<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 22, 1997
REGISTRATION NO. 333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
FIRST UNION CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
<TABLE>
<S> <C>
NORTH CAROLINA 56-0898180
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
</TABLE>
ONE FIRST UNION CENTER
CHARLOTTE, NORTH CAROLINA 28288-0013
(704) 374-6565
(Address, Including Zip Code, and Telephone Number,
Including Area Code, of Registrant's Principal Executive Offices)
MARION A. COWELL, JR., ESQ.
EXECUTIVE VICE PRESIDENT, SECRETARY AND GENERAL COUNSEL
FIRST UNION CORPORATION
ONE FIRST UNION CENTER
CHARLOTTE, NORTH CAROLINA 28288-0013
(704) 374-6828
(Name, Address, Including Zip Code, and Telephone Number,
Including Area Code, of Agent For Service)
WITH A COPY TO:
ROBERT B. HIDEN, JR., ESQ.
SULLIVAN & CROMWELL
125 BROAD STREET
NEW YORK, NEW YORK 10004
(212) 558-4000
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: FROM TIME TO
TIME AFTER THE EFFECTIVE DATE OF THIS REGISTRATION STATEMENT, AS DETERMINED IN
LIGHT OF MARKET AND OTHER CONDITIONS.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, as amended (the "Securities Act"), other than securities offered only in
connection with dividend or interest reinvestment plans, check the following
box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
[CAPTION]
<TABLE>
<S> <C> <C> <C>
TITLE OF EACH CLASS PROPOSED MAXIMUM PROPOSED MAXIMUM
OF SECURITIES TO AMOUNT TO BE AGGREGATE PRICE AGGREGATE OFFER-
BE REGISTERED REGISTERED PER UNIT ING PRICE
<S> <C> <C> <C>
Common Stock (par value $3.33 1/3 per
share)................................ (1)(2) (1) (1)(2)
Preferred Stock (no-par value).......... (1) (1) (1)
Class A Preferred Stock (no-par value)... (1) (1) (1)
Depositary Shares....................... (1)(3) (1) (1)(3)
Debt Securities......................... (1) (1) (1)
Warrants................................ (1) (1) (1)
Total............................... $2,000,000,000 (1) $2,000,000,000
<CAPTION>
TITLE OF EACH CLASS AMOUNT OF
OF SECURITIES TO REGISTRATION
BE REGISTERED FEE
<S> <C>
Common Stock (par value $3.33 1/3 per
share)................................ N/A
Preferred Stock (no-par value).......... N/A
Class A Preferred Stock (no-par value)... N/A
Depositary Shares....................... N/A
Debt Securities......................... N/A
Warrants................................ N/A
Total............................... $606,061(4)
</TABLE>
(1) There are being registered hereunder such indeterminate number of shares of
Common Stock, Preferred Stock and Class A Preferred Stock, such
indeterminate number of Depositary Shares and Warrants to purchase Debt
Securities, Preferred Stock, Class A Preferred Stock, Depositary Shares or
Common Stock, and such indeterminate principal amount of Debt Securities of
the Registrant as shall have an aggregate initial offering price not to
exceed $2,000,000,000. If any Debt Securities are issued at an original
issue discount, then the securities registered shall include such additional
Debt Securities as may be necessary such that the aggregate initial public
offering price of all securities issued pursuant to this Registration
Statement will equal $2,000,000,000. Any securities registered hereunder may
be sold separately or as units with other securities registered hereunder.
The proposed maximum initial offering price per unit will be determined,
from time to time, by the Registrant in connection with the issuance by the
Registrant of the securities registered hereunder. There are also being
registered hereunder an indeterminate number of shares of Common Stock,
Preferred Stock and Class A Preferred Stock, an indeterminate number of
Depositary Shares and an indeterminate principal amount of Debt Securities
of the Registrant as shall be issuable upon conversion or exchange of
convertible or exchangeable Debt Securities or of shares of convertible or
exchangeable Preferred Stock or Class A Preferred Stock registered hereby,
or as shall be issuable pursuant to anti-dilution provisions.
(2) Each share of Common Stock includes a right to purchase shares of a junior
participating series of Class A Preferred Stock of the Registrant (the
"Rights"). Prior to the occurrence of certain events, none of which have
occurred as of the date hereof, the Rights will not be exercisable or
evidenced separately from the Common Stock.
(3) Subject to footnote (1), there are being registered hereunder an
indeterminate number of Depositary Shares to be evidenced by Depositary
Receipts issued pursuant to a Deposit Agreement. If the Registrant elects to
offer to the public fractional interests in shares of the Preferred Stock or
Class A Preferred Stock registered hereunder, Depositary Receipts will be
distributed to those persons purchasing such fractional interests, and the
shares of Preferred Stock or Class A Preferred Stock, as the case may be,
will be issued to the Depositary under the Deposit Agreement.
(4) Calculated pursuant to Rule 457(o) of the rules and regulations under the
Securities Act.
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 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON
SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY
DETERMINE.
Pursuant to Rule 429 under the Securities Act, this Registration Statement
contains a combined prospectus that also relates to Registration Statement No.
33-61941 on Form S-3 previously filed by the Registrant and declared effective
on September 7, 1995.
<PAGE>
(A redherring appears on the left hand side of this page, rotated 90 degrees.
Text follows.)
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
FIRST UNION CORPORATION
COMMON STOCK, PREFERRED STOCK, CLASS A PREFERRED STOCK,
DEPOSITARY SHARES, DEBT SECURITIES AND WARRANTS
First Union Corporation (the "Corporation") may offer from time to time (i)
common stock, $3.33 1/3 par value per share ("Common Stock"), (ii) one or more
series of Preferred Stock, no-par value per share ("Preferred Stock"), which may
be evidenced by Depositary Shares (as defined herein), (iii) one or more series
of Class A Preferred Stock, no-par value per share ("Class A Preferred Stock"),
which may be evidenced by Depositary Shares, (iv) one or more series of debt
securities ("Debt Securities"), consisting of debentures, notes and/or other
unsecured evidences of indebtedness, which may be unsubordinated ("Senior Debt
Securities") or subordinated ("Subordinated Debt Securities") to certain other
obligations of the Corporation, and (v) warrants to purchase Debt Securities,
Preferred Stock, Class A Preferred Stock, Depositary Shares or Common Stock
("Warrants", and together with the Common Stock, Preferred Stock, Class A
Preferred Stock, Depositary Shares and Debt Securities, "Securities"), at an
aggregate initial offering price not to exceed $2,000,000,000, plus up to
$390,000,000 in aggregate initial offering price of additional Debt Securities
(or at the option of the Corporation if so specified in the applicable
supplement or supplements to this Prospectus (each, a "Prospectus Supplement"),
the equivalent thereof in any other currency or currency unit), at prices and on
terms to be determined at the time of sale. Securities may be offered separately
or together, in separate series, in amounts, at prices and on terms to be set
forth in the applicable Prospectus Supplement.
The applicable Prospectus Supplement will set forth with regard to the
particular Securities in respect of which such Prospectus Supplement is being
delivered, the terms of the offering thereof, including (i) in the case of Debt
Securities, whether they are Senior Debt Securities or Subordinated Debt
Securities and the specific designation, aggregate principal amount, the
currency or currency unit in which payments are to be made, denominations,
maturity, premium, if any, rate (which may be fixed or variable) and time of
payment of interest, if any, terms for redemption at the option of the
Corporation or the holder, if any, terms for sinking fund payments, if any, and,
in the case of Subordinated Debt Securities, subordination terms and conversion
or exchange rights, if any; (ii) in the case of Preferred Stock or Class A
Preferred Stock, the specific serial designation, the number of shares, any
dividend, redemption, liquidation, conversion, exchange, sinking fund, voting
and other rights, if any, and whether interests in such Preferred Stock or Class
A Preferred Stock will be evidenced by Depositary Shares and, if so, the
identity of the Depositary (as defined herein); (iii) in the case of Common
Stock, the number of shares; and (iv) in the case of Warrants, the duration,
offering price, exercise price and detachability of such Warrants, as well as a
description of the Debt Securities, Preferred Stock, Class A Preferred Stock,
Depositary Shares or Common Stock issuable upon such exercise. Unless otherwise
specified in the applicable Prospectus Supplement, Securities other than Common
Stock will be issued in permanent global form and Common Stock will be issued in
definitive form.
The Common Stock is listed and traded on the New York Stock Exchange (the
"NYSE") under the symbol "FTU". The applicable Prospectus Supplement will also
contain information, where applicable, as to any other listing on a securities
exchange of Securities covered by such Prospectus Supplement.
The Corporation may sell Securities to or through underwriters, including
First Union Capital Markets Corp., an affiliate of the Corporation, acting as
principals for their own account or as agents, and also may sell Securities
directly to other purchasers or through agents designated from time to time. The
applicable Prospectus Supplement will set forth the initial public offering
price, the names of any underwriters or agents, the principal amounts, if any,
to be purchased by underwriters, the compensation of such underwriters and
agents, if any, and the net proceeds to the Corporation. If the Corporation,
directly or through agents, solicits offers to purchase Securities, the
Corporation reserves the sole right to accept and, together with its agents, to
reject in whole or in part any proposed purchase of Securities. See "Plan of
Distribution". Any underwriters, dealers or agents participating in the offering
may be deemed "underwriters" within the meaning of the Securities Act of 1933,
as amended (together with the rules and regulations thereunder, the "Securities
Act"). See "Plan of Distribution" for possible indemnification arrangements for
underwriters, agents and their controlling persons.
This Prospectus and the applicable Prospectus Supplements may be used by
First Union Capital Markets Corp. in connection with offers and sales related to
market-making transactions in Securities covered by such Prospectus Supplements.
First Union Capital Markets Corp. may act as principal or agent in such
transactions. Such sales will be made at prices related to prevailing market
prices at the time of sale.
NONE OF THE SECURITIES WILL BE SAVINGS ACCOUNTS, DEPOSITS OR OTHER
OBLIGATIONS OF ANY BANK OR NONBANK SUBSIDIARY OF THE CORPORATION, AND NONE OF
THE SECURITIES WILL BE INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION
("FDIC"), THE BANK INSURANCE FUND ("BIF"), THE SAVINGS ASSOCIATION INSURANCE
FUND ("SAIF") OR ANY OTHER GOVERNMENTAL AGENCY.
This Prospectus may not be used to consummate the sale of any Securities
unless accompanied by a Prospectus Supplement covering such Securities.
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>
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND THE APPLICABLE
PROSPECTUS SUPPLEMENTS, AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED. NEITHER THIS
PROSPECTUS NOR ANY PROSPECTUS SUPPLEMENT CONSTITUTES AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE SECURITIES TO
WHICH THEY RELATE OR ANY 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 OR ANY PROSPECTUS SUPPLEMENT
NOR ANY SALE THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION
THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE CORPORATION SINCE THE DATE
HEREOF OR THEREOF OR THAT THE INFORMATION CONTAINED HEREIN OR THEREIN IS CORRECT
AS OF ANY TIME SUBSEQUENT TO ITS DATE.
THE COMMISSIONER OF INSURANCE OF THE STATE OF NORTH CAROLINA HAS NOT
APPROVED OR DISAPPROVED THE OFFERING OF ANY SECURITIES NOR HAS SUCH COMMISSIONER
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS OR ANY PROSPECTUS
SUPPLEMENT.
AVAILABLE INFORMATION
The Corporation is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (together with the rules and
regulations thereunder, the "Exchange Act"), and in accordance therewith, files
reports, proxy statements and other information with the Securities and Exchange
Commission (the "Commission"). Reports, proxy statements and other information
filed by the Corporation can be inspected and copied at the public reference
facilities maintained by the Commission at 450 Fifth Street, N.W., Washington,
D.C. 20549 and at the Commission's Regional Offices in New York (7 World Trade
Center, 13th Floor, New York, New York 10048) and Chicago (Citicorp Center, 500
West Madison Street, Suite 1400, Chicago, Illinois 60661) and copies of such
materials can be obtained from the Public Reference Section of the Commission at
450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. Certain of
such reports, proxy statements and other information is also available from the
Commission over the Internet at http://www.sec.gov. The Common Stock is listed
and traded on the NYSE. Reports, proxy statements and other information relating
to the Corporation can also be inspected at the offices of the NYSE, 20 Broad
Street, New York, New York 10005.
This Prospectus does not contain all of the information set forth in the
Registration Statement on Form S-3, of which this Prospectus is a part, and the
exhibits thereto (together with any amendments or supplements thereto, the
"Registration Statement"), which has been filed by the Corporation with the
Commission under the Securities Act, certain portions of which have been omitted
pursuant to the rules and regulations of the Commission and to which portions
reference is hereby made for further information.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Corporation with the Commission (File
No. 1-10000) under Section 13(a) or 15(d) of the Exchange Act are hereby
incorporated by reference in this Prospectus:
(i) the Corporation's Annual Report on Form 10-K for the year ended
December 31, 1996;
(ii) the Corporation's Quarterly Reports on Form 10-Q for the periods ended
March 31, 1997, and June 30, 1997; and
(iii) the Corporation's Current Reports on Form 8-K dated January 13, 1997,
July 21, 1997 and August 20, 1997.
All documents filed by the Corporation pursuant to Section 13(a), 13(c), 14
or 15(d) of the Exchange Act subsequent to the date hereof and prior to the
termination of the offering of any Securities are hereby incorporated by
reference into this Prospectus and shall be deemed a part hereof from the date
of filing of such documents.
Any statement contained herein, in any supplement hereto or in a document
incorporated or deemed to be incorporated by reference herein or therein shall
be deemed to be modified or superseded for purposes of the Registration
Statement, this Prospectus and any Prospectus Supplement to the extent that a
statement contained herein, in any supplement hereto or in any subsequently
filed document which also is or is deemed to be incorporated by reference herein
or therein 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, this Prospectus or any
supplement hereto.
THIS PROSPECTUS INCORPORATES CERTAIN DOCUMENTS BY REFERENCE WHICH ARE NOT
PRESENTED HEREIN OR DELIVERED HEREWITH. A COPY OF SUCH DOCUMENTS IS AVAILABLE
WITHOUT CHARGE (OTHER THAN CERTAIN EXHIBITS TO SUCH DOCUMENTS) TO EACH PERSON TO
WHOM THIS PROSPECTUS IS DELIVERED, UPON WRITTEN OR ORAL REQUEST TO: FIRST UNION
CORPORATION, INVESTOR RELATIONS, ONE FIRST UNION CENTER, CHARLOTTE, NORTH
CAROLINA 28288-0206 (TELEPHONE NUMBER: (704) 374-6782).
2
<PAGE>
THE CORPORATION
GENERAL
Financial and other information relating to the Corporation, including
information relating to the Corporation's directors and executive officers, is
set forth in the Corporation's 1996 Annual Report on Form 10-K, 1997 Annual
Meeting Proxy Statement, 1997 Quarterly Reports on Form 10-Q, 1997 Current
Reports on Form 8-K, and such other documents filed by the Corporation under the
Exchange Act subsequent to the date hereof as specified under "Incorporation of
Certain Documents by Reference", copies of which may be obtained from the
Corporation as indicated under "Available Information".
HISTORY AND BUSINESS
The Corporation was incorporated under the laws of North Carolina in 1967
and is registered as a bank holding company under the Bank Holding Company Act
of 1956, as amended (the "BHCA"). Pursuant to a corporate reorganization in
1968, First Union National Bank, based in Charlotte, North Carolina ("FUNB-NC"),
and First Union Mortgage Corporation, a mortgage banking firm acquired by
FUNB-NC in 1964, became subsidiaries of the Corporation.
In addition to North Carolina, the Corporation's full-service banking
subsidiaries also operate in Connecticut, Delaware, Florida, Georgia, Maryland,
New Jersey, New York, Pennsylvania, South Carolina, Tennessee, Virginia and
Washington, D.C. In addition to providing a wide range of commercial and retail
banking and trust services through its full-service banking subsidiaries, the
Corporation also provides various other financial services, including mortgage
banking, home equity lending, leasing, investment banking, insurance and
securities brokerage services through other subsidiaries.
Since the 1985 Supreme Court decision upholding regional interstate banking
legislation, the Corporation has concentrated its efforts on building a large,
regional banking organization in what it perceives to be some of the better
banking markets in the eastern region of the United States. Since November 1985,
the Corporation has completed 72 banking-related acquisitions and has pending
three acquisitions, including the more significant acquisitions (I.E.,
acquisitions involving the acquisition of $3.0 billion or more in assets or
deposits) set forth in the following table.
<TABLE>
<CAPTION>
CONSIDERATION/
ASSETS/ ACCOUNTING
NAME HEADQUARTERS DEPOSITS (1)(2) TREATMENT COMPLETION DATE
<S> <C> <C> <C> <C>
Atlantic Bancorporation..................... Florida $ 3.8 billion common stock/pooling November 1985
Northwestern Financial Corporation.......... North Carolina 3.0 billion common stock/pooling December 1985
First Railroad & Banking Company of
Georgia................................... Georgia 3.7 billion common stock/pooling November 1986
Florida National Banks of Florida, Inc...... Florida 7.9 billion cash and preferred
stock/purchase January 1990
Southeast Banking Corporation subsidiary
banks ("Southeast")....................... Florida 9.9 billion cash, notes and preferred
stock/purchase September 1991
Resolution Trust Corporation ("RTC")
acquisitions.............................. Florida,
Georgia,
Virginia 5.3 billion cash/purchase 1991-1994
Dominion Bankshares Corporation............. Virginia 8.9 billion common and preferred
stock/pooling March 1993
Georgia Federal Bank, FSB................... Georgia 4.0 billion cash/purchase June 1993
First American Metro Corp................... Virginia 4.6 billion cash/purchase June 1993
American Savings of Florida, F.S.B.......... Florida 3.6 billion common stock/purchase July 1995
First Fidelity Bancorporation............... New Jersey 35.3 billion common and preferred
stock/pooling January 1996
Center Financial Corporation................ Connecticut 4.0 billion common stock/purchase November 1996
Signet Banking Corporation ("Signet")....... Virginia $ 11.9 billion common stock/pooling pending
</TABLE>
(1) The dollar amounts indicated represent the assets of the related
organization as of the last reporting period prior to acquisition, except
for (i) the dollar amount relating to RTC acquisitions, which represents
savings and loan deposits acquired from the RTC, and (ii) the dollar amount
relating to Southeast, which represents assets of the two banking
subsidiaries of Southeast Banking Corporation acquired from the FDIC.
(2) In addition, the Corporation acquired (i) Lieber & Company, a mutual fund
advisory company with approximately $3.4 billion in assets under management,
in June 1994, and (ii) Keystone Investments, Inc., a mutual fund advisory
company
3
<PAGE>
with approximately $11.6 billion in assets under management, in December
1996. The consideration paid by the Corporation in each acquisition was
Common Stock. The Lieber & Company acquisition was accounted for as a
pooling of interests, and the Keystone Investments, Inc. acquisition was
accounted for as a purchase.
The Corporation is continually evaluating acquisition opportunities and
frequently conducts due diligence activities in connection with possible
acquisitions. As a result, acquisition discussions and, in some cases,
negotiations frequently take place and future acquisitions involving cash, debt
or equity securities can be expected. Acquisitions typically involve the payment
of a premium over book and market values, and therefore, some dilution of the
Corporation's book value and net income per common share may occur in connection
with future transactions.
RECENT DEVELOPMENTS
On July 21, 1997, the Corporation entered into an agreement to acquire
Signet. As of and for the six months ended June 30, 1997, Signet had total
assets of $11.9 billion, net loans of $6.3 billion, deposits of $8.1 billion,
stockholders' equity of $936 million and net income of $31 million, and as of
such date, Signet operated in Virginia, Washington, D.C., and Maryland.
The acquisition agreement provides for the issuance of 1.10 shares of
Common Stock for each share of Signet common stock. As of June 30, 1997, Signet
had approximately 60.4 million shares of common stock outstanding. The
transaction, which is subject to stockholder and regulatory approvals and other
conditions of closing, will be accounted for as a pooling of interests.
Additional information with respect to the proposed acquisition of Signet
is set forth in the Corporation's Current Report Form 8-K dated July 21, 1997.
See "Incorporation of Certain Documents by Reference."
CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES
The Corporation's Consolidated Ratios of Earnings to Fixed Charges and
Consolidated Ratios of Earnings to Fixed Charges and Preferred Stock Dividends
for the periods indicated were as follows:
<TABLE>
<CAPTION>
SIX MONTHS
ENDED JUNE 30, YEAR ENDED DECEMBER 31,
1997 1996 1995 1994 1993 1992
<S> <C> <C> <C> <C> <C> <C>
CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES
Excluding interest on deposits.......................... 2.61x 2.32 2.75 3.55 3.95 2.71
Including interest on deposits.......................... 1.61x 1.49 1.54 1.73 1.70 1.32
CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES AND
PREFERRED STOCK DIVIDENDS
Excluding interest on deposits.......................... 2.61x 2.31 2.67 3.10 3.59 2.43
Including interest on deposits.......................... 1.61x 1.49 1.53 1.67 1.67 1.30
</TABLE>
For purposes of computing these ratios, earnings represent income from
continuing operations before extraordinary items and cumulative effect of a
change in accounting principle plus income taxes and fixed charges (excluding
capitalized interest). Fixed charges, excluding interest on deposits, represent
interest (other than on deposits, but including capitalized interest), one-third
(the proportion deemed representative of the interest factor) of rents and all
amortization of debt issuance costs. Fixed charges, including interest on
deposits, represent all interest (including capitalized interest), one-third
(the proportion deemed representative of the interest factor) of rents and all
amortization of debt issuance costs. For purposes of calculating the
Consolidated Ratios of Earnings to Fixed Charges and Preferred Stock Dividends,
fixed charges are combined with preferred stock dividends paid, adjusted to a
pretax basis.
4
<PAGE>
USE OF PROCEEDS
The Corporation currently intends to use the net proceeds from the sale of
any Securities for general corporate purposes, which may include the reduction
of indebtedness, investments at the holding company level, investments in, or
extensions of credit to, its banking and other subsidiaries and other banks and
companies engaged in other financial service activities, possible acquisitions,
stock repurchases and such other purposes as may be stated in any applicable
Prospectus Supplement. Pending such use, the net proceeds may be temporarily
invested. The precise amounts and timing of the application of proceeds will
depend upon the funding requirements of the Corporation and its subsidiaries and
the availability of other funds. Except as may be described in any applicable
Prospectus Supplement, specific allocations of the proceeds to such purposes
will not have been made at the date of such Prospectus Supplement.
Based upon the historical and anticipated future growth of the Corporation
and the financial needs of the Corporation and its subsidiaries, the Corporation
may engage in additional financings of a character and amount to be determined
as the need arises.
CERTAIN REGULATORY CONSIDERATIONS
AS A BANK HOLDING COMPANY, THE CORPORATION IS SUBJECT TO REGULATION UNDER
THE BHCA AND TO ITS EXAMINATION AND REPORTING REQUIREMENTS. THE FOLLOWING
DISCUSSION SETS FORTH CERTAIN OF THE MATERIAL ELEMENTS OF THE REGULATORY
FRAMEWORK APPLICABLE TO BANK HOLDING COMPANIES AND THEIR SUBSIDIARIES AND
PROVIDES CERTAIN SPECIFIC INFORMATION RELEVANT TO THE CORPORATION. THIS
REGULATORY FRAMEWORK IS INTENDED PRIMARILY FOR THE PROTECTION OF DEPOSITORS AND
THE FEDERAL DEPOSIT INSURANCE FUNDS AND NOT FOR THE PROTECTION OF SECURITY
HOLDERS. TO THE EXTENT THAT THE FOLLOWING INFORMATION DESCRIBES STATUTORY AND
REGULATORY PROVISIONS, IT IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE
PARTICULAR STATUTORY AND REGULATORY PROVISIONS. A CHANGE IN APPLICABLE STATUTES,
REGULATIONS OR REGULATORY POLICY MAY HAVE A MATERIAL EFFECT ON THE BUSINESS OF
THE CORPORATION.
GENERAL
As a bank holding company, the Corporation is subject to regulation under
the BHCA and to its examination and reporting requirements. Under the BHCA, bank
holding companies may not directly or indirectly acquire the ownership or
control of more than five percent of the voting shares or substantially all of
the assets of any company, including a bank, without the prior approval of, or a
waiver of the requirement for such approval by, the Board of Governors of the
Federal Reserve System (the "Federal Reserve Board"). In addition, bank holding
companies are generally prohibited under the BHCA from engaging in nonbanking
activities, subject to certain exceptions.
The earnings of the Corporation are affected by the legislative and
governmental actions of various regulatory authorities, including the Federal
Reserve Board, the Comptroller of the Currency (the "OCC") and the FDIC. In
addition, there are numerous governmental requirements and regulations which
affect the activities of the Corporation.
PAYMENT OF DIVIDENDS
The Corporation is a legal entity separate and distinct from its banking
and other subsidiaries. A major portion of the Corporation's revenues result
from amounts paid as dividends to the Corporation by its national bank
subsidiaries. The prior approval of the OCC is required for the payment of any
dividend by a national bank if the total of all dividends declared by the board
of directors of such bank in any calendar year will exceed the sum of such
bank's net profits for that year and its retained net profits for the preceding
two calendar years, less any required transfers to surplus. Federal law also
prohibits any national bank from paying dividends which would be greater than
such bank's undivided profits after deducting statutory bad debt in excess of
such bank's allowance for loan losses.
In addition to its national bank subsidiaries, the Corporation has one
state-chartered bank subsidiary which is subject to dividend limitations under
applicable state laws.
Under the foregoing dividend restrictions and certain restrictions
applicable to certain of the Corporation's nonbanking subsidiaries, as of June
30, 1997, the Corporation's subsidiaries, without obtaining affirmative
governmental approvals, could pay aggregate dividends of $717 million to the
Corporation. In the first six months of 1997, the Corporation's subsidiaries
paid $603 million in cash dividends to the Corporation. In addition, a corporate
reorganization of the Corporation's subsidiary banks in Georgia and Florida into
FUNB-NC on June 5, 1997, resulted in a reduction of capital in the amount of
$400 million, which was paid to the Corporation.
