Rate Common
Securities (liquidation amount $1,000 per Common Security) (the
"Common Securities"). The Common Securities are not
transferable. The designation, rights, privileges, restrictions,
preferences and other terms and provisions of the Common
Securities represented hereby are issued and shall in all
respects be subject to the provisions of the Amended and Restated
Declaration of Trust of the Trust dated as of _______, 1997, as
the same may be amended from time to time (the "Declaration"),
including the designation of the terms of the Common Securities
as set forth in Annex I to the Declaration. Capitalized terms
used but not defined herein shall have the meaning given them in
the Declaration. The Sponsor will provide a copy of the
Declaration, the Common Securities Guarantee and the Indenture
(including any supplemental indenture) to a Holder without charge
upon written request to the Sponsor at its principal place of
business.
Upon receipt of this certificate, the Sponsor is bound
by the Declaration and is entitled to the benefits thereunder and
to the benefits of the Common Securities Guarantee to the extent
provided therein.
By acceptance, the Holder agrees to treat, for United
States Federal income tax purposes, the Debentures as
indebtedness and the Common Securities as evidence of indirect
beneficial ownership in the Debentures.
A2-1
<PAGE>
THIS SECURITY IS NOT A SAVINGS OR DEPOSIT ACCOUNT OR
OTHER OBLIGATION OF A BANK AND IS NOT INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.
IN WITNESS WHEREOF, the Trust has executed this
certificate this ___ day of , ____.
BANKBOSTON CAPITAL TRUST III
By:________________________________
Name:
Administrative Trustee
A2-2
<PAGE>
[FORM OF REVERSE OF SECURITY]
Distributions on each Common Security will be payable
at a rate per annum equal to LIBOR plus ____% (the "Distribution
Rate") of the stated Liquidation Amount of $1,000 per Common
Security, such rate being the rate of interest payable on the
Debentures to be held by the Property Trustee. LIBOR and the
amount payable in respect of a Distribution for a Distribution
Period will be calculated by the Calculation Agent in the same
manner as LIBOR and the interest payable in respect of each
Interest Period for the Debentures, as set forth in the
Indenture. Distributions in arrears for more than one quarterly
period will bear additional distributions thereon compounded
quarterly at the applicable periodic Distribution Rate (to the
extent permitted by applicable law). The term "Distributions",
as used herein, includes any such additional distributions unless
otherwise stated. A Distribution is payable only to the extent
that payments are made in respect of the Debentures held by the
Property Trustee and to the extent the Property Trustee has funds
on hand legally available therefor.
Distributions on the Common Securities will be
cumulative, will accumulate from the most recent date to which
Distributions have been paid or, if no Distributions have been
paid, from _______, 1997, to but excluding the related
Distribution Date (as defined herein) and will be payable
quarterly in arrears on _______, _______, _______, and _______ of
each year, commencing on _______, 1997 (each, a "Distribution
Date"), except as otherwise described below and in the
Declaration. The amount of Distributions payable for any
Distribution Period will be computed on the basis of the actual
number of days elapsed in such period and a year of 360 days.
"Distribution Period" means the period from and including a
Distribution Date (or _______, 1997, in the case of the first
Distribution Period) to but excluding the next Distribution Date.
If a Distribution Date is not a Business Day, then such
Distribution Date and the first day of the next succeeding
Distribution Period will be the next succeeding Business Day,
except if such Business Day is in the next succeeding calendar
month, such Distribution Date and the first day of the next
succeeding Distribution Period will be the immediately preceding
Business Day. As long as no Event of Default has occurred and is
continuing under the Indenture, the Debenture Issuer has the
right under the Indenture to defer payments of interest by
extending the interest payment period at any time and from time
to time on the Debentures for a period not exceeding 20
consecutive quarterly periods, including the first such quarterly
period during such period (each an "Extension Period"), during
which Extension Period no interest shall be due and payable on
the Debentures, provided that no Extension Period shall extend
beyond the Maturity Date of the Debentures. As a consequence of
such deferral, Distributions will also be deferred. Despite such
deferral, quarterly Distributions will continue to accumulate
with additional interest thereon (to the extent permitted by
applicable law but not at a rate greater than the rate at which
interest is then accruing on the Debentures) at
A2-3
<PAGE>
the Distribution Rate then in effect compounded quarterly during any
such Extension Period. At the end of the Extension Period, all accrued
and unpaid Distributions (but only to the extent payments are made in
respect of the Debentures held by the Property Trustee and to the
extent the Property Trustee has funds available therefor) will be
payable to the Holders as they appear on the books and records of the
Trust on the first record date after the end of the Extension Period.
Prior to the termination of any such Extension Period, the Debenture
Issuer may further defer payments of interest by further extending
such Extension Period; provided that such Extension Period, together
with all such previous and further extensions within such Extension
Period, may not exceed 20 consecutive quarterly periods, including the
first quarterly period during such Extension Period, or extend beyond
the Maturity Date of the Debentures. Upon the termination of any
Extension Period and the payment of all amounts then due, the
Debenture Issuer may commence a new Extension Period, subject to the
above requirements.
Subject to the prior approval of the Federal Reserve
Board if such approval is then required under applicable law or
capital guidelines or policies of the Federal Reserve Board and
to certain other conditions set forth in the Declaration and the
Indenture, the Property Trustee may, at the direction of the
Sponsor, at any time liquidate the Trust and cause the Debentures
to be distributed to the holders to the Securities in liquidation
of the Trust or, simultaneous with any redemption of the
Debentures, cause a Like Amount of the Securities to be redeemed
by the Trust.
The Common Securities shall be redeemable as provided
in the Declaration.
A2-4
<PAGE>
EXHIBIT 4.7
====================================
CAPITAL SECURITIES GUARANTEE AGREEMENT
BankBoston Corporation
Dated as of ______, 1997
====================================
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation . . . . . . 2
ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application . . . . . 6
SECTION 2.2 Lists of Holders of Securities . . . . . . 6
SECTION 2.3 Reports by the Capital Securities Guaran-
tee Trustee . . . . . . . . . . . . . . . 6
SECTION 2.4 Periodic Reports to Capital Securities
Guarantee Trustee . . . . . . . . . . . . 7
SECTION 2.5 Evidence of Compliance with Conditions
Precedent . . . . . . . . . . . . . . . . 7
SECTION 2.6 Events of Default; Waiver . . . . . . . . 7
SECTION 2.7 Event of Default; Notice . . . . . . . . . 7
SECTION 2.8 Conflicting Interests . . . . . . . . . . 8
ARTICLE III
POWERS, DUTIES AND RIGHTS OF
CAPITAL SECURITIES GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Capital Securi-
ties Guarantee Trustee . . . . . . . . . . 8
SECTION 3.2 Certain Rights of Capital Securities
Guarantee Trustee . . . . . . . . . . . . 10
SECTION 3.3. Not Responsible for Recitals or Issuance
of Capital Securities Guarantee . . . . . 13
ARTICLE IV
CAPITAL SECURITIES GUARANTEE TRUSTEE
SECTION 4.1 Capital Securities Guarantee Trustee;
Eligibility . . . . . . . . . . . . . . . 13
SECTION 4.2 Appointment, Removal and Resignation of
Capital Securities Guarantee Trustee . . . 14
ARTICLE V
GUARANTEE
SECTION 5.1 Guarantee . . . . . . . . . . . . . . . . 15
SECTION 5.2 Waiver of Notice and Demand . . . . . . . 15
SECTION 5.3 Obligations Not Affected . . . . . . . . . 15
SECTION 5.4 Rights of Holders . . . . . . . . . . . . 16
SECTION 5.5 Guarantee of Payment . . . . . . . . . . . 17
<PAGE>
Page
SECTION 5.6 Subrogation . . . . . . . . . . . . . . . 17
SECTION 5.7 Independent Obligations . . . . . . . . . 17
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions . . . . . . . . 17
SECTION 6.2 Ranking . . . . . . . . . . . . . . . . . 18
ARTICLE VII
TERMINATION
SECTION 7.1 Termination . . . . . . . . . . . . . . . 19
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 Exculpation . . . . . . . . . . . . . . . 19
SECTION 8.2 Indemnification . . . . . . . . . . . . . 19
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns . . . . . . . . . . 20
SECTION 9.2 Amendments . . . . . . . . . . . . . . . . 20
SECTION 9.3 Notices . . . . . . . . . . . . . . . . . 20
SECTION 9.4 Benefit . . . . . . . . . . . . . . . . . 21
SECTION 9.5 Governing Law . . . . . . . . . . . . . . 22
ii
<PAGE>
CAPITAL SECURITIES GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT (the "Capital Securities
Guarantee"), dated as of ______, 1997, is executed and delivered
by BankBoston Corporation, a Massachusetts corporation (the
"Guarantor"), and The Bank of New York, a New York banking
corporation, as trustee (the "Capital Securities Guarantee
Trustee"), for the benefit of the Holders (as defined herein)
from time to time of the Capital Securities (as defined herein)
of BankBoston Capital Trust III, a statutory business trust
formed under the laws of the State of Delaware (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Declara-
tion of Trust (the "Declaration"), dated as of ______, 1997,
among the trustees of the Issuer, the Guarantor, as sponsor, and
the holders from time to time of undivided beneficial interests
in the assets of the Issuer, the Issuer is issuing on the date
hereof 250,000 capital securities, having an aggregate liquida-
tion amount of $250,000,000, such capital securities being
designated the Floating Rate Capital Securities (collectively,
the "Capital Securities").
