<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON , 1997
FILE NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
<TABLE>
<S> <C> <C>
STAR BANC CORPORATION OHIO 31-0838189
STAR CAPITAL I DELAWARE APPLIED FOR
(EXACT NAME OF REGISTRANT AS (STATE OR OTHER JURISDICTION (I.R.S. EMPLOYER
SPECIFIED IN ITS CHARTER) OF INCORPORATION OR ORGANIZATION) IDENTIFICATION NUMBER)
</TABLE>
425 WALNUT STREET
CINCINNATI, OHIO 45202
(513) 632-4000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING
AREA CODE, OF REGISTRANTS' PRINCIPAL EXECUTIVE OFFICES)
------------------------
JENNIE P. CARLSON
SENIOR VICE PRESIDENT, GENERAL
COUNSEL AND SECRETARY
STAR BANC CORPORATION
425 WALNUT STREET
CINCINNATI, OHIO 45202
(513) 632-4000
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
COPIES TO:
LEE MEYERSON
SIMPSON THACHER & BARTLETT
425 LEXINGTON AVENUE
NEW YORK, NEW YORK 10017
(212) 455-2000
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after the Registration Statement becomes effective.
If the securities being registered on this form are being offered in
connection with the formation of a holding company and there is compliance with
General Instructions G, 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, 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(d)
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. [ ] ____.
CALCULATION OF REGISTRATION FEE
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C> <C>
- --------------------------------------------------------------------------------
PROPOSED MAXIMUM
AGGREGATE OFFERING PROPOSED MAXIMUM
TITLE OF EACH CLASS OF SECURITIES TO BE AMOUNT TO BE PRICE PER AGGREGATE OFFERING AMOUNT OF
REGISTERED REGISTERED SECURITY(1) PRICE(1) REGISTRATION FEE
- --------------------------------------------------------------------------------------------------------------------------
Capital Securities of Star Capital I............ $150,000,000 100% $150,000,000 $45,455
- --------------------------------------------------------------------------------------------------------------------------
Junior Subordinated Debentures of Star Banc
Corporation(2)................................ -- --
- --------------------------------------------------------------------------------------------------------------------------
Guarantee of Star Banc Corporation(3)........... -- -- -- --
- --------------------------------------------------------------------------------------------------------------------------
Total(4)........................................ $150,000,000 100% $150,000,000 $45,455
==========================================================================================================================
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457.
(2) The Junior Subordinated Debentures will be exchanged for outstanding
unregistered Junior Subordinated Debentures which were purchased by Star
Capital I with the proceeds of the sale of the unregistered Capital
Securities. No separate consideration will be received for the issuance of
Junior Subordinated Debentures. Pursuant in Rule 457(a), no separate fee is
payable with respect to the Junior Subordinated Debentures.
(3) No separate consideration will be received for the issuance of the
Guarantee. Pursuant to Rule 457(a), no separate fee is payable with respect
to the Guarantee.
(4) This Registration Statement is deemed to cover the rights of holders of
Capital Securities of Star Capital I under the Declaration of Trust, and the
rights of holders of Junior Subordinated Debentures under the Junior
Subordinated Indenture and the rights of holders of Capital Securities under
the Guarantee. Star Banc Corporation's obligations under the Declaration of
Trust, the Junior Subordinated Debentures, the Junior Subordinated Indenture
and the Guarantee provide a full and unconditional guarantee of the Capital
Securities.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT 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> 2
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR
MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT
BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR
THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS
OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED AUGUST , 1997
PROSPECTUS
STAR CAPITAL I
OFFER TO EXCHANGE ITS FLOATING RATE CAPITAL SECURITIES
WHICH HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
FOR ITS OUTSTANDING FLOATING RATE CAPITAL SECURITIES
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
FULLY AND UNCONDITIONALLY GUARANTEED,
TO THE EXTENT DESCRIBED HEREIN, BY
STAR BANC CORPORATION
------------------------
THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, ON , 1997, UNLESS EXTENDED.
Star Capital I, a Delaware statutory business trust (the "Trust"), hereby
offers, upon the terms and subject to the conditions set forth in this
Prospectus (as the same may be amended or supplemented from time to time, the
"Prospectus") and in the accompanying Letter of Transmittal (which together
constitute the "Exchange Offer"), to exchange up to $150,000,000 aggregate
liquidation amount of its Floating Rate Capital Securities (the "New Capital
Securities") which have been registered under the Securities Act of 1933, as
amended (the "Securities Act"), pursuant to a Registration Statement (as defined
herein) of which this Prospectus constitutes a part, for a like liquidation
amount of its outstanding Floating Rate Capital Securities (the "Old Capital
Securities"), of which $150,000,000 aggregate liquidation amount is outstanding.
As soon as practicable after the Exchange Offer, Star Banc Corporation, an Ohio
corporation (the "Company"), will exchange its guarantee of the payment of
distributions and payments on liquidation or redemption of the Old Capital
Securities (the "Old Guarantee") for a like guarantee of the New Capital
Securities (the "New Guarantee") and all of its Floating Rate Junior
Subordinated Debentures (the "Old Junior Subordinated Debentures"), of which
$154,640,000 aggregate principal amount is outstanding, for a like aggregate
principal amount of its Floating Rate Junior Subordinated Debentures (the "New
Junior Subordinated Debentures"), which New Guarantee and New Junior
Subordinated Debentures also have been registered under the Securities Act (the
exchange of the Old Capital Securities for the New Capital Securities, the
exchange of the Old Guarantee for the New Guarantee and the exchange of the Old
Junior Subordinated Debentures for the New Junior Subordinated Debentures is
referred to collectively herein as the "Exchange"). The Old Capital Securities,
the Old Guarantee and the Old Junior Subordinated Debentures are collectively
referred to herein as the "Old Securities" and the New Capital Securities, the
New Guarantee and the New Junior Subordinated Debentures are collectively
referred to herein as the "New Securities."
The terms of the New Securities are identical in all material respects to
the respective terms of the Old Securities, except that the New Securities have
been registered under the Securities Act and therefore will not be subject to
certain restrictions on transfer applicable to the Old Securities and will not
be entitled to any increase in the distribution rate thereon or any further
registration rights under the Securities Act, except in certain limited
circumstances. See "Description of the Old Securities."
The New Capital Securities and the Old Capital Securities (together, the
"Capital Securities") represent undivided beneficial ownership interests in the
assets of the Trust. The Company is the owner of all of the beneficial ownership
interests represented by common securities of the Trust (the "Common
Securities"; together with the Capital Securities, the "Trust Securities"). The
Trust exists for the sole purpose of issuing the Trust Securities and investing
the proceeds thereof in the Old Junior Subordinated Debentures, which will be
exchanged for New Junior Subordinated Debentures (together, the "Junior
Subordinated Debentures"). The Junior Subordinated Debentures will mature on
June 15, 2027. The terms of the Capital Securities provide that they will have a
preference under certain circumstances with respect to cash distributions and
amounts payable on liquidation, redemption or otherwise over the Common
Securities. See "Description of Capital Securities -- Subordination of Common
Securities."
SEE "RISK FACTORS" COMMENCING ON PAGE 15 FOR CERTAIN INFORMATION THAT
SHOULD BE CONSIDERED BY HOLDERS WHO TENDER OLD CAPITAL SECURITIES IN THE
EXCHANGE OFFER.
THESE SECURITIES WILL NOT BE DEPOSITS OR OTHER OBLIGATIONS OF A BANK AND WILL
NOT BE INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER
GOVERNMENTAL AGENCY.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
------------------------
The date of this Prospectus is , 1997.
<PAGE> 3
Holders of the Capital Securities are entitled to receive cumulative cash
distributions accruing from the date of original issuance and payable quarterly
in arrears on the fifteenth day of March, June, September and December of each
year (each, an "Interest Payment Date"), commencing September 15, 1997, at a
variable annual rate equal to LIBOR (as defined herein) plus 0.765% of the
liquidation amount of $1,000 per Capital Security ("Distributions"). The
distribution rate and the distribution payment dates and other payment dates for
the Capital Securities correspond to the payments and payment dates on the
Junior Subordinated Debentures, which will be the sole assets of the Trust. The
Company will guarantee the payment of Distributions and payments on liquidation
of the Trust or redemption of the Capital Securities, but only in each case to
the extent of funds held by the Trust, as described herein (the "Guarantee").
See "Description of Guarantee" herein. If the Company does not make interest
payments on the Junior Subordinated Debentures held by the Trust, the Trust will
have insufficient funds to pay Distributions on the Capital Securities. The
Company's obligations under the Guarantee, taken together with its obligations
under the Junior Subordinated Debentures and the Indenture (as defined herein),
including its obligation to pay all costs, expenses and liabilities of the Trust
(other than with respect to the Capital Securities), constitute a full and
unconditional guarantee of all of the Trust's obligations under the Capital
Securities. The obligations of the Company under the Guarantee and the Junior
Subordinated Debentures are subordinate and junior in right of payment to all
Indebtedness (as defined in "Description of Junior Subordinated
Debentures -- Subordination" herein) of the Company and structurally
subordinated to all liabilities and obligations of the Company's subsidiaries.
As of June 30, 1997, approximately $152 million aggregate principal amount of
Indebtedness was outstanding, and the Company's consolidated subsidiaries had
approximately $9.9 billion of indebtedness and other liabilities. The terms of
the Junior Subordinated Debentures place no limitation on the amount of
Indebtedness that may be incurred by the Company or on the amount of liabilities
and obligations of the Company's subsidiaries. See "Description of Junior
Subordinated Debentures -- Subordination."
The Company has the right to defer 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 deferral period
(each, an "Extension Period"), provided that no Extension Period may extend
beyond the Stated Maturity (as defined herein) of the Junior Subordinated
Debentures. Upon the termination of any such Extension Period and the payment of
all amounts then due on any Interest Payment Date, the Company may elect to
begin a new Extension Period subject to the requirements set forth herein.
Accordingly, there could be multiple Extension Periods of varying lengths
throughout the term of the Junior Subordinated Debentures. If interest payments
on the Junior Subordinated Debentures are so deferred, distributions on the
Capital Securities will also be deferred and the Company may not, and may not
permit any subsidiary of the Company to, subject to certain exceptions described
herein, (i) declare or pay any dividends or distributions on, or redeem,
purchase, acquire, or make a liquidation payment with respect to, the Company's
capital stock or (ii) make any payment of principal, interest or premium, if
any, on or repay, repurchase or redeem any debt securities of the Company that
rank pari passu with or junior to the Junior Subordinated Debentures or make any
guarantee payments with respect to any guarantee by the Company of the debt
securities of any subsidiary of the Company if such guarantee ranks pari passu
with or junior to the Junior Subordinated Debentures (other than (a)
repurchases, redemptions or other acquisitions of shares of capital stock of the
Company in connection with any employment contract, benefit plan or other
similar arrangement with or for the benefit of any one or more employees,
officers, directors or consultants or in connection with a dividend reinvestment
or stockholder stock purchase plan, (b) as a result of an exchange or conversion
of any class or series of the Company's capital stock (or any capital stock of a
subsidiary of the Company) for any class or series of the Company's capital
stock or of any class or series of the Company's indebtedness for any class or
series of the Company's capital stock, (c) 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,
(d) any declaration of a dividend in connection with the adoption of any
stockholder's rights plan, or the issuance of rights, stock or other property
under any stockholder's rights plan, or the redemption or repurchase of rights
pursuant thereto, or (e) any dividend in the form of stock, warrants, options or
other rights where the dividend stock or the stock issuable upon exercise of
such warrants, options or other rights is the same stock as that on which the
dividend is being paid or ranks pari passu with or junior to such stock). During
an Extension Period, interest on the Junior Subordinated Debentures will
continue to accrue (and the
2
<PAGE> 4
amount of Distributions to which holders of the Capital Securities are entitled
will accumulate) at the variable rate of LIBOR plus 0.765% per annum, compounded
quarterly, and holders of the Capital Securities will be required to include
such interest income in gross income (as original issue discount ("OID")) for
United States federal income tax purposes prior to receipt of the cash related
to such interest income. See "Description of Junior Subordinated
Debentures -- Option to Extend Interest Payment Period" and "Certain United
States Federal Income Tax Consequences -- Interest Income and Original Issue
Discount."
The Junior Subordinated Debentures are not redeemable prior to June 15,
2007 unless a Special Event (as defined herein) has occurred. The Junior
Subordinated Debentures are redeemable prior to maturity at the option of the
Company, subject to the receipt of any necessary prior approval of the Board of
Governors of the Federal Reserve System (the "Federal Reserve") (i) on or after
June 15, 2007, in whole or in part, at a redemption price equal to 100% of the
principal amount thereof, plus the accrued and unpaid interest thereon, or (ii)
at any time, in whole (but not in part), upon the occurrence and continuation of
a Special Event, at a redemption price equal to 100% of the principal amount
thereof plus the accrued and unpaid interest thereon, in each case subject to
the further conditions described under "Description of Junior Subordinated
Debentures -- Redemption." The Capital Securities are subject to mandatory
redemption, in whole or in part, upon repayment of the Junior Subordinated
Debentures at maturity or their earlier redemption, in an amount equal to the
amount of related Junior Subordinated Debentures maturing or being redeemed and
at a redemption price equal to the redemption price of such Junior Subordinated
Debentures, in each case plus accumulated and unpaid Distributions thereon to
the date of redemption.
Upon the occurrence and continuation of a Special Event, the Company will
have the right, subject to the receipt of any necessary prior approval of the
Federal Reserve, to dissolve the Trust and cause the Junior Subordinated
Debentures to be distributed to the holders of the Capital Securities and the
Common Securities in liquidation of the Trust. See "Description of Capital
Securities -- Redemption -- Special Event Redemption or Distribution of Junior
Subordinated Debentures."
In the event of the liquidation of the Trust, after satisfaction of the
claims of creditors of the Trust, if any, as provided by applicable law, the
holders of the Capital Securities will be entitled to receive a liquidation
amount of $1,000 per Capital Security plus accumulated and unpaid Distributions
thereon to the date of payment, which may be in the form of a distribution of
such amount in Junior Subordinated Debentures as described above. If such
Liquidation Distribution (as defined herein) can be paid only in part because
the Trust has insufficient assets available to pay in full the aggregate
Liquidation Distribution, then the amounts payable directly by the Trust on the
Capital Securities shall be paid on a pro rata basis. The holder(s) of the
Common Securities will be entitled to receive distributions upon any such
liquidation pro rata with the holders of the Capital Securities, except that if
an Indenture Event of Default (as defined herein) has occurred and is
continuing, the Capital Securities shall have a priority over the Common
Securities. See "Description of Capital Securities -- Liquidation Distribution
Upon Dissolution."
The Trust is making the Exchange Offer of the New Capital Securities in
reliance on the position of the staff of the Division of Corporation Finance of
the Securities and Exchange Commission (the "Commission") as set forth in
certain interpretive letters addressed to third parties in other transactions.
However, neither the Company nor the Trust has sought its own interpretive
letter and there can be no assurance that the staff of the Division of
Corporation Finance of the Commission would make a similar determination with
respect to the Exchange Offer as it has in such interpretive letters to third
parties. Based on these interpretations by the staff of the Division of
Corporation Finance, and subject to the two immediately following sentences, the
Company and the Trust believe that New Capital Securities issued pursuant to
this Exchange Offer in exchange for Old Capital Securities may be offered for
resale, resold and otherwise transferred by a holder thereof (other than a
holder who is a broker-dealer) without further compliance with the registration
and prospectus delivery requirements of the Securities Act, provided that such
New Capital Securities are acquired in the ordinary course of such holder's
business and that such holder is not participating, and has no arrangement or
understanding with any person to participate, in a distribution (within the
meaning of the Securities Act) of such New Capital Securities. However, any
holder of Old Capital Securities who is an "affiliate" of the Company or the
Trust (within the meaning of Rule 405 under the Securities Act) or who intends
to participate in the Exchange Offer for the purpose of distributing New Capital
Securities, or any
3
<PAGE> 5
broker-dealer who purchased Old Capital Securities from the Trust to resell
pursuant to Rule 144A under the Securities Act ("Rule 144A") or any other
available exemption under the Securities Act, (a) will not be able to rely on
the interpretations of the staff of the Division of Corporation Finance of the
Commission set forth in the above-mentioned interpretive letters, (b) will not
be permitted or entitled to tender such Old Capital Securities in the Exchange
Offer and (c) must comply with the registration and prospectus delivery
requirements of the Securities Act in connection with any sale or other transfer
of such Old Capital Securities unless such sale is made pursuant to an exemption
from such requirements. In addition, as described below, if any broker-dealer
holds Old Capital Securities acquired for its own account as a result of
market-making or other trading activities and exchanges such Old Capital
Securities for New Capital Securities, then such broker-dealer must deliver a
prospectus meeting the requirements of the Securities Act in connection with any
resales of such New Capital Securities.
Each holder of Old Capital Securities who wishes to exchange Old Capital
Securities for New Capital Securities in the Exchange Offer will be required to
represent that (i) it is not an "affiliate" of the Company or the Trust, (ii)
any New Capital Securities to be received by it are being acquired in the
ordinary course of its business, (iii) it has no arrangement or understanding
with any person to participate in a distribution (within the meaning of the
Securities Act) of such New Capital Securities, and (iv) such holder is not
engaged in, and does not intend to engage in, a distribution (within the meaning
of the Securities Act) of such New Capital Securities. In addition, the Company
and the Trust may require such holder, as a condition to such holder's
eligibility to participate in the Exchange Offer, to furnish to the Company and
the Trust (or an agent thereof) in writing information as to the number of
"beneficial owners" (within the meaning of Rule 13d-3 under the Securities
Exchange Act of 1934, as amended (the "Exchange Act")) on behalf of whom such
holder holds the Capital Securities to be exchanged in the Exchange Offer. Each
broker-dealer that receives New Capital Securities for its own account pursuant
to the Exchange Offer must acknowledge that it acquired the Old Capital
Securities for its own account as the result of market-making activities or
other trading activities and must agree that it will deliver a prospectus
meeting the requirements of the Securities Act in connection with any resale of
such New Capital Securities. The Letter of Transmittal states that by so
acknowledging and by delivering a prospectus, a broker-dealer will not be deemed
to admit that it is an "underwriter" within the meaning of the Securities Act.
Based on the position taken by the staff of the Division of Corporation Finance
of the Commission in the interpretive letters referred to above, the Company and
the Trust believe that broker-dealers who acquired Old Capital Securities for
their own accounts, as a result of market-making activities or other trading
activities ("Participating Broker-Dealers") may fulfill their prospectus
delivery requirements with respect to the New Capital Securities received upon
exchange of such Old Capital Securities (other than Old Capital Securities which
represent an unsold allotment from the original sale of the Old Capital
Securities) with this Prospectus, as it may be amended or supplemented from time
to time. Subject to certain exceptions, the Company and the Trust have agreed
that this Prospectus, as it may be amended or supplemented from time to time,
may be used by a Participating Broker-Dealer in connection with resales of such
New Capital Securities for a period ending 180 days after the Registration
Statement of which this Prospectus constitutes a part is declared effective. See
"Plan of Distribution." Any Participating Broker-Dealer who is an "affiliate" of
the Trust (within the meaning of Rule 405 under the Securities Act) may not rely
on such interpretive letters and must comply with the registration and
prospectus delivery requirements of the Securities Act in connection with any
resale transaction. See "The Exchange Offer -- Resales of New Capital
Securities."
Any Old Capital Securities not tendered and accepted in the Exchange Offer
will remain outstanding and will be entitled to all the same rights and will be
subject to the same limitations applicable thereto under the Declaration (except
for those rights which terminate upon consummation of the Exchange Offer).
Following consummation of the Exchange Offer, the holders of Old Capital
Securities will not be entitled to any increase in the distribution rate thereon
and will continue to be subject to all of the existing restrictions upon
transfer thereof and neither the Company nor the Trust will have any further
obligation to such holders (other than under certain limited circumstances) to
provide for registration under the Securities Act of the Old Capital Securities
held by them. To the extent that Old Capital Securities are tendered and
accepted in the Exchange Offer, a holder's ability to sell untendered Old
Capital Securities could be adversely affected. See "Risk
Factors -- Consequences of a Failure to Exchange Old Capital Securities."
4
<PAGE> 6
The New Capital Securities will be a new issue of securities for which
there currently is no established trading market. Accordingly, there can be no
assurance as to the development or liquidity of any market for the New Capital
Securities. The Company currently does not intend to apply for listing of the
New Capital Securities on any securities exchange or for quotation through the
National Association of Securities Dealers Automated Quotation System.
Old Capital Securities may be tendered for exchange on or prior to 5:00
p.m., New York City time, on 1997 (such time on such date being
hereinafter called the "Expiration Date"), unless the Exchange Offer is extended
by the Company and the Trust (in which case the term "Expiration Date" shall
mean the latest date and time to which the Exchange Offer is extended). Tenders
of Old Capital Securities may be withdrawn at any time on or prior to the
Expiration Date. The Exchange Offer is not conditioned upon any minimum
liquidation amount of Old Capital Securities being tendered for exchange.
However, the Exchange Offer is subject to certain events and conditions which
may be waived by the Company or the Trust. The Company has agreed to pay all
expenses of the Exchange Offer. See "The Exchange Offer -- Fees and Expenses."
This Prospectus, together with the Letter of Transmittal, is being sent to all
registered holders of Old Capital Securities as of 1997.
Neither the Company nor the Trust will receive any cash proceeds from the
issuance of the New Capital Securities offered hereby. No dealer-manager is
being used in connection with this Exchange Offer. See "Use of Proceeds" and
"Plan of Distribution."
------------------------
5
<PAGE> 7
AVAILABLE INFORMATION
The Company is subject to the informational reporting requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy and information statements and other
information with the Commission. Such material filed by the Company with the
Commission may be inspected by anyone without charge at the Public Reference
Section of the Commission at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549, and at the regional offices of the Commission located at
Northwestern Atrium Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661 and 7 World Trade Center, Suite 1300, New York, New York 10048.
Copies of such material may also be obtained at the Public Reference Section of
the Commission at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 20549, upon payment of prescribed fees.
No separate financial statements of the Trust have been included or
incorporated by reference herein. The Company does not believe such financial
statements would be material to holders of the Capital Securities because (i)
all of the common securities of the Trust will be owned, directly or indirectly,
by the Company, a reporting company under the Exchange Act, (ii) the Trust has
no independent operations but exists for the sole purpose of issuing securities
representing undivided beneficial interests in its assets and investing the
proceeds thereof in Junior Subordinated Debentures issued by the Company, and
(iii) the obligations of the Trust under the Capital Securities are guaranteed
by the Company to the extent described herein. See "Relationship Among the
Capital Securities, the Junior Subordinated Debentures and the Guarantee."
This Prospectus constitutes a part of a registration statement (the
"Registration Statement") filed by the Company and the Trust with the Commission
under the Securities Act. As permitted by the rules and regulations of the
Commission, this Prospectus does not contain all of the information contained in
the Registration Statement and the exhibits and schedules thereto and reference
is hereby made to the Registration Statement and the exhibits and schedules
there to for further information with respect to the Company, the Trust and the
securities offered hereby. Statements contained herein concerning the provisions
of any documents filed as an exhibit to the Registration Statement or otherwise
filed with the Commission are not necessarily complete, and in each instance
reference is made to the copy of such document so filed. Each such statement is
qualified in its entirety by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company's Annual Report on Form 10-K for the fiscal year ended December
31, 1996, the Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1997 and the Company's Current Report on Form 8-K dated March 12,
1997, previously filed by the Company with the Commission, are incorporated by
reference in this Prospectus and shall be deemed to be a part hereof.
Each document filed by the Company with the Commission pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this
Prospectus and prior to the termination of any offering of securities made by
this Prospectus shall be deemed to be incorporated by reference herein and to be
a part hereof from the date of filing of such document. Any statement contained
herein, or in a document all or a portion of which is incorporated or deemed to
be incorporated by a reference herein, shall be deemed to be modified or
superseded for purposes of the Registration Statement and this Prospectus to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of the Registration Statement or this Prospectus.
THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WHICH ARE NOT INCLUDED
HEREIN OR DELIVERED HEREWITH. THESE DOCUMENTS ARE AVAILABLE WITHOUT CHARGE UPON
WRITTEN OR ORAL REQUEST FROM THE COMPANY'S TREASURY DIVISION, 425 WALNUT STREET,
CINCINNATI, OHIO 45202, TELEPHONE NUMBER (513) 632-4000. IN ORDER TO ENSURE
TIMELY DELIVERY OF SUCH DOCUMENTS, ANY REQUEST SHOULD BE MADE AT LEAST FIVE
BUSINESS DAYS PRIOR TO THE EXPIRATION DATE.
6
<PAGE> 8
PROSPECTUS SUMMARY
This summary is qualified by the more detailed information and financial
statements appearing elsewhere, or incorporated by reference, in this
Prospectus. Holders of Old Capital Securities are urged to read this Prospectus
in its entirety.
THE COMPANY
The Company is organized under the laws of the State of Ohio and maintains
its executive offices in Cincinnati, Ohio. The Company is a bank holding company
(under the Bank Holding Company Act of 1956, as amended) registered with the
Federal Reserve, and accordingly, is subject to regulation and examination by
the Federal Reserve.
As a result of a 1993 and 1996 restructuring of certain of its Ohio,
Kentucky and Indiana banks, the Company presently directly holds one
wholly-owned national bank subsidiary: Star Bank, N.A. (the "Bank"). Through the
Bank and its 278 banking offices, the Company engages in the commercial banking
and trust business and provides a full range of consumer, wholesale, commercial,
trust and investment products (including, but not limited to, deposits,
individual retirement accounts, and mutual funds) and investment services in
Ohio, Kentucky and Indiana. The Bank offers corporate loans, commercial leasing,
commercial and residential mortgages, real estate construction lending, and a
variety of consumer loan products (including installment loans, credit cards and
retail leasing). None of the foregoing types of loans exceeds 30% of the Bank's
diversified loan portfolio. The Bank also offers cash management and
international trade services to commercial clients.
The Company has expanded significantly by acquisition in the last five
years. Since 1992, the Company, in three separate transactions, has purchased 24
branch offices in the Columbus, Ohio area, 47 branch offices in the Cleveland
and Akron, Ohio areas, and 28 additional branches in the Cleveland, Ohio area;
and, on July 26, 1996, the Bank acquired 5 additional branches in Indiana. Most
recently, on February 14, 1997 the Bank acquired 7 branch offices in the
Southwestern Ohio area from Amerifirst Bank, N.A. The Company continues to
explore other acquisition opportunities in its market area.
The Company's other active subsidiaries include: Miami Valley Insurance
Company, an Arizona company engaged solely in the business of issuing credit
life and accident and health insurance in connection with the lending activities
of the Company's Ohio and Indiana branch offices; First National Cincinnati
Company, a subsidiary of the Bank that owns and operates the Company's
headquarters building; and Star Banc Finance, Inc., a consumer finance company
regulated by the Federal Reserve Board that offers a broad mix of credit
products and services, including direct and indirect auto loans, second
mortgages and personal loans; and Star Capital Corporation, an Ohio company
engaged in the business of making investments in securities and other property
permissible for Bank Holding Companies and subsidiaries.
The Company's executive offices are located at 425 Walnut Street,
Cincinnati, Ohio 45202 and its telephone number is (513) 632-4000.
THE EXCHANGE OFFER
The Exchange Offer......... Up to $150,000,000 aggregate liquidation amount of
New Capital Securities are being offered in
exchange for a like aggregate liquidation amount of
Old Capital Securities. The Company will issue,
promptly after the Expiration Date, $1,000
liquidation amount of New Capital Securities in
exchange for each $1,000 liquidation amount of
outstanding Old Capital Securities tendered and
accepted in connection with the Exchange Offer. For
a description of the procedures for tendering Old
Capital Securities, see "The Exchange
Offer -- Procedures for Tendering Old Capital
Securities."
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<PAGE> 9
Expiration Date............ 5:00 p.m., New York City time, on
, 1997 (such time on such date being hereinafter
called the "Expiration Date") unless the Exchange
Offer is extended by the Company and the Trust (in
which case the term "Expiration Date" shall mean
the latest date and time to which the Exchange
Offer is extended). See "The Exchange Offer --
Expiration Date; Extensions; Amendments."
Withdrawal Rights.......... Tenders of Old Capital Securities may be withdrawn
at any time on or prior to the Expiration Date by
delivering a written notice of such withdrawal to
the Exchange Agent in conformity with certain
procedures set forth below under "The Exchange
Offer -- Withdrawal Rights."
Procedures for Tendering
Old Capital Securities... Tendering holders of Old Capital Securities must
complete and sign a Letter of Transmittal in
accordance with the instructions contained therein
and forward the same by mail, facsimile or hand
delivery, together with any other required
documents, to the Exchange Agent, either with the
Old Capital Securities to be tendered or in
compliance with the specified procedures for
guaranteed delivery of Old Capital Securities.
Certain brokers, dealers, commercial banks, trust
companies and other nominees may also effect
tenders by book-entry transfer, including an
Agent's Message if the tendering holder does not
deliver a Letter of Transmittal. Holders of Old
Capital Securities registered in the name of a
broker, dealer, commercial bank, trust company or
other nominee are urged to contact such person
promptly if they wish to tender Old Capital
Securities pursuant to the Exchange Offer. See "The
Exchange Offer -- Procedures for Tendering Old
Capital Securities."
Letters of Transmittal and certificates
representing Old Capital Securities should not be
sent to the Company or the Trust. Such documents
should only be sent to the Exchange Agent.
Questions regarding how to tender and requests for
information should be directed to the Exchange
Agent. See "The Exchange Offer -- Exchange Agent."
Resales of New Capital
Securities............... The Company and the Trust are making the Exchange
Offer in reliance on the position of the staff of
the Division of Corporation Finance of the
Commission as set forth in certain interpretive
letters addressed to third parties in other
transactions. However, neither the Company nor the
Trust has sought its own interpretive letter and
there can be no assurance that the staff of the
Division of Corporation Finance of the Commission
would make a similar determination with respect to
the Exchange Offer as it has in such interpretive
letters to third parties. Based on these
interpretations by the staff of the Division of
Corporation Finance, and subject to the two
immediately following sentences, the Company and
the Trust believe that New Capital Securities
issued pursuant to this Exchange Offer in exchange
for Old Capital Securities may be offered for
resale, resold and otherwise transferred by a
holder thereof (other than a holder who is a
broker-dealer) without further compliance with the
registration and prospectus delivery requirements
of the Securities Act, provided that such New
Capital Securities are acquired in the ordinary
course of such holder's business and that such
holder is not participating, and has no arrangement
or understanding with any person to participate, in
a distribution (within the meaning of the
Securities Act) of such New Capital Securities.
However, any holder of Old
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<PAGE> 10
Capital Securities who is an "affiliate" of the
Company or the Trust or who intends to participate
in the Exchange Offer for the purpose of
distributing the New Capital Securities, or any
broker-dealer who purchased the Old Capital
Securities from the Trust to resell pursuant to
Rule 144A or any other available exemption under
the Securities Act, (a) will not be able to rely on
the interpretations of the staff of the Division of
Corporation Finance of the Commission set forth in
the above-mentioned interpretive letters, (b) will
not be permitted or entitled to tender such Old
Capital Securities in the Exchange Offer and (c)
must comply with the registration and prospectus
delivery requirements of the Securities Act in
connection with any sale or other transfer of such
Old Capital Securities unless such sale is made
pursuant to an exemption from such requirements. In
addition, as described below, if any broker-dealer
holds Old Capital Securities acquired for its own
account as a result of market-making or other
trading activities and exchanges such Old Capital
Securities for New Capital Securities, then such
broker-dealer must deliver a prospectus meeting the
requirements of the Securities Act in connection
with any resales of such New Capital Securities.
Each holder of Old Capital Securities who wishes to
exchange Old Capital Securities for New Capital
Securities in the Exchange Offer will be required
to represent that (i) it is not an "affiliate" of
the Company or the Trust, (ii) any New Capital
Securities to be received by it are being acquired
in the ordinary course of its business, (iii) it
has no arrangement or understanding with any person
to participate in a distribution (within the
meaning of the Securities Act) of such New Capital
Securities, and (iv) such holder is not engaged in,
and does not intend to engage in, a distribution
(within the meaning of the Securities Act) of such
New Capital Securities. Each broker-dealer that
receives New Capital Securities for its own account
pursuant to the Exchange Offer must acknowledge
that it acquired the Old Capital Securities for its
own account as the result of market-making
activities or other trading activities and must
agree that it will deliver a prospectus meeting the
requirements of the Securities Act in connection
with any resale of such New Capital Securities. The
Letter of Transmittal states that by so
acknowledging and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it
is an "underwriter" within the meaning of the
Securities Act. Based on the position taken by the
staff of the Division of Corporation Finance of the
Commission in the interpretive letters referred to
above, the Company and the Trust believe that
broker-dealers who acquired Old Capital Securities
for their own accounts, as a result of
market-making activities or other trading
activities ("Participating Broker-Dealers"), may
fulfill their prospectus delivery requirements with
respect to the New Capital Securities received upon
exchange of such Old Capital Securities (other than
Old Capital Securities which represent an unsold
allotment from the original sale of the Old Capital
Securities) with this Prospectus, as it may be
amended or supplemented from time to time. Subject
to certain limitations described below under "The
Exchange Offer -- Resale of New Capital
Securities," the Company has agreed that this
Prospectus, as it may be amended or supplemented
from time to time, may be used by a Participating
Broker-Dealer in connection with resales of such
New Capital Securities for a period
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<PAGE> 11
ending 180 days after the Registration Statement of
which this Prospectus constitutes a part is
declared effective. See "Plan of Distribution." Any
Participating Broker-Dealer who is an "affiliate"
of the Company may not rely on such interpretive
letters and must comply with the registration and
prospectus delivery requirements of the Securities
Act in connection with any resale transaction. See
"The Exchange Offer -- Resales of New Capital
Securities."
Accrued Distributions...... Each New Capital Security will pay cumulative
Distributions from the most recent Distribution
Date or, if no Distributions have been paid on such
Old Capital Securities, from June 8, 1997. Holders
of the Old Capital Securities whose Old Capital
Securities are accepted for exchange will not
receive any accumulated Distributions on such Old
Capital Securities and will be deemed to have
waived the right to receive any Distributions on
such Old Capital Securities accumulated from and
after June 8, 1997.
Conditions to the Exchange
Offer.................... The Exchange Offer is subject to certain
conditions, which may be waived by the Company and
the Trust in their sole discretion. The Exchange
Offer is not conditioned upon any minimum
liquidation amount of Old Capital Securities being
tendered. See "The Exchange Offer -- Conditions to
the Exchange Offer."
Exchange Agent............. The exchange agent with respect to the Exchange
Offer is The First National Bank of Chicago (the
"Exchange Agent"). The addresses, and telephone and
facsimile numbers, of the Exchange Agent are set
forth below under "The Exchange Offer -- Exchange
Agent" and in the Letter of Transmittal.
Use of Proceeds............ Neither the Company nor the Trust will receive any
cash proceeds from the issuance of the New Capital
Securities offered hereby. The New Capital
Securities will be exchanged for Old Capital
Securities in like liquidation amount, which will
be retired and cancelled. The cash proceeds from
the sale of the Old Capital Securities were used to
purchase Old Junior Subordinated Debentures. See
"Use of Proceeds."
Certain United States
Federal
Income Tax
Considerations........... Holders of Old Capital Securities should review the
information set forth under "Certain United States
Federal Income Tax Considerations" prior to
tendering Old Capital Securities in the Exchange
Offer.
Consequences of Failure to
Exchange................. Any Old Capital Securities not tendered and
accepted in the Exchange Offer will remain
outstanding and will be entitled to all the same
rights and will be subject to the same limitations
applicable thereto under the Declaration (except
for those rights which terminate upon consummation
of the Exchange Offer). Following consummation of
the Exchange Offer, the holders of Old Capital
Securities will not be entitled to any increase in
the distribution rate thereon and will continue to
be subject to all of the existing restrictions upon
transfer thereof and neither the Company nor the
Trust will have any further obligation to such
holders (other than under certain limited
circumstances) to provide for registration under
the Securities Act of the Old Capital Securities
held by them. To the extent that Old Capital
Securities are tendered and accepted in the
Exchange Offer, a holder's ability to sell
untendered Old Capital
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<PAGE> 12
Securities could be adversely affected. See "Risk
Factors --
Consequences of a Failure to Exchange Old Capital
Securities."
THE NEW SECURITIES
The Trust.................. Star Capital I, a Delaware statutory business
trust. The sole assets of the Trust are the Junior
Subordinated Debentures.
Securities Offered......... Up to $150,000,000 aggregate liquidation amount of
the Trust's Floating Rate Capital Securities which
have been registered under the Securities Act
(liquidation amount $1,000 per Capital Security).
The terms of the New Capital Securities are
identical in all material respects to the terms of
the Old Capital Securities, except that the New
Capital Securities have been registered under the
Securities Act and therefore are not subject to
certain restrictions on transfer applicable to the
Old Capital Securities and will not provide for any
increase in the distribution rate thereon or any
further registration rights under the Securities
Act, except in certain limited circumstances. See
"The Exchange Offer -- Purpose and Effect of the
Exchange Offer", "Description of Capital
Securities" and "Description of the Old
Securities." The holders of the New Capital
Securities will be entitled to a preference in
certain circumstances with respect to distributions
and amounts payable on liquidation, redemption or
otherwise over the Common Securities.
Distributions.............. Holders of the New Capital Securities will be
entitled to receive cumulative cash distributions
at a variable annual rate equal to LIBOR plus
0.765% of the liquidation amount of $1,000 per
Capital Security, accruing from the date of
original issuance and payable quarterly in arrears
on the fifteenth day of March, June, September and
December of each year commencing on September 15,
1997. The distribution rate and the distribution
and other payment dates for the New Capital
Securities will correspond to the interest rate and
interest and other payment dates on the Junior
Subordinated Debentures. See "Description of
Capital Securities."
Junior Subordinated
Debentures............... The Trust has invested the proceeds from the
issuance of the Old Capital Securities and Common
Securities in an equivalent amount of Old Floating
Rate Junior Subordinated Debentures of the Company.
The Junior Subordinated Debentures mature on June
15, 2027 (the "Stated Maturity"). The Junior
Subordinated Debentures will rank subordinate and
junior in right of payment to all Indebtedness of
the Company. In addition, the Company's obligations
under the Junior Subordinated Debentures are
structurally subordinated to all existing and
future liabilities and obligations of its
subsidiaries. See "Risk Factors -- Ranking of
Subordinated Obligations Under the Guarantee and
the Junior Subordinated Debentures," "Risk
Factors -- Status of Company as Holding Company"
and "Description of Junior Subordinated
Debentures -- Subordination."
Guarantee.................. Payment of distributions out of moneys held by the
Trust, and payments on liquidation of the Trust or
the redemption of Capital Securities, are
guaranteed by the Company to the extent the Trust
has funds available therefor. If the Company does
not make principal or interest payments on the
Junior Subordinated Debentures, the Trust will not
have sufficient
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<PAGE> 13
funds to make distributions on the Capital
Securities, in which event the Guarantee shall not
apply to such distribution until the Trust has
sufficient funds available therefor. The Company's
obligations under the Guarantee, taken together
with its obligations under the Junior Subordinated
Debentures and the Indenture, including its
obligation to pay all costs, expenses and
liabilities of the Trust (other than with respect
to the Capital Securities), constitute a full and
unconditional guarantee of all of the Trust's
obligations under the Capital Securities. See
"Description of Guarantee" and "Relationship Among
the Capital Securities, the Junior Subordinated
Debentures and the Guarantee." The obligations of
the Company under the Guarantee are subordinate and
junior in right of payment to all Indebtedness of
the Company. See "Risk Factors -- Ranking of
Subordinated Obligations Under the Guarantee and
the Junior Subordinated Debentures" and
"Description of Guarantee."
Right to Defer Interest.... The Company has the right to defer payment of
interest on the Junior Subordinated Debentures by
extending the interest payment period on the Junior
Subordinated Debentures, from time to time, for up
to 20 consecutive quarterly periods. There could be
multiple Extension Periods of varying lengths
throughout the term of the Junior Subordinated
Debentures. If interest payments on the Junior
Subordinated Debentures are so deferred,
distributions on the Capital Securities will also
be deferred for an equivalent period and the
Company may not, and may not permit any subsidiary
of the Company to, subject to certain exceptions
set forth herein, (i) declare or pay any dividends
or distributions on, or redeem, purchase, acquire,
or make a liquidation payment with respect to, the
Company's capital stock or (ii) make any payment of
principal, interest or premium, if any, on or
repay, repurchase or redeem any debt securities
that rank pari passu with or junior to the Junior
Subordinated Debentures or make any guarantee
payments with respect to any guarantee by the
Company of the debt securities of any subsidiary of
the Company if such guarantee ranks pari passu with
or junior to the Junior Subordinated Debentures
(other than (a) repurchases, redemptions or other
acquisitions of shares of capital stock of the
Company in connection with any employment contract,
benefit plan or other similar arrangement with or
for the benefit of any one or more employees,
officers, directors or consultants or in connection
with a dividend reinvestment or stockholder stock
purchase plan, (b) as a result of an exchange or
conversion of any class or series of the Company's
capital stock (or any capital stock of a subsidiary
of the Company) for any class or series of the
Company's capital stock or of any class or series
of the Company's indebtedness for any class or
series of the Company's capital stock, (c) 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, (d) any
declaration of a dividend in connection with the
adoption of any stockholder's rights plan, or the
issuance of rights, stock or other property under
any stockholder's rights plan, or the redemption or
repurchase of rights pursuant thereto, or (e) any
dividend in the form of stock, warrants, options or
other rights where the dividend stock or the stock
issuable upon exercise of such warrants, options or
other rights is the same stock as that on which the
dividend is being paid or ranks pari passu with or
junior to such stock). During an Extension Period,
interest
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<PAGE> 14
on the Junior Subordinated Debentures will continue
to accrue (and the amount of Distributions to which
holders of the Capital Securities are entitled will
accumulate) at a variable rate of LIBOR plus 0.765%
per annum, compounded quarterly. During an
Extension Period, holders of Capital Securities
will be required to include their allocable share
of the stated interest on the Junior Subordinated
Debentures in gross income as original issue
discount ("OID") even though the cash payments
attributable thereto have not been made. See
"Description of Junior Subordinated
Debentures -- Option to Extend Interest Payment
Period" and "Certain United States Federal Income
Tax Consequences -- Interest Income and Original
Issue Discount."
Redemption................. The Junior Subordinated Debentures are redeemable
by the Company in whole or in part on or after June
15, 2007, or at any time in whole upon the
occurrence of a Special Event, in either case
subject to any necessary prior approval of the
Federal Reserve. If the Junior Subordinated
Debentures are redeemed, the Trust must redeem
Trust Securities (as hereinafter defined) having an
aggregate liquidation amount equal to the aggregate
principal amount of the Junior Subordinated
Debentures so redeemed. The Trust Securities will
be redeemed upon maturity of the Junior
Subordinated Debentures. See "Description of
Capital Securities -- Redemption -- Mandatory
Redemption" and "-- Special Event Redemption or
Distribution of Junior Subordinated Debentures."
Liquidation of the Trust... Upon the occurrence and continuation of a Special
Event, the Company will have the right, subject to
any necessary prior approval of the Federal
Reserve, to terminate the Trust and cause the
Junior Subordinated Debentures to be distributed to
the holders of the Capital Securities and the
Common Securities in liquidation of the Trust. See
"Description of Capital
Securities -- Redemption -- Special Event
Redemption or Distribution of Junior Subordinated
Debentures."
In the event of the liquidation of the Trust, after
satisfaction of the claims of creditors of the
Trust, if any, as provided by applicable law, the
holders of the Capital Securities will be entitled
to receive a liquidation amount of $1,000 per
Capital Security plus accumulated and unpaid
Distributions thereon to the date of payment, which
may be in the form of a distribution of such amount
in Junior Subordinated Debentures as described
above. If such Liquidation Distribution can be paid
only in part because the Trust has insufficient
assets available to pay in full the aggregate
Liquidation Distribution, then the amounts payable
directly by the Trust on the Capital Securities
shall be paid on a pro rata basis. The holder of
the Common Securities will be entitled to receive
distributions upon any such liquidation pro rata
with the holders of the Capital Securities, except
that if an Indenture Event of Default has occurred
and is continuing, the Capital Securities shall
have a priority over the Common Securities. See
"Description of Capital Securities -- Liquidation
Distribution Upon Dissolution."
Ratings.................... The New Capital Securities have been rated "a3" by
Moody's Investors Service, Inc. ("Moody's") and
"BBB" by Standard & Poor's Ratings Services
("S&P"). A security rating is not a recommendation
to buy, sell or hold securities and may be subject
to revision or withdrawal at any time by the
assigning rating organization.
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<PAGE> 15
Absence of Market for the
New Capital Securities... The New Capital Securities will be a new issue of
securities for which there currently is no
established trading market. Accordingly, there can
be no assurance as to the development or liquidity
of any market for the New Capital Securities. The
Company currently does not intend to apply for
listing of the New Capital Securities on any
securities exchange or for quotation through the
National Association of Securities Dealers
Automated Quotation System.
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<PAGE> 16
RISK FACTORS
Prospective purchasers of the New Capital Securities should carefully
review the information contained elsewhere in this Prospectus and should
particularly consider the following matters. To the extent any of the
information contained or incorporated by reference in this Prospectus
constitutes a "forward-looking statement" as defined in Section 21E(i)(1) of the
Exchange Act, the risk factors set forth below are cautionary statements
identifying important factors that could cause actual results to differ
materially from those in the forward-looking statement.
RANKING OF SUBORDINATED OBLIGATIONS UNDER THE GUARANTEE AND THE JUNIOR
SUBORDINATED DEBENTURES
The obligations of the Company under the Guarantee issued by the Company
for the benefit of the holders of Capital Securities and under the Junior
Subordinated Debentures are unsecured and rank subordinate and junior in right
of payment to all Indebtedness of the Company. At June 30, 1997, the
Indebtedness of the Company aggregated approximately $152 million. Neither the
Indenture, the Guarantee nor the Declaration (as defined herein) place any
limitation on the amount of secured or unsecured Indebtedness that may be
incurred by the Company. See "Description of Guarantee -- Status of the
Guarantee" and "Description of Junior Subordinated Debentures -- Subordination."
STATUS OF COMPANY AS HOLDING COMPANY
As a holding company, the ability of the Company to make payments of
interest and principal on the Junior Subordinated Debentures will be dependent
primarily upon the receipt of dividends and other distributions from the
Company's subsidiaries. The Company's principal subsidiary is the Bank. There
are various regulatory restrictions on the ability of the Bank to pay dividends
or make other payments to the Company. At June 30, 1997, the Bank could pay an
aggregate of $157 million in dividends to the Company without prior regulatory
approval. In addition, the right of the Company to participate in any
distribution of assets of any subsidiary, including the Bank, 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),
will be subject to the prior claims of creditors of that subsidiary, except to
the extent that any claims of the Company as a creditor of such subsidiary may
be recognized as such. Accordingly, the Capital Securities will effectively be
subordinated to all existing and future liabilities of the Company's
subsidiaries, and holders of the Capital Securities should look only to the
assets of the Company for payments on the Capital Securities. As of June 30,
1997, the Company's consolidated subsidiaries had indebtedness and other
liabilities of approximately $9.9 billion.
ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF CAPITAL SECURITIES
If a Trust Enforcement Event (as defined herein) occurs and is continuing,
then the holders of Capital Securities would rely on the enforcement by the
Property Trustee (as defined herein) of its rights as a holder of the Junior
Subordinated Debentures against the Company. 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 Property Trustee or to direct the exercise of any trust or power conferred
upon the Property Trustee under the Declaration (as defined herein), including
the right to direct the Property Trustee to exercise the remedies available to
it as a holder of the Junior Subordinated Debentures. If the Property Trustee
fails to enforce its rights with respect to the Junior Subordinated Debentures
held by the Trust, any record holder of Capital Securities may institute legal
proceedings directly against the Company to enforce the Property Trustee's
rights under such Junior Subordinated Debentures without first instituting any
legal proceedings against such Property Trustee or any other person or entity.
If the Company were to default on its obligation to pay amounts payable
under the Junior Subordinated Debentures, the Trust would lack 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
would not be able to rely upon the Guarantee for payment of such amounts.
However, in the event the Company failed to pay interest on or principal of the
Junior Subordinated Debentures on the payment date on which such payment is
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<PAGE> 17
due and payable, then a holder of Capital Securities may directly institute a
proceeding against the Company for enforcement of payment to such holder of the
interest on or principal of Junior Subordinated Debentures having a principal
amount equal to the aggregate liquidation amount of the Capital Securities of
such holder (a "Direct Action"). In connection with such Direct Action, the
Company will be subrogated to the rights of such holder of Capital Securities
under the Declaration to the extent of any payment made by the Company to such
holder of Capital Securities in such Direct Action. Except as set forth herein,
holders of Capital Securities will not be able to exercise directly any other
remedy available to the holders of Junior Subordinated Debentures or assert
directly any other rights in respect of the Junior Subordinated Debentures. See
"Description of Capital Securities -- Enforcement of Certain Rights by Holders
of Capital Securities," "Description of Guarantee" and "Description of Junior
Subordinated Debentures -- Indenture Events of Default." The Declaration
provides that each holder of Capital Securities by acceptance thereof agrees to
the provisions of the Guarantee and the Indenture.
OPTION TO EXTEND INTEREST PAYMENT PERIOD; TAX CONSEQUENCES
The Company has 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, provided that no
Extension Period may extend beyond the Stated Maturity of the Junior
Subordinated Debentures. As a consequence of any such deferral, quarterly
Distributions on the Capital Securities by the Trust would be deferred but would
continue to accumulate at a variable rate of LIBOR plus 0.765% per annum,
compounded quarterly during any such Extension Period. During any such Extension
Period, the Company may not, and may not permit any subsidiary of the Company
to, (i) declare or pay any dividends or distributions on, or redeem, purchase,
acquire, or make a liquidation payment with respect to, any of the Company's
capital stock or (ii) make any payment of principal, interest or premium, if
any, on or repay, repurchase or redeem any debt securities of the Company that
rank pari passu with or junior to the Junior Subordinated Debentures or make any
guarantee payments with respect to any guarantee by the Company of the debt
securities of any subsidiary of the Company if such guarantee ranks pari passu
with or junior to the Junior Subordinated Debentures (other than (a)
repurchases, redemptions or other acquisitions of shares of capital stock of the
Company in connection with any employment contract, benefit plan or other
similar arrangement with or for the benefit of any one or more employees,
officers, directors or consultants or in connection with a dividend reinvestment
or stockholder stock purchase plan, (b) as a result of an exchange or conversion
of any class or series of the Company's capital stock (or any capital stock of a
subsidiary of the Company) for any class or series of the Company's capital
stock or of any class or series of the Company's indebtedness for any class or
series of the Company's capital stock, (c) 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,
(d) any declaration of a dividend in connection with the adoption of any
stockholder's rights plan, or the issuance of rights, stock or other property
under any stockholder's rights plan, or the redemption or repurchase of rights
pursuant thereto, or (e) any dividend in the form of stock, warrants, options or
other rights where the dividend stock or the stock issuable upon exercise of
such warrants, options or other rights is the same stock as that on which the
dividend is being paid or ranks pari passu with or junior to such stock). Prior
to the termination of any such Extension Period, the Company may further extend
the Extension Period, provided that no Extension Period may exceed 20
consecutive quarterly periods or extend beyond the Stated Maturity of the Junior
Subordinated Debentures. Upon the termination of any Extension Period and the
payment of all amounts then due on any Interest Payment Date, the Company may
elect to begin a new Extension Period subject to the above requirements. See
"Description of Capital Securities -- Distributions" and "Description of Junior
Subordinated Debentures -- Option to Extend Interest Payment Period."
Should the Company defer payment of interest on the Junior Subordinated
Debentures, a holder of Capital Securities will be required to accrue income (in
the form of OID) for United States federal income tax purposes in respect of its
pro rata share of the Junior Subordinated Debentures held by the Trust. As a
result, a holder of Capital Securities will be required to include such holder's
allocable share of the stated interest on the Junior Subordinated Debentures in
gross income for United States federal income tax purposes in advance of the
receipt of cash attributable to such income, and will not receive the cash
related to such
16
<PAGE> 18
income from the Trust if the holder disposes of the Capital Securities prior to
the record date for the payment of Distributions with respect to such Extension
Period. See "Certain United States Federal Income Tax Consequences -- Interest
Income and Original Issue Discount" and " -- Sales of Capital Securities."
The Company has no current intention of exercising its right to defer
payments of interest by extending the interest payment period on the Junior
Subordinated Debentures. However, should the Company elect to exercise such
right in the future, the market price of the Capital Securities is likely to be
adversely 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, as a
result of the existence of the Company's right to defer interest payments, the
market price of the Capital Securities (which represent preferred undivided
beneficial interests in the Junior Subordinated Debentures) may be more volatile
than the market prices of other similar securities where the issuer does not
have such right to defer interest payments.
SPECIAL EVENT REDEMPTION
Upon the occurrence and continuation of a Special Event, the Company has
the right, subject to any necessary prior approval of the Federal Reserve, to
redeem the Junior Subordinated Debentures in whole (but not in part) at the
redemption price described in the Indenture within 90 days following the
occurrence of such Special Event and thereby cause a mandatory redemption of the
Capital Securities and Common Securities. A "Special Event" means a Tax Event, a
Regulatory Capital Event or an Investment Company Event (each as defined
herein).
LIQUIDATION DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES
Upon the occurrence and continuation of a Special Event the Company will
have the right, subject to any necessary prior approval of the Federal Reserve,
to terminate the Trust and cause the Junior Subordinated Debentures to be
distributed to the holders of the Capital Securities and the Common Securities
in liquidation of the Trust. In addition, upon liquidation of the Trust and
certain other events, the Junior Subordinated Debentures may be distributed to
such holders. Under current United States federal income tax law and
interpretations thereof and assuming, as expected, the Trust is treated as a
grantor trust for United States federal income tax purposes, a distribution by
the Trust of the Junior Subordinated Debentures pursuant to a liquidation of the
Trust will not be a taxable event to the Trust or to holders of the Capital
Securities and will result in a holder of the Capital Securities receiving
directly such holder's pro rata share of the Junior Subordinated Debentures
(previously held indirectly through the Trust). If, however, the liquidation of
the Trust were to occur because the Trust is subject to United States federal
income tax with respect to income accrued or received on the Junior Subordinated
Debentures as a result of the occurrence of a Tax Event or otherwise, the
distribution of Junior Subordinated Debentures to holders of the Capital
Securities by the Trust could be a taxable event to the Trust and each holder,
and holders of the Capital Securities could then be required to recognize gain
or loss as if they had exchanged their Capital Securities for the Junior
Subordinated Debentures they received upon the liquidation of the Trust. See
"Certain United States Federal Income Tax Consequences -- Distribution of Junior
Subordinated Debentures or Cash Upon Liquidation of the Trust."
There can be no assurance as to the market prices for Capital Securities or
Junior Subordinated Debentures that may be distributed in exchange for Capital
Securities if a liquidation of the Trust occurs. Accordingly, the Capital
Securities that an investor may purchase, whether pursuant to the offer made
hereby or in the secondary market, or the Junior Subordinated Debentures that a
holder of Capital Securities may receive on liquidation of the Trust, may trade
at a discount to the price that the investor paid to purchase the Capital
Securities offered hereby. Because holders of Capital Securities may receive
Junior Subordinated Debentures on termination of the Trust, 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 Capital Securities -- Redemption -- Special Event Redemption or
Distribution of Junior Subordinated Debentures" and "Description of Junior
Subordinated Debentures -- General."
17
<PAGE> 19
LIMITED VOTING RIGHTS
Holders of New Capital Securities generally will have limited voting rights
relating only to the modification of the New Capital Securities and certain
other matters described herein. Holders of New Capital Securities will not be
entitled to vote to appoint, remove or replace any of the Trustees (as defined
below), which voting rights are vested exclusively in the holder of the Common
Securities. The Trustees and the Company may amend the Declaration without the
consent of holders of Capital Securities to ensure that the Trust will be
classified as a grantor trust for United States federal income tax purposes,
unless such action would materially and adversely affect the interests of such
holders. See "Description of Capital Securities -- Voting Rights; Amendment of
the Declaration" and "-- Removal of Trustees."
CONSEQUENCES OF A FAILURE TO EXCHANGE OLD CAPITAL SECURITIES
The Old Capital Securities have not been registered under the Securities
Act or any state securities laws and therefore may not be offered, sold or
otherwise transferred except in compliance with the registration requirements of
the Securities Act and any other applicable securities laws, or pursuant to an
exemption therefrom or in a transaction not subject thereto, and in each case in
compliance with certain other conditions and restrictions. Old Capital
Securities that remain outstanding after consummation of the Exchange Offer will
continue to bear a legend reflecting such restrictions on transfer. In addition,
upon consummation of the Exchange Offer, holders of Old Capital Securities that
remain outstanding will not be entitled to any increase in the distribution rate
thereon or any rights to have such Old Capital Securities registered under the
Securities Act by the Company (subject to certain limited exceptions). The
Company and the Trust do not intend to register under the Securities Act any Old
Capital Securities that remain outstanding after consummation of the Exchange
Offer (subject to such limited exceptions, if applicable).
The Old Capital Securities were issued to, and the Company believes are
currently owned by, a small number of beneficial owners. To the extent that Old
Capital Securities are tendered and accepted in connection with the Exchange
Offer, any trading market for Old Capital Securities that remain outstanding
after the Exchange Offer could be adversely affected.
ABSENCE OF PUBLIC MARKET FOR NEW CAPITAL SECURITIES
Although the New Capital Securities will generally be permitted to be
resold or otherwise transferred by the holders (who are not affiliates of the
Company or the Trust) without compliance with the registration requirements
under the Securities Act, they will constitute a new issue of securities with no
established trading market. Accordingly, no assurance can be given that an
active public or other market will develop for the New Capital Securities or as
to the liquidity of or the trading market for the New Capital Securities. The
Company currently does not intend to apply for listing of the New Capital
Securities on any securities exchange or for quotation through the National
Association of Securities Dealers Automated Quotation System. If an active
public market does not develop, the market price and liquidity of the New
Capital Securities may be adversely affected.
If a public trading market develops for the New Capital Securities, future
trading prices of such securities will depend on many factors, including, among
other things, prevailing interest rates, results of operations and the market
for similar securities. Depending on prevailing interest rates, the market for
similar securities and other factors, including the financial condition of the
Company, the New Capital Securities may trade at a discount.
Each broker-dealer that receives New Capital Securities for its own account
in exchange for Old Capital Securities, where such Old Capital Securities were
acquired by such broker-dealer as a result of market-making activities or other
trading activities, must acknowledge that it will deliver a prospectus in
connection with any resale of such New Capital Securities. See "Plan of
Distribution."
18
<PAGE> 20
EXCHANGE OFFER PROCEDURES
Issuance of the New Capital Securities in exchange for Old Capital
Securities pursuant to the Exchange Offer will be made only after a timely
receipt by the Trust of such Old Capital Securities, a properly completed and
duly executed Letter of Transmittal and all other required documents. Therefore,
holders of the Old Capital Securities desiring to tender such Old Capital
Securities in exchange for New Capital Securities should allow sufficient time
to ensure timely delivery. The Trust is under no duty to give notification of
defects or irregularities with respect to the tenders of Old Capital Securities
for exchange.
USE OF PROCEEDS
Neither the Company nor the Trust will receive any cash proceeds from the
issuance of the New Capital Securities offered hereby. The New Capital
Securities will be exchanged for Old Capital Securities of like aggregate
liquidation amount, which will be retired and cancelled. The cash proceeds from
the sale of the Old Capital Securities were used to purchase Old Junior
Subordinated Debentures. The Company intends to use the proceeds from the sale
of the Old Junior Subordinated Debentures for general corporate purposes, which
may include the repurchase of common equity of the Company, the repayment of
indebtedness, investments in or extensions of credit to its subsidiaries and the
financing of possible acquisitions. Pending such use, the net proceeds may be
temporarily invested in short-term obligations. The precise amounts and timing
of the application of proceeds will depend upon the funding requirements of the
Company and its subsidiaries and the availability of other funds.
RATIO OF EARNINGS TO FIXED CHARGES AND RATIO OF EARNINGS TO
COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
The Company's consolidated ratios of earnings to fixed charges and
consolidated ratios of earnings to combined fixed charges and preferred stock
dividend requirements for each of the periods indicated are set forth below:
<TABLE>
<CAPTION>
SIX MONTHS YEAR ENDED DECEMBER 31,
ENDED ---------------------------------
JUNE 30, 1997 1996 1995 1994 1993 1992
------------- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C>
Earnings to Fixed Charges:
Excluding Interest on Deposits..................... 5.04 5.17 3.98 4.62 6.77 5.50
Including Interest on Deposits..................... 1.84 1.75 1.61 1.79 1.77 1.48
Earnings to Combined Fixed Charges and Preferred
Stock Dividend Requirements:
Excluding Interest on Deposits..................... 5.04 5.17 3.97 4.58 6.43 5.21
Including Interest on Deposits..................... 1.84 1.75 1.61 1.79 1.77 1.48
</TABLE>
For purposes of computing the ratios of both earnings to fixed charges and
earnings to combined fixed charges and preferred stock dividend requirements,
earnings represent net income plus applicable income taxes and fixed charges.
Fixed charges, excluding interest on deposits, represent interest expense
(except interest on deposits), capitalized interest, and the interest factor
included in rents. Fixed charges, including interest on deposits, represent all
interest expense, capitalized interest, and the interest factor included in
rents. Combined fixed charges and preferred stock dividend requirements,
excluding interest on deposits, represent interest expense (except interest on
deposits), capitalized interest, an amount equal to the pre-tax earnings
required to meet applicable preferred stock dividend requirements, and the
interest factor included in rents. Combined fixed charges and preferred stock
dividend requirements, including interest on deposits, represent all interest
expense, capitalized interest, an amount equal to the pre-tax earnings required
to meet applicable preferred stock dividend requirements, and the interest
factor included in rents.
19
<PAGE> 21
ACCOUNTING TREATMENT
For financial reporting purposes, the Trust will be treated as a subsidiary
of the Company and, accordingly, the accounts of the Trust will be included in
the consolidated financial statements of the Company. The Capital Securities
will be presented in the consolidated balance sheet of the Company in the "Trust
Preferred Securities" line item in the liabilities section and appropriate
disclosures about the Capital Securities, the Guarantee and the Junior
Subordinated Debentures will be included in the notes to the consolidated
financial statements for financial reporting purposes. The Company will record
Distributions payable on the Capital Securities as interest expense in the
consolidated statements of income.
REGULATORY TREATMENT
The Company is required by the Federal Reserve to maintain certain levels
of capital for bank regulatory purposes. The Company expects that the Capital
Securities will be treated as Tier 1 capital of the Company for such purposes.
CAPITALIZATION
The following table sets forth the consolidated capitalization of the
Company and its subsidiaries as of June 30, 1997.
<TABLE>
<CAPTION>
JUNE 30, 1997
-------------
ACTUAL
-------------
(DOLLARS IN
THOUSANDS)
<S> <C>
Long-term debt:
Direct obligations of Company................................................. $ 54,963
Obligations of Company subsidiaries........................................... 247,517
----------
Total long-term debt....................................................... 302,480
Trust preferred securities(1)................................................... 148,557
Shareholders' equity:
Common stock.................................................................. 452,407
Surplus....................................................................... 78,834
Retained earnings............................................................. 459,510
Treasury stock................................................................ (146,365)
Net unrealized gain/(loss) on available-for-sale securities................... 3,251
----------
Total shareholders' equity................................................. 847,637
----------
Total capitalization.................................................. $ 1,298,674
----------
Capital ratios:
Tier 1 capital to risk-based assets........................................... 8.56%
Total capital to risk-based assets............................................ 12.54
Leverage...................................................................... 7.74
</TABLE>
- ---------------
(1) "Trust preferred securities" reflects the Capital Securities. The Trust is a
wholly owned subsidiary of the Company and holds the Junior Subordinated
Debentures as its sole asset.
20
<PAGE> 22
THE EXCHANGE OFFER
PURPOSE AND EFFECT OF THE EXCHANGE OFFER
In connection with the sale of the Old Capital Securities, the Company and
the Trust entered into a Registration Rights Agreement (the "Registration Rights
Agreement") with the Initial Purchasers of the Old Capital Securities (the
"Initial Purchasers"), pursuant to which the Company and the Trust agreed to
file and to use their reasonable efforts to cause to become effective with the
Commission a registration statement with respect to the exchange of the Old
Capital Securities for Capital Securities with terms identical in all material
respects to the terms of the Old Capital Securities. A copy of the Registration
Rights Agreement is an exhibit to the Registration Statement of which this
Prospectus is a part.
The Exchange Offer is being made to satisfy the contractual obligations of
the Company and the Trust under the Registration Rights Agreement. The form and
terms of the New Capital Securities are the same as the form and terms of the
Old Capital Securities except that the New Capital Securities have been
registered under the Securities Act and therefore will not be subject to certain
restrictions on transfer applicable to the Old Capital Securities. Upon
consummation of the Exchange Offer, holders of Old Capital Securities will not
be entitled to any increase in the distribution rate thereon or any further
registration rights under the Registration Rights Agreement, except under
certain limited circumstances. See "Risk Factors -- Consequences of a Failure to
Exchange Old Capital Securities" and "Description of Capital Securities."
As soon as practicable after the Expiration Date, the Company will exchange
the Old Guarantee for the New Guarantee and all of the Old Junior Subordinated
Debentures, of which $154,640,000 aggregate principal amount is outstanding, for
a like aggregate principal of the New Junior Subordinated Debentures. The New
Guarantee and New Junior Subordinated Debentures have been registered under the
Securities Act.
The Exchange Offer is not being made to, nor will the Trust accept tenders
for exchange from, holders of Old Capital Securities in any jurisdiction in
which the Exchange Offer or the acceptance thereof would not be in compliance
with the securities or blue sky laws of such jurisdiction. Holders of Old
Capital Securities do not have any appraisal or dissenters' rights in connection
with the Exchange Offer.
Unless the context requires otherwise, the term "holder" with respect to
the Exchange Offer means any person in whose name the Old Capital Securities are
registered on the books of the Company or any other person who has obtained a
properly completed bond power from the registered holder, or any person whose
Old Capital Securities are held of record by The Depository Trust Company who
desires to deliver such Old Capital Securities by book-entry transfer at The
Depository Trust Company.
TERMS OF THE EXCHANGE
The Trust hereby offers, upon the terms and subject to the conditions set
forth in this Prospectus and in the accompanying Letter of Transmittal, to
exchange up to $150,000,000 aggregate liquidation amount of New Capital
Securities for a like aggregate liquidation amount of Old Capital Securities
properly tendered on or prior to the Expiration Date and not properly withdrawn
in accordance with the procedures described below. The Trust will issue,
promptly after the Expiration Date, $1,000 liquidation amount of New Capital
Securities in exchange for each $1,000 liquidation amount of outstanding Old
Capital Securities tendered and accepted in connection with the Exchange Offer.
The Exchange Offer is not conditioned upon any minimum liquidation amount
of Old Capital Securities being tendered. As of the date of this Prospectus,
$150,000,000 aggregate liquidation amount of the Old Capital Securities is
outstanding.
If any tendered Old Capital Securities are not accepted for exchange
because of an invalid tender, the occurrence of certain other events set forth
herein or otherwise, certificates for any such unaccepted Old Capital Securities
will be returned, without expense, to the tendering holder thereof promptly
after the Expiration Date.
21
<PAGE> 23
Holders who tender Old Capital Securities in connection with the Exchange
Offer will not be required to pay brokerage commissions or fees or, subject to
the instructions in the Letter of Transmittal, transfer taxes with respect to
the exchange of Old Capital Securities in connection with the Exchange Offer.
The Company will pay all charges and expenses, other than certain applicable
taxes described below, in connection with the Exchange Offer. See "-- Fees and
Expenses."
Pursuant to the Letter of Transmittal or Agent's Message in lieu thereof,
each holder who tenders Old Capital Securities will warrant and agree in the
Letter of Transmittal that it has full power and authority to tender, exchange,
sell, assign and transfer the tendered Old Capital Securities, that the Trust
will acquire good, marketable and unencumbered title to the tendered Old Capital
Securities, free and clear of all liens, restrictions, charges and encumbrances,
and that the Old Capital Securities tendered for exchange are not subject to any
adverse claims or proxies. The holder also will warrant and agree that it will,
upon request, execute and deliver any additional documents deemed by the Trust
or the Exchange Agent to be necessary or desirable to complete the exchange,
sale, assignment, and transfer of the Old Capital Securities tendered pursuant
to the Exchange Offer.
The Trust reserves the right in its sole discretion to (a) purchase or make
offers for any Old Capital Securities that remain outstanding subsequent to the
Expiration Date, or, as set forth under "-- Expiration Date; Extensions;
Amendments," to terminate the Exchange Offer and (b) to the extent permitted by
applicable law, purchase Old Capital Securities in the open market, in privately
negotiated transactions or otherwise. The terms of any such purchases or offers
may differ from the terms of the Exchange Offer.
EXPIRATION DATE; EXTENSIONS; AMENDMENTS
The term "Expiration Date" means 5:00 p.m., New York City time, on
, 1997 unless the Exchange Offer is extended by the Company and the
Trust (in which case the term "Expiration Date" shall mean the latest date and
time to which the Exchange Offer is extended).
The Company and the Trust expressly reserve the right in their sole and
absolute discretion, subject to applicable law, at any time and from time to
time, (i) to delay the acceptance of the Old Capital Securities for exchange or
to terminate the Exchange Offer (whether or not any Old Capital Securities have
theretofore been accepted for exchange) if the Company and the Trust determine,
in their sole and absolute discretion, that any of the events or conditions
referred to under "-- Conditions to the Exchange Offer" have occurred or exist
or have not been satisfied, (ii) to extend the Expiration Date of the Exchange
Offer and retain all Old Capital Securities tendered pursuant to the Exchange
Offer, subject, however, to the right of holders of Old Capital Securities to
withdraw their tendered Old Capital Securities as described under "-- Withdrawal
Rights," and (iii) to waive any condition or otherwise amend the terms of the
Exchange Offer in any respect deemed by them to be advantageous to the holders
of the Old Capital Securities. If the Exchange Offer is amended in a manner
determined by the Company and the Trust to constitute a material change, or if
the Company and the Trust waive a material condition of the Exchange Offer, the
Trust will promptly disclose such amendment by means of a prospectus supplement
that will be distributed to the registered holders of the Old Capital
Securities, and the Company and the Trust will extend the Exchange Offer to the
extent required by Rule 14e-1 under the Exchange Act.
Any such delay in acceptance, extension, termination or amendment will be
followed promptly by oral or written notice thereof to the Exchange Agent and by
making a public announcement thereof, and such announcement in the case of an
extension will be made no later than 9:00 a.m., New York City time, on the next
business day after the previously scheduled Expiration Date. Without limiting
the manner in which the Trust may choose to make any public announcement and
subject to applicable law, the Trust shall have no obligation to publish,
advertise or otherwise communicate any such public announcement other than by
issuing a release to an appropriate news agency.
RESALES OF NEW CAPITAL SECURITIES
The Trust is making the Exchange Offer for the Capital Securities in
reliance on the position of the staff of the Division of Corporation Finance of
the Commission as set forth in certain interpretive letters addressed
22
<PAGE> 24
to third parties in other transactions. However, neither the Company nor the
Trust sought its own interpretive letter and there can be no assurance that the
staff of the Division of Corporation Finance of the Commission would make a
similar determination with respect to the Exchange Offer as it has in such
interpretive letters to third parties. Based on these interpretations by the
staff of the Division of Corporation Finance, and subject to the two immediately
following sentences, the Company and the Trust believe that New Capital
Securities issued pursuant to this Exchange Offer in exchange for Old Capital
Securities may be offered for resale, resold and otherwise transferred by a
holder thereof (other than a holder who is a broker-dealer) without further
compliance with the registration and prospectus delivery requirements of the
Securities Act, provided that such New Capital Securities are acquired in the
ordinary course of such holder's business and that such holder is not
participating, and has no arrangement or understanding with any person to
participate, in a distribution (within the meaning of the Securities Act) of
such New Capital Securities. However, any holder of Old Capital Securities who
is an "affiliate" of the Company or the Trust (within the meaning of Rule 405
under the Securities Act) or who intends to participate in the Exchange Offer
for the purpose of distributing New Capital Securities, or any broker-dealer who
purchased Old Capital Securities from the Trust to resell pursuant to Rule 144A
or any other available exemption under the Securities Act, (a) will not be able
to rely on the interpretations of the staff of the Division of Corporation
Finance of the Commission set forth in the above-mentioned interpretive letters,
(b) will not be permitted or entitled to tender such Old Capital Securities in
the Exchange Offer and (c) must comply with the registration and prospectus
delivery requirements of the Securities Act in connection with any sale or other
transfer of such Old Capital Securities unless such sale is made pursuant to an
exemption from such requirements. In addition, as described below, if any
broker-dealer holds Old Capital Securities acquired for its own account as a
result of market-making or other trading activities and exchanges such Old
Capital Securities for New Capital Securities, then such broker-dealer must
deliver a prospectus meeting the requirements of the Securities Act in
connection with any resales of such New Capital Securities.
Each holder of Old Capital Securities who wishes to exchange Old Capital
Securities for New Capital Securities in the Exchange Offer will be required to
represent that (i) it is not an "affiliate" of the Company or the Trust, (ii)
any New Capital Securities to be received by it are being acquired in the
ordinary course of its business, (iii) it has no arrangement or understanding
with any person to participate in a distribution (within the meaning of the
Securities Act) of such New Capital Securities, and (iv) such holder is not
engaged in, and does not intend to engage in, a distribution (within the meaning
of the Securities Act) of such New Capital Securities. In addition, the Company
and the Trust may require such holder, as a condition to such holder's
eligibility to participate in the Exchange Offer, to furnish to the Company and
the Trust (or an agent thereof) in writing information as to the number of
"beneficial owners" (within the meaning of Rule 13d-3 under the Exchange Act) on
behalf of whom such holder holds the Capital Securities to be exchanged in the
Exchange Offer. Each broker-dealer that receives New Capital Securities for its
own account pursuant to the Exchange Offer must acknowledge that it acquired the
Old Capital Securities for its own account as the result of market-making
activities or other trading activities and must agree that it will deliver a
prospectus meeting the requirements of the Securities Act in connection with any
resale of such New Capital Securities. The Letter of Transmittal states that by
so acknowledging and by delivering a prospectus, a broker-dealer will not be
deemed to admit that it is an "underwriter" within the meaning of the Securities
Act. Based on the position taken by the staff of the Division of Corporation
Finance of the Commission in the interpretive letters referred to above, the
Company and the Trust believe that broker-dealers who acquired Old Capital
Securities for their own accounts, as a result of market-making activities or
other trading activities ("Participating Broker-Dealers"), may fulfill their
prospectus delivery requirements with respect to the New Capital Securities
received upon exchange of such Old Capital Securities (other than Old Capital
Securities which represent an unsold allotment from the original sale of the Old
Capital Securities) with this Prospectus, as it may be amended or supplemented
from time to time. Subject to certain provisions set forth in the Registration
Rights Agreement, the Company and the Trust have agreed that this Prospectus, as
it may be amended or supplemented from time to time, may be used by a
Participating Broker-Dealer in connection with resales of such New Capital
Securities for a period ending 180 days after the Registration Statement of
which this Prospectus constitutes a part is declared effective. See "Plan of
Distribution." Any Participating Broker-Dealer who is an "affiliate" of the
Company or the Trust may not rely on such interpretive letters and must
23
<PAGE> 25
comply with the registration and prospectus delivery requirements of the
Securities Act in connection with any resale transaction.
Each Participating Broker-Dealer who surrenders Old Capital Securities
pursuant to the Exchange Offer will be deemed to have agreed, by execution of
the Letter of Transmittal, that, upon receipt of notice from the Company or the
Trust of the occurrence of any event or the discovery of any fact which makes
any statement contained or incorporated by reference in this Prospectus untrue
in any material respect or which causes this Prospectus to omit to state a
material fact necessary in order to make the statements contained or
incorporated by reference herein, in light of the circumstances under which they
were made, not misleading or of the occurrence of certain other events specified
in the Registration Rights Agreement, such Participating Broker-Dealer will
suspend the sale of New Capital Securities pursuant to this Prospectus until the
Company or the Trust has amended or supplemented this Prospectus to correct such
misstatement or omission and has furnished copies of the amended or supplemented
Prospectus to such Participating Broker-Dealer or the Company or the Trust has
given notice that the sale of the New Capital Securities may be resumed, as the
case may be.
ACCEPTANCE FOR EXCHANGE AND ISSUANCE OF NEW CAPITAL SECURITIES
Upon the terms and subject to the conditions of the Exchange Offer, the
Trust will exchange, and will issue to the Exchange Agent, New Capital
Securities for Old Capital Securities validly tendered and not withdrawn
(pursuant to the withdrawal rights described under "-- Withdrawal Rights")
promptly after the Expiration Date.
Subject to the terms and conditions of the Exchange Offer, the Trust will
be deemed to have accepted for exchange, and thereby exchanged, Old Capital
Securities validly tendered and not withdrawn as, if and when the Trust gives
oral or written notice to the Exchange Agent of the Trust's acceptance of such
Old Capital Securities for exchange pursuant to the Exchange Offer. The Exchange
Agent will act as agent for the Trust for the purpose of receiving tenders of
Old Capital Securities, Letters of Transmittal and related documents, and as
agent for tendering holders for the purpose of receiving Old Capital Securities,
Letters of Transmittal and related documents and transmitting New Capital
Securities to validly tendering holders. Such exchange will be made promptly
after the Expiration Date. If for any reason whatsoever, acceptance for exchange
or the exchange of any Old Capital Securities tendered pursuant to the Exchange
Offer is delayed (whether before or after the Trust's acceptance for exchange of
Old Capital Securities) or the Trust extend the Exchange Offer or are unable to
accept for exchange or exchange Old Capital Securities tendered pursuant to the
Exchange Offer, then, without prejudice to the Company's or the Trust's rights
set forth herein, the Exchange Agent may, nevertheless, on behalf of the Trust
and subject to Rule 14e-1(c) under the Exchange Act, retain tendered Old Capital
Securities and such Old Capital Securities may not be withdrawn except to the
extent tendering holders are entitled to withdrawal rights as described under
"-- Withdrawal Rights."
PROCEDURES FOR TENDERING OLD CAPITAL SECURITIES
Valid Tender. Except as set forth below, in order for Old Capital
Securities to be validly tendered pursuant to the Exchange Offer, a properly
completed and duly executed Letter of Transmittal (or facsimile thereof)or (in
the case of book-entry transfer) an Agent's Message in lieu of the Letter of
Transmittal, with any required signature guarantees and any other required
documents, must be received by the Exchange Agent at one of its addresses set
forth under "-- Exchange Agent," and one of the following must apply: (i)
tendered Old Capital Securities must be received by the Exchange Agent, or (ii)
such Old Capital Securities must be tendered pursuant to the procedures for
book-entry transfer set forth below and a book-entry confirmation must be
received by the Exchange Agent, in each case on or prior to the Expiration Date,
or (iii) the guaranteed delivery procedures set forth below must be complied
with.
The term "book-entry confirmation" means a timely confirmation of a
book-entry transfer of Old Capital Securities into the Exchange Agent's account
at DTC. The term "Agent's Message" means a message transmitted by DTC to, and
received by, the Exchange Agent, and forming a part of a book-entry
confirmation, which states that DTC has received an express acknowledgement from
the tendering participant,
24
<PAGE> 26
which acknowledgement states that such participant has received and agrees to be
bound by the Letter of Transmittal and that the Trust and the Company may
enforce such Letter of Transmittal against such participant.
If less than all of the Old Capital Securities are tendered, a tendering
holder should fill in the amount of Old Capital Securities being tendered in the
appropriate box on the Letter of Transmittal or so indicated in an Agent's
Message in lieu of a Letter of Transmittal. The entire amount of Old Capital
Securities delivered to the Exchange Agent will be deemed to have been tendered
unless otherwise indicated.
THE METHOD OF DELIVERY OF CERTIFICATES, THE LETTER OF TRANSMITTAL AND ALL
OTHER REQUIRED DOCUMENTS IS AT THE OPTION AND SOLE RISK OF THE TENDERING HOLDER,
AND DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE EXCHANGE
AGENT. IF DELIVERY IS BY MAIL, REGISTERED MAIL, RETURN RECEIPT REQUESTED,
PROPERLY INSURED, OR AN OVERNIGHT DELIVERY SERVICE IS RECOMMENDED. IN ALL CASES,
SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.
Book Entry Transfer. The Exchange Agent will establish an account with
respect to the Old Capital Securities at The Depository Trust Company ("DTC")
for purposes of the Exchange Offer within two business days after the date of
this Prospectus. Any financial institution that is a participant in DTC's book-
entry transfer facility system may make a book-entry delivery of the Old Capital
Securities by causing DTC to transfer such Old Capital Securities into the
Exchange Agent's account at DTC in accordance with DTC's procedures for
transfers. However, although delivery of Old Capital Securities may be effected
through book-entry transfer into the Exchange Agent's account at DTC, the Letter
of Transmittal (or facsimile thereof), properly completed and duly executed,
with any required signature guarantees, or an Agent's Message in lieu of the
Letter of Transmittal, and any other required documents, must in any case be
delivered to and received by the Exchange Agent at its address set forth under
"-- Exchange Agent" on or prior to the Expiration Date, or the guaranteed
delivery procedure set forth below must be complied with.
DELIVERY OF DOCUMENTS TO DTC IN ACCORDANCE WITH DTC'S PROCEDURES DOES NOT
CONSTITUTE DELIVERY TO THE EXCHANGE AGENT.
Signature Guarantees. Certificates for the Old Capital Securities need not
be endorsed and signature guarantees on the Letter of Transmittal are
unnecessary unless (a) a certificate for the Old Capital Securities is
registered in a name other than that of the person surrendering the certificate
or (b) such registered holder completes the box entitled "Special Issuance
Instructions" or "Special Delivery Instructions" in the Letter of Transmittal.
In the case of (a) or (b) above, such certificates for Old Capital Securities
must be duly endorsed or accompanied by a properly executed bond power, with the
endorsement or signature on the bond power and on the Letter of Transmittal
guaranteed by a firm or other entity identified in Rule 17Ad-15 under the
Exchange Act as an "eligible guarantor institution," including (as such terms
are defined therein): (i) a bank; (ii) a broker, dealer, municipal securities
broker or dealer or government securities broker or dealer; (iii) a credit
union; (iv) a national securities exchange, registered securities association or
clearing agency; or (v) a savings association that is a participant in a
Securities Transfer Association (each, an "Eligible Institution"), unless
surrendered on behalf of such Eligible Institution. See Instruction 1 to the
Letter of Transmittal.
Guaranteed Delivery. If a holder desires to tender Old Capital Securities
pursuant to the Exchange Offer and the certificates for such Old Capital
Securities are not immediately available or time will not permit all required
documents to reach the Exchange Agent on or before the Expiration Date, or the
procedures for book-entry transfer cannot be completed on a timely basis, such
Old Capital Securities may nevertheless be tendered, provided that all of the
following guaranteed delivery procedures are complied with.
(i) such tenders are made by or through an Eligible Institution;
(ii) a properly completed and duly executed Notice of Guaranteed
Delivery, substantially in the form accompanying the Letter of Transmittal,
is received by the Exchange Agent, as provided below, on or prior to
Expiration Date; and
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(iii) the certificates (or a book-entry confirmation) representing all
tendered Old Capital Securities, in proper form for transfer, together with
a properly completed and duly executed Letter of Transmittal (or facsimile
thereof), with any required signature guarantees and any other documents
required by the Letter of Transmittal, are received by the Exchange Agent
within five New York Stock Exchange trading days after the date of
execution of such Notice of Guaranteed Delivery.
The Notice of Guaranteed Delivery may be delivered by hand, transmitted by
facsimile or mailed to the Exchange Agent and must include a guarantee by an
Eligible Institution in the form set forth in such notice.
Notwithstanding any other provisions hereof, the delivery of New Capital
Securities in exchange for Old Capital Securities tendered and accepted for
exchange pursuant to the Exchange Offer will in all cases be made only after
timely receipt by the Exchange Agent of Old Capital Securities or of a
book-entry confirmation with respect to such Old Capital Securities and a Letter
of Transmittal (or facsimile thereof), properly completed and duly executed,
with any required signature guarantees or (in the case of a book-entry transfer)
an Agent's Message in lieu of the Letter of Transmittal and any other documents
required by the Letter of Transmittal. Accordingly, the delivery of New Capital
Securities might not be made to all tendering holders at the same time, and will
depend upon when Old Capital Securities, book-entry confirmations with respect
to Old Capital Securities and other required documents are received by the
Exchange Agent.
The Trust's acceptance for exchange of Old Capital Securities tendered
pursuant to any of the procedures described above will constitute a binding
agreement between the tendering holder, the Trust and the Company upon the terms
and subject to the conditions of the Exchange Offer.
Determination of Validity. All questions as to the form of documents,
validity, eligibility (including time of receipt) and acceptance for exchange of
any tendered Old Capital Securities will be determined by the Trust, in its sole
discretion, whose determination shall be final and binding on all parties. The
Trust reserves the absolute right, in its sole and absolute discretion, to
reject any and all tenders determined by it not to be in proper form or the
acceptance of which, or exchange for which may, in the view of counsel to the
Trust, be unlawful. The Trust also reserves the absolute right, subject to
applicable law, to waive any of the conditions of the Exchange Offer as set
forth under "-- Conditions to the Exchange Offer" or any condition or
irregularity in any tender of Old Capital Securities of any particular holder
whether or not similar conditions or irregularities are waived in the case of
other holders.
The Trust's interpretation of the terms and conditions of the Exchange
Offer (including the Letter of Transmittal and the instructions thereto) will be
final and binding. No tender of Old Capital Securities will be deemed to have
been validly made until all irregularities with respect to such tender have been
cured or waived. Neither the Trust, any affiliates or assigns of the Trust, the
Exchange Agent nor any other person shall be under any duty to give any
notification of any irregularities in tenders or incur any liability for failure
to give such notification.
If any Letter of Transmittal, endorsement, bond power, power of attorney,
or any other document required by the Letter of Transmittal is signed by a
trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and unless waived by the Trust,
proper evidence satisfactory to the Trust, in its sole discretion, of such
person's authority to so act must be submitted.
A beneficial owner of Old Capital Securities that are held by or registered
in the name of a broker, dealer, commercial bank, trust company or other nominee
or custodian is urged to contact such entity promptly if such beneficial holder
wishes to participate in the Exchange Offer.
WITHDRAWAL RIGHTS
Except as otherwise provided herein, tenders of Old Capital Securities may
be withdrawn at any time on or prior to the Expiration Date.
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In order for a withdrawal to be effective a written, telegraphic, telex or
facsimile transmission of such notice of withdrawal must be timely received by
the Exchange Agent at one of its addresses set forth under "-- Exchange Agent"
on or prior to the Expiration Date. Any such notice of withdrawal must specify
the name of the person who tendered the Old Capital Securities to be withdrawn,
the aggregate principal amount of Old Capital Securities to be withdrawn, and
(if certificates for such Old Capital Securities have been tendered) the name of
the registered holder of the Old Capital Securities as set forth in the Old
Capital Securities, if different from that of the person who tendered such Old
Capital Securities. If Old Capital Securities have been delivered or otherwise
identified to the Exchange Agent, then prior to the physical release of such Old
Capital Securities, the tendering holder must submit the serial numbers shown on
the particular Old Capital Securities to be withdrawn and the signature on the
notice of withdrawal must be guaranteed by an Eligible Institution, except in
the case of Old Capital Securities tendered for the account of an Eligible
Institution. If Old Capital Securities have been tendered pursuant to the
procedures for book-entry transfer set forth above under "-- Procedures for
Tendering Old Capital Securities," the notice of withdrawal must specify the
name and number of the account at DTC to be credited with the withdrawal of Old
Capital Securities, in which case a notice of withdrawal will be effective if
delivered to the Exchange Agent by written, telegraphic, telex or facsimile
transmission. Withdrawals of tenders of Old Capital Securities may not be
rescinded. Old Capital Securities properly withdrawn will not be deemed validly
tendered for purposes of the Exchange Offer, but may be retendered at any
subsequent time on or prior to the Expiration Date by following any of the
procedures described above under "-- Procedures for Tendering Old Capital
Securities."