In addition, the Corporation and its bank subsidiaries are subject to
various general regulatory policies and requirements relating to the payment of
dividends, including requirements to maintain adequate capital above regulatory
minimums. The
5
<PAGE>
appropriate federal regulatory authority is authorized to determine, under
certain circumstances relating to the financial condition of a national bank or
bank holding company, that the payment of dividends would be an unsafe or
unsound practice and to prohibit payment thereof. The OCC (the appropriate
agency with respect to the Corporation's national bank subsidiaries) and the
FDIC (the appropriate agency with respect to the Corporation's state-chartered
bank subsidiary) have indicated that paying dividends that deplete a bank's
capital base to an inadequate level would be an unsound and unsafe banking
practice. The OCC, the FDIC and the Federal Reserve Board have each indicated
that banking organizations should generally pay dividends only out of current
operating earnings.
BORROWINGS; ETC.
There are also various legal restrictions on the extent to which each of
the Corporation and certain of its nonbank subsidiaries can borrow or otherwise
obtain credit from its bank subsidiaries. In general, these restrictions require
that any such extensions of credit must be secured by designated amounts of
specified collateral and are limited, as to any one of the Corporation or such
nonbank subsidiaries, to ten percent of the lending bank's capital stock and
surplus, and as to the Corporation and all such nonbank subsidiaries in the
aggregate, to 20 percent of such lending bank's capital stock and surplus.
The Federal Deposit Insurance Act, as amended (the "FDIA") imposes
liability on an institution the deposits of which are insured by the FDIC, such
as the Corporation's subsidiary banks, for certain potential losses of the FDIC
incurred in connection with other FDIC-insured institutions under common control
with such institution.
Under the National Bank Act, if the capital stock of a national bank is
impaired by losses or otherwise, the OCC is authorized to require payment of the
deficiency by assessment upon the bank's stockholders, pro rata and, to the
extent necessary, if any such assessment is not paid by any stockholder after
three months notice, to sell the stock of such stockholder to make good the
deficiency.
Under Federal Reserve Board policy, the Corporation is expected to act as a
source of financial strength to each of its subsidiary banks and to commit
resources to support each of such subsidiaries. This support may be required at
times when, absent such Federal Reserve Board policy, the Corporation may not
find itself willing or able to provide it.
Any capital loans by a bank holding company to any of its subsidiary banks
are subordinate in right of payment to deposits and to certain other
indebtedness of such subsidiary banks. In the event of a bank holding company's
bankruptcy, any commitment by the bank holding company to a federal bank
regulatory agency to maintain the capital of a subsidiary bank will be assumed
by the bankruptcy trustee and entitled to a priority of payment.
CAPITAL ADEQUACY
The Federal Reserve Board, the FDIC and the OCC have adopted substantially
similar risk-based and leverage capital guidelines for United States banking
organizations. Under these risked-based capital standards, the minimum
consolidated ratio of total capital to risk-weighted assets (including certain
off-balance sheet activities, such as standby letters of credit) is eight
percent. At least half of the total capital is to be composed of common
stockholder's equity, retained earnings, a limited amount of qualifying
perpetual preferred stock and minority interests in the equity accounts of
consolidated subsidiaries, less goodwill and certain intangibles ("tier 1
capital" and, together with tier 2 capital, "total capital"). The remainder of
total capital may consist of mandatory convertible debt securities and a limited
amount of subordinated debt, qualifying preferred stock and loan loss allowance
("tier 2 capital"). At June 30, 1997, the Corporation's tier 1 and total capital
ratios were 7.55 percent and 12.64 percent, respectively.
In addition, the Federal Reserve Board has established minimum leverage
ratio guidelines for bank holding companies. These guidelines provide for a
minimum leverage ratio of tier 1 capital to adjusted average quarterly assets
less certain amounts ("leverage ratio") equal to three percent for bank holding
companies that meet certain specified criteria, including having the highest
regulatory rating. All other bank holding companies will generally be required
to maintain a leverage ratio of from at least four to five percent. The
Corporation's leverage ratio at June 30, 1997, was 6.23 percent. The guidelines
also provide that bank holding companies experiencing internal growth or making
acquisitions will be expected to maintain strong capital positions substantially
above the minimum supervisory levels without significant reliance on intangible
assets. Furthermore, the guidelines indicate that the Federal Reserve Board will
continue to consider a "tangible tier 1 leverage ratio" (deducting all
intangibles) in evaluating proposals for expansion or new activity. The Federal
Reserve Board has not advised the Corporation of any specific minimum leverage
ratio or tangible tier 1 leverage ratio applicable to it.
Each of the Corporation's subsidiary banks is subject to similar capital
requirements adopted by the OCC or the FDIC. Each of the Corporation's
subsidiary banks had a leverage ratio in excess of 5.47 percent as of June 30,
1997. The federal banking agencies have not advised any of the subsidiary banks
of any specific minimum leverage ratio applicable to it.
6
<PAGE>
PROMPT CORRECTIVE ACTION
The FDIA, among other things, requires the federal banking agencies to take
"prompt corrective action" in respect of depository institutions that do not
meet minimum capital requirements. The FDIA establishes five capital tiers:
"well capitalized"; "adequately capitalized"; "undercapitalized"; "significantly
undercapitalized"; and "critically undercapitalized". A depository institution's
capital tier will depend upon how its capital levels compare to various relevant
capital measures and certain other factors, as established by regulation.
The federal bank regulatory agencies have adopted regulations establishing
relevant capital measures and relevant capital levels applicable to FDIC-insured
banks. The relevant capital measures are the total capital ratio, tier 1 capital
ratio and the leverage ratio. Under the regulations, a FDIC-insured bank will be
(i) "well capitalized" if it has a total capital ratio of ten percent or
greater, a tier 1 capital ratio of six percent or greater and a leverage ratio
of five percent or greater and is not subject to any order or written directive
by the OCC to meet and maintain a specific capital level for any capital
measure; (ii) "adequately capitalized" if it has a total capital ratio of eight
percent or greater, a tier 1 capital ratio of four percent or greater and a
leverage ratio of four percent or greater (three percent in certain
circumstances) and is not "well capitalized"; (iii) "undercapitalized" if it has
a total capital ratio of less than eight percent, a tier 1 capital ratio of less
than four percent or a leverage ratio of less than four percent (three percent
in certain circumstances); (iv) "significantly undercapitalized" if it has a
total capital ratio of less than six percent, a tier 1 capital ratio of less
than three percent or a leverage ratio of less than three percent; and (v)
"critically undercapitalized" if its tangible equity is equal to or less than
two percent of average quarterly tangible assets. An institution may be
downgraded to, or deemed to be in, a capital category that is lower than is
indicated by its capital ratios if it is determined to be in an unsafe or
unsound condition or if it receives an unsatisfactory examination rating with
respect to certain matters. As of June 30, 1997, all of the Corporation's
deposit-taking subsidiary banks had capital levels that qualify them as being
"well capitalized" under such regulations.
The FDIA generally prohibits a FDIC-insured depository institution from
making any capital distribution (including payment of a dividend) or paying any
management fee to its holding company if the depository institution would
thereafter be "undercapitalized". "Undercapitalized" depository institutions are
subject to growth limitations and are required to submit a capital restoration
plan. The federal banking agencies may not accept a capital plan without
determining, among other things, that the plan is based on realistic assumptions
and is likely to succeed in restoring the depository institution's capital. In
addition, for a capital restoration plan to be acceptable, the depository
institution's parent holding company must guarantee that the institution will
comply with such capital restoration plan. The aggregate liability of the parent
holding company is limited to the lesser of: (i) an amount equal to five percent
of the depository institution's total assets at the time it became
"undercapitalized"; and (ii) the amount which is necessary (or would have been
necessary) to bring the institution into compliance with all capital standards
applicable with respect to such institution as of the time it fails to comply
with the plan. If a depository institution fails to submit an acceptable plan,
it is treated as if it is "significantly undercapitalized".
"Significantly undercapitalized" insured depository institutions may be
subject to a number of requirements and restrictions, including orders to sell
sufficient voting stock to become "adequately capitalized", requirements to
reduce total assets, and cessation of receipt of deposits from correspondent
banks. "Critically undercapitalized" institutions are subject to the appointment
of a receiver or conservator. A bank that is not "well capitalized" is subject
to certain limitations relating to so-called "brokered" deposits.
DEPOSITOR PREFERENCE STATUTE
Under federal law, deposits and certain claims for administrative expenses
and employee compensation against an insured depository institution would be
afforded a priority over other general unsecured claims against such an
institution, including federal funds and letters of credit, in the "liquidation
or other resolution" of such an institution by any receiver.
INTERSTATE BANKING AND BRANCHING LEGISLATION
The Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994
(the "IBBEA") authorized interstate acquisitions of banks and bank holding
companies without geographic limitation beginning one year after enactment. In
addition, it authorized, beginning June 1, 1997, a bank to merge with a bank in
another state as long as neither of the states has opted out of interstate
branching between the date of enactment of the IBBEA and May 31, 1997. In
addition, a bank may establish and operate a DE NOVO branch in a state in which
the bank does not maintain a branch if that state expressly permits DE NOVO
interstate branching. It was pursuant to authority from IBBEA that FUNB-NC
completed its reorganizations in June and July 1997. In addition, First Union
National Bank, based in Avondale, Pennsylvania, which conducts banking
operations in New York, New Jersey and Pennsylvania, is to be merged with
FUNB-NC in February 1998, pending regulatory approval.
7
<PAGE>
FDIC INSURANCE ASSESSMENTS; DIFA
Effective January 1, 1996, the FDIC reduced the insurance premiums it
currently charges on bank deposits insured by the Bank Insurance Fund ("BIF") to
the statutory minimum of $2,000 for "well capitalized" banks. The Deposit
Insurance Funds Act of 1996, which was enacted on September 30, 1996 ("DIFA"),
reduced the amount of semi-annual FDIC insurance premiums for savings
association deposits acquired by banks and insured by SAIF to the same levels
assessed for deposits insured by BIF. DIFA also provided for a special one-time
assessment imposed on deposits insured by SAIF, including such deposits held by
banks, to bring the SAIF up to statutorily required levels. The Corporation
accrued for the one-time assessment in the third quarter of 1996 in the amount
of $86 million after tax in connection with the SAIF recapitalization.
DIFA further provides for assessments to be imposed on insured depository
institutions with respect to deposits insured by the BIF, and continues the
assessments currently imposed on depository institutions with respect to
SAIF-insured deposits, to pay for the cost of Financing Corporation funding.
DESCRIPTION OF COMMON STOCK
The following summary of certain provisions of the Corporation's Articles
of Incorporation, as amended (the "Articles"), the Corporation's Bylaws (the
"Bylaws") and the Rights Agreement (as defined below) does not purport to be
complete and is qualified in its entirety by reference to such instruments, each
of which is an exhibit to the Registration Statement of which this Prospectus is
a part.
AUTHORIZED CAPITAL
The authorized capital stock of the Corporation consists of 750,000,000
shares of Common Stock, 10,000,000 shares of Preferred Stock and 40,000,000
shares of Class A Preferred Stock. Each outstanding share of Common Stock
currently has attached to it one right (a "Right") issued pursuant to an Amended
and Restated Shareholder Protection Rights Agreement (the "Rights Agreement").
Each Right entitles its registered holder to purchase one one-hundredth of a
share of a junior participating series of Class A Preferred Stock, as described
under " -- Rights Plan" below.
As of July 31, 1997, there were 561,374,603 shares of Common Stock, no
shares of Preferred Stock and no shares of Class A Preferred Stock issued and
outstanding. The number of shares of Common Stock outstanding on July 31, 1997,
reflects the payment on such date of a two-for-one stock split in the form of a
100 percent Common Stock dividend.
GENERAL
Subject to the prior rights of the holders of any Preferred Stock, Class A
Preferred Stock and Depositary Shares then outstanding, holders of Common Stock
are entitled to receive such dividends as may be declared by the Board of
Directors out of funds legally available therefor and, in the event of
liquidation or dissolution, to receive the net assets of the Corporation
remaining after payment of all liabilities and after payment to holders of all
shares of Preferred Stock and Class A Preferred Stock and to the holders of
Depositary Shares of the full preferential amounts to which such holders are
respectively entitled, in proportion to their respective holdings.
See "Certain Regulatory Considerations -- Payment of Dividends" for
information relating to certain regulatory restrictions on the payment of
dividends by banks, including the Corporation's subsidiary banks.
Pursuant to an indenture dated as of November 27, 1996, between the
Corporation and Wilmington Trust Company, as trustee, under which certain of the
Corporation's outstanding junior subordinated debt securities have been issued,
the Corporation has covenanted that it generally will not declare or pay any
dividends or distributions on, or redeem, repurchase, acquire or make a
liquidation payment with respect to, any of the Corporation's capital stock,
including the Common Stock, Preferred Stock and Class A Preferred Stock, if, at
such time, certain defaults have occurred under such indenture or a related
guarantee of the Corporation or the Corporation shall have exercised its right
under such indenture to defer interest payments on the securities issued
thereunder.
Subject to the rights of the holders of any Preferred Stock, Class A
Preferred Stock and Depositary Shares then outstanding, all voting rights are
vested in the holders of the shares of Common Stock, each share being entitled
to one vote on all matters requiring stockholder action and in the election of
directors. Holders of Common Stock have no preemptive, subscription or
conversion rights. All of the outstanding shares of Common Stock are, and any
issued and sold hereunder will be, fully paid and nonassessable.
FUNB-NC is the Transfer Agent, Registrar and Dividend Disbursement Agent
for the Common Stock.
8
<PAGE>
RIGHTS PLAN
Each outstanding share of Common Stock currently has attached to it one
Right issued pursuant to the Rights Agreement. Each Right entitles its
registered holder to purchase one one-hundredth of a share of a junior
participating series of Class A Preferred Stock designed to have economic and
voting terms similar to those of one share of Common Stock, for $105, subject to
adjustment (the "Rights Exercise Price"), but only after the earlier to occur
of: (i) the tenth business day (subject to extension) after any person (an
"Acquiring Person") (x) commences a tender or exchange offer, which, if
consummated, would result in a person becoming the beneficial owner of 15
percent or more of the outstanding shares of Common Stock, or (y) is determined
by the Federal Reserve Board to "control" the Corporation within the meaning of
the BHCA (see " -- Other Provisions" below), subject to certain exceptions; and
(ii) the tenth business day after the first date (the "Flip-in Date") of a
public announcement by the Corporation that a person has become an Acquiring
Person (in either case, the "Separation Time"). The Rights will not trade
separately from the shares of Common Stock unless and until the Separation Time
occurs.
The Rights Agreement provides that a person will not become an Acquiring
Person under the BHCA control test described above if either (i) the Federal
Reserve Board's control determination would not have been made but for such
person's failure to make certain customary passivity commitments, or such
person's violation of such commitments made, to the Federal Reserve Board, so
long as the Federal Reserve Board determines that such person no longer controls
the Corporation within 30 days (or 60 days in certain circumstances), or (ii)
the Federal Reserve Board's control determination was not based on such a
failure or violation and such person (x) obtains a noncontrol determination
within three years, and (y) is using its best efforts to allow the Corporation
to make any acquisition or engage in any legally permissible activity
notwithstanding such person's being deemed to control the Corporation for
purposes of the BHCA.
The Rights will not be exercisable until the business day following the
Separation Time. The Rights will expire on the earliest of: (i) the Exchange
Time (as defined below); (ii) the close of business on December 28, 2000; and
(iii) the date on which the Rights are redeemed or terminated as described below
(in any such case, the "Expiration Time"). The Rights Exercise Price and the
number of Rights outstanding, or in certain circumstances the securities
purchasable upon exercise of the Rights, are subject to adjustment upon the
occurrence of certain events.
In the event that prior to the Expiration Time a Flip-in Date occurs, the
Corporation will take such action as shall be necessary to ensure and provide
that each Right (other than Rights beneficially owned by an Acquiring Person or
any affiliate, associate or transferee thereof, which Rights shall become void)
shall constitute the right to purchase, from the Corporation, shares of Common
Stock having an aggregate market price equal to twice the Rights Exercise Price
for an amount in cash equal to the then current Rights Exercise Price. In
addition, the Board of Directors of the Corporation may, at its option, at any
time after a Flip-in Date, elect to exchange all of the then outstanding Rights
for shares of Common Stock, at an exchange ratio of two shares of Common Stock
per Right, appropriately adjusted to reflect any stock split, stock dividend or
similar transaction occurring after the Separation Time (the "Rights Exchange
Rate"). Immediately upon such action by the Board of Directors (the "Exchange
Time"), the right to exercise the Rights will terminate, and each Right will
thereafter represent only the right to receive a number of shares of Common
Stock equal to the Rights Exchange Rate. If the Corporation becomes obligated to
issue shares of Common Stock upon exercise of or in exchange for Rights, the
Corporation, at its option, may substitute therefor shares of junior
participating Class A Preferred Stock upon exercise of each Right at a rate of
two one-hundredths of a share of junior participating Class A Preferred Stock
upon the exchange of each Right.
The Rights may be canceled and terminated without any payment to holders
thereof at any time prior to the date that they become exercisable, and are
redeemable by the Corporation at $0.01 per Right, subject to adjustment upon the
occurrence of certain events, at any date between the date on which they become
exercisable and the Flip-in Date. The Rights have no voting rights, and they are
not entitled to dividends.
The Rights will not prevent a takeover of the Corporation. The Rights,
however, may cause substantial dilution to a person or group that acquires 15
percent or more of Common Stock unless the Rights are first redeemed or
terminated by the Board of Directors of the Corporation. Nevertheless, the
Rights should not interfere with a transaction that is in the best interests of
the Corporation and its stockholders because the Rights can be redeemed or
terminated, as hereinabove described, before the consummation of such
transaction.
The complete terms of the Rights are set forth in the Rights Agreement. The
Rights Agreement is incorporated by reference as an exhibit to the Registration
Statement of which this Prospectus is a part, and the foregoing description is
qualified in its entirety by reference thereto. A copy of the Rights Agreement
can be obtained upon written request to the Rights Agent, First Union National
Bank, 1525 West W.T. Harris Blvd., Charlotte, North Carolina 28288-1153.
9
<PAGE>
OTHER PROVISIONS
In addition to the Rights Plan, the Articles and Bylaws of the Corporation
contain a number of provisions which may be deemed to have the effect of
discouraging or delaying attempts to gain control of the Corporation, including
provisions in the Articles: (i) classifying the Board of Directors into three
classes with each class to serve for three years, with one class being elected
annually; (ii) authorizing the Board of Directors to fix the size of the Board
of Directors between nine and 30 directors; (iii) authorizing directors to fill
vacancies on the Board of Directors that occur between annual meetings, except
that vacancies resulting from a removal of a director by a stockholder vote may
only be filled by a stockholder vote; (iv) providing that directors may be
removed only for cause and only by affirmative vote of the majority of shares
entitled to be voted in the election of directors, voting as a single class; (v)
authorizing only the Board of Directors, the Chairman of the Board or the
President to call a special meeting of stockholders (except for special meetings
called under specified circumstances for holders of classes or series of stock
ranking superior to the Common Stock); and (vi) requiring an 80 percent vote of
stockholders entitled to vote in the election of directors, voting as a single
class, to alter any of the foregoing provisions.
The Bylaws include provisions setting forth specific conditions under
which: (i) business may be transacted at an annual meeting of stockholders; and
(ii) persons may be nominated for election as directors of the Corporation at an
annual meeting of stockholders.
The Change in Bank Control Act prohibits a person or group of persons from
acquiring "control" of a bank holding company unless the Federal Reserve Board
has been given 60 days' prior written notice of such proposed acquisition, and
within that time period, the Federal Reserve Board has not issued a notice
disapproving the proposed acquisition or extending for up to another 30 days the
period during which such a disapproval may be issued, or unless the acquisition
is subject to Federal Reserve Board approval under the BHCA. An acquisition may
be made prior to the expiration of the disapproval period if the Federal Reserve
Board issues written notice of its intent not to disapprove the action. Under a
rebuttable presumption established by the Federal Reserve Board, the acquisition
of more than ten percent of a class of voting stock of a bank holding company
with a class of securities registered under Section 12 of the Exchange Act, such
as the Corporation, would, under the circumstances set forth in the presumption,
constitute the acquisition of control.
In addition, any "company" would be required to obtain the approval of the
Federal Reserve Board under the BHCA before acquiring 25 percent (five percent
in the case of an acquiror that is a bank holding company) or more of the
outstanding shares of Common Stock, or otherwise obtaining "control" over the
Corporation. Under the BHCA, "control" generally means (i) the ownership or
control of 25 percent or more of any class of voting securities of the bank
holding company, (ii) the ability to elect a majority of the bank holding
company's directors, or (iii) the ability otherwise to exercise a controlling
influence over the management and policies of the bank holding company.
Two North Carolina "anti-takeover" statutes adopted in 1987, The North
Carolina Shareholder Protection Act and The North Carolina Control Share
Acquisition Act, allowed North Carolina corporations to elect to either be
covered or not be covered by such statutes. The Corporation elected not to be
covered by such statutes.
In addition to the foregoing, in certain instances the issuance of
authorized but unissued shares of Common Stock, Preferred Stock or Class A
Preferred Stock may have an anti-takeover effect.
The existence of the foregoing provisions could result in (i) the
Corporation being less attractive to a potential acquiror, and (ii) the
Corporation's stockholders receiving less for their shares of Common Stock than
otherwise might be available in the event of a take-over attempt.
10
<PAGE>
DESCRIPTION OF PREFERRED STOCK AND CLASS A PREFERRED STOCK
The following summary of the Preferred Stock and the Class A Preferred
Stock does not purport to be complete and is qualified in its entirety by
reference to the Articles, as amended with respect to each series of Preferred
Stock or Class A Preferred Stock, which Articles are, and which amendments will
be, incorporated by reference in the Registration Statement of which this
Prospectus is a part in connection with the issuance of such series of Preferred
Stock or Class A Preferred Stock. Such summary relates to certain terms and
conditions applicable to the Preferred Stock as a class and the Class A
Preferred Stock as a class. The particular terms of any series of Preferred
Stock or Class A Preferred Stock will be described in the applicable Prospectus
Supplement. If so indicated in such Prospectus Supplement, the terms of any such
series may differ from the terms set forth below.
GENERAL
Under the Articles, the Preferred Stock and the Class A Preferred Stock may
be issued from time to time in one or more series, without stockholder approval,
when authorized by the Board of Directors. Subject to limitations prescribed by
law, the Board of Directors is authorized to determine the voting powers (if
any), designation, preferences and relative, participating, optional or other
rights, if any, and the qualifications, limitations or restrictions thereof, if
any, including specifically, but not limited to, the dividend rights, conversion
rights, exchange rights, redemption rights, liquidation preferences and voting
rights, if any, of any then unissued series of Preferred Stock or Class A
Preferred Stock (or the entire class of Preferred Stock or Class A Preferred
Stock, if none of such shares have been issued), the designation and number of
shares constituting any such series and the terms and conditions of the issuance
thereof. Thus, the Board of Directors, without stockholder approval, could
authorize the issuance of Preferred Stock or Class A Preferred Stock with
voting, conversion and other rights that could adversely affect the voting power
and other rights of holders of Common Stock or other outstanding series of
Preferred Stock or Class A Preferred Stock.
Each series of Preferred Stock or Class A Preferred Stock will have the
dividend, liquidation, redemption and voting rights set forth below unless
otherwise described in an applicable Prospectus Supplement relating to such
series of Preferred Stock or Class A Preferred Stock. The applicable Prospectus
Supplement will describe the following terms of the series of Preferred Stock or
Class A Preferred Stock in respect of which this Prospectus is being delivered:
(i) the designation of such series and the number of shares offered; (ii) the
amount of the liquidation preference per share (or the method of calculation of
such amount); (iii) the initial public offering price at which shares of such
series will be issued; (iv) the dividend rate (or the method of calculation of
such rate) applicable to such series, the dates on which dividends will be
payable and the dates from which dividends will commence to cumulate, if any;
(v) any redemption or sinking fund provisions; (vi) any conversion or exchange
rights; (vii) any additional voting and other rights, preferences, privileges,
qualifications, limitations and restrictions; (viii) any listing of such series
on any securities exchange; (ix) the relative ranking and preferences of such
series as to dividend rights and rights upon any liquidation, dissolution or
winding up of the affairs of the Corporation; and (x) any other terms of such
series.
Pursuant to an indenture dated as of November 27, 1996, between the
Corporation and Wilmington Trust Company, as trustee, under which certain of the
Corporation's outstanding junior subordinated debt securities have been issued,
the Corporation has covenanted that it generally will not declare or pay any
dividends or distributions on, or redeem, repurchase, acquire or make a
liquidation payment with respect to, any of the Corporation's capital stock,
including the Common Stock, Preferred Stock and Class A Preferred Stock, if, at
such time, certain defaults have occurred under such indenture or a related
guarantee of the Corporation or the Corporation shall have exercised its right
under such indenture to defer interest payments on the securities issued
thereunder.
No shares of Preferred Stock or Class A Preferred Stock are currently
outstanding. Shares of Preferred Stock and Class A Preferred Stock, upon
issuance against full payment of the purchase price therefor, will be fully paid
and nonassessable. The liquidation preference of any series of Preferred Stock
or Class A Preferred Stock is not necessarily indicative of the price at which
shares of such series of Preferred Stock or Class A Preferred Stock will
actually trade on or after the date of issuance.