WHEREAS, as incentive for the Holders to purchase the
Capital Securities, the Guarantor desires irrevocably and uncon-
ditionally to agree, to the extent set forth in this Capital
Securities Guarantee, to pay to the Holders of the Capital
Securities the Guarantee Payments (as defined below). The
Guarantor agrees to make certain other payments on the terms and
conditions set forth herein.
WHEREAS, the Guarantor is executing and delivering a
guarantee agreement (the "Common Securities Guarantee"), with
substantially identical terms to this Capital Securities Guaran-
tee, for the benefit of the holders of the Common Securities (as
defined herein), except that if an Event of Default (as defined
in the Declaration) has occurred and is continuing, the rights of
holders of the Common Securities to receive Guarantee Payments
under the Common Securities Guarantee are subordinated, to the
extent and in the manner set forth in the Common Securities
Guarantee, to the rights of holders of Capital Securities to
receive Guarantee Payments under this Capital Securities Guaran-
tee.
NOW, THEREFORE, in consideration of the purchase by
each Holder of Capital Securities, which purchase the Guarantor
hereby acknowledges shall benefit the Guarantor, the Guarantor
executes and delivers this Capital Securities Guarantee for the
benefit of the Holders.
<PAGE>
ARTICLE I
DEFINITIONS AND INTERPRETATION
SECTION 1.1 Definitions and Interpretation
In this Capital Securities Guarantee, unless the
context otherwise requires:
(a) Capitalized terms used in this Capital Securities
Guarantee but not defined in the preamble above
have the respective meanings assigned to them in
this Section 1.1;
(b) Terms defined in the Declaration as at the date of
execution of this Capital Securities Guarantee
have the same meaning when used in this Capital
Securities Guarantee unless otherwise defined in
this Capital Securities Guarantee;
(c) a term defined anywhere in this Capital Securities
Guarantee has the same meaning throughout;
(d) all references to "the Capital Securities Guaran-
tee" or "this Capital Securities Guarantee" are to
this Capital Securities Guarantee as modified,
supplemented or amended from time to time;
(e) all references in this Capital Securities Guaran-
tee to Articles and Sections are to Articles and
Sections of this Capital Securities Guarantee,
unless otherwise specified;
(f) a term defined in the Trust Indenture Act has the
same meaning when used in this Capital Securities
Guarantee, unless otherwise defined in this Capi-
tal Securities Guarantee or unless the context
otherwise requires; and
(g) a reference to the singular includes the plural
and vice versa.
"Affiliate" has the same meaning as given to that term
in Rule 405 under the Securities Act of 1933, as amended, or any
successor rule thereunder.
"Business Day" means any day other than a Saturday or a
Sunday, or a day on which banking institutions in The City of New
York or Boston, Massachusetts are authorized or required by law
or executive order to close.
"Capital Securities Guarantee Trustee" means The Bank
of New York, a New York banking corporation, until a Successor
2
<PAGE>
Capital Securities Guarantee Trustee has been appointed and has
accepted such appointment pursuant to the terms of this Capital
Securities Guarantee and thereafter means each such Successor
Capital Securities Guarantee Trustee.
"Common Securities" means the securities representing
common undivided beneficial interests in the assets of the
Issuer.
"Corporate Trust Office" means the office of the
Capital Securities Guarantee Trustee at which the corporate trust
business of the Capital Securities Guarantee Trustee shall, at
any particular time, be principally administered, which office at
the date of execution of this Agreement is located at 101 Barclay
Street, 21 West, New York, New York 10286.
"Covered Person" means any Holder or beneficial owner
of Capital Securities.
"Debentures" means the series of junior subordinated
debt securities of the Guarantor designated the Floating Rate
Junior Subordinated Deferrable Interest Debentures due ______,
2027 held by the Property Trustee (as defined in the Declaration)
of the Issuer.
"Event of Default" means a default by the Guarantor on
any of its payment or other obligations under this Capital
Securities Guarantee.
"Guarantee Payments" means the following payments or
distributions, without duplication, with respect to the Capital
Securities, to the extent not paid or made by the Issuer: (i)
any accumulated and unpaid Distributions (as defined in the
Declaration) that are required to be paid on such Capital Securi-
ties, to the extent the Issuer has funds on hand legally avail-
able therefor at such time, (ii) the redemption price, including
all accumulated and unpaid Distributions to the date of redemp-
tion (the "Redemption Price"), to the extent the Issuer has funds
on hand legally available therefor at such time, with respect to
any Capital Securities called for redemption by the Issuer, and
(iii) upon a voluntary or involuntary termination and liquidation
of the Issuer (other than in connection with the distribution of
Debentures to the Holders in exchange for Capital Securities as
provided in the Declaration), the lesser of (a) the aggregate of
the liquidation amount and all accumulated and unpaid Distribu-
tions on the Capital Securities to the date of payment, to the
extent the Issuer has funds on hand legally available therefor at
such time, and (b) the amount of assets of the Issuer remaining
available for distribution to Holders in liquidation of the
Issuer (in either case, the "Liquidation Distribution"). If an
Event of Default has occurred and is continuing, no Guarantee
Payments under the Common Securities Guarantee with respect to
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the Common Securities or any guarantee payment under any Other
Common Securities Guarantees shall be made until the Holders of
Capital Securities shall be paid in full the Guarantee Payments
to which they are entitled under this Capital Securities Guaran-
tee.
"Holder" shall mean any holder, as registered on the
books and records of the Issuer, of any Capital Securities;
provided, however, that, in determining whether the holders of
the requisite percentage of Capital Securities have given any
request, notice, consent or waiver hereunder, "Holder" shall not
include the Guarantor or any Affiliate of the Guarantor.
"Indemnified Person" means the Capital Securities
Guarantee Trustee, any Affiliate of the Capital Securities
Guarantee Trustee, or any officers, directors, shareholders,
members, partners, employees, representatives, nominees, custodi-
ans or agents of the Capital Securities Guarantee Trustee.
"Indenture" means the Indenture dated as of ______,
1997, among the Guarantor (the "Debenture Issuer") and The Bank
of New York, as trustee, pursuant to which the Debentures are to
be issued to the Property Trustee of the Issuer.
"Majority in liquidation amount of the Capital Securi-
ties" means, except as provided by the Trust Indenture Act, a
vote by Holder(s) of Capital Securities, voting separately as a
class, of more than 50% of the aggregate liquidation amount
(including the amount payable on redemption, liquidation or
otherwise, plus accumulated and unpaid Distributions to the date
upon which the voting percentages are determined) of all Capital
Securities.
"Officers' Certificate" means, with respect to any
person, a certificate signed by the Chairman, a Vice Chairman,
the Chief Executive Officer, the President, a Vice President, the
Comptroller, the Executive Director, Global Treasury, the Clerk
or an Assistant Clerk, the Secretary or an Assistant Secretary of
the Guarantor. Any Officers' Certificate delivered with respect
to compliance with a condition or covenant provided for in this
Capital Securities Guarantee 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 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
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(c) a statement as to whether, in the opinion of each
such officer, such condition or covenant has been complied
with.
"Other Common Securities Guarantees" shall have the
same meaning as "Other Guarantees" in the Common Securities
Guarantee.
"Other Debentures" means all junior subordinated
debentures issued by the Guarantor from time to time and sold to
trusts established by the Guarantor, in each case similar to the
Issuer.
"Other Guarantees" means all guarantees issued by the
Guarantor with respect to capital securities similar to the
Capital Securities issued by other trusts established by the
Guarantor, in each case similar to the Issuer.
"Person" means a legal person, including any individu-
al, corporation, estate, partnership, joint venture, association,
joint stock company, limited liability company, trust, unincorpo-
rated association, or government or any agency or political
subdivision thereof, or any other entity of whatever nature.
"Responsible Officer" means, with respect to the
Capital Securities Guarantee Trustee, any officer within the
Corporate Trust Office of the Capital Securities Guarantee
Trustee, including any vice president, any assistant vice presi-
dent, any assistant secretary, any assistant treasurer or other
officer of the Corporate Trust Office of the Capital Securities
Guarantee Trustee customarily performing functions similar to
those performed by any of the above designated officers 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.
"Successor Capital Securities Guarantee Trustee" means
a successor Capital Securities Guarantee Trustee possessing the
qualifications to act as Capital Securities Guarantee Trustee
under Section 4.1.
"Trust Indenture Act" means the Trust Indenture Act of
1939, as amended.
"Trust Securities" means the Common Securities and the
Capital Securities, collectively.