All questions as to the validity, form and eligibility (including time of
receipt) of such withdrawal notices will be determined by the Trust, in its sole
discretion, whose determination shall be final and binding on all parties.
Neither the Trust, any affiliates or assigns of the Trust, the Exchange Agent
nor any other person shall be under any duty to give any notification of any
irregularities in any notice of withdrawal or incur any liability for failure to
give any such notification. Any Old Capital Securities which have been tendered
but which are withdrawn will be returned to the holder thereof promptly after
withdrawal.
DISTRIBUTIONS ON THE NEW CAPITAL SECURITIES
Each New Capital Security will pay cumulative Distributions from the most
recent Distribution Date on the Old Capital Securities surrendered in exchange
for such New Capital Securities or, if no Distributions have been paid on such
Old Capital Securities, from June 8, 1997. Holders of the Old Capital Securities
whose Old Capital Securities are accepted for exchange will not receive
accumulated Distributions on such Old Capital Securities for any period from and
after the last Distribution Date on such Old Capital Securities prior to the
original issue date of the New Capital Securities or, if no such Distributions
have been paid, will not receive any accumulated Distributions on such Old
Capital Securities, and will be deemed to have waived the right to receive any
Distributions on such Old Capital Securities accumulated from and after June 8,
1997.
CONDITIONS TO THE EXCHANGE OFFER
Notwithstanding any other provisions of the Exchange Offer, or any
extension of the Exchange Offer, the Trust will not be required to accept for
exchange, or to exchange, any Old Capital Securities for any New Capital
Securities, and, as described below, may terminate the Exchange Offer (whether
or not any Old Capital Securities have theretofore been accepted for exchange)
or may waive any conditions to or amend the Exchange Offer, if any of the
following conditions have occurred or exists or have not been satisfied:
(a) there shall occur a change in the current interpretation by the
staff of the Commission which permits the New Capital Securities issued
pursuant to the Exchange Offer in exchange for Old Capital Securities to be
offered for resale, resold and otherwise transferred by holders thereof
(other than broker-dealers and any such holder which is an "affiliate" of
the Company or the Trust within the meaning of Rule 405 under the
Securities Act) without compliance with the registration and prospectus
delivery provisions of the Securities Act, provided that such New Capital
Securities are acquired in the ordinary course of such holders' business
and such holders have no arrangement or understanding with any person to
participate in the distribution of such New Capital Securities;
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<PAGE> 29
(b) any action or proceeding shall have been instituted or threatened
in any court or by or before any governmental agency or body with respect
to the Exchange Offer which, in the Trust's judgment, would reasonably be
expected to impair the ability of the Trust or the Company to proceed with
the Exchange Offer;
(c) any law, statute, rule or regulation shall have been adopted or
enacted which, in the Trust's judgment, would reasonably be expected to
impair the ability of the Trust or the Company to proceed with the Exchange
Offer;
(d) a banking moratorium shall have been declared by United States
federal or New York or Ohio state authorities which, in the Trust's
judgment, would reasonably be expected to impair the ability of the Company
or the Trust to proceed with the Exchange Offer;
(e) trading on the New York Stock Exchange or generally in the
over-the-counter market shall have been suspended by order of the
Commission or any other governmental authority which, in the Trust's
judgment, would reasonably be expected to impair the ability of the Trust
or the Company to proceed with the Exchange Offer;
(f) a stop order shall have been issued by the Commission or any state
securities authority suspending the effectiveness of the Registration
Statement or proceedings shall have been initiated or, to the knowledge of
the Company or the Trust, threatened for that purpose or any governmental
approval has not been obtained, which approval the Trust shall, in its sole
discretion, deem necessary for the consummation of the Exchange Offer as
contemplated hereby; or
(g) any change, or any development involving a prospective change, in
the business or financial affairs of the Company or any of its subsidiaries
has occurred which, in the sole judgment of the Trust, might materially
impair the ability of the Trust or the Company to proceed with the Exchange
Offer.
If the Company and the Trust determine in their sole and absolute
discretion that any of the foregoing events or conditions has occurred or exists
or has not been satisfied, the Company and the Trust may, subject to applicable
law, terminate the Exchange Offer (whether or not any Old Capital Securities
have theretofore been accepted for exchange) or may waive any such condition or
otherwise amend the terms of the Exchange Offer in any respect. If such waiver
or amendment constitutes a material change to the Exchange Offer, the Company
and the Trust will promptly disclose such waiver by means of a prospectus
supplement that will be distributed to the registered holders of the Old Capital
Securities, and the Company and the Trust will extend the Exchange Offer to the
extent and in the manner required by Rule 14e-1 under the Exchange Act.
EXCHANGE AGENT
The First National Bank of Chicago has been appointed as Exchange Agent for
the Exchange Offer. Delivery of the Letters of Transmittal and any other
required documents, questions, requests for assistance, and requests for
additional copies of this Prospectus or of the Letter of Transmittal should be
directed to the Exchange Agent as follows:
<TABLE>
<S> <C> <C>
BY MAIL: FACSIMILE TRANSMISSION: BY HAND OR OVERNIGHT
(Registered or Certified Mail (Eligible Institutions Only) DELIVERY:
recommended) (212) 240-8938 The First National Bank of
The First National Bank of Chicago
Chicago BY TELEPHONE: c/o First Chicago Trust
c/o First Chicago Trust (212) 240-8801 Company of New York
Company of New York 14 Wall Street
14 Wall Street 8th Floor, Window 2
8th Floor, Window 2 New York, New York 10005
New York, New York 10005
</TABLE>
Delivery to other than the above addresses or facsimile number will not
constitute a valid delivery.
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FEES AND EXPENSES
The Company has agreed to pay the Exchange Agent reasonable and customary
fees for its services and will reimburse it for its reasonable out-of-pocket
expenses in connection therewith. The Company will also pay brokerage houses and
other custodians, nominees and fiduciaries the reasonable out-of-pocket expenses
incurred by them in forwarding copies of this Prospectus and related documents
to the beneficial owners of Old Capital Securities, and in handling or tendering
for their customers.
Holders who tender their Old Capital Securities for exchange will not be
obligated to pay any transfer taxes in connection therewith. If, however, New
Capital Securities are to be delivered to, or are to be issued in the name of,
any person other than the registered holder of the Old Capital Securities
tendered, or if a transfer tax is imposed for any reason other than the exchange
of Old Capital Securities in connection with the Exchange Offer, then the amount
of any such transfer taxes (whether imposed on the registered holder or any
other persons) will be payable by the tendering holder. If satisfactory evidence
of payment of such taxes or exemption therefrom is not submitted with the Letter
of Transmittal, the amount of such transfer taxes will be billed directly to
such tendering holder.
Neither the Company nor the Trust will make any payment to brokers, dealers
or others for soliciting acceptances of the Exchange Offer.
THE TRUST
The Trust is a statutory business trust formed under the Delaware Business
Trust Act, as amended (the "Trust Act"), pursuant to a declaration of trust (as
so amended and restated, the "Declaration") and the filing of a certificate of
trust as filed with the Secretary of State of the State of Delaware. The Company
acquired Common Securities in an aggregate liquidation amount equal to at least
3% of the total capital of the Trust. The Trust used all the proceeds derived
from the issuance of the Old Capital Securities and the Common Securities to
purchase the Junior Subordinated Debentures and, accordingly, the assets of the
Trust consist solely of the Junior Subordinated Debentures. The Trust exists for
the exclusive purpose of (i) issuing the Trust Securities representing undivided
beneficial ownership interests in the assets of the Trust, (ii) investing the
gross proceeds of the Trust Securities in the Junior Subordinated Debentures,
and (iii) engaging in only those other activities necessary or incidental
thereto.
Pursuant to the Declaration, there initially are five trustees (the
"Trustees") for the Trust. Three of the Trustees (the "Regular Trustees") are
individuals who are employees or officers of or who are affiliated with the
Company. The fourth trustee is required to be a financial institution that is
unaffiliated with the Company (the "Property Trustee"). The fifth trustee is
required to be an entity that maintains its principal place of business in the
State of Delaware (the "Delaware Trustee"). Initially, The First National Bank
of Chicago, a national banking association, is acting as Property Trustee, and
its affiliate, First Chicago Delaware Inc., a Delaware corporation, is acting as
Delaware Trustee until, in each case, removed or replaced by the Company as
holder of the Common Securities. The First National Bank of Chicago is also
acting as trustee under the Guarantee (the "Guarantee Trustee").
The Property Trustee holds title to the Junior Subordinated Debentures for
the benefit of the holders of the Trust Securities, and the Property Trustee
will have the power to exercise all rights, powers and privileges with respect
to the Junior Subordinated Debentures under the Indenture (as defined herein) as
the holder of the Junior Subordinated Debentures. In addition, the Property
Trustee will maintain exclusive control of a non-interest bearing bank account
(the "Property Account"), which will not be segregated from other funds except
to the extent required by law, to hold all payments made in respect of the
Junior Subordinated Debentures for the benefit of the holders of the Trust
Securities. The Guarantee Trustee holds the Guarantee for the benefit of the
holders of the Capital Securities. The Company, as the holder of all the Common
Securities, will have the right to appoint, remove or replace any of the
Trustees and to increase or decrease the number of Trustees, provided that the
number of Trustees shall be at least three; provided further that at least one
Trustee shall be a Delaware Trustee, at least one trustee shall be the Property
Trustee and at least one Trustee shall be a Regular Trustee. Under the
Indenture, the Company, as borrower, is required to pay all fees
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and expenses related to the organization and operations of the Trust (including
any taxes, duties, assessments or governmental charges of whatever nature (other
than withholding taxes) imposed by the United States or any other domestic
taxing authority upon the Trust) and the offering of the Capital Securities and
be responsible for all debts and obligations of the Trust (other than with
respect to the Common Securities and the Capital Securities).
For so long as the Capital Securities remain outstanding, the Company has
covenanted (i) to maintain directly or indirectly 100% ownership of the Common
Securities, (ii) to cause the Trust to remain a statutory business trust and not
to voluntarily dissolve, wind-up, liquidate or be terminated, except as
permitted by the Declaration, (iii) to use its commercially reasonable efforts
to ensure that the Trust will not be an "investment company" for purposes of the
Investment Company Act of 1940, as amended, and (iv) to take no action that
would be reasonably likely to cause the Trust to be classified as an association
or a publicly traded partnership taxable as a corporation for United States
federal income tax purposes.
The rights of the holders of the Capital Securities, including economic
rights, rights to information and voting rights, are set forth in the
Declaration and the Trust Indenture Act. See "Description of Capital
Securities." The Declaration and the Guarantee also incorporate by reference the
terms of the Trust Indenture Act.
The location of the principal executive office of the Trust is c/o Star
Banc Corporation, 425 Walnut Street, Cincinnati, Ohio 45202, and its telephone
number is (513) 632-4000.
DESCRIPTION OF CAPITAL SECURITIES
Pursuant to the terms of the Declaration, the Regular Trustees on behalf of
the Trust have issued the Old Capital Securities and the Common Securities. The
Old Capital Securities represent, and the New Capital Securities will represent,
undivided beneficial ownership interests in the assets of the Trust and the
holders thereof will be entitled to a preference in certain circumstances with
respect to Distributions and amounts payable on redemption or liquidation over
the Common Securities, as well as other benefits as described in the
Declaration. This summary of certain provisions of the Capital Securities and
the Declaration does not purport to be complete and is subject to, and is
qualified in its entirety by reference to, all the provisions of the
Declaration, including the definitions therein of certain terms, and the Trust
Indenture Act. Wherever particular defined terms of the Declaration (as
supplemented or amended from time to time) are referred to herein, the
definitions of such defined terms are incorporated herein by reference.
GENERAL
The Capital Securities 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 the Common Securities. The Guarantee executed by the
Company for the benefit of the holders of the Capital Securities is a guarantee
on a subordinated basis with respect to the Capital Securities but will not
guarantee payment of Distributions or amounts payable on redemption or
liquidation of the Capital Securities when the Trust does not have sufficient
funds available to make such payments. See "Description of Guarantee." In such
event, the remedy of a holder of Capital Securities is to vote to direct the
Property Trustee to enforce the Property Trustee's rights under the Junior
Subordinated Debentures. See "-- Voting Rights; Amendment of the Declaration"
below. The Company's obligations under the Guarantee, taken together with its
obligations under the Junior Subordinated Debentures and the Indenture,
including its obligation to pay all costs, expenses and liabilities of the Trust
(other than with respect to the Common Securities and the Capital Securities),
constitute a full and unconditional guarantee of all of the Trust's obligations
under the Capital Securities.
Holders of the Capital Securities have no preemptive or similar rights.
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DISTRIBUTIONS
Distributions on each Capital Security will be payable at a variable annual
rate of LIBOR plus 0.765% of the liquidation amount of $1,000, payable quarterly
in arrears on March 15, June 15, September 15 and December 15 of each year.
Distributions will accumulate from June 8, 1997, the date of original issuance,
and commence on September 15, 1997. The amount of Distributions payable for any
period will be computed on the basis of the actual number of days elapsed in a
year of twelve 30-day months.
Distributions on the Capital Securities must be paid on the dates payable
to the extent that the Trust has funds available for the payment of such
distributions. The revenue of the Trust available for distribution to holders of
its Capital Securities will be limited to payments under the Junior Subordinated
Debentures. See "Description of Junior Subordinated Debentures." If the Company
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 Company has 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 (each, an "Extension
Period"), provided that no Extension Period may extend beyond the Stated
Maturity (as defined below) of the Junior Subordinated Debentures. As a
consequence of any such extension, 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 will
accumulate and compound quarterly at a variable rate per annum of LIBOR plus
0.765% thereof from the relevant payment date for such Distributions. The term
"Distributions" as used herein shall include any such compounded amounts unless
the context otherwise requires. During any such Extension Period, the Company
may not, and may not permit any subsidiary of the Company to, (i) declare or pay
any dividends or distributions on, or redeem, purchase, acquire, or make a
liquidation payment with respect to, any of the Company's capital stock or (ii)
make any payment of principal, interest or premium, if any, on or repay,
repurchase or redeem any debt securities of the Company that rank pari passu
with or junior to the Junior Subordinated Debentures or make any guarantee
payments with respect to any guarantee by the Company of the debt securities of
any subsidiary of the Company if such guarantee ranks pari passu with or junior
in interest to the Junior Subordinated Debentures (other than (a) repurchases,
redemptions or other acquisitions of shares of capital stock of the Company in
connection with any employment contract, benefit plan or other similar
arrangement with or for the benefit of any one or more employees, officers,
directors or consultants or in connection with a dividend reinvestment or
stockholder stock purchase plan, (b) as a result of an exchange or conversion of
any class or series of the Company's capital stock (or any capital stock of a
subsidiary of the Company) for any class or series of the Company's capital
stock or of any class or series of the Company's indebtedness for any class or
series of the Company's capital stock, (c) 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,
(d) any declaration of a dividend in connection with the adoption of any
stockholder's rights plan, or the issuance of rights, stock or other property
under any stockholder's rights plan, or the redemption or repurchase of rights
pursuant thereto, or (e) any dividend in the form of stock, warrants, options or
other rights where the dividend stock or the stock issuable upon exercise of
such warrants, options or other rights is the same stock as that on which the
dividend is being paid or ranks pari passu with or junior to such stock). Prior
to the termination of any such Extension Period, the Company may further extend
the Extension Period, provided that no Extension Period may exceed 20
consecutive quarterly periods or extend beyond the Stated Maturity of the Junior
Subordinated Debentures. Upon the termination of any such Extension Period and
the payment of all amounts then due on any Interest Payment Date, the Company
may elect to begin a new Extension Period. See "Description of Junior
Subordinated Debentures -- Option to Extend Interest Payment Period" and
"Certain United States Federal Income Tax Consequences -- Interest Income and
Original Issue Discount." The Company has no current intention of exercising its
right to defer payments of interest by extending the interest payment period of
the Junior Subordinated Debentures.
In the event that any date on which Distributions are payable on the
Capital Securities is not a Business Day, then payment of the Distributions
payable on such date will be made on the next succeeding day that is a Business
Day (and without any additional Distributions or other payment in respect of any
such delay), with
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the same force and effect as if made on the date such payment was originally
payable (each date on which Distributions are payable in accordance with the
foregoing, a "Distribution Date"). A "Business Day" shall mean any day other
than a Saturday or a Sunday, or a day on which banking institutions in New York
City, Chicago, Illinois or Cincinnati, Ohio are authorized or required by law or
executive order to remain closed or a day on which the corporate trust office of
the Property Trustee or the Indenture Trustee (as defined herein) is closed for
business.
Distributions on the Capital Securities (other than distributions on a
Redemption Date) will be payable to the holders thereof as they appear on the
register of the Trust on the relevant record dates, which shall be the 1st day
of the month in which the relevant Distribution Date occurs. Distributions
payable on any Capital Securities that are not punctually paid on any
Distribution Date will cease to be payable to the person in whose name such
Capital Securities are registered on the relevant record date, and such
defaulted distribution will instead be payable to the person in whose name such
Capital Securities are registered on the special record date or other specified
date determined in accordance with the Declaration.
REDEMPTION
Mandatory Redemption. Unless a Special Event has occurred, the Capital
Securities will not be redeemable prior to June 15, 2007. Upon the repayment or
redemption of the Junior Subordinated Debentures, whether at Stated Maturity or
upon earlier redemption as provided in the Indenture, the proceeds from such
repayment or redemption shall be applied by the Property Trustee to redeem the
Capital Securities and Common Securities on a pro rata basis, upon not less than
30 nor more than 60 days notice prior to the date fixed for repayment or
redemption. If less than all of the Junior Subordinated Debentures are to be
repaid or redeemed on a Redemption Date, then the proceeds from such repayment
or redemption shall be allocated to the redemption pro rata of the Capital
Securities and the Common Securities.
Special Event Redemption or Distribution of Junior Subordinated
Debentures. If a Special Event shall occur and be continuing, the Company will
have the right, subject to the receipt of any necessary prior approval of the
Federal Reserve, to either (i) redeem within 90 days following the occurrence of
such Special Event the Junior Subordinated Debentures on the date of redemption
(the "Redemption Date") in whole (but not in part) and thereby cause a mandatory
redemption of the Capital Securities in whole (but not in part) at a redemption
price with respect to the Capital Securities equal to 100% of the liquidation
amount thereof plus accrued and unpaid Distributions thereon or (ii) dissolve
the Trust and, after satisfaction of the claims of creditors of the Trust as
provided by applicable law, cause the Junior Subordinated Debentures to be
distributed to the holders of the Capital Securities in liquidation of the
Trust. Under current United States federal income tax law and interpretations
thereof and assuming, as expected, the Trust is treated as a grantor trust, a
distribution of the Junior Subordinated Debentures would not be a taxable event
to holders of the Capital Securities. Should there be a change in law, a change
in legal interpretation, certain Tax Events or other circumstances, however,
such distribution could be a taxable event to holders of the Capital Securities.
See "Certain United States Federal Income Tax Consequences -- Distribution of
Junior Subordinated Debentures to Holders of Capital Securities."
If the Company does not elect either option described above, the Capital
Securities will remain outstanding until the repayment of the Junior
Subordinated Debentures, whether at maturity or redemption, and in the event a
Tax Event has occurred and is continuing, the Company will be obligated to pay
any additional taxes, duties, assessments and other governmental charges (other
than withholding taxes) to which the Trust has become subject as a result of a
Tax Event. See "Description of Junior Subordinated Debentures".
A "Special Event" means a Tax Event, a Regulatory Capital Event or an
Investment Company Event. A "Tax Event" means the receipt by the Company of an
opinion of counsel, rendered by a law firm having a recognized national tax
practice, to the effect that, as a result of any amendment to, change in or
announced proposed change in the laws (or any regulations thereunder) of the
United States or any political subdivision or taxing authority thereof or
therein, or as a result of any official or administrative pronouncement or
action or judicial decision interpreting or applying such laws or regulations,
which amendment or change is adopted or
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which proposed change, pronouncement or decision is announced or which action is
taken on or after the date of original issuance of the Capital Securities, 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) interest payable by the Company on such Junior Subordinated
Debentures 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. A "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 for 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 1 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 Company shall not in and of itself constitute a
Regulatory Capital Event unless such liquidation shall have occurred in
connection with a Tax Event or an Investment Company Event. "Investment Company
Event" means the receipt by the Trust of an opinion of counsel, rendered by a
law firm having a recognized national securities practice, to the effect that,
as a result of the occurrence of a change in law or regulation or a change in
interpretation or application of law or regulation by any legislative body,
court, governmental agency or regulatory authority (a "Change in 1940 Act Law"),
the Trust is or will be considered an "investment company" that is required to
be registered under the Investment Company Act of 1940, as amended (the "1940
Act"), which Change in 1940 Act Law becomes effective on or after the date of
original issuance of the Capital Securities.
REDEMPTION PROCEDURES
Capital Securities redeemed on each Redemption Date shall be redeemed at
the redemption price in respect of the Junior Subordinated Debentures (the
"Redemption Price") with the applicable proceeds from the contemporaneous
redemption or payment at Stated Maturity of the Junior Subordinated Debentures.
Redemptions of the Capital Securities shall be made and the Redemption Price
shall be payable on each Redemption Date only to the extent that the Trust has
sufficient funds available for the payment of such Redemption Price. See also
"-- Subordination of Common Securities."
Notice of any redemption will be mailed at least 30 days but not more than
60 days before the Redemption Date to each Holder of Capital Securities to be
redeemed at its registered address. 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 available, the Property Trustee
will deposit irrevocably with The Depository Trust Company ("DTC") or its
nominee funds sufficient to pay the applicable Redemption Price for all
securities held in DTC and will give DTC irrevocable instructions and authority
to pay the Redemption Price to the holders of the Capital Securities. See
"-- Book-Entry Issuance." If any Capital Securities are held in definitive form,
the Trust, to the extent funds are available, will irrevocably deposit with the
paying agent for the Capital Securities held in definitive form funds sufficient
to pay the applicable Redemption Price and will give the paying agent
irrevocable instructions and authority to pay the Redemption Price to the
holders thereof upon surrender of their certificates evidencing the Capital
Securities. Notwithstanding the foregoing, Distributions payable on or prior to
the Redemption Date for any Capital Security called for redemption shall be
payable to the holders of such Capital Security on the relevant record dates for
the related Distribution Dates. If notice of redemption shall have been given
and funds deposited as required, then upon the date of such deposit, all rights
of the holders of such Capital Securities so called for redemption will cease,
except the right of the holders of such Capital Securities to receive the
Redemption Price, but without interest on such Redemption Price, and such
Capital Securities will cease to be outstanding. In the event that any date
fixed for redemption of Capital Securities is not a Business Day, then payment
of the Redemption Price payable on such date will be made on the next succeeding
day which is a Business Day (and without any
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interest or other payment in respect of any such delay), except that, if such
Business Day falls in the next calendar year, such payment will be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on the date such payment was originally payable. In the event that
payment of the Redemption Price in respect of Capital Securities called for
redemption is improperly withheld or refused and not paid either by the Trust or
by the Company pursuant to the Guarantee as described under "Description of
Guarantee," Distributions on such Capital Securities will continue to accrue at
the then applicable rate, from the Redemption Date originally established by the
Trust for the Capital Securities to the date such Redemption Price is actually
paid, in which case the actual payment date will be the date fixed for
redemption for purposes of calculating the Redemption Price.
Subject to applicable law (including, without limitation, United States
federal securities law), the Company 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.
The Trust may not redeem fewer than all of the outstanding Capital
Securities unless all accrued and unpaid distributions have been paid on all
Capital Securities for all quarterly Distribution periods terminating on or
prior to the date of redemption. If less than all of the Capital Securities and
Common Securities issued by the Trust are to be redeemed on a Redemption Date,
then the aggregate amount of such Capital Securities and Common Securities to be
redeemed shall be allocated pro rata among the Capital Securities and the Common
Securities. The particular Capital Securities to be redeemed shall be selected
on a pro rata basis not more than 60 days prior to the Redemption Date by the
Property Trustee from the outstanding Capital Securities not previously called
for redemption, by such method as the Property Trustee shall deem fair and
appropriate and which may provide for the selection for redemption of portions
(equal to $1,000 or integral multiples of $1,000 in excess thereof) of the
liquidation amount of Capital Securities of denominations larger than $1,000.
The Property Trustee shall promptly notify the trust registrar in writing of the
Capital Securities selected for redemption and, in the case of any Capital
Security selected for partial redemption, the liquidation amount thereof to be
redeemed. For all purposes of the Declaration, unless the context otherwise
requires, all provisions relating to the redemption of Capital Securities shall
relate, in the case of any Capital Security redeemed or to be redeemed only in
part, to the portion of the aggregate liquidation amount of Capital Securities
which has been or is to be redeemed.
SUBORDINATION OF COMMON SECURITIES
Payment of Distributions on, and the Redemption Price of, the Capital
Securities and the Common Securities, as applicable, shall be made pro rata
based on the liquidation amount of such Capital Securities and Common
Securities; provided, however, that if on any Distribution Date or Redemption
Date an Indenture Event of Default shall have occurred and be continuing, no
payment of any Distribution on, or Redemption Price of, any of the Common
Securities, and no other payment on account of the redemption, liquidation or
other acquisition of such Common Securities, shall be made unless payment in
full in cash of all accumulated and unpaid Distributions on all of the
outstanding Capital Securities for all Distribution periods terminating on or
prior thereto, or in the case of payment of the Redemption Price the full amount
of such Redemption Price on all of the outstanding Capital Securities then
called for redemption, shall have been made or provided for, and all funds
available to the Property Trustee shall first be applied to the payment in full
in cash of all Distributions on, or Redemption Price of, the Capital Securities
then due and payable.
LIQUIDATION DISTRIBUTION UPON DISSOLUTION
Pursuant to the Declaration, the Trust shall automatically dissolve on the
first to occur of: (i) June 15, 2057, (ii) certain events of bankruptcy,
dissolution or liquidation of the holder of the Common Securities or the Company
or all or substantially all of their properties; (iii) the distribution of the
Junior Subordinated Debentures to the holders of the Capital Securities or
Common Securities; (iv) the redemption of all of the Capital Securities in
connection with the maturity or redemption of all of the Junior Subordinated
Debentures and (v) the entry by a court of competent jurisdiction of a decree of
judicial dissolution of the Company or the Trust.
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If a dissolution occurs as described in clause (ii), (iv) or (v) above, the
Trust shall be liquidated by the Trustees as expeditiously as the Trustees
determine to be possible by distributing, after satisfaction of liabilities to
creditors of the Trust as provided by applicable law, to the holders of the
Capital Securities and Common Securities their pro rata interest in the Junior
Subordinated Debentures, unless such distribution is determined by the Property
Trustee not to be practical, in which event such holders will be entitled to
receive out of the assets of the Trust 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
thereof plus accrued 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
available to pay in full the aggregate Liquidation Distribution, then the
amounts payable directly by the Trust on the Trust Securities shall be paid on a
pro rata basis. The holder(s) of the Common Securities will be entitled to
receive distributions upon any such liquidation pro rata with the holders of the
Capital Securities, except that if an Indenture Event of Default has occurred
and is continuing, the Capital Securities shall have a priority over the Common
Securities.
After the liquidation date is fixed for any distribution of Junior
Subordinated Debentures to holders of the Capital Securities (i) the Capital
Securities will no longer be deemed to be outstanding, (ii) DTC or its nominee,
as a record holder of Capital Securities, will receive a registered global
certificate or certificates representing the Junior Subordinated Debentures to
be delivered upon such distribution and (iii) any certificates representing
Capital 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 Capital Securities, and bearing accrued and unpaid
interest in an amount equal to the accrued and unpaid Distributions on such
Capital Securities until such certificates are presented for cancellation
whereupon the Company will issue to such holder, and the Indenture Trustee will
authenticate, a certificate representing such Junior Subordinated Debentures.
TRUST ENFORCEMENT EVENTS
An Indenture Event of Default constitutes a Trust Enforcement Event under
the Declaration with respect to the Trust Securities, provided that pursuant to
the Declaration, the holder of the Common Securities will be deemed to have
waived any Trust Enforcement Event with respect to the Common Securities until
all Trust Enforcement Events with respect to the Capital Securities have been
cured, waived or otherwise eliminated. Until such Trust Enforcement Event with
respect to the Capital Securities has 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 with respect to
certain matters under the Declaration, and therefore the Indenture.
Upon the occurrence of a Trust Enforcement Event, the Indenture Trustee (as
defined herein) or the Property Trustee as the holder of the Junior Subordinated
Debentures will have the right under the Indenture to declare the principal of
and interest on the Junior Subordinated Debentures to be immediately due and
payable. Each of the Company and the Trust is required to file annually with the
Property Trustee an officer's certificate as to its compliance with all
conditions and covenants under the Declaration.
If the Property Trustee fails to enforce its rights with respect to the
Junior Subordinated Debentures held by the Trust, any record holder of Capital
Securities may institute legal proceedings directly against the Company to
enforce the Property Trustee's rights under such Junior Subordinated Debentures
without first instituting any legal proceedings against such Property Trustee or
any other person or entity. In addition, if a Trust Enforcement Event has
occurred and is continuing and such event is attributable to the failure of the
Company to pay interest, principal or other required payments on the Junior
Subordinated Debentures issued to the Trust on the date such interest, principal
or other payment is otherwise payable, then a record holder of Capital
Securities may, on or after the respective due dates specified in the Junior
Subordinated Debentures, institute a proceeding directly against the Company for
enforcement of payment on Junior Subordinated Debentures having a principal
amount equal to the aggregate liquidation amount of the Capital Securities held
by such holder. In connection with such Direct Action, the Company will be
subrogated to the rights of such
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record holder of Capital Securities to the extent of any payment made by the
Company to such record holder of Capital Securities.
VOTING RIGHTS; AMENDMENT OF THE DECLARATION
Except as provided below and under "Description of Guarantee -- Amendments
and Assignment" and as otherwise required by law and the Declaration, the
holders of the Capital Securities will have no voting rights.
So long as any Junior Subordinated 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 Indenture Trustee or
executing any trust or power conferred on the Property Trustee with respect to
such Junior Subordinated Debentures, (ii) waive any past default that is
waivable under the Indenture, (iii) exercise any right to rescind or annul a
declaration that the principal of all the Junior Subordinated Debentures shall
be due and payable or (iv) consent to any amendment, modification or termination
of the Indenture or such Junior Subordinated Debentures, where such consent
shall be required, without, in each case, obtaining the prior approval of the
holders of a majority in aggregate liquidation amount of all outstanding 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 consent of each holder of Capital Securities. The Trustees shall not
revoke any action previously authorized or approved by a vote of the holders of
the Capital Securities except pursuant to a subsequent vote of the holders of
the Capital Securities. The Property Trustee shall notify each holder of record
of the Capital Securities of any notice of default which it receives with
respect to the Junior Subordinated Debentures. In addition to obtaining the
foregoing approvals of the holders of the Capital Securities, prior to taking
any of the foregoing actions, the Trustees shall receive an opinion of counsel
experienced in such matters to the effect that the Trust will not be classified
as other than a grantor trust for United States federal income tax purposes on
account of such action.
The Declaration may be amended from time to time by the Company and a
majority of the Regular Trustees (and in certain circumstances the Property
Trustee and the Delaware Trustee), without the consent of the holders of the
Capital Securities, (i) to cure any ambiguity, correct or supplement any
provisions in the Declaration that may be inconsistent with any other provision,
or to make any other provisions with respect to matters or questions arising
under the Declaration that 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 as a grantor trust for United States federal income tax purposes
at all times that any Capital Securities and Common 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 such action
shall not adversely affect in any material respect the interests of any holder
of Capital Securities or Common Securities, and any amendments of the
Declaration shall become effective when notice thereof is given to the holders
of Capital Securities and Common Securities. The Declaration may be amended by
the Company and a majority of the Regular Trustees with (i) the consent of
holders representing not less than a majority (based upon liquidation amounts)
of the outstanding Capital Securities and Common Securities and (ii) receipt by
the Regular Trustees of an opinion of counsel to the effect that such amendment
or the exercise of any power granted to the Regular 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, further that
without the consent of each holder of Capital Securities and Common Securities
affected thereby, the Declaration may not be amended to (i) change the amount or
timing of any Distribution on the Capital Securities and Common Securities or
otherwise adversely affect the amount of any Distribution required to be made in
respect of the Capital Securities and Common Securities as of a specified date
or (ii) restrict the right of a holder of Capital Securities or Common
Securities to institute suit for the enforcement of any such payment on or after
such date.
Any required approval of holders of Capital Securities may be given at a
meeting of holders of Capital Securities convened for such purpose or pursuant
to written consent. The Regular 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
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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 Declaration.
No vote or consent of the holders of Capital Securities will be required
for the Trust to redeem and cancel its Capital Securities in accordance with the
Declaration.
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 Company, the Trustees or any affiliate of the
Company or any Trustees, shall, for purposes of such vote or consent, be treated
as if they were not outstanding.
EXPENSES AND TAXES
In the Indenture, the Company, as borrower, has agreed to pay all debts and
other obligations (other than with respect to the Capital Securities) and all
costs and expenses of the Trust (including costs and expenses relating to the
organization of the Trust, the fees and expenses of the Trustees and the costs
and expenses relating to the operation of the Trust) and to pay any and all
taxes and all costs and expenses with respect thereto (other than United States
withholding taxes) to which the Trust might become subject. The foregoing
obligations of the Company under the Indenture are for the benefit of, and shall
be enforceable by, any person to whom any such debts, obligations, costs,
expenses and taxes are owed (a "Creditor") whether or not such Creditor has
received notice thereof. Any such Creditor may enforce such obligations of the
Company directly against the Company, and the Company has irrevocably waived any
right or remedy to require that any such Creditor take any action against the
Trust or any other person before proceeding against the Company. The Company has
also agreed in the Indenture to execute such additional agreements as may be
necessary or desirable to give full effect to the foregoing.
REGISTRAR AND TRANSFER AGENT
The Property Trustee will act as registrar and transfer agent for the
Capital Securities.
Registration of transfers of 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 (i) to register or cause to be
registered the transfer or exchange of the Capital Securities during a period
beginning at the opening of business 15 days before the day of the mailing of
the relevant notice of redemption and ending at the close of business on the day
of mailing of such notice of redemption or (ii) to register or cause to be
registered the transfer or exchange of any Capital Securities so selected for
redemption, except in the case of any Capital Securities being redeemed in part,
any portion thereof not to be redeemed.
INFORMATION CONCERNING THE PROPERTY TRUSTEE
The Property Trustee, other than during the occurrence and continuance of a
Trust Enforcement Event, undertakes to perform only such duties as are
specifically set forth in the Declaration and, after such Trust Enforcement
Event, 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 Declaration at the request of any holder of Capital
Securities unless it is offered reasonable indemnity against the costs, expenses
and liabilities that might be incurred thereby. If no Trust Enforcement Event
has occurred and is continuing and the Property Trustee is required to decide
between alternative causes of action, construe ambiguous provisions in the
Declaration or is unsure of the application of any provision of the Declaration,
and the matter is not one on which holders of Capital Securities are entitled
under the Declaration to vote, then the Property Trustee may, but shall be under
no duty to, take such action as is directed by the Company and, if not so
directed, shall take such action as it deems advisable and in the best interests
of the holders of the Capital Securities and the Common Securities and will have
no liability except for its own bad faith, negligence or willful misconduct.
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PAYMENT AND PAYING AGENCY
Payments in respect of the Global Certificates shall be made to DTC, which
shall credit the relevant accounts at DTC on the applicable Distribution Dates
or, if the Capital Securities are held in definitive form, such payments shall
be made by check mailed to the address of the holder entitled thereto as such
address shall appear on the register maintained by the Property Trustee. The
paying agent (the "Paying Agent") shall initially be the New York affiliate of
The First National Bank of Chicago and any co-paying agent chosen by the
Property Trustee and acceptable to the Regular Trustees and the Company. The
Paying Agent shall be permitted to resign as Paying Agent upon 30 days' written
notice to the Property Trustee and the Company. In the event that the Property
Trustee shall no longer be the Paying Agent, the Regular Trustees shall appoint
a successor (which shall be a bank or trust company acceptable to the Regular
Trustees and the Company) to act as Paying Agent.
MERGERS, CONSOLIDATIONS, AMALGAMATIONS OR REPLACEMENTS OF THE TRUST
The Trust may not merge with or into, consolidate, amalgamate, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other Person, except as
described below. The Trust may, at the request of the Company, with the consent
of the Regular Trustees and without the consent of the holders of the Capital
Securities, merge with or into, consolidate, amalgamate, be replaced by or
convey, transfer or lease its properties and assets substantially as an entirety
to a trust organized as such under the laws of any State; provided that (i) such
successor entity either (a) expressly assumes all of the obligations of the
Trust with respect to the 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
Company expressly appoints a trustee of such successor entity possessing the
same powers and duties as the Property Trustee as the holder of the Junior
Subordinated Debentures, (iii) 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, (iv) 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, (v)
such successor entity has a purpose identical to that of the Trust, (vi) prior
to such merger, consolidation, amalgamation, replacement, conveyance, transfer,
or lease, the Company 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, (1) neither the Trust nor such successor entity
will be required to register as an investment company under the Investment
Company Act and (2) the Trust or the successor entity will continue to be
classified as a grantor trust for United States federal income tax purposes,
(vii) the Company 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, (viii) such successor entity expressly assumes all of the
obligations of the Trust with respect to the Trustees and (ix) 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. Notwithstanding
the foregoing, the Trust shall not, except with the consent of holders of 100%
in aggregate liquidation amount of the Capital Securities, consolidate,
amalgamate, merge with or into, be replaced by or convey, transfer or lease its
properties and assets substantially as an entirety to any other entity or permit
any other entity to consolidate, amalgamate, merge with or into, or replace it
if such consolidation, amalgamation, merger, replacement, conveyance, transfer
or lease would cause the Trust or the successor entity to be classified as other
than a grantor trust for United States federal income tax purposes.
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MERGER OR CONSOLIDATION OF TRUSTEES
Any corporation into which the Property Trustee, the Delaware Trustee or
any Regular Trustee that is not a natural person may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which such Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of such Trustee, shall be the successor of such Trustee under the Declaration,
provided such corporation shall be otherwise qualified and eligible.
MISCELLANEOUS
The Regular 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 other than a grantor trust for United States federal income
tax purposes and so that the Junior Subordinated Debentures will be treated as
indebtedness of the Company for United States federal income tax purposes. In
this connection, the Company and the Regular Trustees are authorized to take any
action, not inconsistent with applicable law, the Certificate of Trust or the
Declaration, that the Company and the Regular 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
Capital Securities.
The Trust may not borrow money nor issue debt nor mortgage or pledge any of
its assets.
DESCRIPTION OF JUNIOR SUBORDINATED DEBENTURES
The Old Junior Subordinated Debentures were issued and the New Junior
Subordinated Debentures are to be issued under a Junior Subordinated Indenture
(the "Indenture"), between the Company and The First National Bank of Chicago,
as trustee (the "Indenture Trustee"). 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, the Indenture.
GENERAL
Concurrently with the issuance of the Old Capital Securities, the Trust
invested the proceeds thereof, together with the consideration paid by the
Company for the Common Securities, in the Old Junior Subordinated Debentures
issued by the Company. Pursuant to the Exchange Offer, the Company will exchange
the Old Junior Subordinated Debentures for the New Junior Subordinated
Debentures as soon as practicable after the Expiration Date. No Old Junior
Subordinated Debentures will remain outstanding after such exchange. The
following is a description of the Junior Subordinated Debentures.
The Junior Subordinated Debentures will be in the principal amount equal to
the aggregate liquidation amount of the Capital Securities plus the Company's
concurrent investment in the Common Securities. The Junior Subordinated
Debentures will bear interest at a variable annual rate of LIBOR plus 0.765% of
the principal amount thereof, payable quarterly in arrears on the fifteenth day
of March, June, September and December of each year (each, an "Interest Payment
Date"), commencing September 15, 1997, to the person in whose name each Junior
Subordinated Debenture is registered, subject to certain exceptions, at the
close of business on the 1st day of the month in which the relevant Interest
Payment Date occurs. 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 Capital
Securities and the Common Securities. The amount of interest payable for any
period will be computed on the actual number of days elapsed in a year of twelve
30-day months. In the event that any date on which interest is payable on the
Junior Subordinated Debentures is not a Business Day, then payment of the
interest payable on such date will be made on the next succeeding day that is a
Business Day (and without any interest or other payment in respect of any such
delay), except that, if such Business Day is in the next succeeding calendar
year, such payment shall be made on the immediately preceding Business Day, in
each case with the same force and
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effect as if made on the date such payment was originally payable. Accrued
interest that is not paid on the applicable Interest Payment Date will bear
additional interest on the amount thereof (to the extent permitted by law) at
the variable rate per annum of LIBOR plus 0.765% thereof, compounded quarterly.
The term "interest" as used herein shall include quarterly interest payments and
interest on quarterly interest payments not paid on the applicable Interest
Payment Date, as applicable.
The Junior Subordinated Debentures will mature on June 15, 2027 (the
"Stated Maturity").
The Junior Subordinated Debentures are unsecured and rank junior and
subordinate in right of payment to all Indebtedness (as defined below) of the
Company. The Indenture does not limit the incurrence or issuance of other
secured or unsecured debt of the Company, whether under the Indenture or any
existing or other indenture that the Company may enter into in the future or
otherwise. See "-- Subordination."
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 Company that may adversely affect holders of the
Junior Subordinated Debentures.
INTEREST
The First National Bank of Chicago, as Calculation Agent (the "Calculation
Agent"), will calculate the interest rate for each quarterly interest period
based on LIBOR determined as of two London Business Days (defined as any day,
other than a Saturday or Sunday, on which banks are open for business in London)
prior to the first day of such interest period (each, a "Determination Date").
"LIBOR" means, with respect to a quarterly interest period relating to an
Interest Payment Date (in the following order of priority):
(i) 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;
(ii) 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 .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;
(iii) 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. If at least two quotations
are provided, LIBOR will be the arithmetic mean (if necessary rounded
upwards to the nearest whole multiple of .00001%) of such quotations;
(iv) if fewer than two such quotations are provided as requested in
clause (iii) 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
as of 11:00 a.m. (London time) on such Determination Date. If at lease two
such quotations are provided, LIBOR will be the arithmetic mean (if
necessary rounded upwards to the nearest whole multiple of .00001%) of such
quotations; and
(v) if fewer than two such quotations are provided as requested in
clause (iv) 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, the
corrected rate as so substituted on the applicable page 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 dividend 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 Investor Relations at the Calculation Agent
at The First National Bank of Chicago, One First National Plaza, Suite 0134,
Chicago, Illinois 60670, or by calling (800) 524-9472 or (312) 407-4660.
OPTION TO EXTEND INTEREST PAYMENT PERIOD
So long as no Indenture Event of Default has occurred and is continuing,
the Company has the right under the Indenture 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 of the Junior
Subordinated Debentures. At the end of such Extension Period, the Company must
pay all interest then accrued and unpaid (together with interest thereon at a
variable annual rate of LIBOR plus 0.765%, compounded quarterly, to the extent
permitted by applicable law). During an Extension Period, interest will continue
to accrue and holders of Junior Subordinated Debentures (or holders of Capital
Securities while the Capital Securities are outstanding) will be required to
accrue interest income for United States federal income tax purposes. See
"Certain United States Federal Income Tax Consequences -- Interest Income and
Original Issue Discount."
During any such Extension Period, the Company may not, and may not permit
any subsidiary of the Company to, (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire, or make a liquidation payment
with respect to, any of the Company's capital stock or (ii) make any payment of
principal, interest or premium, if any, on or repay, repurchase or redeem any
debt securities of the Company that rank pari passu with or junior in interest
to the Junior Subordinated Debentures or make any guarantee payments with
respect to any guarantee by the Company of the debt securities of any subsidiary
of the Company if such guarantee ranks pari passu or junior in interest to the
Junior Subordinated Debentures (other than (a) repurchases, redemptions or other
acquisitions of shares of capital stock of the Company in connection with any
employment contract, benefit plan or other similar arrangement with or for the
benefit of any one or more employees, officers, directors or consultants or in
connection with a dividend reinvestment or stockholder stock purchase plan, (b)
as a result of an exchange or conversion of any class or series of the Company's
capital stock (or any capital stock of a subsidiary of the Company) for any
class or series of the Company's capital stock or of any class or series of the
Company's indebtedness for any class or series of the Company's capital stock,
(c) 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, (d) any declaration of a dividend in
connection with the adoption of any stockholder's rights plan, or the issuance
of rights, stock or other property under any stockholder's rights plan, or the
redemption or repurchase of rights pursuant thereto, or (e) any dividend in the
form of stock, warrants, options or other rights where the dividend stock or the
stock issuable upon exercise of such warrants, options or other rights is the
same stock as that on which the dividend is being paid or ranks pari passu with
or junior to such stock). Prior to the termination of any such Extension Period,
the Company may further extend the Extension Period, provided that no Extension
Period may exceed 20 consecutive quarterly periods or extend beyond the Stated
Maturity of the Junior Subordinated Debentures. Upon the termination of any such
Extension Period and the payment of all amounts then due on any Interest Payment
Date, the Company 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 Company must give the Property Trustee, the
Regular Trustees and the Indenture Trustee notice of its election of such
Extension Period not less than one Business Day prior to such record date. The
Property Trustee shall give notice of the Company's election to begin a new
Extension Period to the holders of the Capital Securities.
REDEMPTION
The Junior Subordinated Debentures are not redeemable prior to June 15,
2007 unless a Special Event has occurred. The Junior Subordinated Debentures are
redeemable prior to maturity at the option of the Company, subject to the
receipt of any necessary prior approval of the Federal Reserve, on or after June
15,
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2007, in whole or in part, at any time at a redemption price equal to 100% of
the principal amount of the Junior Subordinated Debentures to be redeemed plus
any accrued but unpaid interest (including any Additional Interest), if any, to
the date of redemption.
The Junior Subordinated Debentures are also redeemable at any time in whole
(but not in part) at a redemption price (the "Special Event Prepayment Price")
equal to 100% of the principal amount of such Junior Subordinated Debentures
plus accrued but unpaid interest thereon to the date of prepayment.
If the Junior Subordinated Debentures are redeemed, the Trust must redeem
the Capital Securities having an aggregate liquidation amount equal to the
aggregate principal amount of Junior Subordinated Debentures so redeemed. See
"Description of Capital Securities -- Redemption -- Mandatory Redemption."
Notice of any redemption will be mailed at least 30 days (provided that the
Indenture Trustee shall itself have received notice not less than 45 days prior
to the redemption date) but not more than 60 days before the redemption date to
each Holder of Junior Subordinated Debentures to be redeemed at its registered
address. Unless the Company defaults in payment of the redemption price, on and
after the redemption date interest ceases to accrue on such Junior Subordinated
Debentures or portions thereof called for redemption.
CERTAIN COVENANTS OF THE COMPANY
The Company has covenanted in the Indenture that if and so long as the
Trust is the holder of all Junior Subordinated Debentures, the Company, as
borrower, will pay to the Trust all fees and expenses 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 (including any taxes,
duties, assessments or governmental charges of whatever nature (other than
withholding taxes) imposed by the United States or any domestic taxing authority
upon the Trust but excluding obligations under the Capital Securities).
The Company has also covenanted that it will not, and will not permit any
subsidiary of the Company to, (i) declare or pay any dividends or distributions
on, or redeem, purchase, acquire, or make a liquidation payment with respect to,
any of the Company's capital 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 interest to the
Junior Subordinated Debentures or make any guarantee payments with respect to
any guarantee by the Company of the debt securities of any subsidiary of the
Company if such guarantee ranks pari passu with or junior in interest to the
Junior Subordinated Debentures (other than (a) repurchases, redemptions or other
acquisitions of shares of capital stock of the Company in connection with any
employment contract, benefit plan or other similar arrangement with or for the
benefit of any one or more employees, officers, directors or consultants or in
connection with a dividend reinvestment or stockholder stock purchase plan, (b)
as a result of an exchange or conversion of any class or series of the Company's
capital stock (or any capital stock of a subsidiary of the Company) for any
class or series of the Company's capital stock or of any class or series of the
Company's indebtedness for any class or series of the Company's capital stock,
(c) 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, (d) any declaration of a dividend in
connection with the adoption of any stockholder's rights plan, or the issuance
of rights, stock or other property under any stockholder's rights plan, or the
redemption or repurchase of rights pursuant thereto, or (e) any dividend in the
form of stock, warrants, options or other rights where the dividend stock or the
stock issuable upon exercise of such warrants, options or other rights is the
same stock as that on which the dividend is being paid or ranks pari passu with
or junior to such stock) if at such time (x) there shall have occurred any event
of which the Company has actual knowledge that (I) with the giving of notice or
the lapse of time, or both, would constitute an Indenture Event of Default with
respect to Junior Subordinated Debentures and (II) in respect of which the
Company shall not have taken reasonable steps to cure, (y) the Company shall be
in default with respect to its payment of any obligations under the Guarantee or
(z) the Company shall have given notice of its election of an Extension Period
as provided in the Indenture and shall not have rescinded such notice, or such
Extension Period, or any extension thereof, shall be continuing.
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SUBORDINATION
In the Indenture, the Company has covenanted and agreed that any Junior
Subordinated Debentures issued thereunder will be subordinated and junior in
right of payment to all 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 Company, the holders of Indebtedness will first be
entitled to receive payment in full of principal of and premium, if any, and
interest, if any, on such Indebtedness before the holders of Junior Subordinated
Debentures or the Property Trustee on behalf of the holders of Capital
Securities will be entitled to receive or retain any payment in respect of the
principal of and premium, if any, or interest, if any, on the Junior
Subordinated Debentures; provided, however, that holders of Indebtedness shall
not be entitled to receive payment of any such amounts to the extent that such
holders would be required by the subordination provisions of such Indebtedness
to pay such amounts over to the obligees on trade accounts payable or other
liabilities arising in the ordinary course of the Company's business.
In the event of the acceleration of the maturity of any Junior Subordinated
Debentures, the holders of all Indebtedness outstanding at the time of such
acceleration will first be entitled to receive payment in full of all amounts
then due thereon (including any amounts due upon acceleration) before the
holders of Junior Subordinated Debentures will be entitled to receive or retain
any payment in respect of the principal of or premium, if any, or interest, if
any, on the Junior Subordinated Debentures; provided, however, that holders of
Indebtedness shall not be entitled to receive payment of any such amounts to the
extent that such holders would be required by the subordination provisions of
such Indebtedness to pay such amounts over to the obligees on trade accounts
payable or other liabilities arising in the ordinary course of the Company's
business.
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
Indebtedness, or an event of default with respect to any Indebtedness resulting
in the acceleration of the maturity thereof, or if any judicial proceeding shall
be pending with respect to any such default.
"Indebtedness" means with respect to any person, whether recourse is to all
or a portion of the assets of such person and whether or not contingent, (i)
every obligation of such person for money borrowed; (ii) every obligation of
such person evidenced by bonds, debentures, notes or other similar instruments,
including obligations incurred in connection with the acquisition of property,
assets or businesses; (iii) every reimbursement obligation of such person with
respect to letters of credit, bankers' acceptances or similar facilities issued
for the account of such person; (iv) every obligation of such person issued or
assumed as the deferred purchase price of property or services (but excluding
trade accounts payable or accrued liabilities arising in the ordinary course of
business); (v) every capital lease obligation of such person; (vi) every
obligation of such person for claims (as defined in Section 101(4) of the United
States Bankruptcy Code of 1978, as amended) in respect of derivative products
such as interest and foreign exchange rate contracts, commodity contracts and
similar arrangements; and (vii) every obligation of the type referred to in
clauses (i) through (vi) of another person and all dividends of another person
the payment of which, in either case, such person has guaranteed or is
responsible or liable, directly or indirectly, as obligor or otherwise; provided
that "Indebtedness" shall not include (i) any obligations which, by their terms,
are expressly stated to rank pari passu in right of payment with, or to not be
superior in right of payment to, the Junior Subordinated Debentures, (ii) any
Indebtedness of the Company which when incurred and without respect to any
election under Section 1111(b) of the United States Bankruptcy Code of 1978, as
amended, was without recourse to the Company, (iii) any Indebtedness of the
Company to any of its subsidiaries, (iv) Indebtedness to any employee of the
Company or (v) any indebtedness in respect of debt securities issued to any
trust, or a trustee of such trust, partnership or other entity affiliated with
the Company that is a financing entity of the Company in connection with the
issuance of such financing entity of securities that are similar to the Capital
Securities.
The Indenture places no limitation on the amount of additional Indebtedness
that may be incurred by the Company or any indebtedness or other liabilities
that may be incurred by the Company's subsidiaries. As of
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June 30, 1997, Indebtedness of the Company aggregated approximately $152
million, and the Company's consolidated subsidiaries had indebtedness and other
liabilities of approximately $9.9 billion to which the Junior Subordinated
Debentures would be effectively subordinated.
INDENTURE EVENTS OF DEFAULT
The Indenture provides that any one or more of the following described
events with respect to the Junior Subordinated Debentures that has occurred and
is continuing constitutes an "Indenture Event of Default" with respect to the
Junior Subordinated Debentures:
(i) failure for 30 days to pay any interest on the Junior Subordinated
Debentures when due (subject to the deferral of any due date in the case of
an Extension Period); or
(ii) failure to pay any principal on the Junior Subordinated
Debentures when due whether at maturity, upon redemption by declaration or
otherwise; or
(iii) failure to observe or perform in any material respect certain
other covenants contained in the Indenture for 90 days after written notice
to the Company from the Indenture Trustee or the holders of at least 25% in
aggregate outstanding principal amount of outstanding Junior Subordinated
Debentures; or
(iv) certain events in bankruptcy, insolvency or reorganization of the
Company.
The holders of a majority in aggregate outstanding principal amount of
Junior Subordinated Debentures have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Indenture
Trustee. The Indenture Trustee or the holders of not less than 25% in aggregate
outstanding principal amount of Junior Subordinated Debentures may declare the
principal due and payable immediately upon an Indenture Event of Default, and,
should the Indenture Trustee or such holders of such Junior Subordinated
Debentures fail to make such declaration, the holders of at least 25% in
aggregate liquidation amount of the Capital Securities shall have such right.
The holders of a majority in aggregate outstanding principal amount of Junior
Subordinated Debentures may annul such declaration and waive the default if the
default (other than the non-payment of the principal of 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 Indenture Trustee,
and should the holders of such Junior Subordinated Debentures fail to annul such
declaration and waive such default, the holders of a majority in aggregate
liquidation amount of the Capital Securities shall have such right.
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 interest (unless such default has been cured and
a sum sufficient to pay all matured installments of interest and principal due
otherwise than by acceleration has been deposited with the Indenture 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 Debentures, and should the holders of such Junior
Subordinated Debentures fail to waive such default, the holders of a majority in
aggregate liquidation amount of the Capital Securities shall have such right.
The Company is required to file annually with the Indenture Trustee a
certificate as to whether or not the Company is in compliance with all the
conditions and covenants applicable to it under the Indenture.
In case an Indenture Event of Default shall occur and be continuing, the
Property Trustee will have the right to declare the principal of and the
interest on such Junior Subordinated Debentures and any other amounts payable
under the Indenture, to be forthwith due and payable and to enforce its other
rights as a creditor with respect to such Junior Subordinated Debentures.
ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF CAPITAL SECURITIES
If an Indenture Event of Default has occurred and is continuing and such
event is attributable to the failure of the Company to pay interest or principal
on the Junior Subordinated Debentures on the date such
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interest or principal is otherwise payable, a holder of Capital Securities may
institute a Direct Action for payment. The Company 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. Notwithstanding any
payment made to such holder of Capital Securities by the Company in connection
with a Direct Action, the Company shall remain obligated to pay the principal of
or interest on the Junior Subordinated Debentures held by the Trust or the
Property Trustee and the Company 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 Company to such holder in any Direct
Action. The holders of Capital Securities will not be able to exercise directly
any other remedy available to the holders of the Junior Subordinated Debentures.
CONSOLIDATION, MERGER, SALE OF ASSETS AND OTHER TRANSACTIONS
The Indenture provides that the Company shall not consolidate with or merge
into any other Person or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, unless (i) in case the Company
consolidates with or merges into another Person or conveys, transfers or leases
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
Company's obligations on the Junior Subordinated Debentures issued under the
Indenture; (ii) immediately after giving effect thereto, no Indenture Event of
Default, and no event which, after notice or lapse of time or both, would become
an Indenture Event of Default, shall have happened and be continuing; (iii) if
at the time any Capital Securities are outstanding, such transaction is
permitted under the Declaration and Guarantee and does not give rise to any
breach or violation of the Declaration or Guarantee, (iv) any such lease shall
provide that it will remain in effect so long as any Junior Subordinated
Debentures are outstanding, and (v) certain other conditions as prescribed in
the Indenture are met.
MODIFICATION OF INDENTURE
From time to time the Company and the Indenture Trustee may, without the
consent of the holders of the 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 Company and the Indenture Trustee, with the consent of the
holders of not less than a majority in principal amount of outstanding Junior
Subordinated Debentures affected, to modify the Indenture in a manner affecting
the rights of the holders of such Junior Subordinated Debentures; provided that
no such modification may, without the consent of the holder of each outstanding
Junior Subordinated Debentures so affected, (i) change the stated maturity of
Junior Subordinated Debentures, or reduce the principal amount thereof, or
reduce the rate or extend the time of payment of interest thereon (except such
extension as is contemplated hereby) 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, provided that, so long as any
Capital Securities remain outstanding, no such modification may be made that
adversely affects the holders of such Capital Securities in any material
respect, and no termination of the Indenture may occur, and no waiver of any
Indenture Event of Default or compliance with any covenant under the Indenture
may be effective, without the prior consent of the holders of at least a
majority of the aggregate liquidation amount of the outstanding Capital
Securities unless and until the principal of the Junior Subordinated Debentures
and all accrued and unpaid interest thereon have been paid in full and certain
other conditions are satisfied.
DEFEASANCE AND DISCHARGE
The Indenture provides that the Company, at the Company's option: (a) will
be discharged from any and all obligations in respect of the Junior Subordinated
Debentures (except for certain obligations to register the transfer or exchange
of Junior Subordinated Debentures, replace stolen, lost or mutilated Junior
Subordinated Debentures, maintain paying agencies and hold moneys for payment in
trust) or (b) need not comply with
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certain restrictive covenants of the Indenture (including that described in the
second paragraph under "Certain Covenants of the Company"), in each case if the
Company deposits, in trust with the Indenture Trustee or a defeasance agent,
money or U.S. Government Obligations which through the payment of interest
thereon and principal thereof in accordance with their terms will provide money,
in an amount sufficient to pay all the principal of, and interest and premium,
if any, on the Junior Subordinated Debentures on the dates such payments are due
in accordance with the terms of such Junior Subordinated Debentures. To exercise
any such option, the Company is required to deliver to the Indenture Trustee or
a defeasance agent, if any, an opinion of counsel to the effect that the deposit
and related defeasance would not cause the holders of the Junior Subordinated
Debentures to recognize income, gain or loss for United States federal income
tax purposes and, in the case of a discharge pursuant to clause (a), such
opinion shall be accompanied by a private letter ruling to such effect received
by the Company from the United States Internal Revenue Service or revenue ruling
pertaining to a comparable form of transaction to such effect published by the
United States Internal Revenue Service.
DISTRIBUTIONS OF JUNIOR SUBORDINATED DEBENTURES; BOOK-ENTRY ISSUANCE
Under certain circumstances involving the termination of the Trust, Junior
Subordinated Debentures may be distributed to the holders of the Capital
Securities in liquidation of the Trust after satisfaction of liabilities to
creditors of the Trust as provided by applicable law. If distributed to holders
of Capital Securities in liquidation, the Junior Subordinated Debentures will
initially be issued in the form of global securities. DTC, or any successor
depositary, will act as depositary for such global securities. It is anticipated
that the depositary arrangements for such global securities would be
substantially identical to those in effect for the Capital Securities. For a
description of such procedures, see "Book-Entry Issuance."
There can be no assurance as to the market price of any Junior Subordinated
Debentures that may be distributed to the holders of Capital Securities.
PAYMENT AND PAYING AGENTS
The Company initially will act as Paying Agent with respect to the Junior
Subordinated Debentures except that, if the Junior Subordinated Debentures are
distributed to the holders of the Capital Securities in liquidation of such
holders' interests in the Trust, the Indenture Trustee will act as the Paying
Agent. The Company at any time may designate additional Paying Agents or rescind
the designation of any Paying Agent or approve a change in the office through
which any Paying Agent acts, except that the Company will be required to
maintain a Paying Agent at the place of payment.
Any moneys deposited with the Indenture Trustee or any Paying Agent, or
then held by the Company in trust, for the payment of the principal of and
premium, if any, or interest on any Junior Subordinated Debentures 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 Company, be repaid to
the Company and the holder of such Junior Subordinated Debentures shall
thereafter look, as a general unsecured creditor, only to the Company for
payment thereof.
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 INDENTURE TRUSTEE
The Indenture Trustee shall have and be subject to all the duties and
responsibilities specified with respect to an indenture trustee under the Trust
Indenture Act. Subject to such provisions, the Indenture 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 Indenture Trustee is not required to
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expend or risk its own funds or otherwise incur personal financial liability in
the performance of its duties if the Indenture Trustee reasonably believes that
repayment or adequate indemnity is not reasonably assured to it.
DESCRIPTION OF GUARANTEE
The Old Guarantee was executed and delivered by the Company concurrently
with the issuance by the Trust of the Old Capital Securities for the benefit of
the holders from time to time of the Capital Securities. As soon as practicable
after the Expiration Date, the Old Guarantee will be exchanged by the Company
for the New Guarantee. The First National Bank of Chicago will act as guarantee
trustee ("Guarantee Trustee") under the New Guarantee. This summary of certain
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. The Guarantee
Trustee will hold the New Guarantee for the benefit of the holders of the
Capital Securities.
GENERAL
The Company has irrevocably and unconditionally agreed to pay in full on a
subordinated basis, to the extent set forth herein, the Guarantee Payments (as
defined below) to the holders of the 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 the Capital
Securities, to the extent that the Trust has funds on hand available therefor at
the time, (ii) the redemption price with respect to any Capital Securities
called for redemption, to the extent that the Trust has funds on hand available
therefor at such time, or (iii) upon a voluntary or involuntary dissolution,
winding up or 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 accrued and unpaid
Distributions to the date of payment and (b) the amount of assets of the Trust
remaining available for distribution to holders of Capital Securities. The
Company's obligation to make a Guarantee Payment may be satisfied by direct
payment of the required amounts by the Company to the holders of the applicable
Capital Securities or by causing the Trust to pay such amounts to such holders.
The Guarantee is an irrevocable guarantee on a subordinated basis of the
Trust's obligations under the Capital Securities, but will apply only to the
extent that the Trust has funds on hand available to make such payments, and is
not a guarantee of collection.
If the Company does not make interest payments on the Junior Subordinated
Debentures held by the Trust, the Trust will not be able to pay Distributions on
the Capital Securities and will not have funds legally available therefor. The
Guarantee will rank subordinate and junior in right of payment to all general
liabilities of the Company. See "-- Status of the Guarantee." The Guarantee does
not limit the incurrence or issuance of other secured or unsecured debt of the
Company, whether under the Indenture or any existing or other indenture that the
Company may enter into in the future or otherwise.
The Company has, through the Guarantee, the Junior Subordinated Debentures
and the Indenture, taken together, fully and unconditionally guaranteed 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 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 --
General."
STATUS OF THE GUARANTEE
The Guarantee constitutes an unsecured obligation of the Company and ranks
subordinate and junior in right of payment to Indebtedness of the Company. The
Guarantee does not place a limitation on the amount of additional Indebtedness
that may be incurred by the Company.
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The Guarantee constitutes a guarantee of payment and not of collection
(i.e., the guaranteed party may institute a legal proceeding directly against
the Guarantor to enforce its rights under the 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 of the Junior
Subordinated Debentures to the holders of the Capital Securities in exchange for
all of the Capital Securities.
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 will be
required), the Guarantee may not be amended without the prior approval of the
holders of not less than a majority of the aggregate liquidation amount of the
outstanding Capital Securities. The manner of obtaining any such approval will
be as set forth under "Description of Capital Securities -- Voting Rights;
Amendment of the Declaration." All guarantees and agreements contained in the
Guarantee shall bind the successors, assigns, receivers, trustees and
representatives of the Company 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
Company to perform any of its payment or other obligations thereunder. The
holders of not less than a majority in aggregate 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 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 Company 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 Company, as guarantor, is required to file annually with the Guarantee
Trustee a certificate as to whether or not the Company 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 Company in performance of the Guarantee, undertakes to perform
only such duties as are specifically set forth in each 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 is under no obligation
to exercise any of the powers vested in it by the Guarantee at the request of
any holder of any Capital Security 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 redemption price of all of the Capital Securities, upon full
payment of the amounts payable upon liquidation of the Trust or upon
distribution of Junior Subordinated Debentures to the holders of the Capital
Securities in exchange for all 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.
GOVERNING LAW
The Guarantee will be governed by and construed in accordance with the laws
of the State of New York.
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DESCRIPTION OF THE OLD SECURITIES
The terms of the Old Securities are identical in all material respect to
the New Securities, except that the Old Securities have not been registered
under the Securities Act, are subject to certain restrictions on transfer and
are entitled to certain rights under the Registration Rights Agreement (which
rights will terminate upon consummation of the Exchange Offer, except under
limited circumstances). Holders of Old Capital Securities should review the
information set forth under "Risk Factors -- Certain Consequences of a Failure
to Exchange Old Capital Securities."
RELATIONSHIP AMONG THE CAPITAL SECURITIES,
THE JUNIOR SUBORDINATED DEBENTURES AND THE GUARANTEE
Payments of Distributions and other amounts due on the Capital Securities
(to the extent the Trust has funds available for the payment of such
Distributions) are irrevocably guaranteed by the Company as and to the extent
set forth under "Description of Guarantee." If and to the extent that the
Company does not make payments under the Junior Subordinated Debentures, the
Trust will not pay Distributions or other amounts due on the Capital Securities.
The Guarantee does not cover payment of Distributions when the Trust does not
have sufficient funds to pay such Distributions. A holder of Capital Securities
may institute a legal proceeding directly against the Company to enforce payment
of such Distributions to such holder after the respective due dates. Taken
together, the Company's obligations under the Junior Subordinated Debentures,
the Indenture and the Guarantee provide, in the aggregate, a full 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 and unconditional guarantee of the Trust's
obligations under the Capital Securities. The obligations of the Company under
the Guarantee and the Junior Subordinated Debentures are subordinate and junior
in right of payment to all Indebtedness of the Company.
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 of the Junior Subordinated Debentures
will be equal to the sum of the aggregate stated liquidation amount of the
Capital Securities and the 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
related Capital Securities; (iii) the Company shall pay for all and any costs,
expenses and liabilities of the Trust except the Trust's obligations under the
Capital Securities; and (iv) the Declaration further provides that the Trust
will not engage in any activity that is not consistent with the limited purposes
of the Trust.
Notwithstanding anything to the contrary in the Indenture, the Company has
the right to set-off any payment it is otherwise required to make thereunder
with and to the extent the Company has theretofore made, or is concurrently on
the date of such payment making, a payment under the Guarantee.
ENFORCEMENT RIGHTS OF HOLDERS OF CAPITAL SECURITIES
A holder of Capital Securities may institute a legal proceeding directly
against the Company 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 Indebtedness of the Company will
not constitute a default or Indenture Event of Default. In addition, in the
event of payment defaults under, or acceleration of, Indebtedness of the
Company, the subordination provisions of the Indenture provide that no payments
may be made in respect of the Junior Subordinated Debentures until such
Indebtedness has been paid in full or any payment default thereunder has been
cured or waived. Failure to make required payments on the Junior Subordinated
Debentures would constitute an Indenture Event of Default under the Indenture.
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LIMITED PURPOSE OF TRUST
The Capital Securities evidence a beneficial interest in the Trust, and the
Trust exists for the sole purpose of issuing the Capital Securities and the
Common Securities and investing the proceeds thereof in Junior Subordinated
Debentures. A principal difference between the rights of a holder of Capital
Securities and a holder of Junior Subordinated Debentures is that a holder of
Junior Subordinated Debentures is entitled to receive from the Company the
principal amount of and interest accrued on Junior Subordinated Debentures held,
while a holder of Capital Securities is entitled to receive Distributions from
the Trust (or from the Company under the Guarantee) if and to the extent the
Trust has funds available for the payment of such Distributions.
RIGHTS UPON TERMINATION
Upon any voluntary or involuntary termination, winding-up or liquidation of
the Trust involving the liquidation of the Junior Subordinated Debentures, the
holders of the Capital Securities will be entitled to receive, out of assets
held by the Trust, the liquidation distribution in cash. See "Description of
Capital Securities -- Liquidation Distribution Upon Dissolution." Upon any
voluntary or involuntary liquidation or bankruptcy of the Company, the Property
Trustee, as holder of the Junior Subordinated Debentures, would be a
subordinated creditor of the Company, subordinated in right of payment to all
Indebtedness, but entitled to receive payment in full of principal and interest
before any stockholders of the Company receive payments or distributions. Since
the Company is the guarantor under the Guarantee and has agreed to pay for all
costs, expenses and liabilities of the Trust (other than the Trust's obligations
to the holders of the Capital Securities), the positions of a holder of Capital
Securities and a holder of the Junior Subordinated Debentures relative to other
creditors and to stockholders of the Company in the event of liquidation or
bankruptcy of the Company would be substantially the same.
CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
In the opinion of Simpson Thacher & Bartlett, special United States federal
income tax counsel to the Company and the Trust ("Tax Counsel"), the following
summary accurately describes the material United States federal income tax
consequences that may be relevant to the purchase, ownership and disposition of
the Capital Securities. Unless otherwise stated, this summary deals only with
Capital Securities held as capital assets by United States persons (defined
below) who purchase the Capital Securities upon original issuance. As used
herein, a "United States person" means (i) a person that is a citizen or
resident of the United States, (ii) a corporation, partnership or other entity
created or organized in or under the laws of the United States or any political
subdivision thereof, (iii) an estate the income of which is subject to United
States federal income taxation regardless of its source, or (iv) a trust if a
court within the United States is able to exercise primary supervision over the
administration of such trust and one or more United States fiduciaries have the
authority to control all the substantial decisions of such trust. The tax
treatment of a holder may vary depending on such holder's particular situation.
This summary does not address all the tax consequences that may be relevant to a
particular holder or to holders who may be subject to special tax treatment,
such as banks, real estate investment trusts, regulated investment companies,
insurance companies, dealers in securities or currencies, or tax-exempt
investors. In addition, this summary does not include any description of any
alternative minimum tax consequences or the tax laws of any state, local or
foreign government that may be applicable to a holder of Capital Securities.
This summary is based on the Internal Revenue Code of 1986, as amended (the
"Code"), the Treasury regulations promulgated thereunder and administrative and
judicial interpretations thereof, as of the date hereof, all of which are
subject to change, possibly on a retroactive basis. The authorities on which
this summary is based are subject to various interpretations and the opinions of
Tax Counsel are not binding on the Internal Revenue Service ("IRS") or the
courts, either of which could take a contrary position. Moreover, no rulings
have been or will be sought from the IRS with respect to the transactions
described herein. Accordingly, there can be no assurance that the IRS will not
challenge the opinions expressed herein or that a court would not sustain such a
challenge. Nevertheless, Tax Counsel has advised that it is of the view that, if
challenged, the opinions expressed herein would be sustained by a court with
jurisdiction in a properly presented case.
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HOLDERS SHOULD CONSULT THEIR OWN 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. FOR A DISCUSSION OF THE POSSIBLE REDEMPTION OF THE CAPITAL
SECURITIES UPON THE OCCURRENCE OF CERTAIN TAX EVENTS SEE "DESCRIPTION OF CAPITAL
SECURITIES -- REDEMPTION -- SPECIAL EVENT REDEMPTION OR DISTRIBUTION OF JUNIOR
SUBORDINATED DEBENTURES."
TAX CONSEQUENCES OF THE EXCHANGE
The Exchange will not be a taxable event for United States federal income
tax purposes. Accordingly, holders who exchange their Old Capital Securities for
New Capital Securities pursuant to the Exchange Offer will not recognize any
gain or loss on such exchange for such purposes, such exchanging holders will
have a tax basis in their New Capital Securities that is equal to the adjusted
tax basis they had in their Old Capital Securities immediately before the
Exchange and the holding period for their New Capital Securities will include
the period during which they held their Old Capital Securities.
CLASSIFICATION OF THE TRUST
In connection with the issuance of the Capital Securities, Tax Counsel is
of the opinion that under current law and assuming full compliance with the
terms of the Declaration, the Trust will be classified as a grantor trust for
United States federal income tax purposes and not as an association taxable as a
corporation. Accordingly, for United States federal income tax purposes, each
beneficial owner (a "holder") of Capital Securities generally will be considered
the owner of an undivided interest in the Junior Subordinated Debentures and,
thus, will be required to include in gross income its allocable share of the
income paid or accrued on the Junior Subordinated Debentures.
CLASSIFICATION OF THE JUNIOR SUBORDINATED DEBENTURES
The Company, the Trust and the holders of the Capital Securities (by
acceptance of a beneficial interest in a Capital Security) will agree to treat
the Junior Subordinated Debentures as indebtedness for all United States tax
purposes. In connection with the issuance of the Junior Subordinated Debentures,
Tax Counsel is of the opinion that, under current law, and based on certain
representations, facts and assumptions set forth in such opinion, the Junior
Subordinated Debentures will be classified as indebtedness for United States
federal income tax purposes.
INTEREST INCOME AND ORIGINAL ISSUE DISCOUNT
Under the applicable Treasury regulations, the Junior Subordinated
Debentures will not be treated as issued with original issue discount ("OID")
within the meaning of Section 1273(a) of the Code. Accordingly, except as set
forth below, the stated interest on the Junior Subordinated Debentures generally
will be taxable to a holder of Capital Securities as ordinary income at the time
it is paid or accrued in accordance with such holder's regular method of tax
accounting.
If, however, the Company exercises its right to defer payments of interest
on the Junior Subordinated Debentures, the Junior Subordinated Debentures will
become OID instruments at such time and all holders of Capital Securities will
be required to accrue their allocable share of the stated interest (and de
minimis OID, if any) on the Junior Subordinated Debentures on a daily economic
accrual basis (using the constant-yield-to-maturity method of accrual described
in Section 1272 of the Code) during the Extension Period even though the Company
will not pay such interest until the end of the Extension Period, and even
though some holders may use the cash method of tax accounting. Moreover,
thereafter the Junior Subordinated Debentures will be taxed as OID instruments
for as long as they remain outstanding. Thus, even after the end of an Extension
Period, all holders would be required to continue to include their allocable
share of the stated interest (and de minimis OID, if any) on the Junior
Subordinated Debentures in income on a daily economic accrual basis, regardless
of their method of tax accounting and in advance of receipt of the cash
attributable to such income. Under the OID economic accrual rules, a holder
would accrue an amount of interest income each year that
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approximates the stated amount of Distributions called for under the terms of
the Capital Securities, and actual cash payments in respect of such
Distributions would not be reported separately as taxable income. Any amount of
OID included in a holder's gross income (whether or not during an Extension
Period) with respect to a Capital Security will increase such holder's adjusted
tax basis in such Capital Security, and the amount of Distributions received by
a holder in respect of such accrued OID will reduce the adjusted tax basis of
such Capital Security.
The Treasury regulations described above have not yet been addressed in any
rulings or other interpretations by the Internal Revenue Service ("IRS"), and it
is possible that the IRS could take a contrary position. If the IRS were to
assert successfully that the stated interest on the Junior Subordinated
Debentures was OID regardless of whether the Company exercises its option to
defer payments of interest on such debentures, all holders of Capital Securities
would be required to include such stated interest in income on a daily economic
accrual basis as described above.
Corporate holders of Capital Securities will not be entitled to a
dividends-received deduction with respect to any income recognized by such
holders with respect to the Capital Securities.
DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES OR CASH UPON LIQUIDATION OF THE
TRUST
As described under the caption "Description of Junior Subordinated
Debentures -- Distribution of Junior Subordinated Debentures," Junior
Subordinated Debentures may be distributed to holders in exchange for the
Capital Securities and in liquidation of the Trust. Under current law, such a
distribution would be non-taxable, and will result in the holder receiving
directly its pro rata share of the Junior Subordinated Debentures previously
held indirectly through the Trust, with a holding period and aggregate tax basis
equal to the holding period and aggregate tax basis such holder had in its
Capital Securities before such distributions. If, however, the liquidation of
the Trust were to occur because the Trust is subject to United States federal
income tax with respect to income accrued or received on the Junior Subordinated
Debentures, the distribution of the Junior Subordinated Debentures to holders
would be a taxable event to the Trust and to each holder and a holder would
recognize gain or loss as if the holder had exchanged its Capital Securities for
the Junior Subordinated Debentures it received upon liquidation of the Trust.
A holder would accrue interest in respect of the Junior Subordinated
Debentures received from the Trust in the manner described above under
"-- Interest Income and Original Issue Discount."
Under certain circumstances described herein (see "Description of Capital
Securities -- Special Event Redemption or Distribution of Junior Subordinated
Debentures"), the Junior Subordinated Debentures may be redeemed for cash, with
the proceeds of such redemption distributed to holders in redemption of their
Capital Securities. Under current law, such a redemption would constitute a
taxable disposition of the redeemed Capital Securities for United States federal
income tax purposes, and a holder would 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 will recognize gain or loss equal to
the difference between the amount realized by the holder on the sale or
redemption of the Capital Securities (except to the extent that such amount
realized is characterized as a payment in respect of accrued but unpaid interest
on such holder's allocable share of the Junior Subordinated Debentures that such
holder has not included in gross income previously) and the holder's adjusted
tax basis in the Capital Securities sold or redeemed. 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. The Taxpayer Relief Act of 1997 generally reduces the tax rates on capital
gains recognized by individuals on the sale or other taxable disposition of
capital assets held for more than 18 months. Holders are advised to consult with
their own tax advisors as to the consequences in their particular circumstances
of the capital gain provisions of the Taxpayer Relief Act of 1997. Subject to
certain limited exceptions, capital losses cannot be applied to offset ordinary
income for United States federal income tax purposes.
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NON-UNITED STATES HOLDERS
As used herein, the term "Non-United States Holder" means any holder that
is not a "United States person". As discussed above, the Capital Securities will
be treated as evidence of an indirect beneficial ownership interest in the
Junior Subordinated Debentures. See "-- Classification of the Trust." Thus,
under present United States federal income tax law, and subject to the
discussion below concerning backup withholding:
(a) no withholding of United States federal income tax will be
required with respect to the payment by the Company or any paying agent of
principal or interest (which for purposes of this discussion includes any
OID) with respect to the Capital Securities (or on the Junior Subordinated
Debentures) to a Non-United States Holder, provided (i) that the beneficial
owner of the Capital Securities (or Junior Subordinated Debentures)
("Beneficial Owner") does not actually or constructively own 10% or more of
the total combined voting power of all classes of stock of the Company
entitled to vote within the meaning of Section 871(h)(3) of the Code and
the regulations thereunder, (ii) the Beneficial Owner is not a controlled
foreign corporation that is related to the Company through stock ownership,
(iii) the Beneficial Owner is not a bank whose receipt of interest with
respect to the Capital Securities (or on the Junior Subordinated
Debentures) is described in Section 881(c)(3)(A) of the Code and (iv) the
Beneficial Owner satisfies the statement requirement (described generally
below) set forth in Section 871(h) and Section 881(c) of the Code and the
regulations thereunder; and
(b) no withholding of United States federal income tax will be
required with respect to any gain realized by a Non-United States Holder
upon the sale or other disposition of the Capital Securities (or Junior
Subordinated Debentures).
To satisfy the requirement referred to in (a)(iv) above, the Beneficial
Owner, or a financial institution holding the Capital Securities (or Junior
Subordinated Debentures) on behalf of such owner, must provide, in accordance
with specified procedures, to the Trust or its paying agent, a statement to the
effect that the Beneficial Owner is not a United States Holder. Pursuant to
current temporary Treasury regulations, these requirements will be met if (1)
the Beneficial Owner provides his name and address, and certifies, under
penalties of perjury, that it is not a United States person (which certification
may be made on an IRS Form W-8 (or successor form)) or (2) a financial
institution holding the Capital Securities (or Junior Subordinated Debentures)
on behalf of the Beneficial Owner certifies, under penalties of perjury, that
such statement has been received by it and furnishes a paying agent with a copy
thereof.
If a Non-United States Holder cannot satisfy the requirements of the
"portfolio interest" exception described in (a) above, payments of premium, if
any, and interest (including any OID) made to such Non-United States Holder with
respect to the Capital Securities (or on the Junior Subordinated Debentures)
will be subject to a 30% United States Federal withholding tax unless the
Beneficial Owner provides the Company or its paying agent (a "Paying Agent"), as
the case may be, with a properly executed (1) IRS Form 1001 (or successor form)
claiming an exemption from, or a reduction of, such withholding tax under the
benefit of a United States income tax treaty or (2) IRS Form 4224 (or successor
form) stating that interest paid with respect to the Capital Securities (or on
the Junior Subordinated Debentures) is not subject to withholding tax because it
is effectively connected with the Beneficial Owner's conduct of a trade or
business in the United States.
If a Non-United States Holder is engaged in a trade or business in the
United States and interest with respect to the Capital Securities (or on the
Junior Subordinated Debentures) is effectively connected with the conduct of
such trade or business, the Non-United States Holder, although exempt from the
withholding tax discussed above, will be subject to United States federal income
tax on such interest on a net income basis in the same manner as if it were a
United States person. In addition, if such Non-United States Holder is a foreign
corporation, it may be subject to a branch profits tax equal to 30% of its
effectively connected earnings and profits for the taxable year, subject to
adjustments. For this purpose, such interest would be included in such foreign
corporation's earnings and profits.
Any gain realized upon the sale or other taxable disposition of the Capital
Securities (or Junior Subordinated Debentures) generally will not be subject to
United States federal income tax unless (i) such
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gain is effectively connected with a trade or business carried on in the United
States by a Non-United States Holder, (ii) in the case of a Non-United States
Holder who is an individual, such individual is present in the United States for
183 days or more in the taxable year of such sale or disposition and certain
other conditions are met, and (iii) in the case of any gain representing accrued
interest with respect to the Capital Securities (or Junior Subordinated
Debentures), the requirements described above are not satisfied.
INFORMATION REPORTING AND BACKUP WITHHOLDING
Income on the Capital Securities (or Junior Subordinated Debentures) held
of record by United States Holders (other than corporations and other exempt
holders) will be reported annually to such holders and to the IRS. The Regular
Trustees currently intend to deliver such reports to holders of record prior to
January 31 following each calendar year. It is anticipated that persons who hold
Capital Securities (or Junior Subordinated Debentures) as nominees for
beneficial holders will report the required tax information to beneficial
holders on Form 1099.
"Backup withholding" at a rate of 31% will apply to payments of interest to
non-exempt United States persons unless the holder furnishes its taxpayer
identification number in the manner prescribed in applicable Treasury
regulations, certifies that such number is correct, certifies as to no loss of
exemption from backup withholding and meets certain other conditions.
No information reporting or backup withholding will be required with
respect to payments made by the Trust or any Paying Agent to Non-United States
Holders if a statement described in (a)(iv) under "Non-United States Holders"
has been received and the payor does not have actual knowledge that the
beneficial owner is a United States person.
In addition, backup withholding and information reporting will not apply if
payments of the principal, interest, OID or premium with respect to the Capital
Securities (or on the Junior Subordinated Debentures) are paid or collected by a
foreign office of a custodian, nominee or other foreign agent on behalf of the
Beneficial Owner, or if a foreign office of a broker (as defined in applicable
Treasury regulations) pays the proceeds of the sale of the Capital Securities
(or Junior Subordinated Debentures) to the owner thereof. If, however, such
nominee, custodian, agent or broker is, for United States federal income tax
purposes, a United States person, a controlled foreign corporation or a foreign
person that derives 50% or more of its gross income for certain periods from the
conduct of a trade or business in the United States, such payments will not be
subject to backup withholding but will be subject to information reporting,
unless (1) such custodian, nominee, agent or broker has documentary evidence in
its records that the Beneficial Owner is not a United States person and certain
other conditions are met or (2) the Beneficial Owner otherwise establishes an
exemption.
Payment of the proceeds from disposition of Capital Securities (or Junior
Subordinated Debentures) to or through a United States office of a broker is
subject to information reporting and backup withholding unless the holder or
beneficial owner establishes an exemption from information reporting and backup
withholding.
Any amounts withheld from a holder of the Capital Securities (or Junior
Subordinated Debentures) under the backup withholding rules will be allowed as a
refund or a credit against such holder's United States federal income tax
liability, provided the required information is furnished to the IRS.
BOOK-ENTRY ISSUANCE
The New Capital Securities initially will be represented by one or more
Capital Securities in registered, global form (the "Global Capital Securities").
The Global Capital Securities will be deposited upon issuance with the Property
Trustee as custodian for The Depository Trust Company ("DTC"), in New York, 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.
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DTC has advised the Trust and the Company 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 Initial Purchasers),
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 Company that, pursuant to procedures
established by it, (i) upon deposit of the Global Capital Securities, DTC will
credit the accounts of Participants with their respective portions of the
principal 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 interests in the Global Capital
Securities will not have Capital Securities registered in their name, will not
received physical delivery of Capital Securities in certificated form and will
not be considered the registered owners or holders thereof for any purpose.
Payments in respect of the Global Capital Security registered in the name
DTC or its nominee will be payable by the Property Trustee to DTC in its
capacity as the registered holder. 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
ownership 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 ownership 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 Company 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 the payment on the payment date
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 or the Trust. Neither the Trust 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 and
the Property Trustee may conclusively rely on and will be protected in relying
on instructions from DTC or its nominee for all purposes.
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. Transfers between
Participants in DTC will be effected in accordance with DTC's procedures, and
will be settled in same-day funds.
DTC has advised the Trust and the Company 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. However, if there is an Event of Default, 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.
Although DTC has agreed to the foregoing procedures to facilitate transfers
of interest in the Global Capital Securities among participants in DTC, it is
under no obligation to perform or to continue to perform such procedures, and
such procedures may be discontinued at any time. Neither the Trust nor the
Property
55
<PAGE> 57
Trustee will have any responsibility for the performance by DTC, or its
participants or indirect participants of their respective obligations under the
rules and procedures governing their operations.
A Global Capital Security is exchangeable for Capital Securities in
registered certificated for if (1) DTC (x) notifies the Trust that it is
unwilling or unable to continue as Depository for the Global Capital Security
and the Trust thereupon fails to appoint a successor Depositary or (y) has
ceased to be a clearing agency registered under the Exchange Act, (ii) the Trust
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 Declaration. 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
dominations, requested by or on behalf of the Depositary (in accordance with its
customary procedures).
The information in this section concerning DTC and its book-entry system
has been obtained from sources that the Trust and the Company believe to be
reliable, but neither the Trust nor the Company takes responsibility for the
accuracy thereof.