RANK
Each series of Preferred Stock and Class A Preferred Stock will, with
respect to dividend rights and rights upon liquidation, dissolution or winding
up of the Corporation, rank prior or superior to the Common Stock. All shares of
each series of Preferred Stock will be of equal rank with each other. Shares of
Class A Preferred Stock will rank on a parity with or junior to (but not prior
or superior to) Preferred Stock or any series thereof. Subject to the foregoing
and the terms of any particular series of Class A Preferred Stock, series of
Class A Preferred Stock may vary as to priority within that class.
11
<PAGE>
DIVIDENDS
Holders of each series of Preferred Stock and Class A Preferred Stock will
be entitled to receive, when, as and if declared by the Board of Directors out
of funds of the Corporation legally available for payment, cash dividends,
payable at such date or dates and at such rate or rates per share as described
in the applicable Prospectus Supplement. Such rate or rates may be fixed or
variable or both.
Dividends may be cumulative or noncumulative, as described in the
applicable Prospectus Supplement. If dividends on a series of Preferred Stock or
Class A Preferred Stock are noncumulative and if the Board of Directors fails to
declare a dividend in respect of a dividend period with respect to such series,
then holders of such Preferred Stock or Class A Preferred Stock will have no
right to receive a dividend in respect of such dividend period, and the
Corporation will have no obligation to pay the dividend for such period, whether
or not dividends are declared with respect to any future dividend payment dates.
If dividends on a series of Preferred Stock or Class A Preferred Stock are
cumulative, the dividends on such shares will accrue from and after the date set
forth in the applicable Prospectus Supplement.
No full dividends may be declared or paid or set apart for payment on any
series of Preferred Stock or Class A Preferred Stock ranking, as to dividends,
on a parity with or junior to the series of Preferred Stock or Class A Preferred
Stock offered by the applicable Prospectus Supplement (the "Offered Stock") for
any period unless full dividends for the immediately preceding dividend period
on such Offered Stock (including any accumulation in respect of unpaid dividends
for prior dividend periods, if dividends on such Offered Stock are cumulative)
have been or contemporaneously are declared and paid or declared and a sum
sufficient for the payment thereof is set apart for such payment. When dividends
are not so paid in full (or a sum sufficient for such full payment is not so set
apart) upon such Offered Stock and any other parity stock, dividends upon such
Offered Stock and dividends upon such parity stock will be declared pro rata so
that the amount of dividends declared per share on such Offered Stock and such
parity stock will in all cases bear to each other the same ratio that accrued
dividends for the then current dividend period per share on such Offered Stock
(including any accumulation in respect of unpaid dividends for prior dividend
periods, if dividends on such Offered Stock are cumulative) and accrued
dividends, including required or permitted accumulations, if any, on such parity
stock, bear to each other. No interest, or sum of money in lieu of interest,
will be payable in respect of any dividend payment on such Offered Stock that
may be in arrears. Unless full dividends on the Offered Stock have been declared
and paid or set apart for payment for the immediately preceding dividend period
(including any accumulation in respect of unpaid dividends for prior dividend
periods, if dividends on such Offered Stock are cumulative), (i) no cash
dividend or distribution (other than in junior stock) may be declared, set aside
or paid on junior stock (including Common Stock), (ii) the Corporation may not,
directly or indirectly, repurchase, redeem or otherwise acquire any junior stock
(or pay any monies into a sinking fund for the redemption of any junior stock)
except by conversion into or exchange for junior stock, and (iii) the
Corporation may not, directly or indirectly, repurchase, redeem or otherwise
acquire any parity stock (or pay any monies into a sinking fund for the
redemption of any parity stock) otherwise than pursuant to pro rata offers to
purchase or a concurrent redemption of all, or a pro rata portion, of the
Offered Stock and such parity stock (except by conversion into or exchange for
junior stock).
Any dividend payment made on a series of Preferred Stock or Class A
Preferred Stock will first be credited against the earliest accrued but unpaid
dividend due with respect to shares of such series that remains payable.
See "Certain Regulatory Considerations -- Payment of Dividends" for
information relating to certain regulatory restrictions on the payment of
dividends by banks, including the Corporation's subsidiary banks.
REDEMPTION
The terms, if any, on which Preferred Stock or Class A Preferred Stock of
any series may be redeemed will be set forth in the applicable Prospectus
Supplement. All shares of Preferred Stock or Class A Preferred Stock redeemed,
purchased or otherwise acquired by the Corporation (including shares surrendered
for conversion or exchange) shall be cancelled and thereupon restored to the
status of authorized but unissued shares of Preferred Stock or Class A Preferred
Stock, as the case may be, undesignated as to series.
LIQUIDATION
In the event of a voluntary or involuntary liquidation, dissolution or
winding up of the affairs of the Corporation, the holders of a series of
Preferred Stock or Class A Preferred Stock will be entitled, subject to the
rights of creditors, but before any distribution or payment to the holders of
Common Stock or any other junior stock, to receive a liquidating distribution in
the amount of the liquidation preference per share as set forth in the
applicable Prospectus Supplement, plus accrued and unpaid dividends for the then
current dividend period (including any accumulation in respect of unpaid
dividends for prior dividend periods, if dividends on such series of Preferred
Stock or Class A Preferred Stock are cumulative). If the amounts available for
distribution upon liquidation, dissolution or winding up of the affairs of the
Corporation are not sufficient to
12
<PAGE>
satisfy the full liquidation rights of all the outstanding Preferred Stock or
Class A Preferred Stock and all stock ranking on a parity with such Preferred
Stock or Class A Preferred Stock, then the holders of each series of such stock
will share ratably in any such distribution of assets in proportion to the full
respective preferential amount (which in the case of Preferred Stock or Class A
Preferred Stock may include accumulated dividends) to which they are entitled.
After payment of the full amount of the liquidation preference, the holders of
Preferred Stock or Class A Preferred Stock will not be entitled to any further
participation in any distribution of assets by the Corporation.
VOTING
The terms, if any, on which Preferred Stock or Class A Preferred Stock of
any series may be entitled to vote will be set forth in the applicable
Prospectus Supplement. The shares of any series of Preferred Stock having voting
rights may not have more than one vote per share. The shares of any series of
Class A Preferred Stock having voting rights shall have such number of votes per
share (which may be more or less than one) as are specified in the amendment to
the Articles with respect to such series and in the applicable Prospectus
Supplement.
The North Carolina Business Corporation Act provides that, regardless of
whether a class or series of shares is granted voting rights by the terms of the
articles of incorporation of the North Carolina corporation issuing such shares,
the holders of shares of such class or series are entitled to vote as a separate
voting group (in certain cases together with other similarly affected series) on
certain amendments to the articles of incorporation and certain other
fundamental changes in the corporation that directly affect such class or
series.
Under regulations adopted by the Federal Reserve Board, if the holders of
any series of Preferred Stock or Class A Preferred Stock become entitled to vote
for the election of directors because dividends on such series are in arrears,
such series may then be deemed a "class of voting securities," and a holder of
25 percent or more of such series (or a holder of five percent or more if it
otherwise exercises a "controlling influence" over the Corporation) may then be
subject to regulation as a bank holding company in accordance with the BHCA. In
addition, at such time (i) any bank holding company may be required to obtain
the approval of the Federal Reserve Board under the BHCA, and any foreign bank,
and any company that controls a foreign bank, that has certain types of United
States banking operations may be required to obtain the approval of the Federal
Reserve Board under the International Banking Act of 1978, as amended, to
acquire or retain five percent or more of any series of Preferred Stock or Class
A Preferred Stock, and (ii) any person other than a bank holding company may be
required to obtain the approval of the Federal Reserve Board under the Change in
Bank Control Act to acquire ten percent or more of such series of Preferred
Stock or Class A Preferred Stock.
CONVERSION OR EXCHANGE
The terms, if any, on which Preferred Stock or Class A Preferred Stock of
any series may be converted into or exchanged for another class or series of
Securities will be set forth in the applicable Prospectus Supplement.
OTHER RIGHTS
The shares of a series of Preferred Stock or Class A Preferred Stock may
have such preferences, voting powers or relative, participating, optional or
other special rights as may be set forth in the applicable Prospectus
Supplement, the Articles (including the applicable amendment to the Articles) or
as otherwise required by law. The holders of Preferred Stock and Class A
Preferred Stock will not have any preemptive rights to subscribe to any
securities of the Corporation. Any shares of Preferred Stock or Class A
Preferred Stock sold hereunder will be fully paid and nonassessable.
TITLE
The Corporation, the transfer agent and registrar for a series of Preferred
Stock or Class A Preferred Stock, and any agent of the Corporation or the
transfer agent and registrar may treat the registered owner of such Preferred
Stock or Class A Preferred Stock as the absolute owner thereof (whether or not
any payment in respect of such Preferred Stock or Class A Preferred Stock shall
be overdue and notwithstanding any notice to the contrary) for the purpose of
making payment and for all other purposes. See "Global Securities".
TRANSFER AGENT AND REGISTRAR
The Transfer Agent, Registrar and Dividend Disbursement Agent for each
series of Preferred Stock or Class A Preferred Stock will be named in the
applicable Prospectus Supplement.
DESCRIPTION OF DEPOSITARY SHARES
The following summary of each Deposit Agreement, the Depositary Shares and
the Depositary Receipts (each as defined below) does not purport to be complete
and is qualified in its entirety by reference to the Deposit Agreement and
13
<PAGE>
Depositary Receipts with respect to the Depositary Shares relating to any
particular series of Preferred Stock or Class A Preferred Stock, the forms of
which will be incorporated by reference as exhibits to the Registration
Statement of which this Prospectus is a part in connection with the issuance of
such Depositary Shares. Such summary relates to certain terms and conditions
applicable to Depositary Shares generally. The particular terms of any series of
Depositary Shares will be described in the applicable Prospectus Supplement. If
so indicated in such Prospectus Supplement, the terms of any such series may
differ from the terms set forth below.
GENERAL
The Corporation may, at its option, elect to offer fractional interests in
shares of Preferred Stock or Class A Preferred Stock, rather than shares of
Preferred Stock or Class A Preferred Stock. If the Corporation elects to do so,
it will provide for the issuance by a Depositary (as described below) to the
public of Depositary Shares, each of which will represent a fractional interest
(to be set forth in the applicable Prospectus Supplement) of a share of
Preferred Stock or Class A Preferred Stock (the "Depositary Shares").
The shares of any series of the Preferred Stock or the Class A Preferred
Stock underlying any Depositary Shares will be deposited under a separate
Deposit Agreement (each, a "Deposit Agreement") between the Corporation and a
bank or trust company selected by the Corporation with respect to such series,
having its principal office in the United States and having a combined capital
and surplus of at least $50,000,000 (with respect to such series, the
"Depositary"). The applicable Prospectus Supplement relating to a series of
Depositary Shares will set forth the name and address of the Depositary. Subject
to the terms of the applicable Deposit Agreement, each owner of a Depositary
Share will be entitled, in proportion to the applicable fractional interest in a
share of the Preferred Stock or the Class A Preferred Stock underlying such
Depositary Share, to all the rights and preferences of such Preferred Stock or
Class A Preferred Stock (including dividend, voting, redemption, conversion,
exchange and liquidation rights).
Depositary Shares will be evidenced by one or more depositary receipts
issued pursuant to the applicable Deposit Agreement (the "Depositary Receipts").
Pending the preparation of definitive engraved Depositary Receipts, a
Depositary may, upon the Corporation's written order, issue temporary Depositary
Receipts substantially identical to (and entitling the holders thereof to all
the rights pertaining to) the definitive Depositary Receipts but not in
definitive form. Definitive Depositary Receipts will be prepared without
unreasonable delay, and the temporary Depositary Receipts will be exchangeable
for definitive Depositary Receipts at the Corporation's expense.
DIVIDENDS AND OTHER DISTRIBUTIONS
The Depositary will distribute all cash dividends or other cash
distributions received by the Depositary in respect of the Preferred Stock or
the Class A Preferred Stock to the record holders of Depositary Shares relating
to such Preferred Stock or Class A Preferred Stock pro rata in proportion to the
number of such Depositary Shares owned by such holders on the relevant record
date. The Depositary will distribute only such amount, however, as can be
distributed without attributing to any holder of Depositary Shares a fraction of
one cent, and any balance not so distributed will be added to and treated as
part of the next sum received by the Depositary for distribution to record
holders of such Depositary Shares.
In the event of a distribution other than in cash, the Depositary will
distribute property received by it to the record holders of Depositary Shares
entitled thereto, unless the Depositary determines that it is not feasible to
make such distribution, in which case the Depositary may, with the Corporation's
approval, adopt such method as it deems equitable and practicable for the
purpose of effecting such distribution, including the sale of such property and
the distribution of the net proceeds from such sale to such holders.
Each Deposit Agreement will also contain provisions relating to the manner
in which any subscription or similar rights offered by the Corporation to
holders of the Preferred Stock or the Class A Preferred Stock of the applicable
series will be made available to holders of Depositary Shares.
WITHDRAWAL OF STOCK
Upon surrender of Depositary Receipts at the office of the Depositary
(unless the related Depositary Shares have previously been called for
redemption), the holder of the Depositary Shares evidenced thereby will be
entitled to delivery at such office to or upon such holder's order, of the
number of whole shares of the related series of Preferred Stock or Class A
Preferred Stock and any money or other property represented by such Depositary
Shares. Holders of Depositary Shares will be entitled to receive whole shares of
the related series of Preferred Stock or Class A Preferred Stock, as the case
may be, on the basis set forth in the applicable Prospectus Supplement, but
holders of such whole shares of such Preferred Stock or Class A Preferred Stock
will not thereafter be entitled to receive Depositary Shares in exchange
therefor. If the Depositary Receipts
14
<PAGE>
delivered by the holder evidence a number of Depositary Shares in excess of the
number of Depositary Shares representing the number of whole shares of the
related series of Preferred Stock or Class A Preferred Stock to be withdrawn,
the Depositary will deliver to such holder at the same time a new Depositary
Receipt evidencing such excess number of Depositary Shares.
REDEMPTION; LIQUIDATION
The terms, if any, on which the Depositary Shares relating to the Preferred
Stock or the Class A Preferred Stock of any series may be redeemed, and any
amounts distributable upon any voluntary or involuntary liquidation, dissolution
or winding up of the affairs of the Corporation, will be set forth in the
applicable Prospectus Supplement.
VOTING
Upon receipt of notice of any meeting at which the holders of the Preferred
Stock or Class A Preferred Stock of any series are entitled to vote, the
applicable Depositary will mail the information contained in such notice of
meeting to the record holders of the Depositary Shares relating to such series
of Preferred Stock or Class A Preferred Stock. Each record holder of such
Depositary Shares on the record date (which will be the same date as the record
date for the Preferred Stock or the Class A Preferred Stock, as the case may be)
will be entitled to instruct the Depositary as to the exercise of the voting
rights pertaining to the number of shares of Preferred Stock or Class A
Preferred Stock underlying such holder's Depositary Shares. The Depositary will
endeavor, insofar as practicable, to vote the number of shares of Preferred
Stock or Class A Preferred Stock underlying such Depositary Shares in accordance
with such instructions, and the Corporation will agree to take all action that
may be deemed reasonably necessary by the Depositary in order to enable the
Depositary to do so. To the extent the Depositary does not receive specific
instructions from the holders of Depositary Shares relating to such Preferred
Stock or Class A Preferred Stock, it will abstain from voting such shares of
Preferred Stock or Class A Preferred Stock, unless otherwise indicated in the
applicable Prospectus Supplement.
AMENDMENT AND TERMINATION OF DEPOSITARY AGREEMENT
The form of Depositary Receipt evidencing the Depositary Shares and any
provision of the applicable Deposit Agreement may at any time be amended by
agreement between the Corporation and the Depositary. However, any amendment
that materially and adversely alters the rights of the existing holders of
Depositary Shares will not be effective unless such amendment has been approved
by the record holders of a majority of the Depositary Shares then outstanding. A
Deposit Agreement may be terminated by the Corporation or the Depositary only if
(i) all outstanding Depositary Shares relating thereto have been redeemed or
otherwise reacquired by the Corporation, (ii) all Preferred Stock or Class A
Preferred Stock of the applicable series has been withdrawn, or (iii) there has
been a final distribution in respect of the Preferred Stock or the Class A
Preferred Stock of the applicable series in connection with any voluntary or
involuntary liquidation, dissolution or winding up of the affairs of the
Corporation and such distribution has been distributed to the holders of the
related Depositary Shares.
CHARGES OF DEPOSITARY
The Corporation will pay all charges of each Depositary in connection with
the initial deposit of the Preferred Stock or the Class A Preferred Stock of any
series and any redemption of such Preferred Stock or Class A Preferred Stock.
Holders of Depositary Shares will be required to pay any other transfer and
other taxes and governmental charges and such other charges as are expressly
provided in the Deposit Agreement to be for their accounts.
MISCELLANEOUS
Each Depositary will forward to the holders of the applicable Depositary
Shares all reports and communications from the Corporation that are delivered to
such Depositary and that the Corporation is required to furnish to the holders
of the Preferred Stock or the Class A Preferred Stock of the applicable series.
Neither any Depositary nor the Corporation will be liable if it is
prevented or delayed by law or any circumstance beyond its control in performing
its obligations under any Deposit Agreement. The obligations of the Corporation
and each Depositary under any Deposit Agreement will be limited to performance
in good faith of their duties thereunder, and they will not be obligated to
prosecute or defend any legal proceeding in respect of any Depositary Shares,
Preferred Stock or Class A Preferred Stock unless indemnity satisfactory to them
is furnished. They may rely upon written advice of counsel or accountants, or
information provided by persons presenting Preferred Stock or Class A Preferred
Stock for deposit, holders of Depositary Shares or other persons believed to be
competent and on documents believed to be genuine.
15
<PAGE>
TITLE
The Corporation, each Depositary and any agent of the Corporation or the
applicable Depositary may treat the registered owner of any Depositary Share as
the absolute owner thereof (whether or not any payment in respect of such
Depositary Share shall be overdue and notwithstanding any notice to the
contrary) for the purpose of making payment and for all other purposes. See
"Global Securities".
RESIGNATION AND REMOVAL OF DEPOSITARY
A Depositary may resign at any time by delivering to the Corporation notice
of its election to do so, and the Corporation may at any time remove a
Depositary, and such resignation or removal will take effect upon the
appointment of a successor Depositary and its acceptance of such appointment.
Such successor Depositary must (i) be appointed within 60 days after delivery of
the notice of resignation or removal, (ii) be a bank or trust company having its
principal office in the United States, and (iii) have combined capital and
surplus of at least $50,000,000.
16
<PAGE>
DESCRIPTION OF THE DEBT SECURITIES
GENERAL
The following summary of the Indentures (as defined below) and the Debt
Securities does not purport to be complete and is qualified in its entirety by
reference to the applicable Indenture pursuant to which such Debt Securities are
issued, which Indentures are incorporated by reference as exhibits to the
Registration Statement of which this Prospectus is a part. Such summary relates
to certain terms and conditions applicable to the Debt Securities generally. The
particular terms of any series of Debt Securities will be described in the
applicable Prospectus Supplement. If so indicated in such Prospectus Supplement,
the terms of any such series may differ from the terms set forth below.
Senior Debt Securities are to be issued under an Indenture, dated as of
April 1, 1983, as amended by supplemental indentures dated as of May 17, 1986,
July 1, 1988 and August 1, 1990 (the "Senior Indenture"), between the
Corporation and The Chase Manhattan Bank (formerly Chemical Bank), as Trustee
(the "Senior Trustee"). Subordinated Debt Securities are to be issued under an
Indenture, dated as of March 15, 1986, as amended by supplemental indentures
dated as of August 1, 1990, November 15, 1992 and February 7, 1996 (the
"Subordinated Indenture" and together with the Senior Indenture, the
"Indentures"), between the Corporation and Harris Trust and Savings Bank, as
successor Trustee to The Bank of New York (formerly Irving Trust Company) (the
"Subordinated Trustee", and together with the Senior Trustee, the "Trustees").
The following summaries of certain provisions of the Senior Debt Securities, the
Subordinated Debt Securities, the Senior Indenture and the Subordinated
Indenture, as modified or superseded by the applicable Prospectus Supplement,
are brief summaries of certain provisions thereof, do not purport to be complete
and are subject to, and are qualified in their entirety by reference to, all the
provisions of the Indenture applicable to a particular series of Debt Securities
(the "Applicable Indenture"), including the definitions therein of certain
terms. Whenever particular provisions or defined terms in one or both of the
Indentures are referred to, such provisions or defined terms are incorporated
herein by reference. Section references used herein are references to the
Applicable Indenture. Capitalized terms not otherwise defined herein shall have
the meaning given to them in the Applicable Indenture.
The Debt Securities will be limited to an aggregate initial offering price
of $2,390,000,000 (or, at the option of the Corporation if so specified in the
applicable Prospectus Supplement, the equivalent thereof in any other currency
or currency unit such as the European Currency Unit), and will be direct,
unsecured obligations of the Corporation. The Debt Securities will not be
deposits or other obligations of a bank and will not be insured by the FDIC.
The Indentures do not limit the aggregate principal amount of Debt
Securities or of any particular series of Debt Securities which may be issued
thereunder and provide that Debt Securities issued thereunder may be issued from
time to time in one or more series, in each case with the same or various
maturities, at par or at a discount. (SECTION 301). The Indentures provide that
there may be more than one trustee under the Indentures with respect to
different series of Debt Securities. As of June 30, 1997, $809 million aggregate
principal amount of Senior Debt Securities was issued and outstanding under the
Senior Indenture. The Senior Trustee is trustee for such series. As of June 30,
1997, $4.0 billion aggregate principal amount of Subordinated Debt Securities
was issued and outstanding under the Subordinated Indenture. The Subordinated
Trustee is trustee for such series.
The Indentures do not limit the amount of other debt that may be issued by
the Corporation and do not contain financial or similar restrictive covenants.
As of June 30, 1997, the Corporation had an aggregate of $1.7 billion of
short-term Senior Indebtedness outstanding which consisted primarily of
commercial paper. The Corporation expects from time to time to incur additional
indebtedness constituting Senior Indebtedness and Other Financial Obligations
(as defined below). The Indentures do not prohibit or limit the incurrence of
additional Senior Indebtedness or Other Financial Obligations.
Because the Corporation is a holding company and a legal entity separate
and distinct from its subsidiaries, the rights of the Corporation to participate
in any distribution of assets of any subsidiary upon its liquidation of assets
or reorganization or otherwise (and thus the ability of Holders of Debt
Securities to benefit indirectly from such distribution) would be subject to the
prior claims of creditors of that subsidiary, except to the extent that the
Corporation itself may be a creditor of that subsidiary with recognized claims.
Claims on the Corporation's subsidiary banks by creditors other than the
Corporation include long-term debt and substantial obligations with respect to
deposit liabilities and federal funds purchased, securities sold under
repurchase agreements, other short-term borrowings and various other financial
obligations. The Indentures do not contain any covenants designed to afford
Holders of Debt Securities protection in the event of a highly leveraged
transaction involving the Corporation.
Reference is made to the applicable Prospectus Supplement for the following
terms of the Debt Securities offered thereby: (i) the title of the Debt
Securities; (ii) whether the Debt Securities are Senior Debt Securities or
Subordinated Debt
17
<PAGE>
Securities; (iii) any limit upon the aggregate principal amount of the Debt
Securities and the percentage of such principal amount at which such Debt
Securities may be issued; (iv) the date or dates on which the principal of the
Debt Securities is payable (the "Stated Maturity"); (v) the rate or rates (which
may be fixed or variable) per annum at which the Debt Securities will bear
interest, or the method of determining such rate or rates, if any, the date or
dates from which any such interest will accrue, the Interest Payment Dates on
which any such interest will be payable, the Regular Record Date for the
interest payable on any Interest Payment Date, the Person to whom any Debt
Security of such series will be payable, if other than the Person in whose name
that Debt Security (or one or more predecessor Debt Securities) is registered at
the close of business on the Regular Record Date for such interest and the
extent to which, or the manner in which, any interest payable on a permanent
global Debt Security on an Interest Payment Date will be paid; (vi) if other
than the location specified in this Prospectus, the place or places where the
principal of and premium, if any, and interest on the Debt Securities will be
payable; (vii) the period or periods within which, the price or prices at which
and the terms and conditions upon which the Debt Securities will, pursuant to
any mandatory sinking fund provisions or otherwise, or may, pursuant to any
optional sinking fund provisions or otherwise, be redeemed in whole or in part
by the Corporation; (viii) the period or periods within which, the price or
prices at which and the terms and conditions upon which the Debt Securities may
be repaid, in whole or in part, at the option of the Holders thereof; (ix) if
other than denominations of $1,000 and any integral multiple thereof, the
denominations in which the Debt Securities shall be issuable; (x) if other than
the principal amount thereof, the portion of the principal amount of the Debt
Securities which shall be payable upon declaration of acceleration of the
maturity thereof; (xi) the currency or currency unit of payment of principal and
premium, if any, and interest on such Debt Securities, and any index used to
determine the amount of payment of principal or premium, if any, and interest on
such Debt Securities; (xii) whether the Debt Securities are to be issuable in
permanent global form and, in such case, the initial depository with respect
thereto and the circumstances under which such permanent global Debt Security
may be exchanged; (xiii) whether the subordination provisions summarized below
or different subordination provisions, including a different definition of
"Senior Indebtedness", "Entitled Persons", "Existing Subordinated Indebtedness"
or "Other Financial Obligations", shall apply to the Debt Securities; (xiv) the
terms and conditions of any obligation or right of the Corporation or a Holder
to convert or exchange Subordinated Debt Securities into other Securities; and
(xv) any other material terms of the Debt Securities not specified in this
Prospectus. (SECTION 301). Where appropriate, the applicable Prospectus
Supplement will describe the United States federal income tax considerations
relevant to the Debt Securities.
Unless otherwise indicated in the applicable Prospectus Supplement,
principal, premium, if any, and interest, if any, on the Debt Securities will be
payable, and the Debt Securities will be transferable, at the Corporate Trust
Office of FUNB-NC in Charlotte, North Carolina, except that interest may be paid
at the option of the Corporation by check mailed to the address of the Holder
entitled thereto as it appears on the Security Register. (SECTIONS 301, 305 and
1002).