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ARTICLE II
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application
(a) This Capital Securities Guarantee is subject to
the provisions of the Trust Indenture Act that are required to be
part of this Capital Securities Guarantee and shall, to the
extent applicable, be governed by such provisions.
(b) If and to the extent that any provision of this
Capital Securities Guarantee limits, qualifies or conflicts with
the duties imposed by Section 310 to 317, inclusive, of the Trust
Indenture Act, such imposed duties shall control.
SECTION 2.2 Lists of Holders of Securities
(a) The Guarantor shall provide the Capital Securities
Guarantee Trustee (unless the Capital Securities Guarantee
Trustee is otherwise the registrar of the Capital Securities)
with a list, in such form as the Capital Securities Guarantee
Trustee may reasonably require, of the names and addresses of the
Holders of the Capital Securities ("List of Holders"), (i) within
one Business Day after November 15 and May 15 of each year, and
(ii) at any other time within 30 days of receipt by the Guarantor
of a written request for a List of Holders as of a date no more
than 14 days before such List of Holders is given to the Capital
Securities Guarantee Trustee, provided that the Guarantor shall
not be obligated to provide such List of Holders at any time the
List of Holders does not differ from the most recent List of
Holders given to the Capital Securities Guarantee Trustee by the
Guarantor. The Capital Securities Guarantee Trustee may destroy
any List of Holders previously given to it on receipt of a new
List of Holders.
(b) The Capital Securities Guarantee Trustee shall
comply with its obligations under Sections 311(a), 311(b) and
Section 312(b) of the Trust Indenture Act.
SECTION 2.3 Reports by the Capital Securities Guarantee Trustee
Within 60 days after December 15 of each year, commenc-
ing December 15, 1997, the Capital Securities Guarantee Trustee
shall provide to the Holders of the Capital Securities 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 Capital Securities Guarantee
Trustee shall also comply with the requirements of Section 313(d)
of the Trust Indenture Act.
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SECTION 2.4 Periodic Reports to Capital Securities Guarantee
Trustee
The Guarantor shall provide to the Capital Securities
Guarantee Trustee such documents, reports and information as
required by Section 314 (if any) 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 re-
quired by Section 314 of the Trust Indenture Act. Delivery of
such reports, information and documents to the Capital Securities
Guarantee Trustee is for informational purposes only and the
Capital Securities Guarantee Trustee's receipt of such shall not
constitute constructive notice of any information contained
therein or determinable from information contained therein,
including the Guarantor's compliance with any of its covenants
hereunder (as to which the Capital Securities Guarantee Trustee
is entitled to rely exclusively on Officers' Certificates).
SECTION 2.5 Evidence of Compliance with Conditions Precedent
The Guarantor shall provide to the Capital Securities
Guarantee Trustee such evidence of compliance with any conditions
precedent, if any, provided for in this Capital Securities
Guarantee 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.
SECTION 2.6 Events of Default; Waiver
The Holders of a Majority in liquidation amount of
Capital Securities may, by vote, on behalf of the Holders of all
of the Capital Securities, 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
Capital Securities Guarantee, but no such waiver shall extend to
any subsequent or other default or Event of Default or impair any
right consequent thereon.
SECTION 2.7 Event of Default; Notice
(a) The Capital Securities Guarantee Trustee shall,
within 90 days after the occurrence of a default with respect to
this Capital Securities Guarantee, mail by first class postage
prepaid, to all Holders of the Capital Securities, notices of all
defaults actually known to a Responsible Officer of the Capital
Securities Guarantee Trustee, unless such defaults have been
cured before the giving of such notice, provided, that, except in
the case of default in the payment of any Guarantee Payment, the
Capital Securities Guarantee Trustee shall be protected in
withholding such notice if and so long as the board of directors,
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the executive committee, or a trust committee of directors and/or
Responsible Officers of the Capital Securities Guarantee Trustee
in good faith determines that the withholding of such notice is
in the interests of the holders of the Capital Securities.
(b) The Capital Securities Guarantee Trustee shall not
be deemed to have knowledge of any Event of Default unless the
Capital Securities Guarantee Trustee shall have received written
notice, or a Responsible Officer of the Capital Securities
Guarantee Trustee charged with the administration of the Declara-
tion shall have obtained actual knowledge, of such Event of
Default.
SECTION 2.8 Conflicting Interests
The Declaration shall be deemed to be specifically
described in this Capital Securities Guarantee 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
CAPITAL SECURITIES GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of the Capital Securities Guar-
antee Trustee
(a) This Capital Securities Guarantee shall be held by
the Capital Securities Guarantee Trustee for the benefit of the
Holders of the Capital Securities, and the Capital Securities
Guarantee Trustee shall not transfer this Capital Securities
Guarantee to any Person except a Holder of Capital Securities
exercising his or her rights pursuant to Section 5.4(b) or to a
Successor Capital Securities Guarantee Trustee on acceptance by
such Successor Capital Securities Guarantee Trustee of its
appointment to act as Successor Capital Securities Guarantee
Trustee. The right, title and interest of the Capital Securities
Guarantee Trustee shall automatically vest in any Successor
Capital Securities Guarantee Trustee, and such vesting and
succession of title shall be effective whether or not conveyanc-
ing documents have been executed and delivered pursuant to the
appointment of such Successor Capital Securities Guarantee
Trustee.
(b) If an Event of Default actually known to a Respon-
sible Officer of the Capital Securities Guarantee Trustee has
occurred and is continuing, the Capital Securities Guarantee
Trustee shall enforce this Capital Securities Guarantee for the
benefit of the Holders of the Capital Securities.
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(c) The Capital Securities 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
Capital Securities Guarantee, and no implied covenants shall be
read into this Capital Securities Guarantee against the Capital
Securities Guarantee Trustee. In case an Event of Default has
occurred (that has not been cured or waived pursuant to Section
2.6) and is actually known to a Responsible Officer of the
Capital Securities Guarantee Trustee, the Capital Securities
Guarantee Trustee shall exercise such of the rights and powers
vested in it by this Capital Securities Guarantee, and use 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 Capital Securities Guarantee
shall be construed to relieve the Capital Securities 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 De-
fault that may have occurred:
(A) the duties and obligations of the Capital
Securities Guarantee Trustee shall be determined solely
by the express provisions of this Capital Securities
Guarantee, and the Capital Securities Guarantee Trustee
shall not be liable except for the performance of such
duties and obligations as are specifically set forth in
this Capital Securities Guarantee, and no implied
covenants or obligations shall be read into this Capi-
tal Securities Guarantee against the Capital Securities
Guarantee Trustee; and
(B) in the absence of bad faith on the part of
the Capital Securities Guarantee Trustee, the Capital
Securities 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 Capital Securities Guaran-
tee Trustee and conforming to the requirements of this
Capital Securities Guarantee; but in the case of any
such certificates or opinions that by any provision
hereof are specifically required to be furnished to the
Capital Securities Guarantee Trustee, the Capital
Securities Guarantee Trustee shall be under a duty to
examine the same to determine whether or not they
conform to the requirements of this Capital Securities
Guarantee;
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(ii) the Capital Securities Guarantee Trustee shall not
be liable for any error of judgment made in good faith by a
Responsible Officer of the Capital Securities Guarantee
Trustee, unless it shall be proved that the Capital Securi-
ties Guarantee Trustee was negligent in ascertaining the
pertinent facts upon which such judgment was made;
(iii) the Capital Securities 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 direc-
tion of the Holders of a Majority in liquidation amount of
the Capital Securities relating to the time, method and
place of conducting any proceeding for any remedy available
to the Capital Securities Guarantee Trustee, or exercising
any trust or power conferred upon the Capital Securities
Guarantee Trustee under this Capital Securities Guarantee;
and
(iv) no provision of this Capital Securities Guarantee
shall require the Capital Securities 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
Capital Securities 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 Capital Securities Guarantee or indemnity, reasonably
satisfactory to the Capital Securities Guarantee Trustee,
against such risk or liability is not reasonably assured to
it.
SECTION 3.2 Certain Rights of Capital Securities Guarantee
Trustee
(a) Subject to the provisions of Section 3.1:
(i) The Capital Securities Guarantee Trustee may
conclusively 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 believed
by it to be genuine and to have been signed, sent or pre-
sented by the proper party or parties.
(ii) Any direction or act of the Guarantor contemplat-
ed by this Capital Securities Guarantee may be sufficiently
evidenced by an Officers' Certificate.
(iii) Whenever, in the administration of this Capital
Securities Guarantee, the Capital Securities Guarantee
Trustee shall deem it desirable that a matter be proved or
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established before taking, suffering or omitting any action
hereunder, the Capital Securities Guarantee Trustee (unless
other evidence is herein specifically prescribed) may, in
the absence of bad faith on its part, request and conclu-
sively rely upon an Officers' Certificate which, upon re-
ceipt of such request, shall be promptly delivered by the
Guarantor.
(iv) The Capital Securities Guarantee Trustee shall
have no duty to see to any recording, filing or registration
of any instrument (or any rerecording, refiling or registra-
tion thereof).