ERISA CONSIDERATIONS
Generally, employee benefit plans that are subject to the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), or Section 4975 of
the Code ("Plans"), may purchase Capital Securities, subject to the investing
fiduciary's determination that the investment in Capital Securities satisfies
ERISA's fiduciary standards and other requirements applicable to investments by
the Plan.
The Department of Labor ("DOL") has issued a regulation (29 C.F.R. Section
2510.3-101) (the "DOL Regulation") concerning the definition of what constitutes
the assets of a Plan. The DOL Regulation provides that as a general rule, the
underlying assets and properties of corporations, partnerships, trusts and
certain other entities in which a plan makes an "equity" investment will be
deemed for purposes of ERISA to be assets of the investing plan unless certain
exceptions apply.
There can be no assurance that any of the exceptions set forth in the DOL
Regulation will apply to the purchase of Capital Securities offered hereby and,
as a result, an investing Plan's assets could be considered to include an
undivided interest in the Junior Subordinated Debentures held by the Trust. In
the event that the assets of the Trust are considered assets of an investing
Plan, the Company, the Trustees and other persons, in providing services with
respect to the Junior Subordinated Debentures, may be considered fiduciaries to
such Plan and subject to the fiduciary responsibility provisions of Title I of
ERISA (including the prohibited transaction provisions thereof). In addition,
the prohibited transaction provisions of Section 4975 of the Code could apply
with respect to transactions engaged in by any "disqualified person," as defined
below, involving such assets unless a statutory or administrative exemption
applies.
Even if they are not fiduciaries, the Company and/or any of its affiliates
may be considered a "party in interest" (within the meaning of ERISA) or a
"disqualified person" (within the meaning of Section 4975 of the Code) with
respect to certain Plans. The acquisition and ownership of Capital Securities by
a Plan (including an individual retirement arrangement or other plan described
in Section 4975(e)(1) of the Code) 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. As a result, Plans with respect to which the Company or any of its
affiliates is a party in interest or a disqualified person should not acquire
Capital Securities unless such Capital Securities are acquired pursuant to and
in accordance with an applicable prohibited transaction exemption.
Notwithstanding the foregoing, it is possible that the New Capital
Securities may qualify as "publicly offered securities" under the DOL Regulation
if, in addition to the Exchange Offer, they are also "widely held" and "freely
transferable" at the time of the Exchange Offer. Under the DOL Regulation, a
class of securities is "widely held" only if it is a class of securities owned
by 100 or more investors independent of the issuer and each other. Although it
is possible that at the time of the Exchange Offer the New Capital Securities
will be "widely held", no assurances can be given that that will be true. If the
New Capital Securities are "publicly offered securities" at the time of the
Exchange Offer, the assets of the Trust would not
56
<PAGE> 58
be assets of any Plan purchasing such securities as of such time. If the New
Capital Securities did not qualify as "publicly offered securities", the
foregoing discussion about plan assets would also apply to the New Capital
Securities.
Any Plans or other entities whose assets include Plan assets subject to
ERISA or Section 4975 of the Code proposing to acquire Capital Securities or New
Capital Securities should consult with their own counsel.
PLAN OF DISTRIBUTION
Each broker-dealer that receives New Capital Securities for its own account
in connection with the Exchange Offer must acknowledge that it will deliver a
prospectus in connection with any resale of such New Capital Securities. This
Prospectus, as it may be amended or supplemented from time to time, may be used
by Participating Broker-Dealers during the period referred to below in
connection with resales of New Capital Securities received in exchange for Old
Capital Securities if such Old Capital Securities were acquired by such
Participating Broker-Dealers for their own accounts as a result of market-making
activities or other trading activities. The Company has agreed that this
Prospectus, as it may be amended or supplemented from time to time, may be used
by a Participating Broker-Dealer in connection with resales of such New Capital
Securities for a period ending 180 days after the Registration Statement of
which this Prospectus constitutes a part is declared effective. See "The
Exchange Offer -- Resales of New Capital Securities." The Company will not
receive any cash proceeds from the issuance of the New Capital Securities
offered hereby. New Capital Securities received by broker-dealers for their own
accounts in connection with the Exchange Offer may be sold from time to time in
one or more transactions in the over-the-counter market, in negotiated
transactions, through the writing of options on the New Capital Securities or a
combination of such methods of resale, at market prices prevailing at the time
of resale, at prices related to such prevailing market prices or at negotiated
prices. Any such resale may be made directly to purchasers or to or through
brokers or dealers who may receive compensation in the form of commissions or
concessions from any such broker-dealer and/or the purchasers of any such New
Capital Securities. Any broker-dealer that resells New Capital Securities that
were received by it for its own account in connection with the Exchange Offer
and any broker or dealer that participates in a distribution of such New Capital
Securities may be deemed to be an "underwriter" within the meaning of the
Securities Act, and any profit on any such resale of New Capital Securities and
any commissions or concessions received by any such persons may be deemed to be
underwriting compensation under the Securities Act. The Letter of Transmittal
states that by acknowledging that it will deliver and by delivering a
prospectus, a broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.
LEGAL MATTERS
Certain matters of Delaware law relating to the validity of the New Capital
Securities will be passed upon for the Company and the Trust by Richards, Layton
& Finger, special Delaware counsel to the Company and the Trust. The validity of
the New Junior Subordinated Debentures and the New Guarantee will be passed upon
for the Company and the Trust by Jennie P. Carlson, Senior Vice President,
General Counsel and Secretary for the Company, and by Simpson Thacher & Bartlett
(a partnership which includes professional corporations). Certain United States
federal income taxation matters also will be passed upon for the Company and the
Trust by Simpson Thacher & Bartlett.
INDEPENDENT AUDITORS
The consolidated financial statements of the Company and its affiliates as
of December 31, 1996 and for the year then ended incorporated by reference in
this Prospectus have been audited by Arthur Andersen LLP, independent public
accountants, as stated in their report appearing therein.
57
<PAGE> 59
======================================================
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS, AND IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE SECURITIES
DESCRIBED IN THIS PROSPECTUS OR AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER
TO BUY SUCH SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR SOLICITATION
IS UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER
SHALL, UNDER ANY CIRCUMSTANCE CREATE ANY IMPLICATION THAT THE INFORMATION
CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE OF SUCH
INFORMATION.
------------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
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<S> <C>
Available Information................. 6
Incorporation of Certain Documents by
Reference........................... 6
Prospectus Summary.................... 7
Risk Factors.......................... 15
Use of Proceeds....................... 19
Ratio of Earnings to Fixed Charges and
Ratio of Earnings to Combined Fixed
Charges and Preferred Stock
Dividends........................... 19
Accounting Treatment.................. 20
Regulatory Treatment.................. 20
Capitalization........................ 21
The Exchange Offer.................... 21
The Trust............................. 30
Description of Capital Securities..... 31
Description of Junior Subordinated
Debentures.......................... 40
Description of Guarantee.............. 48
Description of the Old Securities..... 50
Relationship Among the Capital
Securities, the Junior Subordinated
Debentures and the Guarantee........ 50
Certain United States Federal Income
Tax Consequences.................... 51
Book-Entry Issuance................... 56
ERISA Considerations.................. 57
Plan of Distribution.................. 58
Legal Matters......................... 59
Independent Auditors.................. 59
</TABLE>
======================================================
======================================================
STAR CAPITAL I
OFFER TO EXCHANGE ITS FLOATING RATE
CAPITAL SECURITIES
WHICH HAVE BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933
FOR ITS OUTSTANDING
FLOATING RATE CAPITAL SECURITIES
(LIQUIDATION AMOUNT $1,000 PER
CAPITAL SECURITY)
FULLY AND UNCONDITIONALLY GUARANTEED,
TO THE EXTENT DESCRIBED HEREIN, BY
STAR BANC CORPORATION
------------------------
PROSPECTUS
------------------------
, 1997
======================================================
<PAGE> 60
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Ohio Revised Code, Section 1701.13(E), allows indemnification by the
Company to any person made or threatened to be made a party to any proceedings,
other than a proceeding by or in the right of the Company, by reason of the fact
that he is or was a director, officer, employee or agent of the Company, against
expenses, including judgment and fines, if he acted in good faith and in a
manner reasonably believed to be in or not opposed to the best interests of the
Company and, with respect to criminal actions, in which he had no reasonable
cause to believe that his conduct was unlawful. Similar provisions apply to
actions brought by or in the right of the Company, except that no
indemnification shall be made in such cases when the person shall have been
adjudged to be liable for negligence or misconduct to the Company unless deemed
otherwise by the court. Indemnification is to be made by a majority vote of a
quorum of disinterested directors or the written opinion of independent counsel
or by the shareholders or by the court. The Company's Code of Regulations
extends such indemnification.
Under the Declaration, the Debenture Issuer agreed to indemnify each
Company Indemnified Person (as defined therein) who was or is a party or is
threatened to be made a party to 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 Debenture Issuer Indemnified Person against expenses
(including attorney fees), 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.
<TABLE>
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ITEM 21. EXHIBITS
4.1 Junior Subordinated Indenture, dated as of June 8, 1997, between the Company and The
First National Bank of Chicago, as Indenture Trustee
4.2 Restated Certificate of Trust of Star Capital I
4.3 Amended and Restated Declaration of Trust of Star Capital I, dated as of June 8, 1997
4.4 Form of Capital Security Certificate for Star Capital I (included in Exhibit 4.3)
4.5 Form of Junior Subordinated Debenture of the Company (included in Exhibit 4.1)
4.6 Guarantee Agreement, dated as of June 8, 1997, between the Company and The First
National Bank of Chicago, as Guarantee Trustee
4.7 Registration Rights Agreement, dated as of June 8, 1997, among Star Capital I, the
Company, Credit Suisse First Boston Corporation, Morgan Stanley & Co. Incorporated and
Salomon Brothers Inc
4.8 Form of Guarantee Agreement to be entered into by the Company and The First National
Bank of Chicago, as Guarantee Trustee, relating to the New Guarantee
4.9 Calculation Agency Agreement between Star Banc Corporation and The First National Bank
of Chicago, dated as of June 8, 1997
5.1 Opinion of Jennie P. Carlson, Senior Vice President, General Counsel and Secretary for
the Company relating to the legality of the Junior Subordinated Debentures and the
Guarantee to be issued by the Company
5.2 Opinion of Simpson Thacher & Bartlett, special counsel, relating to the legality of
the Junior Subordinated Debentures and the Guarantee to be issued by the Company
5.3 Opinion of Richards, Layton & Finger, special Delaware counsel, relating to the
legality of the Capital Securities to be issued by Star Capital I
8.1 Opinion of Simpson Thacher & Bartlett, special tax counsel, as to certain United
States federal income tax matters
</TABLE>
II-1
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<TABLE>
<C> <S>
12.1 Statement re: Computation of Ratio of Earnings to Combined Fixed Charges and Preferred
Dividends
23.1 Consent of Arthur Andersen LLP
23.2 Consent of Jennie P. Carlson (included in Exhibit 5.1 hereto)
23.3 Consent of Richards, Layton & Finger, special Delaware counsel (included in Exhibit
5.3 hereto)
23.4 Consent of Simpson Thacher & Bartlett (included in Exhibits 5.2 and 8.1 hereto)
24.1 Powers of Attorney (included on the signature page of this Registration Statement)
25.1 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of
The First National Bank of Chicago, as Trustee for the Junior Subordinated Indenture
25.2 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of
The First National Bank of Chicago, as Guarantee Trustee for the Guarantee for Star
Capital I
25.3 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of
The First National Bank of Chicago, as Property Trustee for the Amended and Restated
Declaration of Star Capital I
99.1 Form of Letter of Transmittal
99.2 Form of Notice of Guaranteed Delivery
99.3 Form of Exchange Agent Agreement
</TABLE>
ITEM 22. UNDERTAKINGS
Each of the undersigned Registrants, hereby undertakes that, for purposes
of determining any liability under the Securities Act of 1933, as amended, each
filing of a Registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing
of an employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in this
registration statement shall be deemed to be a new registration statement
relating to the securities offered herein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of each
Registrant pursuant to the provisions, 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 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 indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
The undersigned registrants hereby undertake to respond to requests for
information that is incorporated by reference into the Prospectus pursuant to
Item 4, 10(b), 11 or 13 of this form, within one business day of receipt of such
request, and to send the incorporated documents by first class mail or other
equally prompt means. This includes information contained in documents filed
subsequent to the effective date of the registration statement through the date
of responding to the request.
The undersigned registrants hereby undertake to supply by means of a
post-effective amendment all information concerning a transaction, and the
company being acquired or involved therein, that was not the subject of and
included in the registration statement when it became effective.
II-2
<PAGE> 62
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Star Banc
Corporation has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in Cincinnati, Ohio on
August 7, 1997.
Star Banc Corporation
By: /s/ DAVID M. MOFFETT
--------------------------------------
Name: David M. Moffett
Title: Executive Vice President and
Chief Financial Officer
Pursuant to the requirements of the Securities Act of 1933, Star Capital I
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Cincinnati, Ohio on August 7, 1997.
Star Capital I
By: /s/ JAMES D. HOGAN
------------------------------------
Title: Regular Trustee
By: /s/ BRUCE BARNES
------------------------------------
Title: Regular Trustee
By: /s/ JENNIE CARLSON
------------------------------------
Title: Regular Trustee
II-3
<PAGE> 63
POWER OF ATTORNEY
We, the undersigned directors and officers of Star Banc Corporation,
appoint Jerry A. Grundhofer, David M. Moffett and Jennie P. Carlson, or any of
them, our true and lawful attorneys and agents, to do any and all acts and
things in our names and on our behalf in our capacities as directors and
officers, which said attorneys and agents, or each of them, deem necessary or
advisable to enable the Corporation to comply with the Securities Act of 1933,
as amended, and any rules, regulations and requirements of the Securities and
Exchange Commission, in connection with a Registration Statement on Form S-4 to
be filed for the exchange of registered Floating Rate Capital Securities for
currently outstanding nonregistered Floating Rate Capital Securities including,
without limitation, power and authority to sign for us, or any of us, in our
names in the capacities indicated below, any and all amendments to such
Registration Statement, and we ratify and confirm all that said attorneys and
agents, or each of them, does or causes to be done by virtue of their power.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons as of the
7th day of August, 1997 in the capacities indicated:
<TABLE>
<S> <C>
/s/ JERRY A. GRUNDHOFER /s/ J.P. HAYDEN, JR.
- ------------------------------------------ ------------------------------------------
Jerry A. Grundhofer J.P. Hayden, Jr.
Chairman of the Board, President, Chief Director
Executive Officer and Director
/s/ DAVID M. MOFFETT /s/ ROGER L. HOWE
- ------------------------------------------ ------------------------------------------
David M. Moffett Roger L. Howe
Executive Vice President and Chief Director
Financial Officer
/s/ JAMES D. HOGAN /s/ THOMAS J. KLINEDINST, JR.
- ------------------------------------------ ------------------------------------------
James D. Hogan Thomas J. Klinedinst, Jr.
Controller Director
/s/ JAMES R. BRIDGELAND, JR. /s/ CHARLES S. MECHEM, JR.
- ------------------------------------------ ------------------------------------------
James R. Bridgeland, Jr. Charles S. Mechem, Jr.
Director Director
/s/ LAURENCE L. BROWNING, JR. /s/ DANIEL J. MEYER
- ------------------------------------------ ------------------------------------------
Laurence L. Browning, Jr. Daniel J. Meyer
Director Director
/s/ DAVID B. O'MALEY
- ------------------------------------------ ------------------------------------------
Victoria B. Buyniski David B. O'Maley
Director Director
/s/ SAMUEL M. CASSIDY /s/ O'DELL M. OWENS
- ------------------------------------------ ------------------------------------------
Samuel M. Cassidy O'dell M. Owens
Director Director
/s/ V. ANDERSON COOMBE
- ------------------------------------------ ------------------------------------------
V. Anderson Coombe Thomas E. Petry
Director Director
/s/ JOHN C. DANNEMILLER /s/ OLIVER W. WADDELL
- ------------------------------------------ ------------------------------------------
John C. Dannemiller Oliver W. Waddell
Director Director
</TABLE>
II-4
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EXHIBIT INDEX
<TABLE>
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<C> <S> <C>
4.1 Junior Subordinated Indenture, dated as of June 8, 1997, between the Company and
The First National Bank of Chicago, as Indenture Trustee
4.2 Restated Certificate of Trust of Star Capital I
4.3 Amended and Restated Declaration of Trust of Star Capital I, dated as of June 8,
1997
4.4 Form of Capital Security Certificate for Star Capital I (included in Exhibit
4.3)
4.5 Form of Junior Subordinated Debenture of the Company (included in Exhibit 4.1)
4.6 Guarantee Agreement, dated as of June 8, 1997, between the Company and The First
National Bank of Chicago, as Guarantee Trustee
4.7 Registration Rights Agreement, dated as of June 8, 1997, among Star Capital I,
the Company, Credit Suisse First Boston Corporation, Morgan Stanley & Co.
Incorporated and Salomon Brothers Inc
4.8 Form of Guarantee Agreement to be entered into by the Company and The First
National Bank of Chicago, as Guarantee Trustee, relating to the New Guarantee
4.9 Calculation Agency Agreement between Star Banc Corporation and The First
National Bank of Chicago, dated as of June 8, 1997
5.1 Opinion of Jennie P. Carlson, Senior Vice President, General Counsel and
Secretary for the Company relating to the legality of the Junior Subordinated
Debentures and the Guarantee to be issued by the Company
5.2 Opinion of Simpson Thacher & Bartlett, special counsel, relating to the legality
of the Junior Subordinated Debentures and the Guarantee to be issued by the
Company
5.3 Opinion of Richards, Layton & Finger, special Delaware counsel, relating to the
legality of the Capital Securities to be issued by Star Capital I
8.1 Opinion of Simpson Thacher & Bartlett, special tax counsel, as to certain United
States federal income tax matters
12.1 Statement re: Computation of Ratio of Earnings to Combined Fixed Charges and
Preferred Dividends
23.1 Consent of Arthur Andersen LLP
23.2 Consent of Jennie P. Carlson (included in Exhibit 5.1 hereto)
23.3 Consent of Richards, Layton & Finger, special Delaware counsel (included in
Exhibit 5.3 hereto)
23.4 Consent of Simpson Thacher & Bartlett (included in Exhibits 5.2 and 8.1 hereto)
24.1 Powers of Attorney (included on the signature page of this Registration
Statement)
25.1 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939
of The First National Bank of Chicago, as Trustee for the Junior Subordinated
Indenture
25.2 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939
of The First National Bank of Chicago, as Guarantee Trustee for the Guarantee
for Star Capital I
25.3 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939
of The First National Bank of Chicago, as Property Trustee for the Amended and
Restated Declaration of Star Capital I
99.1 Form of Letter of Transmittal
99.2 Form of Notice of Guaranteed Delivery
99.3 Form of Exchange Agent Agreement
</TABLE>
<PAGE> 1
EXHIBIT 4.1
STAR BANC CORPORATION
TO
THE FIRST NATIONAL BANK OF CHICAGO
a national banking association, Trustee
INDENTURE
Dated as of June 8, 1997
Floating Rate Junior Subordinated Debentures due 2027
<PAGE> 2
TABLE OF CONTENTS
Page
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ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION........ 1
SECTION 101. Definitions .................................................. 1
Act ................................................................. 2
Affiliate ........................................................... 2
Authenticating Agent ................................................ 2
Board of Directors .................................................. 2
Board Resolution .................................................... 3
Business Day ........................................................ 3
Capital Securities .................................................. 3
Cedel ............................................................... 3
Closing Date ........................................................ 3
Commission .......................................................... 3
Common Securities ................................................... 3
Company ............................................................. 3
Company Request ..................................................... 3
Company Order ....................................................... 3
Corporate Trust Office .............................................. 3
Covenant Defeasance ................................................. 3
Custodian ........................................................... 3
Declaration ......................................................... 4
Defaulted Interest .................................................. 4
Determination Date .................................................. 4
Depositary .......................................................... 4
DWAC ................................................................ 4
Event of Default .................................................... 4
Exchange Act ........................................................ 4
Extension Period .................................................... 4
Euroclear ........................................................... 4
Federal Reserve ..................................................... 4
Global Security ..................................................... 4
Guarantee ........................................................... 4
Holder .............................................................. 4
Indebtedness ........................................................ 4
Indenture ........................................................... 5
Initial Purchasers .................................................. 5
Institutional Accredited Investor ................................... 5
Interest Payment Date ............................................... 5
Investment Company Event ............................................ 5
Junior Subordinated Securities ...................................... 6
Legal Defeasance .................................................... 6
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Page
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LIBOR .............................................................. 6
London Business Day ................................................ 7
Maturity ........................................................... 7
New Junior Subordinated Securities ................................. 7
Officers' Certificate .............................................. 7
Opinion of Counsel ................................................. 7
Outstanding ........................................................ 7
Paying Agent ....................................................... 8
Person ............................................................. 8
Predecessor Security ............................................... 8
Private Placement Legend ........................................... 8
Property Trustee ................................................... 8
Qualified Institutional Buyer or "QIB" ............................. 8
Redemption Date .................................................... 8
Redemption Price ................................................... 8
Registration Rights Agreement ...................................... 8
Regular Record Date ................................................ 9
Regulation S ....................................................... 9
Regulation S Global Security ....................................... 9
Regulatory Capital Event ........................................... 9
Responsible Officer ................................................ 9
Restricted Global Security ......................................... 9
Restricted Period .................................................. 9
Restricted Security ................................................ 9
Rule 144A .......................................................... 10
Securities ......................................................... 10
Securities Act ..................................................... 10
Security Register .................................................. 10
Security Registrar ................................................. 10
Special Event ...................................................... 10
Special Record Date ................................................ 10
Stated Maturity .................................................... 10
Subsidiary ......................................................... 10
Tax Event .......................................................... 10
Trust .............................................................. 10
Trustee ............................................................ 11
Trust Indenture Act ................................................ 11
U.S. Government Obligations ........................................ 11
Vice President ..................................................... 11
SECTION 102. Compliance Certificates and Opinions ........................ 11
SECTION 103. Form of Documents Delivered to Trustee ...................... 11
SECTION 104. Acts of Holders; Record Dates ............................... 12
-ii-
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SECTION 105. Notices, Etc. to Trustee and the Company .................... 13
SECTION 106. Notice to Holders; Waiver ................................... 13
SECTION 107. Conflict With Trust Indenture Act ........................... 13
SECTION 108. Effect of Headings and Table of Contents .................... 14
SECTION 109. Separability Clause ......................................... 14
SECTION 110. Benefits of Indenture ....................................... 14
SECTION 111. GOVERNING LAW ............................................... 14
SECTION 112. Legal Holidays .............................................. 14
ARTICLE TWO
SECURITY FORMS ........................... 15
ARTICLE THREE
THE SECURITIES ........................... 16
SECTION 301. Title and Terms ............................................. 16
SECTION 302. Denominations ............................................... 17
SECTION 303. Execution, Authentication, Delivery and Dating .............. 17
SECTION 304. Temporary Securities ........................................ 18
SECTION 305. Registration; Registration of Transfer and Exchange ......... 18
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities ............ 19
SECTION 307. Payment of Interest; Interest Rights Preserved .............. 20
SECTION 308. Persons Deemed Owners ....................................... 21
SECTION 309. Cancellation ................................................ 22
SECTION 310. Computation of Interest ..................................... 22
SECTION 311. Right of Set-off ............................................ 22
SECTION 312. CUSIP Numbers ............................................... 22
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SECTION 313. Global Securities ................................................. 23
SECTION 314. Restrictive Legend ................................................ 25
SECTION 315. Special Transfer Provisions ....................................... 27
ARTICLE FOUR
SATISFACTION AND DISCHARGE; DEFEASANCE ..................... 30
SECTION 401. Satisfaction and Discharge of Indenture ........................... 30
SECTION 402. Legal Defeasance .................................................. 31
SECTION 403. Covenant Defeasance ............................................... 31
SECTION 404. Conditions to Legal Defeasance or Covenant Defeasance ............. 32
SECTION 405. Application of Trust Money ........................................ 33
SECTION 406. Indemnity for U.S. Government Obligations ......................... 33
ARTICLE FIVE
REMEDIES .................................... 33
SECTION 501. Events of Default ................................................. 33
SECTION 502. Acceleration of Maturity; Rescission and Annulment ................ 34
SECTION 503. Collection of Indebtedness and Suits for Enforcement by Trustee ... 35
SECTION 504. Trustee May File Proofs of Claim .................................. 36
SECTION 505. Trustee May Enforce Claims Without Possession of Securities ....... 36
SECTION 506. Application of Money Collected .................................... 36
SECTION 507. Limitation on Suits ............................................... 37
SECTION 508. Unconditional Right of Holders to Receive Principal and Interest;
Capital Security Holders' Rights .................................. 37
SECTION 509. Restoration of Rights and Remedies ................................ 38
SECTION 510. Rights and Remedies Cumulative .................................... 38
</TABLE>
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SECTION 511. Delay or Omission not Waiver ................................. 38
SECTION 512. Control by Holders ........................................... 39
SECTION 513. Waiver of Past Defaults ...................................... 39
SECTION 514. Undertaking for Costs ........................................ 39
SECTION 515. Waiver of Stay or Extension Laws ............................. 40
ARTICLE SIX
TRUSTEE ............................... 40
SECTION 601. Certain Duties and Responsibilities .......................... 40
SECTION 602. Notice of Defaults ........................................... 40
SECTION 603. Certain Rights of Trustee .................................... 41
SECTION 604. Not Responsible for Recitals or Issuance of Securities ....... 42
SECTION 605. Trustee and Other Agents may Hold Securities ................. 42
SECTION 606. Money Held in Trust .......................................... 42
SECTION 607. Compensation; Reimbursement; and Indemnity ................... 42
SECTION 608. Disqualification; Conflicting Interests ...................... 43
SECTION 609. Corporate Trustee Required; Eligibility ...................... 43
SECTION 610. Resignation and Removal; Appointment of Successor ............ 44
SECTION 611. Acceptance of Appointment by Successor ....................... 45
SECTION 612. Merger, Conversion, Consolidation or Succession to Business .. 45
SECTION 613. Preferential Collection of Claims Against Company ............ 46
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY .......... 46
SECTION 701. Company to Furnish Trustee Names and Addresses of Holders .... 46
SECTION 702. Preservation of Information; Communications to Holders ....... 46
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SECTION 703. Reports by Trustee ........................................... 46
SECTION 704. Reports by Company ........................................... 47
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE ......... 47
SECTION 801. Company May Consolidate, Etc., Only on Certain Terms ......... 47
SECTION 802. Successor Person Substituted ................................. 48
ARTICLE NINE
SUPPLEMENTAL INDENTURES ....................... 49
SECTION 901. Supplemental Indentures Without Consent of Holders ........... 49
SECTION 902. Supplemental Indentures With Consent of Holders .............. 49
SECTION 903. Execution of Supplemental Indentures ......................... 50
SECTION 904. Effect of Supplemental Indentures ............................ 50
SECTION 905. Conformity With Trust Indenture Act .......................... 50
SECTION 906. Reference in Securities to Supplemental Indentures ........... 51
ARTICLE TEN
COVENANTS .............................. 51
SECTION 1001. Payment of Principal and Interest ........................... 51
SECTION 1002. Maintenance of Office or Agency ............................. 51
SECTION 1003. Money for Security Payments to be Held in Trust ............. 51
SECTION 1004. Statements by Officers as to Default ........................ 52
SECTION 1005. Existence ................................................... 53
SECTION 1006. Maintenance of Properties ................................... 53
SECTION 1007. Payment of Taxes and Other Claims ........................... 53
SECTION 1008. Waiver of Certain Covenants ................................. 53
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SECTION 1009. Payment of the Trust's Costs and Expenses ....................... 54
SECTION 1010. Restrictions on Payments and Distributions ...................... 54
ARTICLE ELEVEN
SUBORDINATION OF SECURITIES ......................... 55
SECTION 1101. Securities Subordinate to Indebtedness .......................... 55
SECTION 1102. Default on Indebtedness ......................................... 55
SECTION 1103. Prior Payment of Indebtedness Upon Acceleration of Securities ... 56
SECTION 1104. Liquidation; Dissolution; Bankruptcy ............................ 56
SECTION 1105. Subrogation ..................................................... 58
SECTION 1106. Trustee to Effectuate Subordination ............................. 59
SECTION 1107. Notice by the Company ........................................... 59
SECTION 1108. Rights of the Trustee; Holders of Indebtedness .................. 60
SECTION 1109. Subordination May Not Be Impaired ............................... 60
ARTICLE TWELVE
REDEMPTION OF SECURITIES ........................... 61
SECTION 1201. Optional Redemption; Conditions to Optional Redemption .......... 61
SECTION 1202. Applicability of Article ........................................ 61
SECTION 1203. Election to Redeem; Notice to Trustee ........................... 61
SECTION 1204. Selection by Trustee of Securities to be Redeemed ............... 61
SECTION 1205. Notice of Redemption ............................................ 62
SECTION 1206. Deposit of Redemption Price ..................................... 62
SECTION 1207. Securities Payable on Redemption Date ........................... 63
</TABLE>
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Sections 310 through 318 of the
Trust Indenture Act of 1939:
<TABLE>
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Trust Indenture Indenture
Act Section Section
- ----------- -------
<S> <C>
Section 310(a)(1) ..................................................... 609
(a)(2) ......................................................... 609
(a)(3) ......................................................... Not Applicable
(a)(4) ......................................................... Not Applicable
(b) ............................................................ 608, 610
Section 311(a) ........................................................ 613
(b) ............................................................ 613
Section 312(a) ........................................................ 701
(b) ............................................................ 702(b)
(c) ............................................................ 702(c)
Section 313(a) ........................................................ 703(a)
(a)(4) ......................................................... 101, 1004
(b) ............................................................ 703(a)
(c) ............................................................ 703(a)
(d) ............................................................ 703(b)
Section 314(a) ........................................................ 704
(b) ............................................................ Not Applicable
(c)(1) ......................................................... 102
(c)(2) ......................................................... 102
(c)(3) ......................................................... Not Applicable
(d) ............................................................ Not Applicable
(e) ............................................................ 102
Section 315(a) ........................................................ 601
(b) ............................................................ 602
(c) ............................................................ 601
(d) ............................................................ 601
(e) ............................................................ 514
Section 316(a) ........................................................ 101
(a)(1)(A) ...................................................... 502
(a)(1)(B) ...................................................... 513
(a)(2) ......................................................... Not Applicable
(b) ............................................................ 508
(c) ............................................................ 104(c)
Section 317(a)(1) ..................................................... 503
(a)(2) ......................................................... 504
(b) ............................................................ 1003
</TABLE>
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Section 318(a) ........................................................ 107
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This INDENTURE is dated as of June 8, 1997, between STAR BANC CORPORATION,
a corporation duly organized and existing under the laws of the State of Ohio
(herein called the "Company"), having its principal office at 425 Walnut Street,
Cincinnati, Ohio 45202 and THE FIRST NATIONAL BANK OF CHICAGO, a national
banking association, as Trustee (herein called the "Trustee").
RECITALS
WHEREAS, for its lawful corporate purposes, the Company has duly
authorized the execution and delivery of this Indenture to provide for the
issuances of its Floating Rate Junior Subordinated Debentures due 2027 (the
"Junior Subordinated Securities") and its Floating Rate New Junior Subordinated
Debentures due 2027 (the "New Junior Subordinated Securities", and together with
the Junior Subordinated Securities, the "Securities") to be issued in exchange
for the Junior Subordinated Securities.
WHEREAS, Star Capital I (the "Trust") has offered to, and may
concurrently with any issuance by the Company of Junior Subordinated Debentures
after the date hereof offer to, the public its Floating Rate Capital Securities
(the "Capital Securities") representing undivided beneficial ownership interests
in the assets of the Trust and proposes to invest the proceeds from each such
offering and the proceeds from each issuance of its Common Securities in the
Securities.
WHEREAS, to provide the terms and conditions upon which the
Securities are to be authenticated, issued and delivered, the Company has duly
authorized the execution of this Indenture.
WHEREAS, all things necessary to make this Indenture a valid
agreement of the Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities, as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 101. Definitions.
For all purposes of this Indenture, except as expressly provided or
unless the context otherwise requires:
<PAGE> 12
2
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular and the
masculine as well as the feminine;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles;
(4) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision;
(5) a reference to any Person shall include its successor and
assigns;
(6) a reference to any agreement or instrument shall mean such
agreement or instrument as supplemented, modified, amended or amended and
restated and in effect from time to time;
(7) a reference to any statute, law, rule or regulation, shall
include any amendments thereto applicable to the relevant Person, and any
successor statute, law, rule or regulation; and
(8) a reference to any particular rating category shall be deemed to
include any corresponding successor category, or any corresponding rating
category issued by a successor or subsequent rating agency.
"Act", when used with respect to any Holder, has the meaning
specified in Section 104.
"Additional Interest" has the meaning specified in Section 307.
"Affiliate" of any specified Person means any other Person directly
or indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Authenticating Agent" means any Person authorized by the Trustee to
act on behalf of the Trustee to authenticate Securities.
"Board of Directors" means either the board of directors of the
Company or any duly authorized committee of that board as the context requires.
<PAGE> 13
3
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
the Board of Directors or the Executive Committee thereof and to be in full
force and effect on the date of such certification, and delivered to the
Trustee.
"Business Day" means any day other than a Saturday or Sunday or a
day on which banking institutions in New York City, Chicago, Illinois or
Cincinnati, Ohio are authorized or required by law or executive order to remain
closed or a day on which the Corporate Trust Office of the Trustee, or the
principal office of the Property Trustee, under the Declaration, is closed for
business.
"Calculation Agent" means any Person authorized by the Company to
determine the interest rate of the Securities.
"Capital Securities" has the meaning specified in the Recitals to
this instrument.
"Cedel" means Cedel, S.A.
"Closing Date" means June 8, 1997.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Securities Exchange Act of 1934, or,
if at any time after the execution of this instrument such Commission is not
existing and performing the duties now assigned to it under the Trust Indenture
Act, then the body performing such duties at such time.
"Common Securities" means the common securities issued by the Trust.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"Company Request" or "Company Order" means a written request or
order signed in the name of the Company by its Chairman of the Board, its Vice
Chairman of the Board, its President or a Vice President, and by its Treasurer,
an Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered
to the Trustee.
"Corporate Trust Office" means the principal office of the Trustee
in the Chicago, Illinois, at which at any particular time its corporate trust
business shall be administered and which at the date of this Indenture is
located at One First National Plaza, Suite 0126, Chicago, Illinois 60670-0126,
Attention: Corporate Trust.
"Covenant Defeasance" has the meaning specified in Section 403.
"Custodian" means the custodian for the time being of any Global
Security as designated by the Depositary.
<PAGE> 14
4
"Declaration" means the Amended and Restated Declaration of Trust,
dated as of June 8, 1997, as amended, modified or supplemented from time to
time, among the trustees of the Trust named therein, the Company, as sponsor,
and the holders from time to time of undivided beneficial ownership interests in
the assets of the Trust.
"Defaulted Interest" has the meaning specified in Section 307.
"Determination Date" means, with respect to any interest period, the
date that is two London Business Days prior to the first day of such interest
period.
"Depositary" means, with respect to Securities issuable in whole or
in part in the form of one or more Global Securities, a clearing agency
registered under the Exchange Act that is designated to act as Depositary for
such Securities.
"DWAC" means Deposit and Withdrawal At Custodian Service.
"Event of Default" has the meaning specified in Section 501.
"Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, and any successor legislation.
"Extension Period" has the meaning specified in Section 301.
"Euroclear" means Morgan Guaranty Trust Company of New York,
Brussels office, as operator of the Euroclear System.
"Federal Reserve" means the Board of Governors of the Federal
Reserve System.
"Global Security" means a Security that evidences all or part of the
Securities and is authenticated and delivered to, and registered in the name of,
the Depositary for such Securities or a nominee thereof.
"Guarantee" means the Guarantee Agreement, dated as of June 8, 1997,
made by the Company in favor of The First National Bank of Chicago as trustee
thereunder for the benefit of the Holders (as defined therein) of the Capital
Securities and the holder of the Common Securities.
"Holder" means a Person in whose name a Security is registered in
the Security Register.
"Indebtedness" means, whether recourse is to all or a portion of the
assets of the Company and whether or not contingent, (i) every obligation of the
Company for money borrowed, (ii) every obligation of the Company evidenced by
bonds, debentures, notes or other similar instruments of the Company, including
obligations incurred in connection with the acquisition of property, assets or
businesses, (iii) every reimbursement obligation of the
<PAGE> 15
5
Company with respect to letters of credit, bankers' acceptances or similar
facilities issued for the account of the Company, (iv) every obligation of the
Company issued or assumed as the deferred purchase price of property or services
(but excluding trade accounts payable or accrued liabilities arising in the
ordinary course of business), (v) every capital lease obligation of the Company,
(vi) every obligation of the Company for claims (as defined in Section 101(4) of
the United States Bankruptcy Code of 1978, as amended) in respect of derivative
products such as interest and foreign exchange rate contracts, commodity
contracts and similar arrangements and (vii) every obligation of the type
referred to in clauses (i) through (vi) of another Person and all dividends of
another Person the payment of which, in either case, the Company has guaranteed
or is responsible or liable for, directly or indirectly, as obligor or
otherwise; provided that "Indebtedness" shall not include (a) any obligations
which, by their terms, are expressly stated to rank pari passu in right of
payment with, or to not be superior in right of payment to, the Securities, (b)
any Indebtedness of the Company which when incurred and without respect to any
election under Section 1111(b) of the United States Bankruptcy Code of 1978, as
amended, was without recourse to the Company, (c) any Indebtedness of the
Company to any of its subsidiaries, (d) Indebtedness of the Company to any
employee or (e) any indebtedness in respect of debt securities issued to any
trust, or a trustee of such trust, partnership or other entity affiliated with
the Company that is a financing entity of the Company in connection with the
issuance of such financing entity of securities that are similar to the Capital
Securities.
"Indenture" means this instrument as originally executed or as it
may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively.
"Initial Purchasers" means Credit Suisse First Boston Corporation,
Morgan Stanley & Co. Incorporated and Salomon Brothers Inc.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as the term is defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act.
"Interest Payment Date", when used with respect to any installment
of interest on a Security, means the date specified in such Security as the
fixed date on which an installment of interest with respect to the Securities is
due and payable.
"Investment Company Event" means the receipt by the Trust of an
Opinion of Counsel having a recognized national securities practice to the
effect that, as a result of the occurrence of a change in law or regulation or a
change in interpretation or application of law or regulation by any legislative
body, court, governmental agency or regulatory authority (a "Change in 1940 Act
Law"), the Trust is or will be considered an "investment company" that is
required to be registered under the Investment Company Act of 1940 as amended,
which Change in 1940 Act Law becomes effective on or after the date of original
issuance of the Securities.
<PAGE> 16
6
"Junior Subordinated Securities" has the meaning specified in the
Recitals to this instrument.
"Legal Defeasance" has the meaning specified in Section 402.
"LIBOR" means, with respect to an interest period relating to an
Interest Payment Date (in the following order of priority):
(i) 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;
(ii) 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
.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;
(iii) 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. If at least
two quotations are provided, LIBOR will be the
arithmetic mean (if necessary rounded upwards to the
nearest whole multiple of .00001%) of such quotations;
(iv) if fewer than two such quotations are provided as
requested in clause (iii) 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 as of 11:00 a.m. (London time) on such
Determination Date. If at least two such quotations are
provided, LIBOR will be the arithmetic mean (if
necessary rounded upwards to the nearest whole multiple
of .00001%) of such quotations; and
(v) if fewer than two such quotations are provided as
requested in clause (iv) 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.
<PAGE> 17
7
(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, the corrected rate as so
substituted on the applicable page will be the applicable LIBOR for such
Determination Date.
"London Business Day" means any day, other than a Saturday or
Sunday, on which banks are open for business in London.
"Maturity", when used with respect to any Security, means the date
on which the principal of such Security becomes due and payable as therein or
herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption or otherwise.
"New Junior Subordinated Securities" has the meaning specified in
the Recitals to this instrument.
"Officers' Certificate" means a certificate signed on behalf of the
Company by the Chairman of the Board, a Vice Chairman of the Board, the
President or a Vice President, and by the Treasurer, an Assistant Treasurer, the
Secretary or an Assistant Secretary, of the Company, and delivered to the
Trustee. One of the officers signing an Officers' Certificate given pursuant to
Section 1004 shall be the principal executive, financial or accounting officer
of the Company. Any Officers' Certificate delivered with respect to compliance
with a condition or covenant provided for in this Indenture shall include:
(a) a statement that each officer signing the Officers' Certificate
on behalf of the Company 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
(c) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company (and who may be an employee of the Company), and who
shall be reasonably acceptable to the Trustee. An opinion of counsel may rely on
certificates as to matters of fact.
"Outstanding", when used with respect to Securities, means, as of
the date of determination, all Securities authenticated and delivered under this
Indenture, except: (i) Securities cancelled by the Trustee or delivered to the
Trustee for cancellation; (ii) Securities for whose payment or redemption money
in the necessary amount has been deposited with the Trustee or any Paying Agent
(other than the Company) in trust or set aside and segregated in trust by the
Company (if the Company shall act as its own Paying Agent) for the Holder of
such Securities; provided that, if such Securities are to be redeemed, notice of
such
<PAGE> 18
8
redemption has been duly given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made; and (iii) Securities which have been
paid pursuant to Section 306, or in exchange or for in lieu of which other
Securities have been authenticated and delivered pursuant to this Indenture,
other than any such Securities in respect of which there shall have been
presented to the Trustee proof satisfactory to it that such Securities are held
by a bona fide purchaser in whose hands such Securities are valid obligations of
the Company; provided, however, that in determining whether the holders of the
requisite principal amount of Outstanding Securities are present at a meeting of
holders of Securities for quorum purposes or have consented to or voted in favor
of any request, demand, authorization, direction, notice, consent, waiver,
amendment or modification hereunder, Securities held for the account of the
Company, any of its subsidiaries or any of its affiliates shall be disregarded
and deemed not to be Outstanding, except that in determining whether the Trustee
shall be protected in making such a determination or relying upon any such
quorum, consent or vote, only Securities which the Trustee actually knows to be
so owned shall be so disregarded.
"Paying Agent" means any Person authorized by the Company to pay the
principal of or interest on any Securities on behalf of the Company.
"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.
"Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same debt as that evidenced
by such particular Security; and, for the purposes of this definition, any
security authenticated and delivered under Section 306 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security.
"Private Placement Legend" has the meaning specified in Section 314
of this Indenture.
"Property Trustee" has the meaning set forth in the Declaration.
"Qualified Institutional Buyer" or "QIB" shall have the meaning
specified in Rule 144A under the Securities Act.
"Redemption Date", when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price", when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Registration Rights Agreement" means the Registration Rights
Agreement dated the date hereof between the Company and the Initial Purchasers
for the benefit of
<PAGE> 19
9
themselves and the Holders (as defined therein) of the Capital Securities issued
by the Trust as of the date hereof.
"Regular Record Date" for the interest payable on any Interest
Payment Date means the 1st day of the month in which the relevant Interest
Payment Date occurs.
"Regular Trustee" has the meaning specified in the Declaration.
"Regulation S" means Regulation S under the Securities Act and any
successor regulation thereto.
"Regulation S Global Security" means any Global Security or
Securities evidencing Securities that are to be traded pursuant to Regulation S.
"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 or administrative pronouncement or action or
judicial decision for 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 1 capital (or its then equivalent); provided, however, that the
distribution of the Securities in connection with the liquidation of the Trust
by the Company shall not in and of itself constitute a Regulatory Capital Event
unless such liquidation shall have occurred in connection with a Tax Event or an
Investment Company Event.
"Responsible Officer", when used with respect to the Trustee, means
the Chairman or any Vice-Chairman of the board of directors, the Chairman or any
Vice-Chairman of the executive committee of the board of directors, the Chairman
of the trust committee, the President, any Vice President, the Secretary, any
Assistant Secretary, the Treasurer, any Assistant Treasurer, any Trust Officer
or Assistant Trust Officer, the Controller or any Assistant Controller or any
other 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.
"Restricted Global Security" means any Global Security or Securities
evidencing Securities that are to be traded pursuant to Rule 144A.
"Restricted Period" shall have the meaning specified in Section 315.
"Restricted Security" has the meaning assigned to such term in
Rule 144(a)(3) of the Securities Act.
<PAGE> 20
10
"Rule 144A" means Rule 144A under the Securities Act.
"Securities" has the meaning specified in the Recitals to this
instrument.
"Securities Act" means the Securities Act of 1933, as amended.
"Security Register" and "Security Registrar" have the respective
meanings specified in Section 305.
"Special Event" means either an Investment Company Event, a
Regulatory Capital Event or a Tax Event.
"Special Record Date" for the payment of any Defaulted Interest
means a date fixed by the Trustee pursuant to Section 307.
"Stated Maturity", when used with respect to any Security or any
installment of interest thereon, means the date specified in such Security as
the date on which the principal, together with any accrued and unpaid interest,
of such Security or such installment of interest is due and payable.
"Subsidiary" means a corporation more than 50% of the outstanding
voting stock of which is owned, directly or indirectly, by the Company or by one
or more other Subsidiaries or by the Company and one or more other Subsidiaries.
For the purposes of this definition, "voting stock" means stock which ordinarily
has voting power for the election of directors, whether at all times or only so
long as no senior class of stock has such voting power by reason of any
contingency.
"Tax Event" means the receipt by the Trust of an Opinion of Counsel,
rendered by a law firm having a recognized national tax practice, to the effect
that, as a result of any amendment to, change in or announced proposed change in
the laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein, or as a result of any
official or administrative pronouncement or action or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
adopted or which proposed change, pronouncement or decision is announced on or
after the date of original issuance of the Capital Securities under the
Declaration, 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" means Star Capital I, a statutory business trust declared
and established pursuant to the Delaware Business Trust Act by the Declaration.
<PAGE> 21
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"Trustee" means the Person named as the "Trustee" in the first
paragraph of this Indenture until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in
force at the date as of which this instrument was executed; provided, however,
that in the event the Trust Indenture Act of 1939 is amended after such date,
"Trust Indenture Act" means, to the extent required by any such amendment, the
Trust Indenture Act of 1939 as so amended.
"U.S. Government Obligations" has the meaning specified in
Section 404.
"Vice President", when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president."
SECTION 102. Compliance Certificates and Opinions.
Upon any application or request by the Company to the Trustee to
take any action under any provision of this Indenture, the Company shall furnish
to the Trustee such certificates and opinions as may be required under the Trust
Indenture Act. Each such certificate or opinion shall be given in the form of an
Officers' Certificate, if to be given by an officer of the Company, or an
Opinion of Counsel, if to be given by counsel, and shall comply with the
requirements of the Trust Indenture Act and any other requirement set forth in
this Indenture.
SECTION 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by,
or covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or given an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or opinion of counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
<PAGE> 22
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Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
SECTION 104. Acts of Holders; Record Dates.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee at the address specified in Section 105 and, where it is hereby
expressly required, to the Company. Such instrument or instruments (and the
action embodied therein and evidenced thereby) are herein sometimes referred to
as the "Act" of the Holders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose of this Indenture and (subject to Section 601)
conclusive in favor of the Trustee and the Company, if made in the manner
provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustee deems sufficient.
(c) The Company may, in the circumstances permitted by the Trust
Indenture Act, fix any day as the record date for the purpose of determining the
Holders entitled to give or take any request, demand, authorization, direction,
notice, consent, waiver or other action, or to vote on any action, authorized or
permitted to be given or taken by Holders. If not set by the Company prior to
the first solicitation of a Holder made by any Person in respect of any such
action, or, in the case of any such vote, prior to such vote, the record date
for any such action or vote shall be the 15th day (or, if later, the date of the
most recent list of Holders required to be provided pursuant to Section 701)
prior to such first solicitation or vote, as the case may be.
With regard to any record date, only the Holders on such date (or
their duly designated proxies) shall be entitled to give or take, or vote on,
the relevant action.
(d) The ownership of Securities shall be proved by the Security
Register.
(e) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Security shall bind every future Holder
of the same Security
<PAGE> 23
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and the Holder of every Security issued upon the registration of transfer
thereof or in exchange therefor or in lieu thereof in respect of anything done,
omitted or suffered to be done by the Trustee or the Company in reliance
thereon, whether or not notation of such action is made upon such Security.
SECTION 105. Notices, Etc. to Trustee and the Company.
Any request, demand, authorization, direction, notice, consent,
waiver or Act of Holders or other document provided or permitted by this
Indenture to be made upon, given or furnished to, or filed with:
(1) the Trustee by any Holder or by the Company shall be sufficient
for every purpose hereunder if made, given, furnished or filed in writing to or
with the Trustee at its Corporate Trust Office, Attention: Corporate Trust
Division; or
(2) the Company by the Trustee or by any Holder shall be sufficient
for every purpose hereunder (unless otherwise herein expressly provided) if in
writing and mailed, first-class postage prepaid, to the Company addressed to it
at the address of its principal office specified in the first paragraph of this
instrument or at any other address previously furnished in writing to the
Trustee by the Company.
SECTION 106. Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event,
such notice shall be sufficiently given (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage prepaid, to each Holder
affected by such event, at his address as it appears in the Security Register,
not later than the latest date (if any), and not earlier than the earliest date
(if any), prescribed for the giving of such notice. In any case where notice to
Holders is given by mail, neither the failure to mail such notice, nor any
defect in any notice so mailed, to any particular Holder shall affect the
sufficiency of such notice with respect to other Holders. Where this Indenture
provides for notice in any manner, such notice may be waived in writing by the
Person entitled to receive such notice, either before or after the event, and
such waiver shall be the equivalent of such notice. Waivers of notice by Holders
shall be filed with the Trustee, but such filing shall not be a condition
precedent to the validity of any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made by telecopier or overnight air courier
guaranteeing next day delivery.
SECTION 107. Conflict With Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with a
provision of the Trust Indenture Act that is required under such Act to be a
part of and govern this Indenture, the provision of the Trust Indenture Act
shall control. If any provision of this Indenture modifies or excludes any
provision of the Trust Indenture Act that may be so modified or
<PAGE> 24
14
excluded, the latter provision shall be deemed to apply to this Indenture as to
modified or so be excluded, as the case may be.
SECTION 108. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents
are for convenience only and shall not affect the construction hereof.
SECTION 109. Separability Clause.
In case any provision in this Indenture or in the Securities shall
be invalid, illegal or unenforceable, the validity, legality and enforceability
of the remaining provisions shall not in any way be affected or impaired
thereby.
SECTION 110. Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder, the holders of Indebtedness, the holders of Capital Securities (to
the extent provided herein) and the Holders of Securities, any benefit or any
legal or equitable right, remedy or claim under this Indenture.
SECTION 111. GOVERNING LAW.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS
OF LAWS PRINCIPLES THEREOF. THIS INDENTURE IS SUBJECT TO THE PROVISIONS OF THE
TRUST INDENTURE ACT THAT ARE REQUIRED TO BE PART OF THIS INDENTURE AND SHALL, TO
THE EXTENT APPLICABLE, BE GOVERNED BY SUCH PROVISIONS.
SECTION 112. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date or
Stated Maturity of any Security shall not be a Business Day, then
(notwithstanding any other provision of this Indenture or of the Securities)
payment of interest or principal of the Securities need not be made on such
date, but may be made on the next succeeding Business Day (except that, if such
Business Day is in the next succeeding calendar year, such Interest Payment
Date, Redemption Date or Stated Maturity, as the case may be, shall be the
immediately preceding Business Day) with the same force and effect as if made on
the Interest Payment Date or Redemption Date, or at the Stated Maturity,
provided that no interest shall accrue for the period from and after such
Interest Payment Date, Redemption Date or Stated Maturity, as the case may be.
<PAGE> 25
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ARTICLE TWO
SECURITY FORMS
The Junior Subordinated Securities in definitive form and the New
Junior Subordinated Securities in definitive form shall be in the form attached
hereto as Exhibit A; provided, that the New Junior Subordinated Securities shall
not contain any of the provisions following the Trustee's authentication.
If the Securities are distributed to the holders of Capital
Securities and Common Securities, the record holder (including any Depositary)
of any Capital Securities or Common Securities shall be issued Securities in
definitive, fully registered form without interest coupons, substantially in the
form of Exhibit A hereto, with the legends in substantially the form of the
legends existing on the security representing the Capital Securities or Common
Securities to be exchanged (with such changes thereto as the officers executing
such Securities determine to be necessary or appropriate, as evidenced by their
execution of the Securities) and such other legends as may be applicable thereto
(including any legend required by Section 313 or Section 314 hereof), duly
executed by the Company and authenticated by the Trustee or the Authenticating
Agent as provided herein, which Securities, if to be held in global form by any
Depositary, may be deposited on behalf of the holders of the Securities
represented thereby with the Trustee, as custodian for the Depositary, and
registered in the name of a nominee of the Depositary.
Any Global Security shall represent such of the outstanding
Securities as shall be specified therein and shall provide that it shall
represent the aggregate amount of outstanding Securities from time to time
endorsed thereon and that the aggregate amount of outstanding Securities
represented thereby may from time to time be increased or reduced to reflect
transfers or exchanges permitted hereby. 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 or the Custodian, at
the direction of the Trustee, in such manner and upon instructions given by the
holder of such Securities in accordance with the Indenture. Payment of
principal, interest and premium, if any, on any Global Security shall be made to
the holder of such Global Security.
The Securities shall have such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by this
Indenture, and may have such letters, numbers or other marks of identification
and such legends or endorsements placed thereon as may be required to comply
with the rules of any securities exchange or as may, consistently herewith, be
determined by the officers executing such Securities, as evidenced by their
execution of the Securities.
The definitive Securities shall be printed, lithographed or engraved
or produced by any combination of these or other methods, all as determined by
the officers executing such Securities, as evidenced by their execution of such
Securities.
<PAGE> 26
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ARTICLE THREE
THE SECURITIES
SECTION 301. Title and Terms.
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited.
The Securities' Stated Maturity shall be June 15, 2027.
The Securities shall bear interest at a variable per annum rate
equal to LIBOR plus 0.765%, from June 8, 1997 or from the most recent Interest
Payment Date to which interest has been paid or duly provided for, as the case
may be, payable quarterly (subject to deferral as set forth herein), in arrears,
on the 15th day of June, September, December and March of each year, commencing
September 15, 1997, until the principal thereof is paid or made available for
payment. Interest will compound quarterly and will accrue at a variable per
annum rate equal to LIBOR plus 0.765%, to the extent permitted by applicable
law, on any interest installment in arrears for more than one quarterly period
or during an extension of an interest payment period as set forth below in this
Section 301. In the event that any date on which interest is payable on the
Securities is not a Business Day, then a payment of the interest payable on such
date will be made on the next succeeding day which is a Business Day (and
without any interest or other payment in respect of any such delay).
The Company shall have the right, at any time during the term of the
Securities, from time to time, to defer payment of interest on such Security for
up to 20 consecutive quarterly periods (an "Extension Period") provided that no
Extension Period may extend past the Stated Maturity of the Security. There may
be multiple Extension Periods of varying lengths during the term of the
Securities. At the end of each Extension Period, if any, the Company shall pay
all interest then accrued and unpaid, together with interest thereon, compounded
quarterly at the rate specified on the Security to the extent permitted by
applicable law. Prior to the termination of any such Extension Period, the
Company may further extend the interest payment period, provided that no
Extension Period may exceed 20 consecutive quarterly periods or extend beyond
the Stated Maturity of the Securities. Upon the termination of any such
Extension Period and the payment of all amounts then due on any Interest Payment
Date, the Company 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 Company shall give the Property Trustee and the
Regular Trustees written notice of its election of such Extension Period at
least one Business Day prior to the record date for the related interest
payment.
The principal of and interest on the Securities shall be payable at
the office or agency of the Paying Agent in the United States maintained for
such purpose and at any other office or agency maintained by the Company for
such purpose in such coin or currency of the United States of America as at the
time of payment is legal tender for payment of public and private debts;
provided, however, that at the option of the Company payment of interest may
<PAGE> 27
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be made (i) by check mailed to the address of the Person entitled thereto as
such address shall appear in the Security Register or (ii) by wire transfer in
immediately available funds at such place and to such account as may be
designated by the Person entitled thereto as specified in the Security Register.
The Securities shall be subordinated in right of payment to
Indebtedness as provided in Article Eleven.
The Securities shall be redeemable as provided in Article Twelve.
SECTION 302. Denominations.
The Securities shall be issuable only in registered form, without
coupons, and only in denominations of $1,000 and any integral multiple thereof.
SECTION 303. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by its
Chairman of the Board, its Vice Chairman of the Board, its President or one of
its Vice Presidents. The signature of any of these officers on the Securities
may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.
In the event that the Company elects to issue additional Junior
Subordinated Debentures hereunder on a subsequent Closing Date, the Company
shall deliver to the Trustee, in the manner provided under the following
paragraph, duly executed Securities and a Company Order, together with such
Officers' Certificates, Board Resolutions and Opinions of Counsel (in each case
in substantially the form delivered at the initial Closing Date), as are
required for the issuance of Securities under this Indenture.
At any time and from time to time after the execution and delivery
of this Indenture, the Company may deliver Securities executed by the Company to
the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Securities; and the Trustee in accordance
with such Company Order shall authenticate and make available for delivery such
Securities as in this Indenture provided and not otherwise.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or
be valid or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature, and such certificate upon any
Security shall be conclusive evidence, and the only evidence, that such Security
has been duly authenticated and delivered hereunder.
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SECTION 304. 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 which are printed, lithographed,
typewritten, mimeographed or otherwise produced, 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 Securities may determine, as
evidenced by their execution of such Securities.
If temporary Securities are issued, the Company will cause
definitive Securities to be prepared without unreasonable delay. After the
preparation of definitive Securities, the temporary Securities shall be
exchangeable for definitive Securities upon surrender of the temporary
Securities at any office or agency of the Company designated pursuant to Section
1002, 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 a like
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 305. Registration; Registration of Transfer and Exchange.
The Company shall cause to be kept at the Corporate Trust Office of
the Trustee, a register (the register maintained in such office and in any other
office or agency designated pursuant to Section 1002 being herein sometimes
collectively referred to as the "Security 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. The Trustee is hereby
appointed "Security Registrar" for the purpose of registering Securities and
transfers of Securities as herein provided.
Upon surrender for registration of transfer of any Security at an
office or agency of the Company designated pursuant to Section 1002 for such
purpose, the Company shall execute, and the Trustee shall authenticate and make
available for delivery, in the name of the designated transferee or transferees,
one or more new Securities of any authorized denominations and of a like
aggregate principal amount.
At the option of the Holder, Securities may be exchanged for other
Securities of any authorized denominations and of a like aggregate principal
amount, upon surrender of the Securities to be exchanged at such office or
agency. Whenever any Securities are so surrendered for exchange, the Company
shall execute, and the Trustee shall authenticate and make available for
delivery, the Securities which the Holder making the exchange is entitled to
receive.
All Securities issued upon any registration of transfer or exchange
of Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the
<PAGE> 29
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same benefits under this Indenture, as the Securities surrendered upon such
registration of transfer or exchange.
Every Security presented or surrendered for registration of transfer
or for exchange shall (if so required by the Company or the Trustee) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar duly executed, by the
Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Securities, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Securities, other than
exchanges pursuant to Sections 304, 906 or 1208 not involving any transfer.
If the Securities are to be redeemed in part, the Company shall not
be required (A) to issue, register the transfer of or exchange any Securities
during a period beginning at the opening of business 15 days before the day of
the mailing of a notice of redemption of any such Securities selected for
redemption under Section 1204 and ending at the close of business on the day of
such mailing, or (B) to register 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.
So long as the Securities are eligible for book-entry settlement
with the Depositary, or unless otherwise required by law, all Securities to be
traded on the PORTAL Market shall be represented by a Restricted Global Security
registered in the name of the Depositary or the nominee of the Depositary.
The transfer and exchange of beneficial interests in any Global
Security, which does not involve the issuance of a definitive Security or the
transfer of interests to another Global Security, shall be effected through the
Depositary (but not the Trustee or the Custodian) in accordance with this
Indenture (including the restrictions on transfer set forth herein) and the
procedures of the Depositary therefor. Neither the Trustee nor the Custodian (in
such respective capacities) will have any responsibility for the transfer and
exchange of beneficial interests in such Global Security that does not involve
the issuance of a definitive Security or the transfer of interests to another
Global Security.
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security is surrendered to the Trustee, the Company
shall execute and the Trustee shall authenticate and make available for delivery
in exchange therefor a new Security of like tenor and principal amount and
bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any Security
and (ii) such security or indemnity
<PAGE> 30
20
as may be required by them to save each of them and any agent of either of them
harmless, then, in the absence of notice to the Company or the Trustee that such
Security has been acquired by a bona fide purchaser, the Company shall execute
and the Trustee shall authenticate and make available for delivery, in lieu of
any such destroyed, lost or stolen Security, a new Security of like tenor and
principal amount and bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, the Company in its discretion may,
subject to the preceding paragraph, pay such Security instead of issuing a new
Security.
Upon the issuance of any new Security under this Section, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security issued pursuant to this Section in lieu of any
destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities.
SECTION 307. Payment of Interest; Interest Rights Preserved.
Interest on any Security which is payable, and is punctually paid or
duly provided for, on any Interest Payment Date shall be paid to the Person in
whose name that Security (or one or more Predecessor Securities) is registered
at the close of business on the Regular Record Date for such interest.
Any interest on any Security which 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 may be paid by the Company, at its election in each case, as
provided in clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted Interest
to the Persons in whose names the 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 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 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
<PAGE> 31
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paid in respect of such Defaulted Interest or shall make arrangements
satisfactory to the Trustee for such deposit prior to the date of the proposed
payment, such money when deposited to be held in trust for the benefit of the
Persons entitled to such Defaulted Interest as in this clause provided.
Thereupon the Trustee shall fix a Special Record Date for the payment of such
Defaulted Interest which shall be not more than 15 days and not less than 10
days prior to the date of the proposed payment and not less than 10 days after
the receipt by the Trustee of the notice of the proposed payment. The Trustee
shall promptly notify the 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 Holder at his 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 so mailed, such Defaulted Interest shall be paid to
the Persons in whose names the Securities (or their respective Predecessor
Securities) are registered at the close of business on such Special Record Date
and shall no longer be payable pursuant to the following clause (2).
(2) The Company may make payment of any Defaulted Interest in any
other lawful manner not inconsistent with the requirements of any securities
exchange on which the Securities may be listed, and if so listed, upon such
notice as may be required by such exchange, if, after notice given by the
Company to the Trustee of the proposed payment pursuant to this clause, such
manner of payment shall be deemed practicable by the Trustee. Subject to the
foregoing provisions of this Section, each Security delivered under this
Indenture upon registration of transfer of or in exchange for or in lieu of any
other Security shall carry the rights to interest accrued and unpaid, and to
accrue which, which were carried by such other Security.
In the event that a Registration Default (as defined in the
Registration Rights Agreement) occurs, additional interest ("Additional
Interest") shall become payable in respect of the Securities with respect to the
first 90-day period immediately following the occurrence of such Registration
Default, in an amount equal to $.25 per week per $1,000 principal amount of
Securities for each week or portion thereof that the Registration Default
continues. Additional Interest will increase by an additional $.05 per $1,000
principal amount of Securities with respect to each subsequent 90-day period
until all Registration Defaults have been cured, up to a maximum amount of
Additional Interest of $.50 per $1,000 principal amount of Securities.
SECTION 308. Persons Deemed Owners.
Prior to due presentment of a Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee shall treat
the Person in whose name such Security is registered as the owner of such
Security for the purpose of receiving payment of principal of and (subject to
Section 307) interest on such Security and for all other purposes whatsoever,
whether or not such Security be overdue, and neither the Company, the Trustee
nor any agent of the Company or the Trustee shall be affected by notice to the
contrary.
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SECTION 309. Cancellation.
All Securities surrendered for payment, redemption, registration of
transfer or exchange shall, if surrendered to any Person other than the Trustee,
be delivered to the Trustee and shall be promptly cancelled by it. The Company
may at any time deliver to the Trustee for cancellation any Securities
previously authenticated and delivered hereunder which the Company may have
acquired in any manner whatsoever, and all Securities so delivered shall be
promptly cancelled by the Trustee. No Securities shall be authenticated in lieu
of or in exchange for any Securities cancelled as provided in this Section,
except as expressly permitted by this Indenture. All cancelled Securities held
by the Trustee shall be disposed of as directed by a Company Order, provided,
however, that the Trustee may but shall not be required to destroy such
Securities.
SECTION 310. Computation of Interest.
The Company shall appoint a Calculation Agent, which may be the
Trustee, to determine LIBOR as of the Determination Date for each quarterly
interest period and to calculate the interest rate and the amount of interest
due for each such interest period. Absent manifest error, the Calculation
Agent's determination of LIBOR and its calculation of the interest rate for each
interest period shall be final and binding on the holders of the Securities.
Interest on the Securities shall be computed on the basis of the
actual number of days elapsed in a year of twelve 30-day months. The amount of
interest payable for any period shorter than a full quarterly period for which
interest is computed will be computed on the basis of actual number of days
elapsed in such 90-day quarterly period.
SECTION 311. Right of Set-off.
Notwithstanding anything to the contrary in the Indenture, the
Company shall have the right to set-off any payment it is otherwise required to
make thereunder to the extent the Company has theretofore made, or is
concurrently on the date of such payment making, a related payment under the
Guarantee.
SECTION 312. 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 Holders; 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 such numbers. The Company shall promptly notify
the Trustee of any change in the "CUSIP" numbers.
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SECTION 313. Global Securities.
If the Securities are distributed to the holders of Capital
Securities, such Securities distributed in respect of Capital Securities that
are held in global form by a Depositary will initially be issued as a Global
Security, unless such transfer cannot be effected through book-entry settlement.
If the Company shall establish that the Securities are to be issued in the form
of one or more Global Securities, then the Company shall execute and the Trustee
shall, in accordance with Section 303 and the Company Order, authenticate and
deliver one or more Global Securities that (i) shall represent and shall be
denominated in an amount equal to the aggregate principal amount of all of the
Securities to be issued in the form of Global Securities and not yet cancelled,
(ii) shall be registered in the name of the Depositary for such Global Security
or Securities or the nominee of such Depositary, and (iii) shall be delivered by
the Trustee to such Depositary or pursuant to such Depositary's instructions.
Global Securities shall bear a legend substantially to the following effect:
"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. Notwithstanding the provisions of Section 305,
unless and until it is exchanged in whole or in part for Securities in
definitive registered form, a Global Security representing all or a part of the
Securities may not be transferred in the manner provided in Section 305 except
as a whole by the Depositary to a nominee of such Depositary or by a nominee of
such Depositary to such Depositary or another nominee of such Depositary or by
such Depositary or any such nominee to a successor Depositary or a nominee of
such successor Depositary. Every Security delivered upon registration or
transfer of, or in exchange for, or in lieu of, this Global Security shall be a
Global Security subject to the foregoing, except in the limited circumstances
described above. Unless this certificate is presented by an authorized
representative of The Depository Trust Company, a New York corporation ("DTC"),
to the Company or its agent for registration of transfer, exchange or payment,
and any certificate issued is registered in the name of Cede & Co. or in such
other name as is requested by an authorized representative of DTC (and any
payment is to be 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 inasmuch as the
registered owner hereof, Cede & Co., has an interest herein."
Definitive Securities issued in exchange for all or a part of a
Global Security pursuant to this Section 313 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. Upon execution and authentication, the Trustee shall deliver such
definitive Securities to the persons in whose names such definitive Securities
are so registered.
At such time as all interests in Global Securities have been
redeemed, repurchased or canceled, such Global Securities shall be, upon receipt
thereof, canceled by the Trustee in accordance with standing procedures and
instructions existing between the Depositary and the Custodian. At any time
prior to such cancellation, if any interest in
<PAGE> 34
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Global Securities is exchanged for definitive Securities, redeemed, canceled or
transferred to a transferee who receives definitive Securities therefor or any
definitive Security is exchanged or transferred for part of Global Securities,
the principal amount of such Global Securities shall, in accordance with the
standing procedures and instructions existing between the Depositary and the
Custodian, be reduced or increased, as the case may be, and an endorsement shall
be made on such Global Securities by the Trustee or the Custodian, at the
direction of the Trustee, to reflect such reduction or increase.
The Company and the Trustee may for all purposes, including the
making of payments due on the Securities, deal with the Depositary as the
authorized representative of the Holders for the purposes of exercising the
rights of Holders hereunder. The rights of the owner of any beneficial interest
in a Global Security shall be limited to those established by law and agreements
between such owners and depository participants or Euroclear and Cedel;
provided, that no such agreement shall give any rights to any person against the
Company or the Trustee without the written consent of the parties so affected.
Multiple requests and directions from and votes of the Depositary as holder of
Securities in global form with respect to any particular matter shall not be
deemed inconsistent to the extent they do not represent an amount of Securities
in excess of those held in the name of the Depositary or its nominee.
If at any time the Depositary for any Securities represented by one
or more Global Securities notifies the Company that it is unwilling or unable to
continue as Depositary for such Securities or if at any time the Depositary for
such Securities shall no longer be eligible under this Section 313, the Company
shall appoint a successor Depositary with respect to such Securities. If a
successor Depositary for such Securities is not appointed by the Company within
90 days after the Company receives such notice or becomes aware of such
ineligibility, the Company's election that such Securities be represented by one
or more Global Securities shall no longer be effective and the Company shall
execute, and the Trustee, upon receipt of a Company Order for the authentication
and delivery of definitive Securities, will authenticate and make available for
delivery Securities in definitive registered form, in any authorized
denominations, in an aggregate principal amount equal to the principal amount of
the Global Security or Securities representing such Securities in exchange for
such Global Security or Securities.
The Company may at any time and in its sole discretion determine
that the Securities issued in the form of one or more Global Securities shall no
longer be represented by a Global Security or Securities. In such event the
Company shall execute, and the Trustee, upon receipt of a Company Order for the
authentication and delivery of definitive Securities, shall authenticate and
make available for delivery, Securities in definitive registered form, in any
authorized denominations, in an aggregate principal amount equal to the
principal amount of the Global Security or Securities representing such
Securities, in exchange for such Global Security or Securities.
Notwithstanding any other provisions of this Indenture (other than
the provisions set forth in Section 314(a)), Global Securities may not be
transferred as a whole except by the Depositary to a nominee of the Depositary
or by a nominee of the Depositary
<PAGE> 35
25
to the Depositary or another nominee of the Depositary or by the Depositary or
any such nominee to a successor Depositary or a nominee of such successor
Depositary.
Interests of beneficial owners in Global Security may be transferred
or exchanged for definitive Securities and definitive Securities may be
transferred or exchange for Global Securities in accordance with rules of the
Depositary and the provisions of Section 315.
Any Security in global form may be endorsed with or have
incorporated in the text thereof such legends or recitals or changes not
inconsistent with the provisions of this Indenture as may be required by the
Custodian, the Depositary or by the National Association of Securities Dealers,
Inc. in order for the Securities to be tradeable on the PORTAL Market or as may
be required for the Securities to be tradeable on any other market developed for
trading of securities pursuant to Rule 144A or required to comply with any
applicable law or any regulation thereunder or with Regulation S or with the
rules and regulations of any securities exchange upon which the Securities may
be listed or traded or to conform with any usage with respect thereto, or to
indicate any special limitations or restrictions to which any particular
Securities are subject.
SECTION 314. Restrictive Legend.
(a) Each Global Security and definitive Security that constitutes a
Restricted Security shall bear the following legend (the "Private Placement
Legend") on the face thereof until three years after the later of the date of
original issue and the last date on which the Company or any Affiliate of the
Company was the owner of such Capital Securities (or any predecessor thereto)
(the "Resale Restriction Termination Date"), unless otherwise agreed by the
Company and the Holder thereof:
"THIS SECURITY (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY
STATE SECURITIES LAWS AND NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER MAY BE
RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THIS
SECURITY, BY ITS ACCEPTANCE HEREOF, REPRESENTS, ACKNOWLEDGES AND AGREES
FOR THE BENEFIT OF THE COMPANY THAT: (I) IT HAS ACQUIRED A "RESTRICTED"
SECURITY WHICH HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT; (II) IT
WILL NOT OFFER, SELL OR OTHERWISE TRANSFER THIS SECURITY PRIOR TO THE
LATER OF THE DATE WHICH IS THREE YEARS AFTER THE DATE OF ORIGINAL ISSUANCE
HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE
COMPANY WAS THE OWNER OF SUCH RESTRICTED SECURITIES (OR ANY PREDECESSOR)
<PAGE> 36
26
EXCEPT (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH
HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS
THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON
WHO THE SELLER REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER"
(AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, (D) OUTSIDE THE UNITED STATES IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT,
(E) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF
SUBPARAGRAPH (A)(1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT
THAT IS ACQUIRING THE SECURITIES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF
SUCH AN INSTITUTIONAL "ACCREDITED INVESTOR," FOR INVESTMENT PURPOSES AND
NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO
ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND, IN EACH CASE, IN ACCORDANCE WITH THE APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY APPLICABLE
JURISDICTION; AND (III) IT WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED
TO, NOTIFY ANY PURCHASER FROM IT OF THIS SECURITY OF THE RESALE
RESTRICTIONS SET FORTH IN (II) ABOVE. ANY OFFER, SALE OR OTHER DISPOSITION
PURSUANT TO THE FOREGOING CLAUSES (II)(D), (E) AND (F) IS SUBJECT TO THE
RIGHT OF THE ISSUER OF THIS SECURITY AND THE TRUSTEE FOR SUCH SECURITIES
TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATIONS OR OTHER
INFORMATION ACCEPTABLE TO THEM IN FORM AND SUBSTANCE."
Any Security (or security issued in exchange or substitution
therefor) as to which such restrictions on transfer shall have expired in
accordance with their terms may, upon satisfaction of the requirements of
Section 314(b) and surrender of such Security for exchange to the Security
Registrar in accordance with the provisions of this Section 314, be exchanged
for a new Security or Securities, of like tenor and aggregate principal amount,
which shall not bear the restrictive legend required by this Section 314(a).
(b) Upon any sale or transfer of any Restricted Security (including
any interest in a Global Security) (i) that is effected pursuant to an effective
registration statement under the Securities Act or (ii) in connection with which
the Trustee receives certificates and other information (including an opinion of
counsel, if requested) reasonably acceptable to the Company and the Trustee to
the effect that such security will no longer be subject to the resale
restrictions under federal and state securities laws, then (A) in the case of a
Restricted Security in definitive form, the Security Registrar or co-Registrar
shall permit the holder thereof to exchange such Restricted Security for a
Security that does not bear the legend set forth in Section 314(a), and shall
rescind any such restrictions on transfer and (B) in the case of Restricted
Securities represented by a Global Security, such Security shall no longer be
subject to the restrictions contained in the legend set forth in Section 314(a)
(but still subject
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27
to the other provisions hereof). In addition, any Security (or Security issued
in exchange or substitution therefor) as to which the restrictions on transfer
described in the legend set forth in Section 314(a) have expired by their terms,
may, upon surrender thereof (in accordance with the terms of this Indenture)
together with such certifications and other information (including an Opinion of
Counsel having substantial experience in practice under the Securities Act and
otherwise reasonably acceptable to the Company, addressed to the Company and the
Trustee and in a form acceptable to the Company, to the effect that the transfer
of such Restricted Security has been made in compliance with Rule 144 or such
successor provision) acceptable to the Company and the Trustee as either of them
may reasonably require, be exchanged for a new Security or Securities of like
tenor and aggregate principal amount, which shall not bear the restrictive
legends set forth in Section 314(a).
SECTION 315. Special Transfer Provisions.
At any time at the request of the beneficial holder of an interest
in a Security in global form, such beneficial holder shall be entitled to obtain
a definitive Security upon written request to the Trustee in accordance with the
standing instructions and procedures existing between the Depositary and the
Trustee for the issuance thereof. Upon receipt of any such request, the Trustee
will cause the aggregate principal amount of the Security in global form to be
reduced and, following such reduction, the Company will execute and the Trustee
will authenticate and deliver to such beneficial holder (or its nominee) a
Security or Securities in the appropriate aggregate principal amount in the name
of such beneficial holder (or its nominee) and bearing such restrictive legends
as may be required by this Indenture.
Any transfer of a beneficial interest in a Security in global form
which cannot be effected through book-entry settlement must be effected by the
delivery to the transferee (or its nominee) of a definitive Security or
Securities registered in the name of the transferee (or its nominee) on the
books maintained by the Trustee. With respect to any such transfer, the Trustee
will cause, in accordance with the standing instructions and procedures existing
between the Depositary and the Trustee, the aggregate principal amount of the
Security in global form to be reduced and, following such reduction, the Company
will execute and the Trustee will authenticate and deliver to the transferee (or
such transferee's nominee, as the case may be), a Security or Securities in the
appropriate aggregate principal amount in the name of such transferee (or its
nominee) and bearing such restrictive legends as may be required by this
Indenture. In connection with any such transfer, the Trustee may request such
representations and agreements relating to the restrictions on transfer of such
Security or Securities from such transferee (or such transferee's nominee) as
the Trustee may reasonably require.
So long as the Securities are eligible for book-entry settlement, or
unless otherwise required by law, upon any transfer of a definitive Security to
a QIB in accordance with Rule 144A, unless otherwise requested by the
transferor, and upon receipt of the definitive Security or Securities being so
transferred, together with a certification from the transferor that the
transferor reasonably believes that the transferee is a QIB (or other evidence
satisfactory to the Trustee), the Trustee shall make an endorsement on the
Restricted Global Security to reflect an increase in the aggregate principal
amount of the Securities
<PAGE> 38
28
represented by the Restricted Global Security, the Trustee shall cancel such
definitive Security or Securities and cause, in accordance with the standing
instructions and procedures existing between the Depositary and the Trustee, the
aggregate principal amount of Securities represented by the Restricted Global
Security to be increased accordingly.
So long as the Securities are eligible for book-entry settlement, or
unless otherwise required by law, upon any transfer of a definitive Security in
accordance with Regulation S, if requested by the transferor, and upon receipt
of the definitive Security or Securities being so transferred, together with a
certification from the transferor that the transfer was made in accordance with
Rule 903 or 904 of Regulation S or Rule 144 under the Securities Act (or other
evidence satisfactory to the Trustee), the Trustee shall make or direct the
Custodian to make, an endorsement on the Regulation S Global Security to reflect
an increase in the aggregate principal amount of the Securities represented by
the Regulation S Global Security, the Trustee shall cancel such definitive
Security or Securities and cause, or direct the Custodian to cause, in
accordance with the standing instructions and procedures existing between the
Depositary and the Custodian, the aggregate principal amount of Securities
represented by the Regulation S Global Security to be increased accordingly.
If a holder of a beneficial interest in the Restricted Global
Security wishes at any time to exchange its interest in the Restricted Global
Security for an interest in the Regulation S Global Security, or to transfer its
interest in the Restricted Global Security to a person who wishes to take
delivery thereof in the form of an interest in the Regulation S Global Security,
such holder may, subject to the rules and procedures of the Depositary and to
the requirements set forth in the following sentence, exchange or cause the
exchange or transfer or cause the transfer of such interest for an equivalent
beneficial interest in the Regulation S Global Security. Upon receipt by the
Trustee, as transfer agent of (1) instructions given in accordance with the
Depositary's procedures from or on behalf of a holder of a beneficial interest
in the Restricted Global Security, directing the Trustee (via DWAC), as transfer
agent, to credit or cause to be credited a beneficial interest in the Regulation
S Global Security in an amount equal to the beneficial interest in the
Restricted Global Security to be exchanged or transferred, (2) a written order
given in accordance with the Depositary's procedures containing information
regarding the Euroclear or Cedel account to be credited with such increase and
the name of such account, and (3) a certificate given by the holder of such
beneficial interest stating that the exchange or transfer of such interest has
been made pursuant to and in accordance with Rule 903 or Rule 904 of Regulation
S or Rule 144 under the Securities Act (or other evidence satisfactory to the
Trustee), the Trustee, as transfer agent, shall promptly deliver appropriate
instructions to the Depositary (via DWAC), its nominee, or the custodian for the
Depositary, as the case may be, to reduce or reflect on its records a reduction
of the Restricted Global Security by the aggregate principal amount of the
beneficial interest in such Restricted Global Security to be so exchanged or
transferred from the relevant participant, and the Trustee, as transfer agent,
shall promptly deliver appropriate instructions (via DWAC) to the Depositary,
its nominee, or the custodian for the Depositary, as the case may be,
concurrently with such reduction, to increase or reflect on its records an
increase of the principal amount of such Regulation S Global Security by the
aggregate principal amount of the beneficial interest in such Restricted Global
Security to be so exchanged or transferred, and to credit or cause to be
credited to the account of the person
<PAGE> 39
29
specified in such instructions (who may be Morgan Guaranty Trust Company of New
York, Brussels office, as operator of Euroclear or Cedel or another agent member
of Euroclear or Cedel, or both, as the case may be, acting for and on behalf of
them) a beneficial interest in such Regulation S Global Security equal to the
reduction in the principal amount of such Restricted Global Security.
If a holder of a beneficial interest in the Regulation S Global
Security wishes at any time to exchange its interest in the Regulation S Global
Security for an interest in the Restricted Global Security, or to transfer its
interest in the Regulation S Global Security to a person who wishes to take
delivery thereof in the form of an interest in the Restricted Global Security,
such holder may, subject to the rules and procedures of Euroclear or Cedel and
the Depositary, as the case may be, and to the requirements set forth in the
following sentence, exchange or cause the exchange or transfer or cause the
transfer of such interest for an equivalent beneficial interest in such
Restricted Global Security. Upon receipt by the Trustee, as transfer agent of
(l) instructions given in accordance with the procedures of Euroclear or Cedel
and the Depositary, as the case may be, from or on behalf of a beneficial owner
of an interest in the Regulation S Global Security directing the Trustee, as
transfer agent, to credit or cause to be credited a beneficial interest in the
Restricted Global Security in an amount equal to the beneficial interest in the
Regulation S Global Security to be exchanged or transferred, (2) a written order
given in accordance with the procedures of Euroclear or Cedel and the
Depositary, as the case may be, containing information regarding the account
with the Depositary to be credited with such increase and the name of such
account, and (3) prior to the expiration of the related Restricted Period, a
certificate given by the holder of such beneficial interest and stating that the
person transferring such interest in such Regulation S Global Security
reasonably believes that the person acquiring such interest in the Restricted
Global Security is a QIB and is obtaining such beneficial interest in a
transaction meeting the requirements of Rule 144A and any applicable securities
laws of any state of the United States or any other jurisdiction (or other
evidence satisfactory to the Trustee), the Trustee, as transfer agent, shall
promptly deliver (via DWAC) appropriate instructions to the Depositary, its
nominee, or the custodian for the Depositary, as the case may be, to reduce or
reflect on its records a reduction of the Regulation S Global Security by the
aggregate principal amount of the beneficial interest in such Regulation S
Global Security to be exchanged or transferred, and the Trustee, as transfer
agent, shall promptly deliver (via DWAC) appropriate instructions to the
Depositary, its nominee, or the custodian for the Depositary, as the case may
be, concurrently with such reduction, to increase or reflect on its records an
increase of the principal amount of the Restricted Global Security by the
aggregate principal amount of the beneficial interest in the Regulation S Global
Security to be so exchanged or transferred, and to credit or cause to be
credited to the account of the person specified in such instructions a
beneficial interest in the Restricted Global Security equal to the reduction in
the principal amount of the Regulation S Global Security. After the expiration
of the related Restricted Period, the certification requirement set forth in
clause (3) of the second sentence of the above paragraph will no longer apply to
such exchanges and transfers.
If a holder of a definitive Security wishes at any time to exchange
its Security for a beneficial interest in any Global Security (or vice versa),
or to transfer its definitive Security to a person who wishes to take delivery
thereof in the form of a beneficial interest in
<PAGE> 40
30
a Global Security (or vice versa), such Securities and beneficial interests may
be exchanged or transferred for one another only in accordance with such
procedures as are substantially consistent with the provisions of the two
preceding paragraphs (including the certification requirements intended to
ensure that such exchanges or transfers comply with Rule 144, Rule 144A or
Regulation S, as the case may be) and as may be from time to time adopted by the
Company and the Trustee.
Any beneficial interest in one of the Global Securities that is
transferred to a person who takes delivery in the form of an interest in the
other Global Security will, upon transfer, cease to be an interest in such
Global Security and become an interest in the other Global Security and,
accordingly, will thereafter be subject to all transfer restrictions and other
procedures applicable to beneficial interests in such other Global Security for
as long as it remains such an interest.
For each Closing Date, prior to or on the 40th day after the later
of the commencement of the offering of the Capital Securities issued in
connection with such Closing Date and such Closing Date (each such period a
"Restricted Period"), beneficial interests in a Regulation S Global Security
issued in connection with such Closing Date may only be held through Morgan
Guaranty Trust Company of New York, Brussels Office, as operator of Euroclear or
Cedel or another agent member of Euroclear and Cedel acting for and on behalf of
them, unless delivery is made through a Restricted Global Security in accordance
with the certification requirements hereof. During a Restricted Period,
interests in the Regulation S Global Security, if any, issued in connection with
the Closing Date related to such Restricted Period, may be exchanged for
interests in a Restricted Global Security or for definitive Securities only in
accordance with the certification requirements described above.
ARTICLE FOUR
SATISFACTION AND DISCHARGE; DEFEASANCE
SECTION 401. Satisfaction and Discharge of Indenture.
This Indenture shall cease to be of further effect (except as to any
surviving rights of registration of transfer or exchange of Securities herein
expressly provided for), and the Trustee, on written demand of and at the
expense of the Company, shall execute instruments supplied by the Company
acknowledging satisfaction and discharge of this Indenture, when (1) either (A)
all Securities theretofore authenticated and delivered (other than (i)
Securities which have been destroyed, lost or stolen and which have been
replaced or paid as provided in Section 306 and (ii) Securities for whose
payment money has theretofore been deposited in trust or segregated and held in
trust by the Company and thereafter repaid to the Company or discharged from
such trust, as provided in Section 1003) have been delivered to the Trustee for
cancellation; or (B) all such Securities not theretofore delivered to the
Trustee for cancellation (i) have become due and payable, or (ii) will become
due and payable at their Maturity within one year, or (iii) if redeemable at the
option of the Company,
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are to be called for redemption within one year under arrangements satisfactory
to the Trustee for the giving of notice of redemption by the Trustee in the
name, and at the expense, of the Company and the Company, in the case of (i),
(ii) or (iii) above, has deposited or caused to be deposited with the Trustee as
funds in trust for the purpose an amount sufficient to pay and discharge the
entire indebtedness on such Securities not theretofore delivered to the Trustee
for cancellation, for principal and interest to the date of such deposit (in the
case of Securities which have become due and payable) or to the Maturity or
Redemption Date, as the case may be; (2) the Company has paid or caused to be
paid all other sums payable hereunder by the Company; and (3) the Company has
delivered to the Trustee an Officers' Certificate and an Opinion of Counsel,
each stating that all conditions precedent herein provided for relating to the
satisfaction and discharge of this Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 607 and, if money shall
have been deposited with the Trustee pursuant to subclause (B) of clause (1) of
this Section, the obligations of the Trustee under Section 402 and the last
paragraph of Section 1003 shall survive.
SECTION 402. Legal Defeasance.