Unless otherwise indicated in the applicable Prospectus Supplement, the
Debt Securities will be issued only in fully registered form, without coupons,
in denominations of $1,000 and any integral multiple thereof. (SECTION 302). The
Indentures provide that Debt Securities of any series may be issuable in
permanent global form (SECTION 301) and, unless otherwise specified in the
applicable Prospectus Supplement, Debt Securities will be issued in permanent
global form. See "Global Securities". No service charge will be made for any
registration of transfer or exchange of the Debt Securities, but the Corporation
may require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith. (SECTION 305).
Both Senior Debt Securities and Subordinated Debt Securities may be issued
as Original Issue Discount Securities to be offered and sold at a substantial
discount below their stated principal amount. Federal income tax consequences
and other special considerations applicable to any such Original Issue Discount
Securities will be described in the applicable Prospectus Supplement. "Original
Issue Discount Security" means any security which provides for an amount less
than the principal amount thereof to be due and payable upon the declaration of
acceleration of the maturity thereof in accordance with the terms of the related
Indenture. (SECTION 101).
Reference is made to the Prospectus Supplement relating to any series of
Debt Securities that are Original Issue Discount Securities for the particular
provisions relating to acceleration of the maturity of a portion of the
principal amount of such series of Original Issue Discount Securities upon the
occurrence of an Event of Default and the continuation thereof.
SUBORDINATION OF THE SUBORDINATED DEBT SECURITIES
The obligations of the Corporation to make any payment on account of the
principal of and interest on any Subordinated Debt Securities will, to the
extent set forth in the Subordinated Indenture, be subordinate and junior in
right of payment to all Senior Indebtedness of the Corporation. Unless otherwise
specified in the Prospectus Supplement relating to the particular
18
<PAGE>
series of Subordinated Debt Securities offered thereby, "Senior Indebtedness" of
the Corporation is defined in the Subordinated Indenture to mean the principal
of, premium, if any, and interest on (i) all indebtedness of the Corporation for
money borrowed (including indebtedness of others guaranteed by the Corporation)
other than the Subordinated Debt Securities, whether outstanding on the date of
execution of the Indenture or thereafter created, assumed or incurred, except
(a) any obligations on account of Existing Subordinated Indebtedness, and (b)
such indebtedness as is by terms expressly stated to be not superior in right of
payment to the Subordinated Debt Securities or to rank PARI PASSU with the
Subordinated Debt Securities, and (ii) any deferrals, renewals or extensions of
any such Senior Indebtedness. The term "indebtedness of the Corporation for
money borrowed" is defined in the Subordinated Indenture to mean any obligation
of, or any obligation guaranteed by, the Corporation for the repayment of
borrowed money, whether or not evidenced by bonds, debentures, notes or other
written instruments, and any deferred obligation for the payment of the purchase
price of property or assets. (SECTION 101 and ARTICLE FOURTEEN of the
Subordinated Indenture).
The payment of the principal of and interest on the Subordinated Debt
Securities will, to the extent set forth in the Subordinated Indenture, be
subordinated in right of payment to the prior payment in full of all Senior
Indebtedness. Unless otherwise specified in the Prospectus Supplement relating
to the particular series of Subordinated Debt Securities offered thereby, in
certain events of insolvency, the payment of the principal of and interest on
the Subordinated Debt Securities, other than Subordinated Debt Securities that
are also Existing Subordinated Indebtedness (as defined below), will, to the
extent set forth in the Subordinated Indenture, also be effectively subordinated
in right of payment to the prior payment in full of all Other Financial
Obligations. Upon any payment or distribution of assets to creditors upon any
liquidation, dissolution, winding up, reorganization, assignment for the benefit
of creditors, marshalling of assets or any bankruptcy, insolvency or similar
proceedings of the Corporation, the holders of all Senior Indebtedness will
first be entitled to receive payment in full of all amounts due or to become due
thereon before the Holders of the Subordinated Debt Securities will be entitled
to receive any payment in respect of the principal of or interest on the
Subordinated Debt Securities. If upon any such payment or distribution of assets
to creditors, there remains, after giving effect to such subordination
provisions in favor of the holders of Senior Indebtedness, any amount of cash,
property or securities available for payment or distribution in respect of
Subordinated Debt Securities (defined in the Subordinated Indenture as "Excess
Proceeds") and if, at such time, any Entitled Persons (as defined below) in
respect of Other Financial Obligations have not received payment in full of all
amounts due or to become due on or in respect of such Other Financial
Obligations, then such Excess Proceeds shall first be applied to pay or provide
for the payment in full of such Other Financial Obligations before any payment
or distribution may be made in respect of the Subordinated Debt Securities which
are not Existing Subordinated Indebtedness. In the event of the acceleration of
the maturity of any Subordinated Debt Securities, the holders of all Senior
Indebtedness will first be entitled to receive payment in full of all amounts
due thereon before the Holders of the Subordinated Debt Securities will be
entitled to receive any payment upon the principal of or interest on the
Subordinated Debt Securities.
By reason of such subordination in favor of the holders of Senior
Indebtedness, in the event of insolvency, creditors of the Corporation who are
not holders of Senior Indebtedness or Holders of the Subordinated Debt
Securities may recover less, ratably, than the holders of Senior Indebtedness
and may recover more, ratably, than the Holders of the Subordinated Debt
Securities. By reason of the obligation of the Holders of Subordinated Debt
Securities (other than Existing Subordinated Indebtedness) to pay over any
Excess Proceeds to Entitled Persons in respect to Other Financial Obligations,
in the event of insolvency, holders of Existing Subordinated Indebtedness may
recover less, ratably, than Entitled Persons in respect of Other Financial
Obligations and may recover more, ratably, than the Holders of Subordinated Debt
Securities (other than Existing Subordinated Indebtedness).
Unless otherwise specified in the Prospectus Supplement relating to the
particular series of Subordinated Debt Securities offered thereby, "Existing
Subordinated Indebtedness" means Subordinated Debt Securities issued pursuant to
the Subordinated Indenture prior to November 15, 1992. (SECTION 101 of the
Subordinated Indenture).
Unless otherwise specified in the Prospectus Supplement relating to the
particular series of Subordinated Debt Securities offered thereby, "Other
Financial Obligations" means all obligations of the Corporation to make payment
pursuant to the terms of financial instruments, such as (i) securities contracts
and foreign currency exchange contracts, (ii) derivative instruments, such as
swap agreements (including interest rate and foreign exchange rate swap
agreements), cap agreements, floor agreements, collar agreements, interest rate
agreements, foreign exchange rate agreements, options, commodity futures
contracts, commodity option contracts, and (iii) in the case of both (i) and
(ii) above, similar financial instruments, other than (a) obligations on account
of Senior Indebtedness, and (b) obligations on account of indebtedness for money
borrowed ranking pari passu with or subordinate to the Subordinated Debt
Securities. Unless otherwise specified in the Prospectus Supplement relating to
the particular series of Subordinated Debt Securities offered thereby, "Entitled
Persons" means any person who is entitled to payment pursuant to the terms of
Other Financial Obligations.
19
<PAGE>
The Corporation's obligations under the Subordinated Debt Securities shall
rank PARI PASSU in right of payment with each other and with the Existing
Subordinated Indebtedness, subject (unless otherwise specified in the Prospectus
Supplement relating to the particular series of Subordinated Debt Securities
offered thereby) to the obligations of the Holders of Subordinated Debt
Securities (other than Existing Subordinated Indebtedness) to pay over any
Excess Proceeds to Entitled Persons in respect of Other Financial Obligations as
provided in the Subordinated Indenture.
The applicable Prospectus Supplement may further describe the provisions,
if any, applicable to the subordination of the Subordinated Debt Securities of a
particular series.
CONVERSION OR EXCHANGE
If and to the extent indicated in the applicable Prospectus Supplement, the
Subordinated Debt Securities of any series may be convertible or exchangeable
into other Debt Securities or Common Stock, Preferred Stock, Class A Preferred
or Depositary Shares. The specific terms on which Subordinated Debt Securities
of any series may be so converted or exchanged will be set forth in the
applicable Prospectus Supplement. Such terms may include provisions for
conversion or exchange, either mandatory, at the option of the Holder or at the
option of the Corporation, in which case the amount or number of Securities to
be received by the Holders of Subordinated Debt Securities would be calculated
as of a time and in the manner stated in the applicable Prospectus Supplement.
DEFAULTS
THE SENIOR INDENTURE
An Event of Default is defined in the Senior Indenture as, with respect to
Senior Debt Securities of any series issued thereunder: default in payment of
principal of or premium, if any, on any Senior Debt Security of that series at
maturity; default for 30 days in payment of interest of any Senior Debt Security
of that series; failure to deposit any sinking fund payment when due in respect
of that series; failure by the Corporation for 60 days after due notice in
performance of any other of the covenants or warranties in the Senior Indenture
(other than a covenant or warranty included in the Senior Indenture solely for
the benefit of a series of Senior Debt Securities other than that series);
failure to pay when due any indebtedness of the Corporation or, in the case of
any series of Senior Debt Securities issued on or after August 1, 1990, any
Major Subsidiary Bank, or, in the case of any series of Senior Debt Securities
issued before August 1, 1990, FUNB-NC, for borrowed money in excess of
$5,000,000, or acceleration of the maturity of any such indebtedness in excess
of such amount if acceleration results from a default under the instrument
giving rise to such indebtedness and is not annulled within 30 days after due
notice, unless in either case such default is contested in good faith by
appropriate proceedings; certain events of bankruptcy, insolvency or
reorganization of the Corporation or, in the case of any series of Senior Debt
Securities issued on or after August 1, 1990, any Major Subsidiary Bank, or, in
the case of any series of Senior Debt Securities issued before August 1, 1990,
FUNB-NC; and any other Event of Default provided with respect to Senior Debt
Securities of that series. (SECTION 501).
The Senior Indenture provides that, if any Event of Default with respect to
Senior Debt Securities of any series at the time Outstanding thereunder occurs
and is continuing, either the Senior Trustee or the Holders of not less than 25
percent in principal amount of the Outstanding Senior Debt Securities of that
series may declare the principal amount (or, if the Senior Debt Securities of
that series are Original Issue Discount Securities, such portion of the
principal amount as may be specified in the terms of that series) of all Senior
Debt Securities of that series to be due and payable immediately (provided that
no such declaration is required upon certain events of bankruptcy), but upon
certain conditions such declaration may be annulled and past defaults (except,
unless theretofore cured, a default in payment of principal of or premium, if
any, or interest on the Senior Debt Securities of that series and certain other
specified defaults) may be waived by the Holders of a majority in principal
amount of the Outstanding Senior Debt Securities of that series on behalf of the
Holders of all Senior Debt Securities of that series. (SECTIONS 502 and 513).
See the penultimate paragraph under " -- General" above. In the event of the
bankruptcy, insolvency or reorganization of the Corporation, the claims of
Holders of the Senior Debt Securities would be subject as to enforcement to the
broad equity power of a federal bankruptcy court, and to the determination by
that court of the nature of the rights of such Holders.
The Senior Indenture contains a provision entitling the Senior Trustee,
subject to the duty of the Senior Trustee upon the occurrence and continuation
of an Event of Default to act with the required standard of care, to be
indemnified by the Holders of any series of Outstanding Senior Debt Securities
thereunder before proceeding to exercise any right or power under the Senior
Indenture at the request of the Holders of such series of Senior Debt
Securities. (SECTION 603). The Senior Indenture provides that the Holders of a
majority in principal amount of Outstanding Senior Debt Securities thereunder of
any series
20
<PAGE>
may direct the time, method and place of conducting any proceeding for any
remedy available to the Senior Trustee, or exercising any trust or other power
conferred on the Senior Trustee, with respect to the Senior Debt Securities of
such series, provided that the Senior Trustee may decline to act if such
direction is contrary to law or the Senior Indenture or would involve the Senior
Trustee in personal liability. (SECTION 512).
The Corporation will file annually with the Senior Trustee a certificate as
to compliance with all conditions and covenants in the Senior Indenture.
(SECTION 1007).
THE SUBORDINATED INDENTURE
Payment of principal of the Subordinated Debt Securities may be accelerated
only upon an Event of Default. There is no right of acceleration in the case of
a default in the payment of interest or the payment of principal prior to the
date of maturity or a default in the performance of any other covenant of the
Corporation in the Subordinated Indenture, unless the terms of a particular
series of Subordinated Debt Securities specifically provide otherwise, in which
case any such extension of such right of acceleration will be described in the
applicable Prospectus Supplement.
An Event of Default is defined in the Subordinated Indenture as, with
respect to Subordinated Debt Securities of any series issued thereunder, certain
events involving the bankruptcy, insolvency or reorganization of the Corporation
and any other Event of Default which may be provided for with respect to the
Subordinated Debt Securities of that series. (SECTION 501). A Default, with
respect to Subordinated Debt Securities of that series, is defined in the
Subordinated Indenture to include: (i) any Event of Default; (ii) a default in
the payment of principal or premium, if any, of any Subordinated Debt Security
of that series at its maturity; (iii) default in the payment of any interest
when due, continued for 30 days; (iv) a default in any required designation of
funds as Available Funds; or (v) default in the performance, or breach, of any
other covenant of the Corporation in the Subordinated Indenture or in the
Subordinated Debt Securities of that series, continued for 90 days after written
notice to the Corporation by the Subordinated Trustee or to the Corporation and
the Subordinated Trustee by the Holders of not less than 25 percent in aggregate
principal amount of the Outstanding Subordinated Debt Securities of such series.
(SECTION 503). If an Event of Default with respect to the Subordinated Debt
Securities of any series occurs and is continuing, either the Subordinated
Trustee or the Holders of not less than 25 percent in aggregate principal amount
of the Outstanding Subordinated Debt Securities of that series may accelerate
the maturity of all Outstanding Subordinated Debt Securities of such series. The
Holders of a majority in aggregate principal amount of the Outstanding
Subordinated Debt Securities of that series may waive an Event of Default
resulting in acceleration of the Subordinated Debt Securities of such series,
but only if all Events of Default have been remedied and all payments due on the
Subordinated Debt Securities of that series (other than those due as a result of
acceleration) have been made and certain other conditions have been met.
(SECTION 502). Subject to the provisions of the Subordinated Indenture relating
to the duties of the Subordinated Trustee, in case a Default shall occur and be
continuing, the Subordinated Trustee will be under no obligation to exercise any
of its rights or powers under the Subordinated Indenture at the request or
direction of any of the Holders of the Outstanding Securities of that series,
unless such Holders shall have offered to the Subordinated Trustee reasonable
indemnity. (SECTION 603). Subject to such provisions for the indemnification of
the Subordinated Trustee, the Holders of a majority in aggregate principal
amount of the Outstanding Subordinated Debt Securities of that series will have
the right to direct the time, method and place of conducting any proceeding for
any remedy available to the Subordinated Trustee or exercising any trust or
power conferred on the Subordinated Trustee. (SECTION 512). The Holders of a
majority in aggregate principal amount of the Outstanding Subordinated Debt
Securities of that series may waive any past default under the Subordinated
Indenture with respect to such series, except a default in the payment of
principal or interest or a default in respect of a covenant in the Subordinated
Indenture which cannot be modified without the consent of the Holder of each
Outstanding Subordinated Debt Security of the series affected. (SECTION 513).
See the penultimate paragraph under " -- General" above. In the event of the
bankruptcy, insolvency or reorganization of the Corporation, the claims of the
Holders of Subordinated Debt Securities would be subject as to enforcement to
the broad equity power of a federal bankruptcy court, and to the determination
by that court of the nature of the rights of such Holders.
The Corporation will file annually with the Subordinated Trustee a
certificate as to compliance with all conditions and covenants in the
Subordinated Indenture. (SECTION 1007).
MODIFICATION AND WAIVER
Certain modifications and amendments of each of the Senior Indenture or the
Subordinated Indenture may be made by the Corporation and the Trustee under the
Applicable Indenture only with the consent of the Holders of not less than a
majority in aggregate principal amount of the Outstanding Debt Securities of
each series issued under such Indenture and affected by the modification or
amendment, provided that no such modification or amendment may, without the
consent of
21
<PAGE>
the Holder of each Outstanding Debt Security issued under such Indenture and
affected thereby: (i) change the Stated Maturity of the principal of, or any
installment of principal of or interest on, any such Outstanding Debt Security;
(ii) reduce the principal amount of, or the premium, if any, or the interest on,
any such Outstanding Debt Security (including in the case of an Original Issue
Discount Security the amount payable upon acceleration of the maturity thereof);
(iii) change the place of payment where, or the coin or currency or currency
unit in which, any principal of, or premium, if any, or interest on, any such
Outstanding Debt Security is payable; (iv) impair the right to institute suit
for the enforcement of any such payment on or after the Stated Maturity thereof
(or, in the case of redemption, on or after the Redemption Date); (v) reduce the
above-stated percentage of Outstanding Debt Securities of any series the consent
of the Holders of which is necessary to modify or amend the Applicable
Indenture; or (vi) modify the foregoing requirements or reduce the percentage of
aggregate principal amount of Outstanding Debt Securities of any series required
to be held by Holders seeking to waive compliance with certain provisions of the
Applicable Indenture or seeking to waive certain defaults. (SECTION 902).
The Holders of not less than a majority in aggregate principal amount of
the Outstanding Debt Securities of any series may on behalf of the Holders of
all Outstanding Debt Securities of that series waive, insofar as that series is
concerned, compliance by the Corporation with certain restrictive provisions of
the Applicable Indenture. (SECTION 1008). The Holders of not less than a
majority in aggregate principal amount of the Outstanding Debt Securities of any
series may on behalf of the Holders of all Outstanding Debt Securities of that
series waive any past default under the Applicable Indenture with respect to
that series, except a default in the payment of the principal of, or premium, if
any, or interest on any Outstanding Debt Security of that series or in respect
of a covenant or provision which under the Applicable Indenture cannot be
modified or amended without the consent of the Holder of each Outstanding Debt
Security issued thereunder of the series affected. (SECTION 513).
Certain modifications and amendments of each of the Senior Indenture and
the Subordinated Indenture may be made by the Corporation and the Trustee under
the Applicable Indenture without the consent of Holders of the Outstanding Debt
Securities issued under such Indenture. (SECTION 901).
Each Indenture provides that in determining whether the Holders of the
requisite principal amount of the Outstanding Debt Securities issued under such
Indenture have given any request, demand, authorization, direction, notice,
consent or waiver thereunder or are present at a meeting of Holders of
Outstanding Debt Securities for quorum purposes, (i) the principal amount of an
Original Issue Discount Security that shall be deemed to be Outstanding shall be
the amount of the principal thereof that would be due and payable as of the date
of such determination upon acceleration of the maturity thereof, and (ii) the
principal amount of Outstanding Debt Securities denominated in a foreign
currency or currency unit shall be the United States dollar equivalent,
determined on the date of original issuance of such Outstanding Debt Security,
of the principal amount of such Outstanding Debt Security or, in the case of an
Original Issue Discount Security, the United States dollar equivalent,
determined on the date of original issuance of such Outstanding Debt Security,
of the amount determined as provided in (i) above. (SECTION 101).
CONSOLIDATION, MERGER AND SALE OF ASSETS
The Indentures each provide that the Corporation may not consolidate with
or merge into any other corporation or transfer its properties and assets
substantially as an entirety to any Person unless (i) the corporation formed by
such consolidation or into which the Corporation is merged or the Person to
which the properties and assets of the Corporation are so transferred shall be a
corporation organized and existing under the laws of the United States, any
State thereof or Washington, D.C. and shall expressly assume by supplemental
indenture the payment of the principal of and premium, if any, and interest on
the Senior Debt Securities or the Subordinated Debt Securities, as the case may
be, and the performance of the other covenants of the Corporation under the
Applicable Indenture; (ii) immediately after giving effect to such transaction,
no Event of Default or Default, as applicable, and no event which, after notice
or lapse of time or both, would become an Event of Default or Default, as
applicable, shall have occurred and be continuing; and (iii) certain other
conditions are met. (SECTION 801).
LIMITATION ON DISPOSITION OF STOCK OF FUNB-NC
THE SENIOR INDENTURE
The Senior Indenture contains a covenant by the Corporation that, so long
as any of the Senior Debt Securities issued thereunder before August 1, 1990 are
outstanding, but subject to the rights of the Corporation in connection with its
consolidation with or merger into another corporation or a sale of the
Corporation's assets, it will not sell, assign, transfer, grant a
22
<PAGE>
security interest in or otherwise dispose of any shares of, securities
convertible into, or options, warrants or rights to subscribe for or purchase
shares of, Voting Stock of FUNB-NC, nor will it permit FUNB-NC to issue (other
than to the Corporation) any shares (other than directors' qualifying shares)
of, or securities convertible into, or options, warrants or rights to subscribe
for or purchase shares of, Voting Stock of FUNB-NC, unless (i) any such sale,
assignment, transfer, issuance, grant of a security interest or other
disposition is made for fair market value, as determined by the Board of
Directors of the Corporation, and (ii) the Corporation will own at least 80
percent of the issued and outstanding Voting Stock of FUNB-NC (or any successor
to FUNB-NC) free and clear of any security interest after giving effect to such
transaction. (SECTION 1006).
The foregoing covenant is not a covenant for the benefit of any series of
Senior Debt Securities issued on or after August 1, 1990.
THE SUBORDINATED INDENTURE
The Subordinated Indenture contains a covenant by the Corporation that, so
long as any of the Subordinated Debt Securities issued thereunder before August
1, 1990 are outstanding, but subject to the rights of the Corporation in
connection with its consolidation with or merger into another corporation or a
sale of the Corporation's assets, it will not sell, assign, transfer, grant a
security interest in or otherwise dispose of any shares of, securities
convertible into, or options, warrants or rights to subscribe for or purchase
shares of, Voting Stock of FUNB-NC (other than to a Wholly-Owned Subsidiary),
nor will it permit FUNB-NC to issue (other than to the Corporation or to a
Wholly-Owned Subsidiary) any shares (other than directors' qualifying shares)
of, or securities convertible into, or options, warrants or rights to subscribe
for or purchase shares of, Voting Stock of FUNB-NC, unless (i) any such sale,
assignment, transfer, issuance, grant of a security interest or other
disposition is made for fair market value, as determined by the Board of
Directors of the Corporation, and (ii) the Corporation and/or its Wholly-Owned
Subsidiaries will own at least 80 percent of the issued and outstanding Voting
Stock of FUNB-NC (or any successor to FUNB-NC) free and clear of any security
interest after giving effect to such transaction. (SECTION 1006).
The foregoing covenant is not a covenant for the benefit of any series of
Subordinated Debt Securities issued on or after August 1, 1990.
RESTRICTION ON SALE OR ISSUANCE OF VOTING STOCK OF MAJOR SUBSIDIARY BANKS
The Indentures each contain a covenant by the Corporation that it will not,
and will not permit any Subsidiary to, sell, assign, transfer, grant a security
interest in, or otherwise dispose of, any shares of Voting Stock, or any
securities convertible into shares of Voting Stock, of any Major Subsidiary Bank
or any Subsidiary owning, directly or indirectly, any shares of Voting Stock of
any Major Subsidiary Bank and that it will not permit any Major Subsidiary Bank
or any Subsidiary owning, directly or indirectly, any shares of Voting Stock of
a Major Subsidiary Bank to issue any shares of its Voting Stock or any
securities convertible into shares of its Voting Stock, except for sales,
assignments, transfers or other dispositions which: (i) are for the purpose of
qualifying a Person to serve as a director; (ii) are for fair market value (as
determined by the Board of Directors of the Corporation) and, after giving
effect to such dispositions and to any potential dilution, the Corporation will
own not less than 80 percent of the shares of Voting Stock of such Major
Subsidiary Bank or any such Subsidiary owning any shares of Voting Stock of such
Major Subsidiary Bank; (iii) are made (x) in compliance with an order of a court
or regulatory authority of competent jurisdiction, or (y) in compliance with a
condition imposed by any such court or authority permitting the acquisition by
the Corporation, directly or indirectly, of any other Bank or entity the
activities of which are legally permissible for a Person such as the Corporation
or a Subsidiary to engage in, or (z) in compliance with an undertaking made to
such authority in connection with such an acquisition (provided that, in the
case of clauses (y) and (z), the assets of the Bank or entity being acquired and
its consolidated subsidiaries equal or exceed 75 percent of the assets of such
Major Subsidiary Bank or such Subsidiary owning, directly or indirectly, any
shares of Voting Stock of a Major Subsidiary Bank and its respective
consolidated subsidiaries on the date of acquisition); or (iv) are made to the
Corporation or any Wholly-Owned Subsidiary. Notwithstanding the foregoing, any
Major Subsidiary Bank may be merged into or consolidated with another banking
institution organized under the laws of the United States, any State thereof or
Washington D.C., if after giving effect to such merger or consolidation the
Corporation or any Wholly-Owned Subsidiary owns at least 80 percent of the
Voting Stock of such other banking institution then issued and outstanding free
and clear of any security interest and if, immediately after giving effect
thereto, 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. (SECTION 1007). A Major Subsidiary Bank is defined in each Indenture
to mean any Subsidiary which is a bank and has total assets equal to 25 percent
or more of the consolidated assets of the Corporation determined as of the date
of the most recent audited financial statements of such entities. At present,
the only Major Subsidiary Banks are FUNB-NC and First Union National Bank based
in Avondale, Pennsylvania.
23
<PAGE>
The foregoing covenant is not a covenant for the benefit of any series of
Debt Securities issued before August 1, 1990, or, in the case of Subordinated
Debt Securities, issued after November 15, 1992.