(v) The Capital Securities Guarantee Trustee may
consult with counsel of its selection, and the advice or
opinion of such counsel with respect to legal matters 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 accordance with such advice or opinion.
Such counsel may be counsel to the Guarantor or any of its
Affiliates and may include any of its employees. The Capi-
tal Securities Guarantee Trustee shall have the right at any
time to seek instructions concerning the administration of
this Capital Securities Guarantee from any court of compe-
tent jurisdiction.
(vi) The Capital Securities Guarantee Trustee shall be
under no obligation to exercise any of the rights or powers
vested in it by this Capital Securities Guarantee at the
request or direction of any Holder, unless such Holder shall
have provided to the Capital Securities Guarantee Trustee
such security and indemnity, reasonably satisfactory to the
Capital Securities Guarantee Trustee, against the costs,
expenses (including attorneys' fees and expenses and the
expenses of the Capital Securities Guarantee Trustee's
agents, nominees or custodians) and liabilities that might
be incurred by it in complying with such request or direc-
tion, including such reasonable advances as may be requested
by the Capital Securities Guarantee Trustee; provided that,
nothing contained in this Section 3.2(a)(vi) shall be taken
to relieve the Capital Securities Guarantee Trustee, upon
the occurrence of an Event of Default, of its obligation to
exercise the rights and powers vested in it by this Capital
Securities Guarantee.
(vii) The Capital Securities 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 Capital
Securities Guarantee Trustee, in its discretion, may make
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such further inquiry or investigation into such facts or
matters as it may see fit.
(viii) The Capital Securities Guarantee Trustee may
execute any of the trusts or powers hereunder or perform any
duties hereunder either directly or by or through agents,
nominees, custodians or attorneys, and the Capital Securi-
ties Guarantee Trustee shall not be responsible for any
misconduct or negligence on the part of any agent or attor-
ney appointed with due care by it hereunder.
(ix) Any action taken by the Capital Securities Guar-
antee Trustee or its agents hereunder shall bind the Holders
of the Capital Securities, and the signature of the Capital
Securities Guarantee Trustee or its agents alone shall be
sufficient and effective to perform any such action. No
third party shall be required to inquire as to the authority
of the Capital Securities Guarantee Trustee to so act or as
to its compliance with any of the terms and provisions of
this Capital Securities Guarantee, both of which shall be
conclusively evidenced by the Capital Securities Guarantee
Trustee's or its agent's taking such action.
(x) Whenever in the administration of this Capital
Securities Guarantee the Capital Securities Guarantee Trust-
ee shall deem it desirable to receive instructions with
respect to enforcing any remedy or right or taking any other
action hereunder, the Capital Securities Guarantee Trustee
(i) may request instructions from the Holders of a Majority
in liquidation amount of the Capital Securities, (ii) may
refrain from enforcing such remedy or right or taking such
other action until such instructions are received, and (iii)
shall be protected in conclusively relying on or acting in
accordance with such instructions.
(xi) The Capital Securities Guarantee Trustee shall
not be liable for any action taken, suffered, or omitted to
be taken by it in good faith, without negligence, and rea-
sonably believed by it to be authorized or within the dis-
cretion or rights or powers conferred upon it by this Capi-
tal Securities Guarantee.
(b) No provision of this Capital Securities Guarantee
shall be deemed to impose any duty or obligation on the Capital
Securities 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 Capital Securities 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
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Capital Securities Guarantee Trustee shall be construed to be a
duty.
SECTION 3.3. Not Responsible for Recitals or Issuance of Capi-
tal Securities Guarantee
The recitals contained in this Capital Securities
Guarantee shall be taken as the statements of the Guarantor, and
the Capital Securities Guarantee Trustee does not assume any
responsibility for their correctness. The Capital Securities
Guarantee Trustee makes no representation as to the validity or
sufficiency of this Capital Securities Guarantee.
ARTICLE IV
CAPITAL SECURITIES GUARANTEE TRUSTEE
SECTION 4.1 Capital Securities Guarantee Trustee; Eligibility
(a) There shall at all times be a Capital Securities
Guarantee Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business
under the laws of the United States of America or any State
or Territory thereof or of the District of Columbia, or a
corporation or Person permitted by the Securities and Ex-
change Commission to act as an institutional trustee under
the Trust Indenture Act, authorized under such laws to
exercise corporate trust powers, having a combined capital
and surplus of at least 50 million U.S. dollars
($50,000,000), and subject to supervision or examination by
Federal, State, Territorial or District of Columbia authori-
ty. If such corporation publishes reports of condition at
least annually, pursuant to law or to the requirements of
the supervising or examining authority referred to above,
then, for the purposes of this Section 4.1(a)(ii), 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 Capital Securities Guarantee
Trustee shall cease to be eligible to so act under Section
4.1(a), the Capital Securities Guarantee Trustee shall immediate-
ly resign in the manner and with the effect set out in Section
4.2(c).
(c) If the Capital Securities Guarantee Trustee has or
shall acquire any "conflicting interest" within the meaning of
Section 310(b) of the Trust Indenture Act, the Capital Securities
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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 Capital
Securities Guarantee Trustee
(a) Subject to Section 4.2(b), the Capital Securities
Guarantee Trustee may be appointed or removed without cause at
any time by the Guarantor except during an Event of Default.
(b) The Capital Securities Guarantee Trustee shall not
be removed in accordance with Section 4.2(a) until a Successor
Capital Securities Guarantee Trustee has been appointed and has
accepted such appointment by written instrument executed by such
Successor Capital Securities Guarantee Trustee and delivered to
the Guarantor.
(c) The Capital Securities Guarantee Trustee shall
hold office until a Successor Capital Securities Guarantee
Trustee shall have been appointed or until its removal or resig-
nation. The Capital Securities Guarantee Trustee may resign from
office (without need for prior or subsequent accounting) by an
instrument in writing executed by the Capital Securities Guaran-
tee Trustee and delivered to the Guarantor, which resignation
shall not take effect until a Successor Capital Securities
Guarantee Trustee has been appointed and has accepted such
appointment by instrument in writing executed by such Successor
Capital Securities Guarantee Trustee and delivered to the Guaran-
tor and the resigning Capital Securities Guarantee Trustee.
(d) If no Successor Capital Securities Guarantee
Trustee shall have been appointed and accepted appointment as
provided in this Section 4.2 within 60 days after delivery of an
instrument of removal or resignation, the Capital Securities
Guarantee Trustee resigning or being removed may petition any
court of competent jurisdiction for appointment of a Successor
Capital Securities Guarantee Trustee. Such court may thereupon,
after prescribing such notice, if any, as it may deem proper,
appoint a Successor Capital Securities Guarantee Trustee.
(e) No Capital Securities Guarantee Trustee shall be
liable for the acts or omissions to act of any Successor Capital
Securities Guarantee Trustee.
(f) Upon termination of this Capital Securities
Guarantee or removal or resignation of the Capital Securities
Guarantee Trustee pursuant to this Section 4.2, the Guarantor
shall pay to the Capital Securities Guarantee Trustee all amounts
due to the Capital Securities Guarantee Trustee accrued to the
date of such termination, removal or resignation.
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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 the Issuer), as and
when due, regardless of any defense, right of set-off or counter-
claim that 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
this Capital Securities Guarantee and of any liability to which
it applies or may apply, presentment, demand for payment, any
right to require a proceeding first against the 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 Capital Securities Guarantee 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 relat-
ing to the Capital 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, Redemption
Price, Liquidation Distribution or any other sums payable under
the terms of the Capital Securities or the extension of time for
the performance of any other obligation under, arising out of, or
in connection with, the Capital Securities (other than an exten-
sion of time for payment of Distributions, Redemption Price,
Liquidation Distribution or other sum payable that results from
the extension of any interest payment period on the Debentures
permitted by the Indenture);
(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 Capital Securities, or any action on
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the part of the Issuer granting indulgence or extension of any
kind;
(d) the voluntary or involuntary liquidation, dissolu-
tion, sale of any collateral, receivership, insolvency, bankrupt-
cy, 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
Capital Securities;
(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 with respect to the Guarantee Payments shall be
absolute and unconditional under any and all circumstances.
There shall be no obligation of the Holders to give
notice to, or obtain consent of, the Guarantor with respect to
the happening of any of the foregoing.
SECTION 5.4 Rights of Holders
(a) The Holders of a Majority in liquidation amount of
the Capital Securities have the right to direct the time, method
and place of conducting any proceeding for any remedy available
to the Capital Securities Guarantee Trustee in respect of this
Capital Securities Guarantee or exercising any trust or power
conferred upon the Capital Securities Guarantee Trustee under
this Capital Securities Guarantee.
(b) If the Capital Securities Guarantee Trustee fails
to enforce such Capital Securities Guarantee, any Holder of
Capital Securities may institute a legal proceeding directly
against the Guarantor to enforce the Capital Securities Guarantee
Trustee's rights under this Capital Securities Guarantee, without
first instituting a legal proceeding against the Issuer, the
Capital Securities Guarantee Trustee or any other person or
entity. The Guarantor waives any right or remedy to require that
any action be brought first against the Issuer or any other person
or entity before proceeding directly against the Guarantor.