In addition to discharge of this Indenture pursuant to Section 401,
in the case of any Securities with respect to which the exact amount described
in subparagraph (a) of Section 404 can be determined at the time of making the
deposit referred to in such subparagraph (a), the Company shall be deemed to
have paid and discharged the entire indebtedness on all the Securities as
provided in this Section on and after the date the conditions set forth in
Section 404 are satisfied, and the provisions of this Indenture with respect to
the Securities shall no longer be in effect (except as to (i) rights of
registration of transfer and exchange of Securities, (ii) substitution of
mutilated, defaced, destroyed, lost or stolen Securities, (iii) maintenance of a
Paying Agent, (iv) rights of Holders of Securities to receive, solely from the
trust fund described in subparagraph (a) of Section 404, payments of principal
thereof and interest, if any, thereon upon the original stated due dates
therefor (but not upon acceleration), (v) the rights, obligations, duties and
immunities of the Trustee hereunder, (vi) this Section 402 and (vii) the rights
of the Holders of Securities as beneficiaries hereof with respect to the
property so deposited with the Trustee payable to all or any of them)
(hereinafter called "Legal Defeasance"), and the Trustee, at the cost and
expense of the Company, shall execute proper instruments acknowledging the same.
SECTION 403. Covenant Defeasance.
In the case of any Securities with respect to which the exact amount
described in subparagraph (a) of Section 404 can be determined at the time of
making the deposit referred to in such subparagraph (a), (x) the Company shall
be released from its obligations under any covenants specified in or pursuant to
this Indenture (except as to (i) rights of registration of transfer and exchange
of Securities, (ii) substitution of mutilated, defaced, destroyed, lost or
stolen Securities, (iii) maintenance of a Paying Agent, (iv) rights of Holders
of Securities to receive, from the Company pursuant to Section 1001, payments of
principal thereof and interest, if any, thereon upon the original stated due
dates therefor (but not upon acceleration), (v) the rights, obligations, duties
and immunities of the Trustee hereunder and
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(vi) the rights of the Holders of Securities as beneficiaries hereof with
respect to the property so deposited with the Trustee payable to all or any of
them), and (y) the occurrence of any event specified in Section 501(3) (with
respect to any of the covenants specified in or pursuant to this Indenture)
shall be deemed not to be or result in an Event of Default, in each case with
respect to the Outstanding Securities as provided in this Section on and after
the date the conditions set forth in Section 404 are satisfied (hereinafter
called "Covenant Defeasance"), and the Trustee, at the cost and expense of the
Company, shall execute proper instruments acknowledging the same. For this
purpose, such Covenant Defeasance means that the Company may omit to comply with
and shall have no liability in respect of any term, condition or limitation set
forth in any such covenant (to the extent so specified in the case of Section
501(3)), whether directly or indirectly by reason of any reference elsewhere
herein to any such covenant or by reason of any reference in any such covenant
to any other provision herein or in any other document, but the remainder of
this Indenture and the Securities shall be unaffected thereby.
SECTION 404. Conditions to Legal Defeasance or Covenant Defeasance.
The following shall be the conditions to application of either
Section 402 or 403 to the Outstanding Securities:
(a) with reference to Section 402 or 403, the Company has
irrevocably deposited or caused to be irrevocably deposited with the Trustee as
funds in trust, specifically pledged as security for, and dedicated solely to,
the benefit of the Holders of Securities (i) cash, (ii) direct obligations of
the United States of America, backed by its full faith and credit ("U.S.
Government Obligations"), (iii) obligations of a Person controlled or supervised
by and acting as an agency or instrumentality of the United States of America
the timely payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, or (iv) a combination
thereof, in each case sufficient, in the opinion of a nationally recognized firm
of independent public accountants expressed in a written certification thereof
delivered to the Trustee, to pay and discharge the principal of and interest, if
any, on all Securities on each date that such principal or interest, if any, is
due and payable;
(b) in the case of Legal Defeasance under Section 402, the Company
has delivered to the Trustee an Opinion of Counsel based on the fact that (x)
the Company has received from, or there has been published by, the Internal
Revenue Service a ruling or (y), since the date hereof, there has been a change
in the applicable United States federal income tax law, in either case to the
effect that, and such opinion shall confirm that, the Holders of the Securities
of such series will not recognize income, gain or loss for federal income tax
purposes as a result of such deposit and Legal Defeasance and will be subject to
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 deposit and Legal Defeasance had not
occurred;
(c) in the case of Covenant Defeasance under Section 403, the
Company has delivered to the Trustee an Opinion of Counsel to the effect that,
and such opinion shall confirm that, the Holders of the Securities will not
recognize income, gain or loss for federal
<PAGE> 43
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income tax purposes as a result of such deposit and Covenant Defeasance and will
be subject to federal income tax on the same amount in the same manner and at
the same times as would have been the case if such deposit and Covenant
Defeasance had not occurred;
(d) such Legal Defeasance or Covenant Defeasance will not result in
a breach or violation of, or constitute a default under, any agreement or
instrument to which the Company is a party or by which it is bound; and
(e) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent contemplated by this provision have been complied with.
SECTION 405. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 1003, all
money and U.S. Government Obligations deposited with the Trustee pursuant to
Section 401 shall be held in trust and such money and all money from such U.S.
Government Obligations shall be applied by it, in accordance with the provisions
of the Securities and this Indenture, to the payment, either directly or through
any Paying Agent (including the Company acting as its own Paying Agent) as the
Trustee may determine, to the Persons entitled thereto, of the principal and
interest for whose payment such money and U.S. Government Obligations has been
deposited with the Trustee.
SECTION 406. Indemnity for U.S. Government Obligations.
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 404 or the principal or interest received in
respect of such obligations other than any such tax, fee or other charge that by
law is for the account of the Holders of Outstanding Securities.
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default.
"Event of Default" wherever used herein, means any one of the
following events that has occurred and is continuing (whatever the reason for
such Event of Default and whether it shall be occasioned by the provisions of
Article Eleven or be voluntary or involuntary or be effected by operation of law
or pursuant to any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):
(1) failure for 30 days to pay any interest on the Securities when
due (subject to the deferral of any due date in the case of an Extension
Period); or
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(2) failure to pay any principal on the Securities when due, whether
at Stated Maturity, upon redemption, by declaration of acceleration or
otherwise; or
(3) failure to observe or perform in any material respect any other
covenant herein that continues for 90 days after written notice to the Company
from the Trustee or the holders of at least 25% in aggregate principal amount of
the Outstanding Securities; or
(4) entry by a court having jurisdiction in the premises of (A) a
decree or order for relief in respect of the Company in an involuntary case or
proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or (B) a decree or order adjudging the
Company a bankrupt or insolvent, or approving as properly filed a petition
seeking reorganization, arrangement, adjustment or composition of or in respect
of the Company under any applicable Federal or State law, or appointing a
custodian, receiver, liquidator, assignee, trustee, sequestrator or other
similar official of the Company or of substantially all of the property of the
Company, or ordering the winding up or liquidation of its affairs, and the
continuance of any such decree or order for relief or any such other decree or
order unstayed and in effect for a period of 90 consecutive days; or
(5) (A) the commencement by the Company of a voluntary case or
proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or of any other case or proceeding to be
adjudicated a bankrupt or insolvent, or (B) the consent by the Company to the
entry of a decree or order for relief in respect of itself in an involuntary
case or proceeding under any applicable Federal or State bankruptcy, insolvency,
reorganization or other similar law or to the commencement of any bankruptcy or
insolvency case or proceeding against the Company, or (C) the filing by the
Company of a petition or answer or consent seeking reorganization or relief
under any applicable Federal or State bankruptcy, insolvency, reorganization, or
other similar law, or (D) the consent by the Company to the filing of such
petition or to the appointment of or taking possession by a custodian, receiver,
liquidator, assignee, trustee, sequestrator or other similar official of the
Company or of all or substantially all of the property of the Company, or (E)
the making by the Company of an assignment for the benefit of creditors.
SECTION 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default occurs and is continuing, then and in every
such case the Trustee or the Holders of not less than 25% in aggregate principal
amount of the Outstanding Securities shall have the right to declare the
principal of and the interest on all the Securities and any other amounts
payable hereunder to be due and payable immediately, provided, however, that if
upon an Event of Default, the Trustee or the Holders of at least 25% in
aggregate principal amount of the Outstanding Securities fail to declare the
payment of all amounts on the Securities to be immediately due and payable, the
holders of at least 25% in aggregate liquidation amount of Capital Securities
then outstanding shall have such right, by a notice in writing to the Company
(and to the Trustee if given by Holders or the holders of Capital Securities)
and upon any such declaration such principal and all accrued interest shall
become immediately due and payable.
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At any time after such a declaration of acceleration has been made
and before a judgment or decree for payment of the money due has been obtained
by the Trustee as hereinafter provided in this Article, the Holders of a
majority in aggregate principal amount of the Outstanding Securities, by written
notice to the Company and the Trustee, may rescind and annul such declaration
and its consequences if (1) the Company has paid or deposited with the Trustee a
sum sufficient to pay (A) all overdue interest on all Securities, (B) the
principal of (and premium, if any, on) any Securities which have become due
otherwise than by such declaration of acceleration and interest thereon at the
rate borne by the Securities, (C) to the extent that payment of such interest is
lawful, interest upon overdue interest at the rate borne by the Securities, and
(D) all sums paid or advanced by the Trustee hereunder and the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel; and (2) all Events of Default, other than the non-payment of the
principal of Securities which have become due solely by such declaration of
acceleration, have been cured or waived as provided in Section 513. Should the
Holders of such Securities fail to annul such declaration and waive such
default, the holders of a majority in aggregate liquidation amount of the
Capital Securities then outstanding shall have such right. No such rescission
shall affect any subsequent default or impair any right consequent thereon.
SECTION 503. Collection of Indebtedness and Suits for Enforcement by Trustee
The Company covenants that if
(1) default is made in the payment of any interest on any Security
when such interest becomes due and payable and such default continues for a
period of 30 days, or
(2) default is made in the payment of the principal of any Security
at the Maturity thereof,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole amount then due and payable on such
Securities for principal and interest, and, to the extent that payment thereof
shall be legally enforceable, interest on any overdue principal and on any
overdue 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 the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.
If an Event of Default occurs and is continuing, the Trustee may in
its discretion proceed to protect and enforce its rights and the rights of the
Holders by such appropriate judicial proceedings as the Trustee shall deem most
effectual to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy.
<PAGE> 46
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SECTION 504. Trustee May File Proofs of Claim.
In case of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other similar judicial
proceeding relative to the Company (or any other obligor upon the Securities),
its property or its creditors, the Trustee shall be entitled and empowered, by
intervention in such proceeding or otherwise, to take any and all actions
authorized under the Trust Indenture Act in order to have claims of the Holders
and the Trustee allowed in any such proceeding. In particular, the Trustee shall
be authorized to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same; and any custodian,
receiver, assignee, trustee, liquidator, sequestrator or other similar official
in any such judicial proceeding is hereby authorized by each Holder to make such
payments to the Trustee and, in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay to the Trustee any
amount due it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, and any other amounts due the
Trustee under Section 607. No provision of this Indenture shall be deemed to
authorize the Trustee to authorize or consent to or accept or adopt on behalf of
any Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Securities or the rights of any Holder thereof or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
SECTION 505. Trustee May Enforce Claims Without Possession of Securities.
All rights of action and claims under this Indenture or the
Securities may be prosecuted and enforced by the Trust without the possession of
any of the Securities or the production thereof in any proceeding relating
thereto, and any such proceeding instituted by the Trustee shall be brought in
its own name as trustee of any express trust, and any recovery of judgment
shall, after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Securities in respect of which such
judgment has been recovered.
SECTION 506. Application of Money Collected.
Subject to Article Eleven, any money collected by the Trustee
pursuant to this Article shall be applied in the following order, at the date or
dates fixed by the Trustee and, in case of the distribution of such money on
account of principal, upon presentation of the Securities and the notation
thereon of the payment, if only partially paid, and upon surrender thereof, if
fully paid;
FIRST: To the payment of all amounts due the Trustee under Section
607; and
SECOND: To the payment of the amounts then due and unpaid for
principal of and interest on the Securities in respect of which or for the
benefit of which such money has been collected, ratably, without preference or
priority of any kind, according to the amounts due and payable as such
Securities for principal and interest, respectively.
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THIRD: To the Company, if any balance shall remain.
SECTION 507. Limitation on Suits.
No Holder of any Security shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture, or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless
(1) such Holder has previously given written notice to the Trustee
of a continuing Event of Default;
(2) the Holders of not less than 25% in principal amount of the
Outstanding Securities shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default in its own name as
Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been
given to the Trustee during such 60-day period by the Holders of a majority in
principal amount of the Outstanding Securities; it being understood and intended
that no one or more Holders 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 Holders, or to obtain or to seek to obtain
priority or preference over any other Holders or to enforce any right under this
Indenture, except in the manner herein provided and for the equal and ratable
benefit of all the Holders.
SECTION 508. Unconditional Right of Holders to Receive Principal and Interest;
Capital Security Holders' Rights.
Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of and (subject to Section 307) interest on
such Security on the Stated Maturity expressed in such Security (or, in the case
of redemption, on the Redemption Date) and to institute suit for the enforcement
of any such payment, and such rights shall not be impaired without the consent
of such Holder.
If an Event of Default constituting the failure to pay interest or
principal on the Securities on the date such interest or principal is otherwise
payable has occurred and is continuing, then a holder of Capital Securities may
directly institute a proceeding for enforcement of payment to such holder
directly of the principal of or interest on the Securities having a principal
amount equal to the aggregate liquidation amount of the Capital Securities
<PAGE> 48
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as such holder on or after the respective due date specified in the Securities.
The Company may not amend this Section without the prior written consent of the
holders of all of the Capital Securities. Notwithstanding any payment made to
such holder of Capital Securities by the Company in connection with such a
Direct Action, the Company shall remain obligated to pay the principal of or
interest on the Securities held by the Trust or the Property Trustee and the
Company 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 Company to such holder in any Direct Action. A holder
of Capital Securities will not be able to exercise directly any other remedy
available to the Holders of the Securities.
SECTION 509. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to
enforce any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceeding, the Company, the Trustee and the Holders shall
be restored severally and respectively to their former positions hereunder and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.
SECTION 510. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities in the last paragraph
of Section 306, no right or remedy herein conferred upon or reserved to the
Trustee or to the Holders is intended to be exclusive of any other right or
remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.
SECTION 511. Delay or Omission not Waiver.
No delay or omission of the Trustee or of any Holder of any Security
to exercise any right or remedy accruing upon any Event of Default shall impair
any such right or remedy or constitute a waiver of any such Event of Default or
an acquiescence therein. Every right and remedy given by this Article or by law
to the Trustee or to the Holders may be exercised from time to time, and as
often as may be deemed expedient, by the Trustee or by the Holders, as the case
may be.
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SECTION 512. Control by Holders.
The Holders of a majority in principal amount of the Outstanding
Securities shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on the Trustee, provided that
(1) such direction shall not be in conflict with any rule of law or
with this Indenture; and
(2) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
SECTION 513. Waiver of Past Defaults.
Subject to Sections 902 and 1008 hereof, the Holders of not less
than a majority in principal amount of the Outstanding Securities may on behalf
of the Holders of all the Securities waive any past default hereunder and its
consequences, except a default
(1) in the payment of the principal of or interest on any Security
(unless such default has been cured and a sum sufficient to pay all matured
installments of interest and principal due otherwise than by acceleration has
been deposited with the Trustee); or
(2) in respect of a covenant or provision hereof which under Article
Nine cannot be modified or amended without the consent of the Holder of each
Outstanding Security affected;
provided, however, that such waiver or modification to such waiver shall not be
effective until the holders of a majority in liquidation preference of Capital
Securities shall have consented to such waiver or modification to such waiver;
provided further, that if the consent of the Holder of each of the Outstanding
Securities is required, such waiver shall not be effective until each holder of
the Capital Securities shall have consented to such waiver.
Upon any such waiver, such default shall cease to exist, effective
as of the date specified in such waiver (and effective retroactively to the date
of default, if so specified) and any Event of Default arising therefrom shall be
deemed to have been cured, for every purpose of this Indenture; but no such
waiver shall extend to any subsequent or other default or impair any right
consequent thereon.
SECTION 514. Undertaking for Costs.
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, suffered or
omitted by it as Trustee, a court may require any party litigant in such suit to
file an undertaking to pay the costs of such suit, and may assess costs against
any such party litigant, in the manner and to the extent provided in the Trust
Indenture Act; provided, that neither this Section nor the Trust
<PAGE> 50
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Indenture Act shall be deemed to authorize any court to require such an
undertaking or to make such an assessment in any suit instituted by the Company
or the Trustee or in any suit for the enforcement of the right to receive the
principal of and interest on any Security.
SECTION 515. Waiver of Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so)
that it will not at any time insist upon, or plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay or extension law wherever
enacted, now or at any time hereafter in force, which may affect the covenants
or the performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
ARTICLE SIX
TRUSTEE
SECTION 601. Certain Duties and Responsibilities.
The duties and responsibilities of the Trustee shall be as provided
by the Trust Indenture Act. Notwithstanding the foregoing, no provision of this
Indenture shall require the Trustee to expend or risk its own funds or otherwise
incur any financial liability in the performance of any of its duties hereunder,
or in the exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it. Whether or not therein
expressly so provided, every provision of this Indenture relating to the conduct
or affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section.
SECTION 602. Notice of Defaults.
The Trustee shall give the Holders notice of any default hereunder
as and to the extent provided by the Trust Indenture Act; provided, however,
that except in the case of a default in the payment of the principal of or
interest on any Security, the Trustee shall be protected in withholding such
notice if and so long as the board of directors, the executive committee or a
trust committee of directors and/or Responsible Officers of the Trustee in good
faith determine that the withholding of such notice is in the interests of the
Holders of Securities; provided, further, that in the case of any default of the
character specified in Section 501(3), no such notice to Holders shall be given
until at least 30 days after the occurrence thereof. For the purpose of this
Section, the term "default" means any event which is, or after notice or lapse
of time or both would become, an Event of Default. For purposes of this Section,
the Trustee shall not be deemed to have knowledge of a default
<PAGE> 51
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unless the Trustee has actual knowledge of such default or has received written
notice of such default in the manner contemplated by Section 105.
SECTION 603. Certain Rights of Trustee.
Subject to the provisions of Section 601:
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document believed by it
to be genuine and to have been signed or presented by the proper party or
parties;
(b) any request or direction of the Company mentioned herein shall
be sufficiently evidenced by a Company Request or Company Order and any
resolution of the Board of Directors may be sufficiently evidenced by a Board
Resolution;
(c) whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other evidence
be herein specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officers' Certificate;
(d) the Trustee may consult with counsel of its choice (and such
counsel may be counsel to the Company or any of its Affiliates and may include
any of its employees) and the advice of such counsel or any Opinion of Counsel
shall be full and complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith and in reliance
thereon;
(e) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders pursuant to this Indenture, unless such Holders shall have
offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities which might be incurred by it in compliance with such
request or direction;
(f) the Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document, but
the Trustee, in its discretion, may make such further inquiry or investigation
into such facts or matters as it may see fit, and, if the Trustee shall
determine to make such further inquiry or investigation, it shall be entitled to
examine the books, records and premises of the Company, personally or by agent
or attorney;
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder; and
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(h) any application by the Trustee for written instructions from the
Company may, at the option of the Trustee, set forth in writing any action
proposed to be taken or omitted by the Trustee under this Indenture and the date
on and/or after which such action shall be taken or such omission shall be
effective. The Trustee shall not be liable to the Company for any action taken
by, or omission of, the Trustee in accordance with a proposal included in such
application on or after the date specified in such application (which date shall
not be less than five Business Days after the date any officer of the Company
actually receives such application, unless any such officer shall have consented
in writing to any earlier date) unless prior to taking any such action (or the
effective date in the case of an omission), the Trustee shall have received
written instructions in response to such application specifying the action to be
taken or omitted.
SECTION 604. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Indenture or of the Securities, the Trustee shall not be accountable for the use
or application by the Company of Securities or the proceeds thereof.
SECTION 605. Trustee and Other Agents may Hold Securities.
The Trustee, any Paying Agent, any Security Registrar, or any other
agent of the Company, in its individual or any other capacity, may become the
owner or pledgee of Securities and, subject to Sections 608 and 613, may
otherwise deal with the Company with the same rights it would have if it were
not Trustee, Paying Agent, Security Registrar, or such other agent. Money held
by the Trustee in trust hereunder shall not be invested by the Trustee pending
distribution thereof to the holders of the Securities.
SECTION 606. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on any money received by it hereunder except as
otherwise agreed in writing with the Company.
SECTION 607. Compensation; Reimbursement; and Indemnity.
The Company, as issuer of the Securities, agrees
(1) to pay to the Trustee from time to time such compensation as the
Company and the Trustee shall from time to time agree in writing for all
services rendered by it hereunder (which compensation shall not be limited by
any provision of law in regard to the compensation of a trustee of an express
trust);
<PAGE> 53
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(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and advances
incurred or made by the Trustee in accordance with any provision of this
Indenture (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense, disbursement
or advance as may be attributable to its negligence or bad faith; and
(3) to indemnify each of the Trustee and any predecessor Trustee
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, revenues or
gross receipts of the Trustee) incurred without negligence or bad faith on its
part, arising out of or in connection with the acceptance or administration of
this trust or the trusts hereunder, including the costs and expenses of
defending itself against any claim or liability in connection with the exercise
or performance of any of its powers or duties hereunder.
The obligations of the Company under this Section to compensate the
Trustee, to pay or reimburse the Trustee for expenses, disbursements and
advances and to indemnify and hold harmless the Trustee shall constitute
additional indebtedness hereunder and shall survive the satisfaction and
discharge of this Indenture. As security for the performance of such obligations
of the Company, the Trustee shall have a lien prior to the Securities upon all
property and lands held or collected by the Trustee as such, except funds held
in trust for the payment of principal of (and premiums, if any, on) or interest
on particular Securities.
When the Trustee incurs expenses or renders services in connection
with an Event of Default specified in Section 501(4) or Section 501(5), 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 and the resignation or removal of the Trustee.
SECTION 608. Disqualification; Conflicting Interests.
If the Trustee has or shall acquire a conflicting interest within
the meaning of the Trust Indenture Act, the Trustee shall either eliminate such
interest or resign, to the extent and in the manner provided by, and subject to
the provisions of, the Trust Indenture Act and this Indenture.
SECTION 609. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which shall be a
Person that is eligible pursuant to the Trust Indenture Act to act as such and
has a combined capital and surplus of at least $50,000,000 and has its Corporate
Trust Office in Chicago, Illinois. If such Person publishes reports of condition
at least annually, pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section, the combined capital
and surplus of such Person shall be deemed to be its combined capital
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and surplus as set forth in its most recent report of condition so published. If
at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section, it shall resign immediately in the manner and with
the effect hereinafter specified in this Article.
SECTION 610. Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 611.
(b) The Trustee may resign at any time by giving written notice
thereof to the Company. If an instrument of acceptance by a successor Trustee
shall not have been delivered to the Trustee within 30 days after the giving of
such notice of resignation, the resigning Trustee may petition any court of
competent jurisdiction for the appointment of a successor Trustee.
(c) The Trustee may be removed at any time by Act of the Holders of
a majority in principal amount of the Outstanding Securities, delivered to the
Trustee and to the Company. If an instrument of acceptance by a successor
Trustee shall not have been delivered to the Trustee within 30 days after the
giving of such notice of removal, the removed Trustee may petition any court of
competent jurisdiction for the appointment of a successor Trustee.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 608 after
written request therefor by the Company or by any Holder who has been a bona
fide Holder of a Security for at least six months, or
(2) the Trustee shall cease to be eligible under Section 609
and shall fail to resign after written request therefor by the Company or by any
such Holder, or
(3) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of its property
shall be appointed or any public officer shall take charge or control of the
Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, then, in any such case, (i) the Company by a Board
Resolution may remove the Trustee, or (ii) subject to Section 514, any Holder
who has been a bona fide Holder of a Security for at least six months may, on
behalf of himself and all others similarly situated, petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee.
(e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause, the
Company, by a Board Resolution, shall promptly appoint a successor Trustee. If,
within one year after such resignation, removal or incapability, or the
occurrence of such vacancy, a successor Trustee shall be appointed by Act of the
Holders of a majority in principal amount of the Outstanding
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Securities delivered to the Company and the Retiring Trustee, the successor
Trustee so appointed shall, forthwith upon its acceptance of such appointment,
become the successor Trustee and supersede the successor Trustee appointed by
the Company. If no successor Trustee shall have been so appointed by the Company
or the Holders and accepted appointment in the manner hereinafter provided, any
Holder who has been a bona fide Holder of a Security for at least six months
may, on behalf of himself and all others similarly situated, petition any court
of competent jurisdiction for the appointment of a successor Trustee.
(f) The Company shall give notice of each resignation and each
removal of the Trustee and each appointment of a successor Trustee to all
Holders in the manner provided in Section 106. Each notice shall include the
name of the successor Trustee and the address of its Corporate Trust Office.
SECTION 611. Acceptance of Appointment by Successor.
Every successor Trustee appointed hereunder shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an instrument
accepting such appointment, and thereupon the resignation or removal of the
retiring Trustee shall become effective and such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee; provided that, on request of
the Company or the successor Trustee, such retiring Trustee shall, upon payment
of its charges, execute and deliver an instrument transferring to such successor
Trustee all the rights, powers and trusts of the retiring Trustee and shall duly
assign, transfer and deliver to such successor Trustee all property and money
held by such retiring Trustee hereunder. Upon request of any such successor
Trustee, the Company shall execute any and all instruments for more fully and
certainly vesting in and confirming to such successor Trustee all such rights,
powers and trusts.
No successor Trustee shall accept its appointment unless at the time
of such acceptance such successor Trustee shall be qualified and eligible under
this Article.
SECTION 612. Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee 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. In case any Securities shall have been authenticated,
but not made available for delivery, by the Trustee then in office, any
successor by merger, conversion or consolidation to such authenticating Trustee
may adopt such authentication and make available for delivery the Securities so
authenticated with the same effect as if such successor Trustee had itself
authenticated such Securities.
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SECTION 613. Preferential Collection of Claims Against Company.
If and when the Trustee shall be or becomes a creditor of the
Company (or any other obligor upon the Securities), the Trustee shall be subject
to the provisions of the Trust Indenture Act regarding the collection of claims
against the Company (or any such other obligor).
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Company to Furnish Trustee Names and Addresses of Holders.
The Company will furnish or cause to be furnished to the Trustee (a)
semi-annually, not later than June 30 and December 31 in each year, a list, in
such form as the Trustee may reasonably require, of the names and addresses of
the Holders to the extent the Company has knowledge thereof as of a date not
more than 15 days prior to the delivery thereof, 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, a list of similar form and content as of a date not more
than 15 days prior to the time such list is furnished, excluding from any such
list names and addresses received by the Trustee in its capacity as Security
Registrar.
SECTION 702. Preservation of Information; Communications to Holders.
(a) The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders contained in the most
recent list furnished to the Trustee as provided in Section 701, and the names
and addresses of Holders received by the Trustee in its capacity as Security
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 701 upon receipt of a new list so furnished.
(b) The rights of Holders to communicate with other Holders with
respect to their rights under this Indenture or under the Securities, and the
corresponding rights and duties of the Trustee, shall be as provided by the
Trust Indenture Act.
(c) 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 agent of either of them shall be held accountable by reason of any
disclosure of information as to names and addresses of Holders made pursuant to
the Trust Indenture Act.
SECTION 703. Reports by Trustee.
(a) The Trustee shall transmit to Holders as of May 15 of each year such
reports concerning the Trustee and its actions under this Indenture as may be
required pursuant to the Trust Indenture Act at the times and in the manner
provided pursuant thereto.
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(b) A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Trustee with each stock exchange upon which the
Securities are listed, with the Commission and with the Company. The Company
will notify the Trustee when the Securities are listed on any stock exchange.
SECTION 704. Reports by Company.
The Company shall file with the Trustee and the Commission, and
transmit to Holders, such information, documents and other reports, and such
summaries thereof, as may be required pursuant to the Trust Indenture Act at the
times and in the manner provided pursuant to such Act; provided that any such
information, documents or reports required to be filed with the Commission
pursuant to Section 13(a) or 15(d) of the Securities and Exchange Act of 1934
shall be filed with the Trustee within 15 days after the same is so required to
be filed with the Commission. 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).
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company May Consolidate, Etc., Only on Certain Terms.
The Company shall not consolidate with or merge into any other
Person or convey, transfer or lease its properties and assets substantially as
an entirety to any Person, unless:
(1) the Person formed by such consolidation or into which the
Company is merged or the Person that acquires by conveyance or transfer, or
which leases, the properties and assets of the Company substantially as an
entirety shall be a corporation, partnership or trust, shall be organized and
existing under the laws of the United States of America or any State or the
District of Columbia, and shall expressly assume, by an indenture supplemental
hereto, executed and delivered to the Trustee, in form satisfactory to the
Trustee, the due and punctual payment of the principal of (and premium, if any)
and interest (including any additional interest) on all the Securities and the
performance of every covenant of this Indenture on the part of the Company to be
performed or observed;
(2) immediately after giving effect to such transaction, no Event of
Default, and no event which, after notice or lapse of time, or both, would
become an Event of Default, shall have happened and be continuing;
(3) for so long as Securities registered on the Securities Register
in the name of the Trust (or the Property Trustee) are outstanding, such
consolidation, merger,
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conveyance, transfer or lease is permitted under the Declaration and the
Guarantee and does not give rise to any breach or violation of the Declaration
or the Guarantee;
(4) any such lease shall provide that it will remain in effect so
long as any Securities are Outstanding; and
(5) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel each stating that such consolidation,
merger, conveyance, transfer or lease and any such supplemental indenture
complies with this Article and that all conditions precedent herein provided for
relating to such transaction have been complied with; and the Trustee, subject
to Section 601, may rely upon such Officers' Certificate and Opinion of Counsel
as conclusive evidence that such transaction complies with this Section 801.
SECTION 802. Successor Person Substituted.
Upon any consolidation or merger by the Company with or into any
other Person, or any conveyance, transfer or lease by the Company of its
properties and assets substantially as an entirety to any Person in accordance
with Section 801, the successor Person formed by such consolidation or into
which the Company is merged or to which such conveyance, transfer or lease is
made shall succeed to, and be substituted for, and may exercise every right and
power of, the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein; and, in the event of any
such conveyance, transfer or lease the Company shall be discharged from all
obligations and covenants under the Indenture and the Securities and may be
dissolved and liquidated.
Such successor Person may cause to be signed, and may issue either
in its own name or in the name of the Company, any or all of the Securities
issuable hereunder which theretofore shall not have been signed by the Company
and delivered to the Trustee; 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 shall authenticate and shall make
available for delivery any Securities which previously shall have been signed
and delivered by the officers of the Company to the Trustee for authentication
pursuant to such provisions and any Securities which such successor Person
thereafter shall cause to be signed and delivered to the Trustee on its behalf
for the purpose pursuant to such provisions. All the Securities so issued shall
in all respects have the same legal rank and benefit under this Indenture as the
Securities theretofore 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.
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ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Company, when authorized by
a Board Resolution, and the Trustee, at any time and from time to time, may
enter into one or more indentures supplemental hereto, in form satisfactory to
the Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the Company and
the assumption by any such successor of the covenants of the Company herein and
in the Securities; or
(2) to add to the covenants of the Company for the benefit of the
Holders, or to surrender any right or power herein conferred upon the Company;
or
(3) to cure any ambiguity or defect, to correct or supplement any
provision herein which may be inconsistent with any other provision herein, or
to make any other provisions with respect to matters or questions arising under
this Indenture which shall not be inconsistent with the provisions of this
Indenture, provided that such action pursuant to this clause (3) shall not
adversely affect the interests of the Holders of the Securities or, so long as
any of the Capital Securities shall remain outstanding, the holders of the
Capital Securities; or
(4) to comply with any requirement of the Commission in order to
effect or maintain the qualification of this Indenture under the Trust Indenture
Act.
SECTION 902. Supplemental Indentures With Consent of Holders.
With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities, by Act of said Holders delivered
to the Company and the Trustee, the Company, when authorized by a Board
Resolution, and the Trustee may enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or of
modifying in any manner the rights of the Holders under this Indenture;
provided, however, that no such supplemental indenture shall, without the
consent of the Holder of each Outstanding Security affected thereby,
(1) change the Stated Maturity of, the principal of, or any
installment of interest on, any Security, or reduce the principal amount thereof
or the rate of interest thereon or extend the time of payment of interest
thereon (except such extension as is contemplated hereby), or change the place
of payment where, or the coin or currency in which, any Security or interest
thereon is payable, or impair the right to institute suit for the enforcement of
any such payment on or after the Stated Maturity thereof (or, in the case of
redemption, on
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or after the Redemption Date), or modify the provisions of this Indenture with
respect to the subordination of the Securities in a manner adverse to the
Holders,
(2) reduce the percentage in principal amount of the Outstanding
Securities, the consent of whose Holders is required for any such supplemental
indenture, or the consent of whose Holders is required for any waiver of
compliance with certain provisions of this Indenture or certain defaults
hereunder and their consequences provided for in this Indenture, or
(3) modify any of the provisions of this Section, Section 513 or
Section 1008, except to increase any such percentage or to provide that certain
other provisions of this Indenture cannot be modified or waived without the
consent of the Holder of each Outstanding Security affected thereby; provided,
that, so long as any of the Capital Securities remains outstanding, no such
amendment shall be made that adversely affects the holders of the Capital
Securities, and no termination of this Indenture shall occur, and no waiver of
any Event of Default or compliance with any covenant under this Indenture shall
be effective, without the prior consent of the holders of at least a majority of
the aggregate liquidation amount of the outstanding Capital Securities unless
and until the principal of and any premium on the Securities and all accrued and
unpaid interest thereon have been paid in full.
It shall not be necessary for any Act of Holders under this Section
to approve the particular form of any proposed supplemental indenture, but it
shall be sufficient if such Act shall approve the substance thereof.
SECTION 903. Execution of Supplemental Indentures.
In executing, or accepting the additional trust created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 601) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Trustee may, but shall not be
obligated to, enter into such supplemental indenture which affects the Trustee's
own rights, duties or immunities under this Indenture or otherwise.
SECTION 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
SECTION 905. Conformity With Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act.
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SECTION 906. Reference in Securities to Supplemental Indentures.
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article may, and shall if required by
the Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company shall so determine,
new Securities so modified as to conform, in the opinion of the Trustee and the
Company, to any such supplemental indenture may be prepared and executed by the
Company and authenticated and made available for delivery by the Trustee in
exchange for Outstanding Securities.
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal and Interest.
The Company will duly and punctually pay the principal of and
interest on the Securities in accordance with the terms of the Securities and
this Indenture and comply with all other terms and conditions and agreements
contained herein.
SECTION 1002. Maintenance of Office or Agency.
The Company will maintain in The City of New York an office or
agency where Securities may be presented or surrendered for registration of
transfer or exchange, where Securities may be surrendered for conversion and
where notices and demands to or upon the Company in respect of the Securities
and this Indenture may be served. The Company will give prompt written notice to
the Trustee of the location, and any change in location, of such office or
agency. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee, and the Company hereby appoints the
Trustee as its agent to receive all such presentations, surrenders, notices and
demands.
The Company may also from time to time designate one or more other
offices or agencies in the United States where the Securities may be presented
or surrendered for any or all such purposes and may from time to time rescind
such designations; provided, however, that no such designation or rescission
shall in any manner relieve the Company of its obligation to maintain an office
or agency in the United States for such purposes. The Company will give prompt
written notice to the Trustee of any such designation or rescission and of any
change in the location of any such other office or agency.
SECTION 1003. Money for Security Payments to be Held in Trust.
If the Company shall at any time act as its own Paying Agent, it
will, on, or at the option of the Company, before each due date of the principal
of or interest on any of the
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Securities, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum sufficient to pay the principal or interest so becoming due until
such sums shall be paid to such Persons or otherwise disposed of as herein
provided and will promptly notify the Trustee of its action or failure so to
act. In such case the Company shall not invest the amount so segregated and held
in trust pending the distribution thereof.
Whenever the Company shall have one or more Paying Agents, it will,
on or prior to each due date of the principal of or interest on any Securities,
deposit with a Paying Agent a sum sufficient to pay such amount, such sum to be
held as provided by the Trust Indenture Act, and (unless such Paying Agent is
the Trustee) the Company will promptly notify the Trustee of its action or
failure so to act; provided, however, that any such deposit on a due date shall
be initiated prior to 12:00 noon (New York time) in same-day funds.
The Company will cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section, that
such Paying Agent will (i) comply with the provisions of the Trust Indenture Act
applicable to it as a Paying Agent and (ii) during the continuance of any
default by the Company (or any other obligor upon the Securities) in the making
of any payment in respect of the Securities, upon the written request of the
Trustee, forthwith pay to the Trustee all sums held in trust by such Paying
Agent as such.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
the trust by the Company or such Paying Agent, such sums to be held by the
Trustee upon the same trusts as those upon which such sums were held by the
Company or such Paying Agent; and, upon such payment by any Paying Agent to the
Trustee, such Payment Agent shall be released from all further liability with
respect to such money.
Any money deposited with the Trustee or any Paying Agent, or then
held by the Company, in trust for the payment of the principal or interest that
has become due and payable shall be paid to the Company on Company Request, or
(if then held by the Company) shall be discharged from such trust; and the
Holder of such Security shall thereafter, as an unsecured general creditor, look
only to the Company for payment thereof, and all liability of the Trustee or
such Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease.
SECTION 1004. Statements by Officers as to Default.
The Company will deliver to the Trustee, within 120 days after the
end of each fiscal year of the Company ending after the date hereof, an
Officers' Certificate, stating whether or not to the best knowledge of the
signers thereof the Company is in default in the performance and observance of
any of the material terms, provisions and conditions of this Indenture (without
regard to any period of grace or requirement of notice provided hereunder) and,
if the Company shall be in default, specifying all such defaults and the nature
and status thereof of which they may have knowledge.
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SECTION 1005. Existence.
Subject to Article Eight, the Company will do or cause to be done
all things necessary to preserve and keep in full force and effect its
existence, rights (charter and statutory) and franchises; provided, however,
that the Company shall not be required to preserve any such right or franchise
if the Board of Directors shall determine that the preservation thereof is no
longer desirable in the conduct of the business of the Company and that the loss
thereof is not disadvantageous in any material respect to the Holders and, while
any Capital Securities are outstanding, the holders of the Capital Securities.
SECTION 1006. Maintenance of Properties.
The Company will cause all properties used or useful in the conduct
of its business or the business of any Subsidiary to be maintained and kept in
good condition, repair and working order and supplied with all necessary
equipment and will cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment of
the Company may be necessary so that the business carried on in connection
therewith may be properly and advantageously conducted at all times; provided,
however, that nothing in this Section shall prevent the Company from
discontinuing the operation or maintenance of any such properties if such
discontinuance is, in the judgment of the Company, desirable in the conduct of
its business or the business of any Subsidiary and not disadvantageous in any
material respect to the Holders.
SECTION 1007. Payment of Taxes and Other Claims.
The Company will pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (1) all taxes, assessments and
governmental charges levied or imposed upon the Company or any Subsidiary or
upon the income, profits or property of the Company or any Subsidiary, and (2)
all lawful claims for labor, materials and supplies which, if unpaid, might by
law become a lien upon the property of the Company or any Subsidiary that
comprise more than 10% of the assets of the Company and its Subsidiaries, taken
as a whole; provided, however, that the Company shall not be required to pay or
discharge or cause to be paid or discharged any such tax, assessment, charge or
claim whose amount, applicability or validity is being contested in good faith
by appropriate proceedings.
SECTION 1008. Waiver of Certain Covenants.
Except as otherwise specified or as contemplated by Section 301 for
Securities, the Company may, with respect to the Securities, omit in any
particular instance to comply with any term, provision or condition set forth in
any covenant provided pursuant to Section 901(2) for the benefit of the Holders
if before the time for such compliance the Holders of at least a majority in
principal amount of the Outstanding Securities shall, by Act of such Holders,
either waive such compliance in such instance or generally waive compliance with
such term, provision or condition, but no waiver shall extend to or affect such
term, provision or condition except to the extent so expressly waived, and,
until such waiver shall become
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effective, the obligations of the Company and the duties of the Trustee in
respect of any such term, provision or condition shall remain in full force and
effect.
SECTION 1009. Payment of the Trust's Costs and Expenses.
Since the Trust is being formed solely to facilitate an investment
in the Securities, the Company, as borrower, hereby covenants to pay all debts
and obligations (other than with respect to the Capital Securities and Common
Securities) and all costs and expenses of the Trust (including, but not limited
to, all costs and expenses relating to the organization of the Trust, the fees
and expenses of the trustees of the Trust and all costs and expenses relating to
the operation of the Trust) and to pay any and all taxes, duties, assessments or
governmental charges of whatever nature (other than withholding taxes) imposed
on the Trust by the United States, or any other taxing authority, so that the
net amounts received and retained by the Trust and the Property Trustee after
paying such expenses will be equal to the amounts the Trust and the Property
Trustee would have received had no such costs or expenses been incurred by or
imposed on the Trust. The foregoing obligations of the Company are for the
benefit of, and shall be enforceable by, any person to whom any such debts,
obligations, costs, expenses and taxes are owed (each, a "Creditor") whether or
not such Creditor has received notice thereof. Any such Creditor may enforce
such obligations of the Company directly against the Company, and the Company
irrevocably waives any right or remedy to require that any such Creditor take
any action against the Trust or any other person before proceeding against the
Company. The Company shall execute such additional agreements as may be
necessary or desirable to give full effect to the foregoing.
SECTION 1010. Restrictions on Payments and Distributions.
The Company will not, and will not permit any Subsidiary to, (i)
declare or pay any dividends or distributions on, or redeem, purchase, acquire,
or make a liquidation payment with respect to, any of the Company's capital
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 interest to the Securities or make any guarantee
payments with respect to any guarantee by the Company of the debt securities of
any Subsidiary if such guarantee ranks pari passu with or junior in interest to
the Securities, (other than (a) repurchases, redemptions or other acquisitions
of shares of capital stock of the Company in connection with any employment
contract, benefit plan or other similar arrangement with or for the benefit of
any one or more employees, officers, directors or consultants or in connection
with a dividend reinvestment or stockholder stock purchase plan, (b) as a result
of an exchange or conversion of any class or series of the Company's capital
stock (or any capital stock of a subsidiary of the Company) for any class or
series of the Company's capital stock or of any class or series of the Company's
indebtedness for any class or series of the Company's capital stock, (c) 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, (d) any declaration of a dividend in
connection with the adoption of any stockholder's rights plan, or the issuance
of rights, stock or other property under any stockholder's rights plan, or the
redemption or
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repurchase of rights pursuant thereto, or (e) any dividend in the form of stock,
warrants, options or other rights where the dividend stock or the stock issuable
upon exercise of such warrants, options or other rights is the same stock as
that on which the dividend is being paid or ranks pari passu with or junior to
such stock) if at such time (x) there shall have occurred any event of which the
Company has actual knowledge that (I) with the giving of notice or the lapse of
time, or both, would constitute an Event of Default and (II) in respect of which
the Company shall not have taken reasonable steps to cure, (y) the Company shall
be in default with respect to its payment of any obligations under the Guarantee
or (z) the Company shall have given notice of its election of an Extension
Period as provided herein and shall not have rescinded such notice, or such
Extension Period, or any extension thereof, shall be continuing.
ARTICLE ELEVEN
SUBORDINATION OF SECURITIES
SECTION 1101. Securities Subordinate to Indebtedness.
The Company covenants and agrees, and each Holder of a Security, by
his acceptance thereof, likewise covenants and agrees, that, to the extent and
in the manner hereinafter set forth in this Article (subject to Article Four),
the payment of the principal of and interest on each and all of the Securities
are hereby expressly made subordinate and subject in right of payment to the
prior payment in full of all Indebtedness.
The provisions of this Article Eleven are made for the benefit of
the holders of Indebtedness and such holders are made obligees hereunder and any
one or more of them may enforce such provisions. Holders of Indebtedness need
not prove reliance on the subordination provisions hereof.
SECTION 1102. Default on Indebtedness.
In the event and during the continuation of any default in the
payment of principal, premium, interest or any other payment due on any
Indebtedness, or in the event that any event of default with respect to any
Indebtedness shall have occurred and be continuing and shall have resulted in
such Indebtedness becoming or being declared due and payable prior to the date
on which it would otherwise have become due and payable (unless and until such
event of default shall have been cured or waived or shall have ceased to exist
and such acceleration shall have been rescinded or annulled) or in the event any
judicial proceeding shall be pending with respect to any such default in payment
or such event of default, then no payment shall be made by the Company with
respect to the principal (including redemption payments) of, or interest on, the
Securities.
In the event that, notwithstanding the foregoing, any payment shall
be received by the Trustee or any Holder when such payment is prohibited by the
preceding paragraph of this Section 1102, such payment shall be held in trust
for the benefit of, and shall be paid
<PAGE> 66
56
over or delivered to, the holders of Indebtedness or their respective
representatives, or to the trustee or trustees under any indenture pursuant to
which any of such Indebtedness may have been issued, as their respective
interests may appear, but only to the extent that the holders of the
Indebtedness (or their representative or representatives or a trustee) notify
the Trustee within 90 days of such payment of the amounts then due and owing on
the Indebtedness and only the amounts specified in such notice to the Trustee
shall be paid to the holders of Indebtedness; provided, however, that holders of
Indebtedness shall not be entitled to receive payment of any such amounts to the
extent that such holders would be required by the subordination provisions of
such Indebtedness to pay such amounts over to the obligees on trade accounts
payable or other liabilities arising in the ordinary course of the Company's
business.
SECTION 1103. Prior Payment of Indebtedness Upon Acceleration of Securities.
In the event that the Securities are declared due and payable before
their Stated Maturity, then and in such event the holders of the Indebtedness
outstanding at the time such Securities so become due and payable shall be
entitled to receive payment in full of all amounts then due on or in respect of
such Indebtedness (including any amounts due upon acceleration), or provision
shall be made for such payment in cash or cash equivalents or otherwise in a
manner satisfactory to the holders of such Indebtedness, before the Holders of
the Securities are entitled to receive any payment or distribution of any kind
or character, whether in cash, properties or securities, by the Company on
account of the principal of or interest on the Securities or on account of the
purchase or other acquisition of Securities by the Company or any Subsidiary;
provided, however, that holders of Indebtedness shall not be entitled to receive
payment of any such amounts to the extent that such holders would be required by
the subordination provisions of such Indebtedness to pay such amounts over to
the obligees on trade accounts payable or other liabilities arising in the
ordinary course of the Company's business.
In the event that, notwithstanding the foregoing, any payment shall
be received by the Trustee or any Holder when such payment is prohibited by the
preceding paragraph of this Section 1103, such payment shall be held in trust
for the benefit of, and shall be paid over or delivered to, the holders of
Indebtedness or their respective representatives, or to the trustee or trustees
under any indenture pursuant to which any of such Indebtedness may have been
issued, as their respective interests may appear, but only to the extent that
the holders of the Indebtedness (or their representative or representatives or a
trustee) notify the Trustee within 90 days of such payment of the amounts then
due and owing on the Indebtedness and only the amounts specified in such notice
to the Trustee shall be paid to the holders of Indebtedness.
SECTION 1104. 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 principal of,
<PAGE> 67
57
and premium, if any, and interest due or to become due upon all Indebtedness
(including interest after the commencement of any bankruptcy, insolvency,
receivership or other proceedings at the rate specified in the applicable
Indebtedness, whether or not such interest is an allowable claim in any such
proceeding) shall first be paid in full, or payment thereof provided for in
accordance with its terms, before any payment is made on account of the
principal 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 substantially all of the assets of the Company of any kind or
character, whether in cash, property or securities, to which the Holders of the
Securities or the Trustee would be entitled, except for the provisions of this
Article Eleven, 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 Holders of the Securities or by the Trustee under this
Indenture if received by them or it, directly to the holders of Indebtedness
(pro rata to such holders on the basis of the respective amounts of 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 any Indebtedness may have been issued, as their
respective interests may appear, to the extent necessary to pay all Indebtedness
in full (including interest after the commencement of any bankruptcy,
insolvency, receivership or other proceedings at the rate specified in the
applicable Indebtedness, whether or not such interest is in an allowable claim
in any such proceeding) or to provide for such payment in accordance with its
terms, after giving effect to any concurrent payment or distribution to or for
the holders of Indebtedness, before any payment or distribution is made to the
Holders of Securities or to the Trustee or the Property Trustee on behalf of the
Holders of Capital Securities; provided, however, that such holders of
Indebtedness shall not be entitled to receive payment of any such amounts to the
extent that such holders would be required by the subordination provisions of
such Indebtedness to pay such amounts over to the obligees on trade accounts
payable or other liabilities arising in the ordinary course of the Company's
business.
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 or the Holders of the Securities before all Indebtedness is paid in full
(including interest after commencement of any bankruptcy, insolvency,
receivership or other proceedings at the rate specified in the applicable
Indebtedness, whether or not such interest is an allowable claim in any such
proceeding), or provision is made for such payment 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 Indebtedness or their representative
or representatives, or to the trustee or trustees under any indenture pursuant
to which any instruments evidencing any Indebtedness may have been issued, as
their respective interests may appear, as calculated by the Company, for
application to the payment of all Indebtedness remaining unpaid to the extent
necessary to pay all Indebtedness in full in accordance with its terms, after
giving effect to any concurrent payment or distribution to or for the holders of
such Indebtedness.
<PAGE> 68
58
Any holder of Indebtedness may file any proof of claim or similar
instrument on behalf of the Trustee and the Holders if such instrument has not
been filed by the date which is 30 days prior to the date specified for filing
thereof.
For purposes of this Article Eleven, 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 Eleven with
respect to the Securities to the payment of all Indebtedness that may at the
time be outstanding, provided, however, that (i) the Indebtedness is assumed by
the new corporation, if any, resulting from any such reorganization or
readjustment, and (ii) the rights of the holders of the Indebtedness are not,
without the consent of such holders, altered by such reorganization or
readjustment. The consolidation of the Company with, or merger of the Company
into, another corporation or the liquidation or dissolution of the Company
following the conveyance or transfer of its property as an entirety, or
substantially as an entirety, to another corporation upon the terms and
conditions provided for in Article Eight hereof shall not be deemed a
dissolution, winding-up, liquidation or reorganization for the purposes of this
Section 1104 if such other corporation shall, as a part of such consolidation,
merger, conveyance or transfer, comply with the conditions stated in Article
Eight hereof. Nothing in Section 1103 or in this Section 1104 shall apply to
claims of, or payments to, the Trustee under or pursuant to Section 607.
SECTION 1105. Subrogation.
Subject to the payment of all Indebtedness to the extent provided in
Sections 1103 and 1104 of this Indenture, the rights of the Holders of the
Securities shall be subrogated to the rights of the holders of Indebtedness to
receive payments or distributions of cash, property or securities of the Company
applicable to the 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 the Indebtedness of
any cash, property or securities to which the Holders of the Securities or the
Trustee would be entitled except for the provisions of this Article Eleven,
shall, as between the Company, its creditors other than holders of Indebtedness,
and the Holders of the Securities, be deemed to be a payment by the Company to
or on account of the Indebtedness. It is understood that the provisions of this
Article Eleven 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 the Indebtedness on the other hand.
Nothing contained in this Article Eleven 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 Indebtedness, 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 other than the holders of the Indebtedness, nor shall anything
herein or therein prevent the Trustee or the Holder of any
<PAGE> 69
59
Security from exercising all remedies otherwise permitted by applicable law upon
default under this Indenture, subject to the rights, if any, under this Article
Eleven of the holders of Indebtedness in respect of cash, property or securities
of the Company received upon the exercise of any such remedy.
Upon any payment or distribution of assets of the Company referred
to in this Article Eleven, the Trustee, subject to the provisions of Section
601, and the Holders of the Securities, shall be entitled to 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 Holders of the Securities, for the purposes of ascertaining the Persons
entitled to participate in such distribution, the holders of the 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 Eleven.
SECTION 1106. Trustee to Effectuate Subordination.
Each Holder of a Security by acceptance thereof authorizes and
directs the Trustee on such Holder's behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in this
Article Eleven and appoints the Trustee such Holder's attorney-in-fact for any
and all such purposes.
SECTION 1107. 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 Eleven. Notwithstanding
the provisions of this Article Eleven 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 Eleven,
unless and until a Responsible Officer of the Trustee shall have received
written notice thereof at the Corporate Trust Office of the Trustee from the
Company or a holder or holders of Indebtedness or from any trustee therefor; and
before the receipt of any such written notice, the Trustee, subject to the
provisions of Section 601, 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 1107 at least three 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 three Business Days prior to such date.
<PAGE> 70
60
The Trustee, subject to the provisions of Section 601, shall be
entitled to rely on the delivery to it of a written notice by a Person
representing himself to be a holder of Indebtedness (or a trustee on behalf of
such holder) to establish that such notice has been given by a holder of
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 Indebtedness to participate in
any payment or distribution pursuant to this Article Eleven, the Trustee may
request such Person to furnish evidence to the reasonable satisfaction of the
Trustee as to the amount of 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
Eleven, 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.
SECTION 1108. Rights of the Trustee; Holders of Indebtedness.
The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article Eleven in respect of any Indebtedness at any
time held by it, to the same extent as any other holder of Indebtedness, and
nothing in this Indenture shall deprive the Trustee of any of its rights as such
holder.
With respect to the holders of Indebtedness, the Trustee undertakes
to perform or to observe only such of its covenants and obligations as are
specifically set forth in this Article Eleven, and no implied covenants or
obligations with respect to the holders of 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 Indebtedness and, subject to the provisions of
Section 601, the Trustee shall not be liable to any holder of Indebtedness if it
shall pay over or deliver to holders of Securities, the Company or any other
Person money or assets to which any holder of Indebtedness shall be entitled by
virtue of this Article Eleven or otherwise.
SECTION 1109. Subordination May Not Be Impaired.
No right of any present or future holder of any Indebtedness 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
or by any act or failure to act, in good faith, by any such holder, or by any
noncompliance by the Company 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 Indebtedness may, at any time and from time to time,
without the consent of or notice to the Trustee or the Holders of the
Securities, without incurring responsibility to the Holders of the Securities
and without impairing or releasing the subordination provided in this Article or
the obligations hereunder of the Holders of the Securities to the holders of
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,
Indebtedness or otherwise
<PAGE> 71
61
amend or supplement in any manner Indebtedness or any instrument evidencing the
same or any agreement under which Indebtedness is outstanding; (ii) sell,
exchange, release or otherwise deal with any property pledged, mortgaged or
otherwise securing Indebtedness; (iii) release any Person liable in any manner
for the collection of Indebtedness; and (iv) exercise or refrain from exercising
any rights against the Company and any other Person.
ARTICLE TWELVE
REDEMPTION OF SECURITIES
SECTION 1201. Optional Redemption; Conditions to Optional Redemption.
At any time on or after June 15, 2007, the Company shall have the
right, subject to the last paragraph of this Section 1201 and to the receipt of
any necessary prior approval of the Federal Reserve, to redeem the Securities,
in whole or in part, from time to time, at a Redemption Price equal to 100% of
the principal amount of Securities to be redeemed plus any accrued but unpaid
interest (including any Additional Interest) to the Redemption Date.
If a Special Event shall occur and be continuing, the Company shall
have the right, subject to the last paragraph of this Section 1201 and to the
receipt of any necessary prior approval of the Federal Reserve, to redeem, upon
not less than 30 days nor more than 60 days notice, the Securities in whole, but
not in part, at a Redemption Price equal to 100% of the principal amount of
Securities then outstanding plus accrued but unpaid interest (including any
Additional Interest) to the Redemption Date.
For so long as the Trust is the Holder of all Securities
Outstanding, the proceeds of any redemption described in this Section 1201 shall
be used by the Trust to redeem Common Securities and Capital Securities in
accordance with their terms. The Company shall not redeem the Securities in part
unless all accrued and unpaid interest (including any Additional Interest) has
been paid in full on all Securities outstanding for all quarterly interest
periods terminating on or prior to the Redemption Date.
SECTION 1202. Applicability of Article.
Redemption of Securities at the election of the Company, as
permitted by Section 1201, shall be made in accordance with such provision and
this Article.
SECTION 1203. Election to Redeem; Notice to Trustee.
The election of the Company to redeem Securities pursuant to Section
1201 shall be evidenced by a Board Resolution. In case of any redemption at the
election of the Company, the Company shall, at least 45 days and no more than 60
days prior to the Redemption Date fixed by the Company, notify the Trustee of
such Redemption Date and of
<PAGE> 72
62
the principal amount of Securities to be redeemed and provide a copy of the
notice of redemption given to Holders of Securities to be redeemed pursuant to
Section 1205.
SECTION 1204. Selection by Trustee of Securities to be Redeemed.
If less than all the Securities are to be redeemed (unless such
redemption affects only a single Security), the particular Securities to be
redeemed shall be selected by lot (or such other method of selection as the
Trustee may customarily employ) not more than 60 days prior to the Redemption
Date by the Trustee, from the Outstanding Securities not previously called for
redemption.
The Trustee shall promptly notify the Company in writing of the
Securities selected for redemption as aforesaid and, in case of any Securities
selected for partial redemption as aforesaid, the principal amount thereof to be
redeemed.
The provisions of the two preceding paragraphs shall not apply with
respect to any redemption affecting only a single Security, whether such
Security is to be redeemed in whole or in part. In the case of any such
redemption in part, the unredeemed portion of the principal amount of the
Security shall be in an authorized denomination (which shall not be less than
the minimum authorized denomination) for such Security.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall relate,
in the case of any Securities redeemed or to be redeemed only in part, to the
portion of the principal amount of such Securities which has been or is to be
redeemed.
SECTION 1205. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not less than 30 (provided that the Trustee shall itself have
received notice not less than 45 days prior to the Redemption Date) nor more
than 60 days prior to the Redemption Date, to each Holder of Securities to be
redeemed, at his address appearing in the Security Register.
All notices of redemption shall identify the Securities to be
redeemed (including CUSIP number) and shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) that on the Redemption Date the Redemption Price will become due
and payable upon each such Security to be redeemed and that interest thereon
will cease to accrue on and after said date, and
(4) the place or places where such Securities are to be surrendered
for payment of the Redemption Price.
<PAGE> 73
63
Notice of redemption of Securities to be redeemed at the election of
the Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company.
SECTION 1206. Deposit of Redemption Price.
On or prior to any Redemption Date, the Company shall deposit with
the Trustee or with a Paying Agent (or, if the Company is acting as its own
Paying Agent, segregate and hold in trust as provided in Section 1003) an amount
of money sufficient to pay the Redemption Price of, and (except if the
Redemption Date shall be an Interest Payment Date) accrued interest (including
any Additional Interest) on, all the Securities which are to be redeemed on that
date; provided, however, that any such deposit on a Redemption Date shall be
initiated prior to 12:00 noon (New York time) in same-day funds.
SECTION 1207. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Securities
so to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified, and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued
interest (including any Additional Interest)) such Securities shall cease to
bear interest. Upon surrender of any such Security for redemption in accordance
with said notice, such Security shall be paid by the Company at the Redemption
Price, together with accrued interest to the Redemption Date; provided, however,
that installments of interest whose Stated Maturity is on or prior to the
Redemption Date shall be payable to the Holders of such Securities, or one or
more Predecessor Securities, registered as such at the close of business on the
relevant Record Dates according to their terms and the provisions of Section
307.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal shall, until paid, bear interest
from the Redemption Date at the rate borne by the Security.
SECTION 1208. Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall be
surrendered at a place of payment therefor (with, if the Company or the Trustee
so requires, due endorsement by, or a written instrument of transfer in form
satisfactory to the Company and the Trustee duly executed by, the Holder
therefor or his attorney duly authorized in writing), and the Company shall
execute, and the Trustee shall authenticate and deliver to the Holder of such
Security without service charge, a new Security or Securities, of any authorized
denomination as requested by such Holder, in aggregate principal amount equal to
and in exchange for the unredeemed portion of the principal of the Security so
surrendered.
This instrument may be executed in any number of counterparts, each
of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
<PAGE> 74
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, all as of the day and year first above written.
STAR BANC CORPORATION
By: /s/ BRUCE BARNES
---------------------------------------
Name: Bruce Barnes
Title: SVP and Treasurer
THE FIRST NATIONAL BANK OF
CHICAGO, as Trustee
By: /s/ JOHN R. PRENDIVILLE
---------------------------------------
Name: John R. Prediville
Title: Vice President
<PAGE> 75
EXHIBIT A
STAR BANC CORPORATION
Floating Rate Junior Subordinated Debenture due 2027
$___________________
No. __
CUSIP No. [if any]
STAR BANC CORPORATION, a corporation duly organized and
existing under the laws of the State of Ohio (herein called the "Company", which
term includes any successor corporation under the Indenture hereinafter referred
to), for value received, hereby promises to pay to The First National Bank of
Chicago, as Trustee, or registered assigns, the principal sum of
____________________ ($________) on June 15, 2027, and to pay interest on said
principal sum from June 8, 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 the 15th day of June, September, December and March of each year,
commencing September 15, 1997, at a variable per annum rate equal to LIBOR (as
defined in the Indenture) plus 0.765% until the principal hereof shall have
become due and payable (plus Additional Interest, if any), and on any overdue
principal and (without duplication and to the extent that payment of such
interest is enforceable under applicable law) on any overdue installment of
interest at the same rate per annum. The amount of interest payable for any
period will be computed on the actual number of days elapsed and a year of 360
days. The amount of interest payable for any period shorter than a full
quarterly period for which interest is computed, will be computed on the basis
of actual number of days elapsed in such 90-day period. In the event that any
date on which interest is payable on this Security is not a Business Day, then a
payment of the interest payable on such date will be made on the next succeeding
day which is a Business Day (and without any interest or other payment in
respect of any such delay), with the same force and effect as if made on the
date the payment was originally payable. A "Business Day" shall mean any day
other than a Saturday or a Sunday or a day on which banking institutions in the
New York City, Chicago, Illinois or Cincinnati, Ohio are authorized or required
by law or executive order to remain closed or a day on which the Corporate Trust
Office of the Trustee, or the principal office of the Property Trustee under the
Declaration, is closed for business. The interest installment so payable, and
punctually paid or duly provided for, on any Interest Payment Date will, as
provided in the Indenture, be paid to the Person in whose name the Securities
(or one or more Predecessor Securities, as defined in the Indenture) is
registered at the close of business on the Regular Record Date for such interest
installment, which shall be the 1st day of the month in which such Interest
Payment Date occurs. Any such interest installment not so punctually paid or
duly provided for shall forthwith cease to be payable to the Holder on such
Regular Record Date and may either be paid to the Person in whose name the
Securities for one or more Predecessor Securities is registered at the close of
business on a Special Record Date for the payment of such Defaulted Interest to
be fixed by the Trustee, notice whereof shall be given to Holders of Securities
not less than 10 days prior to such Special Record Date, or be paid at any time
in
<PAGE> 76
any other lawful manner not inconsistent with the requirements of any securities
exchange on which the Securities may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in said Indenture.
The Company shall have the right at any time during the term
of this Security, from time to time, to defer payment of interest on such
Security for up to 20 quarterly periods (an "Extension Period"), provided that
no Extension Period may extend past the Stated Maturity of this Security. There
may be multiple Extension Periods of varying lengths during the term of this
Security. At the end of each Extension Period, if any, the Company shall pay all
interest then accrued and unpaid, together with interest thereon, compounded
quarterly at the rate specified on this Security to the extent permitted by
applicable law. During any such Extension Period, the Company may not, and may
not permit any subsidiary of the Company to, (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire, or make a liquidation payment
with respect to, any of the Company's capital stock or (ii) make any payment of
principal, interest or premium, if any, on or repay, repurchase or redeem any
debt securities of the Company that rank pari passu with or junior in interest
to the Securities or make any guarantee payments with respect to any guarantee
by the Company of the debt securities of any subsidiary of the Company if such
guarantee ranks pari passu or junior in interest to the Securities (other than
(a) repurchases, redemptions or other acquisitions of shares of capital stock of
the Company in connection with any employment contract, benefit plan or other
similar arrangement with or for the benefit of any one or more employees,
officers, directors or consultants or in connection with a dividend reinvestment
or stockholder stock purchase plan, (b) as a result of an exchange or conversion
of any class or series of the Company's capital stock (or any capital stock of a
subsidiary of the Company) for any class or series of the Company's capital
stock or of any class or series of the Company's indebtedness for any class or
series of the Company's capital stock, (c) 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,
(d) any declaration of a dividend in connection with the adoption of any
stockholder's rights plan, or the issuance of rights, stock or other property
under any stockholder's rights plan, or the redemption or repurchase of rights
pursuant thereto, or (e) any dividend in the form of stock, warrants, options or
other rights where the dividend stock or the stock issuable upon the exercise of
such warrants, options or other rights is the same stock as that on which the
dividend is being paid or ranks pari passu with or junior to such stock). Prior
to the termination of any such Extension Period, the Company may further extend
the interest payment period, provided that no Extension Period may exceed 20
consecutive quarterly periods or extend beyond the Stated Maturity of the
Securities. Upon the termination of any such Extension Period and the payment of
all amounts then due on any Interest Payment Date, the Company 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 Company shall give the Trustee notice of its election of such Extension
Period at least one Business Day prior to the record date for the related
interest payment.
Payment of the principal of and interest on this Security will
be made at the office or agency of the Paying Agent maintained for that purpose
in the United States, in such coin or currency of the United States of America
as at the time of payment is legal tender for
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<PAGE> 77
payment of public and private debts; provided, however, that at the option of
the Company, payment of interest may be made (i) by check mailed to the address
of the Person entitled thereto as such address shall appear in the Security
Register or (ii) by wire transfer in immediately available funds at such place
and to such account as may be designated by the Person entitled thereto as
specified in the Security Register.
The indebtedness evidenced by this Security is, to the extent
provided in the Indenture, subordinate and subject in right of payment to the
prior payment in full of all 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 behalf to take such
action as may be necessary or appropriate to effectuate the subordination so
provided and (c) appoints the Trustee his attorney-in-fact for any and all such
purposes. Each Holder hereof, by his acceptance hereof, waives all notice of the
acceptance of the subordination provisions contained herein and in the Indenture
by each holder of Indebtedness, whether now outstanding or hereafter incurred,
and waives reliance by each such holder upon said provisions.
In addition, each Holder hereof, by such Holder's acceptance
hereof, agrees to treat the Junior Subordinated Debentures evidenced hereby as
indebtedness of the Company for all United States tax purposes.
Reference is hereby made to the further provisions of the
Indenture summarized on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual signature,
this Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
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<PAGE> 78
IN WITNESS WHEREOF, Star Banc Corporation has caused this
instrument to be duly executed.
Dated: ________, __
STAR BANC CORPORATION
By:_________________________________________
Name:
Title:
-4-
<PAGE> 79
[Form of Reverse of Security]
This Security is one of a duly authorized issue of Securities
of Star Banc Corporation (the "Company"), designated as its Floating Rate Junior
Subordinated Debentures due 2027 (herein called the "Securities"), issued under
an Indenture, dated as of June 8, 1997 (herein called the "Indenture"), between
the Company and The First National Bank of Chicago, a national banking
association, as Trustee (herein called the "Trustee," which term includes any
successor trustee under the Indenture), to which Indenture and all indentures
supplemental thereto reference is hereby made for a statement of the respective
rights, limitations of rights, duties and immunities thereunder of the Trustee,
the Company and the Holders of the Securities, and of the terms upon which the
Securities are, and are to be, authenticated and delivered.
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
At any time on or after June 15, 2007, the Company shall have
the right, subject to the terms and conditions of Article Twelve of the
Indenture, to redeem this Security at the option of the Company, in whole or in
part, at a Redemption Price equal to the principal amount so redeemed plus
accrued but unpaid interest (including any Additional Interest) to the
Redemption Date.
If a Special Event as defined in Article Twelve of the
Indenture shall occur and be continuing, the Company shall have the right,
subject to the terms and conditions of Article Twelve of the Indenture, to
redeem this Security at the option of the Company, without premium or penalty,
in whole but not in part, at a Redemption Price equal to 100% of the principal
amount so redeemed plus accrued but unpaid interest (including any Additional
Interest) to the Redemption Date. Any redemption pursuant to this paragraph will
be made upon not less than 30 nor more than 60 days notice, at the Redemption
Price. If the Securities are only partially redeemed by the Company, the
Securities will be redeemed by lot (or such other method of selection as the
Trustee may customarily employ). 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.
If an Event of Default with respect to the Securities shall
occur and be continuing, the principal of the Securities may be declared due and
payable in the manner, with the effect and subject to the conditions provided in
the Indenture.
The Indenture contains provisions for satisfaction and
discharge or legal defeasance of the entire indebtedness of this Security and
for the defeasance of certain covenants under the Indenture at any time upon
compliance by the Company with certain conditions set forth in the Indenture.
The Indenture contains provisions permitting the Company and
the Trustee, with the consent of Holders of not less than a majority in
principal amount of the Outstanding Securities affected by such modification, to
modify the Indenture in a manner affecting the rights of the Holders of the
Securities; provided that no such modification may, without the
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<PAGE> 80
consent of the Holder of each Outstanding Security affected thereby, (i) change
the maturity of the principal of, or any installment of interest on, such
Security or reduce the principal amount thereof, or the rate of payment of
interest thereon, or extend the time of payment of interest thereon (except such
extensions as are provided for in such Security), or change the place of payment
where, or the coin or currency in which, such Security or interest thereon is
payable, or impair the right to institute suit for the enforcement of such
payment on or after the Maturity thereof (or, in the case of redemption, on or
after the Redemption Date), or modify the provisions of the Indenture with
respect to the subordination of the Securities in a manner adverse to the
Holders, (ii) reduce the percentage in principal amount of the Outstanding
Securities, the consent of whose Holders is required for such supplemental
Indenture or the consent of whose Holders is required for any waiver of
compliance with certain provisions of the Indenture or certain defaults
hereunder and their consequences provided for in the Indenture, or (iii) modify
any of the provisions of Section 513, Section 902 or Section 1008 of the
Indenture, except to increase any such percentage or to provide that certain
other provisions of the Indenture cannot be modified or waived without the
consent of the Holder of each Outstanding Security affected thereby, provided
that, so long as any of the Capital Securities remains outstanding, no such
amendment shall be made that adversely affects the holders of the Capital
Securities, and no termination of the Indenture shall occur, and no waiver of an
Event of Default or compliance with any covenant under the Indenture shall be
effective, without the prior consent of the holders of at least a majority of
the aggregate liquidation amount of the outstanding Capital Securities unless
and until the principal of and any premium on the Securities and all accrued and
unpaid interest thereon have been paid in full.
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
interest on this Security at the times, place and rate, and in the coin or
currency, herein prescribed.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is registrable in
the Security Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company in New York, New York, duly
endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar duly executed by, the
Holder hereof or his attorney duly authorized in writing, and thereupon one or
more new Securities, of authorized denominations and for the same aggregate
principal amount, will be issued to the designated transferee or transferees. No
service charge shall be made for any such registration of transfer or exchange,
but the Company may require payment of a sum sufficient to cover any tax or
other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
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<PAGE> 81
The Securities are issuable only in registered form without
coupons in denominations of $1,000 and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Securities are exchangeable for a like aggregate principal amount of Securities
of a different authorized denomination, as requested by the Holder surrendering
the same.
THE SECURITIES AND THE INDENTURE SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO
CONFLICTS OF LAWS PRINCIPLES THEREOF.
This is one of the Securities referred to in the
within-mentioned Indenture.
THE FIRST NATIONAL BANK OF CHICAGO,
as Trustee
By:_________________________________________
Authorized Signatory
Dated: ________ __, ____
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<PAGE> 82
In connection with any transfer of this Security occurring
prior to the date which is the earlier of (i) the date of the declaration by the
Commission of the effectiveness of a registration statement under the Securities
Act covering resales of this Security (which effectiveness shall not have been
suspended or terminated at the date of the transfer) and (ii) three years after
the later of the date of original issue and the last date on which the Company
or any affiliate of the Company was the owner of such Security (or any
predecessor thereto) (the "Resale Restriction Termination Date"), the
undersigned confirms that it has not utilized any general solicitation or
general advertising in connection with the transfer and that such transfer is
being made:
[Check One]
(1) ___ to the Company or a subsidiary thereof; or
(2) ___ pursuant to and in compliance with Rule 144A under the
Securities Act of 1933, as amended; or
(3) ___ to an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act of 1933,
as amended) that has furnished to the Trustee a signed letter
containing certain representations and agreements (the form of
which letter can be obtained from the Trustee); or
(4) ___ outside the United States to a "foreign person" in compliance
with Rule 904 of Regulation S under the Securities Act of
1933, as amended; or
(5) ___ pursuant to the exemption from registration provided by Rule
144 under the Securities Act of 1933, as amended; or
(6) ___ pursuant to an effective registration statement under the
Securities Act of 1933, as amended; or
(7) ___ pursuant to another available exemption from the registration
requirements of the Securities Act of 1933, as amended.
Unless one of the boxes is checked, the Trustee will refuse to register any of
the Securities evidenced by this certificate in the name of any person other
than the registered Holder thereof; provided, however, that if box (3), (4), (5)
or (7) is checked, the Company or the Trustee may require, prior to registering
any such transfer of the Securities, in its sole discretion, such written legal
opinions, certifications (including an investment letter in the case of box (3)
or (4)) and other information as the Trustee or the Company has reasonably
requested to confirm that such transfer is being made pursuant to an exemption
from, or in a transaction not subject to, the registration requirements of the
Securities Act of 1933, as amended.
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<PAGE> 83
If none of the foregoing boxes is checked, the Trustee or Registrar shall not be
obligated to register this Security in the name of any person other than the
Holder hereof unless and until the conditions to any such transfer of
registration set forth herein and in Section 315 of the Indenture shall have
been satisfied.
Dated: __________________ Signed:____________________________________________
(Sign exactly as name appears on the other
side of this Security)
Signature Guarantee:____________________
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing
this Security for its own account or an account with respect to which it
exercises sole investment discretion and that it and any such account is a
"qualified institutional buyer" within the meaning of Rule 144A under the
Securities Act and is aware that the sale to it is being made in reliance on
Rule 144A and acknowledges that it has received such information regarding the
Company as the undersigned has requested pursuant to Rule 144A or has determined
not to request such information and that it is aware that the transferor is
relying upon the undersigned's foregoing representations in order to claim the
exemption from registration provided by Rule 144A.
Dated: ________ _______________________________________________
NOTICE: To be executed by an executive officer
-9-
<PAGE> 1
Exhibit 4.2
RESTATED CERTIFICATE OF TRUST
OF
STAR CAPITAL TRUST I
THIS Restated Certificate of Trust of Star Capital Trust I (the
"Trust"), dated as of June 8, 1997, is being duly executed and filed by The
First National Bank of Chicago, First Chicago Delaware Inc., James D. Hogan,
Bruce Barnes and Jennie P. Carlson, as trustees, to restate the original
Certificate of Trust of the Trust, which was filed on June 6, 1997, with the
Secretary of State of the State of Delaware under the Delaware Business Trust
Act (12 Del. C. Section 3801. et seq.).
The Certificate of Trust is hereby restated in its entirety to read as
follows:
1. Name. The name of the business trust formed hereby is Star Capital
I.
2. Delaware Trustee. The name and business address of the trustee of
the Trust in the State of Delaware are First Chicago Delaware Inc., 300 King
Street, Wilmington, Delaware 19801.
3. Effective Date. This Certificate of Trust shall be effective upon
filing with the Secretary of State.
IN WITNESS WHEREOF, the undersigned, being the trustees of the Trust,
have executed this Restated Certificate of Trust as of the date first above
written.
THE FIRST NATIONAL BANK OF
CHICAGO, as trustee
By: /s/ John R. Prendiville
-----------------------
Name: John R. Prendiville
Title: Vice President
FIRST CHICAGO DELAWARE INC., as
trustee
By: /s/ John R. Prendiville
-----------------------
Name: John R. Prendiville
Title: Vice President
<PAGE> 1
EXHIBIT 4.3
AMENDED AND RESTATED DECLARATION OF TRUST
STAR CAPITAL I
Dated as of June 8, 1997
<PAGE> 2
TABLE OF CONTENTS
Page
ARTICLE 1
INTERPRETATION AND DEFINITIONS............ 1
Section 1.1 Interpretation and Definitions................................ 1
Affiliate.................................................................. 2
Authorized Officer......................................................... 2
Business Day............................................................... 2
Business Trust Act......................................................... 2
Capital Security........................................................... 2
Capital Security Certificate............................................... 2
Cedel .................................................................. 2
Certificate................................................................ 2
Certificate of Trust....................................................... 2
Closing Date............................................................... 2
Code .................................................................. 3
Commission................................................................. 3
Common Securities Holder................................................... 3
Common Security............................................................ 3
Common Security Certificate................................................ 3
Corporate Trust Office..................................................... 3
Covered Person............................................................. 3
Debenture Issuer........................................................... 3
Debenture Issuer Indemnified Person........................................ 3
Debenture Trustee.......................................................... 3
Debentures................................................................. 3
Delaware Trustee........................................................... 3
Depositary................................................................. 4
Distribution............................................................... 4
DTC .................................................................. 4
DWAC .................................................................. 4
Euroclear.................................................................. 4
Exchange Act............................................................... 4
Federal Reserve............................................................ 4
Fiduciary Indemnified Person............................................... 4
Fiscal Year................................................................ 4
Global Security............................................................ 4
Guarantee.................................................................. 4
Holder .................................................................. 4
Indemnified Person......................................................... 4
Indenture.................................................................. 4
Indenture Event of Default................................................. 5
Initial Purchasers......................................................... 5
Institutional Accredited Investor.......................................... 5
Investment Company......................................................... 5
Investment Company Act..................................................... 5
Investment Company Event................................................... 5
Legal Action............................................................... 5
List of Holders............................................................ 5
i
<PAGE> 3
Page
----
Majority in Liquidation Amount............................................... 5
New Capital Securities....................................................... 5
New Capital Security Certificate............................................. 5
Officers' Certificate........................................................ 5
Paying Agent................................................................. 6
Payment Amount............................................................... 6
Person .................................................................... 6
Private Placement Legend..................................................... 6
Property Account............................................................. 6
Property Trustee............................................................. 6
Pro Rata .................................................................... 6
Qualified Institutional Buyer................................................ 6
Quorum .................................................................... 6
Redemption Price............................................................. 6
Registration Rights Agreement................................................ 6
Regular Trustee.............................................................. 7
Regulation S................................................................. 7
Regulation S Global Security................................................. 7
Regulatory Capital Event..................................................... 7
Related Party................................................................ 7
Responsible Officer.......................................................... 7
Restricted Global Security................................................... 7
Restricted Period............................................................ 7
Restricted Security.......................................................... 7
Rule 144A.................................................................... 8
Rule 3a-5.................................................................... 8
Securities................................................................... 8
Securities Act............................................................... 8
Special Event................................................................ 8
Sponsor .................................................................... 8
Successor Delaware Trustee................................................... 8
Successor Entity............................................................. 8
Successor Property Trustee................................................... 8
Successor Security........................................................... 8
Super Majority............................................................... 8
Tax Event.................................................................... 8
10% in Liquidation Amount.................................................... 8
Transfer Restricted Securities............................................... 9
Transfer Restricted Securities Certificate................................... 9
Treasury Regulations......................................................... 9
Trust Enforcement Event...................................................... 9
Trust Indenture Act.......................................................... 9
Trustee" or "Trustees........................................................ 9
Trustees' Authorization Certificate.......................................... 9
ARTICLE 2
TRUST INDENTURE ACT................................... 9
Section 2.1 Trust Indenture Act; Application................................ 9
Section 2.2 Lists of Holders of Securities.................................. 10
ii
<PAGE> 4
Page
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Section 2.3 Reports by the Property Trustee................................ 10
Section 2.4 Periodic Reports to the Property Trustee....................... 10
Section 2.5 Evidence of Compliance with Conditions Precedent............... 11
Section 2.6 Trust Enforcement Events; Waiver............................... 11
Section 2.7 Trust Enforcement Event; Notice................................ 12
ARTICLE 3
ORGANIZATION...................................... 13
Section 3.1 Name and Organization.......................................... 13
Section 3.2 Office......................................................... 13
Section 3.3 Purpose........................................................ 13
Section 3.4 Authority...................................................... 14
Section 3.5 Title to Property of the Trust................................. 14
Section 3.6 Powers and Duties of the Regular Trustees...................... 14
Section 3.7 Prohibition of Actions by the Trust and the Trustees........... 20
Section 3.8 Powers and Duties of the Property Trustee...................... 21
Section 3.9 Certain Duties and Responsibilities of the Property Trustee.... 23
Section 3.10 Certain Rights of Property Trustee............................ 25
Section 3.11 Delaware Trustee.............................................. 28
Section 3.12 Execution of Documents........................................ 28
Section 3.13 Not Responsible for Recitals or Issuance of Securities........ 28
Section 3.14 Duration of Trust............................................. 28
Section 3.15 Mergers....................................................... 28
Section 3.16 Property Trustee May File Proofs of Claim..................... 30
ARTICLE 4
SPONSOR......................................... 31
Section 4.1 Responsibilities of the Sponsor................................ 31
Section 4.2 Compensation, Indemnification and Expenses of the Trustee...... 32
ARTICLE 5
TRUST COMMON SECURITIES HOLDER............................. 32
Section 5.1 Debenture Issuer's Purchases of Common Securities.............. 32
Section 5.2 Covenants of the Common Securities Holder...................... 33
ARTICLE 6
TRUSTEES........................................ 33
Section 6.1 Number of Trustees............................................. 33
Section 6.2 Delaware Trustee............................................... 33
Section 6.3 Property Trustee; Eligibility.................................. 34
Section 6.4 Qualifications of Regular Trustees and Delaware Trustee
Generally.................................................... 35
Section 6.5 Initial Regular Trustees....................................... 35
Section 6.6 Appointment, Removal and Resignation of Trustees............... 35
Section 6.7 Vacancies among Trustees....................................... 36
Section 6.8 Effect of Vacancies............................................ 36
Section 6.9 Delegation of Power............................................ 37
iii
<PAGE> 5
Page
----
Section 6.10 Merger, Conversion, Consolidation or Succession to Business.... 37
ARTICLE 7
THE SECURITIES.............................. 37
Section 7.1 General Provisions Regarding Securities......................... 37
Section 7.2 Distributions................................................... 40
Section 7.3 Redemption of Securities........................................ 40
Section 7.4 Redemption Procedures........................................... 41
Section 7.5 Voting Rights of Capital Securities............................. 43
Section 7.6 Voting Rights of Common Securities.............................. 44
Section 7.7 Paying Agent.................................................... 46
Section 7.8 Transfer of Securities.......................................... 46
Section 7.9 Mutilated, Destroyed, Lost or Stolen Certificates............... 47
Section 7.10 Persons Deemed Security Holders................................ 48
Section 7.11 Global Securities.............................................. 48
Section 7.12 Restrictive Legend............................................. 50
Section 7.13 Special Transfer Provisions.................................... 52
ARTICLE 8
DISSOLUTION AND TERMINATION OF TRUST................... 55
Section 8.1 Dissolution and Termination of Trust............................ 55
Section 8.2 Liquidation Distribution Upon Termination and Dissolution of
the Trust................................................... 56
ARTICLE 9
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS......................... 57
Section 9.1 Liability....................................................... 57
Section 9.2 Exculpation..................................................... 57
Section 9.3 Fiduciary Duty.................................................. 57
Section 9.4 Indemnification................................................. 58
Section 9.5 Outside Businesses.............................................. 61
ARTICLE 10
ACCOUNTING................................ 61
Section 10.1 Fiscal Year.................................................... 61
Section 10.2 Certain Accounting Matters..................................... 61
Section 10.3 Banking........................................................ 62
Section 10.4 Withholding.................................................... 62
ARTICLE 11
AMENDMENTS AND MEETINGS......................... 63
Section 11.1 Amendments..................................................... 63
Section 11.2 Meetings of the Holders of Securities; Action by Written
Consent.................................................... 65
iv
<PAGE> 6
Page
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ARTICLE 12
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE........................... 67
Section 12.1 Representations and Warranties of the Property Trustee........ 67
Section 12.2 Representations and Warranties of the Delaware Trustee........ 67
ARTICLE 13
MISCELLANEOUS............................. 69
Section 13.1 Notices....................................................... 69
Section 13.2 Governing Law................................................. 70
Section 13.3 Intention of the Parties...................................... 70
Section 13.4 Headings...................................................... 70
Section 13.5 Successors and Assigns........................................ 70
Section 13.6 Partial Enforceability........................................ 70
Section 13.7 Counterparts.................................................. 70
Section 13.8 Undertaking for Costs......................................... 71
v
<PAGE> 7
AMENDED AND RESTATED DECLARATION OF TRUST
THIS AMENDED AND RESTATED DECLARATION OF TRUST ("Declaration")
dated as of June 8, 1997 between STAR BANC CORPORATION, an Ohio corporation, as
Sponsor, and James D. Hogan, Bruce E. Barnes and Jennie P. Carlson, as the
initial Regular Trustees, THE FIRST NATIONAL BANK OF CHICAGO, as the initial
Property Trustee and FIRST CHICAGO DELAWARE INC., as the initial Delaware
Trustee, not in their individual capacities but solely as Trustees, and the
holders, from time to time, of undivided beneficial ownership interests in the
assets of the Trust to be issued pursuant to this Declaration.
WHEREAS, the Trustees and the Sponsor established Star Capital
I (the "Trust"), a business trust under the Business Trust Act (as defined,
together with other capitalized terms, herein) pursuant to a Declaration of
Trust dated as of June 5, 1997 (the "Original Declaration") and a Certificate of
Trust (the "Certificate of Trust") filed with the Secretary of State of the
State of Delaware on June 6, 1997; and
WHEREAS, the sole purpose of the Trust shall be to issue and
sell, in one or more issuances and sales, certain securities representing
undivided beneficial ownership interests in the assets of the Trust, to invest
the proceeds from such sales in the Debentures issued by the Debenture Issuer
and to engage in only those activities necessary or incidental thereto; and
WHEREAS, all of the Trustees and the Sponsor, by this
Declaration, amend and restate each and every term and provision of the Original
Declaration.
NOW, THEREFORE, it being the intention of the parties hereto
that the Trust constitute a business trust under the Business Trust Act, the
Trustees hereby declare that all assets contributed to the Trust be held in
trust for the benefit of the Holders, from time to time, of the Securities
representing undivided beneficial ownership interests in the assets of the Trust
issued hereunder, subject to the provisions of this Declaration.
ARTICLE 1
INTERPRETATION AND DEFINITIONS
Section 1.1 Interpretation and 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;
<PAGE> 8
2
(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 are to Articles and Sections of 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 and a reference to any masculine form of a term shall include the feminine
form of a term, as applicable.
"Affiliate" has the same meaning as given to that term in Rule
405 of the Securities Act or any successor rule thereunder.
"Authorized Officer" of a Person means the Chairman of the
Board, a Vice Chairman of the Board, the Chief Executive Officer, the President,
a Vice President, the principal financial officer, the Treasurer, an Assistant
Treasurer, the Secretary or an Assistant Secretary of the Company.
"Business Day" means any day other than a Saturday or Sunday
or a day on which banking institutions in New York City, Chicago, Illinois or
Cincinnati, Ohio, are authorized or required by law or executive order to remain
closed or a day on which the Corporate Trust Office of the Property Trustee is
closed for business.
"Business Trust Act" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code Section 3801 et seq., as it may be amended from time
to time, or any successor legislation.
"Capital Security" has the meaning specified in Section 7.1.
"Capital Security Certificate" means a certificate
representing a Capital Security.
"Cedel" means Cedel, S.A.
"Certificate" means a Common Security Certificate or a Capital
Security Certificate.
"Certificate of Trust" has the meaning specified in the
recitals hereto.
"Closing Date" means June 8, 1997 or such subsequent date or
dates on which the Capital Securities are issued and sold.
<PAGE> 9
3
"Code" means the Internal Revenue Code of 1986, as amended
from time to time, or any successor legislation. A reference to a specific
section of the Code refers not only to such specific section but also to any
corresponding provision of any federal tax statute enacted after the date of
this Declaration, as such specific section or corresponding provision is in
effect on the date of application of the provisions of this Declaration
containing such reference.