TRUSTEES
Either or both of the Trustees may resign or be removed with respect to one
or more series of Debt Securities and a successor Trustee may be appointed to
act with respect to such series. (SECTION 610). In the event that two or more
persons are acting as Trustee with respect to different series of Debt
Securities, each such Trustee shall be a Trustee of a trust under the Applicable
Indenture separate and apart from the trust administered by any other such
Trustee (SECTION 611), and any action described herein to be taken by the
"Trustee" may then be taken by each such Trustee with respect to, and only with
respect to, the one or more series of Debt Securities for which it is Trustee.
In the normal course of business, the Corporation and its subsidiaries
conduct banking transactions with the Trustees, and the Trustees conduct banking
transactions with the Corporation and its subsidiaries.
TITLE
The Corporation, the Trustees and any agent of the Corporation or the
applicable Trustee may treat the registered owner of any Debt Security as the
absolute owner thereof (whether or not such Debt Security shall be overdue and
notwithstanding any notice to the contrary) for the purpose of making payment
and for all other purposes. See "Global Securities".
DESCRIPTION OF WARRANTS
The following summary of each Warrant Agreement (as defined below), the
Warrants and the Warrant Certificates (as defined below) does not purport to be
complete and is qualified in its entirety by reference to the Warrant Agreement
with respect to the Warrants of any particular series, which are or will be
incorporated by reference as exhibits to the Registration Statement of which
this Prospectus is a part in connection with the issuance of such Warrants. Such
summary relates to certain terms and conditions applicable to the Warrants
generally. The particular terms of any series of Warrants will be described in
the applicable Prospectus Supplement. If so indicated in such Prospectus
Supplement, the terms of any such series may differ from the terms set forth
below.
GENERAL
The Corporation may issue Warrants for the purchase of Debt Securities,
Preferred Stock, Class A Preferred Stock, Depositary Shares or Common Stock.
Warrants may be issued independently or together with Debt Securities, Preferred
Stock, Class A Preferred Stock, Depositary Shares or Common Stock, and may be
attached to or separate from such Securities.
Each series of Warrants will be evidenced by certificates (the "Warrant
Certificates") issued pursuant to a separate Warrant Agreement to be entered
into between the Corporation and a bank (the "Warrant Agent") selected by the
Corporation with respect to such series, having its principal office in the
United States and having combined capital and surplus of at least $50,000,000
(with respect to such series, the "Warrant Agreement").
The applicable Prospectus Supplement relating to a series of Warrants will
set forth the name and address of the Warrant Agent. The applicable Prospectus
Supplement will describe the terms of the series of Warrants in respect of which
this Prospectus is being delivered, including: (i) the offering price; (ii) the
currency for which such Warrants may be purchased; (iii) if applicable, the
designation and terms of the Securities with which the Warrants are issued and
the number of Warrants issued with each such Security or each principal amount
of such Security; (iv) if applicable, the date on and after which the Warrants
and the related Securities will be separately transferable; (v) in the case of
Warrants to purchase Debt Securities, the principal amount of Debt Securities
purchasable upon exercise of one Warrant and the price at and currency in which
such principal amount of Debt Securities may be purchased upon such exercise
and, in the case of Warrants to purchase Preferred Stock, Class A Preferred
Stock, Depositary Shares or Common Stock, the number of Depositary Shares or
shares of Preferred Stock, Class A Preferred Stock or Common Stock, as the case
may be, purchasable upon the exercise of one Warrant and the price at which such
shares may be purchased upon such exercise; (vi) the date or dates on which the
right to exercise the Warrants will commence and the date or dates on which such
right will expire (the "Expiration Date"); (vii) certain federal income tax
consequences of holding or exercising such Warrants; (viii) the terms of the
Securities issuable upon exercise of such Warrants; and (ix) any other terms of
the Warrants.
24
<PAGE>
Warrant Certificates may be exchanged for new Warrant Certificates of
different denominations, may be presented for registration of transfer, and may
be exercised at the corporate trust office of the Warrant Agent or any other
office indicated in the applicable Prospectus Supplement. If the Warrants are
not separately transferrable from the Securities with which they were issued,
such exchange may take place only in connection with an exchange of the
certificates representing such related Securities. Prior to the exercise of
their Warrants, holders of Warrants will not have any of the rights of holders
of the Securities purchasable upon such exercise, including, in the case of
Warrants to purchase Debt Securities, the right to receive payments of principal
of, premium, if any, or interest, if any, on the Debt Securities purchasable
upon such exercise or to enforce covenants in the applicable Indenture or, in
the case of Warrants to purchase Preferred Stock, Class A Preferred Stock,
Depositary Shares or Common Stock, the right to receive dividends, if any, or
payments upon the liquidation, dissolution or winding up of the Corporation or
to exercise voting rights, if any.
EXERCISE OF WARRANTS
Each Warrant will entitle the holder to purchase the Securities specified
in the applicable Prospectus Supplement at the exercise price set forth in, or
calculated as described in, the applicable Prospectus Supplement. Unless
otherwise specified in the applicable Prospectus Supplement, Warrants may be
exercised at any time up to 5:00 p.m., New York time, on the Expiration Date set
forth in such Prospectus Supplement. After the close of business on the
Expiration Date, unexercised Warrants will become void.
Warrants may be exercised by delivery of the Warrant Certificate
representing the Warrants to be exercised, or in the case of Global Securities
(as defined in "Global Securities"), by delivery of a notice of exercise with
respect to such Warrants, together with certain information, and payment to the
Warrant Agent in immediately available funds, as provided in the applicable
Prospectus Supplement, of the amount required to purchase the Securities
purchasable upon such exercise. The information required to be delivered will be
set forth on the reverse side of the Warrant Certificate and in the applicable
Prospectus Supplement. Upon receipt of such payment and the Warrant Certificate
or notice of exercise properly completed and duly executed at the corporate
trust office of the Warrant Agent or any other office indicated in the
applicable Prospectus Supplement, the Corporation will, in the time period
provided by the applicable Warrant Agreement, issue and deliver the Securities
purchasable upon such exercise. If fewer than all of the Warrants represented by
such Warrant Certificate are exercised, a new Warrant Certificate will be issued
for the remaining amount of Warrants.
If so indicated in the applicable Prospectus Supplement, Securities may be
surrendered as all or part of the exercise price for Warrants.
ANTIDILUTION PROVISIONS
In the case of Warrants to purchase Common Stock, the exercise price
payable and the number of shares of Common Stock purchasable upon the exercise
of each Warrant will be subject to adjustment in certain events, including (i)
the issuance of a stock dividend to holders of Common Stock or a combination,
subdivision or reclassification of Common Stock; (ii) the issuance of rights,
warrants or options to all holders of the Common Stock entitling the holders
thereof to purchase Common Stock for an aggregate consideration per share less
than the current market price per share of Common Stock; (iii) any distribution
by the Corporation to the holders of its Common Stock of evidences of
indebtedness of the Corporation or of assets (excluding cash dividends or
distributions referred to in (i) above); and (iv) any other events set forth in
the applicable Prospectus Supplement. No adjustment in the number of shares
purchasable upon exercise of the Warrants will be required until cumulative
adjustments require an adjustment of at least one percent of such number. No
fractional shares will be issued upon exercise of Warrants, but the Corporation
will pay the cash value of any fractional shares otherwise issuable.
MODIFICATION
Any Warrant Agreement and the terms of the related Warrants may be amended
by the Corporation and the applicable Warrant Agent by executing a supplemental
warrant agreement (a "Supplemental Agreement"), without the consent of the
holders of any such Warrants, for the purpose of (i) curing any ambiguity, or
curing, correcting or supplementing any defective or inconsistent provision
contained therein, or making any other provisions with respect to matters or
questions arising under the Warrant Agreement that are not inconsistent with the
provisions of the Warrant Agreement or the Warrant Certificates; (ii) evidencing
the succession of another corporation to the Corporation and the assumption by
any such successor of the covenants of the Corporation contained in such Warrant
Agreement and the Warrants; (iii) appointing a successor depository, if the
Warrants are issued in the form of Global Securities; (iv) evidencing and
providing for the acceptance of appointment by a successor Warrant Agent with
respect to the Warrants; (v) adding to the covenants of the Corporation for the
benefit of the holders of such Warrants or surrendering any right or power
conferred upon the Corporation under the Warrant
25
<PAGE>
Agreement; (vi) issuing Warrants in definitive form, if such Warrants are
initially issued in the form of Global Securities; or (vii) amending the Warrant
Agreement and the Warrants in any manner that the Corporation may deem to be
necessary or desirable and that will not adversely affect the interests of the
holders of such Warrants in any material respect.
The Corporation and the Warrant Agent may also amend any Warrant Agreement
and the terms of the related Warrants by executing a Supplemental Agreement with
the consent of the holders of a majority in number of the unexercised Warrants
affected by such amendment, for the purpose of adding any provisions to or
modifying in any manner or eliminating any of the provisions of such Warrant
Agreement or of modifying in any manner the rights of the holders of such
Warrants, except that no such amendment that (i) changes the number or amount of
Securities purchasable upon exercise of such Warrants so as to reduce the number
or amount of Securities receivable upon such exercise, (ii) shortens the period
of time during which the Warrants may be exercised, (iii) otherwise adversely
affects the exercise rights of the holders of such Warrants in any material
respect, or (iv) reduces the number of unexercised Warrants the consent of
holders of which is required for amendment of the Warrant Agreement or the
related Warrants, may be made without the consent of each holder affected
thereby.
CONSOLIDATION, MERGER AND SALE OF ASSETS
Each Warrant Agreement will provide that the Corporation may consolidate or
merge with or into any other corporation or sell, lease, transfer or convey all
or substantially all of its assets to any other corporation, provided that (i)
either the Corporation must be the continuing corporation, or the corporation
(if other than the Corporation) that is formed by or results from any such
consolidation or merger or that receives such assets must be a corporation
organized and existing under the laws of the United States or a State thereof
and must assume the obligations of the Corporation with respect to all the
unexercised Warrants and the performance and observance of all of the covenants
and conditions of the applicable Warrant Agreement to be performed or observed
by the Corporation, and (ii) the Corporation or such successor corporation, as
the case may be, must not immediately be in default under such Warrant
Agreement.
ENFORCEABILITY OF RIGHTS BY HOLDERS OF WARRANTS
Each Warrant Agent will act solely as the agent of the Corporation under
the applicable Warrant Agreement and will not assume any obligation or
relationship of agency or trust for or with any holder of any Warrant. A single
bank or trust company may act as Warrant Agent for more than one issue of
Warrants. A Warrant Agent will have no duty or responsibility in case of any
default by the Corporation in the performance of its obligations under the
applicable Warrant Agreement or Warrant, including, without limitation, any duty
or responsibility to initiate any proceedings at law or otherwise or to make any
demand upon the Corporation. Any holder of a Warrant may, without the consent of
the related Warrant Agent or the holder of any other Warrant, enforce by
appropriate legal action, in and for its own behalf, its right to exercise, and
receive the Securities purchasable upon exercise of, such Warrant.
REPLACEMENT OF WARRANT CERTIFICATES
Any destroyed, lost, stolen or mutilated Warrant Certificate will be
replaced by the Corporation upon delivery to the Corporation and the applicable
Warrant Agent of evidence satisfactory to them of the ownership of such Warrant
Certificate and of the destruction, loss, theft or mutilation of such Warrant
Certificate, and (in the case of mutilation) surrender of such Warrant
Certificate to the applicable Warrant Agent, unless the Corporation or the
Warrant Agent has received notice that such Warrant Certificate has been
acquired by a bona fide purchaser. The holder of such Warrant will also be
required to provide indemnity satisfactory to the relevant Warrant Agent and the
Corporation before a replacement Warrant Certificate will be issued.
TITLE
The Corporation, the Warrant Agents and any agent of the Corporation or the
applicable Warrant Agent may treat the registered holder of any Warrant
Certificate as the absolute owner of the Warrants evidenced thereby
(notwithstanding any notice to the contrary) for any purpose and as the person
entitled to exercise the rights attaching to the Warrants requested thereby, any
notice to the contrary notwithstanding. See "Global Securities".
GLOBAL SECURITIES
Unless otherwise specified in the applicable Prospectus Supplement,
Securities other than Common Stock will be issued in the form of one or more
global certificates (collectively, with respect to each series or issue of
Securities, the "Global Security") registered in the name of a depositary or a
nominee of a depositary. Unless otherwise specified in the applicable
26
<PAGE>
Prospectus Supplement, the depositary will be The Depository Trust Company
("DTC"). The Corporation has been informed by DTC that its nominee will be Cede
& Co. ("Cede"). Accordingly, Cede is expected to be the initial registered
holder of all Securities that are issued in global form. No person that acquires
a beneficial interest in such Securities will be entitled to receive a
certificate representing such person's interest in the Securities except as set
forth herein or in the applicable Prospectus Supplement. Unless and until
definitive Securities are issued under the limited circumstances described
below, all references to actions by holders of Securities issued in global form
shall refer to actions taken by DTC upon instructions from its Participants (as
defined below), and all references herein to payments and notices to holders
shall refer to payments and notices to DTC or Cede, as the registered holder of
such Securities.
DTC has informed the Corporation that it is a limited purpose trust company
organized under the New York Banking Law, a "banking organization" within the
meaning of the New York Banking Law, a member of the Federal Reserve System, a
"clearing corporation" within the meaning of the New York Uniform Commercial
Code, and a "clearing agency" registered pursuant to Section 17A of the Exchange
Act, and that it was created to hold securities for its participating
organizations ("Participants") and to facilitate the clearance and settlement of
securities transactions among Participants through electronic book-entry,
thereby eliminating the need for physical movement of certificates. Participants
include securities brokers and dealers, banks, trust companies and clearing
corporations, and may include certain other organizations. Indirect access to
the DTC system also is available to others such as banks, brokers, dealers and
trust companies that clear through or maintain a custodial relationship with a
Participant, either directly or indirectly ("Indirect Participants").
Persons that are not Participants or Indirect Participants but desire to
purchase, sell or otherwise transfer ownership of, or other interests in,
Securities may do so only through Participants and Indirect Participants. Under
a book-entry format, holders may experience some delay in their receipt of
payments, as such payments will be forwarded by the agent designated by the
Corporation to Cede, as nominee for DTC. DTC will forward such payments to its
Participants, which thereafter will forward them to Indirect Participants or
holders. Holders will not be recognized by the applicable registrar, transfer
agent, Trustee, Depositary or Warrant Agent as registered holders of the
Securities entitled to the benefits of the Articles or the applicable Indenture,
Deposit Agreement or Warrant Agreement. Beneficial owners that are not
Participants will be permitted to exercise their rights as such only indirectly
through and subject to the procedures of Participants and, if applicable,
Indirect Participants.
Under the rules, regulations and procedures creating and affecting DTC and
its operations as currently in effect (the "Rules"), DTC will be required to
make book-entry transfers of Securities among Participants and to receive and
transmit payments to Participants. Participants, as well as Indirect
Participants, with which beneficial owners of Securities have accounts with
respect to the Securities similarly are required by the Rules to make book-entry
transfers and receive and transmit such payments on behalf of their respective
account holders.
Because DTC can act only on behalf of (i) Participants, who in turn act
only on behalf of Participants or Indirect Participants, and (ii) certain banks,
trust companies and other persons approved by it, the ability of a beneficial
owner of Securities issued in global form to pledge such Securities to persons
or entities that do not participate in the DTC system, or to otherwise act with
respect to such Securities, may be limited due to the unavailability of physical
certificates for such Securities.
DTC has advised the Corporation that DTC will take any action permitted to
be taken by a registered holder of any Securities under the Articles or the
applicable Indenture, Deposit Agreement or Warrant Agreement only at the
direction of one or more Participants to whose accounts with DTC such Securities
are credited.
Unless otherwise specified in the applicable Prospectus Supplement, a
Global Security will be exchangeable for the relevant definitive Securities
registered in the names of persons other than DTC or its nominee only if (i) DTC
notifies the Corporation that it is unwilling or unable to continue as
depositary for such Global Security or if at any time DTC ceases to be a
clearing agency registered under the Exchange Act at a time when DTC is required
to be so registered in order to act as such depositary, (ii) the Corporation
executes and delivers to the applicable registrar, transfer agent, Trustee,
Depositary and/or Warrant Agent an order complying with the requirements of the
Articles or the applicable Indenture, Deposit Agreement and/or Warrant Agreement
that such Global Security shall be so exchangeable, or (iii) there has occurred
and is continuing a default in the payment of any amount due in respect of the
Securities or, in the case of Debt Securities, an event of default or an event
that, with the giving of notice or lapse of time, or both, would constitute an
event of default with respect to such Debt Securities. Any Global Security that
is exchangeable pursuant to the preceding sentence will be exchangeable for
Securities registered in such names as DTC directs.
27
<PAGE>
Upon the occurrence of any event described in the immediately preceding
paragraph, DTC is generally required to notify all Participants of the
availability through DTC of definitive Securities. Upon surrender by DTC of the
Global Security representing the Securities and delivery of instructions for
re-registration, the registrar, transfer agent, Trustee, Depositary or Warrant
Agent, as the case may be, will reissue the Securities as definitive Securities,
and thereafter such persons will recognize the holders of such definitive
Securities as registered holders of Securities entitled to the benefits of the
Articles or the applicable Indenture, Deposit Agreement and/or Warrant
Agreement.
Except as described above, the Global Security may not be transferred
except as a whole by DTC to a nominee of DTC or by a nominee of DTC to DTC or
another nominee of DTC or to a successor depositary appointed by the
Corporation. Except as described above, DTC may not sell, assign, transfer or
otherwise convey any beneficial interest in a Global Security evidencing all or
part of any Securities unless such beneficial interest is in an amount equal to
an authorized denomination for such Securities.
None of the Corporation, the Trustees, any registrar and transfer agent,
any Warrant Agent or any Depositary, or any agent of any of them, will have any
responsibility or liability for any aspect of DTC's or any Participant's records
relating to, or for payments made on account of, beneficial interests in a
Global Security, or for maintaining, supervising or reviewing any records
relating to such beneficial interests.
Secondary trading in notes and debentures of corporate issuers is generally
settled in clearing-house or next-day funds. In contrast, beneficial interests
in a Global Security, in some cases, may trade in the Depositary's same-day
funds settlement system, in which secondary market trading activity in those
beneficial interests would be required by DTC to settle in immediately available
funds. There is no assurance as to the effect, if any, that settlement in
immediately available funds would have on trading activity in such beneficial
interests. Also, settlement for purchases of beneficial interests in a Global
Security upon the original issuance thereof may be required to be made in
immediately available funds.
PLAN OF DISTRIBUTION
The Corporation may sell Securities to or through underwriters, including
First Union Capital Markets Corp., to be designated from time to time, and also
may sell Securities directly to other purchasers or through agents. The
distribution of Securities may be effected from time to time in one or more
transactions at a fixed price or prices, which may be changed, or at market
prices prevailing at the time of sale, at prices related to such prevailing
market prices or at negotiated prices.
The Debt Securities, Preferred Stock, Class A Preferred Stock, Depositary
Shares and Warrants will be new issues of securities with no established trading
market. It has not presently been established whether the underwriters, if any,
of such Securities will make a market in such Securities. If a market in such
Securities is made by any such underwriters, such market making may be
discontinued at any time without notice. No assurance can be given as to the
liquidity of the trading market for any such Securities.
This Prospectus and the related Prospectus Supplement may be used by First
Union Capital Markets Corp. in connection with offers and sales related to
market-making transactions in the Securities. First Union Capital Markets Corp.
may act as principal or agent in such transactions. Such sales will be made at
prices related to prevailing market prices at the time of sale or otherwise.
In connection with the sale of Securities, underwriters may receive
compensation from the Corporation or from purchasers of Securities for whom they
may act as agents in the form of discounts, concessions or commissions.
Underwriters may sell Securities to or through dealers, and such dealers may
receive compensation in the form of discounts, concessions or commissions from
the underwriters and/or commissions from the purchasers for whom they may act as
agents. Underwriters, dealers and agents that participate in the distribution of
Securities may be deemed to be underwriters, and any discounts or commissions
received by them from the Corporation and any profit on the resale of Securities
by them may be deemed to be underwriting discounts and commissions under the
Securities Act. Any such underwriter or agent will be identified, and any such
compensation received from the Corporation will be described, in the Prospectus
Supplement relating to such Securities.
Unless otherwise indicated in the applicable Prospectus Supplement, the
obligations of any such underwriters to purchase the Securities will be subject
to certain conditions precedent, and each of the underwriters with respect to a
sale of Securities will be obligated to purchase all of its Securities if any
are purchased. Unless otherwise indicated in the applicable Prospectus
Supplement, any such agent involved in the offer and sale of the Securities in
respect of which this Prospectus is being delivered will be acting on a best
efforts basis for the period of its appointment.
28
<PAGE>
In connection with an offering of Securities, underwriters may purchase and
sell such Securities in the open market. These transactions may include
over-allotment and stabilizing transactions and purchases to cover short
positions created by underwriters in connection with the offering. Stabilizing
transactions consist of certain bids or purchases for the purpose of preventing
or retarding a decline in the market price of the securities; and short
positions created by underwriters involve the sale by underwriters of a greater
number of Securities than they are required to purchase from the Corporation in
the offering. Underwriters also may impose a penalty bid, whereby selling
concessions allowed to broker-dealers in respect of the Securities sold in the
offering may be reclaimed by underwriters if such Securities are repurchased by
underwriters in stabilizing or covering transactions. These activities may
stabilize, maintain or otherwise affect the market price of the Securities,
which may be higher than the price that might otherwise prevail in the open
market; and these activities, if commenced, may be discontinued at any time.
These transactions may be effected on the NYSE, in the over-the-counter market
or otherwise.
Under agreements which may be entered into by the Corporation,
underwriters, agents and their controlling persons who participate in the
distribution of Securities may be entitled to indemnification by the Corporation
against certain liabilities, including liabilities under the Securities Act.
If so indicated in the Prospectus Supplement relating to any Securities,
the Corporation will authorize dealers or other persons acting as the
Corporation's agents to solicit offers by certain institutions to purchase any
Securities from the Corporation pursuant to contracts providing for payment and
delivery on a future date. Institutions with which such contracts may be made
include commercial and savings banks, insurance companies, pension funds,
investment companies, educational and charitable institutions and others, but in
all cases such institutions must be approved by the Corporation. The obligations
of any purchaser under any such contract will be subject to the condition that
the purchase of any Securities shall not at the time of delivery be prohibited
under the laws of the jurisdiction to which such purchaser is subject. The
underwriters and such other agents will not have any responsibility in respect
of the validity or performance of such contracts.
The participation of First Union Capital Markets Corp. in the offer and
sale of the Securities must comply with the requirements of Schedule E to the
Bylaws of the National Association of Securities Dealers, Inc. (the "NASD"). In
such circumstances, no NASD member participating in offers and sales will
execute a transaction in the Securities in a discretionary account without the
prior specific written approval of such member's customer.
If the Corporation offers and sells Securities directly to a purchaser or
purchasers in respect of which this Prospectus is delivered, purchasers involved
in the reoffer or resale of such Securities, if such purchasers in respect
thereof may be deemed to be underwriters as that term is defined in the
Securities Act, will be named and the terms of such reoffers or resales will be
set forth in the applicable Prospectus Supplement. Such purchasers may then
reoffer and resell such Securities to the public or otherwise at varying prices
to be determined by such purchasers at the time of resale or as otherwise
described in the applicable Prospectus Supplement. Purchasers of Securities
directly from the Corporation may be entitled under agreements that they may
enter into with the Corporation to indemnification by the Corporation against
certain liabilities, including liabilities under the Securities Act, and may
engage in transactions with or perform services for the Corporation in the
ordinary course of their business or otherwise.
Underwriters or agents and their associates may be customers of (including
borrowers from), engage in transactions with, and/or perform services for, the
Corporation and its subsidiaries, the Senior Trustee and the Subordinated
Trustee, in the ordinary course of business.
VALIDITY OF SECURITIES
The validity of any Securities will be passed upon for the Corporation by
Marion A. Cowell, Jr., Esq., Executive Vice President, Secretary and General
Counsel of the Corporation, and for any underwriters or agents by Sullivan &
Cromwell, 125 Broad Street, New York, New York. Sullivan & Cromwell will rely
upon the opinion of Mr. Cowell as to matters of North Carolina law, and Mr.
Cowell will rely upon the opinion of Sullivan & Cromwell as to matters of New
York law. Mr. Cowell owns shares of Common Stock and holds options to purchase
additional shares of Common Stock. Sullivan & Cromwell regularly performs legal
services for the Corporation and its subsidiaries. Certain members of Sullivan &
Cromwell performing these legal services own shares of Common Stock.
29
<PAGE>
EXPERTS
The consolidated balance sheets of the Corporation as of December 31, 1996
and 1995, and the related consolidated statements of income, changes in
stockholders' equity and cash flows for each of the years in the three-year
period ended December 31, 1996, included in the Corporation's 1996 Annual Report
to Stockholders which is incorporated by reference in the Corporation's 1996
Annual Report on Form 10-K and incorporated by reference herein, have been
incorporated by reference herein in reliance upon the report of KPMG Peat
Marwick LLP, independent certified public accountants, incorporated by reference
herein, and upon the authority of said firm as experts in accounting and
auditing.