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SECTION 5.5 Guarantee of Payment
This Capital Securities Guarantee creates a guarantee
of payment and not of collection.
SECTION 5.6 Subrogation
The Guarantor shall be subrogated to all (if any)
rights of the Holders of Capital Securities against the Issuer in
respect of any amounts paid to such Holders by the Guarantor
under this Capital Securities Guarantee; provided, however, that
the Guarantor shall not (except to the extent required by manda-
tory provisions of law) be entitled to enforce or exercise any
right that it may acquire by way of subrogation or any indemnity,
reimbursement or other agreement, in all cases as a result of
payment under this Capital Securities Guarantee, if, at the time
of any such payment, any amounts are due and unpaid under this
Capital Securities Guarantee. 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 hereun-
der are independent of the obligations of the Issuer with respect
to the Capital Securities, and that the Guarantor shall be liable
as principal and as debtor hereunder to make Guarantee Payments
pursuant to the terms of this Capital Securities Guarantee
notwithstanding the occurrence of any event referred to in
subsections (a) through (g), inclusive, of Section 5.3 hereof.
ARTICLE VI
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions
So long as any Capital Securities remain outstanding,
the Guarantor shall not (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire, or make a liqui-
dation payment with respect to, any of the Guarantor's capital
stock (which includes common and preferred stock) or (ii) make
any payment of principal, interest or premium, if any, on or
repay or repurchase or redeem any debt securities of the Guaran-
tor (including any Other Debentures) that rank pari passu with or
junior in right of payment to the Debentures or (iii) make any
guarantee payments with respect to any guarantee by the Guarantor
of the debt securities of any subsidiary of the Guarantor (in-
cluding Other Guarantees) if such guarantee ranks pari passu or
junior in right of payment to the Debentures (other than (a)
dividends or distributions in shares of, or options, warrants,
17
<PAGE>
rights to subscribe for or purchase shares of, common stock of
the Guarantor, (b) any declaration of a dividend in connection
with the implementation of a stockholder's 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 Capital Securities Guarantee, (d) as a result
of a reclassification of the Guarantor's capital stock or the
exchange or the conversion of one class or series of the
Guarantor's capital stock for another class or series of the
Guarantor's capital stock, (e) the purchase of fractional inter-
ests in shares of the Guarantor's capital stock pursuant to the
conversion or exchange provisions of such capital stock or the
security being converted or exchanged, and (f) purchases of
common stock related to the issuance of common stock or rights
under any of the Guarantor's benefit plans for its directors,
officers or employees or any of the Guarantor's dividend rein-
vestment plans) if at such time (i) there shall have occurred any
event of which the Guarantor has actual knowledge that (a) is, or
with the giving of notice or the lapse of time, or both, would be
an Event of Default and (b) in respect of which the Guarantor
shall not have taken reasonable steps to cure, (ii) if such
Debentures are held by the Property Trustee, the Guarantor shall
be in default with respect to its payment of any obligations
under this Capital Securities Guarantee or (iii) the Guarantor
shall have given notice of its election of the exercise of its
right to extend the interest payment period pursuant to Section
16.01 of the Indenture and any such extension shall be continu-
ing.
SECTION 6.2 Ranking
This Capital Securities Guarantee will constitute an
unsecured obligation of the Guarantor and will rank (i) subordi-
nate and junior in right of payment to Senior Indebtedness (as
defined in the Indenture), to the same extent and in the same
manner that the Debentures are subordinated to Senior Indebted-
ness pursuant to the Indenture (except as indicated below), it
being understood that the terms of Article XV of the Indenture
shall apply to the obligations of the Guarantor under this
Capital Securities Guarantee as if (x) such Article XV were set
forth herein in full and (y) such obligations were substituted
for the term "Securities" appearing in such Article XV, except
that with respect to Section 15.03 of the Indenture only, the
term "Senior Indebtedness" shall mean all liabilities of the
Guarantor, whether or not for money borrowed (other than obliga-
tions referred to in clause (ii) below), (ii) pari passu with the
most senior preferred or preference stock now or hereafter issued
by the Guarantor and with any Other Guarantee, any Other Common
Securities Guarantee and any guarantee now or hereafter entered
into by the Guarantor in respect of any preferred or preference
stock of any Affiliate of the Guarantor, and (iii) senior to the
Guarantor's common stock.
18
<PAGE>
ARTICLE VII
TERMINATION
SECTION 7.1 Termination
This Capital Securities Guarantee shall terminate (i)
upon full payment of the Redemption Price of all Capital Securi-
ties, or (ii) upon liquidation of the Issuer, the full payment of
the amounts payable in accordance with the Declaration or the
distribution of the Debentures to the Holders of all of the
Capital Securities. Notwithstanding the foregoing, this Capital
Securities Guarantee will continue to be effective or will be
reinstated, as the case may be, if at any time any Holder of
Capital Securities must restore payment of any sums paid under
the Capital Securities or under this Capital Securities Guaran-
tee.
ARTICLE VIII
INDEMNIFICATION
SECTION 8.1 Exculpation
(a) No Indemnified Person shall be liable, responsible
or accountable in damages or otherwise to the Guarantor or any
Covered Person for any loss, damage or claim incurred by reason
of any act or omission performed or omitted by such Indemnified
Person in good faith in accordance with this Capital Securities
Guarantee and in a manner that such Indemnified Person reasonably
believed to be within the scope of the authority conferred on
such Indemnified Person by this Capital Securities Guarantee or
by law, except that an Indemnified Person shall be liable for any
such loss, damage or claim incurred by reason of such Indemnified
Person's negligence or willful misconduct with respect to such
acts or omissions.
(b) An Indemnified Person shall be fully protected in
relying in good faith upon the records of the Guarantor and upon
such information, opinions, reports or statements presented to
the Guarantor by any Person as to matters the Indemnified Person
reasonably believes are within such other Person's professional
or expert competence and who has been selected with reasonable
care by or on behalf of the Guarantor, including information,
opinions, reports or statements as to the value and amount of the
assets, liabilities, profits, losses, or any other facts perti-
nent to the existence and amount of assets from which Distribu-
tions to Holders of Capital Securities might properly be paid.
SECTION 8.2 Indemnification
The Guarantor agrees to indemnify each Indemnified
Person for, and to hold each Indemnified Person harmless against,
19
<PAGE>
any and all loss, liability, damage, claim or expense incurred
without negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of the trust or
trusts hereunder, including the costs and expenses (including
reasonable legal fees and expenses) of defending itself against,
or investigating, any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder.
The obligation to indemnify as set forth in this Section 8.2
shall survive the termination of this Capital Securities Guaran-
tee.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Successors and Assigns
All guarantees and agreements contained in this Capital
Securities Guarantee shall bind the successors, assigns, receiv-
ers, trustees and representatives of the Guarantor and shall
inure to the benefit of the Holders of the Capital Securities
then outstanding.
SECTION 9.2 Amendments
Except with respect to any changes that do not materi-
ally adversely affect the rights of Holders (in which case no
consent of Holders will be required), this Capital Securities
Guarantee may only be amended with the prior approval of the
Holders of a Majority in liquidation amount of the Capital
Securities (including the amount payable on redemption, liquida-
tion or otherwise, plus accumulated and unpaid Distributions to
the date upon which the voting percentages are determined). The
provisions of Section 12.2 of the Declaration with respect to
meetings of Holders of the Securities apply to the giving of such
approval.
SECTION 9.3 Notices
All notices provided for in this Capital Securities
Guarantee shall be in writing, duly signed by the party giving
such notice, and shall be delivered, telecopied or mailed by
first class mail, as follows:
20
<PAGE>
(a) If given to the Issuer, in care of the Administra-
tive Trustee at the Issuer's mailing address set forth below (or
such other address as the Issuer may give notice of to the
Holders of the Common Securities):
BankBoston Capital Trust III
c/o BankBoston Corporation
P.O. Box 2016
Boston, Massachusetts 02106-2016
Attention: Kathleen M. McGillycuddy,
Administrative Trustee
Telecopy: (617) 434-0501
(b) If given to the Capital Securities Guarantee
Trustee, at the Capital Securities Guarantee Trustee's mailing
address set forth below (or such other address as the Capital
Securities Guarantee Trustee may give notice of to the Holders of
the Capital Securities):
The Bank of New York
101 Barclay Street, 21 West
New York, New York 10286
Attention: Corporate Trust Trustee
Administration
Telecopy: (212) 815-5915
(c) If given to the Guarantor, at the Guarantor's
mailing address set forth below (or such other address as the
Guarantor may give notice of to the Holders of the Capital
Securities):
BankBoston Corporation
100 Federal Street, MA BOS 01-25-01
Boston, Massachusetts 02110
Attention: Gary A. Spiess, General Counsel
Telecopy: (617) 434-6525
(d) If given to any Holder of Capital Securities, at
the address set forth on the books and records of the Issuer.