"Commission" means the Securities and Exchange Commission.
"Common Securities Holder" means Star Banc Corporation in its
capacity as purchaser and holder of all of the Common Securities issued or to be
issued by the Trust.
"Common Security" has the meaning specified in Section 7.1.
"Common Security Certificate" means a definitive certificate
in fully registered form representing a Common Security.
"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 Declaration is located at One First National Plaza, Suite
0126, Chicago, Illinois 60670-0126, Attention: Corporate Trust Services
Division.
"Covered Person" means (a) any officer, director, trustee,
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 Star Banc Corporation in its capacity
as issuer, in one or more issuances, of the Debentures under the Indenture.
"Debenture Issuer Indemnified Person" means (a) any Regular
Trustee; (b) any Affiliate of any Regular Trustee; (c) any officers, directors,
shareholders, members, partners, employees, representatives or agents of any
Regular Trustee or any Affiliate thereof; or (d) any officer, employee or agent
of the Trust or its Affiliates, but does not include any Fiduciary Indemnified
Person.
"Debenture Trustee" means The First National Bank of Chicago,
in its capacity as trustee under the Indenture until a successor is appointed
thereunder, and thereafter means such successor trustee.
"Debentures" means the Securities (as defined in the
Indenture) to be issued, in one or more issuances, by the Debenture Issuer and
to be held by the Property Trustee.
"Delaware Trustee" has the meaning set forth in Section 6.2.
<PAGE> 10
4
"Depositary" means, with respect to Securities issuable in
whole or in part in the form of one or more Global Securities, a clearing agency
registered under the Exchange Act that is designated to act as Depositary for
such Securities.
"Distribution" means a distribution payable to Holders of
Securities in accordance with Section 7.2.
"DTC" means The Depository Trust Company, the initial
Depositary.
"DWAC" means Deposit and Withdrawal At Custodian Service.
"Euroclear" means Morgan Guaranty Trust Company of New York,
Brussels office, as operator of the Euroclear System.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, or any successor legislation.
"Federal Reserve" means the Board of Governors of the Federal
Reserve System.
"Fiduciary Indemnified Person" has the meaning set forth in
Section 9.4(6).
"Fiscal Year" has the meaning set forth in Section 10.1.
"Global Security" has the meaning set forth in Section 7.11.
"Guarantee" means the guarantee agreement of the Sponsor in
respect of the Capital Securities and the Common Securities.
"Holder" means a Person in whose name a Certificate
representing a Security is registered, such Person being a beneficial owner
within the meaning of the Business Trust Act; provided, however, that in
determining whether the Holders of the requisite liquidation amount of Capital
Securities have voted on any matter provided for in this Declaration, then for
the purpose of such determination only (and not for any other purpose
hereunder), if the Capital Securities remain in the form of one or more Global
Securities, the term "Holders" shall mean the holder of the Global Security
acting at the direction of the beneficial owners of the Capital Securities.
"Indemnified Person" means a Debenture Issuer Indemnified
Person or a Fiduciary Indemnified Person.
"Indenture" means the Indenture dated as of June 8, 1997,
between the Debenture Issuer and the Debenture Trustee, and any indenture
supplemental thereto pursuant to which the Debentures are to be issued.
<PAGE> 11
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"Indenture Event of Default" means an "Event of Default" as
defined in the Indenture.
"Initial Purchasers" means Credit Suisse First Boston
Corporation, Morgan Stanley & Co. Incorporated and Salomon Brothers Inc.
"Institutional Accredited Investor" means an institution that
is an "accredited investor" as the term is defined in Rule 501(a)(1), (2), (3)
or (7) under the Securities Act.
"Investment Company" means an investment company as defined in
the Investment Company Act and the regulations promulgated thereunder.
"Investment Company Act" means the Investment Company Act of
1940, as amended from time to time, or any successor legislation.
"Investment Company Event" means the receipt by the Trust of
an opinion of counsel, rendered by a law firm having a recognized national
securities practice, to the effect that, as a result of the occurrence of a
change in law or regulation or a change in interpretation or application of law
or regulation by any legislative body, court, governmental agency or regulatory
authority (a "Change in 1940 Act Law"), the Trust is or will be considered an
"investment company" that is required to be registered under the Investment
Company Act, which Change in 1940 Act Law becomes effective on or after the
Closing Date.
"Legal Action" has the meaning set forth in Section 3.6(g).
"List of Holders" has the meaning specified in Section 2.2(a).
"Majority in Liquidation Amount" means, except as provided in
the terms of the Capital Securities or by the Trust Indenture Act, Holder(s) of
outstanding 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 accrued and
unpaid Distributions to the date upon which the voting percentages are
determined) of all outstanding Securities of the relevant class.
"New Capital Securities" has the meaning specified in Section
7.1.
"New Capital Security Certificate" has the meaning specified
in Section 7.1.
"Officers' Certificate" means, with respect to any Person
(other than Regular Trustees who are natural persons), a certificate signed by
two Authorized Officers of such Person on behalf of such Person. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Declaration shall include:
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(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
(c) a statement as to whether, in the opinion of each such
officer and on behalf of such Person, such condition or covenant has been
complied with; provided, that the term "Officers' Certificate", when used with
reference to Regular Trustees who are natural persons shall mean a certificate
signed by two of the Regular Trustees which otherwise satisfies the foregoing
requirements.
"Paying Agent" has the meaning specified in Section 3.8(h).
"Payment Amount" has the meaning specified in Section 7.2(a).
"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.
"Private Placement Legend" has the meaning specified in
Section 7.12.
"Property Account" has the meaning specified in Section
3.8(c).
"Property Trustee" means the Trustee meeting the eligibility
requirements set forth in Section 6.3.
"Pro Rata" means 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.
"Qualified Institutional Buyer" or "QIB" has the meaning
specified in Rule 144A under the Securities Act.
"Quorum" means a majority of the Regular Trustees or, if there
are only two Regular Trustees, both of them.
"Redemption Price" has the meaning specified in Section
7.3(a).
"Registration Rights Agreement" means the Registration Rights
Agreement dated the date hereof between the Debenture Issuer, the Trust and the
Initial Purchasers for the benefit of themselves and the Holders of the Capital
Securities issued by the Trust as of
<PAGE> 13
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the date hereof, as the same may be amended from time to time in accordance with
the terms thereof.
"Regular Trustee" means any Trustee other than the Property
Trustee and the Delaware Trustee.
"Regulation S" means Regulation S under the Securities Act and
any successor regulation thereto.
"Regulation S Global Security" means any Global Security or
Securities evidencing Securities that are to be traded pursuant to Regulation S.
"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 or (b) any official or administrative
pronouncement or action or judicial decision interpreting or applying such laws
or regulations which amendment or change is effective or such pronouncement or
action 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 1 capital (or its then
equivalent); provided, however, that the distribution of the Debentures to the
Holders of the Securities in connection with the liquidation of the Trust by the
Debenture Issuer shall not in and of itself constitute a Regulatory Capital
Event unless such liquidation shall have occurred in connection with a Tax Event
or an Investment Company Event.
"Related Party" means, with respect to the Sponsor, any direct
or wholly owned subsidiary of the Sponsor or any 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, the secretary, any
assistant secretary, the treasurer, 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.
"Restricted Global Security" means any Global Security or
Securities evidencing Securities that are to be sold pursuant to Rule 144A.
"Restricted Period" shall have the meaning specified in
Section 7.13(g).
"Restricted Security" has the meaning assigned to such term in
Rule 144(a)(3) under the Securities Act.
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"Rule 144A" means Rule 144A under the Securities Act.
"Rule 3a-5" means Rule 3a-5 under the Investment Company Act
or any successor rule thereunder.
"Securities" means the Common Securities and the Capital
Securities (whether issued at the initial Closing or any subsequent Closing
Date).
"Securities Act" means the Securities Act of 1933, as amended
from time to time, or any successor legislation.
"Special Event" means a Tax Event, a Regulatory Capital Event
or an Investment Company Event.
"Sponsor" means Star Banc Corporation, an Ohio corporation, or
any successor entity in a merger, consolidation or amalgamation, in its capacity
as sponsor of the Trust.
"Successor Delaware Trustee" has the meaning specified in
Section 6.6(b).
"Successor Entity" has the meaning specified in Section
3.15(b)(i).
"Successor Property Trustee" has the meaning specified in
Section 6.6(b).
"Successor Security" has the meaning specified in Section
3.15(b)(i)b.
"Super Majority" has the meaning set forth in Section
2.6(a)(ii).
"Tax Event" means the receipt by the Debenture Issuer of an
opinion of counsel, rendered by a law firm having a national tax practice, to
the effect that, as a result of any amendment to, change in or announced
proposed change in the laws (or any regulations thereunder) of the United States
or any political subdivision or taxing authority thereof or therein, or as a
result of any official or administrative pronouncement or action or judicial
decision interpreting or applying such laws or regulations, which amendment or
change is adopted or which proposed change, pronouncement or decision is
announced or which action is taken on or after the date of original issuance of
the Capital Securities, 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 the
United States federal income tax with respect to income received or accrued on
the Debentures, (ii) interest payable by the Debenture Issuer on such 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, except as provided in the
terms of the Capital Securities or by the Trust Indenture Act, Holder(s) of
outstanding Securities, voting together as a single class, or, as the context
may require, Holders of outstanding Capital
<PAGE> 15
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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.
"Transfer Restricted Securities" has the meaning specified in
Section 7.1.
"Transfer Restricted Securities Certificate" has the meaning
specified in Section 7.1.
"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).
"Trust Enforcement Event" in respect of the Securities means
an Indenture Event of Default has occurred and is continuing in respect of the
Debentures.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended from time to time, or any successor legislation.
"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.
"Trustees' Authorization Certificate" means a written
certificate signed by two of the Regular Trustees for the purpose of
establishing the terms and form of the Capital Securities and the Common
Securities as determined by the Regular Trustees.
ARTICLE 2
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.
<PAGE> 16
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(c) If and to the extent that any provision of this
Declaration conflicts with the duties imposed by Sections 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 Trust's classification as a grantor trust for
United States Federal income tax purposes and shall not affect the nature of the
Securities as equity securities representing undivided beneficial ownership
interests in the assets of the Trust.
Section 2.2 Lists of Holders of Securities.
(a) Each of the Sponsor and the Regular Trustees on behalf of
the Trust shall provide the Property Trustee with 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"), (i) not later than June 30 and
December 31 of each year and current as of such date, and (ii) at any other
time, within 30 days of receipt by the Trust of a written request from the
Property Trustee for a List of Holders as of a date no more than 15 days before
such List of Holders is given to the Property Trustee; provided that neither the
Sponsor nor the Regular Trustees on behalf of 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 Regular Trustees on behalf of the Trust. 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, and shall be entitled to the benefits of, Sections 311(a), 311(b) and
312(b) of the Trust Indenture Act.
Section 2.3 Reports by the Property Trustee.
Within 60 days after May 15 of each year (commencing in the
year of the issuance of the Capital Securities), 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 the Property Trustee.
Each of the Sponsor and the Regular Trustees on behalf of the
Trust shall provide to the Property Trustee such documents, reports and
information as required by Section 314 of the Trust Indenture Act (if any) and
the compliance certificate required by Section 314 of the Trust Indenture Act in
the form, in the manner and at the times required by Section 314 of the Trust
Indenture Act.
<PAGE> 17
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Section 2.5 Evidence of Compliance with Conditions Precedent.
Each of the Sponsor and the Regular Trustees on behalf of the
Trust shall provide to the Property Trustee such evidence of compliance with any
conditions precedent, if any, provided for in this 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) may be given in the form of an Officers' Certificate.
Section 2.6 Trust Enforcement Events; Waiver.
(a) The Holders of a Majority in Liquidation Amount of the
Capital Securities may, by vote or written consent, on behalf of the Holders of
all of the Capital Securities, waive any past Trust Enforcement Event in respect
of the Capital Securities and its consequences, provided that, if the underlying
Indenture Event of Default:
(i) is not waivable under the Indenture, the
Trust Enforcement Event under the
Declaration shall also not be waivable; or
(ii) requires the consent or vote of greater than
a majority in principal amount of the
holders of the Debentures (a "Super
Majority") to be waived under the Indenture,
the Trust Enforcement Event under the
Declaration may only be waived by the vote
or written consent of the Holders of at
least the proportion in 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 Trust Enforcement
Event with respect to the Capital Securities arising therefrom shall be deemed
to have been cured, for every purpose of this Declaration and the Capital
Securities, but no such waiver shall extend to any subsequent or other Trust
Enforcement Event with respect to the Capital Securities or impair any right
consequent thereon. Any waiver by the Holders of the Capital Securities of a
Trust Enforcement Event with respect to the Capital Securities shall also be
deemed to constitute a waiver by the Holders of the Common Securities of any
such Trust Enforcement Event 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 or written consent, on behalf of the Holders of
all of the Common Securities, waive any past Trust Enforcement Event in respect
of the Common Securities and its consequences, provided that, if the underlying
Indenture Event of Default:
<PAGE> 18
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(i) is not waivable under the Indenture, except
where the Holders of the Common Securities
are deemed to have waived such Trust
Enforcement Event under the Declaration as
provided below in this Section 2.6(b), the
Trust Enforcement Event under the
Declaration shall also not be waivable; or
(ii) requires the consent or vote of a Super
Majority to be waived under the Indenture,
except where the Holders of the Common
Securities are deemed to have waived such
Trust Enforcement Event under the
Declaration as provided below in this
Section 2.6(b), the Trust Enforcement Event
under the Declaration may only be waived by
the vote or written consent of the Holders
of at least the proportion in 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 Trust Enforcement Event and all Trust Enforcement
Events with respect to the Common Securities and the consequences thereof until
all Trust Enforcement Events with respect to the Capital Securities have been
cured, waived or otherwise eliminated, and until such Trust Enforcement Events
with respect to the Capital Securities 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 Trust Enforcement Event 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 Trust Enforcement Event with respect to the Common Securities or impair
any right consequent thereon.
(c) A waiver of an Indenture Event of Default by the Property
Trustee at the direction of the Holders of the Capital Securities constitutes a
waiver of the corresponding Trust Enforcement Event with respect to the Capital
Securities 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 Trust Enforcement Event; Notice.
(a) The Property Trustee shall, within 90 days after the
occurrence of a Trust Enforcement Event actually known to a Responsible Officer
of the Property Trustee, transmit
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by mail, first class postage prepaid, to the Holders of the Securities, notices
of all such defaults with respect to the Securities, 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 Indenture Event of
Default, 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 501(1) and 501(2)
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
this Declaration shall have actual
knowledge.
ARTICLE 3
ORGANIZATION
Section 3.1 Name and Organization.
The Trust hereby continued is named "Star Capital I" as such
name may be modified from time to time by the Regular 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 Regular
Trustees.
Section 3.2 Office.
The address of the principal executive office of the Trust is
c/o Star Banc Corporation, Attn: General Counsel, 425 Walnut Street, Cincinnati,
Ohio 45202. On 10 Business Days' written notice to the Holders of Securities,
the Regular Trustees may designate another principal office.
Section 3.3 Purpose.
The exclusive purposes and functions of the Trust are (a) to
issue and sell, in one or more issuances and sales, the Securities and use the
gross proceeds from such sale to acquire the Debentures issued or to be issued
by the Debenture Issuer, and (b) except as otherwise limited herein, to engage
in only those other activities necessary or incidental thereto. The Trust shall
not borrow money, issue debt or reinvest proceeds derived from
<PAGE> 20
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investments, mortgage, pledge any of its assets or otherwise undertake (or
permit to be undertaken) any activity that would cause the Trust not to be
classified as a grantor trust for United States federal income tax purposes.
By the acceptance of this Trust, none of the Trustees, the
Sponsor, the Holders of the Capital Securities or Common Securities will take
any position which is contrary to the classification of the Trust as a grantor
trust for United States federal income tax purposes.
Section 3.4 Authority.
Subject to the limitations provided in this Declaration and to
the specific duties of the Property Trustee, the Regular Trustees shall have
exclusive authority to carry out the purposes of the Trust. An action taken by
the Regular 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. Except as expressly set forth in this Declaration and except if a
meeting of the Regular Trustees is called with respect to any matter over which
the Regular Trustees have power to act, any power of the Regular Trustees may be
exercised by, or with the consent of, any one such Regular Trustee.
Section 3.5 Title to Property of the Trust.
Except as provided in Section 3.8 with respect to the
Debentures and the Property 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 ownership interest in the assets
of the Trust.
Section 3.6 Powers and Duties of the Regular Trustees.
The Regular Trustees shall have the power, duty and authority
to cause the Trust to engage in the following activities, subject to the
limitations and restrictions of applicable laws:
(a) to establish the terms and form of the Capital Securities
and the Common Securities in the manner specified in Section 7.1 and issue and
sell, in one or more issuances and sales, the Capital Securities and the Common
Securities in accordance with this Declaration; provided, however, that the
Trust may issue no more than two series of Capital Securities (which will
consist exclusively of the Transfer Restricted Securities and the New Capital
Securities) and, provided further, that there shall be no interests in the Trust
other than the Securities, and no more than one series of Common Securities;
<PAGE> 21
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(b) in connection with the issuances and sales of the Capital
Securities, at the direction of the Sponsor, to:
(i) execute and file with the Commission one or
more registration statements on the
applicable forms prepared by the Sponsor,
including any amendments thereto, pertaining
to the Capital Securities, the Guarantee and
the Debentures;
(ii) if deemed necessary or desirable by the
Sponsor, execute and file an application,
prepared by the Sponsor, to the New York
Stock Exchange, Inc. or any other national
stock exchange, the NASDAQ National Market
or the Private Offerings, Resales and
Trading through Automated Linkages
("PORTAL") Market for listing of any Capital
Securities, the Guarantee and the
Debentures;
(iii) if deemed necessary or desirable by the
Sponsor, 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, the
Guarantee and the Debentures under Section
12(b) of the Exchange Act;
(iv) 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;
(v) execute and enter into one or more purchase
agreements and other related agreements each
providing for the sale of the Capital
Securities to the Initial Purchasers related
thereto; and
(vi) execute and enter into one or more
Registration Rights Agreements.
(c) to acquire Debentures with the proceeds of each sale of
the Capital Securities and the Common Securities; provided, however, that the
Regular 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 the Common Securities;
(d) to give the Sponsor and the Property Trustee prompt
written notice of the occurrence of a Special Event; provided that the Regular
Trustees shall consult with the Sponsor and the Property Trustee before taking
or refraining from taking any action in relation to any such Special Event;
(e) 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
<PAGE> 22
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Section 316(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;
(f) to take all actions and perform such duties as may be
required of the Regular Trustees pursuant to the terms of this Declaration and
the Securities;
(g) 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;
(h) to employ or otherwise engage employees and agents (who
may be designated as officers with titles) and managers, contractors, advisors
and consultants to conduct only those services that the Regular Trustees have
authority to conduct directly, and to and pay reasonable compensation for such
services;
(i) to cause the Trust to comply with the Trust's obligations
under the Trust Indenture Act;
(j) 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 Regular Trustee;
(k) to incur expenses that are necessary or incidental to
carry out any of the purposes of the Trust;
(l) to act as, or appoint another Person to act as, registrar
and transfer agent for the Securities;
(m) to give prompt written notice to the 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 Debentures as authorized by the Indenture;
(n) 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 and the Holders of the Common Securities or to enable the Trust to
effect the purposes for which the Trust was created;
(o) to take any action, not inconsistent with applicable law,
that the Regular Trustees determine in their discretion to be necessary or
desirable in carrying out the purposes and functions of the Trust as set out in
Section 3.3 or the activities of the Trust as set out in this Section 3.6,
including, but not limited to:
<PAGE> 23
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(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 as a grantor trust
for United States federal income tax purposes; 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.
(p) 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 Regular Trustees, on behalf of
the Trust; and
(q) 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.
No provision of this Declaration shall be construed to
relieve a Regular Trustee from liability for his own negligent action, his own
negligent failure to act, or his own willful misconduct, except that:
(i) prior to the occurrence of a Trust Enforcement Event
and after the curing or waiving of such Trust
Enforcement Event that may have occurred:
(A) the duties and obligations of the Regular
Trustees shall be determined solely by the
express provisions of this Declaration and
the Regular Trustee shall not be liable
except for the performance of such duties
and obligations as are specifically set
forth in this Declaration, and no implied
covenants or obligations shall be read into
this Declaration against the Regular
Trustees; and
(B) in the absence of bad faith on the part of a
Regular Trustee, such Regular 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 such
Regular Trustee and conforming to the
requirements of this Declaration; but in the
case of any such certificates or opinions
that by any provision hereof are
specifically required to be furnished to
such Regular Trustee, such Regular Trustee
shall be under a duty to examine the same to
determine whether or not they substantially
conform to the requirements of this
Declaration;
<PAGE> 24
18
(ii) a Regular Trustee shall not be liable for
any error of judgment made in good faith
unless it shall be proved that such Regular
Trustee was negligent in ascertaining the
pertinent facts;
(iii) no provision of this Declaration shall
require a Regular Trustee to expend or risk
his own funds or otherwise incur personal
financial liability in the performance of
any of his duties or in the exercise of any
of his rights or powers, if he shall have
reasonable grounds for believing that the
repayment of such funds or liability is not
reasonably assured to him under the terms of
this Declaration or indemnity reasonably
satisfactory to such Regular Trustee against
such risk or liability is not reasonably
assured to him;
(iv) a Regular Trustee shall not be responsible
for monitoring the compliance by the
Property Trustee or the Sponsor with their
respective duties under this Declaration,
nor shall such Regular Trustee be liable for
any default or misconduct of the Property
Trustee or the Sponsor;
(v) a Regular 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 him to be genuine and to have
been signed, sent or presented by the proper
party or parties;
(vi) a Regular Trustee shall have no duty (other
than as set forth in this Declaration) 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;
(vii) the Regular Trustees may consult with
counsel or other experts of their 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
them 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 Regular Trustees shall
have the right at any time to seek
instructions concerning the administration
of this Declaration from any court of
competent jurisdiction;
(viii) the Regular Trustees shall be under no
obligation to exercise any of the rights or
powers vested in them by this Declaration at
the request or direction of any Holder,
unless such Holder shall have provided to
the Regular Trustees security and indemnity,
reasonably satisfactory to the
<PAGE> 25
19
Regular Trustees, against the costs, expenses
(including attorneys' fees and expenses) and
liabilities that might be incurred by them in
complying with such request or direction, including
such reasonable advances as may be requested by them;
(ix) a Regular 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 he, in
his discretion, may make such further inquiry or
investigation into such facts or matters as he may
see fit;
(x) a Regular 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 such Regular Trustee shall
not be responsible for any misconduct or negligence
on the part of any agent or attorney appointed with
due care by him hereunder;
(xi) any action taken by a Regular Trustee or his agents
hereunder shall bind the Trust and the Holders of the
Securities, and the signature of such Regular Trustee
or his 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 such
Regular Trustee to so act or as to his compliance
with any of the terms and provisions of this
Declaration, both of which shall be conclusively
evidenced by such Regular Trustee's or his agent's
taking such action;
(xii) except as otherwise expressly provided by this
Declaration, a Regular Trustee shall not be under any
obligation to take any action that is discretionary
under the provisions of this Declaration; and
(xiii) a Regular 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 Declaration.
The Regular Trustees shall 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 subject to the limitations and
restrictions of applicable law, and the Regular Trustees shall have no power to,
and shall not, take any action that is inconsistent with the purposes and
functions of the Trust set forth in Section 3.3 or that is inconsistent with or
in contravention of any applicable law.
Subject to this Section 3.6, the Regular Trustees shall have
none of the powers or the authority of the Property Trustee set forth in Section
3.8.
<PAGE> 26
20
Any expenses incurred by the Regular Trustees pursuant to this
Section shall be reimbursed by the Debenture Issuer.
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 cause the Trust not to, engage in any activity other
than as required or authorized by this Declaration. In particular, the Trust
shall not and the Trustees (including the Property Trustee) shall cause the
Trust not to:
(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 the Debentures (and any
interest or proceeds received thereon) and the
Guarantee (and the proceeds received thereon or with
respect thereto);
(iii) possess Trust property for other than a Trust
purpose;
(iv) make any loans or incur any indebtedness;
(v) possess any power or otherwise act in such a way as
to vary the Trust assets;
(vi) possess any power or otherwise act in such a way as
to vary the terms of the Securities in any way
whatsoever (except to the extent expressly authorized
in this Declaration or by the terms of the
Securities);
(vii) issue any securities or other evidences of beneficial
ownership of, or beneficial interest in, the Trust
other than the Securities; or
(viii) other than as provided in this Declaration or by the
terms of the Securities, (A) direct the time, method
and place of 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, in each case, the Trust shall have received
(x) the prior approval of the Majority in Liquidation
Amount of the Capital Securities; provided, however,
that where a consent or action under the Indenture
would require the consent or act of the holders of
more than a majority of the aggregate liquidation
amount of Debentures affected thereby, only the
Holders of the percentage of the aggregate stated
liquidation amount of the Capital
<PAGE> 27
21
Securities which is at least equal to the percentage
required under the Indenture may direct the Property
Trustee to give such consent to take such action and,
in the case of any amendment, modification or
termination under clause (D) only, (y) an opinion of
counsel to the effect that such modification will not
cause more than an insubstantial risk that the Trust
will be deemed an Investment Company required to be
registered under the Investment Company Act, or the
Trust will not be classified as a grantor trust for
United States Federal income tax purposes; or
(ix) take any action inconsistent with the status of the
Trust as a grantor trust for United States federal
income tax purposes; or
(x) revoke any action previously authorized or approved
by a vote of the Holders of the Capital Securities
except pursuant to a subsequent vote of the Holders
of the Capital Securities.
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 Trust and 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
6.6. 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 Regular 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 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 Account and make
payments to the Holders of the Capital
Securities and Holders of the Common
Securities from the Property Account in
accordance with Section 7.2. Funds in the
Property Account shall be held uninvested
until disbursed in accordance with this
Declaration. The Property 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
<PAGE> 28
22
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 Regular Trustees in accordance with
the terms of the Securities, engage in such
ministerial activities as so directed and as
shall be necessary or appropriate to effect
the distribution of the Debentures to
Holders of Securities upon the occurrence of
a Special Event.
(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 this Declaration and the Securities.
(e) The Property Trustee shall take any Legal Action which
arises out of or in connection with a Trust Enforcement Event 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; provided, however, that if a Trust Enforcement Event has occurred and is
continuing and such event is attributable to the failure of the Debenture Issuer
to pay interest or principal (or premium, if any) on the Debentures on the date
such interest or principal (or premium, if any) 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
Security 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; provided,
however, that no Holder of the Common Securities may exercise any such right of
subrogation so long as a Trust Enforcement Event with respect to the Capital
Securities has occurred and is continuing.
(f) The Property Trustee shall continue to serve as a
Trustee until 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 6.6.
(g) Subject to such limitations as are necessary to insure
compliance with Section 3.3, the Property Trustee shall have the legal power to
exercise all of the rights,
<PAGE> 29
23
powers and privileges of a holder of Debentures under the Indenture and, if a
Trust Enforcement Event actually known to a Responsible Officer of the Property
Trustee occurs and is continuing, the Property Trustee shall, for the 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 may authorize one or more Persons
(each, a "Paying Agent") 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 Paying Agent may be removed by the Property Trustee at any time and a
successor Paying Agent or additional Paying Agents may be appointed at any time
by the Property Trustee. In the event that any of the Capital Securities are not
in the form of Global Securities, the Property Trustee will act as Paying Agent
and may designate an additional or substitute Paying Agent at any time.
(i) Subject to this Section 3.8, the Property Trustee shall
have none of the duties, liabilities, powers or the authority of the Regular
Trustees set forth in Section 3.6.
The Property Trustee shall 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 subject to the limitations and
restrictions of applicable law, and the Property Trustee shall have no power to,
and 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 Trust
Enforcement Event and after the curing of all Trust Enforcement Events that may
have occurred, shall undertake to perform only such duties as are specifically
set forth in this Declaration and no implied covenants shall be read into this
Declaration against the Property Trustee. In case a Trust Enforcement Event 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 negligent action, its
own negligent failure to act or its own willful misconduct, except that:
(i) prior to the occurrence of a Trust
Enforcement Event and after the curing or
waiving of all such Trust Enforcement Events
that may have occurred:
a. the duties and obligations of the
Property Trustee shall be
determined solely by the express
provisions of this Declaration
<PAGE> 30
24
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 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; but 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
without negligence, 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 Declaration 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 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;
<PAGE> 31
25
(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 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
Account maintained by the Property Trustee
pursuant to Section 3.8(c)(i) and except to
the extent otherwise required by law;
(viii) the Property Trustee shall not be
responsible for monitoring the compliance by
the Regular 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 Regular Trustees or the Sponsor; and
(ix) money held by the Trustee in trust hereunder
need not be segregated from other funds
except to the extent required by law. The
Trustee shall be under no liability for
interest on any money received by it
hereunder except as otherwise agreed in
writing with the Debenture Issuer.
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
Regular Trustees contemplated by this
Declaration shall be sufficiently evidenced
by an Officers' Certificate (or, with
respect to the establishment of the terms
and form of the Securities by the Regular
Trustees, by a Trustees' Authorization
Certificate);
(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
<PAGE> 32
26
Officers' Certificate which, upon receipt of
such request, shall be promptly delivered by
the Sponsor or the Regular 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 of its choice or other experts 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 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) shall be taken to relieve the
Property Trustee, upon the occurrence of an
Indenture 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,
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;
<PAGE> 33
27
(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, the Regular Trustees or the
Sponsor 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) if no Trust Enforcement Event has occurred
and is continuing and the Property Trustee
is required to decide between alternative
causes of action, construe ambiguous
provisions in their Declaration or is unsure
of the application of any provision of their
Declaration, and the matter is not one on
which Holders of Capital Securities are
entitled under the Declaration to vote, then
the Property Trustee may, but shall be under
no duty to, take such action as is directed
by the Sponsor and, if not so directed,
shall take such action as it deems advisable
and in the best interests of the Holders of
the Securities and will have no liability
except for its own bad faith, negligence or
willful misconduct;
(xii) 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;
(xiii) the Property Trustee shall not be liable for
any action taken, suffered or omitted to be
taken by it without negligence, in good
faith and reasonably believed by it to be
authorized or within the discretion, rights
or powers conferred upon it by this
Declaration; and
(xiv) the Trustee shall have a lien prior to the
Securities as to all property and funds held
by it hereunder for any amount owing it or
any predecessor Trustee, except with respect
to funds held in trust for the benefit of
the Holders of particular Securities.
<PAGE> 34
28
(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 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 6.2, 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 Trustees (except as required under the Business Trust
Act). Except as set forth in Section 6.2, the Delaware Trustee shall be a
Trustee for the sole and limited purpose of fulfilling the requirements of
Section 3807 of the Business Trust Act.
Section 3.12 Execution of Documents.
Unless otherwise determined by the Regular Trustees, and
except as otherwise required by the Business Trust Act, any Regular Trustee is
authorized to execute on behalf of the Trust any documents that the Regular
Trustees have the power and authority to execute pursuant to Section 3.6.
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, the Securities, the Debentures or the Indenture.
Section 3.14 Duration of Trust.
The Trust shall exist until terminated pursuant to the
provisions of Article 8 hereof.
Section 3.15 Mergers.
(a) The Trust may not consolidate, amalgamate, merge with or
into, or be replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other body, 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 Regular Trustees or, if there are more than two, a majority of
the Regular Trustees and without the consent of the Holders of the Securities,
the Delaware Trustee or the Property
<PAGE> 35
29
Trustee, consolidate, amalgamate, merge with or into, or be replaced by or
convey, transfer or lease its properties substantially as an entirety to a trust
organized as such under the laws of any State; provided that:
(i) if the Trust is not the successor, 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 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 with
respect to Distributions and
payments upon liquidation,
redemption and otherwise;
(ii) the Sponsor expressly appoints a trustee of
such Successor Entity that possesses the
same powers and duties as the Property
Trustee as the holder of the Debentures;
(iii) the Capital Securities or any Successor
Securities are listed, or any Successor
Securities will be listed upon notification
of issuance, on any national securities
exchange or with any other 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 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 Sponsor has received
an opinion of 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
<PAGE> 36
30
Securities (including any Successor
Securities) in any material respect;
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
c. following such merger,
consolidation, amalgamation or
replacement, the Trust (or the
Successor Entity) will continue to
be classified as a grantor trust
for United States Federal income
tax purposes;
(viii) the Sponsor or any permitted successor or
assignee owns all of the Common Securities
and guarantees the obligations of such
Successor Entity under the Successor
Securities at least to the extent provided
by the Guarantee; and
(ix) such Successor Entity expressly assumes all
of the obligations of the Trust with respect
to the Trustees.
(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 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 Successor Entity to be
classified as other than a grantor trust for United States Federal income tax
purposes and each Holder of the Securities not to be treated as owning an
undivided interest in the Debentures.
Section 3.16 Property Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other similar judicial proceeding relative to the Trust or any other obligor
upon the Securities or the property of the Trust or of such other obligor or
their creditors, the Property Trustee (irrespective of whether any Distributions
on the Securities shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Property Trustee shall
have made any demand on the Trust for the payment of any past due Distributions)
shall be entitled and empowered, to the fullest extent permitted by law, by
intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of any
Distributions owing and unpaid in respect of the Securities (or, if the
Securities are original issue discount Securities, such portion of the
liquidation amount as may be specified in the terms of such Securities) and to
file such other papers or documents as may be necessary or advisable in
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order to have the claims of the Property Trustee (including any claim for the
reasonable compensation, expenses, disbursements and advances of the Property
Trustee, its and counsel) and of the Holders allowed in such judicial
proceeding, and
(b) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Property Trustee and, in the event the
Property Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Property Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Property Trustee, its
agents and counsel, and any other amounts due the Property Trustee.
Nothing herein contained shall be deemed to authorize the
Property Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement adjustment or compensation
affecting the Securities or the rights of any Holder thereof or to authorize the
Property Trustee to vote in respect of the claim of any Holder in any such
proceeding.
ARTICLE 4
SPONSOR
Section 4.1 Responsibilities of the Sponsor.
In connection with the issuances and sales 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 one
or more registration statements on the applicable forms, including any
amendments thereto, pertaining to the Capital Securities, the Guarantee and the
Debentures;
(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) to prepare any filing by the Trust of an application to
the New York Stock Exchange, Inc. or any other national stock exchange or the
Nasdaq National Market or the PORTAL Market for listing, if such filing is
determined to be necessary or desirable by the Sponsor;
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(d) to prepare any filing by the Trust with the Commission of
a registration statement on Form 8-A, including any amendments thereto, if such
filing is determined to be necessary or desirable by the Sponsor;
(e) to negotiate the terms of one or more purchase agreements
and other related agreements providing for the sales of the Capital Securities
to the Initial Purchasers related thereto; and
(f) to negotiate the terms of one or more Registration Rights
Agreements.
Section 4.2 Compensation, Indemnification and Expenses of the
Trustee.
Pursuant to Sections 607 and 1009 of the Indenture, the
Sponsor, in its capacity as Debenture Issuer, agrees:
(1) to pay to the Trustees from time to time such compensation
as the Debenture Issuer and the Trustees shall from time to time agree
in writing for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust);
(2) except as otherwise expressly provided herein, to
reimburse the Trustees upon their request for all reasonable expenses,
disbursements and advances incurred or made by the Trustees in
accordance with any provision of this Indenture (including the
compensation and the expenses and disbursements of its agent and
counsel), except any such expense, disbursement or advance as may be
attributable to its negligence or bad faith; and
(3) to indemnify the Property Trustee and the Delaware Trustee
and their authorized agents for, and to hold each of them harmless
against, any loss, liability or expense including taxes (other than
taxes based upon, measured by or determined by the income of any
Trustee) incurred without negligence or bad faith on the part of the
Property Trustee, the Delaware Trustee or their respective authorized
agents, as the case may be, arising out of or in connection with the
acceptance or administration of the trust or trusts hereunder,
including the costs and expenses of defending any of them against any
claim or liability in connection with the exercise or performance of
any of their respective powers or duties hereunder; the provisions of
this Section 4.2 shall survive the resignation or removal of the
Delaware Trustee or the Property Trustee or the termination of this
Declaration.
ARTICLE 5
TRUST COMMON SECURITIES HOLDER
Section 5.1 Debenture Issuer's Purchases of Common Securities.
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On each Closing Date the Debenture Issuer will purchase all of
the Common Securities issued by the Trust on such Closing Date, for an amount at
least equal to (i) in the case of the initial Closing Date, 3% of the initial
capital of the Trust, and (ii) in the case of any subsequent Closing Date, 3% of
the additional capital added to the Trust on such Closing Date, in each case at
the same time as the related Capital Securities are sold on such Closing Date.
Section 5.2 Covenants of the Common Securities Holder.
For so long as the Capital Securities remain outstanding, the
Common Securities Holder will covenant (i) to maintain directly 100% ownership
of the Common Securities, (ii) to cause the Trust to remain a statutory business
trust and not to voluntarily dissolve, wind up, liquidate or be terminated,
except as permitted by this Declaration, (iii) to use its commercially
reasonable efforts to ensure that the Trust will not be an Investment Company
for purposes of the Investment Company Act, and (iv) to take no action which
would be reasonably likely to cause the Trust to be classified as an association
or a publicly traded partnership taxable as a corporation for United States
federal income tax purposes.
ARTICLE 6
TRUSTEES
Section 6.1 Number of Trustees.
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 or by written consent in lieu of such
meeting; provided that (1) the Delaware 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 and otherwise meets the requirements of applicable law;
(2) at least one Regular Trustee is an employee or officer of, or is affiliated
with, the Sponsor; 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.
Section 6.2 Delaware Trustee.
If required by the Business Trust Act, one Trustee (the
"Delaware Trustee") shall be:
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(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 6.3 Property Trustee; Eligibility.
(a) There shall at all times be one 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 other Person permitted by the
Commission to act as an institutional
trustee under the Trust Indenture Act,
authorized under such laws to exercise
corporate trust owners, 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 6.3(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 6.3(a), the Property Trustee shall immediately
resign in the manner and with the effect set forth in Section 6.6(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 Obliger 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 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.
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Section 6.4 Qualifications of Regular Trustees and Delaware
Trustee Generally.
Each Regular 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 6.5 Initial Regular Trustees.
The initial Regular Trustees shall be:
James D. Hogan, Bruce E. Barnes and Jennie P. Carlson, the
business address of all of whom is c/o Star Banc Corporation, 425 Walnut Street,
Cincinnati, Ohio 45202.
Section 6.6 Appointment, Removal and Resignation of Trustees.
(a) Subject to Section 6.6(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;
and
(ii) 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.
(b) The Trustee that acts as Property Trustee shall not be
removed in accordance with Section 6.6(a) until a successor Trustee possessing
the qualifications to act as Property Trustee under Section 6.3(a) (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 Regular Trustees and the Sponsor. The Trustee that acts as Delaware Trustee
shall not be removed in accordance with Section 6.6(a) until a successor Trustee
possessing the qualifications to act as Delaware Trustee under Sections 6.2 and
6.4 (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 Regular Trustees and the Sponsor.
(c) A Trustee appointed to office shall hold office until his
or its successor shall have been appointed, until his death or its dissolution
or until his or its 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:
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a. until a Successor Property Trustee has been appointed
and has accepted such appointment by instrument
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 6.6.
(e) If no Successor Property Trustee or Successor Delaware Trustee,
as the case may be, shall have been appointed and accepted appointment as
provided in this Section 6.6 within 30 days after delivery to the Sponsor and
the Trust of an instrument of resignation or removal, the resigning or removed
Property Trustee or Delaware Trustee, as applicable, may petition any court of
competent jurisdiction for appointment of a Successor Property Trustee or
Successor Delaware Trustee, as applicable. Such court may thereupon, after
prescribing such notice, if any, as it may deem proper, 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 6.7 Vacancies among Trustees.
If a Trustee ceases to hold office for any reason and the number of
Trustees is not reduced pursuant to Section 6.1, or if the number of Trustees is
increased pursuant to Section 6.1, a vacancy shall occur. The vacancy shall be
filled with a Trustee appointed in accordance with Section 6.6.
Section 6.8 Effect of Vacancies.
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 Regular Trustees shall occur, until such vacancy is filled by the appointment
of a Regular Trustee in accordance with Section 6.6, the
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Regular Trustees in office, regardless of their number, shall have all the
powers granted to the Regular Trustees and shall discharge all the duties
imposed upon the Regular Trustees by this Declaration.
Section 6.9 Delegation of Power.
(a) Any Regular Trustee may, by power of attorney consistent with
applicable law, delegate to any natural person over the age of 21 his, her or
its 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.
(b) The Regular 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 Regular Trustees or otherwise as the Regular 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 6.10 Merger, Conversion, Consolidation or Succession to
Business.
Any corporation into which the Property Trustee or the Delaware
Trustee, as the case may be, may be merged or converted or with which either may
be consolidated, or any corporation resulting from a 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 of 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 7
THE SECURITIES
Section 7.1 General Provisions Regarding Securities.
(a) The Regular Trustees shall on behalf of the Trust issue, in one
or more issuances, a class of capital securities representing undivided
beneficial ownership interests in the assets of the Trust (the "Transfer
Restricted Securities"), a class of capital securities to be only issued in
exchange for the Transfer Restricted Securities (the "New Capital Securities,"
and together with the Transfer Restricted Securities the "Capital Securities"),
and one class of common securities representing undivided beneficial ownership
interests in the assets of the Trust (the "Common Securities"). The aggregate
liquidation amount of Capital Securities and Common Securities that may be
issued by the Trust is unlimited; provided that the Common Securities
outstanding at any time must have an aggregate liquidation amount with respect
to the assets of the Trust equal to at least 3% of the assets of the Trust; and
provided further
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that after the initial issuance of Capital Securities and Common Securities, the
Trust may not issue additional Capital Securities or Common Securities unless
the Trustees have received an opinion of counsel to the effect that the issuance
of such securities will not affect the Trust's status as a grantor trust for
United States federal income tax purposes.
(i) Capital Securities. The Capital Securities of the Trust
will have a liquidation amount with respect to the
assets of the Trust of $1,000 per Capital Security. The
New Capital Security Certificates and the Transfer
Restricted Certificates evidencing the Capital
Securities shall be substantially in the form of Exhibit
A 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 on which the Capital
Securities are listed; provided, that the New Capital
Security Certificate shall not contain any of the
provisions following the Trustee's authentication.
(ii) Common Securities. The Common Securities of the Trust
will have a liquidation amount with respect to the
assets of the Trust of $1,000 per Common Security. The
Common Security Certificates evidencing the Common
Securities shall be substantially in the form of Exhibit
B to the Declaration, with such changes and additions
thereto or deletions therefrom as may be required by
ordinary usage, custom or practice.
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) Payment of Distributions on, and payments of the Redemption
Price upon a redemption of, the Capital Securities and the Common Securities, as
applicable, shall be made Pro Rata based on the liquidation amount of such
Capital Securities and Common Securities; provided, however, that if on any date
on which amounts payable on Distribution or redemption an Indenture Event of
Default shall have occurred and be continuing, no payment of any Distribution
on, or Redemption Price of, any of the Common Securities, and no other payment
on account of the redemption, liquidation or other acquisition of such Common
Securities, shall be made unless payment in full in cash of all accumulated and
unpaid Distributions on all of the outstanding Capital Securities for all
Distribution periods terminating on or prior thereto, or in the case of amounts
payable on redemption the full amount of the Redemption Price for all of the
outstanding Capital Securities then called for redemption, shall have been made
or provided for, and all funds available to the Property Trustee shall first be
applied to the payment in full in cash of all Distributions on, or payments of
the Redemption Price upon a redemption of, the Capital Securities then due and
payable.
(c) The Certificates shall be signed on behalf of the Trust by a
Regular Trustee. Such signature shall be the manual or facsimile signature of
any Regular Trustee. In case a Regular Trustee of the Trust who shall have
signed any of the Certificates shall cease to be such Regular Trustee before the
Certificates so signed shall be delivered by the
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Trust, such Certificates nevertheless may be delivered as though the person who
signed such Certificates had not ceased to be such Regular Trustee; and any
Certificate may be signed on behalf of the Trust by such persons who, at the
actual date of execution of such Certificate, shall be the Regular Trustees of
the Trust, although at the date of the execution and delivery of the Declaration
any such person was not such a Regular Trustee. Certificates shall be printed,
lithographed or engraved or may be produced in any other manner as is reasonably
acceptable to the Regular Trustees, as evidenced by their execution thereof, and
may have such letters, numbers or other marks of identification or designation
and such legends or endorsements as the Regular Trustees may deem appropriate,
or as may be required to comply with any law or with any rule or regulation of
any stock exchange on which Securities may be listed, or to conform to usage.
A Certificate shall not be valid until authenticated by the manual
signature of an authorized officer of the Property Trustee. Such signature shall
be conclusive evidence that the Certificate has been authenticated under this
Declaration.
In the event that the Trust elects to issue additional Securities
hereunder on a subsequent Closing Date, the Trust shall deliver to the Property
Trustee, in the manner provided in the following paragraph, duly executed
Certificates and a written order, together with such certificates and opinions
of counsel (in each case in substantially the form delivered at the initial
Closing Date), as are required for the issuance of Securities under this
Declaration, including the opinion of counsel required by Section 7.1(a).
Upon a written order of the Trust signed by one Regular Trustee, the
Property Trustee shall authenticate the Certificates for original issue. The
aggregate number of Capital Securities outstanding at any time shall not exceed
the liquidation amount set forth in Section 7(a).
The Property Trustee may appoint an authenticating agent acceptable
to the Trust to authenticate Certificates. An authenticating agent may
authenticate Certificates 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 of the Sponsor.
(d) 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.
(e) 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.
(f) Every Person, by virtue of having become a Holder 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 and the
terms of the Securities, the Guarantee, the Indenture and the Debentures.
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(g) The Securities shall have no preemptive rights.
Section 7.2 Distributions.
(a) Holders of Securities shall be entitled to receive cumulative
cash Distributions at a variable per annum rate on the stated liquidation amount
of $1,000 per Security equal to the variable per annum rate on the Debentures
calculated on the basis of the actual number of days elapsed in a year
consisting of twelve 30-day months. For any period shorter than a full 90-day
quarterly period, Distributions will be computed on the basis of the actual
number of days elapsed in such 90-day quarterly period. Subject to Section
7.1(b), Distributions shall be made on the Capital Securities and the Common
Securities on a Pro Rata basis. Distributions on the Securities shall be payable
quarterly only to the extent that the Trust has funds available for the payment
of such Distributions in the Property Account. Distributions not paid on the
scheduled payment date will accumulate and compound quarterly at the rate
payable on the Debentures, to the extent permitted by applicable law
("Compounded Distributions"). "Distributions" shall mean ordinary cumulative
distributions together with any Compounded Distributions. If and to the extent
that the Debenture Issuer makes a payment of interest (including 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 Pro Rata distribution of the
Payment Amount to Holders, subject to the terms of Section 7.1(b).
(b) Distributions on the Securities will be cumulative, will accrue
from June 8, 1997 and will be payable quarterly in arrears on the 15th day of
June, September, December and March, commencing September 15, 1997, when, as and
if available for payment, by the Property Trustee, except as otherwise described
below. If Distributions are not paid when scheduled, the accrued Distributions
shall be paid to the Holders of record of Securities as they appear on the books
and records of the Trust on the record date as determined under Section 7.2(c).
(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 relevant
record dates, which relevant record date shall be the 1st day of the month in
which the relevant payment dates occur. In the event that any date on which
distributions are payable on the Securities is not a Business Day, payment of
the distribution payable on such date will be made on the next succeeding day
which is a Business Day (without any interest or other payment in respect of any
such delay) with the same force and effect as if made on such date.
Section 7.3 Redemption of Securities; Distribution of Debentures.
(a) Upon the repayment or redemption, in whole or in part, of the
Debentures, the proceeds from such repayment or redemption shall be
simultaneously applied Pro Rata (subject to Section 7.1(b)) to redeem Securities
having an aggregate liquidation amount equal to the aggregate principal amount
of the Debentures so repaid or redeemed for an amount equal to the redemption
price paid by the Debenture Issuer in respect of such Debentures plus
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an amount equal to accrued and unpaid Distributions thereon through the date of
the redemption or such lesser amount as shall be received by the Trust in
respect of the Debentures so repaid or redeemed (the "Redemption Price").
Holders will be given not less than 30 or more than 60 days notice of such
redemption.
(b) If, at any time, a Special Event shall occur and be continuing,
the Sponsor may elect to, unless the Debentures are redeemed, within 90 days
following the occurrence of such Special Event, cause the dissolution of the
Trust upon not less than 30 nor more than 60 days' notice and, after
satisfaction of the claims of creditors, if any, cause the Debentures to be
distributed to the Holders of the Common Securities and the Capital Securities
in liquidation of the Trust.
(c) On the date fixed for any distribution of Debentures, upon
dissolution of the Trust, (i) the Capital Securities and the Common Securities
will no longer be deemed to be outstanding and (ii) certificates representing
Securities will be deemed to represent the Debentures having an aggregate
principal amount equal to the stated liquidation amount of, and bearing accrued
and unpaid interest equal to accrued and unpaid distributions on, such
Securities until such certificates are presented to the Sponsor or its agent for
transfer or reissuance.
Section 7.4 Redemption Procedures.
(a) 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 7.4, 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 redemption or exchange
proceedings with respect to any other Holder.
(b) If fewer than all the outstanding Securities are to be so
redeemed, the Common Securities and the Capital Securities will be redeemed Pro
Rata and the Capital Securities to be redeemed will be redeemed as described
below. The Trust may not redeem the Securities in part unless all accrued and
unpaid Distributions have been paid in full on all Securities then outstanding
plus accrued but unpaid Distributions to the date of redemption. For all
purposes of this Declaration, unless the context otherwise requires, all
provisions relating to the redemption of Capital Securities shall relate, in the
case of any Capital Security redeemed or to be redeemed only in part, to the
portion of the aggregate liquidation amount of Capital Securities which has been
or is to be redeemed.
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(c) If Securities are to be redeemed and the Trust gives a
Redemption/Distribution Notice, which notice may only be issued if the
Debentures are redeemed as set out in this Section 7.4 (which notice will be
irrevocable), then (A) by 12:00 noon, New York City time, on the redemption
date, the Property Trustee, upon receipt of such funds, will deposit irrevocably
with the DTC (in the case of Global Securities) or its nominee (or successor
clearing agency or its nominee) funds sufficient to pay the applicable
Redemption Price with respect to the Capital Securities and will give the DTC
irrevocable instructions and authority to pay the Redemption Price to the
Holders of the Capital Securities, and (B) with respect to Capital Securities
and Common Securities issued in definitive certificated form, 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, then immediately prior to
the close of business on the date of such deposit, Distributions will cease to
accrue on the Securities so called for redemption and all rights of Holders of
such Securities will cease, except the right of the Holders of such Securities
to receive the Redemption Price, but without interest on such Redemption Price.
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) except that, if such Business Day falls in the
next calendar year, such payment will be made on the immediately preceding
Business Day, in each case with the same force and effect as if made on such
date 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 Guarantee, Distributions
on such Securities will continue to accrue at the then applicable rate 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. For these purposes, the applicable Redemption
Price shall not include Distributions which are being paid to Holders who were
Holders on a relevant record date. Upon satisfaction of the foregoing
conditions, then immediately prior to the close of business on the date of such
deposit or payment, all rights of Holders of such Debentures so called for
redemption will cease, except the right of the Holders to receive the Redemption
Price, but without interest on such Redemption Price, and from and after the
date fixed for redemption, such Debentures will not accrue distributions or bear
interest.
Neither the Regular Trustees nor the Trust shall be required to
register or cause to be registered the transfer or exchange of any Securities
that have been called for redemption, except in the case of any Securities being
redeemed in part, any portion thereof not to be redeemed.
(d) Subject to the foregoing and applicable law (including, without
limitation, United States Federal securities laws), the Debenture Issuer 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.
<PAGE> 49
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Section 7.5 Voting Rights of Capital Securities.
(a) Except as provided under this Article VII and as otherwise
required by the Business Trust Act, the Trust Indenture Act and other applicable
law, the Holders of the Capital Securities will have no voting rights.
(b) Subject to the requirement of the Property Trustee obtaining a
tax opinion in certain circumstances set forth in Section 7.5(d) below, 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 Property Trustee, or to direct the exercise of any trust
or power conferred upon the Property Trustee under the Declaration, including
the right to direct the Property Trustee, as Holder of the Debentures, to (i)
exercise the remedies available to it under the Indenture as a Holder of the
Debentures or (ii) consent to any amendment or modification of the Indenture or
the Debentures where such consent shall be required; provided, however, that
where a consent or action under the Indenture would require the consent or act
of the Holders of more than a majority in aggregate principal amount of
Debentures affected thereby, only the Holders of the percentage of the aggregate
stated liquidation amount of the Capital Securities which is at least equal to
the percentage required under the Indenture may direct the Property Trustee to
give such consent or to take such action.
(c) If the Property Trustee fails to enforce its rights under the
Debentures after a Holder of record of Capital Securities has made a written
request, such Holder of record of Capital Securities may, to the extent
permitted by applicable law, institute a legal proceeding directly against the
Debenture Issuer to enforce the Property Trustee's rights under the Indenture
without first instituting any legal proceeding against the Property Trustee or
any other person or entity. Notwithstanding the foregoing, if a Trust
Enforcement Event has occurred and is continuing and such event is attributable
to the failure of the Debenture Issuer to make any required payment when due
under the Indenture, then a Holder of Capital Securities may directly institute
a proceeding against the Debenture Issuer for enforcement of such payment under
the Indenture.
(d) The Property Trustee shall notify all Holders of the Capital
Securities of any notice of any Indenture Event of Default received from the
Debenture Issuer with respect to the Debentures. Such notice shall state that
such Indenture Event of Default also constitutes a Trust Enforcement Event.
Except with respect to directing the time, method, and place of conducting a
proceeding for a remedy, the Property Trustee shall be under no obligation to
take any of the actions described in clause 7.5(b)(i) and (ii) above unless the
Property Trustee has obtained an opinion of independent tax counsel to the
effect that as a result of such action, the Trust will not fail to be classified
as a grantor trust for United States Federal income tax purposes and each Holder
will be treated as owning an undivided beneficial ownership interest in the
Debentures.
(e) In the event the consent of the Property Trustee, as the Holder
of the Debentures, is required under the Indenture with respect to any amendment
or modification of the Indenture, the Property Trustee shall request the
direction of the Holders of the Securities
<PAGE> 50
44
with respect to such amendment or modification and shall vote with respect to
such amendment or modification as directed by a Majority in Liquidation Amount
of the Securities voting together as a single class; provided, however, that
where a consent under the Indenture would require the consent of the Holders of
more than a majority in aggregate principal amount of the Debentures, the
Property Trustee may only give such consent at the direction of the Holders of
at least the same proportion in aggregate stated liquidation amount of the
Securities. The Property Trustee shall not take any such action in accordance
with the directions of the Holders of the Securities unless the Property Trustee
has obtained an opinion of tax counsel to the effect that, as a result of such
action, the Trust will not be classified as other than a grantor trust for
United States Federal income tax purposes and each Holder will be treated as
owning an undivided beneficial ownership interest in the Debentures.
(f) A waiver of an Indenture Event of Default with respect to the
Debentures will constitute a waiver of the corresponding Trust Enforcement
Event.
(g) Any required 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 or
pursuant to written consent. The Regular 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 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 the following information: (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.
(h) No vote or consent of the Holders of Capital Securities will be
required for the Trust to redeem and cancel Capital Securities or distribute
Debentures in accordance with the Declaration.
(i) Notwithstanding that Holders of Capital Securities are entitled
to vote or consent under any of the circumstances described above, any of the
Securities that are owned at such time by the Debenture Issuer or any entity
directly or indirectly controlled by, or under direct or indirect common control
with, the Debenture Issuer, shall not be entitled to vote or consent and shall,
for purposes of such vote or consent, be treated as if such Securities were not
outstanding, provided, however that persons otherwise eligible to vote to whom
the Debenture Issuer or any of its subsidiaries have pledged Capital Securities
may vote or consent with respect to such pledged Capital Securities under any of
the circumstances described herein.
(j) Holders of the Capital Securities will have no rights to appoint
or remove the Trustees, who may be appointed, removed or replaced solely by the
Debenture Issuer, as the Holder of all of the Common Securities.
Section 7.6 Voting Rights of Common Securities.
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(a) Except as provided under Section 6.1(b) or this Section 7.6 or
as otherwise required by the Business Trust Act, the Trust Indenture Act or
other applicable law or provided by the Declaration, the Holders of the Common
Securities will have no voting rights.
(b) The Holders of the Common Securities are entitled, in accordance
with Article 6 of the Declaration, to vote to appoint, remove or replace any
Trustee or to increase or decrease the number of Trustees.
(c) Subject to Section 2.6 of the Declaration and only after all
Trust Enforcement Events with respect to the Capital Securities have been cured,
waived, or otherwise eliminated and subject to the requirement of the Property
Trustee obtaining a tax opinion in certain circumstances set forth in this
paragraph (c), the Holders of a Majority in liquidation amount of the Common
Securities have the right to direct the time, method and place of conduction any
proceeding for any remedy available to the Property Trustee, or direct the
exercise of any trust or power conferred upon the Property Trustee under the
Declaration, including the right to direct the Property Trustee, as Holder of
the Debentures, to (i) exercise the remedies available to it under the Indenture
as a Holder of the Debentures, or (ii) consent to any amendment or modification
of the Indenture or the Debentures where such consent shall be required;
provided, however, that where a consent or action under the Indenture would
require the consent or act of the Holders of more than a majority in aggregate
principal amount of Debentures affected thereby, only the Holders of the
percentage of the aggregate stated liquidation amount of the Common Securities
which is at least equal to the percentage required under the Indenture may
direct the Property Trustee to have such consent or take such action. Except
with respect to directing the time, method, and place of conducting a proceeding
for a remedy, the Property Trustee shall be under no obligation to take any of
the actions described in clause 7.6(c)(i) and (ii) above unless the Property
Trustee has obtained an opinion of independent tax counsel to the effect that,
as a result of such action, for United States Federal income tax purposes the
Trust will not fail to be classified as a grantor trust and each Holder will be
treated as owning an undivided beneficial ownership interest in the Debentures.
(d) If the Property Trustee fails to enforce its rights under the
Debentures after a Holder of record of Common Securities has made a written
request, such Holder of record of Common Securities may, to the extent permitted
by applicable law, directly institute a legal proceeding directly against the
Debenture Issuer, as sponsor of the Trust, to enforce the Property Trustee's
rights under the Debentures without first instituting any legal proceeding
against the Property Trustee or any other person or entity.
(e) A waiver of an Indenture Event of Default with respect to the
Debentures will constitute a waiver of the corresponding Trust Enforcement
Event.
(f) Any required 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 or
pursuant to written consent. The Regular Trustees will cause a notice of any
meeting at which Holders of Common Securities are
<PAGE> 52
46
entitled to vote, or of any matter on which action by written consent of such
Holders is to be taken, to be mailed to each Holder of Common Securities. Each
such notice will include a statement setting forth the following information:
(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.
(g) No vote or consent of the Holders of Common Securities will be
required for the Trust to redeem and cancel Common Securities or to distribute
Debentures in accordance with the Declaration and the terms of the Securities.
Section 7.7 Paying Agent.
In the event that any Capital Securities are not in book-entry only
form, the Trust shall maintain in the Borough of Manhattan, City of New York,
State of New York, an office or agency where the Capital Securities may be
presented for payment ("Paying Agent"). The Trust may appoint the paying agent
and may appoint one or more additional paying agents in such other locations as
it shall determine. The term "Paying Agent" includes any additional paying
agent. The Trust may change any Paying Agent without prior notice to the
Holders. The Trust shall notify the Property Trustee of the name and address of
any Paying Agent not a party to this Declaration. If the Trust fails to appoint
or maintain another entity as Paying Agent, the Property Trustee shall act as
such. The Trust or any of its Affiliates may act as Paying Agent. The New York
Affiliate of The First National Bank of Chicago shall initially act as Paying
Agent for the Capital Securities and the Common Securities. In the event the
Property Trustee shall no longer be the Paying Agent, the Trust shall appoint a
successor (which shall be a bank or trust company acceptable to the Debenture
Issuer) to act as Paying Agent. The Paying Agent shall be permitted to resign as
Paying Agent upon 30 days' written notice to the Property Trustee and the
Debenture Issuer.
Section 7.8 Transfer of Securities.
(a) The Trust shall cause to be kept at the Corporate Trust Office
of the Property Trustee a register (the register maintained in such office being
herein sometimes referred to as the "Security Register") in which, subject to
such reasonable regulations as it may prescribe, the Trust shall provide for the
registration of Capital Securities and of transfers of Capital Securities. The
Property Trustee is hereby appointed "Security Registrar" for the purpose of
registering Capital Securities and transfers of Capital Securities as herein
provided.
(b) Upon surrender for registration of transfer of any Security at
an office or agency of the Trust designated for such purpose, the Trust shall
execute, and the Property Trustee shall authenticate and deliver, in the name of
the designated transferee or transferees, one or more new Securities of any
authorized denominations and of a like aggregate principal amount.
<PAGE> 53
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(c) At the option of the Holder, Securities may be exchanged for
other Securities of any authorized denominations and of a like aggregate
principal amount, upon surrender of the Securities to be exchanged at such
office or agency. Whenever any Securities are so surrendered for exchange, the
Trust shall execute, and the Property Trustee shall authenticate and deliver,
the Securities which the Holder making the exchange is entitled to receive.
(d) Every Security presented or surrendered for registration of
transfer or for exchange shall (if so required by the Trust or the Property
Trustee) be duly endorsed, or be accompanied by a written instrument of transfer
in form satisfactory to the Trust and the Security Registrar duly executed, by
the Holder thereof or his attorney duly authorized in writing.
(e) No service charge shall be made for any registration of transfer
or exchange of Securities, but the Trust may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Securities.
(f) If the Securities are to be redeemed in part, the Trust shall
not be required (A) to issue, register the transfer of or exchange any
Securities during a period beginning at the opening of business 15 days before
the day of the mailing of a notice of redemption of any such Securities selected
for redemption under Section 7.4 and ending at the close of business on the day
of such mailing, or (B) to register 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.
Section 7.9 Mutilated, Destroyed, Lost or Stolen Certificates.
If:
(a) any mutilated Certificates should be surrendered to the Regular
Trustees, or if the Regular Trustees shall receive evidence to their
satisfaction of the destruction, loss or theft of any Certificate; and
(b) there shall be delivered to the Regular Trustees such security
or indemnity as may be required by them to keep each of them, the Sponsor and
the Trust harmless, then, in the absence of notice that such Certificate shall
have been acquired by a bona fide purchaser, any Regular Trustee on behalf of
the Trust shall execute and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
denomination. In connection with the issuance of any new Certificate under this
Section 7.9, the Regular Trustees may require the payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
therewith. Any duplicate Certificate issued pursuant to this Section shall
constitute conclusive evidence of an ownership interest in the relevant
Securities, as if originally issued, whether or not the lost, stolen or
destroyed Certificate shall be found at any time.
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Section 7.10 Persons Deemed Security Holders.
The Trustees may treat the Person in whose name any Certificate
shall be registered on the books and records of the Trust as the sole holder of
such Certificate and of the Securities represented by such Certificate 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 Certificate or in the Securities represented by such
Certificate on the part of any other Person, whether or not the Trust shall have
actual or other notice thereof.
Section 7.11 Global Securities.
If the Trust shall establish that the Capital Securities are to be
issued in the form of one or more securities issued in book-entry form (each, a
"Global Security"), then a Regular Trustee on behalf of the Trust shall execute
and the Property Trustee shall authenticate and deliver one or more Global
Securities that (i) shall represent and shall be denominated in an amount equal
to the aggregate liquidation amount of all of the Capital Securities to be
issued in the form of Global Securities and not yet cancelled, (ii) shall be
registered in the name of the Depositary for such Global Security or Securities
or the nominee of such Depositary, and (iii) shall be delivered by the Property
Trustee to such Depositary or pursuant to such Depositary's instructions. Global
Securities shall bear a legend substantially to the following effect:
"This Capital Security is a Global Security within the meaning of
the Declaration hereinafter referred to and is registered in the name of a
Depositary or a nominee of a Depositary. Notwithstanding the provisions of
Section 7.8 of the Declaration, unless and until it is exchanged in whole or in
part for Capital Securities in definitive registered form, a Global Security
representing all or a part of the Capital Securities may not be transferred in
the manner provided in Section 7.8 of the Declaration except as a whole by the
Depositary to a nominee of such Depositary or by a nominee of such Depositary to
such Depositary or another nominee of such Depositary or by such Depositary or
any such nominee to a successor Depositary or a nominee of such successor
Depositary. Every Capital Security delivered upon registration or transfer of,
or in exchange for, or in lieu of, this Global Security shall be a Global
Security subject to the foregoing, except in the limited circumstances described
above. Unless this certificate is presented by an authorized representative of
DTC to the Trust or its agent for registration of transfer, exchange or payment,
and any certificate issued is registered in the name of Cede & Co. or in such
other name as is requested by an authorized representative of DTC (and any
payment is to be 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 inasmuch as the
registered owner hereof, Cede & Co., has an interest herein."
Definitive Capital Securities issued in exchange for all or a part
of a Global Security pursuant to this Section 7.11 shall be registered in such
names and in such authorized denominations as the Depositary, pursuant to
instructions from its direct or indirect
<PAGE> 55
49
participants or otherwise, shall instruct the Property Trustee. Upon execution
and authentication, the Property Trustee shall deliver such definitive Capital
Securities to the persons in whose names such definitive Capital Securities are
so registered.
At such time as all interests in Global Securities have been
redeemed, repurchased or canceled, such Global Securities shall be, upon receipt
thereof, canceled by the Property Trustee in accordance with standing procedures
and instructions existing between the Depositary and the Property Trustee. At
any time prior to such cancellation, if any interest in Global Securities is
exchanged for definitive Capital Securities, redeemed, canceled or transferred
to a transferee who receives definitive Capital Securities therefor or any
definitive Capital Security is exchanged or transferred for part of Global
Securities, the principal amount of such Global Securities shall, in accordance
with the standing procedures and instructions existing between the Depositary
and the Property Trustee, be reduced or increased, as the case may be, and an
endorsement shall be made on such Global Securities by the Property Trustee or
the Property Trustee, at the direction of the Property Trustee, to reflect such
reduction or increase.
The Trust and the Property Trustee may for all purposes, including
the making of payments due on the Capital Securities, deal with the Depositary
as the authorized representative of the Holders for the purposes of exercising
the rights of Holders hereunder. The rights of the owner of any beneficial
interest in a Global Security shall be limited to those established by law and
agreements between such owners and depository participants or Euroclear and
Cedel; provided that no such agreement shall give any rights to any person
against the Trust or the Property Trustee without the written consent of the
parties so affected. Multiple requests and directions from and votes of the
Depositary as holder of Capital Securities in global form with respect to any
particular matter shall not be deemed inconsistent to the extent they do not
represent an amount of Capital Securities in excess of those held in the name of
the Depositary or its nominee.
If at any time the Depositary for any Capital Securities represented
by one or more Global Securities notifies the Trust that it is unwilling or
unable to continue as Depositary for such Capital Securities or if at any time
the Depositary for such Capital Securities shall no longer be eligible under
this Section 7.11, the Trust shall appoint a successor Depositary with respect
to such Capital Securities. If a successor Depositary for such Capital
Securities is not appointed by the Trust within 90 days after the Trust receives
such notice or becomes aware of such ineligibility, the Trust's election that
such Capital Securities be represented by one or more Global Securities shall no
longer be effective and a Regular Trustee on behalf of the Trust shall execute,
and the Property Trustee will authenticate and deliver, Capital Securities in
definitive registered form, in any authorized denominations, in an aggregate
liquidation amount equal to the principal amount of the Global Security or
Global Securities representing such Capital Securities in exchange for such
Global Security or Global Securities.
The Trust may at any time and in its sole discretion determine that
the Capital Securities issued in the form of one or more Global Securities shall
no longer be represented by a Global Security or Global Securities. In such
event a Regular Trustee on behalf of the
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Trust shall execute, and the Property Trustee shall authenticate and deliver,
Capital Securities in definitive registered form, in any authorized
denominations, in an aggregate liquidation amount equal to the principal amount
of the Global Security or Global Securities representing such Capital
Securities, in exchange for such Global Security or Global Securities.
Notwithstanding any other provisions of this Declaration (other than
the provisions set forth in Section 7.13(a)), Global Securities may not be
transferred as a whole except 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 or by the Depositary or any such nominee to a successor Depositary or
a nominee of such successor Depositary.
Interests of beneficial owners in a Global Security may be
transferred or exchanged for definitive Capital Securities and definitive
Capital Securities may be transferred or exchange for Global Securities in
accordance with rules of the Depositary and the provisions of Section 7.13.
Any Capital Security in global form may be endorsed with or have
incorporated in the text thereof such legends or recitals or changes not
inconsistent with the provisions of this Declaration as may be required by the
Property Trustee, the Depositary or by the National Association of Securities
Dealers, Inc. in order for the Capital Securities to be tradeable on the PORTAL
Market or as may be required for the Capital Securities to be tradeable on any
other market developed for trading of securities pursuant to Rule 144A or
required to comply with any applicable law or any regulation thereunder or with
Regulation S or with the rules and regulations of any securities exchange upon
which the Capital Securities may be listed or traded or to conform with any
usage with respect thereto, or to indicate any special limitations or
restrictions to which any particular Capital Securities are subject.
Section 7.12 Restrictive Legend.
(a) Each Global Security and definitive Capital Security that
constitutes a Restricted Security shall bear the following legend (the "Private
Placement Legend") on the face thereof until three years after the later of the
date of original issue and the last date on which the Sponsor or any affiliate
of the Sponsor was the owner of such Capital Securities (or any predecessor
thereto) (the "Resale Restriction Termination Date"), unless otherwise agreed by
the Trust and the Holder thereof:
"THIS CAPITAL SECURITY (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR
ANY STATE SECURITIES LAWS AND NEITHER THIS CAPITAL SECURITY NOR ANY
INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. EACH PURCHASER OF THIS CAPITAL SECURITY IS HEREBY NOTIFIED THAT
THE SELLER MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION
5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF
THIS CAPITAL SECURITY, BY ITS
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ACCEPTANCE HEREOF, REPRESENTS, ACKNOWLEDGES AND AGREES FOR THE BENEFIT OF
THE TRUST THAT: (I) IT HAS ACQUIRED A "RESTRICTED" SECURITY WHICH HAS NOT
BEEN REGISTERED UNDER THE SECURITIES ACT; (II) IT WILL NOT OFFER, SELL OR
OTHERWISE TRANSFER THIS CAPITAL SECURITY PRIOR TO THE LATER OF THE DATE
WHICH IS TWO YEARS AFTER THE DATE OF ORIGINAL ISSUANCE HEREOF AND THE LAST
DATE ON WHICH THE TRUST OR ANY AFFILIATE OF THE TRUST WAS THE OWNER OF
SUCH RESTRICTED SECURITIES (OR ANY PREDECESSOR) EXCEPT (A) TO THE TRUST,
(B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE
UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THIS CAPITAL SECURITY IS
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON WHO THE SELLER
REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (D) OUTSIDE THE UNITED STATES IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT, OR (E)
PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT AND, IN EACH CASE, IN ACCORDANCE WITH THE APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY APPLICABLE
JURISDICTION; AND (III) IT WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED
TO, NOTIFY ANY PURCHASER FROM IT OF THIS CAPITAL SECURITY OF THE RESALE
RESTRICTIONS SET FORTH IN (II) ABOVE. ANY OFFER, SALE OR OTHER DISPOSITION
PURSUANT TO THE FOREGOING CLAUSES (II)(D) AND (E) IS SUBJECT TO THE RIGHT
OF THE ISSUER OF THIS CAPITAL SECURITY AND THE PROPERTY TRUSTEE FOR SUCH
CAPITAL SECURITIES TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATIONS OR OTHER INFORMATION ACCEPTABLE TO THEM IN FORM AND
SUBSTANCE."
Any Capital Security (or security issued in exchange or substitution
therefor) as to which such restrictions on transfer shall have expired in
accordance with their terms may, upon satisfaction of the requirements of
Section 7.12(b) and surrender of such Capital Security for exchange to the
Capital Security registrar in accordance with the provisions of this Section
7.12(a), be exchanged for a new Capital Security or Capital Securities, of like
tenor and aggregate liquidation amount, which shall not bear the restrictive
legend required by this Section 7.12(a).
(b) Upon any sale or transfer of any Restricted Security (including
any interest in a Global Security) (i) that is effected pursuant to an effective
registration statement under the Securities Act or (ii) in connection with which
the Property Trustee receives certificates and other information (including an
opinion of counsel, if requested) reasonably acceptable to the Sponsor and the
Property Trustee to the effect that such security will no longer be subject to
the resale restrictions under federal and state securities laws, then (A) in the
case of a Restricted Security in definitive form, the Capital Security registrar
or co-registrar shall permit the holder thereof to exchange such Restricted
Security for a security
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that does not bear the legend set forth in Section 7.12(a), and shall rescind
any such restrictions on transfer and (B) in the case of Restricted Securities
represented by a Global Security, such Capital Security shall no longer be
subject to the restrictions contained in the legend set forth in Section 7.12(a)
(but still subject to the other provisions hereof). In addition, any Capital
Security (or security issued in exchange or substitution therefor) as to which
the restrictions on transfer described in the legend set forth in Section
7.12(a) have expired by their terms, may, upon surrender thereof (in accordance
with the terms of this Declaration) together with such certifications and other
information (including an opinion of counsel having substantial experience in
practice under the Securities Act and otherwise reasonably acceptable to the
Sponsor, addressed to the Sponsor and the Property Trustee and in a form
acceptable to the Sponsor, to the effect that the transfer of such Restricted
Security has been made in compliance with Rule 144 or such successor provision)
acceptable to the Sponsor and the Property Trustee as either of them may
reasonably require, be exchanged for a new Capital Security or Capital
Securities of like tenor and aggregate liquidation amount, which shall not bear
the restrictive legends set forth in Section 7.12(a).
Section 7.13 Special Transfer Provisions.
(a) At any time at the request of the beneficial holder of a Capital
Security in global form, such beneficial holder shall be entitled to obtain a
definitive Capital Security upon written request to the Property Trustee in
accordance with the standing instructions and procedures existing between the
Depositary and the Property Trustee for the issuance thereof. Any transfer of a
beneficial interest in a Capital Security in global form which cannot be
effected through book-entry settlement must be effected by the delivery to the
transferee (or its nominee) of a definitive Capital Security or Securities
registered in the name of the transferee (or its nominee) on the books
maintained by the Capital Securities registrar. With respect to any such
transfer, the Property Trustee will cause, in accordance with the standing
instructions and procedures existing between the Depositary and the Property
Trustee, the aggregate liquidation amount of the Global Security to be reduced
and, following such reduction, the Property Trustee will cause definitive
Capital Securities in the appropriate aggregate liquidation amount registered in
the name of such transferee (or its nominee) and bearing such restrictive
legends as may be required by this Declaration to be delivered. In connection
with any such transfer, the Property Trustee may request such representations
and agreements relating to the restrictions on transfer of such Capital
Securities from such transferee (or such transferee's nominee) as the Property
Trustee may reasonably require.
(b) So long as the Capital Securities are eligible for book-entry
settlement, or unless otherwise required by law, upon any transfer of a
definitive Capital Security to a QIB in accordance with Rule 144A, unless
otherwise requested by the transferor, and upon receipt of the definitive
Capital Security being so transferred, together with a certification from the
transferor that the transferor reasonably believes the transferee is a QIB (or
other evidence satisfactory to the Property Trustee), the Property Trustee shall
make an endorsement on the Restricted Global Security to reflect an increase in
the aggregate liquidation amount of the Restricted Global Security, and the
Property Trustee shall cancel such definitive Capital Security and cause, in
accordance with the standing instructions and procedures existing
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between the Depositary and the Property Trustee, the aggregate liquidation
amount of Capital Securities represented by the Restricted Global Security to be
increased accordingly.
(c) So long as the Capital Securities are eligible for book-entry
settlement, or unless otherwise required by law, upon any transfer of a
definitive Capital Security in accordance with Regulation S, if requested by the
transferor, and upon receipt of the definitive Capital Security or Capital
Securities being so transferred, together with a certification from the
transferor that the transfer was made in accordance with Rule 903 or 904 of
Regulation S or Rule 144 under the Securities Act (or other evidence
satisfactory to the Property Trustee), the Property Trustee shall make or direct
the custodian for the Global Securities to make, an endorsement on the
Regulation S Global Security to reflect an increase in the aggregate liquidation
amount of the Capital Securities represented by the Regulation S Global
Security, the Property Trustee shall cancel such definitive Capital Security or
Capital Securities and cause, or direct the custodian to cause, in accordance
with the standing instructions and procedures existing between the Depositary
and the Property Trustee, the aggregate liquidation amount of Capital Securities
represented by the Regulation S Global Security to be increased accordingly.
(d) If a holder of a beneficial interest in the Restricted Global
Security wishes at any time to exchange its interest in the Restricted Global
Security for an interest in the Regulation S Global Security, or to transfer its
interest in the Restricted Global Security to a person who wishes to take
delivery thereof in the form of an interest in the Regulation S Global Security,
such holder may, subject to the rules and procedures of the Depositary and to
the requirements set forth in the following sentence, exchange or cause the
exchange or transfer or cause the transfer of such interest for an equivalent
beneficial interest in the Regulation S Global Security. Upon receipt by the
Property Trustee, as transfer agent of (1) instructions given in accordance with
the Depositary's procedures from or on behalf of a holder of a beneficial
interest in the Restricted Global Security, directing the Property Trustee (via
DWAC), as transfer agent, to credit or cause to be credited a beneficial
interest in the Regulation S Global Security in an amount equal to the
beneficial interest in the Restricted Global Security to be exchanged or
transferred, (2) a written order given in accordance with the Depositary's
procedures containing information regarding the Euroclear or Cedel account to be
credited with such increase and the name of such account, and (3) a certificate
given by the holder of such beneficial interest stating that the exchange or
transfer of such interest has been made pursuant to and in accordance with Rule
903 or Rule 904 of Regulation S or Rule 144 under the Securities Act (or other
evidence satisfactory to the Property Trustee), the Property Trustee, as
transfer agent, shall promptly deliver appropriate instructions (via DWAC) to
the Depositary, its nominee, or the custodian for the Depositary, as the case
may be, to reduce or reflect on its records a reduction of the Restricted Global
Security by the aggregate liquidation amount of the beneficial interest in such
Restricted Global Security to be so exchanged or transferred from the relevant
participant, and the Property Trustee, as transfer agent, shall promptly deliver
appropriate instructions (via DWAC) to the Depositary, its nominee, or the
custodian for the Depositary, as the case may be, concurrently with such
reduction, to increase or reflect on its records an increase of the liquidation
amount of such Regulation S Global Security by the aggregate liquidation amount
of the beneficial interest in such Restricted Global Security to be so exchanged
or transferred, and to credit or cause to be
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credited to the account of the person specified in such instructions (who may be
Morgan Guaranty Trust Company of New York, Brussels office, as operator of
Euroclear, or Cedel or another agent member of Euroclear, or Cedel, or both, as
the case may be, acting for and on behalf of them) a beneficial interest in such
Regulation S Global Security equal to the reduction in the liquidation amount of
such Restricted Global Security.
(e) If a holder of a beneficial interest in the Regulation S Global
Security wishes at any time to exchange its interest in the Regulation S Global
Security for an interest in the Restricted Global Security, or to transfer its
interest in the Regulation S Global Security to a person who wishes to take
delivery thereof in the form of an interest in the Restricted Global Security,
such holder may, subject to the rules and procedures of Euroclear or Cedel and
the Depositary, as the case may be, and to the requirements set forth in the
following sentence, exchange or cause the exchange or transfer or cause the
transfer of such interest for an equivalent beneficial interest in such
Restricted Global Security. Upon receipt by the Property Trustee, as transfer
agent of (l) instructions given in accordance with the procedures of Euroclear
or Cedel and the Depositary, as the case may be, from or on behalf of a
beneficial owner of an interest in the Regulation S Global Security directing
the Property Trustee, as transfer agent, to credit or cause to be credited a
beneficial interest in the Restricted Global Security in an amount equal to the
beneficial interest in the Regulation S Global Security to be exchanged or
transferred, (2) a written order given in accordance with the procedures of
Euroclear or Cedel and the Depositary, as the case may be, containing
information regarding the account with the Depositary to be credited with such
increase and the name of such account, and (3) prior to the expiration of the
related Restricted Period, a certificate given by the holder of such beneficial
interest and stating that the person transferring such interest in such
Regulation S Global Security reasonably believes that the person acquiring such
interest in the Restricted Global Security is a QIB and is obtaining such
beneficial interest in a transaction meeting the requirements of Rule 144A and
any applicable securities laws of any state of the United States or any other
jurisdiction (or other evidence satisfactory to the Property Trustee), the
Property Trustee, as transfer agent, shall promptly deliver (via DWAC)
appropriate instructions to the Depositary, its nominee, or the custodian for
the Depositary, as the case may be, to reduce or reflect on its records a
reduction of the Regulation S Global Security by the aggregate liquidation
amount of the beneficial interest in such Regulation S Global Security to be
exchanged or transferred, and the Property Trustee, as transfer agent, shall
promptly deliver (via DWAC) appropriate instructions to the Depositary, its
nominee, or the custodian for the Depositary, as the case may be, concurrently
with such reduction, to increase or reflect on its records an increase of the
liquidation amount of the Restricted Global Security by the aggregate
liquidation amount of the beneficial interest in the Regulation S Global
Security to be so exchanged or transferred, and to credit or cause to be
credited to the account of the person specified in such instructions a
beneficial interest in the Restricted Global Security equal to the reduction in
the liquidation amount of the Regulation S Global Security. After the expiration
of the related Restricted Period, the certification requirement set forth in
clause (3) of the second sentence of this Section 7.13(e) will no longer apply
to such exchanges and transfers.
(f) Any beneficial interest in one of the Global Securities that is
transferred to a person who takes delivery in the form of an interest in the
other Global Security will, upon
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transfer, cease to be an interest in such Global Security and become an interest
in the other Global Security and, accordingly, will thereafter be subject to all
transfer restrictions and other procedures applicable to beneficial interests in
such other Global Security for as long as it remains such an interest.
(g) For each Closing Date, prior to or on the 40th day after the
later of the commencement of the offering of the Capital Securities issued in
connection with such Closing Date and such Closing Date (each such period, a
"Restricted Period"), beneficial interests in a Regulation S Global Security
issued in connection with such Closing Date may only be held through Morgan
Guaranty Trust Company of New York, Brussels office, as operator of Euroclear,
or Cedel or another agent member of Euroclear and Cedel acting for and on behalf
of them, unless delivery is made through a Restricted Global Security in
accordance with the certification requirements hereof. During a Restricted
Period, interests in the Regulation S Global Security may be exchanged for
interests in a Restricted Global Security or for definitive Capital Securities
only in accordance with the certification requirements described above.
ARTICLE 8
DISSOLUTION AND TERMINATION OF TRUST
Section 8.1 Dissolution and Termination of Trust.
(a) The Trust shall dissolve upon the earliest of:
(i) June 15, 2057;
(ii) any bankruptcy, insolvency, liquidation or similar
proceeding with respect to the Holder of the Common
Securities or the Sponsor or all or substantially all of
their properties;
(iii) the entry of a decree of judicial dissolution of the
Sponsor or the Trust;
(iv) the time when all of the Securities shall have matured
or been called for redemption and the amounts then due
shall have been paid to the Holders in accordance with
the terms of the Securities;
(v) upon the election of the Sponsor, following the
occurrence and continuation of a Special Event, pursuant
to which the Trust shall have been dissolved in
accordance with the terms of the Securities, and all of
the Debentures shall have been distributed to the
Holders of Securities in exchange for all of the
Securities; or
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(vi) an election by a Majority in Liquidation Amount of the
Common Securities provided such action is taken before
the issuance of any Securities.
(b) As soon as is practicable after the occurrence of an event
referred to in Section 8.1(a) and upon completion of the winding up of the Trust
in accordance with Section 8.2 hereof, the Trustees shall terminate the Trust by
filing a certificate of cancellation with the Secretary of State of the State of
Delaware.
(c) The provisions of Section 3.9 and Article 10 shall survive the
termination of the Trust.
Section 8.2 Liquidation Distribution Upon Termination and
Dissolution of the Trust.
(a) In the event of any voluntary or involuntary liquidation,
dissolution, winding-up or termination of the Trust (each a "Liquidation"), the
Holders of the Capital Securities on the date of the Liquidation will be
entitled to receive, out of the assets of the Trust available for distribution
to Holders of Securities after satisfaction of the Trust's liabilities in
accordance with applicable law, distributions in cash or other immediately
available funds in an amount equal to the aggregate of the stated liquidation
amount of $1,000 per Security plus accrued and unpaid Distributions thereon to
the date of payment (such amount being the "Liquidation Distribution"), unless,
in connection with such Liquidation, Debentures in an aggregate principal amount
equal to the aggregate liquidation amount of, with a Distribution rate
identical to the interest rate of, and accrued and unpaid distributions equal to
accrued and unpaid Distributions on, such Securities shall be distributed on a
Pro Rata basis to the Holders of the Securities in exchange for such Securities.
(b) If, upon any such Liquidation, the Liquidation Distribution can
be paid only in part because the Trust has insufficient assets available to pay
in full the aggregate Liquidation Distribution, then the amounts payable
directly by the Trust on the Securities shall be paid on a Pro Rata basis. The
Holders of the Common Securities will be entitled to receive distributions upon
any such Liquidation Pro Rata with the Holders of the Capital Securities except
that if an Indenture Event of Default has occurred and is continuing, the
Capital Securities shall have a preference over the Common Securities with
regard to such distributions.
ARTICLE 9
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
Section 9.1 Liability.
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(a) Except as expressly set forth in this Declaration, the Guarantee
and the terms of the Securities, the Sponsor:
(i) shall not be personally liable for the return of any
portion of the capital contributions (or any return
thereon) of the Holders of the Securities which shall be
made solely from assets of the Trust; and
(ii) shall not be required to pay to the Trust or to any
Holder of Securities any deficit upon dissolution of the
Trust or otherwise.
(b) The Holder of the Common Securities 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 9.2 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 or 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 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 9.3 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 an other Covered Person for
its good faith reliance on the provisions of this Declaration. The provisions of
this Declaration, to the extent that they restrict the duties and liabilities of
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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 9.4 Indemnification.
(a)(i) The Debenture Issuer shall indemnify, to the full extent
permitted by law, any Debenture Issuer Indemnified Person who was or is a party
or is threatened to be made a party to 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 Debenture Issuer Indemnified Person against
expenses (including attorney fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted
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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 Debenture Issuer 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 Debenture Issuer 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 Debenture Issuer Indemnified
Person against expenses (including attorneys' fees) 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 Debenture Issuer 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) Any indemnification under paragraphs (i) and (ii) of this
Section 9.4(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 Debenture Issuer 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 Regular
Trustees by a majority vote of a quorum consisting of such Regular 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 Regular
Trustees so directs, by independent legal counsel in a written opinion, or (3)
by the Holder of the Common Securities of the Trust.
(iv) Expenses (including attorneys' fees) incurred by a Debenture
Issuer Indemnified Person in defending a civil, criminal, administrative or
investigative action, suit or proceeding referred to in paragraphs (i) and (ii)
of this Section 9.4(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 Debenture Issuer 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 9.4(a).