30
<PAGE>
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
<TABLE>
<S> <C>
Registration Statement filing fee....................................................... $ 606,061
Trustees', Registrar and Transfer Agents', Depositaries' and Warrant Agents' fees
and expenses............................................................................ 150,000*
Legal fees and expenses................................................................. 50,000*
Blue Sky fees and expenses.............................................................. 40,000*
Accounting fees and expenses............................................................ 15,000*
Listing fees and expenses............................................................... 125,000*
Rating agency fees...................................................................... 250,000*
Printing and engraving costs............................................................ 200,000*
Miscellaneous........................................................................... 28,939*
Total.............................................................................. $1,465,000*
</TABLE>
* Estimated
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Sections 55-8-50 through 55-8-58 of the North Carolina Business Corporation
Act (the "NCBCA") contain specific provisions relating to indemnification of
directors and officers of North Carolina corporations. In general, the statute
provides that (i) a corporation must indemnify a director or officer against
reasonable expenses who is wholly successful in his defense of a proceeding to
which he is a party because of his status as such, unless limited by the
articles of incorporation, and (ii) a corporation may indemnify a director or
officer if he is not wholly successful in such defense, if it is determined as
provided in the statute that the director or officer meets a certain standard of
conduct, provided when a director or officer is liable to the corporation or
liable on the basis of receiving a personal benefit, the corporation may not
indemnify him. The statute also permits a director or officer of a corporation
who is a party to a proceeding to apply to the courts for indemnification,
unless the articles of incorporation provide otherwise, and the court may order
indemnification under certain circumstances set forth in the statute. The
statute further provides that a corporation may in its articles of incorporation
or bylaws or by contract or resolution provide indemnification in addition to
that provided by the statute, subject to certain conditions set forth in the
statute.
The Corporation's Bylaws provide for the indemnification of the
Corporation's directors and executive officers by the Corporation against
liabilities arising out of his status as such, excluding any liability relating
to activities which were at the time taken known or believed by such person to
be clearly in conflict with the best interests of the Corporation. The
Corporation's Articles of Incorporation provide for the elimination of the
personal liability of each director of the Corporation to the fullest extent
permitted by the provisions of the NCBCA, as the same may from time to time be
in effect.
The Corporation maintains directors and officers liability insurance. In
general, the policy insures (i) the Corporation's directors and officers against
loss by reason of any of their wrongful acts, and/or (ii) the Corporation
against loss arising from claims against the directors and officers by reason of
their wrongful acts, all subject to the terms and conditions contained in the
policy.
Under agreements which may be entered into by the Corporation, certain
controlling persons, directors and officers of the Corporation may be entitled
to indemnification by underwriters and agents who participate in the
distribution of Securities covered by the Registration Statement against certain
liabilities, including liabilities under the Securities Act.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Corporation pursuant to the foregoing provisions or otherwise (other than
insurance), the Corporation 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 insurance or the
payment by the Corporation of expenses incurred or paid by a director, officer
or controlling person of the Corporation 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, the Corporation will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question of
II-1
<PAGE>
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.
ITEM 16. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT NO. EXHIBIT
<S> <C>
(1)(a) Form of Underwriting Agreement for Common Stock, Preferred Stock, Class A Preferred Stock, Depositary
Shares and Warrants.
(1)(b) Form of Underwriting Agreement for Debt Securities.
(2) Agreement and Plan of Mergers, dated as of July 18, 1997, among the Corporation, FUNB-NC, Signet and
Signet Bank. (Incorporated by reference to Exhibit (2) to the Corporation's Current Report on Form 8-K
dated July 21, 1997.)
(4)(a) Articles of Incorporation of the Corporation, as amended. (Incorporated by reference to Exhibit (4) to the
Corporation's 1990 First Quarter Report on Form 10-Q, to Exhibit (99)(a) to the Corporation's 1993 First
Quarter Report on Form 10-Q and to Exhibit (4)(a) to the Corporation's Current Report on Form 8-K dated
January 10, 1996.)
(4)(b) By-laws of the Corporation, as amended. (Incorporated by reference to Exhibit (3)(b) to the Corporation's
1995 Annual Report on Form 10-K.)
(4)(c) Amended and Restated Shareholder Protection Rights Agreement. (Incorporated by reference to Exhibit (4) to
the Corporation's Current Report on Form 8-K dated October 16, 1996.)
(4)(d) Form of Deposit Agreement.
(4)(e) Specimen Depositary Receipt. (Filed by reference to Exhibit A to Exhibit (4)(d).)
(4)(f) Senior Indenture (including form of Senior Debt Security). (Incorporated by reference to Exhibit (4) to
the Corporation's Registration Statement No. 2-98213.)
(4)(g) Supplemental Indenture, dated as of May 17, 1986, between the Corporation and Chemical Bank, as Trustee.
(Incorporated by reference to Exhibit (4)(a) (ii) to Amendment No. 1 to the Corporation's Registration
Statement No. 33-30122.)
(4)(h) Supplemental Indenture, dated as of July 1, 1988, between the Corporation and Chemical Bank, as Trustee.
(Incorporated by reference to Exhibit (4)(a) (iii) to Amendment No. 1 to the Corporation's Registration
Statement No. 33-30122.)
(4)(i) Supplemental Indenture, dated as of August 1, 1990, between the Corporation and Chemical Bank, as Trustee.
(Incorporated by reference to Exhibit (4)(a) (iv) to the Corporation's Registration Statement No.
33-40456.)
(4)(j) Subordinated Indenture (including form of Subordinated Debt Security). (Incorporated by reference to
Exhibit (4)(a) to Amendment No. 1 to the Corporation's Registration Statement No. 33-1852.)
(4)(k) Supplemental Indenture, dated as of August 1, 1990, between the Corporation and The Bank of New York, as
Trustee. (Incorporated by reference to Exhibit (4)(b) (ii) to the Corporation's Registration Statement No.
33-40456.)
(4)(l) Supplemental Indenture, dated as of November 15, 1992, between the Corporation and The Bank of New York,
as Trustee. (Incorporated by reference to Exhibit (4) to the Corporation's Current Report on Form 8-K
dated November 17, 1992.)
(4)(m) Form of Instrument of Resignation, Appointment and Acceptance, dated as of February 7, 1996, among the
Corporation, Harris Trust and Savings Bank and The Bank of New York (formerly Irving Trust Company).
(Incorporated by reference to Exhibit (4)(a) to the Corporation's Current Report on Form 8-K dated
February 7, 1996.)
(4)(n) Supplemental Indenture, dated as of February 7, 1996, between the Corporation and Harris Trust and Savings
Bank, as Trustee. (Incorporated by reference to Exhibit (4)(b) to the Corporation's Current Report on Form
8-K dated February 7, 1996.)
(4)(o) Form of Senior Medium-Term Notes. (Incorporated by reference to Exhibit (4)(c) (i) to the Corporation's
Registration Statement No. 33-40456.)
(4)(p) Form of Subordinated Medium-Term Notes. (Incorporated by reference to Exhibit (4)(c) (ii) to the
Corporation's Registration Statement No. 33-40456.)
(4)(q) Form of Warrant Agreement.
(4)(r) Form of Warrant Certificate. (Filed by reference to Exhibit A to Exhibit (4)(q).)
(4)(s) Indenture, dated as of November 27, 1996, between the Corporation and Wilmington Trust Company, as
Debenture Trustee. (Incorporated by reference to Exhibit (4)(a) to Registration Statement Nos. 333-19039
and 333-19039-01.)
(4)(t) Upon the request of the Securities and Exchange Commission, the Registrant will furnish a copy of all
other instruments defining the rights of holders of long-term debt of the Registrant.
(5) Opinion of Marion A. Cowell, Jr. as to the validity of the Securities.
</TABLE>
II-2
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT NO. EXHIBIT
<S> <C>
(12)(a) Computations of Consolidated Ratios of Earnings to Fixed Charges. (Incorporated by reference to Exhibit
(12) to the Corporation's 1997 Second Quarter Report on Form 10-Q.)
(12)(b) Computations of Consolidated Ratios of Earnings to Fixed Charges and Preferred Stock Dividends.
(Incorporated by reference to Exhibit (12)(b) to the Corporation's 1996 Annual Report on Form 10-K.)
(23)(a) Consent of Marion A. Cowell, Jr. (Included in Exhibit (5).)
(23)(b) Consent of KPMG Peat Marwick LLP.
(24) Power of Attorney.
(25)(a) Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of The Chase Manhattan Bank
(formerly Chemical Bank).
(25)(b) Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939 of Harris Trust and Savings Bank.
(27) The Corporation's Financial Data Schedule. (Incorporated by reference to Exhibit (27) to the Corporation's
1997 Second Quarter Report on Form 10-Q.)
</TABLE>
ITEM 17. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in the volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high and of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than 20% change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement.
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement;
PROVIDED, HOWEVER, that paragraphs (a)(1) (i) and (a)(1) (ii) do not apply if
the information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in the
registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial BONA FIDE offering thereof.
II-3
<PAGE>
(c) The undersigned registrant hereby undertakes that:
(1) for purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h)
under the Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective; and
(2) for the purpose of determining any liability under the Securities Act
of 1933, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial BONA FIDE offering thereof.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
First Union Corporation certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Charlotte, State of North Carolina, as of the
22nd day of August, 1997.
FIRST UNION CORPORATION
By: MARION A. COWELL, JR.
MARION A. COWELL, JR.
EXECUTIVE VICE PRESIDENT, SECRETARY
AND GENERAL COUNSEL
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE
<S> <C> <C>
EDWARD E. CRUTCHFIELD* Chairman and Chief Executive Officer and
EDWARD E. CRUTCHFIELD Director
ROBERT T. ATWOOD* Executive Vice President and Chief Financial
ROBERT T. ATWOOD Officer
JAMES H. HATCH* Senior Vice President and Corporate
JAMES H. HATCH Controller (Principal Accounting Officer)
EDWARD E. BARR* Director
EDWARD E. BARR
G. ALEX BERNHARDT* Director
G. ALEX BERNHARDT
W. WALDO BRADLEY* Director
W. WALDO BRADLEY
ROBERT J. BROWN* Director
ROBERT J. BROWN
A. DANO DAVIS* Director
A. DANO DAVIS
R. STUART DICKSON* Director
R. STUART DICKSON
B.F. DOLAN* Director
B.F. DOLAN
</TABLE>
II-5
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE
<S> <C> <C>
RODDEY DOWD, SR.* Director
RODDEY DOWD, SR.
JOHN R. GEORGIUS* Director
JOHN R. GEORGIUS
Director
ARTHUR M. GOLDBERG
WILLIAM H. GOODWIN, JR.* Director
WILLIAM H. GOODWIN, JR.
HOWARD H. HAWORTH* Director
HOWARD H. HAWORTH
FRANK M. HENRY* Director
FRANK M. HENRY
LEONARD G. HERRING* Director
LEONARD G. HERRING
JUAN RODRIGUEZ INCIARTE* Director
JUAN RODRIGUEZ INCIARTE
Director
JACK A. LAUGHERY
MAX LENNON* Director
MAX LENNON
RADFORD D. LOVETT* Director
RADFORD D. LOVETT
MACKEY J. MCDONALD* Director
MACKEY J. MCDONALD
JOSEPH NEUBAUER* Director
JOSEPH NEUBAUER
RANDOLPH N. REYNOLDS* Director
RANDOLPH N. REYNOLDS
RUTH G. SHAW* Director
RUTH G. SHAW
</TABLE>
II-6
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE
<S> <C> <C>
CHARLES M. SHELTON, SR.* Director
CHARLES M. SHELTON, SR.
LANTY L. SMITH* Director
LANTY L. SMITH
ANTHONY P. TERRACCIANO* Director
ANTHONY P. TERRACCIANO
DEWEY L. TROGDON* Director
DEWEY L. TROGDON
Director
JOHN D. UIBLE
B.J. WALKER* Director
B.J. WALKER
* By MARION A. COWELL, JR.,
MARION A. COWELL, JR., ATTORNEY-IN-FACT
</TABLE>
Dated: August 22, 1997
II-7
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NO. EXHIBIT
<S> <C> <C>
(1)(a) Form of Underwriting Agreement for Common Stock, Preferred Stock, Class
A Preferred Stock, Depositary Shares and Warrants.
(1)(b) Form of Underwriting Agreement for Debt Securities.
(2) Agreement and Plan of Mergers, dated July 18, 1997, among the
Corporation, FUNB-NC, Signet, and Signet Bank. (Incorporated by
reference to Exhibit (2) to the Corporation's Current Report on Form 8-K
dated July 21, 1997.)
(4)(a) Articles of Incorporation of the Corporation, as amended. (Incorporated
by reference to Exhibit (4) to the Corporation's 1990 First Quarter
Report on Form 10-Q, to Exhibit (99)(a) to the Corporation's 1993 First `
Quarter Report on Form 10-Q and to Exhibit (4)(a) to the Corporation's
Current Report on Form 8-K dated January 10, 1996.)
(4)(b) By-laws of the Corporation, as amended. (Incorporated by reference to
Exhibit (3)(b) to the Corporation's 1995 Annual Report on Form 10-K.)
(4)(c) Amended and Restated Shareholder Protection Rights Agreement.
(Incorporated by reference to Exhibit (4) to the Corporation's Current
Report on Form 8-K dated October 16, 1996.)
(4)(d) Form of Deposit Agreement.
(4)(e) Specimen Depositary Receipt. (Filed by reference to Exhibit A to Exhibit
(4)(d).)
(4)(f) Senior Indenture (including form of Senior Debt Security). (Incorporated
by reference to Exhibit (4) to the Corporation's Registration Statement
No. 2-98213.)
(4)(g) Supplemental Indenture, dated as of May 17, 1986, between the
Corporation and Chemical Bank, as Trustee. (Incorporated by reference to
Exhibit (4)(a) (ii) to Amendment No. 1 to the Corporation's Registration
Statement No. 33-30122.)
(4)(h) Supplemental Indenture, dated as of July 1, 1988, between the
Corporation and Chemical Bank, as Trustee. (Incorporated by reference to
Exhibit (4)(a) (iii) to Amendment No. 1 to the Corporation's
Registration Statement No. 33-30122.)
(4)(i) Supplemental Indenture, dated as of August 1, 1990, between the
Corporation and Chemical Bank, as Trustee. (Incorporated by reference to
Exhibit (4)(a) (iv) to the Corporation's Registration Statement No.
33-40456.)
(4)(j) Subordinated Indenture (including form of Subordinated Debt Security).
(Incorporated by reference to Exhibit (4)(a) to Amendment No. 1 to the
Corporation's Registration Statement No. 33-1852.)
(4)(k) Supplemental Indenture, dated as of August 1, 1990, between the
Corporation and The Bank of New York, as Trustee. (Incorporated by
reference to Exhibit (4)(b) (ii) to the Corporation's Registration
Statement No. 33-40456.)
(4)(l) Supplemental Indenture, dated as of November 15, 1992, between the
Corporation and The Bank of New York, as Trustee. (Incorporated by
reference to Exhibit (4) to the Corporation's Current Report on Form 8-K
dated November 17, 1992.)
(4)(m) Form of Instrument of Resignation, Appointment and Acceptance, dated as
of February 7, 1996, among the Corporation, Harris Trust and Savings
Bank and The Bank of New York (formerly Irving Trust Company).
(Incorporated by reference to Exhibit (4)(a) to the Corporation's
Current Report on Form 8-K dated February 7, 1996.)
(4)(n) Supplemental Indenture, dated as of February 7, 1996, between the
Corporation and Harris Trust and Savings Bank, as Trustee. (Incorporated
by reference to Exhibit (4)(b) to the Corporation's Current Report on
Form 8-K dated February 7, 1996.)
(4)(o) Form of Senior Medium-Term Notes. (Incorporated by reference to Exhibit
(4)(c) (i) to the Corporation's Registration Statement No. 33-40456.)
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT NO. EXHIBIT
<S> <C> <C>
(4)(p) Form of Subordinated Medium-Term Notes. (Incorporated by reference to
Exhibit (4)(c) (ii) to the Corporation's Registration Statement No.
33-40456.)
(4)(q) Form of Warrant Agreement.
(4)(r) Form of Warrant Certificate. (Filed by reference to Exhibit A to Exhibit
(4)(q).)
(4)(s) Indenture, dated as of November 27, 1996, between the Corporation and
Wilmington Trust Company, as Debenture Trustee. (Incorporated by
reference to Exhibit (4)(a) to Registration Statement Nos. 333-19039 and
333-19039-01.)
(4)(t) Upon the request of the Securities and Exchange Commission, the
Registrant will furnish a copy of all other instruments defining the
rights of holders of long-term debt of the Registrant.
(5) Opinion of Marion A. Cowell, Jr. as to the validity of the Securities.
(12)(a) Computations of Consolidated Ratios of Earnings to Fixed Charges.
(Incorporated by reference to Exhibit (12) to the Corporation's 1997
Second Quarter Report on Form 10-Q.)
(12)(b) Computations of Consolidated Ratios of Earnings to Rixed Charges and
Preferred Stock Dividends. (Incorporated by reference to Exhibit (12)(b)
to the Corporation's 1996 Annual Report on Form 10-K.)
(23)(a) Consent of Marion A. Cowell, Jr. (Included in Exhibit (5).)
(23)(b) Consent of KPMG Peat Marwick LLP.
(24) Power of Attorney.
(25)(a) Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939
of The Chase Manhattan Bank (formerly Chemical Bank).
(25)(b) Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939
of Harris Trust and Savings Bank.
(27) The Corporation's Financial Data Schedule. (Incorporated by reference to
Exhibit (27) to the Corporation's 1997 Second Quarter Report on Form
10-Q.)
</TABLE>
FIRST UNION CORPORATION*
[________ Shares of Common Stock,
Par Value $3.33 1/3 Per Share]
-or-
[________ Shares of [Class A] Preferred Stock[, Series ___],
No-Par Value]
-or-
[__________ Depositary Shares,
Each representing a [Fraction] Interest in a Share of]
[Class A] Preferred Stock[, Series ___], No-Par Value]
Underwriting Agreement
-------- --, ----
To the Representatives named in Schedule I hereto of the
Underwriters named in Schedule II hereto
Dear Sirs:
First Union Corporation ("First Union"), a North Carolina
corporation, proposes to sell to the underwriters named in Schedule II hereto
(the "Underwriters"), for whom you are acting as representatives (the
"Representatives"), an aggregate of __________
[shares of its Common Stock ("Common Stock"), par value
$3.33 1/3 per share (the "Securities")]
- -or-
[an aggregate of _________ shares of [Class A] Preferred
Stock[, Series ___] of First Union (the "Securities")]
- -or-
- --------
* Provisions for Warrants, over-allotment option and convertibility, if
necessary, would need to be added to introductory paragraph,
representations, opinions, etc.
1--
<PAGE>
[Depositary Shares (the "Shares"), each such share representing ownership of
[fraction] of a share of [Class A] Preferred Stock[, Series ___] of First Union
(the "Preferred Stock"). The Preferred Stock will, when issued, be deposited by
First Union against delivery of Depositary Receipts ("Depositary Receipts") to
be issued by First Union National Bank of North Carolina, as depositary (the
"Depositary"), under a Deposit Agreement, dated as of _________ __, ____ (the
"Deposit Agreement"), among First Union, the Depositary and the holders from
time to time of the Depositary Receipts issued thereunder. Each Depositary
Receipt will evidence one or more Shares. The Shares and the Preferred Stock are
herein collectively called the "Securities."]
1. Representations and Warranties. First Union
represents and warrants to, and agrees with, each Under
writer that:
(a) The registration statement (File No. 333- _____) on Form
S-3 (the "registration statement"), including a prospectus which, as
supplemented, shall be used in connection with the sale of the
Securities, has been filed with the Securities and Exchange Commission
(the "Commission"), in the form heretofore delivered to the
Representatives. The registration statement, as it may have been
amended prior to the date of this Agreement, has become effective under
the Securities Act of 1933, as amended (the "Act"). (The registration
statement, as amended to the date of this Agreement, is hereinafter
referred to as the "Registration State ment"; such prospectus (which
shall be in the form in which it has been most recently filed, or
transmitted for filing, with the Commission on or before the date of
this Agreement, as the same is proposed to be added to or changed), as
supplemented by a prospectus supplement relating to the Securities,
filed or transmitted for filing with the Commission pursuant to Rule
424 under the Act and used in connection with the sale of the
Securities, is hereinafter referred to as the "Prospectus"; and such
prospectus supplement is hereinafter referred to as the "Prospectus
Supplement". Any reference herein to the Registration Statement, a
preliminary prospectus or the Prospectus shall be deemed to refer to
and include the documents incorpo rated by reference therein pursuant
to Item 12 of Form S-3 which were filed under the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), on or before the date of
this Agreement, and any reference herein to the terms "amend",
"amendment" or "supplement" with respect to the Registration Statement
or the Prospectus
2--
<PAGE>
shall be deemed to refer to and include the filing of any document
under the Exchange Act deemed to be incor porated therein by reference
after the date of this Agreement.)
(b) The Registration Statement, at the time it became
effective, and any amendments thereof filed prior to the date hereof,
as of their respective effec tive dates, conformed in all material
respects to the requirements of the Act, the Trust Indenture Act of
1939, as amended (the "Trust Indenture Act"), and the respective rules
and regulations of the Commission thereunder; the Registration
Statement and the Prospec tus, as of the date of the Prospectus
Supplement, and any amendments thereof and supplements thereto, as of
their respective effective or issue dates, will conform in all material
respects to the requirements of the Act, the Trust Indenture Act and
the respective rules and regulations of the Commission thereunder, and
no such document, as of such respective dates and, in the case of the
Prospectus and any amendments thereof or supplements thereto, as of the
Closing Date (as hereinafter defined), included or will include any
untrue statement of a material fact or omitted or will omit to state
any material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances in which they
were made, not misleading, provided that First Union makes no
representations or warranties as to (i) the Statement of Eligibility
(Form T-1) under the Trust Indenture Act of any trustee or (ii) the
information contained in or omitted from the Prospectus or any
amendment thereof or supplement thereto in reliance upon and in
conformity with information furnished in writing to First Union by or
on behalf of any Underwriter specifically for use in connection with
the preparation of the Prospectus or any amendment thereof or
supplement thereto.
(c) First Union has been duly incorporated, is validly
existing as a corporation in good standing under the laws of its
jurisdiction of incorporation and has all power and authority
(corporate and other) necessary to own or hold its material properties
and to conduct its business substantially in the manner in which it
presently conducts such business.
(d) The [shares of Preferred Stock represented by the]
Securities being delivered to the Underwriters at the Closing Date have
been duly authorized and, when issued and delivered as provided in this
Agreement, will be duly and validly issued, fully paid and non-
3--
<PAGE>
assessable, and will have the rights set forth in First Union's
Articles of Incorporation, as amended to the Closing Date[, including
the Articles of Amendment relating to such shares (the "Amendment")
filed under Section ____ of the North Carolina Business Corporation
Act].
(e) First Union has all corporate power and authority
necessary to execute and deliver this Agreement, [the Preferred Stock,]
the Securities [and the Deposit Agreement] and to perform its
obligations hereunder and thereunder; the execution, delivery and
performance of this Agreement, [the Preferred Stock,] the Securities
[and the Deposit Agreement] by First Union and compliance with the
provisions hereof and thereof by First Union will not constitute a
breach of or default under, the corporate charter or by-laws of First
Union, or any material agreement, indenture or other instrument
relating to indebtedness for money borrowed to which First Union is a
party, or, to the best of First Union's knowledge, any law, order,
rule, regulation or decree of any court, governmental agency or
authority located in the United States having jurisdiction over First
Union or any property of First Union, which breach or default would be
reasonably likely to have a material adverse effect on First Union and
its subsidiaries taken as a whole; and no consent, authorization or
order of, or filing or registration with, any court or governmental
agency or authority is required for the execution, delivery and
performance of this Agreement, [the Preferred Stock,] the Securities
[and the Deposit Agreement] by First Union except such as have been
made or obtained or will be made or obtained on or before the Closing
Date (as defined in Section 3) and except such as may be required under
applicable state securities or "blue sky" laws.
[( ) The Amendment has been duly filed with the Secretary of
State of the State of North Carolina in accordance with the North
Carolina Business Corporation Act and with all other offices where such
filing is required.]
[( ) The Securities being delivered to the Underwriters at the
Closing Date have been duly authorized and, when issued and delivered
against payment therefor as provided in this Agreement, will be duly
and validly issued, fully paid and nonassessable and will be entitled
to the rights under, and the benefits of, the Deposit Agreement.]
4--
<PAGE>
[( ) The Deposit Agreement has been duly authorized, executed
and delivered by First Union and the Depositary and constitutes a valid
and legally binding agreement of First Union and the Depositary,
enforceable against First Union and the Depositary in accordance with
its terms, except as such enforceability may be limited by bankruptcy,
insolvency, reorganization or other similar laws relating to or
affecting the enforcement of creditors' rights generally and by general
principles of equity.]
( ) The [Preferred Stock, the] Securities [and the Deposit
Agreement] conform in all material respects to the descriptions thereof
in the Prospectus.
2. Purchase and Sale. Subject to the terms and conditions and
in reliance upon the representations and warranties herein set forth, First
Union agrees to sell to each Underwriter, and each Underwriter agrees, severally
and not jointly, to purchase from First Union, at the purchase price set forth
in Schedule I hereto, the principal amount of the Securities set forth opposite
such Underwriter's name in Schedule II hereto.
3. Delivery and Payment. Delivery of and payment for the
Securities shall be made at the office, on the date and at the time specified in
Schedule I hereto, which date and time may be postponed by agreement between the
Represen tatives and First Union (such date and time of delivery of and payment
for the Securities being herein called the "Closing Date"). Delivery of the
Securities shall be made to the Representatives for the respective accounts of
the several Underwriters against payment by the several Under writers through
the Representatives of the purchase price thereof to or upon the order of First
Union in the manner and type of funds specified in Schedule I. Certificates for
the Securities shall be registered in such names and in such denominations as
the Representatives may request not less than one full business day in advance
of the Closing Date.
First Union agrees to have the Securities avail able for
inspection, checking and packaging in New York, New York, on the business day
prior to the Closing Date.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the Securi ties for sale as set forth in the
Prospectus.