All such notices 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 deliv-
ered 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 9.4 Benefit
This Capital Securities Guarantee is solely for the
benefit of the Holders of the Capital Securities and, subject to
21
<PAGE>
Section 3.1(a), is not separately transferable from the Capital
Securities.
SECTION 9.5 Governing Law
THIS CAPITAL SECURITIES GUARANTEE SHALL BE GOVERNED BY,
AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES
THEREOF.
22
<PAGE>
THIS CAPITAL SECURITIES GUARANTEE is executed as of the
day and year first above written.
BANKBOSTON CORPORATION,
as Guarantor
By:
--------------------------------
Name:
Title:
THE BANK OF NEW YORK, as Capital
Securities Guarantee Trustee
By:
--------------------------------
Name:
Title:
(Capital Securities Guarantee)
<PAGE>
THIS CAPITAL SECURITIES GUARANTEE is executed as of the
day and year first above written.
BANKBOSTON CORPORATION,
as Guarantor
By:
--------------------------------
Name:
Title:
THE BANK OF NEW YORK, as Capital
Securities Guarantee Trustee
By:
--------------------------------
Name:
Title:
(Capital Securities Guarantee)
<PAGE>
EXHIBIT 5.1
May 29, 1997
Bank of Boston Corporation
100 Federal Street
Boston, Massachusetts 02110
Re: Bank of Boston Corporation
BankBoston Capital Trust III
Registration Statement on Form S-3
File No. 333-27229
Ladies and Gentlemen:
We have acted as counsel to BankBoston Corporation, a Massachusetts
corporation (the "Corporation") and Sponsor of BankBoston Capital Trust III, a
statutory business trust formed under the laws of the State of Delaware (the
"Trust"), in connection with a Registration Statement on Form S-3, filed by the
Corporation and the Trust on May 16, 1997 with the Securities and Exchange
Commission pursuant to the Securities Act of 1933, as amended (the "1933 Act"),
as amended by Amendment No. 1 to the Registration Statement filed with the
Commission on May 29, 1997 (as so amended, the "Registration Statement")
relating to the registration of the Floating Rate Capital Securities of the
Trust (the "Capital Securities"), the Floating Rate Junior Subordinated
Deferrable Interest Debentures due _________, 2027 of the Corporation (the
"Junior Subordinated Debentures"), and a Guarantee of the Corporation with
respect to the Capital Securities (the "Guarantee").
The Capital Securities will be issued pursuant an Amended and Restated
Declaration of Trust (the "Amended Declaration") of the Trust, among the
Corporation, as Sponsor of the Trust, The Bank of New York, as property trustee,
The Bank of New York (Delaware), as Delaware trustee, and the Administrative
Trustees named therein, while the Junior Subordinated Debentures will be issued
pursuant to an Indenture (the "Indenture"), between the Corporation and The Bank
of New York, as debenture trustee.
This opinion is being delivered in accordance with the requirements of Item
601(b)(5) of Regulation S-K under the 1933 Act.
We have examined such documents and records as we deemed appropriate,
including the following:
<PAGE>
(i) Copy of the Restated Articles of Organization of the Corporation,
certified as of a recent date by the Secretary of State of The Commonwealth
of Massachusetts.
(ii) Copy of the By-Laws of the Corporation, as amended, certified as
of a recent date by an Assistant Clerk of the Corporation to be a true and
complete copy.
(iii) Copy, certified as of a recent date by an Assistant Clerk of the
Corporation to be a true copy, of the votes of the Executive Committee of
the Board of Directors of the Corporation adopted November 15, 1996
authorizing the filing of the Registration Statement .
(iv) Form of the Amended Declaration.
(v) Form of the Capital Security.
(vi) Form of the Indenture.
(vii) Form of the Junior Subordinated Debenture.
(viii) Form of the Guarantee.
In addition, as to questions of fact material to our opinions, we have
relied upon certificates of officers of the Corporation, the Administrative
Trustees of the Trust and public officials.
In the course of our examination, we have assumed the legal capacity of all
natural persons, the genuineness of all signa tures, the authenticity of all
documents submitted to us as originals, the conformity to original documents of
all documents submitted to us as certified or photostatic copies and the
authenticity of the originals of such latter documents. In making our
examination of documents executed by parties other than the Corporation or the
Trust, we have assumed that such par ties had the power, corporate or other, to
enter into and perform all obligations thereunder and have also assumed the due
authori zation by all requisite action, corporate or other, and execution and
delivery by such parties of such documents and the validity and binding effect
thereof on such parties.
Based upon the foregoing, we are of the opinion that:
(1) The Junior Subordinated Debentures have been duly authorized by all
requisite corporate action of the Corporation and, when executed, authenticated
and delivered in the manner provided for in the Indenture, the Junior
Subordinated Debentures will constitute valid and binding obligations of the
Corporation entitled to the benefits of the Indenture and enforceable against
the Corporation in accordance with their terms, except as enforcement thereof
may be limited by bankruptcy, insolvency, reorganization, moratorium or other
similar laws relating to or
2
<PAGE>
affecting creditors' rights generally or by general equitable principles
(regardless of whether considered in a proceeding in equity or at law).
(2) The Guarantee has been duly authorized by all requisite corporate
action of the Corporation and, when executed and delivered to The Bank of New
York, as guarantee trustee, the Guarantee will constitute a valid and binding
agreement of the Corporation, enforceable against the Corporation in accordance
with its terms, except as enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws relating to or
affecting creditors' rights generally or by general equitable principles
(regardless of whether considered in a proceeding in equity or at law).
We are members of the Bar of the State of New York and we express no
opinion as to the laws of any jurisdiction other than the laws of the State of
New York and the federal laws of the United States of America and, with respect
to the laws of The Commonwealth of Massachusetts, we have made no independent
inves tigation of such laws and have relied on all matters governed by such laws
upon the opinion of Gary A. Spiess, General Counsel of the Corporation.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to our firm under the caption
"Validity of Securities" contained in the Prospectus included therein.
Very truly yours,
/s/ Brown & Wood LLP
BROWN & WOOD LLP
3
<PAGE>
EXHIBIT 5.2
[Letterhead of Skadden, Arps, Slate, Meagher & Flom LLP]
May 29, 1997
BankBoston Capital Trust III
BankBoston Corporation
c/o BankBoston Corporation
100 Federal Street
MA BOS 01-25-01
Boston, Massachusetts 02110
Ladies and Gentlemen:
We have acted as special Delaware counsel to
BankBoston Capital Trust III (the "Trust"), a business
trust formed under the Business Trust Act of the State of
Delaware (Chapter 38, Title 12, of the Delaware Code,
12 Del. C. SECTION 3801 et. seq.), and BankBoston Corporation,
a Massachusetts corporation (the "Company"), in connec-
tion with the preparation of the Registration Statement
on Form S-3 filed by the Company and the Trust with the
Securities and Exchange Commission (the "Commission") on
May 16, 1997, and Amendment No. 1 thereto, to be filed
with the Commission on the date hereof (such Registration
Statement, as so amended, being hereinafter referred to
as the "Registration Statement"), with respect to the
registration under the Securities Act of 1933, as amended
(the "Act"), of, among other securities, Capital Securi-
ties (liquidation amount of $1,000 per security) of the
Trust (the "Capital Securities").
The Capital Securities are to be issued pursu-
ant to the Amended and Restated Declaration of Trust of
the Trust (the "Declaration"), among the Company, as
sponsor of the Trust, Robert T. Jefferson, Kathleen M.
McGillycuddy and Craig V. Starble, as administrative
trustees, The Bank of New York, as property trustee (the
"Property Trustee"), and The Bank of New York (Delaware),
as Delaware trustee.
<PAGE>
BankBoston Capital Trust III
BankBoston Corporation
May 29, 1997
Page 2
This opinion is being delivered in accordance
with the requirements of Item 601(b)(5) of Regulation S-K
under the Act.
In connection with this opinion, we have exam-
ined originals or copies, certified or otherwise identi-
fied to our satisfaction, of (i) the Registration State-
ment; (ii) the Certificate of Trust of the Trust filed
with the Secretary of State of the State of Delaware on
May 14, 1997; (iii) the form of the Declaration; (iv) the
form of the Capital Securities and a specimen certificate
thereof; and (v) the form of the Purchase Agreement (the
"Purchase Agreement") proposed to be entered into among
the Company, the Trust and the representatives for the
Underwriters named therein (collectively, the "Underwrit-
ers") relating to, among other things, the sale of the
Capital Securities. We have also examined originals or
copies, certified or otherwise identified to our satis-
faction, of such other documents, certificates and re-
cords as we have deemed necessary or appropriate as a
basis for the opinions set forth herein.