Notwithstanding the foregoing, no advance shall be made by the Debenture Issuer
if a determination is reasonably and promptly made (i) by the Regular Trustees
by a majority vote of a quorum of disinterested Regular Trustees, (ii) if such a
quorum is not obtainable, or, even if obtainable, if a quorum of disinterested
Regular Trustees so directs, by independent legal counsel in a written opinion
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or (iii) by the Holder of the Common Securities of the Trust, that, based upon
the facts known to the Regular Trustees, counsel or the Holder of the Common
Securities at the time such determination is made, such Debenture Issuer
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 Debenture Issuer 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 Regular Trustees,
independent legal counsel or Holder of the Common Securities reasonably
determine that such person deliberately breached his duty to the Trust or the
Holders of the Common or Capital Securities.
(v) The indemnification and advancement of expenses provided by,
or granted pursuant to, the other paragraphs of this Section 9.4(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 Holder of the
Common Securities 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 9.4(a) shall be deemed to be
provided by a contract between the Debenture Issuer and each Debenture Issuer
Indemnified Person who serves in such capacity at any time while this Section
9.4(a) is in effect. Any repeal or modification of this Section 9.4(a) shall not
affect any rights or obligations then existing.
(vi) The Debenture Issuer or the Trust may purchase and maintain
insurance on behalf of any person who is or was a Debenture Issuer 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 9.4(a).
(vii) For purposes of this Section 9.4(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 9.4(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.
(viii) The indemnification and advancement of expenses provided by,
or granted pursuant to, this Section 9.4(a) shall, unless otherwise provided
when authorized or ratified, continue as to a person who has ceased to be a
Debenture Issuer Indemnified Person and shall inure to the benefit of the heirs,
executors and administrators of such a person. The obligation to indemnify as
set forth in this Section 9.4(a) shall survive the satisfaction and discharge of
this Declaration.
(b) The Debenture Issuer agrees to indemnify the (i) Property
Trustee, (ii) the Delaware Trustee, (iii) an Affiliate of the Property Trustee
and the Delaware Trustee, and (iv) any officers, directors, shareholders,
members, partners, employees, representatives,
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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 Person") for, and to hold each Fiduciary Indemnified Person harmless
against, any loss, liability 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 provisions of this
Section 9.4(a) shall survive the satisfaction and discharge of this Declaration
or the resignation or removal of the Property Trustee or the Delaware Trustee,
as the case may be.
Section 9.5 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 activities 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 activities 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 10
ACCOUNTING
Section 10.1 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 10.2 Certain Accounting Matters.
(a) At all times during the existence of the Trust, the Regular
Trustees shall keep, or cause to be kept, full 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. The
Trust shall use the accrual method of accounting for United States
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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
Regular Trustees.
(b) The Regular 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 Regular Trustees shall cause to be duly prepared and
delivered to each of the Holders of Securities, an 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 Regular Trustees shall
endeavor to deliver all such statements within 30 days after the end of each
Fiscal Year of the Trust.
(d) The Regular 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 Regular Trustees on behalf of the Trust with any state or local taxing
authority.
Section 10.3 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 Account and no other funds of the Trust shall be deposited in
the Property Account. The sole signatories for such accounts shall be designated
by the Regular Trustees; provided, however, that the Property Trustee shall
designate the signatories for the Property Account.
Section 10.4 Withholding.
The Trust and the Regular Trustees shall comply 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 Regular 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
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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 11
AMENDMENTS AND MEETINGS
Section 11.1 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 Regular Trustees (or, if
there are more than two Regular Trustees, a majority of the Regular Trustees),
(ii) by the Property Trustee if the amendment affects the rights, powers,
duties, obligations or immunities of the Property Trustee; and (iii) by the
Delaware Trustee if the amendment affects the rights, powers, duties,
obligations or immunities of 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);
(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); and
(iii) to the extent the result of such amendment would be to:
a. cause the Trust to be classified other than as a grantor
trust for United States Federal income tax purposes;
<PAGE> 70
64
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, if the amendment would (i) adversely affect the powers,
preferences or special rights of the Securities, whether by way of amendment to
the Declaration or otherwise or (ii) result in the dissolution, winding-up or
termination of the Trust other than pursuant to the terms of this Declaration,
or (iii) change the amount or timing of any distribution on the Securities or
otherwise adversely affect the amount of any distribution required to be made in
respect of the Securities as of a specified date, then the Holders of the
Securities voting together as a single class will be entitled to vote on such
amendment or proposal and such amendment or proposal shall not be effective
except with the approval of at least a Majority in Liquidation Amount of the
Securities affected thereby; provided that, if any amendment or proposal
referred to in clause (i) above would adversely affect only the Capital
Securities or the Common Securities, then only the affected class will be
entitled to vote on such amendment or proposal and such amendment or proposal
shall not be effective except with the approval of a Majority in Liquidation
Amount of such class of Securities.
(d) Sections 7.8, 9.1 and this Section 11.1 shall not be amended
without the consent of all of the Holders of the Securities. In addition,
notwithstanding any other provision of this Declaration to the contrary, without
the consent of each Holder of a Security affected thereby, this Declaration may
not be amended to (i) reduce the amount or change the timing of any Distribution
required to be made on the Securities or the Redemption Price to be paid in
respect thereof, or (ii) restrict the right of a Holder of Securities to
institute suit for the enforcement of any such payment on or after the date such
payment is due or to bring a Direct Action, or (iii) amend the provisions of
this Section 11.1(d).
(e) Article 4 shall not be amended without the consent of the
Holders of a Majority in Liquidation Amount of the Common Securities.
(f) The rights of the Holders of the Common Securities under Article
6 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.
(g) Notwithstanding Section 11.1(c), this Declaration may be amended
without the consent of the Holders of the Securities to:
(i) to cure any ambiguity, correct or supplement any
provisions in this Declaration that may be inconsistent
with any other provision, or to make any other
provisions with respect to matters or questions arising
under this Declaration that shall not be inconsistent
with the other provisions of this Declaration;
<PAGE> 71
65
(ii) to modify, eliminate or add to any provisions of this
Declaration to such extent as shall be necessary to
ensure that the Trust will be classified as a grantor
trust and will not be taxable as a corporation for
United States federal income tax purposes 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;
or
(iii) to conform to any change in Rule 3a-5 or written change
in interpretation or application of Rule 3a-5 by any
legislative body, court, government agency or regulatory
authority;
provided, however, that such action shall not adversely affect in any material
respect the interests of any Holder of Capital Securities or Common Securities
Any amendments of this Declaration shall become effective when notice thereof is
given to the Holders of Capital Securities and Common Securities.
(h) The issuance of an order by the Regular Trustees for purposes of
establishing the terms and form of the Securities as contemplated by Section 7.1
shall not be deemed an amendment of this Declaration subject to the provisions
of this Section 11.1.
Section 11.2 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 Regular 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 Regular 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 Regular Trustees one or more calls 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
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:
(i) notice of any such meeting shall be given to all the
Holders of Securities having a right to vote thereat at
least 7 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
<PAGE> 72
66
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 Regular Trustees may specify that any
written ballot submitted to the Security Holders for the
purpose of taking any action without a meeting shall be
returned to the Trust within the time specified by the
Regular 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 such
proxy. 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 Regular Trustees or by such other
Person that the Regular Trustees may designate; and
(iv) consistent with 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 for
trading, otherwise provides, the Regular 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 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 12
<PAGE> 73
67
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
Section 12.1 Representations and Warranties of the 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 corporation or bank duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
incorporation or organization, 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 Property Trustee satisfies the requirements set forth in
Section 6.3(a);
(c) the execution, delivery and performance by the Property Trustee
of this Declaration has been duly authorized by all necessary corporate action
on the part of the Property Trustee. This Declaration has been duly executed and
delivered by the Property Trustee, and it 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);
(d) the execution, delivery and performance of this Declaration by
the Property Trustee does not conflict with or constitute a breach of the
articles of association or incorporation, as the case may be, or the by-laws (or
other similar organizational documents) of the Property Trustee; and
(e) no consent, approval or authorization of, or registration with
or notice to, any State or Federal banking authority is required for the
execution, delivery or performance by the Property Trustee of this Declaration.
Section 12.2 Representations and Warranties of the 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 satisfies the requirements set forth in
Section 6.2 and has the power and authority to execute and deliver, and to carry
out and perform its obligations under the terms of, this Declaration and, if it
is not a natural person, is duly
<PAGE> 74
68
organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation or organization;
(b) the Delaware Trustee has been authorized to perform its
obligations under the Certificate of Trust and this Declaration. This
Declaration under Delaware law 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);
and
(c) no consent, approval or authorization of, or registration with
or notice to, any State or Federal banking authority is require for the
execution, delivery or performance by the Delaware Trustee of this Declaration.
<PAGE> 75
69
ARTICLE 13
MISCELLANEOUS
Section 13.1 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 registered or certified mail, as follows:
(a) if given to the Trust, in care of the Regular Trustees at the
Trust's mailing address set forth below (or such other address as the Trust may
give notice of to the Property Trustee, the Delaware Trustee and the Holders of
the Securities):
c/o Star Banc Corporation
425 Walnut Street,
Cincinnati, Ohio 45202
Attention: General Counsel
Fax: (513) 632-5512
(b) if given to the Delaware Trustee, at the mailing address set
forth below (or such other address as the Delaware Trustee may give notice of to
the Regular Trustees, the Property Trustee and the Holders of the Securities):
First Chicago Delaware Inc.
300 King Street
Wilmington, DE 19801
Attention: Michael J. Majchrzak
(c) if given to the Property Trustee, at its Corporate Trust Office
set forth below (or such other address as the Property Trustee may give notice
of to the Regular Trustees, the Delaware Trustee and the Holders of the
Securities).
The First National Bank of Chicago
One First National Plaza, Suite 0126,
Chicago, Illinois 60670-0126,
Attention: Corporate Trust Services Division
(d) if given to the Sponsor, at the mailing address set forth below
(or such other address as the Sponsor may give notice of to the Property
Trustee, the Delaware Trustee and the Trust):
Star Banc Corporation
425 Walnut Street,
Cincinnati, Ohio 45202
<PAGE> 76
70
Attn: General Counsel
Fax: (513) 632-5512
(e) if given to any 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 delivered on the date of such
refusal or inability to deliver.
Section 13.2 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.
Section 13.3 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 in a manner consistent with
such classification.
Section 13.4 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 13.5 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 13.6 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 13.7 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
<PAGE> 77
71
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.
Section 13.8 Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Declaration or in any suit against any Trustee for any action taken or omitted
by it as a Trustee, a court in its discretion may require the filing by any
party litigant in the suit of an undertaking to pay the costs of the suit, and
the court in its discretion may assess reasonable costs, including reasonable
attorney's fees and expenses, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section 13.8 does not apply to a suit by a Trustee, a suit by a
Holder to enforce its right to payment or a suit by Holders of more than 10% in
Liquidation Amount of the then outstanding Securities.
<PAGE> 78
IN WITNESS WHEREOF, the undersigned have caused these presents to be
executed as of the day and year first above written.
STAR BANC CORPORATION,
as Sponsor and Common Securities Holder
By: /s/ Jennie P. Carlson
-----------------------------------
Name: Jennie P. Carlson
Title: SVP, General Counsel and Secretary
THE FIRST NATIONAL BANK OF CHICAGO,
as Property Trustee
By: /s/ John R. Prendiville
-----------------------------------
Name: John R. Prendiville
Title: Vice President
FIRST CHICAGO DELAWARE INC.,
as Delaware Trustee
By: /s/ John R. Prendiville
-----------------------------------
Name: John R. Prendiville
Title: Vice President
James D. Hogan, as Regular Trustee
/s/ James D. Hogan
-------------------------------------
Bruce Barnes, as Regular Trustee
/s/ Bruce Barnes
_____________________________________
Jennie P. Carlson, as Regular Trustee
/s / Jennie P. Carlson
_____________________________________
<PAGE> 79
EXHIBIT A
[If the Capital Security is to be represented by a Global Security,
INSERT:
This Capital Security is a Global Certificate within the meaning of
the Declaration hereinafter referred to and is registered in the name of The
Depository Trust Company, a New York corporation (the "Depository"), or a
nominee of the Depository. This Capital Security is exchangeable for Capital
Securities registered in the name of a person other than the Depository 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 Depository to a nominee of the Depository or by a
nominee of the Depository to the Depository or another nominee of the
Depository) may be registered except in limited circumstances.
Unless this Capital Security Certificate is presented by an
authorized representative of the Depository to Star Capital I or its agent for
registration of transfer, exchange or payment, and any Capital Security
Certificate issued is registered in the name of Cede & Co. or such other name as
registered by an authorized representative of the Depository (and any payment
hereon is made to Cede & Co. or to such other entity as is requested by an
authorized representative of the Depository), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the
registered owner hereof, Cede & Co., has an interest herein.]
CERTIFICATE NO. ___ NUMBER OF CAPITAL SECURITIES: _______
CUSIP NO. ______ [IF ANY]
CERTIFICATE EVIDENCING CAPITAL SECURITIES
OF
STAR CAPITAL I
FLOATING RATE CAPITAL SECURITIES
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
Star Capital I, a statutory business trust formed under the laws of
the State of Delaware (the "Trust"), hereby certifies that [Cede & Co.][Name of
definitive owner] (the "Holder") is the registered owner of _______ capital
securities (with an aggregate liquidation amount of $__________) of the Trust
representing undivided beneficial ownership 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 as provided in the Declaration (as defined below). 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 June 8, 1997 (as the same may be
amended from time to time, the "Declaration"), among Star Banc Corporation, as
Sponsor (the "Company"), James D. Hogan, Bruce E. Barnes and Jennie P. Carlson,
as Regular Trustees, The First National Bank of Chicago, as Property Trustee,
and First Chicago Delaware Inc., as Delaware Trustee. Capitalized terms used
herein but not defined shall have the meaning given them in the Declaration. The
Holder is entitled to the benefits of the Guarantee to the extent described
<PAGE> 80
2
therein. The Sponsor will provide a copy of the Declaration, the Guarantee and
the Indenture to a Holder without charge upon written request to the Sponsor 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.
By acceptance, the Holder agrees to treat, for all United States tax
purposes, the Debentures as indebtedness and the Capital Securities as evidence
of undivided indirect beneficial ownership interests in the Debentures.
<PAGE> 81
3
IN WITNESS WHEREOF, the Trust has executed this certificate this
____ day of ____________, 199_.
STAR CAPITAL I
By:_____________________________________
Name:
Title:
This is one of the Securities referred to in the within-mentioned
Declaration.
THE FIRST NATIONAL BANK OF
CHICAGO
By:_____________________________________
Authorized Officer
<PAGE> 82
4
In connection with any transfer of this Security occurring prior to
the date which is the earlier of (i) the date of the declaration by the
Commission of the effectiveness of a registration statement under the Securities
Act covering resales of this Security (which effectiveness shall not have been
suspended or terminated at the date of the transfer) and (ii) two years after
the later of the date of original issue and the last date on which the Trust or
any affiliate of the Trust was the owner of such Capital Securities (or any
predecessor thereto) (the "Resale Restriction Termination Date"), the
undersigned confirms that it has not utilized any general solicitation or
general advertising in connection with the transfer and that such transfer is
being made:
[CHECK ONE]
(1) ___ to the Trust or a subsidiary thereof; or
(2) ___ pursuant to and in compliance with Rule 144A under the Securities
Act of 1933, as amended; or
(3) ___ outside the United States to a "foreign person" in compliance with
Rule 904 of Regulation S under the Securities Act of 1933, as
amended; or
(4) ___ pursuant to the exemption from registration provided by Rule 144
under the Securities Act of 1933, as amended; or
(5) ___ pursuant to an effective registration statement under the Securities
Act of 1933, as amended; or
(6) ___ pursuant to another available exemption from the registration
requirements of the Securities Act of 1933, as amended.
Unless one of the boxes is checked, the Property Trustee will refuse to register
any of the Securities evidenced by this certificate in the name of any person
other than the registered Holder thereof; provided, however, that if box (3),
(4) or (6) is checked, the Trust or the Property Trustee may require, prior to
registering any such transfer of the Securities, in its sole discretion, such
written legal opinions, certifications (including an investment letter in the
case of box (3) and other information as the Property Trustee or the Trust may
reasonably request to confirm that such transfer is being made pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act of 1933, as amended.
If none of the foregoing boxes is checked, the Property Trustee shall not be
obligated to register this Security in the name of any person other than the
Holder hereof unless and until the conditions to any such transfer of
registration set forth herein and in the Declaration shall have been satisfied.
<PAGE> 83
5
Dated: __________________ Signed:________________________________
(Sign exactly as name appears on the
other side of this Security)
Signature Guarantee:_____________________________
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing this
Security for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act
and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Trust and the
Company as the undersigned has requested pursuant to Rule 144A and that it is
aware that the transferor is relying upon the undersigned's foregoing
representations in order to claim the exemption from registration provided by
Rule 144A.
Dated: ________ ______________________________________________
NOTICE: To be executed by an executive officer
<PAGE> 84
EXHIBIT B
THIS CERTIFICATE IS NOT TRANSFERABLE
CERTIFICATE NO. _ NUMBER OF COMMON SECURITIES: ______
CERTIFICATE EVIDENCING COMMON SECURITIES
OF
STAR CAPITAL I
COMMON SECURITIES
(LIQUIDATION AMOUNT $1,000 PER COMMON SECURITY)
Star Capital I, a statutory business trust formed under the laws of
the State of Delaware (the "Trust"), hereby certifies that Star Banc Corporation
(the "Holder") is the registered owner of common securities of the Trust
representing an undivided beneficial ownership interest 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 and any attempted transfer thereof shall be void. 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 June 8, 1997 (as the same may be amended from time to
time, the "Declaration"), among Star Banc Corporation, as Sponsor, James D.
Hogan, Bruce E. Barnes and Jennie P. Carlson, as Regular Trustees, The First
National Bank of Chicago, as Property Trustee and First Chicago Delaware Inc.,
as Delaware Trustee. The Holder is entitled to the benefits of the Guarantee to
the extent described therein. Capitalized terms used herein but not defined
shall have the meaning given them in the Declaration. The Sponsor will provide a
copy of the Declaration, the Guarantee and the Indenture to a Holder without
charge upon written request to the Sponsor 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.
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 an undivided indirect beneficial ownership interest in the
Debentures.
<PAGE> 85
2
IN WITNESS WHEREOF, the Trust has executed this certificate this __
day of _____________, 199_.
STAR CAPITAL I
By:____________________________________
Name:
Title:
<PAGE> 1
EXHIBIT 4.6
GUARANTEE AGREEMENT
STAR CAPITAL I
DATED AS OF JUNE 8, 1997
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
ARTICLE 1
INTERPRETATION AND DEFINITIONS........................................ 1
SECTION 1.1 Interpretation and Definitions............................................................ 1
ARTICLE 2
TRUST INDENTURE ACT............................................. 4
SECTION 2.1 Trust Indenture Act; Application.......................................................... 4
SECTION 2.2 Lists of Holders of Securities............................................................ 5
SECTION 2.3 Reports by Guarantee Trustee.............................................................. 5
SECTION 2.4 Periodic Reports to Guarantee Trustee..................................................... 5
SECTION 2.5 Evidence of Compliance with Conditions Precedent.......................................... 5
SECTION 2.6 Guarantee Event of Default; Waiver........................................................ 5
SECTION 2.7 Guarantee Event of Default; Notice........................................................ 5
SECTION 2.8 Conflicting Interests..................................................................... 6
SECTION 2.9 Disclosure of Information................................................................. 6
SECTION 2.10 Guarantee Trustee May File Proofs of Claim............................................... 6
ARTICLE 3
POWERS, DUTIES AND RIGHTS OF
GUARANTEE TRUSTEE.............................................. 6
SECTION 3.1 Powers and Duties of Guarantee Trustee.................................................... 6
SECTION 3.2 Certain Rights of Guarantee Trustee....................................................... 8
SECTION 3.3 Not Responsible for Recitals or Issuance of Guarantee..................................... 10
ARTICLE 4
GUARANTEE TRUSTEE.............................................. 10
SECTION 4.1 Guarantee Trustee; Eligibility............................................................ 10
SECTION 4.2 Appointment, Removal and Resignation of Guarantee Trustee................................. 11
ARTICLE 5
GUARANTEE.................................................. 12
SECTION 5.1 Guarantee................................................................................. 12
SECTION 5.2 Waiver of Notice and Demand............................................................... 12
SECTION 5.3 Obligations Not Affected.................................................................. 12
SECTION 5.4 Rights of Holders......................................................................... 13
SECTION 5.5 Guarantee of Payment...................................................................... 14
SECTION 5.6 Subrogation............................................................................... 14
SECTION 5.7 Independent Obligations................................................................... 14
</TABLE>
-i-
<PAGE> 3
<TABLE>
<CAPTION>
Page
----
ARTICLE 6
LIMITATION OF TRANSACTIONS; SUBORDINATION.................................. 14
<S> <C>
SECTION 6.1 Limitation of Transactions................................................................ 14
SECTION 6.2 Ranking................................................................................... 15
ARTICLE 7
TERMINATION................................................. 15
SECTION 7.1 Termination............................................................................... 15
ARTICLE 8
INDEMNIFICATION............................................... 16
SECTION 8.1 Exculpation............................................................................... 16
SECTION 8.2 Indemnification........................................................................... 16
ARTICLE 9
MISCELLANEOUS................................................ 16
SECTION 9.1 Successors and Assigns.................................................................... 16
SECTION 9.2 Amendments................................................................................ 17
SECTION 9.3 Notices................................................................................... 17
SECTION 9.4 Benefit................................................................................... 18
SECTION 9.5 Governing Law............................................................................. 18
</TABLE>
-ii-
<PAGE> 4
CROSS REFERENCE TABLE*
<TABLE>
<CAPTION>
Section of Trust
Indenture Act of Section of
1939, as amended Agreement
<S> <C>
310(a).......................................................................................................4.1(a)
310(b).......................................................................................................4.1(c)
310(c).................................................................................................Inapplicable
311(a).......................................................................................................2.2(b)
311(b).......................................................................................................2.2(b)
311(c).................................................................................................Inapplicable
312(a).......................................................................................................2.2(a)
312(b).......................................................................................................2.2(b)
312(c)..........................................................................................................2.9
313(a)..........................................................................................................2.3
313(b)..........................................................................................................2.3
313(c)..........................................................................................................2.3
313(d)..........................................................................................................2.3
314(a)..........................................................................................................2.4
314(b).................................................................................................Inapplicable
314(c)..........................................................................................................2.5
314(d).................................................................................................Inapplicable
314(e)..........................................................................................................2.5
314(f).................................................................................................Inapplicable
315(a)...............................................................................................3.1(d); 3.2(a)
315(b).......................................................................................................2.7(a)
315(c).......................................................................................................3.1(c)
315(d).......................................................................................................3.1(d)
316(a)..................................................................................................2.6; 5.4(a)
317(a)....................................................................................................2.10; 5.4
318(a).......................................................................................................2.1(b)
</TABLE>
- ------------------
* This Cross-Reference Table does not constitute part of the Agreement
and shall not have any bearing upon the interpretation of any of its
terms or provisions.
<PAGE> 5
GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT (the "Guarantee"), dated as of June
8, 1997, is executed and delivered by Star Banc Corporation, an Ohio corporation
(the "Guarantor"), and The First National Bank of Chicago, a national banking
association, as trustee (the "Guarantee Trustee"), for the benefit of the
Holders (as defined herein) of the Securities (as defined herein) of Star
Capital I, a Delaware statutory business trust (the "Trust").
W I T N E S S E T H :
WHEREAS, pursuant to the Declaration (as defined herein), the
Trust is issuing on the date hereof, and may in the future issue additional,
capital securities, having a liquidation amount of $1,000 per capital security,
designated the Floating Rate Capital Securities (the "Capital Securities") and
common securities, having a liquidation amount of $1,000 per common security,
designated the Floating Rate Common Securities (the "Common Securities";
together with the Capital Securities, the "Securities");
WHEREAS, as incentive for the Holders to purchase the
Securities, the Guarantor desires irrevocably and unconditionally to agree, to
the extent set forth in this Guarantee, to pay to the Holders of the Securities
the Guarantee Payments (as defined herein) and to make certain other payments on
the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the purchase by each
Holder of Securities, which purchase the Guarantor hereby agrees shall benefit
the Guarantor, the Guarantor executes and delivers this Guarantee for the
benefit of the Holders.
ARTICLE 1
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Interpretation and Definitions. In this Guarantee,
unless the context otherwise requires:
(a) capitalized terms used in this Guarantee 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 Guarantee has the same
meaning throughout;
(c) all references to "the Guarantee" or "this Guarantee" are
to this Guarantee as modified, supplemented or amended from time to
time;
<PAGE> 6
2
(d) all references in this Guarantee to Articles and Sections
are to Articles and Sections of this Guarantee, unless otherwise
specified;
(e) a term defined in the Trust Indenture Act has the same
meaning when used in this Guarantee, unless otherwise defined in this
Guarantee or unless the context otherwise requires; and
(f) a reference to the singular includes the plural and vice
versa and a reference to the masculine includes, as applicable, the
feminine.
"Affiliate" has the same meaning as given to that term in Rule
405 of the Securities Act of 1933, as amended, or any successor rule thereunder.
"Business Day" has the meaning given to such term in the
Indenture.
"Corporate Trust Office" means the office of the Guarantee
Trustee at which the corporate trust business of the Guarantee Trustee shall at
any particular time, be principally administered, which office at the date of
execution of this Guarantee is located at The First National Bank of Chicago,
One First National Plaza, Suite 0126, Chicago, Illinois 60670-0126, Attention:
Corporate Trust Services.
"Covered Person" means any Holder or beneficial owner of
Securities.
"Debentures" means the series of junior subordinated
debentures to be issued, in one or more issuances, by the Guarantor, designated
the Floating Rate Junior Subordinated Debentures due 2027, held by the Property
Trustee (as defined in the Declaration) of the Trust.
"Declaration" means the Amended and Restated Declaration of
Trust, dated as of June 8, 1997, as amended, modified or supplemented from time
to time, among the trustees of the Trust named therein, the Guarantor, as
sponsor, and the holders from time to time of undivided beneficial ownership
interests in the assets of the Trust.
"Guarantee Event of Default" means a default by the Guarantor
on any of its payment or other obligations under this Guarantee.
"Guarantee Trustee" means The First National Bank of Chicago,
until a successor Guarantee Trustee has been appointed and has accepted such
appointment pursuant to the terms of this Guarantee and thereafter means each
such Successor Guarantee Trustee.
"Guarantee Payments" means the following payments or
distributions, without duplication, with respect to the Securities, to the
extent not paid or made by the Trust: (i) any accumulated and unpaid
Distributions (as defined in the Declaration) that are required to be paid on
such Securities to the extent the Trust shall have sufficient funds available
therefor at the time, (ii) the redemption price, including all accrued and
unpaid Distributions to the date of redemption with respect to any Securities
called for redemption by the Trust, to the extent
<PAGE> 7
3
the Trust shall have sufficient funds available therefor at the time, and (iii)
upon a voluntary or involuntary dissolution, winding-up or termination of the
Trust (other than in connection with the distribution of Debentures to the
Holders in exchange for Securities as provided in the Declaration), the lesser
of (a) the aggregate of the liquidation amount and all accrued and unpaid
Distributions on the Securities to the date of payment, and (b) the amount of
assets of the Trust remaining available for distribution to Holders in
liquidation of the Trust (in either case, the "Liquidation Distribution"). If a
Trust Enforcement Event (as defined in the Declaration) has occurred and is
continuing, the rights of holders of the Common Securities to receive Guarantee
Payments under this Guarantee are subordinated to the rights of Holders of the
Capital Securities to receive payments hereunder.
"Holder" shall mean any holder of Securities, as registered on
the books and records of the Trust; 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 or any other obligor on the Capital
Securities; and provided further, that in determining whether the Holders of the
requisite liquidation amount of Capital Securities have voted on any matter
provided for in this Guarantee, then for the purpose of such determination only
(and not for any other purpose hereunder), if the Capital Securities remain in
the form of one or more Global Certificates (as defined in the Declaration), the
term "Holders" shall mean the holder of the Global Certificate acting at the
direction of the beneficial holders of the securities.
"Indemnified Person" means the Guarantee Trustee, any
Affiliate of the Guarantee Trustee, and any officers, directors, shareholders,
members, partners, employees, representatives, nominees, custodians or agents of
the Guarantee Trustee.
"Indenture" means the Indenture, dated as of June 8, 1997,
among the Guarantor and The First National Bank of Chicago, as trustee, and any
indenture supplemental thereto pursuant to which the Debentures are to be issued
to the Property Trustee (as defined in the Declaration) of the Trust.
"Majority in Liquidation Amount of the Securities" means,
except as provided in the terms of the Securities or by the Trust Indenture Act,
Holder(s) of outstanding Securities, voting separately as a class, who are the
record holders of more than 50% 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. In determining
whether the Holders of the requisite amount of Securities have voted, Securities
which are owned by the Guarantor or any Affiliate of the Guarantor shall be
disregarded for the purpose of any such determination.
"Officers' Certificate" means, with respect to any Person, a
certificate signed on behalf of such Person by two Authorized Officers (as
defined in the Declaration) of such Person. Any Officers' Certificate delivered
with respect to compliance with a condition or covenant provided for in this
Guarantee shall include:
<PAGE> 8
4
(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 on behalf of such Person to express an
informed opinion as to whether or not such covenant or condition has
been complied with; and
(c) a statement as to whether, in the opinion of each such
officer acting on behalf of such Person, such condition or covenant has
been complied with.
"Outstanding" has the meaning given to such term in the
Indenture.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Responsible Officer" means, with respect to the Guarantee
Trustee, any officer within the Corporate Trust Office of the Guarantee Trustee,
including any vice president, any assistant vice president, the secretary, any
assistant secretary, the treasurer, any assistant treasurer or other officer of
the Corporate Trust Office of the 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 Guarantee Trustee" means a successor Guarantee
Trustee possessing the qualifications to act as Guarantee Trustee under Section
4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended from time to time, or any successor legislation.
ARTICLE 2
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application. (a) This
Guarantee is subject to the provisions of the Trust Indenture Act that are
required to be part of this Guarantee and shall, to the extent applicable, be
governed by such provisions.
(b) If and to the extent that any provision of this Guarantee
limits, qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.
<PAGE> 9
5
SECTION 2.2 Lists of Holders of Securities. (a) The Guarantor
shall provide the Guarantee Trustee with a list, in such form as the Guarantee
Trustee may reasonably require, of the names and addresses of the Holders of the
Securities ("List of Holders"), (i) semi-annually, not later than June 30 and
December 31 of each year and current as of such date, and (ii) at such other
times as the Guarantee Trustee may request in writing, within 30 days of receipt
by the Guarantor of a written request from the Guarantee Trustee for a List of
Holders as of a date no more than 15 days before such List of Holders is given
to the Guarantee Trustee; excluding from any such list names and addresses
received by the Guarantee Trustee in its capacity as Security Registrar (as
defined in the Indenture). The Guarantee Trustee shall preserve, in as current a
form as is reasonably practicable, all information contained in Lists of Holders
given to it, provided that it may destroy any List of Holders previously given
to it on receipt of a new List of Holders.
(b) The Guarantee Trustee shall comply with its obligations
under Sections 311(a), 311(b) and 312(b) of the Trust Indenture Act.
SECTION 2.3 Reports by Guarantee Trustee. Within 60 days after
May 15 of each year (commencing with the year of the issuance of the
Securities), the Guarantee Trustee shall provide to the Holders of the
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 Guarantee Trustee shall also comply with the requirements of
Section 313(d) of the Trust Indenture Act.
SECTION 2.4 Periodic Reports to Guarantee Trustee. The
Guarantor shall provide to the 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 required by Section 314 of the Trust
Indenture Act.
SECTION 2.5 Evidence of Compliance with Conditions Precedent.
The Guarantor shall provide to the Guarantee Trustee such evidence of compliance
with any conditions precedent, if any, provided for in this 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 Guarantee Event of Default; Waiver. The Holders of
a Majority in Liquidation Amount of the Securities may, by vote or written
consent, on behalf of the Holders of all of the Securities, waive any past
Guarantee Event of Default and its consequences. Upon such waiver, any such
Guarantee Event of Default shall cease to exist, and any Guarantee Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Guarantee, but no such waiver shall extend to any subsequent or other
default or Guarantee Event of Default or impair any right consequent thereon.
SECTION 2.7 Guarantee Event of Default; Notice. (a) The
Guarantee Trustee shall, within 90 days after the occurrence of a Guarantee
Event of Default actually
<PAGE> 10
6
known to a Responsible Officer of the Guarantee Trustee, transmit by mail, first
class postage prepaid, to the Holders of the Securities, notices of all such
Guarantee Events of Default, unless such defaults have been cured before the
giving of such notice; provided, that the Guarantee Trustee shall be protected
in withholding such notice if and so long as a Responsible Officer of the
Guarantee Trustee in good faith determines that the withholding of such notice
is in the interests of the Holders of the Securities.
(b) The Guarantee Trustee shall not be deemed to have
knowledge of any Guarantee Event of Default unless the Guarantee Trustee shall
have received written notice thereof or a Responsible Officer of the Guarantee
Trustee charged with the administration of the Declaration shall have obtained
actual knowledge thereof.
SECTION 2.8 Conflicting Interests. The Declaration shall be
deemed to be specifically described in this Guarantee for the purposes of clause
(i) of the first provision contained in Section 310(b) of the Trust Indenture
Act.
SECTION 2.9 Disclosure of Information. The disclosure of
information as to the names and addresses of the Holders of the Securities in
accordance with Section 312 of the Trust Indenture Act, regardless of the source
from which such information was derived, shall not be deemed to be a violation
of any existing law, or any law hereafter enacted which does not specifically
refer to Section 312 of the Trust Indenture Act, nor shall the Guarantee Trustee
be held accountable by reason of mailing any material pursuant to a request made
under Section 312(b) of the Trust Indenture Act.
SECTION 2.10 Guarantee Trustee May File Proofs of Claim. Upon
the occurrence of a Guarantee Event of Default, the Guarantee Trustee is hereby
authorized to (a) recover judgment, in its own name and as trustee of an express
trust, against the Guarantor for the whole amount of any Guarantee Payments
remaining unpaid and (b) file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have its claims and those of the
Holders of the Securities allowed in any judicial proceedings relative to the
Guarantor, its creditors or its property.
ARTICLE 3
POWERS, DUTIES AND RIGHTS OF
GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of Guarantee Trustee.
(a) This Guarantee shall be held by the Guarantee Trustee on
behalf of the Trust for the benefit of the Holders of the Securities, and the
Guarantee Trustee shall not transfer this Guarantee to any Person except a
Holder of Securities exercising his or her rights pursuant to Section 5.4(b) or
to a Successor Guarantee Trustee on acceptance by such Successor Guarantee
Trustee. The right, title and interest of the Guarantee Trustee in and to this
Guarantee shall automatically vest in any Successor Guarantee Trustee, and such
vesting
<PAGE> 11
7
and succession of title shall be effective whether or not conveyancing documents
have been executed and delivered pursuant to the appointment of such Successor
Guarantee Trustee.
(b) If a Guarantee Event of Default actually known to a
Responsible Officer of the Guarantee Trustee has occurred and is continuing, the
Guarantee Trustee shall enforce this Guarantee for the benefit of the Holders of
the Securities.
(c) The Guarantee Trustee, before the occurrence of any
Guarantee Event of Default and after the curing of all Guarantee Events of
Default that may have occurred, shall undertake to perform only such duties as
are specifically set forth in this Guarantee, and no implied covenants shall be
read into this Guarantee against the Guarantee Trustee. In case a Guarantee
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 Guarantee
Trustee, the Guarantee Trustee shall exercise such of the rights and powers
vested in it by this 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 Guarantee shall be construed to
relieve the Guarantee Trustee from liability for its own negligent action, its
own negligent failure to act, or its own willful misconduct, except that:
(i) prior to the occurrence of any Guarantee
Event of Default and after the curing or waiving of all such
Guarantee Events of Default that may have occurred:
(A) the duties and obligations of the
Guarantee Trustee shall be determined solely by the
express provisions of this Guarantee, and the
Guarantee Trustee shall not be liable except for the
performance of such duties and obligations as are
specifically set forth in this Guarantee, and no
implied covenants or obligations shall be read into
this Guarantee against the Guarantee Trustee; and
(B) in the absence of bad faith on the part
of the Guarantee Trustee, the Guarantee Trustee may
conclusively rely, as to the truth of the statements
and the correctness of the opinions expressed
therein, upon any certificates or opinions furnished
to the Guarantee Trustee and conforming to the
requirements of this Guarantee; but in the case of
any such certificates or opinions that by any
provision hereof are specifically required to be
furnished to the Guarantee Trustee, the Guarantee
Trustee shall be under a duty to examine the same to
determine whether or not they conform to the
requirements of this Guarantee;
(ii) the Guarantee Trustee shall not be
liable for any error of judgment made in good faith by a
Responsible Officer of the Guarantee
<PAGE> 12
8
Trustee, unless it shall be proved that the Guarantee Trustee
was negligent in ascertaining the pertinent facts upon which
such judgment was made;
(iii) the Guarantee Trustee shall not be liable
with respect to any action taken or omitted to be taken by it
in good faith in accordance with the direction of the Holders
of not less than a Majority in Liquidation Amount of the
Securities relating to the time, method and place of
conducting any proceeding for any remedy available to the
Guarantee Trustee, or exercising any trust or power conferred
upon the Guarantee Trustee under this Guarantee; and
(iv) no provision of this Guarantee shall
require the Guarantee Trustee to expend or risk its own funds
or otherwise incur personal financial liability in the
performance of any of its duties or in the exercise of any of
its rights or powers, if the Guarantee Trustee shall have
reasonable grounds for believing that the repayment of such
funds or liability is not reasonably assured to it under the
terms of this Guarantee or indemnify, reasonably satisfactory
to the Guarantee Trustee, against such risk or liability is
not reasonably assured to it.
SECTION 3.2 Certain Rights of Guarantee Trustee. (a) Subject
to the provisions of Section 3.1:
(i) The Guarantee Trustee may 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 Guarantor
contemplated by this Guarantee shall be sufficiently evidenced
by an Officers' Certificate;
(iii) Whenever, in the administration of this
Guarantee, the Guarantee Trustee shall deem it desirable that
a matter be proved or established before taking, suffering or
omitting any action hereunder, the Guarantee Trustee (unless
other evidence is herein specifically prescribed) may, in the
absence of bad faith on its part, request and conclusively
rely upon an Officers' Certificate which, upon receipt of such
request, shall be promptly delivered by the Guarantor;
(iv) The Guarantee Trustee shall have no duty
to see to any recording, filing or registration or any
instrument (or any rerecording, refiling or registration
thereof);
<PAGE> 13
9
(v) The Guarantee Trustee may consult with
counsel, 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 Guarantee Trustee shall have
the right at any time to seek instructions concerning the
administration of this Guarantee from any court of competent
jurisdiction;
(vi) The Guarantee Trustee shall be under no
obligation to exercise any of the rights or powers vested in
it by this Guarantee at the request or direction of any
Holder, unless such Holder shall have provided to the
Guarantee Trustee such security and indemnity, reasonably
satisfactory to the Guarantee Trustee, against the costs,
expenses (including attorneys' fees and expenses and the
expenses of the Guarantee 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 Guarantee
Trustee; provided, that nothing contained in this Section
3.2(a)(vi) shall be taken to relieve the Guarantee Trustee,
upon the occurrence of a Guarantee Event of Default, of its
obligation to exercise the rights and powers vested in it by
this Guarantee;
(vii) The Guarantee Trustee shall not be bound
to make any investigation into the facts or matters stated in
any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper
or document, but the Guarantee Trustee, in its discretion, may
make such further inquiry or investigation into such facts or
matters as it may see fit;
(viii) The 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 Guarantee 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 Guarantee Trustee
or its agents hereunder shall bind the Holders of the
Securities, and the signature of the 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 Guarantee Trustee to so act or as to its
compliance with any of the terms and provisions of this
Guarantee, both of which shall be conclusively evidenced by
the Guarantee Trustee's or its agent's taking such action; and
(x) Whenever in the administration of this
Guarantee the Guarantee Trustee shall deem it desirable to
receive instructions with respect to enforcing any remedy or
right or taking any other action hereunder, the Guarantee
<PAGE> 14
10
Trustee (i) may request instructions from the Holders of a
Majority in Liquidation Amount of the 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.
(b) No provision of this Guarantee shall be deemed to impose
any duty or obligation on the Guarantee Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it in any
jurisdiction in which it shall be illegal, or in which the Guarantee Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Guarantee Trustee
shall be construed to be a duty.
SECTION 3.3 Not Responsible for Recitals or Issuance of
Guarantee. The recitals contained in this Guarantee shall be taken as the
statements of the Guarantor, and the Guarantee Trustee does not assume any
responsibility for their correctness. The Guarantee Trustee makes no
representations as to the validity or sufficiency of this Guarantee.
ARTICLE 4
GUARANTEE TRUSTEE
SECTION 4.1 Guarantee Trustee; Eligibility.
(a) There shall be at all times a 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 Exchange
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 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.
<PAGE> 15
11
(b) If at any time the Guarantee Trustee shall cease to be
eligible to so act under Section 4.1(a), the Guarantee Trustee shall immediately
resign in the manner and with the effect set out in Section 4.2(b).
(c) If the Guarantee Trustee has or shall acquire any
"conflicting interest" within the meaning of Section 310(b) of the Trust
Indenture Act, the Guarantee Trustee and Guarantor shall in all respects comply
with the provisions of Section 310(b) of the Trust Indenture Act.
SECTION 4.2 Appointment, Removal and Resignation of Guarantee
Trustee.
(a) Subject to Section 4.1(b), the Guarantee Trustee may be
appointed or removed with or without cause at any time by the Guarantor. No
resignation or removal of the Guarantee Trustee and no appointment of a
Successor Guarantee Trustee pursuant to this Article shall become effective
until the acceptance of appointment by the Successor Guarantee Trustee by
written instrument executed by the Successor Guarantee Trustee and delivered to
the Holders and the Guarantee Trustee.
(b) Subject to the immediately preceding paragraph, a
Guarantee Trustee may resign at any time by giving written notice thereof to the
Holders and the Guarantor.
(c) If no Successor Guarantee Trustee shall have been
appointed and accepted appointment as provided in this Section 4.2 within 30
days after delivery to the Guarantor of an instrument of removal or resignation,
the removed or resigning Guarantee Trustee may petition any court of competent
jurisdiction for the appointment of a Successor Guarantee Trustee. Such court
may thereupon, after prescribing such notice, if any, as it may deem proper,
appoint a Successor Guarantee Trustee.
(d) No Guarantee Trustee shall be liable for the acts or
omissions to act of any Successor Guarantee Trustee.
(e) Upon termination of this Guarantee or removal or
resignation of the Guarantee Trustee pursuant to this Section 4.2, the Guarantor
shall pay to the Guarantee Trustee all amounts owing for fees and reimbursement
of expenses which have accrued to the date of such termination, removal or
resignation.
(f) The Guarantor shall promptly notify the Holders of the
resignation, removal or appointment of the Guarantee Trustee.
<PAGE> 16
12
ARTICLE 5
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 Trust), as and when due, regardless of any defense,
right of set-off or counterclaim that the Trust 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 Trust to pay such amounts to the Holders.
SECTION 5.2 Waiver of Notice and Demand.
The Guarantor hereby waives notice of acceptance of this
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 Trust 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. Notwithstanding anything to the contrary herein, the Guarantor retains
all of its rights under the Indenture to extend the interest payment period on
the Debentures and the Guarantor shall not be obligated hereunder to make any
Guarantee Payments during any Extension Period (as defined in the Indenture)
with respect to the Distributions (as defined in the Declaration) on the
Securities.
SECTION 5.3 Obligations Not Affected.
The obligations, covenants, agreements and duties of the
Guarantor under this Guarantee shall be absolute and unconditional and shall
remain in full force and effect until the entire liquidation amount of all
outstanding Securities shall have been paid and such obligation shall in no way
be affected or impaired by reason of the happening from time to time of any
event, including without limitation, the following, whether or not with notice
to, or the consent of, the Guarantor:
(a) The release or waiver, by operation of law or otherwise,
of the performance or observance by the Trust of any express or implied
agreement, covenant, term or condition relating to the Securities to be
performed or observed by the Trust;
(b) The extension of time for the payment by the Trust of all
or any portion of the Distributions, Redemption Price (as defined in
the Indenture), Liquidation Distribution or any other sums payable
under the terms of the Securities or the extension of time for the
performance of any other obligation under, arising out of, or in
connection with the Securities (other than an extension 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);
<PAGE> 17
13
(c) Any failure, omission, delay or lack of diligence on the
part of the Property Trustee or the Holders to enforce, assert or
exercise any right, privilege, power or remedy conferred on the
Property Trustee or the Holders pursuant to the terms of the
Securities, or any action on the part of the Trust granting indulgence
or extension of any kind;
(d) The voluntary or involuntary liquidation, dissolution,
sale of any collateral, receivership, insolvency, bankruptcy,
assignment for the benefit of creditors, reorganization, arrangement,
composition or readjustment of debt of, or other similar proceedings
affecting, the Trust or any of the assets of the Trust;
(e) Any invalidity of, or defect or deficiency in, the
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 hereunder shall be absolute and unconditional under any and
all circumstances.
There shall be no obligation of the Guarantee Trustee or the
Holders to give notice to, or obtain consent of, the Guarantor or any other
Person with respect to the happening of any of the foregoing.
No setoff, counterclaim, reduction or diminution of any
obligation, or any defense of any kind or nature that the Guarantor has or may
have against any Holder shall be available hereunder to the Guarantor against
such Holder to reduce the payments to it under this Guarantee.
SECTION 5.4 Rights of Holders.
(a) The Holders of a Majority in Liquidation Amount of the
Securities have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Guarantee Trustee in respect of this
Guarantee or exercising any trust or power conferred upon the Guarantee Trustee
under this Guarantee.
(b) If the Guarantee Trustee fails to enforce this Guarantee,
then any Holder of Securities may, subject to the subordination provisions of
Section 6.2, institute a legal proceeding directly against the Guarantor to
enforce the Guarantee Trustee's rights under this Guarantee without first
instituting a legal proceeding against the Trust, the Guarantee Trustee or any
other person or entity. Notwithstanding the foregoing, if the Guarantor has
failed to make a Guarantee Payment, a Holder of Securities may, subject to the
subordination provisions of Section 6.2, directly institute a proceeding against
the Guarantor for enforcement of the Guarantee for such payment to the Holder of
the Securities of the principal of or interest on the Debentures on or after the
respective due dates specified in the
<PAGE> 18
14
Debentures, and the amount of the payment will be based on the Holder's pro rata
share of the amount due and owing on all of the Securities. The Guarantor hereby
waives any right or remedy to require that any action on this Guarantee be
brought first against the Trust or any other person or entity before proceeding
directly against the Guarantor.
SECTION 5.5 Guarantee of Payment.
This 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 Securities against the Trust in respect of any amounts paid to
such Holders by the Guarantor under this Guarantee; provided, however, that the
Guarantor shall not (except to the extent required by mandatory provisions of
law) be entitled to enforce or exercise any right that it may acquire by way of
subrogation of any indemnity, reimbursement or other agreement, in all cases as
a result of payment under this Guarantee, if at the time of any such payment,
any amounts are due and unpaid under this 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
Guarantee Trustee for the benefit of the Holders.
SECTION 5.7 Independent Obligations.
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Trust with respect to the Securities, and
that the Guarantor shall be liable as principal and as debtor hereunder to make
Guarantee Payments pursuant to the terms of this Guarantee notwithstanding the
occurrence of any event referred to in subsections 5.3(a) through 5.3(g),
inclusive, hereof.
ARTICLE 6
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions.
So long as any Securities remain outstanding, if there shall
have occurred a Guarantee Event of Default or a Trust Enforcement Event, then
the Guarantor shall not, and shall not permit any subsidiary of the Guarantor,
to (i) declare or pay any dividends or distributions on, or redeem, purchase,
acquire, or make a liquidation payment with respect to, the Guarantor's capital
stock or (ii) make any payment of principal, interest or premium, if any, on or
repay, repurchase or redeem any debt securities of the Guarantor that rank pari
passu with or junior to the Debentures or make any guarantee payments with
respect to any guarantee by the Guarantor of the debt securities of any
subsidiary of the Guarantor if such guarantee ranks pari passu with or junior to
the Debentures (other than (a) repurchases,
<PAGE> 19
15
redemptions or other acquisitions of shares of capital stock of the Guarantor in
connection with any employment contract, benefit plan or other similar
arrangement with or for the benefit of any one or more employees, officers,
directors or consultants or in connection with a dividend reinvestment or
stockholder stock purchase plan, (b) as a result of an exchange or conversion of
any class or series of the Guarantor's capital stock (or any capital stock of a
subsidiary of the Guarantor) for any class or series of the Guarantor's capital
stock or of any class or series of the Guarantor's indebtedness for any class or
series of the Guarantor's capital stock, (c) the purchase of fractional
interests 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, (d) any declaration of a dividend in connection with the adoption of
any stockholder's rights plan, or the issuance of rights, stock or other
property under any stockholder's rights plan, or the redemption or repurchase of
rights pursuant thereto, or (e) any dividend in the form of stock, warrants,
options or other rights where the dividend stock or the stock issuable upon
exercise of such warrants, options or other rights is the same stock as that on
which the dividend is being paid (or pari passu with or junior to such stock).
SECTION 6.2 Ranking.
This Guarantee will constitute an unsecured obligation of the
Guarantor and will rank subordinate and junior in right of payment to all other
liabilities of the Guarantor, except those liabilities of the Guarantor made
pari passu or subordinate by their express terms.
If a Trust Enforcement Event has occurred and is continuing
under the Declaration, the rights of the holders of the Common Securities to
receive Guarantee Payments hereunder shall be subordinated to the rights of the
holders of the Capital Securities to receive payment of all amounts due and
owing hereunder.
ARTICLE 7
TERMINATION
SECTION 7.1 Termination.
This Guarantee shall terminate upon (i) full payment of the
Redemption Price (as defined in the Declaration) of all Securities, (ii) upon
the distribution of the Debentures to the Holders of all the Securities or (iii)
upon full payment of the amounts payable in accordance with the Declaration upon
liquidation of the Trust. Notwithstanding the foregoing, this Guarantee will
continue to be effective or will be reinstated, as the case may be, if at any
time any Holder of Securities must restore payment of any sums paid under the
Securities or under this Guarantee.
<PAGE> 20
16
ARTICLE 8
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
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
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
matter 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 pertinent to the existence and amount of assets from
which Distributions to Holders of 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 any loss, liability 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 provisions of this Section 8.2 shall survive the termination of
this Guarantee or the resignation or removal of the Guarantee Trustee.
ARTICLE 9
MISCELLANEOUS
SECTION 9.1 Successors and Assigns.
All guarantees and agreements contained in this Guarantee
shall bind the successors, assigns, receivers, trustees and representatives of
the Guarantor and shall inure to the benefit of the Holders of the Securities
then outstanding.
<PAGE> 21
17
SECTION 9.2 Amendments.
Except with respect to any changes that do not adversely
affect the rights of the Holders (in which case no consent of the Holders will
be required), this Guarantee may only be amended with the prior approval of the
Holders of at least a Majority in Liquidation Amount of the Securities. The
provisions of Section 12.2 of the Declaration with respect to meetings of, and
action by written consent of, the Holders of the Securities apply to the giving
of such approval.
SECTION 9.3 Notices.
All notices provided for in this Guarantee shall be in
writing, duly signed by the party giving such notice, and shall be delivered,
telecopied or mailed by registered or certified mail, as follows:
(a) If given to the Guarantee Trustee, at the Guarantee
Trustee's mailing address set forth below (or such other address as the
Guarantee Trustee may give notice of to the Guarantor and the Holders
of the Securities):
The First National Bank of Chicago
One First National Plaza, Suite 0126
Chicago, Illinois 60670-0126
Attention: Corporate Trust
Fax: (312) 407-1708
(b) If given to the Guarantor, at the Guarantor's mailing
addresses set forth below (or such other address as the Guarantor may
give notice of to the Guarantee Trustee and the Holders of the
Securities):
Star Banc Corporation
425 Walnut Street
Cincinnati, Ohio 45202
Attn: General Counsel
Fax: (513) 632-5512
(c) If given to any Holder of Securities, 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 delivered
on the date of such refusal or inability to deliver.
<PAGE> 22
18
SECTION 9.4 Benefit.
This Guarantee is solely for the benefit of the Holders of the
Securities and, subject to Section 3.1(a), is not separately transferable from
the Securities.
SECTION 9.5 Governing Law.
THIS GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
<PAGE> 23
IN WITNESS WHEREOF, this Guarantee is executed as of the day
and year first above written.
STAR BANC CORPORATION,
as Guarantor
By: /s/ Bruce Barnes
------------------------------
Name: Bruce Barnes
Title: SVP and Treasurer
THE FIRST NATIONAL BANK OF CHICAGO,
as Guarantee Trustee
By: /s/ John R. Prendiville
------------------------------
Name: John R. Prendiville
Title: Vice President
<PAGE> 1
Exhibit 4.7
REGISTRATION RIGHTS AGREEMENT
Dated as of June 8, 1997
Among
STAR CAPITAL I,
STAR BANC CORPORATION
and
CREDIT SUISSE FIRST BOSTON CORPORATION,
MORGAN STANLEY & CO. INCORPORATED
and
SALOMON BROTHERS INC
as Initial Purchasers
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
1. Definitions............................................................................................ 1
2. Securities Subject to This Agreement................................................................... 3
3. Registered Exchange Offer.............................................................................. 4
4. Shelf Registration..................................................................................... 5
5. Additional Interest and Additional Distributions Under Certain Circumstances........................... 6
6. Registration Procedures................................................................................ 7
7. Registration Expenses.................................................................................. 15
8. Indemnification and Contribution....................................................................... 15
9. Rule 144A.............................................................................................. 18
10. Participation in Underwritten Registrations............................................................ 18
11. Selection of Underwriters.............................................................................. 18
12. Miscellaneous.......................................................................................... 18
</TABLE>
<PAGE> 3
This Registration Rights Agreement (this "Agreement") is made
and entered into as of June 8, 1997 by and among Star Capital I, a Delaware
statutory business trust (the "Trust"), Star Banc Corporation, an Ohio
corporation ("the Company"), and Credit Suisse First Boston Corporation, Morgan
Stanley & Co. Incorporated and Salomon Brothers Inc (together, the "Initial
Purchasers").
This Agreement is entered into in connection with the Purchase
Agreement, dated as of June 5, 1997, among the Company, the Trust and the
Initial Purchasers (the "Purchase Agreement"), and any additional purchase
agreement between such parties, in each case which provides for the sale or
sales by the Trust to the Initial Purchasers of the Trust's Floating Rate
Capital Securities, liquidation amount $1,000 per security (the "Capital
Securities"). The Company will be the owner of all of the beneficial ownership
interest represented by the common securities (the "Common Securities") of the
Trust. The Capital Securities and the Common Securities will be guaranteed by a
guarantee (the "Guarantee") by the Company, to the extent of funds held by the
Trust. Concurrently with the issuance of the Capital Securities and the Common
Securities, the Trust will invest the proceeds of each thereof in the Company's
Floating Rate Junior Subordinated Debentures due 2027 (the "Junior Subordinated
Debentures" and, together with the Capital Securities and the Guarantee, the
"Securities"). In order to induce the Initial Purchasers to enter into the
Purchase Agreement, the Trust and the Company have agreed to provide the
registration rights set forth in this Agreement for the benefit of the Initial
Purchasers and their direct and indirect transferees and assigns. The execution
and delivery of this Agreement is a condition to the Initial Purchasers'
obligations to purchase the Capital Securities under the Purchase Agreement.
The parties hereby agree as follows:
1. Definitions. As used in this Agreement, the following
capitalized terms shall have the following meanings:
Additional Interest: as defined in Section 5(a)
hereof.
Additional Distributions: as defined in Section 5(a)
hereof.
Broker-Dealer: Any broker or dealer registered under
the Exchange Act.
Closing Date: The date on which the Securities were
sold to the Initial Purchasers.
Commission: The Securities and Exchange Commission.
Consummate: A Registered Exchange Offer shall be
deemed "Consummated" for purposes of this Agreement upon the occurrence
of (i) the filing and effectiveness under the Securities Act of the
Exchange Offer Registration Statement relating to the New Securities to
be issued in the Exchange Offer, (ii) the maintenance of such
Registration Statement continuously effective and the keeping of the
Exchange Offer open for a period not less than the minimum period
required pursuant to Section 3(b) hereof, and (iii) the delivery by the
Company and the Trust of the New Securities in the same aggregate
principal amount as the aggregate principal amount of Transfer
Restricted Securities that were tendered by Holders thereof pursuant to
the Exchange Offer.
Declaration: The Amended and Restated Declaration of
Trust, dated as of June 8, 1997, among The First National Bank of
Chicago, as Property Trustee, First Chicago Delaware Inc., as Delaware
Trustee, and the Regular Trustees named therein, pursuant to which the
Capital
<PAGE> 4
2
Securities are being issued, as amended or supplemented from time to
time in accordance with the terms thereof.
Distribution: As defined in the Declaration.
Effectiveness Target Date: As defined in Section 5.
Exchange Act: The Securities Exchange Act of 1934, as
amended.
Exchange Offer: The registration by the Company and
the Trust under the Securities Act of the New Securities pursuant to a
Registration Statement pursuant to which the Company and the Trust
offer the Holders of all outstanding Transfer Restricted Securities the
opportunity to exchange all such outstanding Transfer Restricted
Securities held by such Holders for New Securities in an aggregate
amount equal to the aggregate amount of the Transfer Restricted
Securities tendered in such exchange offer by such Holders.
Exchange Offer Registration Statement: The
Registration Statement relating to the Exchange Offer, including the
Prospectus which forms a part thereof.
Exempt Resales: The transactions in which the Initial
Purchasers propose to sell the Securities to certain "qualified
institutional buyers," as such term is defined in Rule 144A under the
Securities Act, to certain institutional "accredited investors," as
such term is defined in Rule 501(a)(1), (2), (3) and (7) of Regulation
D under the Securities Act ("Accredited Institutions") and to certain
non-"U.S. persons" in "offshore transactions," as such terms are
defined in Regulation S under the Securities Act.
Guarantee Agreement: The Guarantee Agreement, dated
as of June 8, 1997, between the Company and The First National Bank of
Chicago, as Guarantee Trustee, pursuant to which the Guarantee is being
issued, as amended or supplemented from time to time in accordance with
the terms thereof.
Holders: As defined in Section 2(b) hereof.
Indenture: The Indenture, dated as of June 8, 1997,
between the Company and The First National Bank of Chicago, as trustee
(the "Trustee"), pursuant to which the Junior Subordinated Debentures
are to be issued, as such Indenture is amended or supplemented from
time to time in accordance with the terms thereof.
Initial Purchasers: As defined in the preamble
hereto.
NASD: National Association of Securities Dealers,
Inc.
New Junior Subordinated Debentures: The Company's
Junior Subordinated Debentures to be issued pursuant to the Indenture
in the Exchange Offer.
New Securities: The Securities to be issued pursuant
to the Indenture, the Declaration and the Guarantee Agreement in the
Exchange Offer.
<PAGE> 5
3
Person: An individual, partnership, corporation,
limited liability company, trust or unincorporated organization, or a
government or agency or political subdivision thereof.
Prospectus: The prospectus included in a Registration
Statement, as amended or supplemented by any prospectus supplement and
by all other amendments thereto, including post-effective amendments,
and all material incorporated by reference into such Prospectus.
Registration Default: As defined in Section 5 hereof.
Registration Statement: Any registration statement of
the Company and the Trust relating to (a) an offering of New Securities
pursuant to an Exchange Offer or (b) the registration for resale of
Transfer Restricted Securities pursuant to the Shelf Registration
Statement, which is filed pursuant to the provisions of this Agreement,
in either case, including the Prospectus included therein, all
amendments and supplements thereto (including post-effective
amendments) and all exhibits and material incorporated by reference
therein.
Securities Act: The Securities Act of 1933, as
amended.
Shelf Filing Deadline: As defined in Section 4
hereof.
Shelf Registration Statement: As defined in Section 4
hereof.
TIA: The Trust Indenture Act of 1939, as amended.
Transfer Restricted Securities: Each Security, until
the earliest to occur of (a) the date on which such Security has been
exchanged by a person other than a Broker-Dealer for New Securities in
the Exchange Offer, (b) following the exchange by a Broker-Dealer in
the Exchange Offer of such Security for one or more New Securities, the
date on which such New Securities are sold to a purchaser who receives
from such Broker-Dealer on or prior to the date of such sale a copy of
the prospectus contained in the Exchange Offer Registration Statement,
(c) the date on which such Security has been effectively registered
under the Securities Act and disposed of in accordance with the Shelf
Registration Statement or (d) the date on which such Security is
distributed to the public pursuant to Rule 144 under the Securities
Act;
Underwritten Registration or Underwritten Offering: A
registration in which securities of the Company and the Trust are sold
to an underwriter for reoffering to the public.
2. Securities Subject to This Agreement.
(a) Transfer Restricted Securities. The securities
entitled to the benefits of this Agreement are the Transfer Restricted
Securities.
(b) Holders of Transfer Restricted Securities. A
Person is deemed to be a holder of Transfer Restricted Securities
(each, a "Holder") whenever such Person beneficially owns Transfer
Restricted Securities.
<PAGE> 6
4
3. Registered Exchange Offer.
(a) Unless the Exchange Offer shall not be
permissible under applicable law or Commission policy (after the
procedures set forth in Section 6(a) below have been complied with),
the Company and the Trust shall (i) cause to be filed with the
Commission as soon as practicable after the Closing Date, but in no
event later than 60 days after the Closing Date, a Registration
Statement under the Securities Act relating to the New Securities and
the Exchange Offer, (ii) use their respective best efforts to cause
such Registration Statement to become effective at the earliest
possible time, but in no event later than 120 days after the Closing
Date, (iii) in connection with the foregoing, file (A) all
pre-effective amendments to such Registration Statement as may be
necessary in order to cause such Registration Statement to become
effective, (B) if applicable, a post-effective amendment to such
Registration Statement pursuant to Rule 430A under the Securities Act
and (C) all necessary filings in connection with the registration and
qualification of the New Securities under the Blue Sky laws of such
jurisdictions as are necessary to permit Consummation of the Exchange
Offer, and (iv) unless the Exchange Offer would not be permitted by
applicable law or Commission policy, the Company will commence the
Exchange Offer and use its best efforts to issue on or prior to 30
business days after the date on which such Registration Statement was
declared effective by the Commission, New Securities in exchange for
all Securities tendered prior thereto in the Exchange Offer. The
Exchange Offer shall be on the appropriate form permitting registration
of the New Securities to be offered in exchange for the Transfer
Restricted Securities and to permit resales of New Securities held by
Broker-Dealers as contemplated by Section 3(c) below.
(b) The Company and the Trust shall cause the
Exchange Offer Registration Statement to be effective continuously and
shall keep the Exchange Offer open for a period of not less than the
minimum period required under applicable federal and state securities
laws to Consummate the Exchange Offer; provided, however, that in no
event shall such period be less than 20 business days. The Company and
the Trust shall cause the Exchange Offer to comply with all applicable
federal and state securities laws. No securities other than the New
Securities shall be included in the Exchange Offer Registration
Statement. The Company and the Trust shall use its best efforts to
cause the Exchange Offer to be Consummated on the earliest practicable
date after the Exchange Offer Registration Statement has become
effective, but in no event later than 30 business days thereafter.
(c) The Company and the Trust shall indicate in a
"Plan of Distribution" section contained in the Prospectus contained in
the Exchange Offer Registration Statement that any Broker-Dealer who
holds Securities that are Transfer Restricted Securities and that were
acquired for its own account as a result of market-making activities or
other trading activities (other than Transfer Restricted Securities
acquired directly from the Company and the Trust), may exchange such
Securities pursuant to the Exchange Offer; however, such Broker-Dealer
may be deemed to be an "underwriter" within the meaning of the
Securities Act and must, therefore, deliver a prospectus meeting the
requirements of the Securities Act in connection with any resales of
the New Securities received by such Broker-Dealer in the Exchange
Offer, which prospectus delivery requirement may be satisfied by the
delivery by such Broker-Dealer of the Prospectus contained in the
Exchange Offer Registration Statement. Such "Plan of Distribution"
section shall also contain all other information with respect to such
resales by Broker-Dealers that the Commission may require in order to
permit such resales pursuant thereto, but such "Plan of Distribution"
shall not name any such Broker-Dealer or disclose the amount of New
Securities
<PAGE> 7
5
held by any such Broker-Dealer except to the extent required by the
Commission as a result of a change in policy announced after the date
of this Agreement.
The Company and the Trust shall use their respective best
efforts to keep the Exchange Offer Registration Statement continuously
effective, supplemented and amended as required by the provisions of Section
6(c) below to the extent necessary to ensure that it is available for resales of
New Securities acquired by Broker-Dealers for their own accounts as a result of
market-making activities or other trading activities, and to ensure that it
conforms with the requirements of this Agreement, the Securities Act and the
policies, rules and regulations of the Commission as announced from time to
time, for a period of 180 days from the date on which the Exchange Offer
Registration Statement is declared effective.
The Company and the Trust shall provide sufficient copies of
the latest version of such Prospectus to Broker-Dealers promptly upon request at
any time during such 180-day period in order to facilitate such resales.
4. Shelf Registration.
(a) Shelf Registration. If (i) the Company and the
Trust are not required to file an Exchange Offer Registration Statement
or to consummate the Exchange Offer because the Exchange Offer is not
permitted by applicable law or Commission policy (after the procedures
set forth in Section 6(a) below have been complied with), (ii) the
Company has received an opinion of counsel, rendered by a law firm
having a nationally recognized tax practice, to the effect that, as a
result of the Consummation of the Exchange Offer there is more than an
insubstantial risk that (x) the Trust would be subject to United States
federal income tax with respect to income received or accrued on the
Junior Subordinated Debentures or New Junior Subordinated Debentures,
(y) interest payable by the Company on such Junior Subordinated
Debentures or New Junior Subordinated Debentures would not be
deductible by the Company, in whole or in part, for United States
federal income tax purposes, or (z) the Trust would be subject to more
than a de minimis amount of other taxes, duties or other governmental
charges or (iii) if any Holder of Transfer Restricted Securities that
is a "qualified institutional buyer" (as defined in Rule 144A under the
Securities Act) or an "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act) shall notify the
Company at least 20 business days prior to the Consummation of the
Exchange Offer (A) that such Holder is prohibited by applicable law or
Commission policy from participating in the Exchange Offer, or (B) that
such Holder may not resell the New Securities acquired by it in the
Exchange Offer to the public without delivering a prospectus and that
the Prospectus contained in the Exchange Offer Registration Statement
is not appropriate or available for such resales by such Holder, or (C)
that such Holder is a Broker-Dealer and holds Securities acquired
directly from the Trust and the Company or one of its affiliates, then
the Trust and the Company shall use their respective best efforts to:
(x) cause to be filed a shelf registration
statement pursuant to Rule 415 under the Securities Act, which
may be an amendment to the Exchange Offer Registration
Statement (in either event, the "Shelf Registration
Statement"), on or prior to the earliest to occur of (1) the
30th day after the date on which the Trust and the Company
determines that they are not required to file the Exchange
Offer Registration Statement or (2) the 30th day after the
date on which the Trust and the Company receive notice from a
Holder of Transfer
<PAGE> 8
6
Restricted Securities as contemplated by clause (iii) above
(such earliest date being the "Shelf Filing Deadline"), which
Shelf Registration Statement shall provide for resales of all
Transfer Restricted Securities the Holders of which shall have
provided the information required pursuant to Section 4(b)
hereof; and
(y) cause such Shelf Registration Statement
to be declared effective by the Commission on or before the
60th day after the Shelf Filing Deadline.
The Trust and the Company shall use their respective best efforts to
keep such Shelf Registration Statement continuously effective,
supplemented and amended as required by the provisions of Sections 6(b)
and (c) hereof to the extent necessary to ensure that it is available
for resales of Securities by the Holders of Transfer Restricted
Securities entitled to the benefit of this Section 4(a), and to ensure
that it conforms with the requirements of this Agreement, the
Securities Act and the policies, rules and regulations of the
Commission as announced from time to time, for a period ending on the
third anniversary of the Closing Date.
(b) Provision by Holders of Certain Information in
Connection with the Shelf Registration Statement. No Holder of Transfer
Restricted Securities may include any of its Transfer Restricted
Securities in any Shelf Registration Statement pursuant to this
Agreement unless and until such Holder furnishes to the Trust and the
Company in writing, within 20 business days after receipt of a request
therefor, such information as the Trust and the Company may reasonably
request for use in connection with any Shelf Registration Statement or
Prospectus or preliminary Prospectus included therein. No Holder of
Transfer Restricted Securities shall be entitled to Additional
Distributions pursuant to Section 5 hereof or Article 3 of the
Indenture unless and until such Holder shall have used its best efforts
to provide all such reasonably requested information. Each Holder as to
which any Shelf Registration Statement is being effected agrees to
furnish promptly to the Trust and the Company all information required
to be disclosed in order to make the information previously furnished
to the Trust and the Company by such Holder not materially misleading.
5. Additional Interest and Additional Distributions Under
Certain Circumstances.
(a) If (a) any of the Registration Statements required by this
Agreement is not filed with the Commission on or prior to the date specified for
such filing in this Agreement, (b) any of such Registration Statements has not
been declared effective by the Commission on or prior to the date specified for
such effectiveness in this Agreement (the "Effectiveness Target Date"), (c) the
Exchange Offer has not been Consummated within 30 business days after the
Effectiveness Target Date with respect to the Exchange Offer Registration
Statement or (d) any Registration Statement required by this Agreement is filed
and declared effective but shall thereafter cease to be effective or fail to be
usable for its intended purpose (other than for any reason set forth in Section
6(c)(iii)(D) which shall not exceed 30 consecutive days, or 90 days in any
twelve month period) without being succeeded within two business days by a
post-effective amendment to such Registration Statement that cures such failure
and that is itself immediately declared effective (each such event referred to
in clauses (a) through (d), a "Registration Default"), additional interest (the
"Additional Interest") shall become payable in respect of the Junior
Subordinated Debentures (including in respect of amounts accruing during any
Extension Period (as defined in the Indenture)) and corresponding additional
Distributions (the "Additional Distributions") shall become payable to each
Holder of Capital Securities (in its capacity as such and not in its capacity as
an indirect
<PAGE> 9
7
holder of a pro rata share of the Junior Subordinated Debentures) with respect
to the first 90-day period immediately following the occurrence of such
Registration Default in an amount equal to $.25 per week per $1,000 liquidation
amount of Capital Securities held by such Holder for each week or portion
thereof that the Registration Default continues. The amount of Additional
Interest, and the corresponding amount of Additional Distributions payable to
any Holder of Capital Securities, shall increase by an additional $.05 per week
per $1,000 in liquidation amount of Capital Securities held by such Holder with
respect to each subsequent 90-day period until all Registration Defaults have
been cured, up to a maximum amount of Additional Interest (and corresponding
Additional Distributions) of $.50 per week per $1,000 liquidation amount of
Capital Securities. All accrued Additional Interest (and corresponding
Additional Distributions) shall be paid to Holders by the Trust and the Company
by wire transfer of immediately available funds or by federal funds check on the
last day of each such 90-day period. Following the cure of all Registration
Defaults relating to any particular Transfer Restricted Securities, the accrual
of Additional Interest (and corresponding Additional Distributions) with respect
to such Transfer Restricted Securities will cease.
All obligations of the Trust and the Company set forth in the
preceding paragraph that are outstanding with respect to any Transfer Restricted
Security at the time such security ceases to be a Transfer Restricted Security
shall survive until such time as all such obligations with respect to such
Transfer Restricted Security shall have been satisfied in full.
(b) The Trust and the Company shall notify the Property
Trustee within one business day after each and every date on which an event
occurs in respect of which Additional Distributions are required to be paid (an
"Event Date"). Additional Distributions shall be paid by depositing Additional
Interest with the Property Trustee, in trust, for the benefit of the Holders
thereof, on or before the applicable Interest Payment Date (whether or not any
payment other than Additional Distributions is payable on the Capital
Securities), immediately available funds in sums sufficient to pay the
Additional Distributions then due to Holders of Transfer Restricted Securities
with respect to which the Property Trustee serves. Each obligation to pay
Additional Interest and Additional Distributions shall be deemed to accrue from
the applicable date of the occurrence of the Registration Default.
6. Registration Procedures.
(a) Exchange Offer Registration Statement. In
connection with the Exchange Offer, the Trust and the Company shall
comply with all of the provisions of Section 6(c) below, shall use
their best efforts to effect such exchange to permit the sale of
Transfer Restricted Securities being sold in accordance with the
intended method or methods of distribution thereof, and shall comply
with all of the following provisions:
(i) If in the reasonable opinion of counsel
to the Trust and the Company there is a question as to whether
the Exchange Offer is permitted by applicable law, the Trust
and the Company hereby agree to seek a no-action letter from
the Commission allowing the Trust and the Company to
Consummate an Exchange Offer for such Securities. The Trust
and the Company hereby agree to pursue the issuance of such a
decision to the Commission staff level but shall not be
required to take commercially unreasonable action to effect a
change of Commission policy. The Trust and the Company hereby
agree, however, to (A) participate in telephonic conferences
with the Commission, (B) deliver to the Commission staff an
analysis prepared by counsel to the Trust and the Company
setting forth the legal bases, if any, upon which such counsel
has
<PAGE> 10
8
concluded that such an Exchange Offer should be permitted and
(C) diligently pursue a resolution (which need not be
favorable) by the Commission staff of such submission.
(ii) As a condition to its participation in
the Exchange Offer pursuant to the terms of this Agreement,
each Holder of Transfer Restricted Securities shall furnish,
upon the request of the Trust or the Company, prior to the
Consummation thereof, a written representation to the Trust or
the Company (which may be contained in the letter of
transmittal contemplated by the Exchange Offer Registration
Statement) to the effect that (A) it is not an affiliate of
the Trust or the Company, (B) it is not engaged in, and does
not intend to engage in, and has no arrangement or
understanding with any person to participate in, a
distribution of the New Securities to be issued in the
Exchange Offer and (C) it is acquiring the New Securities in
its ordinary course of business. In addition, all such Holders
of Transfer Restricted Securities shall otherwise cooperate in
the Company's and the Trust's preparations for the Exchange
Offer. Each Holder hereby acknowledges and agrees that any
Broker-Dealer and any such Holder using the Exchange Offer to
participate in a distribution of the securities to be acquired
in the Exchange Offer (1) could not under Commission policy as
in effect on the date of this Agreement rely on the position
of the Commission enunciated in Morgan Stanley and Co., Inc.
(available June 5, 1991) and Exxon Capital Holdings
Corporation (available May 13, 1988), as interpreted in the
Commission's letter to Shearman & Sterling dated July 2, 1993,
and similar no-action letters (including any no-action letter
obtained pursuant to clause (i) above), and (2) must comply
with the registration and prospectus delivery requirements of
the Securities Act in connection with a secondary resale
transaction and that such a secondary resale transaction
should be covered by an effective registration statement
containing the selling security holder information required by
Item 507 or 508, as applicable, of Regulation S-K if the
resales are of New Securities obtained by such Holder in
exchange for Securities acquired by such Holder directly from
the Trust or the Company.
(iii) Prior to effectiveness of the Exchange
Offer Registration Statement, the Company and the Trust shall
provide a supplemental letter to the Commission (A) stating
that the Company and the Trust are registering the Exchange
Offer in reliance on the position of the Commission enunciated
in Exxon Capital Holdings Corporation (available May 13,
1988), Morgan Stanley and Co., Inc. (available June 5, 1991)
and, if applicable, any no-action letter obtained pursuant to
clause (i) above and (B) including a representation that the
Company and the Trust have not entered into any arrangement or
understanding with any Person to distribute the New Securities
to be received in the Exchange Offer and that, to the best of
the Company's and the Trust's information and belief, based
only on written representations received under clause (ii)
above, that each Holder participating in the Exchange Offer is
acquiring the New Securities in its ordinary course of
business and has no arrangement or understanding with any
Person to participate in the distribution of the New
Securities received in the Exchange Offer.
(b) Shelf Registration Statement. In connection with
any Shelf Registration Statement, the Company and the Trust shall
comply with all the provisions of Section 6(c) below and shall use
their best efforts to effect such registration to permit the sale of
the Transfer Restricted Securities being sold in accordance with the
intended method or methods of distribution thereof, and pursuant
thereto the Company and the Trust will as expeditiously as possible
prepare
<PAGE> 11
9
and file with the Commission a Registration Statement relating to the
registration on any appropriate form under the Securities Act, which
form shall be available for the sale of the Transfer Restricted
Securities in accordance with the intended method or methods of
distribution thereof.
(c) General Provisions. In connection with any
Registration Statement and any Prospectus required by this Agreement to
permit the sale or resale of Transfer Restricted Securities (including,
without limitation, any Registration Statement and the related
Prospectus required to permit resales of Securities by Broker-Dealers),
the Company and the Trust shall:
(i) use their best efforts to keep such
Registration Statement continuously effective and provide all
requisite financial statements for the period specified in
Section 3 or 4 of this Agreement, as applicable; upon the
occurrence of any event that would cause any such Registration
Statement or the Prospectus contained therein (A) to contain a
material misstatement or omission or (B) not to be effective
and usable for resale of Transfer Restricted Securities during
the period required by this Agreement, the Company and the
Trust shall file promptly an appropriate amendment to such
Registration Statement, in the case of clause (A), correcting
any such misstatement or omission, and, in the case of either
clause (A) or (B), use their best efforts to cause such
amendment to be declared effective and such Registration
Statement and the related Prospectus to become usable for
their intended purpose(s) as soon as practicable thereafter;
(ii) prepare and file with the Commission
such amendments and post-effective amendments to the
Registration Statement as may be necessary to keep the
Registration Statement effective for the applicable period set
forth in Section 3 or 4 hereof, as applicable, or such shorter
period as will terminate when all Transfer Restricted
Securities covered by such Registration Statement have been
sold; cause the Prospectus to be supplemented by any required
Prospectus supplement, and as so supplemented to be filed
pursuant to Rule 424 under the Securities Act, and to comply
fully with the applicable provisions of Rules 424 and 430A
under the Securities Act in a timely manner; and comply with
the provisions of the Securities Act with respect to the
disposition of all securities covered by such Registration
Statement during the applicable period in accordance with the
intended method or methods of distribution by the sellers
thereof set forth in such Registration Statement or supplement
to the Prospectus;
(iii) advise the underwriter(s), if any, and
selling Holders promptly and, if requested by such Persons, to
confirm such advice in writing, (A) when the Prospectus or any
Prospectus supplement or post-effective amendment has been
filed, and, with respect to any Registration Statement or any
post-effective amendment thereto, when the same has become
effective, (B) of any request by the Commission for amendments
to the Registration Statement or amendments or supplements to
the Prospectus or for additional information relating thereto,
(C) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement
under the Securities Act or of the suspension by any state
securities commission of the qualification of the Transfer
Restricted Securities for offering or sale in any
jurisdiction, or the initiation of any proceeding for any of
the preceding purposes, and (D) of the existence of any fact
or the happening of any event that makes any statement of a
material fact made in the Registration Statement, the
Prospectus, any amendment or supplement thereto, or any
<PAGE> 12
10
document incorporated by reference therein untrue, or that
requires the making of any additions to or changes in the
Registration Statement or the Prospectus in order to make the
statements therein not misleading; provided that the Company
shall not be required to disclose the nature or substance of
any such fact or event as long as it is acting in good faith.
If at any time the Commission shall issue any stop order
suspending the effectiveness of the Registration Statement, or
any state securities commission or other regulatory authority
shall issue an order suspending the qualification or exemption
from qualification of the Transfer Restricted Securities under
state securities or Blue Sky laws, the Trust and the Company
shall use their best efforts to obtain the withdrawal or
lifting of such order at the earliest possible time;
(iv) furnish to each of the selling or
exchanging Holders and each of the underwriter(s), if any,
before filing with the Commission, copies of any Shelf
Registration Statement or any Prospectus included therein or
any amendments or supplements to any such Shelf Registration
Statement or Prospectus (excluding all documents incorporated
by reference after the initial filing of such Registration
Statement), which documents will be subject to the review of
such Holders and underwriter(s), if any, for a period of at
least five business days, and the Trust and the Company will
not file any such Registration Statement or Prospectus or any
amendment or supplement to any such Registration Statement or
Prospectus to which a selling Holder of Transfer Restricted
Securities covered by such Registration Statement or the
underwriter(s), if any, shall reasonably object within such
five business days. A selling Holder or underwriter, if any,
shall be deemed to have reasonably objected to such filing if
such Registration Statement, amendment, Prospectus or
supplement, as applicable, as proposed to be filed, contains a
material misstatement or omission;
(v) promptly after the filing of any
document that is to be incorporated by reference into a
Registration Statement or Prospectus, provide copies of such
document to the selling Holders and to the underwriter(s), if
any, and make the Trust's and the Company's representatives
available for discussion of such document and other customary
due diligence matters;
(vi) make available at reasonable times for
inspection by the selling Holders, any underwriter
participating in any disposition pursuant to such Registration
Statement, and any attorney or accountant retained by such
selling Holders or any of the underwriter(s), all financial
and other records, pertinent corporate documents and
properties of the Trust and the Company and cause the Trust's
and the Company's officers, directors, managers and employees
to supply all information reasonably requested by any such
Holder, underwriter, attorney or accountant in connection with
such Registration Statement subsequent to the filing thereof
and prior to its effectiveness;
(vii) if requested by any selling Holders
under the Shelf Registration Statement or the underwriter(s),
if any, promptly incorporate in any Shelf Registration
Statement or Prospectus, pursuant to a supplement or
post-effective amendment if necessary, such information as
such selling Holders and underwriter(s), if any, may
reasonably request to have included therein, including,
without limitation, information relating to the "Plan of
Distribution" of the Transfer Restricted Securities,
information with respect to the principal amount of Transfer
Restricted Securities being sold to such underwriter(s), the
purchase price being paid therefor and any other terms of the
offering
<PAGE> 13
11
of the Transfer Restricted Securities to be sold in such
offering; and make all required filings of such Prospectus
supplement or post-effective amendment as soon as practicable
after the Trust and the Company are notified of the matters to
be incorporated in such Prospectus supplement or
post-effective amendment;
(viii) cause the Transfer Restricted
Securities covered by the Registration Statement (A) to be
rated with the appropriate rating agencies, if so requested by
the Holders of a majority in aggregate principal amount of
Securities covered thereby or the underwriter(s), if any, or
(B) if the Transfer Restricted Securities were previously
rated to reconfirm such ratings;
(ix) furnish to each selling Holder and each
of the underwriter(s), if any, without charge, at least one
copy of the Registration Statement, as first filed with the
Commission, and of each amendment thereto, including all
documents incorporated by reference therein and all exhibits
(including exhibits incorporated therein by reference);
(x) deliver to each selling Holder and each
of the underwriter(s), if any, without charge, as many copies
of the Prospectus (including each preliminary prospectus) and
any amendment or supplement thereto as such Persons reasonably
may request; the Trust and the Company hereby consent to the
use of the Prospectus and any amendment or supplement thereto
by each of the selling Holders and each of the underwriter(s),
if any, in connection with the offering and the sale of the
Transfer Restricted Securities covered by the Prospectus or
any amendment or supplement thereto;
(xi) enter into such agreements (including
an underwriting agreement), and make such representations and
warranties, and take all such other actions in connection
therewith in order to expedite or facilitate the disposition
of the Transfer Restricted Securities pursuant to any
Registration Statement contemplated by this Agreement, all to
such extent as may be reasonably requested by any Purchaser or
by any Holder of Transfer Restricted Securities or underwriter
in connection with any sale or resale pursuant to any
Registration Statement contemplated by this Agreement; and in
connection with an Underwritten Registration, the Trust and
the Company shall:
(A) upon request, furnish to each
selling Holder and each underwriter, if any, in such
substance and scope as they may reasonably request
and as are customarily made by issuers to
underwriters in primary underwritten offerings, upon
the date of the effectiveness of the Shelf
Registration Statement:
(1) a certificate, dated
the date of the effectiveness of the Shelf
Registration Statement, signed by (y) the
Chairman of the Board, its President or a
Vice President and (z) the Chief Financial
Officer of the Company, confirming, as of
the date thereof, such matters as such
parties may reasonably request;
(2) an opinion, dated the
date of the effectiveness of the Shelf
Registration Statement, of counsel for the
Company and the Trust, covering such matters
as such parties may reasonably request, and
in any event including a statement to the
effect that such counsel has participated in
conferences with officers and other
representatives of the
<PAGE> 14
12
Company and the Trust, representatives of
the independent public accountants for the
Company, the Initial Purchasers'
representatives and the Initial Purchasers'
counsel in connection with the preparation
of such Registration Statement and the
related Prospectus and have considered the
matters required to be stated therein and
the statements contained therein, although
such counsel has not independently verified
the accuracy, completeness or fairness of
such statements; and that such counsel
advises that, on the basis of the foregoing
(relying as to materiality to a large extent
upon facts provided to such counsel by
officers and other representatives of the
Company and the Trust and without
independent check or verification), no facts
came to such counsel's attention that caused
such counsel to believe that the applicable
Registration Statement, at the time such
Registration Statement or any post-effective
amendment thereto became effective,
contained an untrue statement of a material
fact or omitted to state a material fact
required to be stated therein or necessary
to make the statements therein not
misleading, or that the Prospectus contained
in such Registration Statement as of its
date, contained an untrue statement of a
material fact or omitted to state a material
fact necessary in order to make the
statements therein, in light of the
circumstances under which they were made,
not misleading. Without limiting the
foregoing, such counsel may state further
that such counsel assumes no responsibility
for, and has not independently verified, the
accuracy, completeness or fairness of the
financial statements, notes and schedules
and other financial data included in any
Registration Statement contemplated by this
Agreement or the related Prospectus; and
(3) a customary comfort
letter, dated the date of the effectiveness
of the Shelf Registration Statement, from
the Company's independent accountants, in
the customary form and covering matters of
the type customarily covered in comfort
letters by underwriters in connection with
primary underwritten offerings.
(B) set forth in full or incorporate
by reference in the underwriting agreement, if any,
the indemnification provisions and procedures of
Section 8 hereof with respect to all parties to be
indemnified pursuant to said Section; and
(C) deliver such other documents and
certificates as may be reasonably requested by such
parties to evidence compliance with clause (A) above
and with any customary conditions contained in the
underwriting agreement or other agreement entered
into by the Company and the Trust pursuant to this
clause (xi), if any.