5. Agreements. First Union agrees with the several
Underwriters that:
5--
<PAGE>
(a) First Union will cause the Prospectus to be filed, or
transmitted for filing, with the Commission pursuant to Rule 424 under
the Act and will promptly advise the Representatives when the
Prospectus has been so filed or transmitted for filing, and, prior to
the termination of the offering of the Securities to which such
Prospectus relates, also will promptly advise the Representatives (i)
when any amendment to the Regis tration Statement has become effective
or any further supplement to the Prospectus has been so filed or
transmitted for filing, (ii) of any request by the Commission for any
amendment of the Registration Statement or the Prospectus or for any
additional information, (iii) of the issuance by the Commission of any
stop order suspending the effectiveness of the Reg istration Statement
or the institution or threatening of any proceeding for that purpose,
and (iv) of the receipt by First Union of any notification with respect
to the suspension of the qualification of the Securi ties for sale in
any jurisdiction or the initiation or threatening of any proceeding for
such purpose. First Union will use its reasonable best efforts to
prevent the issuance of any such stop order and, if issued, to obtain
as soon as reasonably possible the withdrawal thereof. For so long as a
prospectus relating to the Securities is required to be delivered under
the Act, First Union will not file or transmit for filing any amendment
to the Registration Statement or supplement to the Prospectus which
relates to the Securities unless First Union has furnished you or
counsel for the Underwriters a copy for your review prior to filing or
transmission for filing.
(b) If, at any time when a prospectus relating to the
Securities is required to be delivered under the Act, any event occurs
as a result of which the Prospectus as then amended or supplemented
would include any untrue statement of a material fact or omit to state
any material fact necessary to make the statements therein in the light
of the circumstances under which they were made not misleading, or if
it shall be necessary to amend or supplement the Prospectus in
connection with the sale of the Securities to comply with the Act or
the rules and regulations of the Commission thereunder, promptly after
becoming aware thereof, First Union will notify the Representatives or
counsel for the Underwriters and, upon their or its reasonable request,
prepare and file or transmit for filing with the Commission an
amendment or supplement which will correct such statement or omission
or effect such compliance.
6--
<PAGE>
(c) First Union will make generally available to its security
holders and to the Representatives as soon as practicable, but not
later than 45 days after the end of the 12-month period beginning at
the end of the fiscal quarter of First Union during which the filing,
or transmission for filing, of the Prospectus pursuant to Rule 424
under the Act occurs (except not later than 90 days after the end of
such period if such quarter is the last fiscal quarter), an earnings
statement (which need not be audited) of First Union and its subsidi-
aries, covering such 12-month period, which will satisfy the provisions
of Section 11(a) of the Act.
(d) First Union will use its best efforts to furnish in New
York City to each of the Underwriters prior to 10:00 a.m., New York
City time, on the New York business day next succeeding the date of
this Agreement and from time to time, as many copies of the Prospectus,
each related preliminary prospectus supplement and all amendments of
and supplements to such documents as may be reasonably requested.
(e) First Union will pay all expenses incident to the
performance of its obligations under this Agree ment, and will pay the
expenses of printing and filing all documents relating to the offering
and mailing and delivering such to Underwriters and dealers, any filing
fee incident to any required review by the National Association of
Securities Dealers, Inc. of the terms of the sale of the Securities,
all expenses in connection with the qualification of the Securities for
offering and sale under state securities laws (including the fees and
disbursements of counsel to the Underwriters in connection with such
qualification and the preparation of the Blue Sky and legal investment
surveys), any taxes payable in connection with the sale and delivery of
the Securities by First Union to the Underwriters, and any fees charged
for rating the Securities.
(f) First Union will use its reasonable best efforts to
arrange for the qualification of the Securities for sale under the laws
of such jurisdictions as the Representatives may designate and to
maintain such qualifications in effect so long as required for the
distribution of the Securities; provided that First Union shall not be
required to qualify to do business in any jurisdiction where it is not
now qualified or to take any action which would subject it to general
or unlimited service of process in any jurisdiction where it is not now
so subject.
7--
<PAGE>
(g) During the period beginning from the date of this
Agreement and continuing until the Closing Date or such longer period
as may be agreed to by First Union and set forth in Schedule I hereto
relating to the Securities, First Union will not offer, sell, contract
to sell or otherwise dispose of any of its securities which are
substantially similar to the Securities without the prior written
consent of the Representatives [, other than shares of its Common Stock
pursuant to its dividend reinvestment plan, stock options and other
benefit plans, or commitments existing prior to the date of this
Agreement].
6. Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters to purchase the Securities shall be subject to
the accuracy in all material respects of the representations and warranties on
the part of First Union contained herein as of the date hereof and the Closing
Date, to the accuracy in all material respects of the statements of First Union
made in any certificates pursuant to the provisions hereof, to the per formance
in all material respects by First Union of its obligations hereunder and to the
following additional conditions:
(a) No stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for
that purpose shall have been insti tuted and be pending or have been
threatened as of the Closing Date; and all requests for additional
informa tion on the part of the Commission shall have been complied
with.
(b) First Union shall have furnished to the Representatives a
certificate, dated the Closing Date, of First Union, signed by the
principal financial or accounting officer of First Union, to the effect
that, to the best of his knowledge after reasonable investigation:
(i) The representations and warranties of First Union
in this Agreement are true and correct in all material
respects on and as of the Closing Date with the same effect as
if made on the Closing Date and First Union has complied with
all the agreements and satisfied all the conditions on its
part to be performed or satisfied at or prior to the Closing
Date, in all material respects;
(ii) No stop order suspending the effective
ness of the Registration Statement has been issued
8--
<PAGE>
and no proceedings for that purpose have been
instituted and are pending or have been threatened
as of such date;
(iii) Since the date of the most recent financial
statements included in the Prospectus, there has been no
material adverse change in the financial position, results of
operations, cash flows or prospects relating thereto of First
Union and its subsidiaries consolidated, except as set forth
in or contemplated by the Prospectus; and
(iv) Since the date of this Agreement, (A) no downgrading
has occurred in the rating accorded First Union's unsecured
debt securities or preferred stock as described in Section
6(h)(i) and (B) no announcement has been made with respect to
any rating accorded First Union's unsecured debt securities or
preferred stock as described in Section 6(h)(ii).
(c) First Union shall have furnished to the
Underwriters the opinion, dated the Closing Date, of
Marion A. Cowell, Jr., Executive Vice President,
Secretary and General Counsel of First Union, to the
effect that:
(i) First Union has been duly incorporated and is
validly existing as a corporation in good standing under the
laws of the State of North Carolina, with corporate power and
authority under such laws to own its material properties and
to conduct its business substantially as described in the
Prospectus;
(ii) The [shares of Preferred Stock represented by
the] Securities being delivered to the Underwriters at the
Closing Date have been duly authorized and, when issued and
delivered as provided in this Agreement, will be duly and
validly issued, fully paid and nonassessable, and will have
the rights set forth in First Union's Articles of
Incorporation, as amended to the Closing Date[, including the
Amendment];
(iii) First Union has all corporate power and
authority necessary to execute and deliver this Agreement,
[the Preferred Stock,] the Securities [and the Deposit
Agreement] and to perform its obligations hereunder and
thereunder; the execution, delivery and performance of this
9--
<PAGE>
Agreement, [the Preferred Stock,] the Securities [and the
Deposit Agreement] by First Union and compliance with the
provisions hereof and thereof by First Union will not
constitute a breach of or default under, the corporate charter
or by-laws of First Union, or any material agreement,
indenture or other instrument relating to indebtedness for
money borrowed known to such counsel to which First Union is a
party, or, to the best of such counsel's knowledge, any law,
order, rule, regulation or decree of any court, governmental
agency or authority located in the United States having
jurisdiction over First Union or any property of First Union,
which breach or default would be reasonably likely to have a
material adverse effect on First Union and its subsidiaries
taken as a whole; and no consent, authorization or order of,
or filing or registration with, any court or governmental
agency or authority is required for the execution, delivery
and performance of this Agreement, [the Preferred Stock,] the
Securities [and the Deposit Agreement] by First Union except
such as have been made or obtained or will be made or obtained
on or before the Closing Date (as defined in Section 3) and
except such as may be required under applicable state
securities or "blue sky" laws;
[( ) The Amendment has been duly filed with the
Secretary of State of the State of North Carolina in
accordance with the North Carolina Business Corporation Act
and with all other offices where such filing is required;]
[( ) The Securities being delivered to the
Underwriters at the Closing Date have been duly authorized
and, when issued and delivered against payment therefor as
provided in this Agreement, will be duly and validly issued,
fully paid and nonassessable and will be entitled to the
rights under, and the benefits of, the Deposit Agreement;]
[( ) The Deposit Agreement has been duly authorized,
executed and delivered by First Union and the Depositary and
constitutes a valid and legally binding agreement of First
Union and the Depositary, enforceable against First Union and
the Depositary in accordance with its terms, except as such
enforceability may be limited by bankruptcy, insolvency,
reorganization or other
10--
<PAGE>
similar laws relating to or affecting the
enforcement of creditors' rights generally and by
general principles of equity;]
( ) The [Preferred Stock, the] Securities [and the
Deposit Agreement] conform in all material respects to the
descriptions thereof in the Prospectus; and
( ) The Registration Statement has become effective
under the Act, and, to the best of the knowledge of such
counsel, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for
that purpose have been instituted or are pending or threatened
under the Act, and each part of the Registration Statement,
when such part became effective, any amendments thereof filed
prior to the date of this Agreement, as of their respective
effective dates, and the Registration Statement and the
Prospectus, as of the date of the Prospectus Supplement, and
each amendment thereof or supplement thereto, as of their
respective effective or issue dates, appeared on their face to
be appropriately responsive in all material respects to the
requirements of the Act, the Trust Indenture Act and the
respective rules and regulations of the Commission
thereunder; such counsel has no reason to believe that any
part of the Registration Statement, when such part became
effective, contained any untrue statement of a material fact
or omitted to state any material fact required to be stated
therein or necessary to make the statements therein not
misleading, or that the Prospectus, as of the date of the
Prospectus Supplement, or any amendments thereof or
supplements thereto, as of their respective effective or issue
dates, contained any untrue statement of a material fact or
omitted to state any material fact necessary to make the
statements therein, in the light of the circumstances under
which they were made, not misleading, or that, as of the
Closing Date, either the Prospectus or any further amendment
or supplement thereto made by the Company prior to the Closing
Date contained any untrue statement of a material fact or
omitted to state any material fact necessary to make the
statements therein, in the light of the circumstances under
which they were made, not misleading; it being understood that
such counsel need express no opinion as to the Statement of
11--
<PAGE>
Eligibility (Form T-1) under the Trust Indenture Act of the
Trustee, as to the financial statements or other financial
data contained in any part of the Registration Statement or
the Prospectus, as to any statements or omissions made in
reliance upon or in conformity with information furnished in
writing to First Union by or on behalf of an Underwriter for
use therein.
As to matters governed by New York law, such counsel may rely
upon the opinion of Sullivan & Cromwell.
(d) The Representatives shall have received from Sullivan &
Cromwell, counsel for the Underwriters, such opinion or opinions, dated
the Closing Date, with respect to such matters as the Representatives
may reasonably require.
As to matters governed by North Carolina law,
Sullivan & Cromwell may rely upon the opinion of
Marion A. Cowell, Jr. delivered pursuant to
Section 6(c).
(e) KPMG Peat Marwick LLP, as independent accountants of First
Union, shall have furnished to the Representatives a letter, dated as
of the Closing Date, to the effect set forth in Schedule III hereto.
(f) Subsequent to the date hereof, there shall not have
occurred any change, or any development involving a prospective change,
in or affecting the financial position, long-term debt, stockholders'
equity or results of operations of First Union and its consolidated
subsidiaries which the Representatives conclude, after consultation
with First Union, in the judgment of the Representatives is so material
and adverse as to make it impractical or inadvisable to proceed with
the public offering or the delivery of the Securities as contemplated
by the Prospectus.
(g) First Union shall have furnished to the Representatives
such further information, certificates and documents as they may
reasonably request prior to the Closing Date.
(h) Subsequent to the date of this Agreement, (i) no
downgrading shall have occurred in the rating accorded First Union's
unsecured debt securities or preferred stock by Standard & Poor's
Ratings Group or by Moody's Investors Service, Inc. and (ii) neither
12--
<PAGE>
such organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating
of any of First Union's unsecured debt securities or preferred stock.
If any of the conditions specified in this Section 6 shall not
have been fulfilled in all material respects when and as provided in this
Agreement, or if any of the opinions and certificates mentioned above or
elsewhere in this Agreement shall not be in all material respects reasonably
satisfactory in form and substance to the Representatives and their counsel,
this Agreement and all obligations of the Underwriters hereunder may be can
celled at, or at any time prior to, the Closing Date by the Representatives.
Notice of such cancellation shall be given to First Union in writing or by
telephone or telegraph confirmed in writing.
7. Indemnification and Contribution. (a) First Union agrees to indemnify and
hold harmless each Underwriter and each person who controls any Underwriter
within the meaning of either the Act or the Exchange Act against any and all
losses, claims, damages or liabilities, joint or several, to which they or any
of them may become subject under the Act, the Exchange Act or other Federal or
state statutory law or regulation, at common law or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the registration statement or in any amendment
thereof filed prior to the date hereof, or in the Registration Statement or the
Prospectus, or in any amendment thereof or supplement thereto, or in any related
preliminary prospectus or preliminary prospectus supplement, or arise out of or
are based upon 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 agrees to reimburse each such indem nified party for any legal
or other expenses reasonably incurred by them in connection with investigating
or defending any such loss, claim, damage, liability or action; provided,
however, that (i) First Union will not be liable in any such case to the extent
that any such loss, claim, damage or liability arises out of or is based upon
any such untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in con formity with written
information furnished to First Union by or on behalf of any Underwriter through
the Representatives specifically for use in the Prospectus or any supplement
thereto or any related preliminary prospectus or preliminary prospectus
supplement or of the Statement of Eligibility
13--
<PAGE>
(Form T-1) under the Trust Indenture Act of the Trustee, and (ii) such indemnity
with respect to any related preliminary prospectus or preliminary prospectus
supplement shall not inure to the benefit of any Underwriter (or any person
controlling such Underwriter) from whom the person asserting any such loss,
claim, damage or liability purchased the Securities which are the subject
thereof if such person was not sent or given a copy of the Prospectus (or the
Prospectus as amended or supplemented), excluding documents incorporated therein
by reference, at or prior to the confirmation of the sale of such Securities to
such person in any case where such delivery is required by the Act and the
untrue statement or omission of a material fact contained in such related
preliminary prospectus or prelimi nary prospectus supplement was corrected in
the Prospectus (or the Prospectus as amended or supplemented). This indemnity
agreement will be in addition to any liability which First Union may otherwise
have.
(b) Each Underwriter severally agrees to indemnify and hold
harmless First Union, each of its directors, each of its officers who signs the
Registration Statement, and each person who controls First Union within the
meaning of either the Act or the Exchange Act, to the same extent as the
foregoing indemnity from First Union to each Underwriter, but only with
reference to written information furnished to First Union by or on behalf of
such Underwriter through the Representatives specifically for use in the Pro
spectus or any supplement thereto or any related preliminary prospectus or
preliminary prospectus supplement. This indemnity agreement will be in addition
to any liability which any Underwriter may otherwise have.
(c) Promptly after receipt by an indemnified party under
Section 7(a) or (b) of notice of the commence ment of any action, such
indemnified party will, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party will not relieve the indemnifying party from any liability
which it may have to any indemnified party otherwise than under Section 7(a) or
(b). In case any such action is brought against any indemnified party, and it
notifies the indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate therein, and to the extent that it may
elect by written notice delivered to the indemnified party promptly after
receiving the aforesaid notice from such indemnified party, to assume the
defense thereof, with counsel satisfactory to such indemnified party; provided
that, if the defendants in any such action include both the
14--
<PAGE>
indemnified party and the indemnifying party and the indem nified party shall
have reasonably concluded that there may be legal defenses available to it
and/or other indemnified parties which are different from or additional to those
available to the indemnifying party, the indemnified party or parties shall have
the right to select separate counsel to assert such legal defenses and to
otherwise participate in the defense of such action on behalf of such
indemnified party or parties. Upon receipt of notice from the indemni fying
party to such indemnified party of its election so to assume the defense of such
action and approval by the indemnified party of counsel, the indemnifying party
will not be liable to such indemnified party under Section 7(a) or (b) for any
legal or other expenses subsequently incurred by such indemnified party (other
than reasonable costs of investigation) in connection with the defense thereof
unless (i) the indemnified party shall have employed separate counsel in
connection with the assertion of legal defenses in accordance with the proviso
to the next preceding sen tence (it being understood, however, that the
indemnifying party shall not be liable for the expenses of more than one
separate national counsel, approved by the Representatives, representing the
indemnified parties who are parties to such action), (ii) the indemnifying party
shall not have employed counsel satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after notice of
commencement of the action or (iii) the indemnifying party has authorized the
employment of counsel for the indemnified party at the expense of the
indemnifying party; and except that, if clause (i) or (iii) is applicable, such
liability shall be only in respect of the counsel referred to in such clause (i)
or (iii).
(d) If the indemnification provided for in this Section 7 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by First Union on the one hand and the Underwriters
of the Securities on the other from the offering of the Securities to which such
loss, claim, damage or liability (or action in respect thereof) relates. If,
however, the allocation provided by the immediately preceding sentence is not
permitted by appli cable law or if the indemnified party failed to give the
notice required under subsection (c) above, then each indemnifying party shall
contribute to such amount paid or
15--
<PAGE>
payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of First
Union on the one hand and the Underwriters of the Securities on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities (or actions in respect thereof), as well as any
other relevant equitable considerations. The relative benefits received by First
Union on the one hand and such Underwriters on the other shall be deemed to be
in the same proportion as the total net proceeds from such offering (before
deducting expenses) received by First Union bear to the total underwriting
discounts and commissions received by such Underwriters. The relative fault
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by First Union on the
one hand or such Underwriters on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. First Union and the Under writers agree that it would not
be just and equitable if contribution pursuant to this subsection (d) were
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to above in this subsec
tion (d). The amount paid or payable by an indemnified party as a result of the
losses, claims, damages or lia bilities (or actions in respect thereof) referred
to above in this subsection (d) shall be deemed to include 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 subsection (d), no Underwriter shall be required to contri
bute any amount in excess of the amount by which the total price at which the
applicable Securities underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The obligations of the Under writers of Securities in this
subsection (d) to contribute are several in proportion to their respective
underwriting obligations with respect to the Securities and not joint.
8. Termination. This Agreement shall be subject to termination
in the absolute discretion of the Representa-
16--
<PAGE>
tives, by notice given to First Union prior to delivery of and payment for the
Securities, if prior to such time (i) trading in securities generally on the New
York Stock Exchange shall have been suspended or materially limited, (ii) a
general moratorium on commercial banking activities in New York shall have been
declared by either Federal or New York State authorities, or (iii) there shall
have occurred any material outbreak or escalation of hostilities or other
calamity or crisis the effect of which on the financial markets of the United
States is such as to make it, in the reasonable judgment of the Representatives,
impracticable or inadvisable to proceed with the public offering or the delivery
of the Securities as contemplated by the Prospectus.
9. Substituted Underwriters. If, on the Closing Date, any one
or more of the Underwriters shall fail or refuse to purchase Securities that it
or they have agreed to purchase hereunder on such date, and the aggregate number
of Securities which such defaulting Underwriter or Underwriters agreed but
failed or refused to purchase is not more than one-tenth of the aggregate number
of the Securities to be purchased on the Closing Date, the other Underwriters
shall be obligated severally in the proportions that the number of Securities
set forth opposite their respective names in Schedule II bears to the aggregate
number of Securities set forth opposite the names of all such non-defaulting
Underwriters, or in such other proportions as the Underwriters may agree, to
purchase the Securities which such defaulting Underwriter or Underwriters agreed
but failed or refused to purchase on the Closing Date; provided that in no event
shall the number of Securities that any Underwriter has agreed to purchase
pursuant to Section 2 above be increased pursuant to this Section 9 by an amount
in excess of one-ninth of such number of Securities without the written consent
of such Underwriter. If, on the Closing Date, any Underwriter or Underwriters
shall fail or refuse to purchase Securities and the aggregate number of
Securities with respect to which such default occurs is more than one-tenth of
the aggregate number of Securities to be purchased on the Closing Date, and
arrangements satisfactory to the Underwriters and First Union for the purchase
of such Securities are not made within 36 hours after such default, this
Agreement shall terminate without liability on the part of any non-defaulting
Underwriter or First Union. In such case either the Underwriters or First Union
shall have the right to postpone the Closing Date, but in no event for longer
than seven days, in order that the required changes, if any, in the Registration
Statement and in the Prospectus or in any other documents or arrangements may be
effected. Any action taken under this Section 9 shall not relieve any
17--
<PAGE>
defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
10. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of
First Union or its officers and of the Underwriters set forth in or made pursu-
ant to this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter or First Union or any of
the officers, directors or controlling persons referred to in Section 7 hereof,
and will survive delivery of and payment for the Securities. The provisions of
Sections 5(e), 7, 9, 11, 12 and 13 hereof shall survive the termination or
cancellation of this Agreement.
11. Successors. This Agreement will inure to the benefit of
and be binding upon the parties hereto (including any Underwriter or
Underwriters added pursuant to Section 9 hereof)and their respective successors,
heirs, executors, administrators and the officers and directors and controlling
persons referred to in Section 7 hereof, and no other person will have any right
or obligation hereunder.
12. APPLICABLE LAW. THIS AGREEMENT WILL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
13. Counterparts; Notices. This Agreement may be signed in any
number of counterparts, each of which shall be deemed an original, which taken
together shall constitute one and the same instrument.
All notices hereunder shall be in writing or by telegram if
promptly confirmed in writing, and if to the Underwriters shall be sufficient in
all respects if deliv ered or sent by registered mail to the address of the
Representatives as set forth in Schedule I hereto; and if to First Union shall
be sufficient in all respects if delivered or sent by registered mail to the
address of First Union set forth in the Registration Statement, Attention:
Secretary; provided, however, that any notice to an Underwriter pursu ant to
Section 7(c) hereof shall be delivered or sent by registered mail to such
Underwriter at its address set forth in its Underwriters' Questionnaire, or
telex constituting such Questionnaire, which address will be supplied to First
Union by the Representatives upon request.
14. Action by Underwriters. Any action under this Agreement
taken by the Underwriters jointly or by the
18--
<PAGE>
firm signing below on behalf of you as the Representatives will be binding upon
all the Underwriters.
19--
<PAGE>
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding agreement
between First Union and the Underwriters.
Very truly yours,
FIRST UNION CORPORATION
----------------------------
Name:
Title:
The foregoing Agreement is hereby confirmed and accepted as of the date first
above written.