In our examination, we have assumed the legal
capacity of all natural persons, the genuineness of all
signatures, the authenticity of all documents submitted
to us as originals, the conformity to original documents
of all documents submitted to us as certified or photo-
static copies and the authenticity of the originals of
such copies. In making our examination of documents
executed or to be executed by parties other than the
Trust, we have assumed that such parties had or will have
the power, corporate or other, to enter into and perform
all obligations thereunder and have also assumed the due
authorization by all requisite action, corporate or
other, and execution and delivery by such parties of such
documents and the validity and binding effect thereof on
such parties. In addition, we have assumed that the
Declaration and the Capital Securities when executed will
be in substantially the forms reviewed by us. As to any
facts material to the opinions expressed herein which we
did not independently establish or verify, we have relied
upon oral or written statements and representations of
<PAGE>
BankBoston Capital Trust III
BankBoston Corporation
May 29, 1997
Page 3
officers, trustees and other representatives of the
Company, the Trust and others.
Members of our firm are admitted to the bar in
the State of Delaware, and we do not express any opinion
as to laws of any other jurisdiction.
Based upon and subject to the foregoing and the
limitations, qualifications, exceptions and assumptions
set forth herein, we are of the opinion that when (i) the
Registration Statement becomes effective; (ii) the Decla-
ration and the Purchase Agreement have been duly executed
and delivered by the parties thereto; (iii) the Declara-
tion has been qualified under the Trust Indenture Act of
1939, as amended; and (iv) the terms of the Capital
Securities have been duly established in accordance with
the Declaration and the Capital Securities have been duly
executed and authenticated in accordance with the Decla-
ration and delivered to and paid for by the Underwriters
as contemplated by the Purchase Agreement, the Capital
Securities will have been duly authorized for issuance by
the Trust and will be validly issued, fully paid and
nonassessable, representing undivided beneficial inter-
ests in the assets of the Trust; and the holders of the
Capital Securities will be entitled to the same limita-
tion of personal liability extended to stockholders of
private corporations for profit organized under the
General Corporation Law of the State of Delaware. We
bring to your attention, however, that the holders of the
Capital Securities may be obligated, pursuant to the
Declaration, to (i) provide indemnity and/or security in
connection with, and pay taxes or governmental charges
arising from, transfers of Capital Securities and the
issuance of replacement Capital Securities and (ii)
provide security and indemnity in connection with re-
quests of or directions to the Property Trustee to exer-
cise its rights and powers under the Declaration.
<PAGE>
BankBoston Capital Trust III
BankBoston Corporation
May 29, 1997
Page 4
We hereby consent to the use of our name under
the heading "Validity of Securities" in the prospectus
which forms a part of the Registration Statement. We
also hereby consent to the filing of this opinion with
the Commission as an exhibit to the Registration State-
ment. In giving this consent, we do not thereby admit
that we are within the category of persons whose consent
is required under Section 7 of the Act or the rules and
regulations of the Commission promulgated thereunder.
This opinion is expressed as of the date hereof, and we
disclaim any undertaking to advise you of any subsequent
changes in the facts stated or assumed herein or of any
subsequent changes in applicable law.
Very truly yours,
/s/ Skadden, Arps, Slate, Meagher & Flom LLP
<PAGE>
EXHIBIT 8
May 29, 1997
BankBoston Corporation
100 Federal Street
Boston, Massachusetts 02110
Re: BankBoston Corporation
BankBoston Capital Trust III
Registration Statement
File No. 333-27229
Dear Sirs:
We have acted as special tax counsel to BankBoston Corporation, a
Massachusetts corporation (the "Corporation") and Sponsor of BankBoston Capital
Trust III, a statutory business trust formed under the laws of the State of
Delaware (the "Trust"), in connection with a Registration Statement on Form S-3,
filed by the Corporation and the Trust on May 16, 1997 with the Securities and
Exchange Commission pursuant to the Securities Act of 1933, as amended (the
"1933 Act"), as amended by Amendment No. 1 to the Registration Statement filed
with the Commission on May 29, 1997 (as so amended, the "Registration
Statement") relating to the registration of the Floating Rate Capital Securities
of the Trust (the "Capital Securities"), the Floating Rate Junior Subordinated
Deferrable Interest Debentures due _________, 2027 of the Corporation, and a
Guarantee of the Corporation with respect to the Capital Securities.
In rendering our opinion, we have examined an Amended and Restated Declaration
of Trust (the "Trust Agreement") of the Trust among the Corporation, as Sponsor
of the Trust, The Bank of New York, as property trustee, The Bank of New York
(Delaware), as Delaware trustee, and the Administrative Trustees named therein,
and have assumed that the Issuer Trustees will conduct the affairs of the Trust
in accordance with the Trust Agreement. We hereby confirm the opinions
described under the caption "Certain United States Federal Income Tax
Consequences" in the prospectus (the "Prospectus") that is part of the
Registration Statement. Capitalized terms used herein but not defined have the
meanings as provided in the Prospectus.
<PAGE>
We hereby consent to the use of our name under the caption "Certain United
States Federal Income Tax Consequences" in the Prospectus. The issuance of such
a consent does not concede that we are an "Expert" for the purposes of the 1933
Act.
Very truly yours,
/s/ Brown & Wood LLP
BROWN & WOOD LLP
2
<PAGE>
EXHIBIT 25.1
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) |__|
----------------------
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
----------------------
BANKBOSTON CORPORATION
(Exact name of obligor as specified in its charter)
Massachusetts 04-2471221
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
100 Federal Street
Boston, Massachusetts 02110
(Address of principal executive offices) (Zip code)
______________________
Floating Rate Junior Subordinated Deferrable Interest Debentures
(Title of the indenture securities)
================================================================================
<PAGE>
1. GENERAL INFORMATION. FURNISH THE FOLLOWING INFORMATION AS TO THE TRUSTEE:
(A) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING AUTHORITY TO WHICH IT
IS SUBJECT.
- --------------------------------------------------------------------------------
Name Address
- --------------------------------------------------------------------------------
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y.
12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(B) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16.LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION, ARE
INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO RULE 7A-29
UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17 C.F.R. 229.10(D).
1. A copy of the Organization Certificate of The Bank of New York (formerly
Irving Trust Company) as now in effect, which contains the authority to
commence business and a grant of powers to exercise corporate trust
powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with
Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed
with Registration Statement No. 33-21672 and Exhibit 1 to Form T-1 filed
with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
-2-
<PAGE>
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No. 33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
-3-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New York, a
corporation organized and existing under the laws of the State of New York, has
duly caused this statement of eligibility to be signed on its behalf by the
undersigned, thereunto duly authorized, all in The City of New York, and State
of New York, on the 28th day of May, 1997.
THE BANK OF NEW YORK
By: /s/ WALTER N. GITLIN
-------------------------
Name: WALTER N. GITLIN
Title: VICE PRESIDENT
-4-
<PAGE>
EXHIBIT 7
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street New York, NY 10286
And Foreign and Domestic Subsidiaries.
a member of the Federal Reserve System, at the close of business December 31,
1996, published in accordance with a call made by the Federal Reserve Bank in
this District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
ASSETS in Thousands
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin........... $ 6,024,505
Interest-bearing balances.................................... 808,821
Securities:
Held-to-maturity securities.................................. 1,071,747
Available-for-sale securities................................ 3,105,207
Federal funds sold in domestic offices of the bank............ 4,250,941
Loans and lease financing receivables:
Loans and leases, net of unearned income..................... 31,962,915
LESS: Allowance for loan and lease losses.................... 635,084
LESS: Allocated transfer risk reserve........................ 429
Loans and leases, net of unearned income, allowance,
and reserve................................................. 31,327,402
Assets held in trading accounts............................... 1,539,612
Promises and fixed assets (including capitalized leases)...... 692,317
Other real estate owned....................................... 22,123
Investments in unconsolidated subsidiaries and
associated companies......................................... 213,512
Customers' liability to this bank on acceptances
outstanding.................................................. 985,297
Intangible Assets............................................. 590,973
Other assets.................................................. 1,487,903
------------
Total assets.................................................. 552,120,450
============
LIABILITIES
Deposits
In domestic offices.......................................... $ 25,929,642
Noninterest-bearing.......................................... 11,245,050
Interest-bearing............................................. 14,684,592
In foreign offices Edge and Agreement subsidiaries
and IBFs.................................................... 12,852,809
Noninterest-bearing.......................................... 552,203
Interest-bearing............................................. 12,300,606
Federal funds purchased and securities sold under
agreements to repurchase in domestic offices of the
bank and of its Edge and Agreement subsidiaries and
in IBFs.
Federal funds purchased...................................... 1,360,877
Securities sold under agreements to repurchase............... 226,158
Demand notes issued to the US Treasury........................ 204,987
Trading liabilities........................................... 1,437,445
Other borrowed money
With original maturity of one year or less................... 2,312,556
With original maturity of more than one year................. 20,766
Bank's liability on acceptances executed and outstanding...... 1,014,717
Subordinated notes and debentures............................. 1,014,400
Other liabilities............................................. 1,721,291
------------
Total liabilities............................................. 49,095,648
------------
EQUITY CAPITAL
Common Stock.................................................. 942,284
Surplus....................................................... 731,319
Undivided profits and capital reserves........................ 2,354,095
Net unrealized holding gains (losses) on available-
for-sale securities.......................................... 7,030
Cumulative foreign currency transaction adjustments........... (9,918)
------------
Total equity capital.......................................... 4,024,812
------------
Total liabilities and equity capital.......................... $ 52,120,450
============
I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of the Report
of Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct
J. Carter Bacor
Thomas A. Renya Directors
Allan R. Griffith
<PAGE>
EXHIBIT 25.2
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) |__|
----------------------
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
----------------------
BANKBOSTON CAPITAL TRUST III
(Exact name of obligor as specified in its charter)
Delaware Applied For
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
100 Federal Street
Boston, Massachusetts 02110
(Address of principal executive offices) (Zip code)
______________________
Floating Rate Capital Securities
(Title of the indenture securities)
================================================================================
<PAGE>
1. GENERAL INFORMATION. FURNISH THE FOLLOWING INFORMATION AS TO THE TRUSTEE:
(A) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING AUTHORITY TO WHICH IT
IS SUBJECT.