If at any time the representations and
warranties of the Company contemplated in clause (A)(1) above
cease to be true and correct, the Company shall so advise the
Initial Purchasers and the underwriter(s), if any, and each
selling Holder promptly and, if requested by such Persons,
shall confirm such advice in writing;
<PAGE> 15
13
(xii) prior to any public offering of
Transfer Restricted Securities, cooperate with the selling
Holders, the underwriter(s), if any, and their respective
counsel in connection with the registration and qualification
of the Transfer Restricted Securities under the securities or
Blue Sky laws of such jurisdictions as the selling Holders or
underwriter(s) may reasonably request and do any and all other
acts or things necessary or advisable to enable the
disposition in such jurisdictions of the Transfer Restricted
Securities covered by the Shelf Registration Statement;
provided, however, that neither the Company nor the Trust
shall not be required to register or qualify as a foreign
corporation where it is not now so qualified or to take any
action that would subject it to the service of process in
suits or to taxation, other than as to matters and
transactions relating to the Registration Statement, in any
jurisdiction where it is not now so subject;
(xiii) shall issue, upon the request of any
Holder of Securities covered by the Shelf Registration
Statement, New Securities in the same amount as the Securities
surrendered to the Company and the Trust by such Holder in
exchange therefor or being sold by such Holder; such New
Securities to be registered in the name of such Holder or in
the name of the purchaser(s) of such Securities, as the case
may be; in return, the Securities held by such Holder shall be
surrendered to the Company and the Trust for cancellation;
(xiv) cooperate with the selling Holders and
the underwriter(s), if any, to facilitate the timely
preparation and delivery of certificates representing Transfer
Restricted Securities to be sold and not bearing any
restrictive legends; and enable such Transfer Restricted
Securities to be in such denominations and registered in such
names as the Holders or the underwriter(s), if any, may
request at least two business days prior to any sale of
Transfer Restricted Securities made by such underwriter(s);
(xv) if any fact or event contemplated by
clause (c)(iii)(D) above shall exist or have occurred, as
promptly as is practicable under the circumstances in the good
faith determination of the Company prepare a supplement or
post-effective amendment to the Registration Statement or
related Prospectus or any document incorporated therein by
reference or file any other required document so that, as
thereafter delivered to the purchasers of Transfer Restricted
Securities, the Registration Statement will not contain an
untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein not
misleading; and any Prospectus will not contain an untrue
statement of a material fact or omit to state any material
fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading;
(xvi) provide CUSIP numbers for all Transfer
Restricted Securities not later than the effective date of the
Registration Statement and provide certificates for the
Transfer Restricted Securities;
(xvii) cooperate and assist in any filings
required to be made with the NASD and in the performance of
any due diligence investigation by any underwriter (including
any "qualified independent underwriter") that is required to
be retained in accordance with the rules and regulations of
the NASD, and use its best efforts to cause such Registration
Statement to become effective and approved by such
governmental
<PAGE> 16
14
agencies or authorities as may be necessary to enable the
Holders selling Transfer Restricted Securities to consummate
the disposition of such Transfer Restricted Securities;
(xviii) otherwise use its best efforts to
comply with all applicable rules and regulations of the
Commission, and make generally available to its security
holders, as soon as practicable, a consolidated earnings
statement meeting the requirements of Rule 158 (which need not
be audited) for the twelve-month period (A) commencing at the
end of any fiscal quarter in which Transfer Restricted
Securities are sold to underwriters in a firm or best efforts
Underwritten Offering or (B) if not sold to underwriters in
such an offering, beginning with the first month of the
Company's first fiscal quarter commencing after the effective
date of the Registration Statement;
(xix) cause the Indenture, the Guarantee and
the Declaration to be qualified under the TIA not later than
the effective date of the first Registration Statement
required by this Agreement, and, in connection therewith,
cooperate with the applicable trustees and the Holders of
Securities to effect such changes to the Indenture, the
Guarantee and the Declaration as may be required for the
Indenture, the Guarantee and the Declaration to be so
qualified in accordance with the terms of the TIA; and
execute, and use their best efforts to cause the Indenture
Trustee, Guarantee Trustee and the Property Trustee to
execute, all documents that may be required to effect such
changes and all other forms and documents required to be filed
with the Commission to enable such Indenture to be so
qualified in a timely manner; and
(xx) provide promptly to each Holder upon
request each document filed with the Commission pursuant to
the requirements of Section 13(a) and Section 15(d) of the
Exchange Act.
Each Holder agrees by acquisition of a Transfer
Restricted Security that, upon receipt of any notice from the Company
or the Trust of the existence of any fact or event of the kind
described in Section 6(c)(iii)(D) hereof, such Holder will forthwith
discontinue disposition of Transfer Restricted Securities pursuant to
the applicable Registration Statement until such Holder's receipt of
the copies of the supplemented or amended Prospectus contemplated by
Section 6(c)(xvi) hereof, or until it is advised in writing (the
"Advice") by the Company or the Trust that the use of the Prospectus
may be resumed, and has received copies of any additional or
supplemental filings that are incorporated by reference in the
Prospectus. If so directed by the Company or the Trust, each Holder
will deliver to the Company or the Trust (at the Company's and the
Trust's expense) all copies, other than permanent file copies then in
such Holder's possession, of the Prospectus covering such Transfer
Restricted Securities that was current at the time of receipt of such
notice. In the event the Company or the Trust shall give any such
notice, the time period regarding the effectiveness of such
Registration Statement set forth in Section 3 or 4 hereof, as
applicable, shall be extended by the number of days during the period
from and including the date of the giving of such notice pursuant to
Section 6(c)(iii)(D) hereof to and including the date when each selling
Holder covered by such Registration Statement shall have received the
copies of the supplemented or amended Prospectus contemplated by
Section 6(c)(xvi) hereof or shall have received the Advice.
<PAGE> 17
15
7. Registration Expenses.
All expenses incident to the Company's and the
Trust's performance of or compliance with this Agreement, other than
the expenses of any Holder, will be borne by the Company and the Trust,
regardless of whether a Registration Statement becomes effective,
including without limitation: (i) all registration and filing fees and
expenses (including filings made by any Holder with the NASD (and, if
applicable, the fees and expenses of any "qualified independent
underwriter" and its counsel that may be required by the rules and
regulations of the NASD)); (ii) all fees and expenses of compliance
with federal securities and state Blue Sky or securities laws; (iii)
all expenses of printing (including printing certificates for the New
Securities to be issued in the Exchange Offer and printing of
Prospectuses), and associated messenger and delivery services and
telephone; (iv) all fees and disbursements of counsel for the Company
and the Trust; (v) all application and filing fees in connection with
listing Securities on a national securities exchange or automated
quotation system pursuant to the requirements hereof; (vi) all fees and
disbursements of independent certified public accountants of the
Company and the Trust (including the expenses of any special audit and
comfort letters required by or incident to such performance); and (vii)
in the event a Shelf Registration Statement shall be filed, shall bear
or reimburse the Holders of the Transfer Restricted Securities covered
thereby for the reasonable fees and disbursements of one firm of
counsel designated by the Holders of a majority in principal amount of
the Transfer Restricted Securities covered thereby to act as counsel
for the Holders of Transfer Restricted Securities in connection
therewith.
The Company and the Trust will, in any event, bear
their internal expenses (including, without limitation, all salaries
and expenses of their officers and employees performing legal or
accounting duties), the expenses of any annual audit and the fees and
expenses of any Person, including special experts, retained by the
Company or the Trust.
8. Indemnification and Contribution.
(a) In connection with a Shelf Registration Statement or in
connection with any delivery of a Prospectus contained in an Exchange Offer
Registration Statement by any participating Broker-Dealer or Initial Purchaser,
as applicable, who seeks to sell New Securities, the Company and the Trust shall
indemnify and hold harmless each Holder of Transfer Restricted Securities
included within any such Shelf Registration Statement and each participating
Broker-Dealer or Initial Purchaser selling New Securities, and each person, if
any, who controls any such person within the meaning of Section 15 of the
Securities Act (each, a "Participant") from and against any loss, claim, damage
or liability, joint or several, or any action in respect thereof (including, but
not limited to, any loss, claim, damage, liability or action relating to
purchases and sales of Securities) to which such Participant or controlling
person may become subject, under the Securities Act or otherwise, insofar as
such loss, claim, damage, liability or action arises out of, or is based upon,
(i) any untrue statement or alleged untrue statement of a material fact
contained in any such Registration Statement or any prospectus forming part
thereof or in any amendment or supplement thereto or (ii) the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, and shall reimburse
each Participant promptly upon demand for any legal or other expenses reasonably
incurred by such Participant in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability or action as
such expenses are incurred; provided, however, that (i) the Company and the
Trust shall not be liable in any such case to the extent that any such loss,
claim, damage, liability or action arises out of, or is based upon, any untrue
statement or alleged untrue statement or omission or alleged omission made in
any such Registration Statement or any prospectus forming part thereof or in any
such
<PAGE> 18
16
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company and the Trust by or on behalf of any
Participant specifically for inclusion therein; and provided further that as to
any preliminary Prospectus, the indemnity agreement contained in this Section
8(a) shall not inure to the benefit of any such Participant or any controlling
person of such Participant on account of any loss, claim, damage, liability or
action arising from the sale of the New Securities to any person by that
Participant if (i) that Participant failed to send or give a copy of the
Prospectus, as the same may be amended or supplemented, to that person within
the time required by the Securities Act and (ii) the untrue statement or alleged
untrue statement of a material fact or omission or alleged omission to state a
material fact in such preliminary Prospectus was corrected in the Prospectus,
unless, in each case, such failure resulted from non-compliance by the Company
and the Trust with Section 6(c). The foregoing indemnity agreement is in
addition to any liability which the Company and the Trust may otherwise have to
any Participant or to any controlling person of that Participant.
(b) Each Participant, severally and not jointly, shall
indemnify and hold harmless the Company and the Trust, each of its directors,
officers, employees or agents and each person, if any, who controls the Company
and the Trust within the meaning of Section 15 of the Securities Act, from and
against any loss, claim, damage or liability, joint or several, or any action in
respect thereof, to which the Company and the Trust or any such director,
officer, employees or agents or controlling person may become subject, under the
Securities Act or otherwise, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon, (i) any untrue statement or alleged
untrue statement of a material fact contained in any preliminary Prospectus,
Registration Statement or Prospectus or in any amendment or supplement thereto
or (ii) the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, but in each case only to the extent that the untrue statement or
alleged untrue statement or omission or alleged omission was made in reliance
upon and in conformity with written information furnished to the Company and the
Trust by or on behalf of such Participant specifically for inclusion herein, and
shall reimburse the Company and the Trust and any such director, officer,
employees or agents or controlling person for any legal or other expenses
reasonably incurred by the Company and the Trust or any such director, officer,
employees or agents or controlling person in connection with investigating or
defending or preparing to defend against any such loss, claim, damage, liability
or action as such expenses are incurred. The foregoing indemnity agreement is in
addition to any liability which any Participant may otherwise have to the
Company and the Trust or any such director, officer or controlling person.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 8, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have under this Section 8 except to the extent it has
been materially prejudiced by such failure and, provided further, that the
failure to notify the indemnifying party shall not relieve it from any liability
which it may have to an indemnified party otherwise than under this Section 8.
If any such claim or action shall be brought against an indemnified party, and
it shall have notified the indemnifying party thereof, the indemnifying party
shall be entitled to participate therein and, to the extent that it wishes,
jointly with any other similarly notified indemnifying party, to assume the
defense thereof with counsel satisfactory to the indemnified party. After notice
from the indemnifying party to the indemnified party of its election to assume
the defense of such claim or action, the indemnifying party shall not be liable
to the indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, that
the Participants shall have the right to employ counsel to represent them and
their respective officers,
<PAGE> 19
17
employees and controlling persons who may be subject to liability arising out of
any claim in respect of which indemnity may be sought by the Participants
against the Company and the Trust under this Section 8 if, in the reasonable
judgment of the Participants it is advisable for the Participants and their
officers, employees and controlling persons to be represented by separate
counsel, and in that event the fees and expenses of such separate counsel shall
be paid by the Trust and the Company. Each indemnified party, as a condition of
the indemnity agreements contained in Section 8, shall use its best efforts to
cooperate with the indemnifying party in the defense of any such action or
claim. No indemnifying party shall (i) without the prior written consent of the
indemnified parties (which consent shall not be unreasonably withheld), settle
or compromise or consent to the entry of any judgment with respect to any
pending or threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified parties are actual or potential parties to such claim or action)
unless such settlement, compromise or consent includes an unconditional release
of each indemnified party from all liability arising out of such claim, action,
suit or proceeding, or (ii) be liable for any settlement of any such action
effected without its written consent (which consent shall not be unreasonably
withheld), but if settled with its written consent or if there be a final
judgment of the plaintiff in any such action, the indemnifying party agrees to
indemnify and hold harmless any indemnified party from and against any loss of
liability by reason of such settlement or judgment.
(d) If the indemnification provided for in this Section 8
shall for any reason be unavailable to or insufficient to hold harmless an
indemnified party under Section 8(a) or 8(b) in respect of any loss, claim,
damage or liability, or any action in respect thereof, referred to therein, then
each indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be appropriate to reflect the relative benefits
received by the indemnifying party or parties on the one hand and the
indemnified party on the other from the exchange of the Securities pursuant to
the Registered Exchange Offer, or (ii) if the allocation provided by the
foregoing clause (i) is not permitted by applicable law, in such proportion as
is appropriate to reflect not only the relative benefits referred to in clause
(i) above but also the relative fault of the indemnifying party on the one hand
and the indemnified party on the other with respect to the statements or
omissions which resulted in such loss, claim, damage or liability, or action in
respect thereof, as well as any other relevant equitable considerations. The
relative fault shall be determined by reference to whether the untrue or alleged
untrue statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by the Trust and the Company or
the Participants, the intent of the parties and their relative knowledge, access
to information and opportunity to correct or prevent such statement or omission.
The Company and the Trust and the Participants agree that it would not be just
and equitable if contributions pursuant to this Section 8(d) were to be
determined by pro rata allocation (even if the Participants were treated as one
entity for such purpose) or by any other method of allocation which does not
take into account the equitable considerations referred to herein. The amount
paid or payable by an indemnified party as a result of the loss, claim, damage
or liability, or action in respect thereof, referred to above in this Section
8(d) shall be deemed to include, for purposes of this Section 8(d), any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 8(d), no Participant shall be required to contribute
any amount in excess of the amount by which the net proceeds received by such
Participant from an offering of the Notes exceeds the amount of any damages
which such Participant has otherwise paid or become liable to pay by reason of
any 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 Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The Participants'
obligations to contribute as provided in this Section 8(d) are several and not
joint.
<PAGE> 20
18
9. Rule 144A.
The Company and the Trust hereby agrees with each Holder, for
so long as any Transfer Restricted Securities remain outstanding, to make
available to any Holder or beneficial owner of Transfer Restricted Securities in
connection with any sale thereof and any prospective purchaser of such Transfer
Restricted Securities from such Holder or beneficial owner, upon request, the
information required by Rule 144A(d)(4) under the Securities Act in order to
permit resales of such Transfer Restricted Securities pursuant to Rule 144A.
10. Participation in Underwritten Registrations.
No Holder may participate in any Underwritten Registration
hereunder unless such Holder (a) agrees to sell such Holder's Transfer
Restricted Securities on the basis provided in any underwriting arrangements
approved by the Persons entitled hereunder to approve such arrangements and (b)
completes and executes all reasonable questionnaires, powers of attorney,
indemnities, underwriting agreements, lockup letters and other documents
required under the terms of such underwriting arrangements.
11. Selection of Underwriters.
The Holders of Transfer Restricted Securities covered by the
Shelf Registration Statement who desire to do so may sell such Transfer
Restricted Securities in an Underwritten Offering. In any such Underwritten
Offering, the investment banker or investment bankers and manager or managers
that will administer the offering will be selected by the Holders of a majority
in aggregate principal amount of the Transfer Restricted Securities included in
such offering; provided, that such investment bankers and managers must be
reasonably satisfactory to the Company.
12. Miscellaneous.
(a) Remedies. The Company and the Trust agree that
monetary damages (including the Additional Interest and Additional
Distributions contemplated hereby) would not be adequate compensation
for any loss incurred by reason of a breach by it of the provisions of
this Agreement and hereby agree to waive the defense in any action for
specific performance that a remedy at law would be adequate.
(b) No Inconsistent Agreements. The Company and the
Trust will not on or after the date of this Agreement enter into any
agreement with respect to their securities that is inconsistent with
the rights granted to the Holders in this Agreement or otherwise
conflicts with the provisions hereof. The Company and the Trust have
not previously entered into any agreement granting any registration
rights with respect to their securities to any Person. The rights
granted to the Holders hereunder do not in any way conflict with and
are not inconsistent with the rights granted to the holders of the
Trust's and the Company's securities under any agreement in effect on
the date hereof.
(c) Adjustments Affecting the Securities. The Company
and the Trust will not take any action, or permit any change to occur,
with respect to the Securities that would materially and adversely
affect the ability of the Holders to Consummate any Exchange Offer.
(d) Amendments and Waivers. The provisions of this
Agreement may not be amended, modified or supplemented, and waivers or
consents to or departures from the
<PAGE> 21
19
provisions hereof may not be given, unless the Company and the Trust
have obtained the written consent of Holders of a majority of the
outstanding principal amount of Transfer Restricted Securities.
Notwithstanding the foregoing, a waiver or consent to departure from
the provisions hereof that relates exclusively to the rights of Holders
whose Securities are being tendered pursuant to the Exchange Offer and
that does not affect directly or indirectly the rights of other Holders
whose Securities are not being tendered pursuant to such Exchange Offer
may be given by the Holders of a majority of the outstanding principal
amount of Transfer Restricted Securities being tendered or registered.
(e) Notices. All notices and other communications
provided for or permitted hereunder shall be made in writing by
hand-delivery, first-class mail (registered or certified, return
receipt requested), telex, telecopier, or air courier guaranteeing
overnight delivery:
(i) if to a Holder, at the address set forth
on the records of the Property Trustee maintained pursuant to
the Declaration; and
(ii) if to the Company and the Trust:
The First National Bank of Chicago
One First National Plaza
Suite 0126
Chicago, Illinois 60670-0126
Attention: Corporate Trust
Administration
All such notices and communications shall be deemed
to have been duly given: at the time delivered by hand, if personally
delivered; five business days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; when
receipt acknowledged, if telecopied; and on the next business day, if
timely delivered to an air courier guaranteeing overnight delivery.
Copies of all such notices, demands or other
communications shall be concurrently delivered by the Person giving the
same to the Trustee at the address specified in the Indenture.
(f) Successors and Assigns. This Agreement shall
inure to the benefit of and be binding upon the successors and assigns
of each of the parties, including without limitation and without the
need for an express assignment, subsequent Holders of Transfer
Restricted Securities; provided, however, that this Agreement shall not
inure to the benefit of or be binding upon a successor or assign of a
Holder unless and to the extent such successor or assign acquired
Transfer Restricted Securities from such Holder.
(g) Counterparts. This Agreement may be executed in
any number of counterparts and by the parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the
same agreement.
(h) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect
the meaning hereof.
<PAGE> 22
20
(i) Governing Law. THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK,
WITHOUT REGARD TO THE CONFLICTS OF LAW RULES THEREOF.
(j) Severability. In the event that any one or more
of the provisions contained herein, or the application thereof in any
circumstance, is held invalid, illegal or unenforceable, the validity,
legality and enforceability of any such provision in every other
respect and of the remaining provisions contained herein shall not be
affected or impaired thereby.
(k) Entire Agreement. This Agreement together with
the other transaction documents is intended by the parties as a final
expression of their agreement and intended to be a complete and
exclusive statement of the agreement and understanding of the parties
hereto in respect of the subject matter contained herein. There are no
restrictions, promises, warranties or undertakings, other than those
set forth or referred to herein with respect to the registration rights
granted by the Company and the Trust with respect to the Transfer
Restricted Securities. This Agreement supersedes all prior agreements
and understandings between the parties with respect to such subject
matter.
(l) Required Consents. Whenever the consent or
approval of Holders of a specified percentage of Transfer Restricted
Securities is required hereunder, Transfer Restricted Securities held
by the Company or its affiliates (as such term is defined in Rule 405
under the Securities Act) shall not be counted in determining whether
such consent or approval was given by the Holders of such required
percentage.
<PAGE> 23
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
STAR BANC CORPORATION
By: /s/ JENNIE P. CARLSON
-------------------------------------
Name: Jennie P. Carlson
Title: SVP, General Counsel and Secretary
STAR CAPITAL I
By: /s/ BRUCE BARNES
-------------------------------------
Name: Bruce Barnes
Title: Regular Trustee
The foregoing Registration Rights
Agreement is hereby confirmed and
accepted as of the date first
above written
CREDIT SUISSE FIRST BOSTON CORPORATION
By: /s/ ROBERT D. HANSEN
-----------------------------------
Name: Robert D. Hansen
Title: Director
Acting severally on behalf of
itself and the several Initial
Purchasers named herein
<PAGE> 1
Exhibit 4.8
FORM OF GUARANTEE AGREEMENT
STAR CAPITAL I
DATED AS OF , 1997
<PAGE> 2
CROSS REFERENCE TABLE*
<TABLE>
<CAPTION>
Section of Trust
Indenture Act of Section of
1939, as amended Agreement
<S> <C>
310(a)...........................................................................4.1(a)
310(b)...........................................................................4.1(c)
310(c).....................................................................Inapplicable
311(a)...........................................................................2.2(b)
311(b)...........................................................................2.2(b)
311(c).....................................................................Inapplicable
312(a)...........................................................................2.2(a)
312(b)...........................................................................2.2(b)
312(c)..............................................................................2.9
313(a)..............................................................................2.3
313(b)..............................................................................2.3
313(c)..............................................................................2.3
313(d)..............................................................................2.3
314(a)..............................................................................2.4
314(b).....................................................................Inapplicable
314(c)..............................................................................2.5
314(d).....................................................................Inapplicable
314(e)..............................................................................2.5
314(f).....................................................................Inapplicable
315(a)...................................................................3.1(d); 3.2(a)
315(b)...........................................................................2.7(a)
315(c)...........................................................................3.1(c)
315(d)...........................................................................3.1(d)
316(a)......................................................................2.6; 5.4(a)
317(a)........................................................................2.10; 5.4
318(a)...........................................................................2.1(b)
</TABLE>
- --------
* This Cross-Reference Table does not constitute part of the Agreement
and shall not have any bearing upon the interpretation of any of its
terms or provisions.
<PAGE> 3
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
ARTICLE 1
INTERPRETATION AND DEFINITIONS........................................ 1
SECTION 1.1 Interpretation and Definitions............................................................ 1
ARTICLE 2
TRUST INDENTURE ACT............................................. 4
SECTION 2.1 Trust Indenture Act; Application.......................................................... 4
SECTION 2.2 Lists of Holders of Securities............................................................ 5
SECTION 2.3 Reports by Guarantee Trustee.............................................................. 5
SECTION 2.4 Periodic Reports to Guarantee Trustee..................................................... 5
SECTION 2.5 Evidence of Compliance with Conditions Precedent.......................................... 5
SECTION 2.6 Guarantee Event of Default; Waiver........................................................ 5
SECTION 2.7 Guarantee Event of Default; Notice........................................................ 5
SECTION 2.8 Conflicting Interests..................................................................... 6
SECTION 2.9 Disclosure of Information................................................................. 6
SECTION 2.10 Guarantee Trustee May File Proofs of Claim............................................... 6
ARTICLE 3
POWERS, DUTIES AND RIGHTS OF
GUARANTEE TRUSTEE.............................................. 6
SECTION 3.1 Powers and Duties of Guarantee Trustee.................................................... 6
SECTION 3.2 Certain Rights of Guarantee Trustee....................................................... 8
SECTION 3.3 Not Responsible for Recitals or Issuance of Guarantee..................................... 10
ARTICLE 4
GUARANTEE TRUSTEE.............................................. 10
SECTION 4.1 Guarantee Trustee; Eligibility............................................................ 10
SECTION 4.2 Appointment, Removal and Resignation of Guarantee Trustee................................. 11
ARTICLE 5
GUARANTEE.................................................. 12
SECTION 5.1 Guarantee................................................................................. 12
SECTION 5.2 Waiver of Notice and Demand............................................................... 12
SECTION 5.3 Obligations Not Affected.................................................................. 12
SECTION 5.4 Rights of Holders......................................................................... 13
SECTION 5.5 Guarantee of Payment...................................................................... 14
SECTION 5.6 Subrogation............................................................................... 14
SECTION 5.7 Independent Obligations................................................................... 14
</TABLE>
-i-
<PAGE> 4
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
ARTICLE 6
LIMITATION OF TRANSACTIONS; SUBORDINATION......................................... 14
SECTION 6.1 Limitation of Transactions................................................................ 14
SECTION 6.2 Ranking................................................................................... 15
ARTICLE 7
TERMINATION......................................................... 15
SECTION 7.1 Termination............................................................................... 15
ARTICLE 8
INDEMNIFICATION....................................................... 16
SECTION 8.1 Exculpation............................................................................... 16
SECTION 8.2 Indemnification........................................................................... 16
ARTICLE 9
MISCELLANEOUS........................................................ 16
SECTION 9.1 Successors and Assigns.................................................................... 16
SECTION 9.2 Amendments................................................................................ 17
SECTION 9.3 Notices................................................................................... 17
SECTION 9.4 Benefit................................................................................... 18
SECTION 9.5 Governing Law............................................................................. 18
</TABLE>
-ii-
<PAGE> 5
GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT (the "Guarantee"), dated as of ,
1997, is executed and delivered by Star Banc Corporation, an Ohio corporation
(the "Guarantor"), and The First National Bank of Chicago, a national banking
association, as trustee (the "Guarantee Trustee"), for the benefit of the
Holders (as defined herein) of the Securities (as defined herein) of Star
Capital I, a Delaware statutory business trust (the "Trust").
W I T N E S S E T H :
WHEREAS, pursuant to the Declaration (as defined herein), the
Trust issued $150,000,000 aggregate liquidation amount of its Floating Rate
Capital Securities, liquidation amount of $1,000 per capital security (the "Old
Capital Securities") representing undivided beneficial ownership interests in
the assets of the Trust and having the terms set forth in the Declaration;
WHEREAS, the Old Capital Securities issued by the Trust and
the proceeds thereof, together with the proceeds from the issuance of the
Trust's Common Securities (as defined below), were used to purchase the
Debentures (as defined in the Declaration) of the Guarantor;
WHEREAS, pursuant to the Declaration, the Trust issued 4,640
common securities, having a liquidation amount of $1,000 per common security,
designated the Floating Rate Common Securities (the "Common Securities");
WHEREAS, as an incentive for the Holders to purchase the Old
Capital Securities, the Guarantor irrevocably and unconditionally agreed, to the
extent set forth in that certain Guarantee Agreement, dated as of June 8, 1997
(the "Old Guarantee"), among the Guarantor and the Guarantee Trustee, for the
benefit of the Holders of the Old Capital Securities and the Common Securities
to pay to the Holders of the Old Capital Securities and the Common Securities
the Guarantee Payments (as defined therein) and to make certain other payments
on the terms and conditions set forth therein;
WHEREAS, pursuant to that certain Registration Rights
Agreement, dated as of June 8, 1997 (the "Registration Rights Agreement"), among
the Guarantor, the Trust and the Initial Purchasers named therein, the Guarantor
and the Trust agreed that if the Guarantor and the Trust file a registration
statement (the "Registration Statement") to exchange the Old Capital Securities
for a like amount of new capital securities (the "New Capital Securities";
together with the Old Capital Securities, the "Capital Securities"), then the
Guarantor and the Trust will simultaneously exchange the Old Guarantee for the
Guarantee for the benefit of the Holders of the Capital Securities and the
Common Securities;
<PAGE> 6
2
WHEREAS, on August 8, 1997 the Guarantor and the Trust filed
the Registration Statement and the Registration Statement, as amended, was
declared effective on , 1997;
WHEREAS, pursuant to the Registration Rights Agreement, the
Guarantor and the Trust wish to exchange the Old Guarantee for the Guarantee;
WHEREAS, the Guarantee will be substantially identical to the
Old Guarantee except that the Guarantee will be registered pursuant to an
effective registration statement under the Securities Act of 1933, as amended
(the "Securities Act"), and the Guarantee will not contain provisions
restricting transfer in the absence of registration under the Securities Act;
and
WHEREAS, as incentive for the Holders to retain the Capital
Securities, the Guarantor desires irrevocably and unconditionally to agree, to
the extent set forth in this Guarantee, to pay to the Holders of the Capital
Securities and the Common Securities, the Guarantee Payments (as defined herein)
and to make certain other payments on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the purchase by each
Holder of Securities, which purchase the Guarantor hereby agrees shall benefit
the Guarantor, the Guarantor executes and delivers this Guarantee for the
benefit of the Holders.
ARTICLE 1
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Interpretation and Definitions. In this Guarantee,
unless the context otherwise requires:
(a) capitalized terms used in this Guarantee 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 Guarantee has the same
meaning throughout;
(c) all references to "the Guarantee" or "this Guarantee" are
to this Guarantee as modified, supplemented or amended from time to
time;
(d) all references in this Guarantee to Articles and Sections
are to Articles and Sections of this Guarantee, unless otherwise
specified;
(e) a term defined in the Trust Indenture Act has the same
meaning when used in this Guarantee, unless otherwise defined in this
Guarantee or unless the context otherwise requires; and
<PAGE> 7
3
(f) a reference to the singular includes the plural and vice
versa and a reference to the masculine includes, as applicable, the
feminine.
"Affiliate" has the same meaning as given to that term in Rule
405 of the Securities Act of 1933, as amended, or any successor rule thereunder.
"Business Day" has the meaning given to such term in the
Indenture.
"Corporate Trust Office" means the office of the Guarantee
Trustee at which the corporate trust business of the Guarantee Trustee shall at
any particular time, be principally administered, which office at the date of
execution of this Guarantee is located at The First National Bank of Chicago,
One First National Plaza, Suite 0126, Chicago, Illinois 60670-0126, Attention:
Corporate Trust Services.
"Covered Person" means any Holder or beneficial owner of
Securities.
"Debentures" means the series of junior subordinated
debentures to be issued, in one or more issuances, by the Guarantor, designated
the Floating Rate Junior Subordinated Debentures due 2027, held by the Property
Trustee (as defined in the Declaration) of the Trust.
"Declaration" means the Amended and Restated Declaration of
Trust, dated as of June 8, 1997, as amended, modified or supplemented from time
to time, among the trustees of the Trust named therein, the Guarantor, as
sponsor, and the holders from time to time of undivided beneficial ownership
interests in the assets of the Trust.
"Guarantee Event of Default" means a default by the Guarantor
on any of its payment or other obligations under this Guarantee.
"Guarantee Payments" means the following payments or
distributions, without duplication, with respect to the Securities, to the
extent not paid or made by the Trust: (i) any accumulated and unpaid
Distributions (as defined in the Declaration) that are required to be paid on
such Securities to the extent the Trust shall have sufficient funds available
therefor at the time, (ii) the redemption price, including all accrued and
unpaid Distributions to the date of redemption with respect to any Securities
called for redemption by the Trust, to the extent the Trust shall have
sufficient funds available therefor at the time, and (iii) upon a voluntary or
involuntary dissolution, winding-up or termination of the Trust (other than in
connection with the distribution of Debentures to the Holders in exchange for
Securities as provided in the Declaration), the lesser of (a) the aggregate of
the liquidation amount and all accrued and unpaid Distributions on the
Securities to the date of payment, and (b) the amount of assets of the Trust
remaining available for distribution to Holders in liquidation of the Trust (in
either case, the "Liquidation Distribution"). If a Trust Enforcement Event (as
defined in the Declaration) has occurred and is continuing, the rights of
holders of the Common Securities to receive Guarantee Payments under this
Guarantee are subordinated to the rights of Holders of the Capital Securities to
receive payments hereunder.
<PAGE> 8
4
"Guarantee Trustee" means The First National Bank of Chicago,
until a successor Guarantee Trustee has been appointed and has accepted such
appointment pursuant to the terms of this Guarantee and thereafter means each
such Successor Guarantee Trustee.
"Holder" shall mean any holder of Securities, as registered on
the books and records of the Trust; 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 or any other obligor on the Capital
Securities; and provided further, that in determining whether the Holders of the
requisite liquidation amount of Capital Securities have voted on any matter
provided for in this Guarantee, then for the purpose of such determination only
(and not for any other purpose hereunder), if the Capital Securities remain in
the form of one or more Global Certificates (as defined in the Declaration), the
term "Holders" shall mean the holder of the Global Certificate acting at the
direction of the beneficial owners of the Capital Securities.
"Indemnified Person" means the Guarantee Trustee, any
Affiliate of the Guarantee Trustee, and any officers, directors, shareholders,
members, partners, employees, representatives, nominees, custodians or agents of
the Guarantee Trustee.
"Indenture" means the Indenture, dated as of June 8, 1997,
among the Guarantor and The First National Bank of Chicago, as trustee, and any
indenture supplemental thereto pursuant to which the Debentures are to be issued
to the Property Trustee (as defined in the Declaration) of the Trust.
"Majority in Liquidation Amount of the Securities" means,
except as provided in the terms of the Securities or by the Trust Indenture Act,
Holder(s) of outstanding Securities, voting separately as a class, who are the
record holders of more than 50% 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. In determining
whether the Holders of the requisite amount of Securities have voted, Securities
which are owned by the Guarantor or any Affiliate of the Guarantor shall be
disregarded for the purpose of any such determination.
"Officers' Certificate" means, with respect to any Person, a
certificate signed on behalf of such Person by two Authorized Officers (as
defined in the Declaration) of such Person. Any Officers' Certificate delivered
with respect to compliance with a condition or covenant provided for in this
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 on behalf
<PAGE> 9
5
of such Person to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(c) a statement as to whether, in the opinion of each such
officer acting on behalf of such Person, such condition or covenant has
been complied with.
"Outstanding" has the meaning given to such term in the
Indenture.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Responsible Officer" means, with respect to the Guarantee
Trustee, any officer within the Corporate Trust Office of the Guarantee Trustee,
including any vice president, any assistant vice president, the secretary, any
assistant secretary, the treasurer, any assistant treasurer or other officer of
the Corporate Trust Office of the 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.
"Securities" means the collective reference to the Common
Securities and the Capital Securities.
"Successor Guarantee Trustee" means a successor Guarantee
Trustee possessing the qualifications to act as Guarantee Trustee under Section
4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended from time to time, or any successor legislation.
ARTICLE 2
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application. (a) This
Guarantee is subject to the provisions of the Trust Indenture Act that are
required to be part of this Guarantee and shall, to the extent applicable, be
governed by such provisions.
(b) If and to the extent that any provision of this Guarantee
limits, qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.
SECTION 2.2 Lists of Holders of Securities. (a) The Guarantor
shall provide the Guarantee Trustee with a list, in such form as the Guarantee
Trustee may reasonably
<PAGE> 10
6
require, of the names and addresses of the Holders of the Securities ("List of
Holders"), (i) semi-annually, not later than June 30 and December 31 of each
year and current as of such date, and (ii) at such other times as the Guarantee
Trustee may request in writing, within 30 days of receipt by the Guarantor of a
written request from the Guarantee Trustee for a List of Holders as of a date no
more than 15 days before such List of Holders is given to the Guarantee Trustee;
excluding from any such list names and addresses received by the Guarantee
Trustee in its capacity as Security Registrar (as defined in the Indenture). The
Guarantee Trustee shall preserve, in as current a form as is reasonably
practicable, all information contained in Lists of Holders given to it, provided
that it may destroy any List of Holders previously given to it on receipt of a
new List of Holders.
(b) The Guarantee Trustee shall comply with its obligations
under Sections 311(a), 311(b) and 312(b) of the Trust Indenture Act.
SECTION 2.3 Reports by Guarantee Trustee. Within 60 days after
May 15 of each year (commencing with the year of the issuance of the
Securities), the Guarantee Trustee shall provide to the Holders of the
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 Guarantee Trustee shall also comply with the requirements of
Section 313(d) of the Trust Indenture Act.
SECTION 2.4 Periodic Reports to Guarantee Trustee. The
Guarantor shall provide to the 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 required by Section 314 of the Trust
Indenture Act.
SECTION 2.5 Evidence of Compliance with Conditions Precedent.
The Guarantor shall provide to the Guarantee Trustee such evidence of compliance
with any conditions precedent, if any, provided for in this 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 Guarantee Event of Default; Waiver. The Holders of
a Majority in Liquidation Amount of the Securities may, by vote or written
consent, on behalf of the Holders of all of the Securities, waive any past
Guarantee Event of Default and its consequences. Upon such waiver, any such
Guarantee Event of Default shall cease to exist, and any Guarantee Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Guarantee, but no such waiver shall extend to any subsequent or other
default or Guarantee Event of Default or impair any right consequent thereon.
SECTION 2.7 Guarantee Event of Default; Notice. (a) The
Guarantee Trustee shall, within 90 days after the occurrence of a Guarantee
Event of Default actually known to a Responsible Officer of the Guarantee
Trustee, transmit by mail, first class postage prepaid, to the Holders of the
Securities, notices of all such Guarantee Events of Default,
<PAGE> 11
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unless such defaults have been cured before the giving of such notice; provided,
that the Guarantee Trustee shall be protected in withholding such notice if and
so long as a Responsible Officer of the Guarantee Trustee in good faith
determines that the withholding of such notice is in the interests of the
Holders of the Securities.
(b) The Guarantee Trustee shall not be deemed to have
knowledge of any Guarantee Event of Default unless the Guarantee Trustee shall
have received written notice thereof or a Responsible Officer of the Guarantee
Trustee charged with the administration of the Declaration shall have obtained
actual knowledge thereof.
SECTION 2.8 Conflicting Interests. The Declaration shall be
deemed to be specifically described in this Guarantee for the purposes of clause
(i) of the first provision contained in Section 310(b) of the Trust Indenture
Act.
SECTION 2.9 Disclosure of Information. The disclosure of
information as to the names and addresses of the Holders of the Securities in
accordance with Section 312 of the Trust Indenture Act, regardless of the source
from which such information was derived, shall not be deemed to be a violation
of any existing law, or any law hereafter enacted which does not specifically
refer to Section 312 of the Trust Indenture Act, nor shall the Guarantee Trustee
be held accountable by reason of mailing any material pursuant to a request made
under Section 312(b) of the Trust Indenture Act.
SECTION 2.10 Guarantee Trustee May File Proofs of Claim. Upon
the occurrence of a Guarantee Event of Default, the Guarantee Trustee is hereby
authorized to (a) recover judgment, in its own name and as trustee of an express
trust, against the Guarantor for the whole amount of any Guarantee Payments
remaining unpaid and (b) file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have its claims and those of the
Holders of the Securities allowed in any judicial proceedings relative to the
Guarantor, its creditors or its property.
ARTICLE 3
POWERS, DUTIES AND RIGHTS OF
GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of Guarantee Trustee.
(a) This Guarantee shall be held by the Guarantee Trustee on
behalf of the Trust for the benefit of the Holders of the Securities, and the
Guarantee Trustee shall not transfer this Guarantee to any Person except a
Holder of Securities exercising his or her rights pursuant to Section 5.4(b) or
to a Successor Guarantee Trustee on acceptance by such Successor Guarantee
Trustee. The right, title and interest of the Guarantee Trustee in and to this
Guarantee shall automatically vest in any Successor Guarantee Trustee, and such
vesting and succession of title shall be effective whether or not conveyancing
documents have been executed and delivered pursuant to the appointment of such
Successor Guarantee Trustee.
<PAGE> 12
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(b) If a Guarantee Event of Default actually known to a
Responsible Officer of the Guarantee Trustee has occurred and is continuing, the
Guarantee Trustee shall enforce this Guarantee for the benefit of the Holders of
the Securities.
(c) The Guarantee Trustee, before the occurrence of any
Guarantee Event of Default and after the curing of all Guarantee Events of
Default that may have occurred, shall undertake to perform only such duties as
are specifically set forth in this Guarantee, and no implied covenants shall be
read into this Guarantee against the Guarantee Trustee. In case a Guarantee
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 Guarantee
Trustee, the Guarantee Trustee shall exercise such of the rights and powers
vested in it by this 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 Guarantee shall be construed to
relieve the Guarantee Trustee from liability for its own negligent action, its
own negligent failure to act, or its own willful misconduct, except that:
(i) prior to the occurrence of any Guarantee
Event of Default and after the curing or waiving of all such
Guarantee Events of Default that may have occurred:
(A) the duties and obligations of the
Guarantee Trustee shall be determined solely by the
express provisions of this Guarantee, and the
Guarantee Trustee shall not be liable except for the
performance of such duties and obligations as are
specifically set forth in this Guarantee, and no
implied covenants or obligations shall be read into
this Guarantee against the Guarantee Trustee; and
(B) in the absence of bad faith on the part
of the Guarantee Trustee, the Guarantee Trustee may
conclusively rely, as to the truth of the statements
and the correctness of the opinions expressed
therein, upon any certificates or opinions furnished
to the Guarantee Trustee and conforming to the
requirements of this Guarantee; but in the case of
any such certificates or opinions that by any
provision hereof are specifically required to be
furnished to the Guarantee Trustee, the Guarantee
Trustee shall be under a duty to examine the same to
determine whether or not they conform to the
requirements of this Guarantee;
(ii) the Guarantee Trustee shall not be liable
for any error of judgment made in good faith by a Responsible
Officer of the Guarantee Trustee, unless it shall be proved
that the Guarantee Trustee was negligent in ascertaining the
pertinent facts upon which such judgment was made;
<PAGE> 13
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(iii) the Guarantee Trustee shall not be liable
with respect to any action taken or omitted to be taken by it
in good faith in accordance with the direction of the Holders
of not less than a Majority in Liquidation Amount of the
Securities relating to the time, method and place of
conducting any proceeding for any remedy available to the
Guarantee Trustee, or exercising any trust or power conferred
upon the Guarantee Trustee under this Guarantee; and
(iv) no provision of this Guarantee shall
require the Guarantee Trustee to expend or risk its own funds
or otherwise incur personal financial liability in the
performance of any of its duties or in the exercise of any of
its rights or powers, if the Guarantee Trustee shall have
reasonable grounds for believing that the repayment of such
funds or liability is not reasonably assured to it under the
terms of this Guarantee or indemnify, reasonably satisfactory
to the Guarantee Trustee, against such risk or liability is
not reasonably assured to it.
SECTION 3.2 Certain Rights of Guarantee Trustee. (a) Subject
to the provisions of Section 3.1:
(i) The Guarantee Trustee may 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 Guarantor
contemplated by this Guarantee shall be sufficiently evidenced
by an Officers' Certificate;
(iii) Whenever, in the administration of
this Guarantee, the Guarantee Trustee shall deem it desirable
that a matter be proved or established before taking,
suffering or omitting any action hereunder, the Guarantee
Trustee (unless other evidence is herein specifically
prescribed) may, in the absence of bad faith on its part,
request and conclusively rely upon an Officers' Certificate
which, upon receipt of such request, shall be promptly
delivered by the Guarantor;
(iv) The Guarantee Trustee shall have no
duty to see to any recording, filing or registration or any
instrument (or any rerecording, refiling or registration
thereof);
(v) The Guarantee Trustee may consult with
counsel, 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
<PAGE> 14
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opinion. Such counsel may be counsel to the Guarantor or any
of its Affiliates and may include any of its employees. The
Guarantee Trustee shall have the right at any time to seek
instructions concerning the administration of this Guarantee
from any court of competent jurisdiction;
(vi) The Guarantee Trustee shall be under no
obligation to exercise any of the rights or powers vested in
it by this Guarantee at the request or direction of any
Holder, unless such Holder shall have provided to the
Guarantee Trustee such security and indemnity, reasonably
satisfactory to the Guarantee Trustee, against the costs,
expenses (including attorneys' fees and expenses and the
expenses of the Guarantee 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 Guarantee
Trustee; provided, that nothing contained in this Section
3.2(a)(vi) shall be taken to relieve the Guarantee Trustee,
upon the occurrence of a Guarantee Event of Default, of its
obligation to exercise the rights and powers vested in it by
this Guarantee;
(vii) The Guarantee Trustee shall not be
bound to make any investigation into the facts or matters
stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other
paper or document, but the Guarantee Trustee, in its
discretion, may make such further inquiry or investigation
into such facts or matters as it may see fit;
(viii) The 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 Guarantee 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 Guarantee
Trustee or its agents hereunder shall bind the Holders of the
Securities, and the signature of the 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 Guarantee Trustee to so act or as to its
compliance with any of the terms and provisions of this
Guarantee, both of which shall be conclusively evidenced by
the Guarantee Trustee's or its agent's taking such action; and
(x) Whenever in the administration of this
Guarantee the Guarantee Trustee shall deem it desirable to
receive instructions with respect to enforcing any remedy or
right or taking any other action hereunder, the Guarantee
Trustee (i) may request instructions from the Holders of a
Majority in Liquidation Amount of the Securities, (ii) may
refrain from enforcing such remedy or right or taking such
other action until such instructions are received,
<PAGE> 15
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and (iii) shall be protected in conclusively relying on or
acting in accordance with such instructions.
(b) No provision of this Guarantee shall be deemed to impose
any duty or obligation on the Guarantee Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it in any
jurisdiction in which it shall be illegal, or in which the Guarantee Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Guarantee Trustee
shall be construed to be a duty.
SECTION 3.3 Not Responsible for Recitals or Issuance of
Guarantee. The recitals contained in this Guarantee shall be taken as the
statements of the Guarantor, and the Guarantee Trustee does not assume any
responsibility for their correctness. The Guarantee Trustee makes no
representations as to the validity or sufficiency of this Guarantee.
ARTICLE 4
GUARANTEE TRUSTEE
SECTION 4.1 Guarantee Trustee; Eligibility.
(a) There shall be at all times a 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
Exchange 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 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 Guarantee Trustee shall cease to be
eligible to so act under Section 4.1(a), the Guarantee Trustee shall immediately
resign in the manner and with the effect set out in Section 4.2(b).
<PAGE> 16
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(c) If the Guarantee Trustee has or shall acquire any
"conflicting interest" within the meaning of Section 310(b) of the Trust
Indenture Act, the Guarantee Trustee and Guarantor shall in all respects comply
with the provisions of Section 310(b) of the Trust Indenture Act.
SECTION 4.2 Appointment, Removal and Resignation of Guarantee
Trustee.
(a) Subject to Section 4.1(b), the Guarantee Trustee may be
appointed or removed with or without cause at any time by the Guarantor. No
resignation or removal of the Guarantee Trustee and no appointment of a
Successor Guarantee Trustee pursuant to this Article shall become effective
until the acceptance of appointment by the Successor Guarantee Trustee by
written instrument executed by the Successor Guarantee Trustee and delivered to
the Holders and the Guarantee Trustee.
(b) The Guarantee Trustee appointed to office shall hold such
office until a Successor Guarantee Trustee shall have been appointed or until
its removal or resignation.
(c) Subject to the immediately preceding paragraph, a
Guarantee Trustee may resign at any time by giving written notice thereof to the
Holders and the Guarantor, which resignation shall not take effect until a
Successor Guarantee Trustee has been appointed and has accepted such appointment
by instrument in writing executed by such Successor Guarantee Trustee and
delivered to the Guarantor and the resigning Guarantee Trustee.
(d) If no Successor Guarantee Trustee shall have been
appointed and accepted appointment as provided in this Section 4.2 within 30
days after delivery to the Guarantor of an instrument of removal or resignation,
the removed or resigning Guarantee Trustee may petition any court of competent
jurisdiction for the appointment of a Successor Guarantee Trustee. Such court
may thereupon, after prescribing such notice, if any, as it may deem proper,
appoint a Successor Guarantee Trustee.
(e) No Guarantee Trustee shall be liable for the acts or
omissions to act of any Successor Guarantee Trustee.
(f) Upon termination of this Guarantee or removal or
resignation of the Guarantee Trustee pursuant to this Section 4.2, the Guarantor
shall pay to the Guarantee Trustee all amounts owing for fees and reimbursement
of expenses which have accrued to the date of such termination, removal or
resignation.
(g) The Guarantor shall promptly notify the Holders of the
resignation, removal or appointment of the Guarantee Trustee.
<PAGE> 17
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ARTICLE 5
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 Trust), as and when due, regardless of any defense,
right of set-off or counterclaim that the Trust 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 Trust to pay such amounts to the Holders. If a Trust Enforcement Event has
occurred and is continuing, the rights of holders of the Common Securities to
receive payments under this Guarantee are subordinated to the rights of Holders
of Capital Securities to receive Guarantee Payments under this Guarantee.
SECTION 5.2 Waiver of Notice and Demand.
The Guarantor hereby waives notice of acceptance of this
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 Trust 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. Notwithstanding anything to the contrary herein, the Guarantor retains
all of its rights under the Indenture to extend the interest payment period on
the Debentures and the Guarantor shall not be obligated hereunder to make any
Guarantee Payments during any Extension Period (as defined in the Indenture)
with respect to the Distributions (as defined in the Declaration) on the
Securities.
SECTION 5.3 Obligations Not Affected.
The obligations, covenants, agreements and duties of the
Guarantor under this Guarantee shall be absolute and unconditional and shall
remain in full force and effect until the entire liquidation amount of all
outstanding Securities shall have been paid and such obligation shall in no way
be affected or impaired by reason of the happening from time to time of any
event, including without limitation, the following, whether or not with notice
to, or the consent of, the Guarantor:
(a) The release or waiver, by operation of law or otherwise,
of the performance or observance by the Trust of any express or implied
agreement, covenant, term or condition relating to the Securities to be
performed or observed by the Trust;
(b) The extension of time for the payment by the Trust of all
or any portion of the Distributions, Redemption Price (as defined in
the Indenture), Liquidation Distribution or any other sums payable
under the terms of the Securities or the extension of time for the
performance of any other obligation under, arising out of, or
<PAGE> 18
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in connection with the Securities (other than an extension 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);
(c) Any failure, omission, delay or lack of diligence on the
part of the Property Trustee or the Holders to enforce, assert or
exercise any right, privilege, power or remedy conferred on the
Property Trustee or the Holders pursuant to the terms of the
Securities, or any action on the part of the Trust granting indulgence
or extension of any kind;
(d) The voluntary or involuntary liquidation, dissolution,
sale of any collateral, receivership, insolvency, bankruptcy,
assignment for the benefit of creditors, reorganization, arrangement,
composition or readjustment of debt of, or other similar proceedings
affecting, the Trust or any of the assets of the Trust;
(e) Any invalidity of, or defect or deficiency in, the
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 hereunder shall be absolute and unconditional under any and
all circumstances.
There shall be no obligation of the Guarantee Trustee or the
Holders to give notice to, or obtain consent of, the Guarantor or any other
Person with respect to the happening of any of the foregoing.
No setoff, counterclaim, reduction or diminution of any
obligation, or any defense of any kind or nature that the Guarantor has or may
have against any Holder shall be available hereunder to the Guarantor against
such Holder to reduce the payments to it under this Guarantee.
SECTION 5.4 Rights of Holders.
(a) The Holders of a Majority in Liquidation Amount of the
Securities have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Guarantee Trustee in respect of this
Guarantee or exercising any trust or power conferred upon the Guarantee Trustee
under this Guarantee.
(b) If the Guarantee Trustee fails to enforce this Guarantee,
then any Holder of Securities may, subject to the subordination provisions of
Section 6.2, institute a legal proceeding directly against the Guarantor to
enforce the Guarantee Trustee's rights under this Guarantee without first
instituting a legal proceeding against the Trust, the Guarantee Trustee or any
other person or entity. Notwithstanding the foregoing, if the Guarantor has
failed to
<PAGE> 19
15
make a Guarantee Payment, a Holder of Securities may, subject to the
subordination provisions of Section 6.2, directly institute a proceeding against
the Guarantor for enforcement of the Guarantee for such payment to the Holder of
the Securities of the principal of or interest on the Debentures on or after the
respective due dates specified in the Debentures, and the amount of the payment
will be based on the Holder's pro rata share of the amount due and owing on all
of the Securities. The Guarantor hereby waives any right or remedy to require
that any action on this Guarantee be brought first against the Trust or any
other person or entity before proceeding directly against the Guarantor.
SECTION 5.5 Guarantee of Payment.
This 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 Securities against the Trust in respect of any amounts paid to
such Holders by the Guarantor under this Guarantee; provided, however, that the
Guarantor shall not (except to the extent required by mandatory provisions of
law) be entitled to enforce or exercise any right that it may acquire by way of
subrogation of any indemnity, reimbursement or other agreement, in all cases as
a result of payment under this Guarantee, if at the time of any such payment,
any amounts are due and unpaid under this 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
Guarantee Trustee for the benefit of the Holders.
SECTION 5.7 Independent Obligations.
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Trust with respect to the Securities, and
that the Guarantor shall be liable as principal and as debtor hereunder to make
Guarantee Payments pursuant to the terms of this Guarantee notwithstanding the
occurrence of any event referred to in subsections 5.3(a) through 5.3(g),
inclusive, hereof.
ARTICLE 6
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions.
So long as any Securities remain outstanding, if there shall
have occurred a Guarantee Event of Default or a Trust Enforcement Event, then
the Guarantor shall not, and shall not permit any subsidiary of the Guarantor,
to (i) declare or pay any dividends or distributions on, or redeem, purchase,
acquire, or make a liquidation payment with respect to, the Guarantor's capital
stock or (ii) make any payment of principal, interest or premium, if
<PAGE> 20
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any, on or repay, repurchase or redeem any debt securities of the Guarantor that
rank pari passu with or junior to the Debentures or make any guarantee payments
with respect to any guarantee by the Guarantor of the debt securities of any
subsidiary of the Guarantor if such guarantee ranks pari passu with or junior to
the Debentures (other than (a) repurchases, redemptions or other acquisitions of
shares of capital stock of the Guarantor in connection with any employment
contract, benefit plan or other similar arrangement with or for the benefit of
any one or more employees, officers, directors or consultants or in connection
with a dividend reinvestment or stockholder stock purchase plan, (b) as a result
of an exchange or conversion of any class or series of the Guarantor's capital
stock (or any capital stock of a subsidiary of the Guarantor) for any class or
series of the Guarantor's capital stock or of any class or series of the
Guarantor's indebtedness for any class or series of the Guarantor's capital
stock, (c) the purchase of fractional interests 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, (d) any declaration of a
dividend in connection with the adoption of any stockholder's rights plan, or
the issuance of rights, stock or other property under any stockholder's rights
plan, or the redemption or repurchase of rights pursuant thereto, or (e) any
dividend in the form of stock, warrants, options or other rights where the
dividend stock or the stock issuable upon exercise of such warrants, options or
other rights is the same stock as that on which the dividend is being paid (or
pari passu with or junior to such stock).
SECTION 6.2 Ranking.
This Guarantee will constitute an unsecured obligation of the
Guarantor and will rank subordinate and junior in right of payment to all other
liabilities of the Guarantor, except those liabilities of the Guarantor made
pari passu or subordinate by their express terms.
If a Trust Enforcement Event has occurred and is continuing
under the Declaration, the rights of the holders of the Common Securities to
receive Guarantee Payments hereunder shall be subordinated to the rights of the
holders of the Capital Securities to receive payment of all amounts due and
owing hereunder.
ARTICLE 7
TERMINATION
SECTION 7.1 Termination.
This Guarantee shall terminate upon (i) full payment of the
Redemption Price (as defined in the Declaration) of all Securities, (ii) upon
the distribution of the Debentures to the Holders of all the Securities or (iii)
upon full payment of the amounts payable in accordance with the Declaration upon
liquidation of the Trust. Notwithstanding the foregoing, this Guarantee will
continue to be effective or will be reinstated, as the case may be, if at any
time any Holder of Securities must restore payment of any sums paid under the
Securities or under this Guarantee.
<PAGE> 21
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ARTICLE 8
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
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
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
matter 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 pertinent to the existence and amount of assets from
which Distributions to Holders of 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 any loss, liability 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 Guarantee or the resignation or removal of the
Guarantee Trustee.
ARTICLE 9
MISCELLANEOUS
SECTION 9.1 Successors and Assigns.
All guarantees and agreements contained in this Guarantee
shall bind the successors, assigns, receivers, trustees and representatives of
the Guarantor and shall inure to the benefit of the Holders of the Securities
then outstanding.
<PAGE> 22
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SECTION 9.2 Amendments.
Except with respect to any changes that do not adversely
affect the rights of the Holders (in which case no consent of the Holders will
be required), this Guarantee may only be amended with the prior approval of the
Holders of at least a Majority in Liquidation Amount of the Securities. The
provisions of Section 12.2 of the Declaration with respect to meetings of, and
action by written consent of, the Holders of the Securities apply to the giving
of such approval.
SECTION 9.3 Notices.
All notices provided for in this Guarantee shall be in
writing, duly signed by the party giving such notice, and shall be delivered,
telecopied or mailed by registered or certified mail, as follows:
(a) If given to the Guarantee Trustee, at the Guarantee
Trustee's mailing address set forth below (or such other address as the
Guarantee Trustee may give notice of to the Guarantor and the Holders
of the Securities):
The First National Bank of Chicago
One First National Plaza, Suite 0126
Chicago, Illinois 60670-0126
Attention: Corporate Trust
Fax: (312) 407-1708
(b) If given to the Guarantor, at the Guarantor's mailing
addresses set forth below (or such other address as the Guarantor may
give notice of to the Guarantee Trustee and the Holders of the
Securities):
Star Banc Corporation
425 Walnut Street
Cincinnati, Ohio 45202
Attn: General Counsel
Fax: (513) 632-5512
(c) If given to any Holder of Securities, 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 delivered
on the date of such refusal or inability to deliver.
<PAGE> 23
19
SECTION 9.4 Benefit.
This Guarantee is solely for the benefit of the Holders of the
Securities and, subject to Section 3.1(a), is not separately transferable from
the Securities.
SECTION 9.5 Governing Law.
THIS GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
<PAGE> 24
IN WITNESS WHEREOF, this Guarantee is executed as of the day
and year first above written.
STAR BANC CORPORATION,
as Guarantor
By: /s/ BRUCE BARNES
-------------------------------------
Name: Bruce Barnes
Title: SVP and Treasurer
THE FIRST NATIONAL BANK OF CHICAGO,
as Guarantee Trustee
By: /s/ JOHN R. PRENDIVILLE
------------------------------------
Name: John R. Prendiville
Title: Vice President
<PAGE> 1
Exhibit 4.9
FLOATING RATE JUNIOR SUBORDINATED DEBENTURES
DUE 2027
CALCULATION AGENCY AGREEMENT
BETWEEN
STAR BANC CORPORATION
AND
THE FIRST NATIONAL BANK OF CHICAGO
DATED AS OF JUNE 8, 1997
STAR BANC CORPORATION, an Ohio corporation (the "Corporation"), will
issue and sell, in one or more issuances and sales, certain of its securities
designated as Floating Rate Junior Subordinated Debentures due 2027
("Debentures"). The Debentures will be issued under an Indenture, dated as of
June 8, 1997 (the "Indenture"), between the Corporation and The First National
Bank of Chicago, as Trustee (the "Trustee"). The Debentures, when issued and
sold, will be purchased by Star Capital I, a newly formed Delaware business
trust. Terms used but not defined herein shall have the meanings assigned to
them in the Declaration (as defined in the Indenture) and the Indenture.
For the purpose of appointing an agent to calculate the interest
rate, based on LIBOR, on the Debentures, the Corporation and The First National
Bank of Chicago agree as follows:
1. Upon the terms and subject to the conditions contained herein,
the Corporation hereby appoints The First National Bank of Chicago as its agent
(in such capacity, the "Calculation Agent") for the purpose of calculating the
interest rates on the Debentures in the manner and at the times provided in the
Indenture and the provisions of this Agreement.
2. The Calculation Agent shall exercise due care to determine the
interest rate on the Debentures with respect to each interest period and shall
communicate the same, together with the amount of interest to be paid in respect
of such interest period and the relevant interest payment date, to the
Corporation, the Trustee, The Depository Trust Company and any paying agent
identified to it in writing as soon as practicable after each determination. The
Calculation Agent will, upon the request of the holder of any Debenture, provide
the interest rate then in effect with respect to such Debenture and, if
determined, the interest rate with respect to such Debenture which will become
effective on the next interest reset date. No amendment to the provisions of the
administrative procedures relating to the duties or obligations of the
Calculation Agent hereunder may become effective without the prior written
consent of the Calculation Agent, which consent shall not be unreasonably
withheld.
<PAGE> 2
2
3. The Calculation Agent accepts its obligations set forth herein,
upon the terms and subject to the conditions hereof, including the following, to
all of which the Corporation agrees:
(a) The Calculation Agent shall be entitled to such compensation as
may be agreed upon with the Corporation for all services rendered by the
Calculation Agent, and the Corporation promises to pay such compensation and to
reimburse the Calculation Agent for the reasonable out-of-pocket expenses
(including attorney's and other professional's fees and expenses) incurred by it
in connection with the services rendered by it hereunder upon receipt of such
invoices as the Corporation shall reasonably require. The Corporation also
agrees to indemnify the Calculation Agent for, and to hold it harmless against,
any and all loss, liability, damage, claim or expense (including the costs and
expenses of defending against any claim of liability) incurred by the
Calculation Agent that arises out of or in connection with its accepting
appointment as, or acting as, Calculation Agent hereunder, except such as may
result from the negligence, willful misconduct or bad faith of the Calculation
Agent or any of its agents or employees. The Calculation Agent shall incur no
liability and shall be indemnified and held harmless by the Corporation for, or
in respect of, any actions taken, omitted to be taken or suffered to be taken in
good faith by the Calculation Agent in reliance upon (i) the opinion or advice
of legal or other professional advisors satisfactory to it or (ii) written
instructions from the Corporation. The Calculation Agent shall not be liable for
any error resulting from the use of or reliance on a source of information used
in good faith and with due care to calculate any interest rate hereunder. The
provisions of this Section shall survive the termination of this Agreement and
the resignation or removal of the Calculation Agent.
(b) In acting under this Agreement and in connection with the
Debentures, the Calculation Agent is acting solely as agent of the Corporation
and does not assume any obligations or relationship of agency or trust for or
with any of the owners or holders of the Debentures.
(c) The Calculation Agent shall be protected and shall incur no
liability for or in respect of any action taken or omitted to be taken or
anything suffered by it in reliance upon the terms of the Debentures, any
notice, direction, certificate, affidavit, statement or other paper, document or
communication reasonably believed by it to be genuine and to have been approved
or signed by the proper party or parties.
(d) The Calculation Agent, its officers, directors, employees and
shareholders may become the owners of, or acquire any interest in, any
Debentures, with the same rights that it or they would have if it were not the
Calculation Agent, and may engage or be interested in any financial or other
transaction with the Corporation as freely as if it were not the Calculation
Agent.
(e) Neither the Calculation Agent nor its officers, directors,
employees, agents or attorneys shall be liable to the Corporation for any act or
omission hereunder, or for any error of judgment made in good faith by it or
them, except in the case of its or their negligence or willful misconduct.
<PAGE> 3
3
(f) The Calculation Agent may consult with counsel (and such counsel
may be counsel to the Corporation or any of its affiliates and may include any
of its employees) and the written advice of such counsel or any opinion of
counsel shall be full and complete authorization and protection in respect of
any action taken, suffered or omitted by it hereunder in good faith and in
reliance thereon.
(g) The Calculation Agent shall be obligated to perform such duties
and only such duties as are herein specifically set forth, and no implied duties
or obligations shall be read into this Agreement against the Calculation Agent.
(h) Unless herein otherwise specifically provided, any order,
certificate, notice, request, direction or other communication from the
Corporation made or given by it under any provision of this Agreement shall be
sufficient if signed by any officer of the Corporation.
(i) The Calculation Agent may, upon obtaining the prior written
consent of the Corporation, perform any duties hereunder either directly or by
or through agents or attorneys, and the Calculation Agent shall not be
responsible for any misconduct or negligence on the part of any agent or
attorney appointed with due care by it hereunder.
(j) The Corporation will not, without first obtaining the prior
written consent of the Calculation Agent, make any change to the Debentures, a
form of which is attached as an exhibit to the Indenture, if such change would
materially and adversely affect the Calculation Agent's duties and obligations
under this Agreement.
4. (a) The Calculation Agent may at any time resign as Calculation
Agent by giving written notice to the Corporation of such intention on its part,
specifying the date on which its desired resignation shall become effective;
provided, however, that such date shall never be earlier than 30 days after the
receipt of such notice by the Corporation, unless the Corporation agrees to
accept less notice. The Calculation Agent may be removed at any time by the
filing with it of any instrument in writing signed on behalf of the Corporation
and specifying such removal and the date when it is intended to become
effective. Such resignation or removal shall take effect upon the date of the
appointment by the Corporation, as hereinafter provided, of a successor
Calculation Agent. If within 30 days after notice of resignation or removal has
been given, a successor Calculation Agent has not been appointed, the
Calculation Agent may petition a court of competent jurisdiction to appoint a
successor Calculation Agent. A successor Calculation Agent shall be appointed by
the Corporation by an instrument in writing signed on behalf of the Corporation
and the successor Calculation Agent. Upon the appointment of a successor
Calculation Agent and acceptance by it of such appointment, the Calculation
Agent so superseded shall cease to be such Calculation Agent hereunder. Upon its
resignation or removal, the Calculation Agent shall be entitled to the payment
by the Corporation of its compensation, if any is owed to it, for services
rendered hereunder and to the reimbursement of all reasonable out-of-pocket
expenses incurred in connection with the services rendered by it hereunder.
<PAGE> 4
4
(b) Any successor Calculation Agent appointed hereunder shall
execute and deliver to its predecessor and to the Corporation an instrument
accepting such appointment hereunder, and thereupon such successor Calculation
Agent, without any further act, deed or conveyance, shall become vested with all
the authority, rights, powers, trusts, immunities, duties and obligations of
such predecessor with like effect as if originally named as such Calculation
Agent hereunder, and such predecessor, upon payment of its charges and
disbursements then unpaid, shall thereupon become obliged to transfer and
deliver, and such successor Calculation Agent shall be entitled to receive,
copies of any relevant records maintained by such predecessor Calculation Agent.
(c) Any corporation into which the Calculation Agent may be merged,
or any corporation with which the Calculation Agent may be merged, or any
corporation with which the Calculation Agent may be consolidated, or any
corporation resulting from any merger or consolidation to which the Calculation
Agent shall sell or otherwise transfer all or substantially all of its assets
and business shall, to the extent permitted by applicable law, be the successor
Calculation Agent under this Agreement without the execution or filing of any
paper or any further act on the part of any of the parties hereto. Notice of any
such merger, consolidation or sale shall forthwith be given to the Corporation
and the Trustee.
5. Any notice required to be given hereunder shall be delivered in
person, sent by letter or telecopy or communicated by telephone (subject, in the
case of communication by telephone, to confirmation dispatched within
twenty-four hours by letter or by telecopy), in the case of the Corporation, to
425 Walnut Street, Cincinnati, Ohio 45202, telephone: (513) 632-4000, telecopy:
(513) 632-5509, Attention: General Counsel, in the case of The First National
Bank of Chicago, to Corporate Trust Services Division, One First National Plaza,
Suite 0126, Chicago, Illinois 60670-0126, telecopy: (312) 407-1708 and, in the
case of The Depository Trust Company, to Manager Announcements, Dividend
Department, The Depository Trust Company, 7 Hanover Square - 22nd Floor, New
York, New York 10004, telecopy: (212) 709-1264 or (212) 709-1263, or to any
other address of which any party shall have notified the others in writing as
herein provided. Any notice hereunder given by telephone, telecopy or letter
shall be deemed to be received when in the ordinary course of transmission or
post, as the case may be, it would be received.
6. This Agreement may be amended only by a writing duly executed and
delivered by each or the parties signing below.
7. This Agreement shall be governed by, and construed in accordance
with, the laws of the State of New York.
8. This Agreement may be executed by each of the parties hereto in
any number of counterparts, each of which counterparts, when so executed and
delivered, shall be deemed to be an original and all such counterparts shall
together constitute one and the same agreement.
<PAGE> 5
5
9. In the event of any conflict relating to the rights or
obligations of the Calculation Agent in connection with the calculation of the
interest rate on the Debentures, the relevant terms of this Agreement shall
govern such rights and obligations.
<PAGE> 6
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed as of the date first above written.
STAR BANC CORPORATION
By: /s/ Bruce Barnes
-------------------------
Name: Bruce Barnes
Title: SVP and Treasurer
THE FIRST NATIONAL BANK OF CHICAGO
By: /s/ John R. Prendiville
--------------------------
Name: John R. Prendiville
Title: Vice President
<PAGE> 1
EXHIBIT 5.1
[LETTERHEAD OF STAR BANC CORPORATION]
August 8, 1997
Star Banc Corporation
425 Walnut Street
Cincinnati, Ohio 45202
Ladies and Gentlemen:
As Senior Vice President, General Counsel and Secretary of
Star Banc Corporation, an Ohio corporation (the "Company"), I am familiar with
the registration statement on Form S-4 (the "Registration Statement") filed
under the Securities Act of 1933, as amended (the "Act"), by the Company, and
Star Capital I, a Delaware statutory business trust (the "Trust"), which
Registration Statement relates to (i) $150,000,000 aggregate liquidation amount
of the Trust's Floating Rate Capital Securities due June 15, 2027 (the "New
Capital Securities"), representing beneficial ownership interests in the Trust,
to be exchanged for up to $150,000,000 of the Trust's outstanding Floating Rate
Capital Securities due June 15, 2027 (the "Old Capital Securities"), (ii)
$150,000,000 aggregate principal amount of the Company's Floating Rate Junior
Subordinated Debentures (the "New Junior Subordinated Debentures") to be issued
by the Company and exchanged for $150,000,000 aggregate principal amount of the
Company's outstanding Floating Rate Junior Subordinated Debentures (the "Old
Junior Subordinated
<PAGE> 2
Star Banc Corporation 2
Debentures") and (iii) an unconditional and irrevocable guarantee (the "New
Guarantee") of the obligations of the Trust under the New Capital Securities to
be issued by the Company and exchanged for the guarantee (the "Old Guarantee")
of the obligations of the Trust under the Old Capital Securities.
I have examined, or caused those acting under my supervision
to have examined, the originals or copies, certified or otherwise identified to
my satisfaction, of (i) the restated charter, as amended, of the Company,
(ii) the bylaws, as amended, of the Company, (iii) minutes of the June 5, 1997
meeting of the Board of Directors of the Company, (iv) the Registration
Statement, (v) the Junior Subordinated Indenture (the "Indenture") between the
Company and The First National Bank of Chicago, as Indenture Trustee, dated as
of June 8, 1997 and filed as an exhibit to the Registration Statement, pursuant
to which the New Junior Subordinated Debentures are to be issued, (vi) the form
of Guarantee Agreement (the "Guarantee Agreement") to be executed by the
Company and The First National Bank of Chicago, as Guarantee Trustee (the
"Guarantee Trustee") relating to the New Guarantee, as filed as an exhibit to
the Registration Statement, and (vii) such other corporate records,
certificates and other documents, and such questions of law, as I have
considered necessary or appropriate for purposes of this opinion. In rendering
such opinion, I have presumed the genuineness of all documents examined and the
accuracy of all statements of fact contained therein.
<PAGE> 3
Star Banc Corporation 3
Upon the basis of such examination and subject to the
limitations contained herein, it is my opinion that:
1. The Company has been duly incorporated and is an
existing corporation in good standing under the laws of the State of
Ohio.
2. The Indenture has been duly authorized and validly
executed and delivered by the Company by its duly authorized officers,
and the issuance and specific terms of the New Junior Subordinated
Debentures have been duly authorized by all necessary corporate action
on the part of the Company.
3. The New Guarantee Agreement has been duly
authorized by all necessary corporate action on the part of the
Company.
The foregoing opinion is limited to the federal laws of the
United States and the laws of the State of Ohio, and I am expressing no opinion
as to the effect of the laws of any other jurisdiction.
In rendering the foregoing opinion, I have relied to the
extent I deem such reliance appropriate as to certain matters on statements
representations and other information obtained from public officials, officers
of the Company and other sources believed by me to be responsible.
I hereby consent to the filing of this opinion as an exhibit
to the Registration Statement and to the reference to me in the Prospectus that
is a part of the Registration Statement. In giving such consent, I do not
thereby admit that I am in the category of persons whose consent is required
under Section 7 of the Act.
Very truly yours,
/s/ Jennie P. Carlson
------------------------
Jennie P. Carlson, Esq.
<PAGE> 1
EXHIBIT 5.2
[LETTERHEAD OF SIMPSON THACHER & BARTLETT]
August 8, 1997
Star Banc Corporation
425 Walnut Street
Cincinnati, Ohio 45202
Ladies and Gentlemen:
This opinion is delivered in connection with the Registration
Statement on Form S-4 (the "Registration Statement") filed under the Securities
Act of 1933, as amended (the "Act"), by Star Banc Corporation, an Ohio
corporation (the "Company"), and Star Capital I, a Delaware statutory business
trust (the "Trust", and together with the Company, the "Registrants"), which
Registration Statement relates to (i) $150,000,000 aggregate liquidation amount
of the Trust's Floating Rate Capital Securities due June 15, 2027 (the "New
Capital Securities"), representing beneficial ownership interests in the Trust,
to be exchanged for $150,000,000 of the Trust's outstanding Floating Rate
Capital Securities due June 15, 2027 (the "Old Capital Securities"), (ii)
$150,000,000 aggregate principal amount of the Company's Floating Rate Junior
Subordinated Debentures (the "New Junior
<PAGE> 2
Star Banc Corporation -2-
Subordinated Debentures") to be issued by the Company and exchanged for
$150,000,000 aggregate principal amount of the Company's outstanding Floating
Rate Junior Subordinated Debentures (the "Old Junior Subordinated Debentures")
and (iii) an unconditional and irrevocable guarantee (the "New Guarantee") of
the obligations of the Trust under the New Capital Securities to be issued by
the Company and exchanged for the Company's outstanding guarantee (the "Old
Guarantee") of the obligations of the Trust under the Old Capital Securities.
We have examined (i) the Registration Statement, (ii) the Junior
Subordinated Indenture (the "Indenture") between the Company and The First
National Bank of Chicago, as Indenture Trustee (the "Indenture Trustee"), dated
as of June 8, 1997 and filed as an exhibit to the Registration Statement,
pursuant to which the New Junior Subordinated Debentures are to be issued, and
(iii) the form of Guarantee Agreement (the "Guarantee Agreement") to be
executed by the Company and The First National Bank of Chicago, as Guarantee
Trustee (the "Guarantee Trustee"), relating to the New Guarantee, as filed as
an exhibit to the Registration Statement. In addition, we have examined, and
have relied as to matters of fact upon, originals or copies, certified or
otherwise identified to our satisfaction, of such corporate records,
agreements, documents and other instruments and such certificates or comparable
documents of public
<PAGE> 3
Star Banc Corporation -3-
officials and of officers and representatives of the Company, and have made such
other and further investigations, as we have deemed relevant and necessary as a
basis for the opinions hereinafter set forth.
In such examination, we have assumed the genuineness of all signatures,
the legal capacity of natural persons, 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. We have also assumed
that the Registration Statement, and any applicable amendments thereto
(including post-effective amendments), will have become effective under the Act
at the time of issuance of such New Capital Securities, New Junior Subordinated
Debentures and New Guarantee.
Based upon the foregoing, and subject to the qualifications and
limitations stated herein, we are of the opinion that:
1. Assuming that the Indenture has been duly authorized,
executed and delivered by the Company and the Indenture Trustee and
that the issuance and specific terms of the New Junior Subordinated
Debentures have been duly authorized by all necessary corporate action
on the part of the Company, when such New Junior Subordinated
Debentures have been duly executed, authenticated, issued and delivered
in accordance with the provisions of the Indenture upon exchange of the
Old Junior Subordinated Debentures as contemplated by the Registration
Statement, such New Junior Subordinated Debentures will constitute
valid and legally binding obligations of the Company, enforceable
against the Company in accordance with their terms.
<PAGE> 4
Star Banc Corporation -4-
2. Assuming that the Company has taken all necessary corporate
action to authorize the issuance of the New Guarantee, when the
Guarantee Agreement has been duly executed and delivered by the Company
and the Guarantee Trustee, the New Guarantee will constitute a valid
and legally binding obligation of the Company, enforceable against the
Company in accordance with its terms.
Our opinions set forth in paragraphs 1 and 2 above are subject to
the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a proceeding in
equity or at law) and an implied covenant of good faith and fair dealing.
We are members of the Bar of the State of New York and we do not
express any opinion herein concerning any law other than the law of the State of
New York and the federal law of the United States.
We hereby consent to the filing of this opinion letter as an
exhibit to the Registration Statement and to the reference to us under the
caption "Legal Matters" in the Prospectus forming a part of the Registration
Statement.
Very truly yours,
/s/ SIMPSON THACHER & BARTLETT
------------------------------
SIMPSON THACHER & BARTLETT
<PAGE> 1
EXHIBIT 5.3
[Letterhead of Richards, Layton & Finger]
August 8, 1997
Star Capital I
c/o Star Banc Corporation
425 Walnut Street
Cincinnati, Ohio 45202
RE: STAR CAPITAL I
Ladies and Gentlemen:
We have acted as special Delaware counsel for Star Banc
Corporation, a Delaware corporation (the "Company"), and Star Capital I, a
Delaware business trust (the "Trust"), in connection with the matters set forth
herein. At your request, this opinion is being furnished to you.
For purposes of giving the opinions hereinafter set forth, our
examination of documents has been limited to the examination of originals or
copies of the following:
(a) The Restated Certificate of Trust of the Trust, dated as
of June 8, 1997 (the "Certificate"), as filed in the office of the Secretary of
State of the State of Delaware (the "Secretary of State") on June 10, 1997;
(b) The Declaration of Trust of the Trust, dated as of June 5,
1997, among the Company and the trustees of the Trust named therein;
<PAGE> 2
Star Capital I
August 8, 1997
Page 2
(c) The Amended and Restated Declaration of Trust of the
Trust, dated as of June 8, 1997, including Exhibits A and B thereto (the
"Declaration"), among the Company, as sponsor, the trustees of the Trust named
therein, and the holders, from time to time, of undivided beneficial interests
in the assets of the Trust;
(d) The Registration Statement on Form S-4 (the "Registration
Statement"), including a preliminary prospectus (the "Prospectus"), relating to
the exchange of up to $150,000,000 aggregate liquidation amount of Floating Rate
Capital Securities of the Trust (each, an "Exchange Capital Security" and
collectively, the "Exchange Capital Securities") for a like liquidation amount
of outstanding Floating Rate Capital Securities of the Trust, as proposed to be
filed by the Company and the Trust with the Securities and Exchange Commission
on or about August 8, 1997; and
(e) A Certificate of Good Standing for the Trust, dated August
8, 1997, obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise
defined are used as defined in the Declaration.
For purposes of this opinion, we have not reviewed any
documents other than the documents listed in paragraphs (a) through (e) above.
In particular, we have not reviewed any document (other than the documents
listed in paragraphs (a) through (e) above) that is referred to in or
incorporated by reference into the documents reviewed by us. We have assumed
that there exists no provision in any document that we have not reviewed that is
inconsistent with the opinions stated herein. We have conducted no independent
factual investigation of our own but rather have relied solely upon the
foregoing documents, the statements and information set forth therein and the
additional matters recited or assumed herein, all of which we have assumed to be
true, complete and accurate in all material respects.
With respect to all documents examined by us, we have assumed
(i) the authenticity of all documents submitted to us as authentic originals,
(ii) the conformity with the originals of all documents submitted to us as
copies or forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the
Declaration constitutes the entire agreement among the parties thereto with
respect to the subject matter thereof, including with respect to the creation,
operation and termination of the Trust, and that the Declaration and the
Certificate are in full force and effect and have not been amended, (ii) except
to the extent provided in paragraph 1 below, the due creation or due
organization or due formation, as the case may be, and valid existence in good
<PAGE> 3
Star Capital I
August 8, 1997
Page 3
standing of each party to the documents examined by us under the laws of the
jurisdiction governing its creation, organization or formation, (iii) the legal
capacity of natural persons who are parties to the documents examined by us,
(iv) that each of the parties to the documents examined by us has the power and
authority to execute and deliver, and to perform its obligations under, such
documents, (v) the due authorization, execution and delivery by all parties
thereto of all documents examined by us, (vi) the receipt by each Person to whom
an Exchange Capital Security is to be issued by the Trust (collectively, the
"Exchange Capital Security Holders") of a certificate evidencing the Exchange
Capital Security and the consideration for the Exchange Capital Security
acquired by it, in accordance with the Declaration, and as described in the
Registration Statement, and (vii) that the Exchange Capital Securities are
issued to the Exchange Capital Security Holders in accordance with the
Declaration, and as described in the Registration Statement. We have not
participated in the preparation of the Registration Statement and assume no
responsibility for its contents.
This opinion is limited to the laws of the State of Delaware
(excluding the securities laws of the State of Delaware), and we have not
considered and express no opinion on the laws of any other jurisdiction,
including federal laws and rules and regulations relating thereto. Our opinions
are rendered only with respect to Delaware laws and rules, regulations and
orders thereunder that are currently in effect.
Based upon the foregoing, and upon our examination of such
questions of law and statutes of the State of Delaware as we have considered
necessary or appropriate, and subject to the assumptions, qualifications,
limitations and exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing in
good standing as a business trust under the Delaware Business Trust Act, 12 Del.
C. Section 3801, et seq.
2. The Exchange Capital Securities will represent valid and,
subject to the qualifications set forth in paragraph 3 below, fully paid and
nonassessable undivided beneficial interests in the assets of the Trust.
3. The Exchange Capital Security Holders, as beneficial owners
of the Trust, will be entitled to the same limitation of personal liability
extended to stockholders of private corporations for profit organized under the
General Corporation Law of the State of Delaware. We note that the Exchange
Capital Security Holders may be obligated to make payments as set forth in the
Declaration.
<PAGE> 4
Star Capital I
August 8, 1997
Page 4
We consent to the filing of this opinion with the Securities
and Exchange Commission as an exhibit to the Registration Statement. We also
consent to Simpson Thacher & Bartlett's relying as to matters of Delaware law
upon this opinion in connection with an opinion to be rendered by it as
described in the Prospectus. In addition, we hereby consent to the use of our
name under the heading "Legal Matters" in the Prospectus. In giving the
foregoing consents, we do not thereby admit that we come within the category of
Persons whose consent is required under Section 7 of the Securities Act of 1933,
as amended, or the rules and regulations of the Securities and Exchange
Commission thereunder. Except as stated above, without our prior written
consent, this opinion may not be furnished or quoted to, or relied upon by, any
other Person for any purpose.
Very truly yours,
/s/ Richards Layton & Finger
----------------------------
GCK/aet
<PAGE> 1
EXHIBIT 8.1
[SIMPSON THACHER & BARTLETT LETTERHEAD]
August 8, 1997
Re: Offer to Exchange Registered Floating Rate Capital
Securities for the Outstanding Unregistered
Floating Rate Capital Securities
Star Banc Corporation
425 Walnut Street
Cincinnati, Ohio 45202
Star Capital I
c/o Star Banc Corporation
425 Walnut Street
Cincinnati, Ohio 45202
Ladies and Gentlemen:
We have acted as special United States federal income tax counsel
("Tax Counsel") to Star Banc Corporation, a bank holding company organized under
the laws of the State of Ohio (the "Company"), and Star Capital I, a statutory
business trust organized under the Business Trust Act of the State of Delaware
(the "Trust"), in connection with the preparation and filing by the Company and
the Trust with the Securities and Exchange Commission (the "Commission") of a
Registration Statement on Form S-4 (as amended, the "Registration Statement")
under the Securities Act of 1933, as amended (the "Securities Act"), registering
the exchange (referred to collectively herein as the "Exchange"), of: (i) up to
$150,000,000 aggregate liquidation amount of Floating Rate Capital Securities
(the "New Capital Securities"), which will
<PAGE> 2
Star Banc Corporation -2- August 8, 1997
have been registered under the Securities Act pursuant to the Registration
Statement, for a like liquidation amount of the Trust's outstanding Floating
Rate Capital Securities (the "Old Capital Securities"); (ii) the Company's
guarantee (which is set forth in the Guarantee Agreement, dated as of June 8,
1997, between the Company and The First National Bank of Chicago, as trustee
(the "Old Guarantee Trustee")), of the payment of distributions and payments
upon liquidation or redemption of the Trust Securities (the "Old Guarantee") for
a like guarantee (which will be set forth in a new Guarantee Agreement between
the Company and The First National Bank of Chicago, as trustee (the "New
Guarantee Trustee")) of the Trust Securities (the "New Guarantee"), which will
have been registered under the Securities Act pursuant to the Registration
Statement; and (iii) all of the Company's outstanding Floating Rate Junior
Subordinated Debentures (the "Old Junior Subordinated Debentures") for a like
aggregate principal amount of Floating Rate Junior Subordinated Debentures (the
"New Junior Subordinated Debentures"), which will have been registered under the
Securities Act pursuant to the Registration Statement.
All capitalized terms used in this opinion letter and not
otherwise defined herein shall have the meaning ascribed to such terms in the
Registration Statement.
In delivering this opinion letter, we have reviewed and relied
upon: (i) the Registration Statement; (ii) the
<PAGE> 3
Star Banc Corporation -3- August 8, 1997
Indenture, dated as of June 8, 1997 (the "Indenture"), between the Company and
The First National Bank of Chicago, as trustee (the "Indenture Trustee"); (iii)
forms of the Old Junior Subordinated Debentures and the New Junior Subordinated
Debentures; (iv) the Amended and Restated Declaration of Trust, dated as of June
8, 1997 (the "Declaration"), among the Company, as Depositor, The First National
Bank of Chicago, as the initial Property Trustee, First Chicago Delaware Inc.,
as the initial Delaware Trustee and the Regular Trustees named therein; (v) the
Old Guarantee and a form of the New Guarantee; and (vi) forms of the Trust
Securities. Further, we have relied upon certain other statements and
representations contained in the Company's letter of representation dated June
8, 1997. We also have examined and relied upon originals or copies, certified or
otherwise identified to our satisfaction, of such records of the Company and the
Trust and such other documents, certificates and records as we have deemed
necessary or appropriate as a basis for the opinions set forth herein.
In our examination of such material, we have assumed the
genuineness of all signatures, the authenticity of all documents submitted to us
as originals and the conformity to original documents of all copies of documents
submitted to us. In addition, we also have assumed that (i) the transactions
related to the original issuance of the Old Junior Subordinated Debentures, the
Old Capital Securities and the
<PAGE> 4
Star Banc Corporation -4- August 8, 1997
Common Securities were consummated in accordance with the terms of the documents
and forms of documents described herein and (ii) the Exchange will be
consummated in accordance with the terms of such documents and forms of
documents.
On the basis of the foregoing and assuming that the Trust was
formed and will be maintained in compliance with the terms of the Declaration,
we hereby confirm (i) our opinions set forth in the Registration Statement under
the caption "Certain United States Federal Income Tax Consequences" and (ii)
that, subject to the qualifications set forth therein, the discussion set forth
in the Registration Statement under such caption is an accurate summary of the
United States federal income tax matters described therein.
We express no opinion with respect to the transactions referred
to herein or in the Registration Statement other than as expressly set forth
herein. Moreover, we note that there is no authority directly on point dealing
with securities such as the Trust Securities or transactions of the type
described herein and that our opinion is not binding on the Internal Revenue
Service or the courts, either of which could take a contrary position.
Nevertheless, we believe that if challenged, the opinions we express herein
would be sustained by a court with jurisdiction in a properly presented case.
<PAGE> 5
Star Banc Corporation -5- August 8, 1997
Our opinion is based upon the Code, the Treasury regulations
promulgated thereunder and other relevant authorities and law, all as in effect
on the date hereof. Consequently, future changes in the law may cause the tax
treatment of the transactions referred to herein to be materially different from
that described above.
We are admitted to practice law only in the State of New York and
the opinions we express herein are limited solely to matters governed by the
federal law of the United States.
<PAGE> 6
Star Banc Corporation -6- August 8, 1997
We hereby consent to the use of this opinion for filing as
Exhibit 8.1 to the Registration Statement and the use of our name in the
Registration Statement under the captions "Certain United States Federal Income
Tax Consequences" and "Legal Matters".