- --------------------------------------------------------------------------------
Name Address
- --------------------------------------------------------------------------------
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y.
12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(B) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION, ARE
INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO RULE 7A-29
UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17 C.F.R. 229.10(D).
1. A copy of the Organization Certificate of The Bank of New York (formerly
Irving Trust Company) as now in effect, which contains the authority to
commence business and a grant of powers to exercise corporate trust
powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with
Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed
with Registration Statement No. 33-21672 and Exhibit 1 to Form T-1 filed
with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
-2-
<PAGE>
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No. 33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
-3-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New York, a
corporation organized and existing under the laws of the State of New York, has
duly caused this statement of eligibility to be signed on its behalf by the
undersigned, thereunto duly authorized, all in The City of New York, and State
of New York, on the 28th day of May, 1997.
THE BANK OF NEW YORK
By: /S/WALTER N. GITLIN
--------------------------
Name: WALTER N. GITLIN
Title: VICE PRESIDENT
-4-
<PAGE>
EXHIBIT 7
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street New York, NY 10286
And Foreign and Domestic Subsidiaries.
a member of the Federal Reserve System, at the close of business December 31,
1996, published in accordance with a call made by the Federal Reserve Bank in
this District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
ASSETS in Thousands
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin........... $ 6,024,505
Interest-bearing balances.................................... 808,821
Securities:
Held-to-maturity securities.................................. 1,071,747
Available-for-sale securities................................ 3,105,207
Federal funds sold in domestic offices of the bank............ 4,250,941
Loans and lease financing receivables:
Loans and leases, net of unearned income..................... 31,962,915
LESS: Allowance for loan and lease losses.................... 635,084
LESS: Allocated transfer risk reserve........................ 429
Loans and leases, net of unearned income, allowance,
and reserve................................................. 31,327,402
Assets held in trading accounts............................... 1,539,612
Promises and fixed assets (including capitalized leases)...... 692,317
Other real estate owned....................................... 22,123
Investments in unconsolidated subsidiaries and
associated companies......................................... 213,512
Customers' liability to this bank on acceptances
outstanding.................................................. 985,297
Intangible Assets............................................. 590,973
Other assets.................................................. 1,487,903
------------
Total assets.................................................. 552,120,450
============
LIABILITIES
Deposits
In domestic offices.......................................... $ 25,929,642
Noninterest-bearing.......................................... 11,245,050
Interest-bearing............................................. 14,684,592
In foreign offices Edge and Agreement subsidiaries
and IBFs.................................................... 12,852,809
Noninterest-bearing.......................................... 552,203
Interest-bearing............................................. 12,300,606
Federal funds purchased and securities sold under
agreements to repurchase in domestic offices of the
bank and of its Edge and Agreement subsidiaries and
in IBFs.
Federal funds purchased...................................... 1,360,877
Securities sold under agreements to repurchase............... 226,158
Demand notes issued to the US Treasury........................ 204,987
Trading liabilities........................................... 1,437,445
Other borrowed money
With original maturity of one year or less................... 2,312,556
With original maturity of more than one year................. 20,766
Bank's liability on acceptances executed and outstanding...... 1,014,717
Subordinated notes and debentures............................. 1,014,400
Other liabilities............................................. 1,721,291
------------
Total liabilities............................................. 49,095,648
------------
EQUITY CAPITAL
Common Stock.................................................. 942,284
Surplus....................................................... 731,319
Undivided profits and capital reserves........................ 2,354,095
Net unrealized holding gains (losses) on available-
for-sale securities.......................................... 7,030
Cumulative foreign currency transaction adjustments........... (9,918)
------------
Total equity capital.......................................... 4,024,812
------------
Total liabilities and equity capital.......................... $ 52,120,450
============
I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of the Report
of Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct
J. Carter Bacor
Thomas A. Renya Directors
Allan R. Griffith
<PAGE>
EXHIBIT 25.3
================================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) |__|
----------------------
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
----------------------
BANKBOSTON CORPORATION
(Exact name of obligor as specified in its charter)
Massachusetts 04-2471221
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
100 Federal Street
Boston, Massachusetts 02110
(Address of principal executive offices) (Zip code)
______________________
Guarantee of Floating Rate Capital Securities of
BankBoston Capital Trust III
(Title of the indenture securities)
================================================================================
<PAGE>
1. GENERAL INFORMATION. FURNISH THE FOLLOWING INFORMATION AS TO THE TRUSTEE:
(A) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING AUTHORITY TO WHICH IT
IS SUBJECT.
- --------------------------------------------------------------------------------
Name Address
- --------------------------------------------------------------------------------
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y.
12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(B) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16.LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION, ARE
INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO RULE 7A-29
UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17 C.F.R. 229.10(D).
1. A copy of the Organization Certificate of The Bank of New York (formerly
Irving Trust Company) as now in effect, which contains the authority to
commence business and a grant of powers to exercise corporate trust
powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed with
Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed
with Registration Statement No. 33-21672 and Exhibit 1 to Form T-1 filed
with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
-2-
<PAGE>
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No. 33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
-3-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New York, a
corporation organized and existing under the laws of the State of New York, has
duly caused this statement of eligibility to be signed on its behalf by the
undersigned, thereunto duly authorized, all in The City of New York, and State
of New York, on the 28th day of May, 1997.
THE BANK OF NEW YORK
By: /S/WALTER N. GITLIN
--------------------------
Name: WALTER N. GITLIN
Title: VICE PRESIDENT
-4-
<PAGE>
EXHIBIT 7
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street New York, NY 10286
And Foreign and Domestic Subsidiaries.
a member of the Federal Reserve System, at the close of business December 31,
1996, published in accordance with a call made by the Federal Reserve Bank in
this District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
ASSETS in Thousands
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin........... $ 6,024,505
Interest-bearing balances.................................... 808,821
Securities:
Held-to-maturity securities.................................. 1,071,747
Available-for-sale securities................................ 3,105,207
Federal funds sold in domestic offices of the bank............ 4,250,941
Loans and lease financing receivables:
Loans and leases, net of unearned income..................... 31,962,915
LESS: Allowance for loan and lease losses.................... 635,084
LESS: Allocated transfer risk reserve........................ 429
Loans and leases, net of unearned income, allowance,
and reserve................................................. 31,327,402
Assets held in trading accounts............................... 1,539,612
Promises and fixed assets (including capitalized leases)...... 692,317
Other real estate owned....................................... 22,123
Investments in unconsolidated subsidiaries and
associated companies......................................... 213,512
Customers' liability to this bank on acceptances
outstanding.................................................. 985,297
Intangible Assets............................................. 590,973
Other assets.................................................. 1,487,903
------------
Total assets.................................................. 552,120,450
============
LIABILITIES
Deposits
In domestic offices.......................................... $ 25,929,642
Noninterest-bearing.......................................... 11,245,050
Interest-bearing............................................. 14,684,592
In foreign offices Edge and Agreement subsidiaries
and IBFs.................................................... 12,852,809
Noninterest-bearing.......................................... 552,203
Interest-bearing............................................. 12,300,606
Federal funds purchased and securities sold under
agreements to repurchase in domestic offices of the
bank and of its Edge and Agreement subsidiaries and
in IBFs.
Federal funds purchased...................................... 1,360,877
Securities sold under agreements to repurchase............... 226,158
Demand notes issued to the US Treasury........................ 204,987
Trading liabilities........................................... 1,437,445
Other borrowed money
With original maturity of one year or less................... 2,312,556
With original maturity of more than one year................. 20,766
Bank's liability on acceptances executed and outstanding...... 1,014,717
Subordinated notes and debentures............................. 1,014,400
Other liabilities............................................. 1,721,291
------------
Total liabilities............................................. 49,095,648
------------
EQUITY CAPITAL
Common Stock.................................................. 942,284
Surplus....................................................... 731,319
Undivided profits and capital reserves........................ 2,354,095
Net unrealized holding gains (losses) on available-
for-sale securities.......................................... 7,030
Cumulative foreign currency transaction adjustments........... (9,918)
------------
Total equity capital.......................................... 4,024,812
------------
Total liabilities and equity capital.......................... $ 52,120,450
============
I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of the Report
of Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct
J. Carter Bacor
Thomas A. Renya Directors
Allan R. Griffith