Very truly yours,
/s/ SIMPSON THACHER & BARTLETT
SIMPSON THACHER & BARTLETT
<PAGE> 1
RATIO OF EARNINGS TO FIXED CHARGES AND Exhibit 12.1
RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
AS OF JUNE 30, 1997
<TABLE>
<CAPTION>
SIX MONTHS YEAR ENDED DECEMBER 31,
ENDED -----------------------------------------------------------------
06/30/97 1996 1995 1994 1993 1992
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
INCOME BEFORE INCOME TAXES $139,373 $239,736 $205,017 $178,438 $152,509 $114,118
INTEREST ON DEPOSITS 131,719 262,675 265,972 175,220 170,922 210,339
FIXED CHARGES:
Interest expense on short-term borrowings 23,718 42,999 55,227 39,081 17,752 16,883
Interest expense on long-term debt 9,168 11,652 10,997 9,317 6,017 5,816
Premium/(discount) on debt 180 293 205 (1,795) -- --
Interest portion of net rental expense 1,417 2,528 2,457 2,743 2,653 2,662
-------- -------- -------- -------- -------- --------
Total fixed charges 34,483 57,472 68,886 49,346 26,422 25,361
Preferred stock dividend requirement:
Preferred stock dividends paid -- 5 76 321 1,084 1,146
Pre-tax earnings required to pay dividends -- 8 114 492 1,650 1,718
RATIO OF EARNINGS TO FIXED CHARGES
Excluding interest on deposits
Earnings before fixed charges 173,856 297,208 273,903 227,784 178,931 139,479
Fixed charges 34,483 57,472 68,886 49,346 26,422 25,361
Ratio 5.04 5.17 3.98 4.62 6.77 5.50
Including interest on deposits
Earnings before fixed charges and interest 305,575 559,883 539,875 403,004 349,853 349,818
Fixed charges 166,202 320,147 334,858 224,566 197,344 235,700
Ratio 1.84 1.75 1.61 1.79 1.77 1.48
RATIO OF EARNINGS TO COMBINED FIXED CHARGES
AND PREFERRED STOCK DIVIDEND REQUIREMENTS
Excluding interest on deposits
Earnings before fixed charges 173,856 297,216 274,017 228,276 180,581 141,197
Fixed charges 34,483 57,480 69,000 49,838 28,072 27,079
Ratio 5.04 5.17 3.97 4.58 6.43 5.21
Including interest on deposits
Earnings before fixed charges and interest 305,575 559,891 539,989 403,496 351,503 351,536
Fixed charges 166,202 320,155 334,972 225,058 198,994 237,418
Ratio 1.84 1.75 1.61 1.79 1.77 1.48
</TABLE>
<PAGE> 1
Exhibit 23.1
Consent of Independent Public Accountants
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our report dated January 13, 1997
incorporated by reference in Star Banc Corporation's Form 10-K for the year
ended December 31, 1996 and Form 8-K filed March 12, 1997, respectively, and to
all references to our Firm included in this registration statement.
ARTHUR ANDERSEN LLP
Cincinnati, Ohio
August 6, 1997
<PAGE> 1
EXHIBIT 25.1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
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 FIRST NATIONAL BANK OF CHICAGO
(Exact name of trustee as specified in its charter)
A National Banking Association 36-0899825
(I.R.S. employer
identification number)
One First National Plaza, Chicago, Illinois 60670-0126
(Address of principal executive offices) (Zip Code)
The First National Bank of Chicago
One First National Plaza, Suite 0286
Chicago, Illinois 60670-0286
Attn: Lynn A. Goldstein, Law Department (312) 732-6919
(Name, address and telephone number of agent for service)
Star Banc Corporation
(Exact name of obligor as specified in its charter)
Ohio 31-0838189
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
425 Walnut Street
Cincinnati, Ohio 45202
(Address of principal executive offices) (Zip Code)
Junior Subordinated Debentures
(Title of Indenture Securities)
<PAGE> 2
ITEM 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.
Comptroller of Currency, Washington, D.C., Federal Deposit
Insurance Corporation, Washington, D.C., The Board of Governors
of the Federal Reserve System, Washington D.C.
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
The trustee is authorized to exercise corporate trust powers.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR. IF THE OBLIGOR IS AN AFFILIATE OF
THE TRUSTEE, DESCRIBE EACH SUCH AFFILIATION.
No such affiliation exists with the trustee.
ITEM 16. LIST OF EXHIBITS. LIST BELOW ALL EXHIBITS FILED AS A PART OF THIS
STATEMENT OF ELIGIBILITY.
1. A copy of the articles of association of the trustee now in
effect.*
2. A copy of the certificates of authority of the trustee to
commence business.*
3. A copy of the authorization of the trustee to exercise
corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by Section 321(b) of the
Act.
7. A copy of the latest report of condition of the trustee
published pursuant to law or the requirements of its
supervising or examining authority.
2
<PAGE> 3
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national banking
association organized and existing under the laws of the United States of
America, has duly caused this Statement of Eligibility to be signed on its
behalf by the undersigned, thereunto duly authorized, all in the City of Chicago
and the State of Illinois, on this 6th day of August, 1997.
THE FIRST NATIONAL BANK OF CHICAGO,
TRUSTEE
By /s/ John R. Prendiville
-------------------------------
John R. Prendiville
Vice President
* EXHIBIT 1, 2, 3 AND 4 ARE HEREIN INCORPORATED BY REFERENCE TO EXHIBITS BEARING
IDENTICAL NUMBERS IN ITEM 16 OF THE FORM T-1 OF THE FIRST NATIONAL BANK OF
CHICAGO, FILED AS EXHIBIT 25.1 TO THE REGISTRATION STATEMENT ON FORM S-3 OF
SUNAMERICA, INC., FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER
25, 1996 (REGISTRATION NO. 333-14201).
3
<PAGE> 4
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
August 6, 1997
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of an indenture between Star
Banc Corporation and The First National Bank of Chicago, the undersigned, in
accordance with Section 321(b) of the Trust Indenture Act of 1939, as amended,
hereby consents that the reports of examinations of the undersigned, made by
Federal or State authorities authorized to make such examinations, may be
furnished by such authorities to the Securities and Exchange Commission upon its
request therefor.
Very truly yours,
THE FIRST NATIONAL BANK OF CHICAGO
By /s/ John R. Prendiville
-------------------------------
John R. Prendiville
Vice President
4
<PAGE> 5
EXHIBIT 7
<TABLE>
<S> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 03/31/97 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0303 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
</TABLE>
CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR MARCH 31, 1997
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.
SCHEDULE RC--BALANCE SHEET
<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN C400
THOUSANDS RCFD BIL MIL THOU
----------------- ---- ------------
<S> <C> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A):
a. Noninterest-bearing balances and currency and coin(1)............. 0081 3,871,170 1.a.
b. Interest-bearing balances(2)...................................... 0071 6,498,314 1.b.
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A)......... 1754 0 2.a.
b. Available-for-sale securities (from Schedule RC-B, column D)...... 1773 3,901,208 2.b.
3. Federal funds sold and securities purchased under agreements to
resell 1350 4,612,975 3.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule
RC-C)................................................................ RCFD 2122 23,345,201 4.a.
b. LESS: Allowance for loan and lease losses......................... RCFD 3123 420,963 4.b.
c. LESS: Allocated transfer risk reserve............................. RCFD 3128 0 4.c.
d. Loans and leases, net of unearned income, allowance, and
reserve (item 4.a minus 4.b and 4.c).............................. 2125 22,924,238 4.d.
5. Trading assets (from Schedule RD-D).................................. 3545 8,792,158 5.
6. Premises and fixed assets (including capitalized leases)............. 2145 706,928 6.
7. Other real estate owned (from Schedule RC-M)......................... 2150 6,563 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)....................................... 2130 61,551 8.
9. Customers' liability to this bank on acceptances outstanding......... 2155 488,866 9.
10. Intangible assets (from Schedule RC-M)............................... 2143 291,569 10.
11. Other assets (from Schedule RC-F).................................... 2160 1,775,283 11.
12. Total assets (sum of items 1 through 11)............................. 2170 53,930,823 12.
</TABLE>
- ----------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
5
<PAGE> 6
<TABLE>
<S> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 03/31/97 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0303 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
</TABLE>
SCHEDULE RC-CONTINUED
<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN
THOUSANDS BIL MIL THOU
------------------ ------------
<S> <C> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C
from Schedule RC-E, part 1).................................... RCON 2200 21,550,056 13.a.
(1) Noninterest-bearing(1)..................................... RCON 6631 8,895,137 13.a.1
(2) Interest-bearing........................................... RCON 6636 12,654,919 13.a.2
b. In foreign offices, Edge and Agreement subsidiaries, and
IBFs (from Schedule RC-E, part II)................. RCFN 2200 12,364,650 13.b.
(1) Noninterest bearing........................................ RCFN 6631 287,496 13.b.1
(2) Interest-bearing........................................... RCFN 6636 12,077,154 13.b.2
14. Federal funds purchased and securities sold under agreements
to repurchase: RCFD 2800 3,817,421 14
15. a. Demand notes issued to the U.S. Treasury RCON 2840 63,621 15.a.
b. Trading Liabilities(from Schedule RC-D)........................ RCFD 3548 5,872,831 15b.
16. Other borrowed money:
a. With original maturity of one year or less..................... RCFD 2332 2,607,549 16.a.
b. With original maturity of more than one year.................. RCFD 2333 322,414 16b.
17. Not applicable
18. Bank's liability on acceptance executed and outstanding........... RCFD 2920 488,866 18.
19. Subordinated notes and debentures................................. RCFD 3200 1,550,000 19.
20. Other liabilities (from Schedule RC-G)............................ RCFD 2930 1,196,229 20.
21. Total liabilities (sum of items 13 through 20).................... RCFD 2948 49,833,637 21.
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus..................... RCFD 3838 0 23.
24. Common stock...................................................... RCFD 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock).......... RCFD 3839 2,944,244 25.
26. a. Undivided profits and capital reserves......................... RCFD 3632 954,885 26.a.
b. Net unrealized holding gains (losses) on available-for-sale
securities..................................................... RCFD 8434 (1,089) 26.b.
27. Cumulative foreign currency translation adjustments............... RCFD 3284 (1,712) 27.
28. Total equity capital (sum of items 23 through 27)................. RCFD 3210 4,097,186 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28)............................. RCFD 3300 53,930,823 29.
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
<TABLE>
<S> <C> <C> <C>
1. Indicate in the box at the right the number of the statement below that Number
best describes the most comprehensive level of auditing work performed for ------
the bank by independent external auditors as of any date during 1996 .......... RCFD 6724 ... 2 M.1.
------
</TABLE>
1 = Independent audit of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm which
submits a report on the bank
2 = Independent audit of the bank's parent holding company conducted in
accordance with generally accepted auditing standards by a certified
public accounting firm which submits a report on the consolidated holding
company (but not on the bank separately)
3 = Directors' examination of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm (may be
required by state chartering authority)
4 = Directors' examination of the bank performed by other external auditors
(may be required by state chartering authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
- ----------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
6
<PAGE> 1
EXHIBIT 25.2
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
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 FIRST NATIONAL BANK OF CHICAGO
(Exact name of trustee as specified in its charter)
A National Banking Association 36-0899825
(I.R.S. employer
identification number)
One First National Plaza, Chicago, Illinois 60670-0126
(Address of principal executive offices) (Zip Code)
The First National Bank of Chicago
One First National Plaza, Suite 0286
Chicago, Illinois 60670-0286
Attn: Lynn A. Goldstein, Law Department (312) 732-6919
(Name, address and telephone number of agent for service)
Star Banc Corporation
(Exact name of obligor as specified in its charter)
Ohio 31-0838189
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
425 Walnut Street
Cincinnati, Ohio 45202
(Address of principal executive offices) (Zip Code)
Guarantee of Capital Securities of Star Capital I
(Title of Indenture Securities)
<PAGE> 2
ITEM 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.
Comptroller of Currency, Washington, D.C., Federal Deposit
Insurance Corporation, Washington, D.C., The Board of Governors
of the Federal Reserve System, Washington D.C.
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
The trustee is authorized to exercise corporate trust powers.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR. IF THE OBLIGOR IS AN AFFILIATE OF
THE TRUSTEE, DESCRIBE EACH SUCH AFFILIATION.
No such affiliation exists with the trustee.
ITEM 16. LIST OF EXHIBITS. LIST BELOW ALL EXHIBITS FILED AS A PART OF THIS
STATEMENT OF ELIGIBILITY.
1. A copy of the articles of association of the trustee now in
effect.*
2. A copy of the certificates of authority of the trustee to
commence business.*
3. A copy of the authorization of the trustee to exercise
corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by Section 321(b) of the
Act.
7. A copy of the latest report of condition of the trustee
published pursuant to law or the requirements of its
supervising or examining authority.
2
<PAGE> 3
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national banking
association organized and existing under the laws of the United States of
America, has duly caused this Statement of Eligibility to be signed on its
behalf by the undersigned, thereunto duly authorized, all in the City of Chicago
and the State of Illinois, on this 6th day of August, 1997.
THE FIRST NATIONAL BANK OF CHICAGO,
TRUSTEE
By /s/ John R. Prendiville
-----------------------
John R. Prendiville
Vice President
* EXHIBIT 1, 2, 3 AND 4 ARE HEREIN INCORPORATED BY REFERENCE TO EXHIBITS BEARING
IDENTICAL NUMBERS IN ITEM 16 OF THE FORM T-1 OF THE FIRST NATIONAL BANK OF
CHICAGO, FILED AS EXHIBIT 25.1 TO THE REGISTRATION STATEMENT ON FORM S-3 OF
SUNAMERICA, INC., FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER
25, 1996 (REGISTRATION NO. 333-14201).
3
<PAGE> 4
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
August 6, 1997
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of an indenture between
Star Banc Corporation and The First National Bank of Chicago, the undersigned,
in accordance with Section 321(b) of the Trust Indenture Act of 1939, as
amended, hereby consents that the reports of examinations of the undersigned,
made by Federal or State authorities authorized to make such examinations, may
be furnished by such authorities to the Securities and Exchange Commission upon
its request therefor.
Very truly yours,
THE FIRST NATIONAL BANK OF CHICAGO
By /s/ John R. Prendiville
----------------------------------
John R. Prendiville
Vice President
4
<PAGE> 5
EXHIBIT 7
<TABLE>
<S> <C> <C> <C>
<CAPTION>
Legal Title of Bank: The First National Bank of Chicago Call Date: 03/31/97 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0303 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
</TABLE>
CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR MARCH 31, 1997
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.
SCHEDULE RC--BALANCE SHEET
<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN C400
THOUSANDS RCFD BIL MIL THOU
--------- ---- ------------
<S> <C> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A):
a. Noninterest-bearing balances and currency and coin(1).............. 0081 3,871,170 1.a.
b. Interest-bearing balances(2)....................................... 0071 6,498,314 1.b.
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A).......... 1754 0 2.a.
b. Available-for-sale securities (from Schedule RC-B, column D)....... 1773 3,901,208 2.b.
3. Federal funds sold and securities purchased under agreements to
resell 1350 4,612,975 3.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule
RC-C)................................................................. RCFD 2122 23,345,201 4.a.
b. LESS: Allowance for loan and lease losses.......................... RCFD 3123 420,963 4.b.
c. LESS: Allocated transfer risk reserve.............................. RCFD 3128 0 4.c.
d. Loans and leases, net of unearned income, allowance, and
reserve (item 4.a minus 4.b and 4.c)............................... 2125 22,924,238 4.d.
5. Trading assets (from Schedule RD-D)................................... 3545 8,792,158 5.
6. Premises and fixed assets (including capitalized leases).............. 2145 706,928 6.
7. Other real estate owned (from Schedule RC-M).......................... 2150 6,563 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)........................................ 2130 61,551 8.
9. Customers' liability to this bank on acceptances outstanding.......... 2155 488,866 9.
10. Intangible assets (from Schedule RC-M)................................ 2143 291,569 10.
11. Other assets (from Schedule RC-F)..................................... 2160 1,775,283 11.
12. Total assets (sum of items 1 through 11).............................. 2170 53,930,823 12.
</TABLE>
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
5
<PAGE> 6
<TABLE>
<S> <C> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 03/31/97 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0303 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
</TABLE>
SCHEDULE RC-CONTINUED
<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN
THOUSANDS BIL MIL THOU
--------- ------------
<S> <C> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C
from Schedule RC-E, part 1)................................ RCON 2200 21,550,056 13.a.
(1) Noninterest-bearing(1)................................. RCON 6631 8,895,137 13.a.1
(2) Interest-bearing....................................... RCON 6636 12,654,919 13.a.2
b. In foreign offices, Edge and Agreement subsidiaries, and
IBFs (from Schedule RC-E, part II)......................... RCFN 2200 12,364,650 13.b.
(1) Noninterest bearing.................................... RCFN 6631 287,496 13.b.1
(2) Interest-bearing....................................... RCFN 6636 12,077,154 13.b.2
14. Federal funds purchased and securities sold under agreements
to repurchase: RCFD 2800 3.817,421 14
15. a. Demand notes issued to the U.S. Treasury RCON 2840 63,621 15.a.
b. Trading Liabilities(from Schedule RC-D).................... RCFD 3548 5,872,831 15b.
16. Other borrowed money:
a. With original maturity of one year or less................. RCFD 2332 2,607,549 16.a.
b. With original maturity of more than one year.............. RCFD 2333 322,414 16b.
17. Not applicable
18. Bank's liability on acceptance executed and outstanding....... RCFD 2920 488,866 18.
19. Subordinated notes and debentures............................. RCFD 3200 1,550,000 19.
20. Other liabilities (from Schedule RC-G)........................ RCFD 2930 1,196,229 20.
21. Total liabilities (sum of items 13 through 20)................ RCFD 2948 49,833,637 21.
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus................. RCFD 3838 0 23.
24. Common stock.................................................. RCFD 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock)...... RCFD 3839 2,944,244 25.
26. a. Undivided profits and capital reserves....................... RCFD 3632 954,885 26.a.
b. Net unrealized holding gains (losses) on available-for-sale
securities................................................. RCFD 8434 (1,089) 26.b.
27. Cumulative foreign currency translation adjustments........... RCFD 3284 (1,712) 27.
28. Total equity capital (sum of items 23 through 27)............. RCFD 3210 4,097,186 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28)......................... RCFD 3300 53,930,823 29.
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the statement
below that best describes the most comprehensive level of
auditing work performed for the bank by independent external
Number
auditors as of any date during 1996 . . . . . RCFD 6724 .. 2 M.1.
1 = Independent audit of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm which
submits a report on the bank
2 = Independent audit of the bank's parent holding company conducted in
accordance with generally accepted auditing standards by a certified public
accounting firm which submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm (may be
required by state chartering authority)
4 = Directors' examination of the bank performed by other external auditors
(may be required by state chartering authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
(1) Includes total demand deposits and noninterest-bearing time
and savings deposits.
6
<PAGE> 1
EXHIBIT 25.3
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
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 FIRST NATIONAL BANK OF CHICAGO
(Exact name of trustee as specified in its charter)
A National Banking Association 36-0899825
(I.R.S. employer
identification number)
One First National Plaza, Chicago, Illinois 60670-0126
(Address of principal executive offices) (Zip Code)
The First National Bank of Chicago
One First National Plaza, Suite 0286
Chicago, Illinois 60670-0286
Attn: Lynn A. Goldstein, Law Department (312) 732-6919
(Name, address and telephone number of agent for service)
Star Capital I
(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 number)
425 Walnut Street
Cincinnati, Ohio 45202
(Address of principal executive offices) (Zip Code)
Capital Securities
(Title of Indenture Securities)
<PAGE> 2
ITEM 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.
Comptroller of Currency, Washington, D.C., Federal
Deposit Insurance Corporation, Washington, D.C., The
Board of Governors of the Federal Reserve System,
Washington D.C.
(b) WHETHER IT IS AUTHORIZED TO EXERCISE
CORPORATE TRUST POWERS.
The trustee is authorized to exercise corporate trust
powers.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR. IF THE OBLIGOR
IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH
SUCH AFFILIATION.
No such affiliation exists with the trustee.
ITEM 16. LIST OF EXHIBITS. LIST BELOW ALL EXHIBITS FILED AS A
PART OF THIS STATEMENT OF ELIGIBILITY.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
2
<PAGE> 3
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national banking
association organized and existing under the laws of the United States of
America, has duly caused this Statement of Eligibility to be signed on its
behalf by the undersigned, thereunto duly authorized, all in the City of Chicago
and the State of Illinois, on this 6th day of August, 1997.
THE FIRST NATIONAL BANK OF CHICAGO,
TRUSTEE
By /s/ John R. Prendiville
-------------------------------
John R. Prendiville
Vice President
* EXHIBIT 1, 2, 3 AND 4 ARE HEREIN INCORPORATED BY REFERENCE TO EXHIBITS BEARING
IDENTICAL NUMBERS IN ITEM 16 OF THE FORM T-1 OF THE FIRST NATIONAL BANK OF
CHICAGO, FILED AS EXHIBIT 25.1 TO THE REGISTRATION STATEMENT ON FORM S-3 OF
SUNAMERICA, INC., FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER
25, 1996 (REGISTRATION NO. 333-14201).
3
<PAGE> 4
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
August 6, 1997
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of an indenture between Star
Capital I and The First National Bank of Chicago, the undersigned, in accordance
with Section 321(b) of the Trust Indenture Act of 1939, as amended, hereby
consents that the reports of examinations of the undersigned, made by Federal or
State authorities authorized to make such examinations, may be furnished by such
authorities to the Securities and Exchange Commission upon its request therefor.
Very truly yours,
THE FIRST NATIONAL BANK OF CHICAGO
By /s/ John R. Prendiville
------------------------------------
John R. Prendiville
Vice President
4
<PAGE> 5
EXHIBIT 7
<TABLE>
<S> <C> <C> <C>
<CAPTION>
Legal Title of Bank: The First National Bank of Chicago Call Date: 03/31/97 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0303 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
</TABLE>
CONSOLIDATED REPORT OF CONDITION FOR INSURED COMMERCIAL
AND STATE-CHARTERED SAVINGS BANKS FOR MARCH 31, 1997
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.
SCHEDULE RC--BALANCE SHEET
<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN C400
THOUSANDS RCFD BIL MIL THOU
--------- ---- ------------
<S> <C> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule
RC-A):
a. Noninterest-bearing balances and currency and coin(1).............. 0081 3,871,170 1.a.
b. Interest-bearing balances(2)....................................... 0071 6,498,314 1.b.
2. Securities
a. Held-to-maturity securities(from Schedule RC-B, column A).......... 1754 0 2.a.
b. Available-for-sale securities (from Schedule RC-B, column D)....... 1773 3,901,208 2.b.
3. Federal funds sold and securities purchased under agreements to
resell 1350 4,612,975 3.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule
RC-C)................................................................. RCFD 2122 23,345,201 4.a.
b. LESS: Allowance for loan and lease losses.......................... RCFD 3123 420,963 4.b.
c. LESS: Allocated transfer risk reserve.............................. RCFD 3128 0 4.c.
d. Loans and leases, net of unearned income, allowance, and
reserve (item 4.a minus 4.b and 4.c)............................... 2125 22,924,238 4.d.
5. Trading assets (from Schedule RD-D)................................... 3545 8,792,158 5.
6. Premises and fixed assets (including capitalized leases).............. 2145 706,928 6.
7. Other real estate owned (from Schedule RC-M).......................... 2150 6,563 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)........................................ 2130 61,551 8.
9. Customers' liability to this bank on acceptances outstanding.......... 2155 488,866 9.
10. Intangible assets (from Schedule RC-M)................................ 2143 291,569 10.
11. Other assets (from Schedule RC-F)..................................... 2160 1,775,283 11.
12. Total assets (sum of items 1 through 11).............................. 2170 53,930,823 12.
</TABLE>
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
5
<PAGE> 6
<TABLE>
<S> <C> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 03/31/97 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0303 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
</TABLE>
SCHEDULE RC-CONTINUED
<TABLE>
<CAPTION>
DOLLAR AMOUNTS IN
THOUSANDS BIL MIL THOU
--------- ------------
<S> <C> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C
from Schedule RC-E, part 1)................................ RCON 2200 21,550,056 13.a.
(1) Noninterest-bearing(1)................................. RCON 6631 8,895,137 13.a.1
(2) Interest-bearing....................................... RCON 6636 12,654,919 13.a.2
b. In foreign offices, Edge and Agreement subsidiaries, and
IBFs (from Schedule RC-E, part II)......................... RCFN 2200 12,364,650 13.b.
(1) Noninterest bearing.................................... RCFN 6631 287,496 13.b.1
(2) Interest-bearing....................................... RCFN 6636 12,077,154 13.b.2
14. Federal funds purchased and securities sold under agreements
to repurchase: RCFD 2800 3.817,421 14
15. a. Demand notes issued to the U.S. Treasury RCON 2840 63,621 15.a.
b. Trading Liabilities(from Schedule RC-D).................... RCFD 3548 5,872,831 15b.
16. Other borrowed money:
a. With original maturity of one year or less................. RCFD 2332 2,607,549 16.a.
b. With original maturity of more than one year.............. RCFD 2333 322,414 16b.
17. Not applicable
18. Bank's liability on acceptance executed and outstanding....... RCFD 2920 488,866 18.
19. Subordinated notes and debentures............................. RCFD 3200 1,550,000 19.
20. Other liabilities (from Schedule RC-G)........................ RCFD 2930 1,196,229 20.
21. Total liabilities (sum of items 13 through 20)................ RCFD 2948 49,833,637 21.
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus................. RCFD 3838 0 23.
24. Common stock.................................................. RCFD 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock)...... RCFD 3839 2,944,244 25.
26. a. Undivided profits and capital reserves....................... RCFD 3632 954,885 26.a.
b. Net unrealized holding gains (losses) on available-for-sale
securities................................................. RCFD 8434 (1,089) 26.b.
27. Cumulative foreign currency translation adjustments........... RCFD 3284 (1,712) 27.
28. Total equity capital (sum of items 23 through 27)............. RCFD 3210 4,097,186 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28)......................... RCFD 3300 53,930,823 29.
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the statement
below that best describes the most comprehensive level of
auditing work performed for the bank by independent external
Number
auditors as of any date during 1996 . . . . . RCFD 6724 .. 2 M.1.
1 = Independent audit of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm which
submits a report on the bank
2 = Independent audit of the bank's parent holding company conducted in
accordance with generally accepted auditing standards by a certified public
accounting firm which submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm (may be
required by state chartering authority)
4 = Directors' examination of the bank performed by other external auditors
(may be required by state chartering authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
(1) Includes total demand deposits and noninterest-bearing time
and savings deposits.
6
<PAGE> 1
Exhibit 99.1
LETTER OF TRANSMITTAL
STAR CAPITAL I
OFFER TO EXCHANGE ITS
FLOATING RATE CAPITAL SECURITIES
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
WHICH HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
FOR ANY AND ALL OF ITS OUTSTANDING
FLOATING RATE CAPITAL SECURITIES
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
PURSUANT TO THE PROSPECTUS
DATED ______ __, 1997
THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE
AT 5:00 P.M., NEW YORK CITY TIME, ON _____ __, 1997, UNLESS
THE OFFER IS EXTENDED.
THE EXCHANGE AGENT FOR THE EXCHANGE OFFER IS
THE FIRST NATIONAL BANK OF CHICAGO
By Registered or Certified Mail or Hand/Overnight Delivery:
The First National Bank of Chicago
c/o First Chicago Trust
14 Wall Street
8th Floor, Window 2
New York, New York 10005
TO CONFIRM BY TELEPHONE OR FOR INFORMATION:
(212) 240-8801
FACSIMILE TRANSMISSIONS:
(ELIGIBLE INSTITUTIONS ONLY)
(212) 240-8938
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET
FORTH ABOVE OR TRANSMISSION OF THIS LETTER OF TRANSMITTAL VIA FACSIMILE TO A
NUMBER OTHER THAN AS SET FORTH ABOVE DOES NOT CONSTITUTE A VALID DELIVERY.
THE INSTRUCTIONS CONTAINED HEREIN SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.
Capitalized terms used but not defined herein shall have the same
meaning given them in the Prospectus (as defined below).
<PAGE> 2
2
This Letter of Transmittal is to be completed by holders of Old Capital
Securities (as defined below) either if Old Capital Securities are to be
forwarded herewith or if tenders of Old Capital Securities are to be made by
book-entry transfer to an account maintained by The First National Bank of
Chicago (the "Exchange Agent") at The Depository Trust Company ("DTC") pursuant
to the procedures set forth in "The Exchange Offer--Procedures for Tendering Old
Capital Securities" in the Prospectus and an Agent's Message (as defined herein)
is not delivered.
Holders of Old Capital Securities whose certificates (the
"Certificates") for such Old Capital Securities are not immediately available or
who cannot deliver their Certificates and all other required documents to the
Exchange Agent on or prior to the Expiration Date (as defined in the Prospectus)
or who cannot complete the procedures for book-entry transfer on a timely basis
must tender their Old Capital Securities according to the guaranteed delivery
procedures set forth in "The Exchange Offer--Procedures for Tendering Old
Capital Securities" in the Prospectus.
DELIVERY OF DOCUMENTS TO DTC DOES NOT CONSTITUTE DELIVERY TO THE
EXCHANGE AGENT.
NOTE: SIGNATURES MUST BE PROVIDED BELOW
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
ALL TENDERING HOLDERS COMPLETE THIS BOX
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------
DESCRIPTION OF OLD CAPITAL SECURITIES TENDERED
- -------------------------------------------------------------------------------------------------------
PLEASE PRINT NAME OLD CAPITAL SECURITIES LIQUIDATION AMOUNT OF
AND ADDRESS OF TENDERED (ATTACH OLD CAPITAL SECURITIES
REGISTERED HOLDER CERTIFICATE ADDITIONAL LIST IF TENDERED (IF LESS THAN
(PLEASE FILL IF BLANK) NUMBER(S)* NECESSARY) ALL)**
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
- -------------------------------------------------------------------------------------------------------
TOTAL AMOUNT TENDERED:
- -------------------------------------------------------------------------------------------------------
</TABLE>
- -----------------
* Need not be completed by book-entry holders.
** All Old Capital Securities held shall be deemed tendered unless a lesser
number is specified in this column.
<PAGE> 3
3
(BOXES BELOW TO BE CHECKED BY ELIGIBLE INSTITUTIONS ONLY)
/ / CHECK HERE IF TENDERED OLD CAPITAL SECURITIES ARE BEING DELIVERED BY
BOOK-ENTRY TRANSFER MADE TO THE ACCOUNT MAINTAINED BY THE EXCHANGE AGENT
WITH DTC AND COMPLETE THE FOLLOWING:
Name of Tendering Institution
----------------------------------------------
DTC Account Number
----------------------------------------------
Transaction Code Number
----------------------------------------------
/ / CHECK HERE AND ENCLOSE A PHOTOCOPY OF THE NOTICE OF GUARANTEED DELIVERY
IF TENDERED OLD CAPITAL SECURITIES ARE BEING DELIVERED PURSUANT TO A NOTICE
OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE EXCHANGE AGENT AND COMPLETE
THE FOLLOWING:
Name of Registered Holder(s)
-----------------------------------------------
Window Ticket Number (if any)
----------------------------------------------
Date of Execution of Notice of Guaranteed Delivery
-------------------------
Name of Institution which Guaranteed Delivery
------------------------------
If Guaranteed Delivery is to be made By Book-Entry Transfer:
Name of Tendering Institution
----------------------------------------------
DTC Account Number
----------------------------------------------
Transaction Code Number
----------------------------------------------
/ / CHECK HERE IF TENDERED BY BOOK-ENTRY TRANSFER AND NON-EXCHANGED OLD
CAPITAL SECURITIES ARE TO BE RETURNED BY CREDITING THE DTC ACCOUNT NUMBER
SET FORTH ABOVE.
/ / CHECK HERE IF YOU ARE A BROKER-DEALER WHO ACQUIRED THE OLD CAPITAL
SECURITIES FOR ITS OWN ACCOUNT AS A RESULT OF MARKET MAKING OR OTHER
TRADING ACTIVITIES (A "PARTICIPATING BROKER-DEALER") AND WISH TO RECEIVE 10
ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR
SUPPLEMENTS THERETO.
Name:
------------------------------------------------------------------------
Address:
------------------------------------------------------------------------
<PAGE> 4
4
Ladies and Gentlemen:
The undersigned hereby tenders to Star Capital I, a Delaware statutory
business trust (the "Trust"), and Star Banc Corporation, an Ohio corporation
(the "Company"), the above described aggregate liquidation amount of the Trust's
Floating Rate Capital Securities due June 15, 2027 (the "Old Capital
Securities") in exchange for a like aggregate liquidation amount of the Trust's
Floating Rate Capital Securities due June 15, 2027 (the "New Capital
Securities") which have been registered under the Securities Act of 1933 (the
"Securities Act"), upon the terms and subject to the conditions set forth in the
Prospectus dated _____ __, 1997 (as the same may be amended or supplemented from
time to time, the "Prospectus"), receipt of which is acknowledged, and in this
Letter of Transmittal (which, together with the Prospectus, constitute the
"Exchange Offer").
Subject to and effective upon the acceptance for exchange of all or any
portion of the Old Capital Securities tendered herewith in accordance with the
terms and conditions of the Exchange Offer (including, if the Exchange Offer is
extended or amended, the terms and conditions of any such extension or
amendment), the undersigned hereby sells, assigns and transfers to or upon the
order of the Trust all right, title and interest in and to such Old Capital
Securities as are being tendered herewith. The undersigned hereby irrevocably
constitutes and appoints the Exchange Agent as its agent and attorney-in-fact
(with full knowledge that the Exchange Agent is also acting as agent of the
Company and the Trust in connection with the Exchange Offer) with respect to the
tendered Old Capital Securities, with full power of substitution (such power of
attorney being deemed to be an irrevocable power coupled with an interest),
subject only to the right of withdrawal described in the Prospectus, to (i)
deliver Certificates for Old Capital Securities to the Company or the Trust
together with all accompanying evidences of transfer and authenticity to, or
upon the order of, the Trust, upon receipt by the Exchange Agent, as the
undersigned's agent, of the New Capital Securities to be issued in exchange for
such Old Capital Securities, (ii) present Certificates for such Old Capital
Securities for transfer, and to transfer the Old Capital Securities on the books
of the Trust, and (iii) receive for the account of the Trust all benefits and
otherwise exercise all rights of beneficial ownership of such Old Capital
Securities, all in accordance with the terms and conditions of the Exchange
Offer.
THE UNDERSIGNED HEREBY REPRESENTS AND WARRANTS THAT THE UNDERSIGNED HAS
FULL POWER AND AUTHORITY TO TENDER, EXCHANGE, SELL, ASSIGN AND TRANSFER THE OLD
CAPITAL SECURITIES TENDERED HEREBY AND THAT, WHEN THE SAME ARE ACCEPTED FOR
EXCHANGE, THE TRUST WILL ACQUIRE GOOD, MARKETABLE AND UNENCUMBERED TITLE
THERETO, FREE AND CLEAR OF ALL LIENS, RESTRICTIONS, CHARGES AND ENCUMBRANCES,
AND THAT THE OLD CAPITAL SECURITIES TENDERED HEREBY ARE NOT SUBJECT TO ANY
ADVERSE CLAIMS OR PROXIES. THE UNDERSIGNED WILL, UPON REQUEST, EXECUTE AND
DELIVER ANY ADDITIONAL DOCUMENTS DEEMED BY THE COMPANY, THE TRUST OR THE
EXCHANGE AGENT TO BE NECESSARY OR DESIRABLE TO COMPLETE THE EXCHANGE, ASSIGNMENT
AND TRANSFER OF THE OLD CAPITAL SECURITIES TENDERED HEREBY, AND THE UNDERSIGNED
WILL COMPLY WITH ITS OBLIGATIONS UNDER THE REGISTRATION RIGHTS AGREEMENT. THE
UNDERSIGNED HAS READ AND AGREES TO ALL OF THE TERMS OF THE EXCHANGE OFFER.
<PAGE> 5
5
The name(s) and address(es) of the registered holder(s) of the Old
Capital Securities tendered hereby should be printed above, if they are not
already set forth above, as they appear on the Certificates representing such
Old Capital Securities. The Certificate number(s) and the Old Capital Securities
that the undersigned wishes to tender should be indicated in the appropriate
boxes above.
If any tendered Old Capital Securities are not exchanged pursuant to the
Exchange Offer for any reason, or if Certificates are submitted for more Old
Capital Securities than are tendered or accepted for exchange, Certificates for
such nonexchanged or nontendered Old Capital Securities will be returned (or, in
the case of Old Capital Securities tendered by book-entry transfer, such Old
Capital Securities will be credited to an account maintained at DTC), without
expense to the tendering holder, promptly following the expiration or
termination of the Exchange Offer.
The undersigned understands that tenders of Old Capital Securities
pursuant to any one of the procedures described in "The Exchange
Offer--Procedures for Tendering Old Capital Securities" in the Prospectus and in
the instruction, will, upon the Company's and the Trust's acceptance for
exchange of such tendered Old Capital Securities, constitute a binding agreement
between the undersigned, the Company and the Trust upon the terms and subject to
the conditions of the Exchange Offer. The undersigned recognizes that, under
certain circumstances set forth in the Prospectus, the Company and the Trust may
not be required to accept for exchange any of the Old Capital Securities
tendered hereby.
Unless otherwise indicated herein in the box entitled "Special Issuance
Instructions" below, the undersigned hereby directs that the New Capital
Securities be issued in the name(s) of the undersigned or, in the case of a
book-entry transfer of Old Capital Securities, that such New Capital Securities
be credited to the account indicated above maintained at DTC. If applicable,
substitute Certificates representing Old Capital Securities not exchanged or not
accepted for exchange will be issued to the undersigned or, in the case of a
book-entry transfer of Old Capital Securities, will be credited to the account
indicated above maintained at DTC. Similarly, unless otherwise indicated under
"Special Delivery Instructions," please deliver New Capital Securities to the
undersigned at the address shown below the undersigned's signature.
BY TENDERING OLD CAPITAL SECURITIES AND EXECUTING THIS LETTER OF
TRANSMITTAL, THE UNDERSIGNED HEREBY REPRESENTS AND AGREES THAT (I) THE
UNDERSIGNED IS NOT AN "AFFILIATE" OF THE COMPANY OR THE TRUST, (II) ANY NEW
CAPITAL SECURITIES TO BE RECEIVED BY THE UNDERSIGNED ARE BEING ACQUIRED IN THE
ORDINARY COURSE OF ITS BUSINESS, (III) THE UNDERSIGNED HAS NO ARRANGEMENT OR
UNDERSTANDING WITH ANY PERSON TO PARTICIPATE IN A DISTRIBUTION (WITHIN THE
MEANING OF THE SECURITIES ACT) OF NEW CAPITAL SECURITIES TO BE RECEIVED IN THE
EXCHANGE OFFER, AND (IV) IF THE UNDERSIGNED IS NOT A BROKER-DEALER, THE
UNDERSIGNED IS NOT ENGAGED IN, AND DOES NOT INTEND TO ENGAGE IN, A DISTRIBUTION
(WITHIN THE MEANING OF THE SECURITIES ACT) OF SUCH NEW CAPITAL SECURITIES. BY
TENDERING OLD CAPITAL SECURITIES PURSUANT TO THE EXCHANGE OFFER AND EXECUTING
THIS LETTER OF TRANSMITTAL, A HOLDER OF OLD CAPITAL SECURITIES WHICH IS A
BROKER-DEALER REPRESENTS AND AGREES, CONSISTENT WITH
<PAGE> 6
6
CERTAIN INTERPRETIVE LETTERS ISSUED BY THE STAFF OF THE DIVISION OF CORPORATION
FINANCE OF THE SECURITIES AND EXCHANGE COMMISSION TO THIRD PARTIES, THAT (A)
SUCH OLD CAPITAL SECURITIES HELD BY THE BROKER-DEALER ARE HELD ONLY AS A
NOMINEE, OR (B) SUCH OLD CAPITAL SECURITIES WERE ACQUIRED BY SUCH BROKER-DEALER
FOR ITS OWN ACCOUNT AS A RESULT OF MARKET-MAKING ACTIVITIES OR OTHER TRADING
ACTIVITIES AND IT WILL DELIVER THE PROSPECTUS (AS AMENDED OR SUPPLEMENTED FROM
TIME TO TIME) MEETING THE REQUIREMENTS OF THE SECURITIES ACT IN CONNECTION WITH
ANY RESALE OF SUCH NEW CAPITAL SECURITIES (PROVIDED THAT, BY SO ACKNOWLEDGING
AND BY DELIVERING A PROSPECTUS, SUCH BROKER-DEALER WILL NOT BE DEEMED TO ADMIT
THAT IT IS AN "UNDERWRITER" WITHIN THE MEANING OF THE SECURITIES ACT).
THE COMPANY AND THE TRUST HAVE AGREED THAT, SUBJECT TO THE PROVISIONS OF
THE REGISTRATION RIGHTS AGREEMENT, THE PROSPECTUS, AS IT MAY BE AMENDED OR
SUPPLEMENTED FROM TIME TO TIME, MAY BE USED BY A PARTICIPATING BROKER-DEALER (AS
DEFINED BELOW) IN CONNECTION WITH RESALES OF NEW CAPITAL SECURITIES RECEIVED IN
EXCHANGE FOR OLD CAPITAL SECURITIES, WHERE SUCH OLD CAPITAL SECURITIES WERE
ACQUIRED BY SUCH PARTICIPATING BROKER-DEALER FOR ITS OWN ACCOUNT AS A RESULT OF
MARKET-MAKING ACTIVITIES OR OTHER TRADING ACTIVITIES, FOR A PERIOD ENDING 180
DAYS AFTER THE REGISTRATION STATEMENT OF WHICH THE PROSPECTUS CONSTITUTES A PART
IS DECLARED EFFECTIVE. IN THAT REGARD, EACH BROKER-DEALER WHO ACQUIRED OLD
CAPITAL SECURITIES FOR ITS OWN ACCOUNT AS A RESULT OF MARKET-MAKING OR OTHER
TRADING ACTIVITIES (A "PARTICIPATING BROKER-DEALER"), BY TENDERING SUCH OLD
CAPITAL SECURITIES AND EXECUTING THIS LETTER OF TRANSMITTAL, AGREES THAT, UPON
RECEIPT OF NOTICE FROM THE COMPANY OR THE TRUST OF THE OCCURRENCE OF ANY EVENT
OR THE DISCOVERY OF ANY FACT WHICH MAKES ANY STATEMENT CONTAINED OR INCORPORATED
BY REFERENCE IN THE PROSPECTUS UNTRUE IN ANY MATERIAL RESPECT OR WHICH CAUSES
THE PROSPECTUS TO OMIT TO STATE A MATERIAL FACT NECESSARY IN ORDER TO MAKE THE
STATEMENTS CONTAINED OR INCORPORATED BY REFERENCE THEREIN, IN LIGHT OF THE
CIRCUMSTANCES UNDER WHICH THEY WERE MADE, NOT MISLEADING OR OF THE OCCURRENCE OF
CERTAIN OTHER EVENTS SPECIFIED IN THE CAPITAL SECURITIES REGISTRATION RIGHTS
AGREEMENT, SUCH PARTICIPATING BROKER-DEALER WILL SUSPEND THE SALE OF NEW CAPITAL
SECURITIES PURSUANT TO THE PROSPECTUS UNTIL THE COMPANY AND THE TRUST HAVE
AMENDED OR SUPPLEMENTED THE PROSPECTUS TO CORRECT SUCH MISSTATEMENT OR OMISSION
AND HAS FURNISHED COPIES OF THE AMENDED OR SUPPLEMENTED PROSPECTUS TO THE
PARTICIPATING BROKER-DEALER OR THE COMPANY OR THE TRUST HAS GIVEN NOTICE THAT
THE SALE OF THE NEW CAPITAL SECURITIES MAY BE RESUMED, AS THE CASE MAY BE.
Each New Capital Security will pay cumulative Distributions from the
most recent Distribution Date or, if no Distributions have been paid on such
Old Capital Securities, from June 8, 1997. Holders of the Old Capital
Securities whose Old Capital Securities are accepted for exchange will not
receive accumulated Distributions on such Old Capital Securities and will be
deemed
<PAGE> 7
7
to have waived the right to receive any Distributions on such Old Capital
Securities accumulated, from and after June 8, 1997.
All authority herein conferred or agreed to be conferred in this Letter
of Transmittal shall survive the death or incapacity of the undersigned and any
obligation of the undersigned hereunder shall be binding upon the heirs,
executors, administrators, personal representatives, trustees in bankruptcy,
legal representatives, successors and assigns of the undersigned. Except as
stated in the Prospectus, this tender is irrevocable.
<PAGE> 8
8
HOLDER(S) SIGN HERE
(SEE INSTRUCTIONS 2, 5 AND 6)
(PLEASE COMPLETE SUBSTITUTE FORM W-9 BELOW)
(NOTE: SIGNATURE(S) MUST BE GUARANTEED IF REQUIRED BY INSTRUCTION 2)
Must be signed by registered holder(s) exactly as name(s) appear(s) on
Certificate(s) for the Old Capital Securities hereby tendered or on a security
position listing, or by any person(s) authorized to become the registered
holder(s) by endorsements and documents transmitted herewith (including such
Opinions of counsel, certifications and other information as may be required by
the Trust or the Trustee for the Old Capital Securities to comply with the
restrictions on transfer applicable to the Old Capital Securities). If signature
is by an attorney-in-fact, executor, administrator, trustee, guardian, officer
of a corporation or another acting in a fiduciary capacity or representative
capacity, please set forth the signer's full title.
See Instruction 5.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(SIGNATURE(S) OF HOLDER(S))
Date: , 1997
-----------------
Name(s)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(PLEASE PRINT)
Capacity (full title)
-----------------------------------------------------------
Address
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(INCLUDE ZIP CODE)
Area Code and Telephone Number
--------------------------------------------------
- --------------------------------------------------------------------------------
(TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER(S))
GUARANTEE OF SIGNATURE(S)
(SEE INSTRUCTIONS 2 AND 5)
<PAGE> 9
9
- --------------------------------------------------------------------------------
(AUTHORIZED SIGNATURE)
Date: , 1997
-------------------
Name of Firm
--------------------------------------------------------------------
Capacity (full title)
-----------------------------------------------------------
(PLEASE PRINT)
Address
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(INCLUDE ZIP CODE)
Area Code and Telephone Number
--------------------------------------------------
<PAGE> 10
10
SPECIAL ISSUANCE INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5 AND 6)
To be completed ONLY if the New Capital Securities or Old Capital Securities
that are not tendered are to be issued in the name of someone other than the
registered holder of the Old Capital Securities whose name(s) appear(s) above.
/ / Issue New Capital Securities to:
/ / Old Capital Securities not tendered to:
Name(s)
-------------------------------------------------------------------------
Address
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(INCLUDE ZIP CODE)
Area Code and Telephone Number
--------------------------------------------------
- --------------------------------------------------------------------------------
(TAX IDENTIFICATION OR SOCIAL
SECURITY NUMBER(S))
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5 AND 6)
To be completed ONLY if New Capital Securities or Old Capital Securities that
are not tendered are to be sent to someone other than the registered holder of
the Old Capital Securities whose name(s) appear(s) above, or such registered
holder(s) at an address other than that shown above.
/ / Mail New Capital Securities to:
/ / Mail Old Capital Securities not tendered to:
Name(s)
-------------------------------------------------------------------------
Address
-------------------------------------------------------------------------
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(INCLUDE ZIP CODE)
Area Code and Telephone Number
--------------------------------------------------
- --------------------------------------------------------------------------------
(TAX IDENTIFICATION OR
SOCIAL SECURITY NUMBER(S))
<PAGE> 11
11
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE
EXCHANGE OFFER
1. DELIVERY OF LETTER OF TRANSMITTAL AND CERTIFICATES; GUARANTEED
DELIVERY PROCEDURES. This Letter of Transmittal is to be completed either if (a)
Certificates are to be forwarded herewith or (b) tenders are to be made pursuant
to the procedures for tender by book-entry transfer set forth in "The Exchange
Offer--Procedures for Tendering Old Capital Securities" in the Prospectus and
an Agent's Message is not delivered. Certificates, or timely confirmation of a
book-entry transfer of such Old Capital Securities into the Exchange Agent's
account at DTC, as well as this Letter of Transmittal (or facsimile thereof),
properly completed and duly executed, with any required signature guarantees,
and any other documents required by this Letter of Transmittal, must be received
by the Exchange Agent at its address set forth herein on or prior to the
Expiration Date. Tenders by book-entry transfer may also be made by delivering
an Agent's Message in lieu of this Letter of Transmittal. The term "Agent's
Message" means a message, transmittal by DTC to and received by the Exchange
Agent and forming a part of a book-entry confirmation, which states that DTC has
received an express acknowledgement from the tendering Participant, which
acknowledgment states that such Participant has received and agrees to be bound
by the Letter of Transmittal and that the Trust and the Corporation may enforce
the Letter of Transmittal against such participant. The term "book-entry
confirmation" means a timely confirmation of book-entry transfer of Old Capital
Securities into the Exchange Agent's account at DTC.
Holders who wish to tender their Old Capital Securities and (i) whose
Old Capital Securities are not immediately available or (ii) who cannot deliver
their Old Capital Securities, this Letter of Transmittal and all other required
documents to the Exchange Agent on or prior to the Expiration Date or (iii) who
cannot complete the procedures for delivery by book-entry transfer on a timely
basis, may tender their Old Capital Securities by properly completing and duly
executing a Notice of Guaranteed Delivery pursuant to the guaranteed delivery
procedures set forth in "The Exchange Offer--Procedures for Tendering Old
Capital Securities" in the Prospectus. Pursuant to such procedures: (i) such
tender must be made by or through an Eligible Institution (as defined below);
(ii) a properly completed and duly executed Notice of Guaranteed Delivery,
substantially in the form made available by the Company, must be received by the
Exchange Agent on or prior to the Expiration Date; and (iii) the Certificates
(or a book-entry confirmation) representing all tendered Old Capital Securities,
in proper form for transfer, together with a Letter of Transmittal (or facsimile
thereof or Agent's Message in lieu thereof), properly completed and duly
executed, with any required signature guarantees and any other documents
required by this Letter of Transmittal, must be received by the Exchange Agent
within three New York Stock Exchange, Inc. trading days after the date of
execution of such Notice of Guaranteed Delivery all as provided in "The Exchange
Offer--Procedures for Tendering Old Capital Securities" in the Prospectus.
<PAGE> 12
12
The Notice of Guaranteed Delivery may be delivered by hand or
transmitted by facsimile or mail to the Exchange Agent, and must include a
guarantee by an Eligible Institution in the form set forth in such Notice. For
Old Capital Securities to be properly tendered pursuant to the guaranteed
delivery procedure, the Exchange Agent must receive a Notice of Guaranteed
Delivery on or prior to the Expiration Date. As used herein and in the
Prospectus, "Eligible Institution" means a firm or other entity identified in
Rule 17Ad-15 under the Exchange Act as "an eligible guarantor institution,"
including (as such terms are defined therein) (i) a bank; (ii) a broker, dealer,
municipal securities broker or dealer or government securities broker or dealer,
(iii) a credit union; (iv) a national securities exchange, registered securities
association or clearing agency; or (v) a savings association that is a
participant in a Securities Transfer Association.
THE METHOD OF DELIVERY OF CERTIFICATES, THIS LETTER OF TRANSMITTAL AND
ALL OTHER REQUIRED DOCUMENTS IS AT THE OPTION AND SOLE RISK OF THE TENDERING
HOLDER AND THE DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE
EXCHANGE AGENT. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT
REQUESTED, PROPERLY INSURED, OR OVERNIGHT DELIVERY SERVICE IS RECOMMENDED. IN
ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.
Neither the Company nor the Trust will accept any alternative,
conditional or contingent tenders. Each tendering holder, by execution of a
Letter of Transmittal (or facsimile thereof or an Agent's Message in lieu
thereof), waives any right to receive any notice of the acceptance of such
tender.
2. GUARANTEE OF SIGNATURES. No signature guarantee on this Letter of
Transmittal is required if:
(i) this Letter of Transmittal is signed by the registered holder
(which term, for purposes of this document' shall include any
participant in DTC whose name appears on a security position
listing as the owner of the Old Capital Securities) of Old
Capital Securities tendered herewith, unless such holder(s) has
completed either the box entitled "Special Issuance Instructions"
or the box entitled "Special Delivery Instructions" above, or
(ii) such Old Capital Securities are tendered for the account of a
firm that is an Eligible Institution.
In all other cases, an Eligible Institution must guarantee the
signature(s) on this Letter of Transmittal. See Instruction 5.
3. INADEQUATE SPACE. If the space provided in the box captioned
"Description of Old Capital Securities" is inadequate, the Certificate number(s)
and/or the principal amount of Old Capital Securities and any other required
information should be listed on a separate signed schedule which is attached to
this Letter of Transmittal.
4. PARTIAL TENDERS AND WITHDRAWAL RIGHTS.
<PAGE> 13
13
If less than all the Old Capital Securities evidenced by any Certificate
submitted are to be tendered, fill in the principal amount of Old Capital
Securities which are to be tendered in the box entitled "Principal Amount of
Old Capital Securities Tendered (if less than all)." In such case, new
Certificate(s) for the remainder of the Old Capital Securities that were
evidenced by your old Certificate(s) will only be sent to the holder of the Old
Capital Security, promptly after the Expiration Date. All Old Capital
Securities represented by Certificates delivered to the Exchange Agent will be
deemed to have been tendered unless otherwise indicated.
Except as otherwise provided herein, tenders of Old Capital Securities
may be withdrawn at any time on or prior to the Expiration Date. In order for a
withdrawal to be effective on or prior to that time, a written, telegraphic,
telex or facsimile transmission of such notice of withdrawal must be timely
received by the Exchange Agent at one of its addresses set forth above or in the
Prospectus on or prior to the Expiration Date. Any such notice of withdrawal
must specify the name of the person who tendered the Old Capital Securities to
be withdrawn, the aggregate principal amount of Old Capital Securities to be
withdrawn, and (if Certificates for Old Capital Securities have been tendered)
the name of the registered holder of the Old Capital Securities as set forth on
the Certificate for the Old Capital Securities, if different from that of the
person who tendered such Old Capital Securities. If Certificates for the Old
Capital Securities have been delivered or otherwise identified to the Exchange
Agent, then prior to the physical release of such Certificates for the Old
Capital Securities, the tendering holder must submit the serial numbers shown on
the particular Certificates for the Old Capital Securities to be withdrawn and
the signature on the notice of withdrawal must be guaranteed by an Eligible
Institution, except in the case of Old Capital Securities tendered for the
account of an Eligible Institution. If Old Capital Securities have been tendered
pursuant to the procedures for book-entry transfer set forth in "The Exchange
Offer--Procedures for Tendering Old Capital Securities," the notice of
withdrawal must specify the name and number of the account at DTC to be credited
with the withdrawal of Old Capital Securities, in which case a notice of
withdrawal will be effective if delivered to the Exchange Agent by written,
telegraphic, telex or facsimile transmission. Withdrawals of tenders of Old
Capital Securities may not be rescinded. Old Capital Securities properly
withdrawn will not be deemed validly tendered for purposes of the Exchange
Offer, but may be retendered at any subsequent time on or prior to the
Expiration Date by following any of the procedures described in the Prospectus
under "The Exchange Offer--Procedures for Tendering Old Capital Securities."
All questions as to the validity, form and eligibility (including time
of receipt) of such withdrawal notices will be determined by the Company and the
Trust, in their sole discretion, whose determination shall be final and binding
on all parties. The Company and the Trust, any affiliates or assigns of the
Company and the Trust, the Exchange Agent or any other person shall not be under
any duty to give any notification of any irregularities in any notice of
withdrawal or incur any liability for failure to give any such notification. Any
Old Capital Securities which have been tendered but which are withdrawn will be
returned to the holder thereof without cost to such holder promptly after
withdrawal.
5. SIGNATURES ON LETTER OF TRANSMITTAL, ASSIGNMENTS AND ENDORSEMENTS. If
this Letter of Transmittal is signed by the registered holder(s) of the
<PAGE> 14
14
Old Capital Securities tendered hereby, the signature(s) must correspond exactly
with the name(s) as written on the face of the Certificate(s) without
alteration, enlargement or any change whatsoever.
If any of the Old Capital Securities tendered hereby are owned of record
by two or more joint owners, all such owners must sign this Letter of
Transmittal.
If any tendered Old Capital Securities are registered in different
name(s) on several Certificates, it will be necessary to complete, sign and
submit as many separate Letters of Transmittal (or facsimiles thereof or an
Agent's Message in lieu thereof) as there are different registrations of
Certificates.
If this Letter of Transmittal or any Certificates or bond powers are
signed by trustees, executors, administrators, guardians, attorneys-in-fact,
officers of corporations or others acting in a fiduciary or representative
capacity, such persons should so indicate when signing and must submit proper
evidence satisfactory to the Company and the Trust, in their sole discretion, of
such persons' authority to so act.
When this Letter of Transmittal is signed by the registered owner(s) of
the Old Capital Securities listed and transmitted hereby, no endorsement(s) of
Certificate(s) or separate bond power(s) are required unless New Capital
Securities are to be issued in the name of a person other than the registered
holder(s). Signature(s) on such Certificate(s) or bond power(s) must be
guaranteed by an Eligible Institution.
If this Letter of Transmittal is signed by a person other than the
registered owner(s) of the Old Capital Securities listed, the Certificates must
be endorsed or accompanied by appropriate bond powers, signed exactly as the
name or names of the registered owner(s) appear(s) on the Certificates, and also
must be accompanied by such opinions of counsel, certifications and other
information as the Company, the Trust or the Trustee for the Old Capital
Securities may require in accordance with the restrictions on transfer
applicable to the Old Capital Securities. Signatures on such Certificates or
bond powers must be guaranteed by an Eligible Institution.
6. SPECIAL ISSUANCE AND DELIVERY INSTRUCTIONS. If New Capital Securities
are to be issued in the name of a person other than the signer of this Letter of
Transmittal, or if New Capital Securities are to be sent to someone other than
the signer of this Letter of Transmittal or to an address other than that shown
above, the appropriate boxes on this Letter of Transmittal should be completed.
Certificates for Old Capital Securities not exchanged will be returned by mail
or, if tendered by book-entry transfer, by crediting the account indicated above
maintained at DTC. See Instruction 4.
7. IRREGULARITIES. The Company and the Trust will determine, in their
sole discretion, all questions as to the form of documents, validity,
eligibility (including time of receipt) and acceptance for exchange of any
tender of Old Capital Securities, which determination shall be final and binding
on all parties. The Company and the Trust reserve the absolute right to reject
any and all tenders determined by either of them not to be in proper form or the
acceptance of which, or exchange for, may, in the view of counsel to the Company
and the Trust, be unlawful. The Company and the Trust also reserve the absolute
right, subject to applicable law, to waive any of the conditions of the Exchange
Offer set
<PAGE> 15
15
forth in the Prospectus under "The Exchange Offer--Certain Conditions to the
Exchange Offer" or any conditions or irregularity in any tender of Old Capital
Securities of any particular holder whether or not similar conditions or
irregularities are waived in the case of other holders. The Company's and the
Trust's interpretation of the terms and conditions of the Exchange Offer
(including this Letter of Transmittal and the instructions hereto) will be final
and binding. No tender of Old Capital Securities will be deemed to have been
validly made until all irregularities with respect to such tender have been
cured or waived. The Company, the Trust, any affiliates or assigns of the
Company, the Trust, the Exchange Agent, or any other person shall not be under
any duty to give notification of any irregularities in tenders or incur any
liability for failure to give such notification.
8. QUESTIONS, REQUESTS FOR ASSISTANCE AND ADDITIONAL COPIES. Questions
and requests for assistance may be directed to the Exchange Agent at its address
and telephone number set forth on the front of this Letter of Transmittal.
Additional copies of the Prospectus, the Notice of Guaranteed Delivery and the
Letter of Transmittal may be obtained from the Exchange Agent or from your
broker, dealer, commercial bank, trust company or other nominee.
9. 31% BACKUP WITHHOLDING; SUBSTITUTE FORM W-9. Under U.S. Federal
income tax law, a holder whose tendered Old Capital Securities are accepted for
exchange is required to provide the Exchange Agent with such holder's correct
taxpayer identification number ("TIN") on Substitute Form W-9 below. If the
Exchange Agent is not provided with the correct TIN, the Internal Revenue
Service (the "IRS") may subject the holder or other payee to a $50 penalty. In
addition, payments to such holders or other payees with respect to Old Capital
Securities exchanged pursuant to the Exchange Offer may be subject to 31% backup
withholding.
The box in Part 2 of the Substitute Form W-9 may be checked if the
tendering holder has not been issued a TIN and has applied for a TIN or intends
to apply for a TIN in the near future. If the box in Part 2 is checked, the
holder or other payee must also complete the Certificate of Awaiting Taxpayer
Identification Number below in order to avoid backup withholding.
Notwithstanding that the box in Part 2 is checked and the Certificate of
Awaiting Taxpayer Identification Number is completed, the Exchange Agent will
withhold 31% of all payments made prior to the time a properly certified TIN is
provided to the Exchange Agent. The Exchange Agent will retain such amounts
withheld during the 60 day period following the date of the Substitute Form W-9.
If the holder furnishes the Exchange Agent with its TIN within 60 days after the
date of the Substitute Form W-9, the amounts retained during the 60 day period
will be remitted to the holder and no further amounts shall be retained or
withheld from payments made to the holder thereafter. If, however, the holder
has not provided the Exchange Agent with its TIN within such 60 days period,
amounts withheld will be remitted to the IRS as backup withholding. In addition,
31% of all payments made thereafter will be withheld and remitted to the IRS
until a correct TIN is provided.
The holder is required to give the Exchange Agent the TIN (e.g., social
security number or employer identification number) of the registered owner of
the Old Capital Securities or of the last transferee appearing on the transfers
attached to, or endorsed on, the Old Capital Securities. If the Old Capital
Securities are registered in more than one name or are not in the name of the
actual owner, consult the enclosed "Guidelines for Certification of
<PAGE> 16
16
Taxpayer Identification Number on Substitute Form W-9" for additional guidance
on which number to report.
Certain holders (including, among others, corporations, financial
institutions and certain foreign persons) may not be subject to these backup
withholding and reporting requirements. Such holders should nevertheless
complete the attached Substitute Form W-9 below, and write "exempt" on the face
thereof, to avoid possible erroneous backup withholding. A foreign person may
qualify as an exempt recipient by submitting a properly completed IRS Form W-8,
signed under penalties of perjury, attesting to that holder's exempt status.
Please consult the enclosed "Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9" for additional guidance on which
holders are exempt from backup withholding.
Backup withholding is not an additional U.S. Federal Income Tax. Rather,
the U.S. Federal income tax liability of a person subject to backup withholding
will be reduced by the amount of tax withheld. If withholding results in an
overpayment of taxes, a refund may be obtained.
10. LOST, DESTROYED OR STOLEN CERTIFICATES. If any Certificate(s)
representing Old Capital Securities have been lost, destroyed or stolen, the
holder should promptly notify the Exchange Agent. The holder will then be
instructed as to the steps that must be taken in order to replace the
Certificate(s). This Letter of Transmittal and related documents cannot be
processed until the procedures for replacing lost, destroyed or stolen
Certificate(s) have been followed.
11. SECURITY TRANSFER TAXES. Holders who tender their Old Capital
Securities for exchange will not be obligated to pay any transfer taxes in
connection therewith. If, however, New Capital Securities are to be delivered
to, or are to be issued in the name of, any person other than the registered
holder of the Old Capital Securities tendered, or if a transfer tax is imposed
for any reason other than the exchange of Old Capital Securities in connection
with the Exchange Offer, then the amount of any such transfer tax (whether
imposed on the registered holder or any other persons) will be payable by the
tendering holder. If satisfactory evidence of payment of such taxes or exemption
therefrom is not submitted with the Letter of Transmittal, the amount of such
transfer taxes will be billed directly to such tendering holder.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR FACSIMILE THEREOF) AND ALL
OTHER REQUIRED DOCUMENTS MUST BE RECEIVED BY THE EXCHANGE AGENT ON OR PRIOR TO
THE EXPIRATION DATE.
<PAGE> 17
17
TO BE COMPLETED BY ALL TENDERING HOLDERS
PAYOR'S NAME:________________
<TABLE>
<S> <C>
PART 1 -- PLEASE PROVIDE YOUR TIN IN THE TIN:______________________________
BOX AT RIGHT AND CERTIFY BY SIGNING AND Social Security Number or
DATING BELOW. Employer Identification Number
Part 2 - TIN Applied For
CERTIFICATION: UNDER THE PENALTIES OF PERJURY, I CERTIFY
THAT:
SUBSTITUTE
(1) the number shown on this form is my correct Taxpayer Identification Number (or I am
waiting for a number to be issued to me.).
FORM W-9
(2) I am not subject to backup withholding either because: (a) I am exempt from backup
Department of the Treasury withholding, or (b) I have not been notified by the Internal Revenue Service (the "IRS")
Internal Revenue Service that I am subject to backup withholding as a result of a failure to report all interest or
dividends, or (c) the IRS has notified me that I am no longer subject to backup
Payor's Request for Taxpayer withholding, and
Identification Number ("TIN")
and Certification (3) any other information provided on this form is true and correct.
SIGNATURE ................................ DATE ......................
You must cross out item (2) of the above certification if you have been notified by IRS that you are subject to backup
withholding because of underreporting of interest or dividends on your tax return and you have not been notified by the
IRS that you are no longer subject to backup withholding.
</TABLE>
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN
PART 2 OF SUBSTITUTE FORM W-9
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification number has
not been issued to me, and either (a) I have mailed or delivered an application
to receive a taxpayer identification number to the appropriate Internal Revenue
Service Center or Social Security Administration Office or (b) I intend to mail
or deliver an application in the near future. I understand that if I do not
provide a taxpayer identification number by the time of the exchange, 31 percent
of all reportable payments made to me thereafter will be withheld until I
provide the number.
___________________________________________ _________________________________
Signature Date
<PAGE> 1
Exhibit 99.2
NOTICE OF GUARANTEED DELIVERY
FOR TENDER OF
FLOATING RATE CAPITAL SECURITIES
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
OF
STAR CAPITAL I
FULLY AND UNCONDITIONALLY GUARANTEED
BY STAR BANC CORPORATION
This Notice of Guaranteed Delivery, or one substantially equivalent
to this form, must be used to accept the Exchange Offer (as defined below) if
(i) certificates for the Floating Rate Capital Securities due June 15, 2027 (the
"Old Capital Securities") of Star Capital I, a Delaware statutory business trust
(the "Trust") are not immediately available, (ii) Old Capital Securities, the
Letter of Transmittal and all other required documents cannot be delivered to
The First National Bank of Chicago (the "Exchange Agent") on or prior to the
Expiration Date (as defined in the Prospectus referred to below) or (iii) the
procedures for delivery by book-entry transfer cannot be completed on a timely
basis. This Notice of Guaranteed Delivery may be delivered by hand, overnight
courier or mail, or transmitted by facsimile transmission, to the Exchange
Agent. See "The Exchange Offer--Procedures for Tendering Old Capital Securities"
in the Prospectus.
THE EXCHANGE AGENT FOR THE EXCHANGE OFFER IS:
THE FIRST NATIONAL BANK OF CHICAGO
By Registered or Certified Mail or Hand/Overnight Delivery:
The First National Bank of Chicago
c/o First Chicago Trust
14 Wall Street
8th Floor, Window 2
New York, New York 10005
TO CONFIRM BY TELEPHONE OR FOR INFORMATION:
(212) 240-8801
FACSIMILE TRANSMISSIONS:
(Eligible Institutions Only)
(212) 240-8938
DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS
OTHER THAN AS SET FORTH ABOVE OR TRANSMISSION OF THIS NOTICE OF
GUARANTEED DELIVERY VIA FACSIMILE TO A NUMBER OTHER THAN AS SET
FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.
<PAGE> 2
THIS NOTICE OF GUARANTEED DELIVERY IS NOT TO BE USED TO
GUARANTEE SIGNATURES. IF A SIGNATURE ON A LETTER OF TRANSMITTAL IS
REQUIRED TO BE GUARANTEED BY AN "ELIGIBLE INSTITUTION" UNDER THE
INSTRUCTIONS THERETO, SUCH SIGNATURE GUARANTEE MUST APPEAR IN THE
APPLICABLE SPACE PROVIDED IN THE SIGNATURE BOX ON THE LETTER OF
TRANSMITTAL.
-2-
<PAGE> 3
Ladies and Gentlemen:
The undersigned hereby tenders to Star Capital I, a Delaware statutory business
trust (the "Trust'), upon the terms and subject to the conditions set forth in
the Prospectus dated _____ __, 1997 (as the same may be amended or supplemented
from time to time, the "Prospectus"), and the related Letter of Transmittal
(which together constitute the "Exchange Offer"), receipt of which is hereby
acknowledged, the aggregate principal amount of Old Capital Securities set forth
below pursuant to the guaranteed delivery procedures set forth in the Prospectus
under the caption "The Exchange Offer--Procedures for Tendering Old Capital
Securities."
Aggregate PrincipalName(s) of Registered Holder(s):
Amount Tendered:
Certificate No(s).Address(es):
(if available):Area Code and Telephone Number(s):
If Old Capital Securities will be tendered by book-entry transfer, provide the
following information:
Signature(s):________________________________________________
DTC Account Number:__________________________________________
Date:________________________________________________________
THE GUARANTEE ON THE REVERSE SIDE MUST BE COMPLETED
-3-
<PAGE> 4
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a firm or other entity identified in Rule 17Ad-15 under the
Securities Exchange Act of 1934, as amended, as an "eligible guarantor
institution," including (as such terms are defined therein): (i) a bank; (ii) a
broker, dealer, municipal securities broker, municipal securities dealer,
government securities broker, government securities dealer; (iii) a credit
union; (iv) a national securities exchange, registered securities association or
clearing agency; or (v) a savings association that is a participant in a
Securities Transfer Association recognized program (each of the foregoing being
referred to as an "Eligible Institution"), hereby guarantees to deliver to the
Exchange Agent, at one of its addresses set forth above, either the Old Capital
Securities tendered hereby in proper form for transfer, or confirmation of the
book-entry transfer of such Old Capital Securities to the Exchange Agent's
account at The Depository Trust Company ("DTC"), pursuant to the procedures for
one or more properly completed and duly executed Letter(s) of Transmittal (or
facsimile thereto) and any other required documents within five business days
after the date of execution of this Notice of Guaranteed Delivery.
The undersigned acknowledges that it must deliver the Letter(s) of Transmittal
and the Old Capital Securities tendered hereby to the Exchange Agent within the
time period set forth above and that failure to do so could result in a
financial loss to the undersigned.
Name of Firm___________________________________________________
(Authorized Signature)__________________________________________
(Title)
Address________________________________________________________
________________________________________________________
(INCLUDE ZIP CODE)
Area Code and Telephone Number_________________________________
Date:____________________
NOTE:DO NOT SENT OLD CAPITAL SECURITIES WITH THIS NOTICE OF
GUARANTEED DELIVERY. ACTUAL SURRENDER OF OLD CAPITAL SECURITIES
MUST BE MADE PURSUANT TO, AND BE ACCOMPANIED BY, A PROPERLY
COMPLETED AND DULY EXECUTED LETTER OF TRANSMITTAL AND THE
REQUIRED DOCUMENTS.
-4-
<PAGE> 1
Exhibit 99.3
, 1997
FORM OF EXCHANGE AGENT AGREEMENT
The First National Bank of Chicago
Corporate Trust Trustee Administration
One First National Plaza
Chicago, Illinois 60670
Ladies and Gentlemen:
Star Capital I, a Delaware statutory business trust (the "Trust"), and
Star Banc Corporation, an Ohio corporation, as Sponsor (the "Company"), propose
to make an offer (the "Exchange Offer") to exchange an aggregate liquidation
amount of the Trust's Floating Rate Capital Securities due June 15, 2027 (the
"Old Capital Securities") for a like aggregate liquidation amount of the
Trust's Floating Rate Capital Securities due June 15, 2027 (the "New Capital
Securities"). The terms and conditions of the Exchange Offer as currently
contemplated are set forth in a prospectus, dated , 1997 (as the same
may be amended or supplemented from time to time, the "Prospectus"), proposed
to be distributed to all record holders of the Old Capital Securities. The Old
Capital Securities and the New Capital Securities are collectively referred to
herein as the "Capital Securities".
Each of the Company and the Trust hereby appoints The First National
Bank of Chicago to act as exchange agent (the "Exchange Agent") in connection
with the Exchange Offer. References hereinafter to "you" shall refer to The
First National Bank of Chicago.
The Exchange Offer is expected to be commenced by the Company and the
Trust on or about , 1997. The Letter of Transmittal accompanying the
Prospectus (or in the case of book-entry securities the ATOP system) is to be
used by the holders of the Old Capital Securities to accept the Exchange Offer
and contains instructions with respect to the delivery of (i) certificates for
Old Capital Securities tendered in connection therewith and (ii) the book-entry
transfer of Capital Securities to the Exchange Agent's account.
The Exchange Offer shall expire at 5:00 P.M., New York City time, on
, 1997 unless the Exchange Offer is extended by the Company (the
"Expiration Date"). Any delay in acceptance, extension, termination, or
amendment of the Exchange Offer, will be followed promptly by oral or written
notice thereof to the Exchange Agent and by making a public announcement
thereof, and such announcement in the case of an extension will be made no
later than 9:00 a.m., New York City time, on the next business day after the
previously scheduled Expiration Date.
The Company expressly reserves the right to amend or terminate the
Exchange Offer, and the right not to accept for exchange any Old Capital
Securities not theretofore accepted for exchange, upon the occurrence of any of
the conditions of the Exchange Offer
<PAGE> 2
2
specified in the Prospectus under the caption "The Exchange Offer - Conditions
to the Exchange Offer."
In carrying out your duties as Exchange Agent, you are to act in
accordance with the following instructions:
1. You will perform such duties and only such duties as are
specifically set forth in the section of the Prospectus captioned "The Exchange
Offer" or as specifically set forth herein; provided, however, that in no way
will your general duty to act in good faith be discharged by the foregoing.
2. You will establish an account with respect to the Old Capital
Securities at The Depository Trust Company (the "Book-Entry Transfer Facility")
for purposes of the Exchange Offer within two business days after the date of
the Prospectus, and any financial institution that is a participant in the
Book-Entry Transfer Facility's systems may make book-entry delivery of the Old
Capital Securities by causing the Book-Entry Transfer Facility to transfer such
Old Capital Securities into your account in accordance with the Book-Entry
Transfer Facility's procedure for such transfer.
3. You are to examine each of the Letters of Transmittal and
certificates for Old Capital Securities (or confirmation of book-entry transfer
into your account at the Book-Entry Transfer Facility) and any other documents
delivered or mailed to you by or for holders of the Old Capital Securities to
ascertain whether: (i) the Letters of Transmittal and any such other documents
are duly executed and properly completed in accordance with instructions set
forth therein and (ii) the Old Capital Securities have otherwise been properly
tendered. In each case where the Letter of Transmittal or any other document
has been improperly completed or executed or any of the certificates for Old
Capital Securities are not in proper form for transfer or some other
irregularity in connection with the acceptance of the Exchange Offer exists,
you will endeavor to inform the presenters of the need for fulfillment of all
requirements and to take any other action as may be necessary or advisable to
cause such irregularity to be corrected.
4. With the prior approval of any Trustee of the Trust (such approval,
if given orally, to be confirmed in writing) or any other party designated by
such Trustee in writing, you are authorized to waive any irregularities in
connection with any tender of Old Capital Securities pursuant to the Exchange
Offer.
5. Tenders of Old Capital Securities may be made only as set forth in
the Letter of Transmittal and in the section of the Prospectus captioned "The
Exchange Offer - Procedures for Tendering Old Capital Securities'', and Old
Capital Securities shall be considered properly tendered to you only when
tendered in accordance with the procedures set forth therein.
Notwithstanding the provisions of this paragraph 5, Old Capital
Securities which any Trustee of the Trust shall approve as having been properly
tendered shall be
<PAGE> 3
3
considered to be properly tendered (such approval, if given orally, shall be
confirmed in writing).
6. You shall advise the Trust with respect to any Old Capital Securities
received subsequent to the Expiration Date and accept the Trust's instructions
with respect to disposition of such Old Capital Securities,
7. You shall accept tenders:
(a) in cases where the Old Capital Securities are registered in two or
more names, only if signed by all named holders;
(b) in cases where the signing person (as indicated on the Letter of
Transmittal) is acting in a fiduciary or a representative capacity, only
when proper evidence of his or her authority so to act is submitted; and
(c) from persons other than the registered holder of Old Capital
Securities provided that customary transfer requirements, including any
applicable transfer taxes, are fulfilled.
You shall accept partial tenders of Old Capital Securities where so
indicated and as permitted in the Letter of Transmittal and deliver certificates
for Old Capital Securities to the transfer agent for split-up and return any
untendered Old Capital Securities to the holder (or such other person as may be
designated in the Letter of Transmittal) as promptly as practicable after
expiration or termination of the Exchange Offer.
8. Upon satisfaction or waiver of all of the conditions to the Exchange
Offer, the Trust will notify you (such notice if given orally, to be confirmed
in writing) of its acceptance, promptly after the Expiration Date, of all Old
Capital Securities properly tendered, and you, on behalf of the Trust, will
exchange such Old Capital Securities for New Capital Securities and cause such
Old Capital Securities to be cancelled. Delivery of New Capital Securities will
be made on behalf of the Trust by you at the rate of $1,000 principal amount of
New Capital Securities for each $1,000 principal amount of Old Capital
Securities tendered promptly after notice (such notice if given orally, to be
confirmed in writing) of acceptance of said Old Capital Securities by the Trust;
provided, however, that in all cases, Old Capital Securities tendered pursuant
to the Exchange Offer will be exchanged only after timely receipt by you of
certificates for such Old Capital Securities (or confirmation of book-entry
transfer into your account at the Book-Entry Transfer Facility), a properly
completed and duly executed Letter of Transmittal (or facsimile thereof) with
any required signature guarantees and any other required documents. You shall
issue New Capital Securities only in denominations of $1,000 or any integral
multiple thereof.
9. Tenders pursuant to the Exchange Offer are irrevocable, except that,
subject to the terms and upon the conditions set forth in the Prospectus and the
Letter of Transmittal, Old Capital Securities tendered pursuant to the Exchange
Offer may be withdrawn at any time prior to the Expiration Date.
<PAGE> 4
4
10. The Trust shall not be required to exchange any Old Capital
Securities tendered if any of the conditions set forth in the Exchange Offer
are not met.
11. If, pursuant to the Exchange Offer, the Trust does not accept for
exchange all or part of the Old Capital Securities tendered because of an
invalid tender, the occurrence of certain other events set forth in the
Prospectus under the caption "The Exchange Offer - Conditions to the Exchange
Offer" or otherwise, you shall as soon as practicable after the expiration or
termination of the Exchange Offer return those certificates for unaccepted Old
Capital Securities (or effect appropriate book-entry transfer), together with
any related required documents and the Letters of Transmittal relating thereto
that are in your possession, to the persons who deposited them.
12. All certificates for reissued Old Capital Securities, unaccepted
Old Capital Securities or for New Capital Securities shall be forwarded by (a)
first-class certified mail, return receipt requested under a blanket surety
bond protecting you and the Trust from loss or liability arising out of the
non-receipt or non-delivery of such certificates or (b) by registered mail
insured separately for the replacement value of each of such certificates.
13. You are not authorized to pay or offer to pay any concessions,
commissions or solicitation fees to any broker, dealer, bank or other persons
or to engage or utilize any person to solicit tenders.
14. As Exchange Agent hereunder you:
(a) shall have no duties or obligations other than those specifically
set forth herein or as may be subsequently agreed to in writing by you and
the Trust;
(b) will be regarded as making no representations and having no
responsibilities as to the validity, sufficiency, value or genuineness of
any of the certificates or the Old Capital Securities represented thereby
deposited with you pursuant to the Exchange Offer, and will not be required
to and will make no representation as to the validity, value or genuineness
of the Exchange Offer;
(c) shall not be obligated to take any legal action hereunder which
might in your reasonable judgment involve any expense or liability, unless
you have been furnished with reasonable indemnity;
(d) may reasonably rely on and shall be protected in acting in reliance
upon any certificate, instrument, opinion, notice, letter, telegram or other
document or security delivered to you and reasonably believed by you in good
faith to be genuine and to have been signed by the proper party or parties;
(e) may reasonably act upon any tender, statement, request, comment,
agreement or other instrument whatsoever not only as to its due execution
and validity and effectiveness of its provisions, but also as to the truth
and accuracy of any
<PAGE> 5
5
information contained therein, which you shall in good faith believe to be
genuine or to have been signed or represented by a proper person or persons;
(f) may rely on and shall be protected in acting upon written or oral
instructions from any officer of the Trust;
(g) may consult with your counsel with respect to any questions relating to
your duties and responsibilities and the advice or opinion of such counsel shall
be full and complete authorization and protection in respect of any action
taken, suffered or omitted to be taken by you hereunder in good faith and in
accordance with the advice or opinion of such counsel; and
(h) shall not advise any person tendering Old Capital Securities pursuant
to the Exchange Offer as to the wisdom of making such tender or as to the market
value or decline or appreciation in market value of any Old Capital Securities.
15. You shall take such action as may from time to time be requested by the
Trust or its counsel (and such other action as you may reasonably deem
appropriate) to furnish copies of the Prospectus, Letter of Transmittal and the
Notice of Guaranteed Delivery (as defined in the Prospectus) or such other forms
as may be approved from time to time by the Trust, to all persons requesting
such documents and to accept and comply with telephone requests for information
relating to the Exchange Offer, provided that such information shall relate only
to the procedures for accepting (or withdrawing from) the Exchange Offer. The
Trust will furnish you with copies of such documents at your request. All other
requests for information relating to the Exchange Offer shall be directed to the
Company's Treasury Division, 425 Walnut Street, Cincinnati, Ohio 45203,
telephone number (513) 632-4000.
16. You shall advise by facsimile transmission or telephone, and promptly
thereafter confirm in writing to the Trust and such person or persons as it may
request, daily (and more frequently during the week immediately preceding the
Expiration Date and if otherwise requested) up to and including the Expiration
Date, as to the number of Old Capital Securities which have been tendered
pursuant to the Exchange Offer and the items received by you pursuant to this
Agreement, separately reporting and giving cumulative totals as to items
properly received and items improperly received. In addition, you will also
inform, and cooperate in making available to, the Trust or any such other
person or persons upon oral request made from time to time prior to the
Expiration Date of such other information as it or he or she reasonably
requests. Such cooperation shall include, without limitation, the granting by
you to the Trust and such person as the Trust may request of access to those
persons on your staff who are responsible for receiving tenders, in order to
ensure that immediately prior to the Expiration Date the Trust shall have
received information in sufficient detail to enable it to decide whether to
extend the Exchange Offer. You shall prepare a final list of all persons whose
tenders were accepted, the aggregate principal amount of Old Capital Securities
tendered, the aggregate principal amount of Old Capital Securities accepted and
deliver said list to the Trust.
<PAGE> 6
6
17. Letters of Transmittal and Notices of Guaranteed Delivery shall be
stamped by you as to the date and the time of receipt thereof and shall be
preserved by you for a period of time at least equal to the period of time you
preserve other records pertaining to the transfer of securities. You shall
dispose of unused Letters of Transmittal and other surplus materials by
returning them to the Trust.
18. You hereby expressly waive any lien, encumbrance or right of set-off
whatsoever that you may have with respect to funds deposited with you for the
payment of transfer taxes by reasons of amounts, if any, borrowed by the Trust,
the Company or any of its subsidiaries or affiliates pursuant to any loan or
credit agreement with you or for compensation owed to you hereunder.
19. For services rendered as Exchange Agent hereunder, you shall be
entitled to such compensation as set forth on Schedule I attached hereto.
20. You hereby acknowledge receipt of the Prospectus and the Letter of
Transmittal and further acknowledge that you have examined each of them. Any
inconsistency between this Agreement, on the one hand, and the Prospectus and
the Letter of Transmittal (as they may be amended from time to time), on the
other hand, shall be resolved in favor of the latter two documents, except with
respect to the duties, liabilities and indemnification of you as Exchange Agent,
which shall be controlled by this Agreement.
21. The Company covenants and agrees to indemnify and hold you harmless in
your capacity as Exchange Agent hereunder against any loss, liability, cost or
expense, including reasonable attorneys' fees and expenses, arising out of or in
connection with any act, omission, delay or refusal made by you in reliance
upon any signature, endorsement, assignment, certificate, order, request,
notice, instruction or other instrument or document reasonably believed by you
in good faith to be valid, genuine and sufficient and in accepting any tender or
effecting any transfer of Old Capital Securities reasonably believed by you in
good faith to be authorized, and in delaying or refusing in good faith to accept
any tenders or effect any transfer of Old Capital Securities; provided, however,
that the Company shall not be liable for indemnification or otherwise for any
loss, liability, cost or expense to the extent arising out of your gross
negligence or willful misconduct. In no case shall the Company be liable under
this indemnity with respect to any claim against you unless the Company shall be
notified by you, by letter or by facsimile confirmed by letter, of the written
assertion of a claim against you or of any other action commenced against you,
promptly after you shall have received any such written assertion or notice of
commencement of action. The Company shall be entitled to participate at its own
expense in the defense of any such claim or other action, and, if the Company so
elects, the Company shall assume the defense of any suit brought to enforce any
such claim. In the event that the Company shall assume the defense of any such
suit, the Company shall not be liable for the fees and expenses of any
additional counsel thereafter retained by you so long as the Company shall
retain counsel satisfactory to you to defend such suit.
<PAGE> 7
7
22. You shall arrange to comply with all requirements under the tax laws of
the United States, including those relating to missing Tax Identification
Numbers, and shall file any appropriate reports with the Internal Revenue
Service.
23. You shall deliver or cause to be delivered, in a timely manner, to each
governmental authority to which any transfer taxes are payable in respect of the
exchange of Old Capital Securities, your check in the amount of all transfer
taxes so payable, and the Company shall reimburse you for the amount of any and
all transfer taxes payable in respect of the exchange of Old Capital Securities;
provided, however, that you shall reimburse the Company for amounts refunded to
you in respect of your payment of any such transfer taxes, at such time as such
refund is received by you.
24. This Agreement and your appointment as Exchange Agent hereunder shall
be construed and enforced in accordance with the laws of the State of New York
applicable to agreements made and to be performed entirely within such state,
and without regard to conflicts of law principles, and shall inure to the
benefit of, and the obligations created hereby shall be binding upon, the
successors and assigns of each of the parties hereto.
25. This Agreement may be executed in two or more counterparts, each of
which shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.
26. In case any provision of this Agreement shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
27. This Agreement shall not be deemed or construed to be modified,
amended, rescinded, cancelled or waived, in whole or in part, except by a
written instrument signed by a duly authorized representative of the party to be
charged. This Agreement may not be modified orally.
28. Unless otherwise provided herein, all notices, requests and other
communications to any party hereunder shall be in writing (including facsimile
or similar writing) and shall be given to such party, addressed to it, at its
address or telecopy number set forth in the Prospectus, in the case of the
Company and the Trust, and set forth below in the case of the Exchange Agent:
If to the Exchange Agent:
The First National Bank of Chicago
One First National Plaza
Chicago, Illinois 60670
Facsimile: (312) 407-1708
Attn: Donna Fanning
<PAGE> 8
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29. Unless terminated earlier by the parties hereto, this Agreement
shall terminate 90 days following the Expiration Date. Notwithstanding the
foregoing, Paragraphs 17, 19, 21 and 23 shall survive the termination of this
Agreement. Upon any termination of this Agreement, you shall promptly deliver
to the Company any certificates for Capital Securities, funds or property then
held by you as Exchange Agent under this Agreement.
30. This Agreement shall be binding and effective as of the date
hereof.
Please acknowledge receipt of this Agreement and confirm the
arrangements herein provided by signing and returning the enclosed copy.
STAR CAPITAL I
By:
---------------------------
Name:
Title: Regular Trustee
STAR BANC CORPORATION
By:
---------------------------
Name:
Title:
Accepted as the date
first above written:
THE FIRST NATIONAL BANK OF CHICAGO,
as Exchange Agent
By:
--------------------------------
Name:
Title:
<PAGE> 9
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SCHEDULE I
FEES