By: [Representatives]
On behalf of the Underwriters
set forth in Schedule II
By: ______________________________
Name:
Title:
20--
<PAGE>
SCHEDULE I
TITLE OF DESIGNATED SECURITIES:
[Common Stock, par value $3.33 1/3 per share] [[Class A] Preferred
Stock [, Series __], no-par value] [Depositary Shares, each
representing a [Fraction]
Interest in a Share of [Class A] Preferred Stock
[, Series __], no-par value]
AMOUNT OF SECURITIES:
_____________
PRICE TO PUBLIC:
$_____ per Security [, plus accrued dividends, if any,
from _________ __, ____]
PURCHASE PRICE BY UNDERWRITERS:
$_____ per Security [, plus accrued dividends, if any,
from _________ __, ____]
SPECIFIED FUNDS FOR PAYMENT OF PURCHASE PRICE:
Immediately available funds by wire
DEPOSIT AGREEMENT:
[Deposit Agreement, dated as of ________ __, ____,
between First Union and __________, as Depositary]
MATURITY:
[________ __, ____]
DIVIDEND RATE:
[_____% per annum] [describe floating rate provisions]
DIVIDEND PAYMENT DATES:
[________ __, ________ __, ________ __ and ________ __ of each year,
commencing _______ __, ____]
REGULAR RECORD DATES:
21--
<PAGE>
[________ __, ________ __, ________ __ and ________ __ of each year,
commencing _______ __, ____]
REPAYMENT PROVISIONS:
[Describe repayment provisions, if any]
REDEMPTION PROVISIONS:
[Describe redemption provisions, if any]
SINKING FUND PROVISIONS:
[Describe sinking fund provisions, if any]
CONVERSION PROVISIONS:
[Describe conversion provisions, if any]
EXCHANGE PROVISIONS:
[Describe exchange provisions, if any]
OTHER TERMS:
[Describe additional terms, if any]
ADDITIONAL COMFORT LETTER COVERAGE:
[Describe additional coverage, if any]
FORM OF DESIGNATED SECURITY:
[[Global] [Certificated] [in denominations set forth in
the Prospectus Supplement]]
CLOSING DATE:
________ __, ____ at [time]
RESTRICTED PERIOD UNDER SECTION 5(G) OF UNDERWRITING
AGREEMENT:
[Describe period if other than through Closing Date]
22--
<PAGE>
OFFICE FOR DELIVERY OF DESIGNATED SECURITIES:
[insert address]
OFFICE FOR PAYMENT FOR DESIGNATED SECURITIES:
[insert address]
NAME OF REPRESENTATIVES:
[insert names]
ADDRESS FOR NOTICES, ETC.:
[insert address]
23--
<PAGE>
SCHEDULE II
Amount of
Securities
to be
Underwriter Purchased
[underwriters names]
TOTAL ___________
<PAGE>
SCHEDULE III
Pursuant to Section 6(e) of the Underwriting Agreement, the
independent accountants of First Union shall provide a comfort letter to the
effect that:
(i) They are independent certified public accountants with
respect to First Union and its subsidiaries within the meaning of the Act and
the applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules examined by them and included
or incorporated by reference in the Prospectus as amended or supplemented comply
as to form in all material respects with the applicable accounting requirements
of the Act or the Exchange Act, as applicable, and the published rules and
regulations thereunder;
(iii) On the basis of limited procedures, not constituting an
audit, consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available interim
financial statements of First Union and its subsidiaries, inspection of the
minute books of First Union and its subsidiaries since the date of the latest
audited financial statements included or incorporated by reference in the
Prospectus as amended or supplemented, inquiries of officials of First Union and
its subsidiaries responsible for financial and accounting matters and such other
inquiries and procedures as may be specified in such letter, nothing came to
their attention that caused them to believe that:
(A) the unaudited consolidated statements of income,
consolidated balance sheets and consolidated statements of changes in
financial position included or incorporated by reference in First
Union's most recent Quarterly Report on Form 10-Q incorporated by
reference in the Prospectus (if any) as amended or supplemented does
not comply as to form in all material respects with the applicable
accounting requirements of the Exchange Act as it applies to Form 10-Q
and the related published rules and regulations thereunder or are not
in conformity with generally accepted accounting principles applied on
a basis substantially consistent with that of the audited consolidated
financial statements included or incorporated by reference in First
Union's most recent Annual Report on Form 10-K;
III-1
<PAGE>
(B) any unaudited financial data included in the Prospectus as
amended or supplemented as at any time, or for any period ending, after
the end of the latest interim period covered by a Quarterly Report on
Form 10-Q of First Union or year ended for which First Union has filed
an Annual Report on Form 10-K (whichever is more recent) (and any data
for any comparable prior period included therein) do not agree with the
corresponding amounts in the unaudited consolidated financial
statements from which such data are derived, or any such unaudited
financial data were not deter mined on a basis substantially consistent
with the basis for the corresponding amounts in the audited
consolidated financial statements included or incorpo rated by
reference in First Union's most recent Annual Report on Form 10-K;
(C) the unaudited pro forma consolidated condensed financial
statements (if any) included or incorporated by reference in the
Prospectus do not comply as to form in all material respects with the
applicable accounting requirements of the Act and the published rules
and regulations thereunder or the pro forma adjustments have not been
properly applied to the historical amounts in the compilation of those
state ments;
(D) as of a specified date not more than five days prior to
the date of delivery of such letter there have been any changes in the
capital stock (other than issuances of capital stock upon exercise of
options and stock appreciation rights, upon earn outs of perfor mance
shares and upon conversions of convertible securities, in each case
which were outstanding on the date of the latest audited financial
statements included or incorporated by reference in the Prospectus as
amended or supplemented) or long-term debt of First Union or any of its
subsidiaries, or any decreases in consolidated stockholders' equity,
consolidated assets, consolidated deposits, or allowance for loan
losses of First Union or other items specified by the Represen tatives,
or any increases in any items specified by the Representatives, in each
case as compared with amounts shown in the latest balance sheet
included or incor porated by reference in the Prospectus as amended or
supplemented except in each case for changes, increases or decreases
which the Prospectus as amended or supplemented discloses have occurred
or may occur or which are described in such letter; and
(E) for the period from the date of the latest financial
statements included or incorporated by refer ence in the Prospectus as
amended or supplemented to
III-2
<PAGE>
the end of the latest period for which financial statements are
available there were any decreases in consolidated net interest income,
net interest income after provision for loan losses, or the total or
per share amounts of net income of First Union or other items specified
by the Representatives, or any increases in any items specified by the
Representatives, in each case as compared with the comparable period of
the preceding year and with any other period of corresponding length
specified by the Representatives, except in each case for increases or
decreases which the Prospectus as amended or supplemented discloses
have occurred or may occur or which are described in such letter;
(iv) In addition to the examination referred to in their report(s)
included or incorporated by reference in the Prospectus and the limited
procedures, inspection of minute books, inquiries and other procedures referred
to in subparagraph (iii) above, they have carried out certain specified
procedures, not constituting an audit, with respect to certain amounts,
percentages and financial information specified by the Representatives which are
derived from the general accounting records of First Union and its subsidiaries,
which appear in the Prospectus as amended or supplemented (excluding documents
incorporated by reference), in exhibits to the Registration Statement specified
by the Representatives, or in documents incor porated by reference in the
Prospectus specified by the Representatives, and have compared certain of such
amounts, percentages and financial information with the accounting records of
First Union and its subsidiaries and have found them to be in agreement.
III-3
FIRST UNION CORPORATION*
$---------
[____%] [[Senior] [Subordinated]] [[Debentures] [Notes]]
Due _________ __,____
Underwriting Agreement
-------- --, ----
To the Representatives named in Schedule I hereto of the
Underwriters named in Schedule II hereto
Dear Sirs:
First Union Corporation ("First Union"), a North Carolina
corporation, proposes to sell to the underwriters named in Schedule II hereto
(the "Underwriters"), for whom you are acting as representatives (the
"Representatives"), its designated debt securities named in Schedule I hereto
(the "Securities"), in the aggregate principal amount set forth in such Schedule
I. The Securities will be issued under the indenture referenced in Schedule I
hereto (the "Indenture"), between First Union and the trustee named in Schedule
I (the "Trustee").
1. Representations and Warranties. First Union
represents and warrants to, and agrees with, each Under
writer that:
(a) The registration statement (File No. 33- 61941) on Form
S-3, and the registration statement (File No. 333-_____) on Form S-3
(the "registration statements"), including a prospectus which, as
supplemented, shall be used in connection with the sale of the
Securities, have been filed with the Securities and Exchange Commission
(the "Commission"), in the forms heretofore delivered to the
Representatives.
- --------
* Provisions for Warrants, over-allotment option and convertibility, if
necessary, would need to be added to introductory paragraph,
representations, opinions, etc.
-1-
<PAGE>
Each registration statement, as it may have been amended prior to the
date of this Agreement, has become effective under the Securities Act
of 1933, as amended (the "Act"). (The registration statements, as
amended to the date of this Agreement, are hereinafter collectively
referred to as the "Registration State ment"; such prospectus (which
shall be in the form in which it has been most recently filed, or
transmitted for filing, with the Commission on or before the date of
this Agreement, as the same is proposed to be added to or changed), as
supplemented by a prospectus supplement relating to the Securities,
filed or transmitted for filing with the Commission pursuant to Rule
424 under the Act and used in connection with the sale of the
Securities, is hereinafter referred to as the "Prospectus"; and such
prospectus supplement is hereinafter referred to as the "Prospectus
Supplement". Any reference herein to the Registration Statement, a
preliminary prospectus or the Prospectus shall be deemed to refer to
and include the documents incorporated by reference therein pursuant
to Item 12 of Form S-3 which were filed under the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), on or before the date of
this Agreement, and any reference herein to the terms "amend",
"amendment" or "supplement" with respect to the Registration Statement
or the Prospectus shall be deemed to refer to and include the filing of
any document under the Exchange Act deemed to be incor porated therein
by reference after the date of this Agreement.)
(b) The Registration Statement, at the time it became
effective, and any amendments thereof filed prior to the date hereof,
as of their respective effec tive dates, conformed in all material
respects to the requirements of the Act, the Trust Indenture Act of
1939, as amended (the "Trust Indenture Act"), and the respective rules
and regulations of the Commission thereunder; the Registration
Statement and the Prospec tus, as of the date of the Prospectus
Supplement, and any amendments thereof and supplements thereto, as of
their respective effective or issue dates, will conform in all material
respects to the requirements of the Act, the Trust Indenture Act and
the respective rules and regulations of the Commission thereunder, and
no such document, as of such respective dates and, in the case of the
Prospectus and any amendments thereof or
-2-
<PAGE>
supplements thereto, as of the Closing Date (as hereinafter defined),
included or will include any untrue statement of a material fact or
omitted or will omit to state any material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading, provided that
First Union makes no representations or warranties as to (i) the
Statement of Eligibility (Form T-1) under the Trust Indenture Act of
the Trustee or (ii) the information contained in or omitted from the
Prospectus or any amendment thereof or supplement thereto in reliance
upon and in conformity with information furnished in writing to First
Union by or on behalf of any Underwriter specifically for use in
connection with the preparation of the Prospectus or any amendment
thereof or supplement thereto.
(c) First Union has been duly incorporated, is validly
existing as a corporation in good standing under the laws of its
jurisdiction of incorporation and has all power and authority
(corporate and other) necessary to own or hold its material properties
and to conduct its business substantially in the manner in which it
presently conducts such business.
(d) The Securities have been duly authorized, and, when
issued, delivered and paid for pursuant to this Agreement, will have
been duly executed, authenticated, issued and delivered and will
constitute valid and legally binding obligations of First Union
entitled to the benefits provided by the Indenture; the Indenture has
been duly authorized and, at the Closing Date (as defined in Section 3
hereof), the Indenture will be duly qualified under the Trust Indenture
Act and will constitute a valid and legally binding instrument,
enforceable in accordance with its terms, subject, as to enforcement,
to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or
affecting creditors' rights and to general equity principles; and the
Securities and the Indenture conform in all material respects to the
descriptions thereof in the Prospectus.
(e) First Union has all corporate power and authority
necessary to execute and deliver this Agreement, the Indenture and the
Securities and to
-3-
<PAGE>
perform its obligations hereunder and thereunder; the execution,
delivery and performance of this Agreement, the Indenture and the
Securities by First Union and compliance with the provisions hereof and
thereof by First Union will not constitute a breach of or default
under, the corporate charter or by-laws of First Union, or any material
agreement, indenture or other instrument relating to indebtedness for
money borrowed to which First Union is a party, or, to the best of
First Union's knowledge, any law, order, rule, regulation or decree of
any court, governmental agency or authority located in the United
States having jurisdiction over First Union or any property of First
Union, which breach or default would be reasonably likely to have a
material adverse effect on First Union and its subsidiaries taken as a
whole; and, no consent, authorization or order of, or filing or
registration with, any court or governmental agency or authority is
required for the execution, delivery and performance of this Agreement,
the Indenture and the Securities by First Union except such as have
been made or obtained or will be made or obtained on or before the
Closing Date (as defined in Section 3) and except such as may be
required under applicable state securities or "blue sky" laws.
2. Purchase and Sale. Subject to the terms and conditions and
in reliance upon the representations and warranties herein set forth, First
Union agrees to sell to each Underwriter, and each Underwriter agrees, severally
and not jointly, to purchase from First Union, at the purchase price set forth
in Schedule I hereto, the principal amount of the Securities set forth opposite
such Underwriter's name in Schedule II hereto.
3. Delivery and Payment. Delivery of and payment for the
Securities shall be made at the office, on the date and at the time specified in
Schedule I hereto, which date and time may be postponed by agreement between the
Represen tatives and First Union (such date and time of delivery of and payment
for the Securities being herein called the "Closing Date"). Delivery of the
Securities shall be made to the Representatives for the respective accounts of
the several Underwriters against payment by the several Underwriters through
the Representatives of the purchase price thereof to or upon the order of First
Union in the manner and type of funds specified in Schedule I. Certificates for
-4-
<PAGE>
the Securities shall be registered in such names and in such denominations as
the Representatives may request not less than one full business day in advance
of the Closing Date.
First Union agrees to have the Securities available for
inspection, checking and packaging in New York, New York, on the business day
prior to the Closing Date.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the Securities for sale as set forth in the
Prospectus.
5. Agreements. First Union agrees with the several
Underwriters that:
(a) First Union will cause the Prospectus to be filed, or
transmitted for filing, with the Commission pursuant to Rule 424 under
the Act and will promptly advise the Representatives when the
Prospectus has been so filed or transmitted for filing, and, prior to
the termination of the offering of the Securities to which such
Prospectus relates, also will promptly advise the Representatives (i)
when any amendment to the Registration Statement has become effective
or any further supplement to the Prospectus has been so filed or
transmitted for filing, (ii) of any request by the Commission for any
amendment of the Registration Statement or the Prospectus or for any
additional information, (iii) of the issuance by the Commission of any
stop order suspending the effectiveness of the Registration Statement
or the institution or threatening of any proceeding for that purpose,
and (iv) of the receipt by First Union of any notification with respect
to the suspension of the qualification of the Securities for sale in
any jurisdiction or the initiation or threatening of any proceeding for
such purpose. First Union will use its reasonable best efforts to
prevent the issuance of any such stop order and, if issued, to obtain
as soon as reasonably possible the withdrawal thereof. For so long as a
prospectus relating to the Securities is required to be delivered under
the Act, First Union will not file or transmit for filing any amendment
to the Registration Statement or supplement to the Prospectus which
relates to the Securities unless First Union has furnished you or
counsel for the Underwriters a copy for your review prior to filing or
transmission for filing.
-5-
<PAGE>
(b) If, at any time when a prospectus relating to the
Securities is required to be delivered under the Act, any event occurs
as a result of which the Prospectus as then amended or supplemented
would include any untrue statement of a material fact or omit to state
any material fact necessary to make the statements therein in the light
of the circumstances under which they were made not misleading, or if
it shall be necessary to amend or supplement the Prospectus in
connection with the sale of the Securities to comply with the Act or
the rules and regulations of the Commission thereunder, promptly after
becoming aware thereof, First Union will notify the Representatives or
counsel for the Underwriters and, upon their or its reasonable request,
prepare and file or transmit for filing with the Commission an
amendment or supplement which will correct such statement or omission
or effect such compliance.
(c) First Union will make generally available to its security
holders and to the Representatives as soon as practicable, but not
later than 45 days after the end of the 12-month period beginning at
the end of the fiscal quarter of First Union during which the filing,
or transmission for filing, of the Prospectus pursuant to Rule 424
under the Act occurs (except not later than 90 days after the end of
such period if such quarter is the last fiscal quarter), an earnings
statement (which need not be audited) of First Union and its subsidi-
aries, covering such 12-month period, which will satisfy the provisions
of Section 11(a) of the Act.
(d) First Union will use its best efforts to furnish in New
York City to each of the Underwriters prior to 10:00 a.m., New York
City time, on the New York business day next succeeding the date of
this Agreement and from time to time, as many copies of the Prospectus,
each related preliminary prospectus supplement and all amendments of
and supplements to such documents as may be reasonably requested.
(e) First Union will pay all expenses incident to the
performance of its obligations under this Agreement, and will pay the
expenses of printing and filing all documents relating to the offering
and mailing and delivering such to Underwriters and dealers, any filing
fee incident to any required review by the National
-6-
<PAGE>
Association of Securities Dealers, Inc. of the terms of the sale of the
Securities, all expenses in connection with the qualification of the
Securities for offering and sale under state securities laws (including
the fees and disbursements of counsel to the Underwriters in connection
with such qualification and the preparation of the Blue Sky and legal
investment surveys), any taxes payable in connection with the sale and
delivery of the Securities by First Union to the Underwriters, and any
fees charged for rating the Securities.
(f) First Union will use its reasonable best efforts to
arrange for the qualification of the Securities for sale under the laws
of such jurisdictions as the Representatives may designate and to
maintain such qualifications in effect so long as required for the
distribution of the Securities; provided that First Union shall not be
required to qualify to do business in any jurisdiction where it is not
now qualified or to take any action which would subject it to general
or unlimited service of process in any jurisdiction where it is not now
so subject.
(g) During the period beginning from the date of this
Agreement and continuing until the Closing Date or such longer period
as may be agreed to by First Union and set forth in Schedule I hereto
relating to the Securities, First Union will not offer, sell, contract
to sell or otherwise dispose of any of its debt securities which mature
more than one year after the Closing Date and which are substantially
similar to the Securities without the prior written consent of the
Representatives.
6. Conditions to the Obligations of the Under writers. The
obligations of the Underwriters to purchase the Securities shall be subject to
the accuracy in all material respects of the representations and warranties on
the part of First Union contained herein as of the date hereof and the Closing
Date, to the accuracy in all material respects of the statements of First Union
made in any certificates pursuant to the provisions hereof, to the per formance
in all material respects by First Union of its obligations hereunder and to the
following additional conditions:
-7-
<PAGE>
(a) No stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for
that purpose shall have been instituted and be pending or have been
threatened as of the Closing Date; and all requests for additional
informa tion on the part of the Commission shall have been complied
with.
(b) First Union shall have furnished to the Representatives a
certificate, dated the Closing Date, of First Union, signed by the
principal financial or accounting officer of First Union, to the effect
that, to the best of his knowledge after reasonable investigation:
(i) The representations and warranties of First Union
in this Agreement are true and correct in all material
respects on and as of the Closing Date with the same effect as
if made on the Closing Date and First Union has complied with
all the agreements and satisfied all the conditions on its
part to be performed or satisfied at or prior to the Closing
Date, in all material respects;
(ii) No stop order suspending the effective ness of the
Registration Statement has been issued and no proceedings for
that purpose have been instituted and are pending or have been
threatened as of such date;
(iii) Since the date of the most recent financial
statements included in the Prospectus, there has been no
material adverse change in the financial position, results of
operations, cash flows or prospects relating thereto of First
Union and its subsidiaries consolidated, except as set forth
in or contemplated by the Prospectus; and
(iv) Since the date of this Agreement, (A) no downgrading
has occurred in the rating accorded First Union's unsecured
debt securities or preferred stock as described in Section
6(h)(i) and (B) no announcement has been made with respect to
any rating accorded First Union's unsecured debt securities or
preferred stock as described in Section 6(h)(ii).
-8-
<PAGE>
(c) First Union shall have furnished to the Underwriters the
opinion, dated the Closing Date, of Marion A. Cowell, Jr., Executive
Vice President, Secretary and General Counsel of First Union, to the
effect that:
(i) First Union has been duly incorporated and is
validly existing as a corporation in good standing under the
laws of the State of North Carolina, with corporate power and
authority under such laws to own its material properties and
to conduct its business substantially as described in the
Prospectus;
(ii) The Securities have been duly authorized, executed,
issued and delivered and, assuming authentication by the
Trustee in the manner contemplated in its certificate,
constitute valid and legally binding obligations of First
Union entitled to the benefits provided by the Indenture; and
the Securities and the Indenture conform in all material
respects to the descriptions thereof in the Prospectus as
amended or supplemented;
(iii) The Indenture has been duly authorized, executed and
delivered by First Union, has been duly qualified under the
Trust Indenture Act and constitutes a valid and legally
binding obligation of First Union enforceable in accordance
with its terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors'
rights and to general equity principles;
(iv) First Union has all corporate power and authority
necessary to execute and deliver this Agreement, the Indenture
and the Securities, and to perform its obligations hereunder
and there under; this Agreement has been duly authorized,
executed and delivered by First Union; the execution,
delivery and performance of this Agreement, the Indenture, and
the Securities by First Union and compliance with the
provisions hereof and thereof by First Union will not
constitute a breach of or default under, the corporate charter
-9-
<PAGE>
or by-laws of First Union, or any material agree ment,
indenture or other instrument relating to indebtedness for
money borrowed known to such counsel to which First Union is a
party, or, to the best of such counsel's knowledge, any law,
order, rule, regulation or decree of any court, governmental
agency or authority located in the United States having
jurisdiction over First Union or any property of First Union,
which breach or default would be reasonably likely to have a
material adverse effect on First Union and its subsidiaries
taken as a whole; and no consent, authorization or order of,
or filing or registration with, any court or governmental
agency is required for the execution, delivery and performance
of this Agreement, the Indenture or the Securities by First
Union except such as may be required under applicable state
securities or "blue sky" laws or as have been duly made or
obtained; and
(v) The Registration Statement has become effective
under the Act, and, to the best of the knowledge of such
counsel, no stop order sus pending the effectiveness of the
Registration Statement has been issued and no proceedings for
that purpose have been instituted or are pending or threatened
under the Act, and each part of the Registration Statement,
when such part became effective, any amendments thereof filed
prior to the date of this Agreement, as of their respective
effective dates, and the Registration Statement and the
Prospectus, as of the date of the Prospectus Supplement, and
each amendment thereof or supplement thereto, as of their
respective effective or issue dates, appeared on their face to
be appropriately responsive in all material respects to the
requirements of the Act, the Trust Indenture Act and the
respective rules and regulations of the Commission
thereunder; such counsel has no reason to believe that any
part of the Registration Statement, when such part became
effective, contained any untrue statement of a material fact
or omitted to state any material fact required to be stated
therein or necessary to make the statements therein not
misleading, or that the Prospectus, as of the date of the
-10-
<PAGE>
Prospectus Supplement, or any amendments thereof or
supplements thereto, as of their respective effective or issue
dates, contained any untrue statement of a material fact or
omitted to state any material fact necessary to make the
statements therein, in the light of the circumstances under
which they were made, not misleading, or that, as of the
Closing Date, either the Prospectus or any further amendment
or supplement thereto made by the Company prior to the Closing
Date contained any untrue statement of a material fact or
omitted to state any material fact necessary to make the
statements therein, in the light of the circumstances under
which they were made, not misleading; it being understood that
such counsel need express no opinion as to the Statement of
Eligibility (Form T-1) under the Trust Indenture Act of the
Trustee, as to the financial statements or other financial
data contained in any part of the Registration Statement or
the Prospectus, as to any statements or omissions made in
reliance upon or in conformity with information furnished in
writing to First Union by or on behalf of an Underwriter for
use therein.
As to those matters which relate to the Trustee, such counsel
may rely upon the certificate or certificates of such Trustee, and as
to matters governed by New York law, upon the opinion of Sullivan &
Cromwell.
(d) The Representatives shall have received from Sullivan &
Cromwell, counsel for the Underwriters, such opinion or opinions, dated
the Closing Date, with respect to such matters as the Representatives
may reasonably require.
As to matters governed by North Carolina law,
Sullivan & Cromwell may rely upon the opinion of
Marion A. Cowell, Jr. delivered pursuant to
Section 6(c).
(e) KPMG Peat Marwick LLP, as independent accountants of First
Union, shall have furnished to the Representatives a letter, dated as
of the Closing Date, to the effect set forth in Schedule III hereto.
-11-
<PAGE>
(f) Subsequent to the date hereof, there shall not have
occurred any change, or any development involving a prospective change,
in or affecting the financial position, long-term debt, stockholders'
equity or results of operations of First Union and its consolidated
subsidiaries which the Representatives conclude, after consultation
with First Union, in the judgment of the Representatives is so material
and adverse as to make it impractical or inadvisable to proceed with
the public offering or the delivery of the Securities as contemplated
by the Prospectus.
(g) First Union shall have furnished to the Representatives
such further information, certificates and documents as they may
reasonably request prior to the Closing Date.
(h) Subsequent to the date of this Agreement, (i) no
downgrading shall have occurred in the rating accorded First Union's
unsecured debt securities or preferred stock by Standard & Poor's
Ratings Group or by Moody's Investors Service, Inc. and (ii) neither
such organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating
of any of First Union's unsecured debt securities or preferred stock.
If any of the conditions specified in this Section 6 shall not
have been fulfilled in all material respects when and as provided in this
Agreement, or if any of the opinions and certificates mentioned above or
elsewhere in this Agreement shall not be in all material respects reasonably
satisfactory in form and substance to the Representatives and their counsel,
this Agreement and all obligations of the Underwriters hereunder may be canceled
at, or at any time prior to, the Closing Date by the Representatives. Notice of
such cancellation shall be given to First Union in writing or by telephone or
telegraph confirmed in writing.
7. Indemnification and Contribution. (a) First Union agrees to
indemnify and hold harmless each Underwriter and each person who controls any
Underwriter within the meaning of either the Act or the Exchange Act against any
and all losses, claims, damages or liabilities, joint or several, to which they
or any of them may become subject under the Act, the Exchange Act or other
Federal or state
-12-
<PAGE>
statutory law or regulation, at common law or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon any untrue statement or alleged untrue statement of a material
fact contained in the registration statement or in any amendment thereof filed
prior to the date hereof, or in the Registration Statement or the Prospectus, or
in any amendment thereof or supplement thereto, or in any related preliminary
prospectus or preliminary prospectus supplement, or arise out of or are based
upon 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 agrees to reimburse each such indemnified party for any legal or other
expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however,
that (i) First Union will not be liable in any such case to the extent that any
such loss, claim, damage or liability arises out of or is based upon any such
untrue statement or alleged untrue statement or omission or alleged omission
made therein in reliance upon and in con formity with written information
furnished to First Union by or on behalf of any Underwriter through the
Representatives specifically for use in the Prospectus or any supplement thereto
or any related preliminary prospectus or preliminary prospectus supplement or of
the Statement of Eligibility (Form T-1) under the Trust Indenture Act of the
Trustee, and (ii) such indemnity with respect to any related preliminary
prospectus or preliminary prospectus supplement shall not inure to the benefit
of any Underwriter (or any person controlling such Underwriter) from whom the
person asserting any such loss, claim, damage or liability purchased the
Securities which are the subject thereof if such person was not sent or given a
copy of the Prospectus (or the Prospectus as amended or supplemented), excluding
documents incorporated therein by reference, at or prior to the confirmation of
the sale of such Securities to such person in any case where such delivery is
required by the Act and the untrue statement or omission of a material fact
contained in such related preliminary prospectus or preliminary prospectus
supplement was corrected in the Prospectus (or the Prospectus as amended or
supplemented). This indemnity agreement will be in addition to any liability
which First Union may otherwise have.
(b) Each Underwriter severally agrees to indemnify and hold
harmless First Union, each of its directors,
-13-
<PAGE>
each of its officers who signs the Registration Statement, and each person who
controls First Union within the meaning of either the Act or the Exchange Act,
to the same extent as the foregoing indemnity from First Union to each Under
writer, but only with reference to written information furnished to First Union
by or on behalf of such Underwriter through the Representatives specifically for
use in the Prospectus or any supplement thereto or any related preliminary
prospectus or preliminary prospectus supplement. This indemnity agreement will
be in addition to any liability which any Underwriter may otherwise have.
(c) Promptly after receipt by an indemnified party under
Section 7(a) or (b) of notice of the commence ment of any action, such
indemnified party will, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party will not relieve the indem nifying party from any liability
which it may have to any indemnified party otherwise than under Section 7(a) or
(b). In case any such action is brought against any indemnified party, and it
notifies the indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate therein, and to the extent that it may
elect by written notice delivered to the indemnified party promptly after
receiving the aforesaid notice from such indemnified party, to assume the
defense thereof, with counsel satisfactory to such indemnified party; provided
that, if the defendants in any such action include both the indemnified party
and the indemnifying party and the indem nified party shall have reasonably
concluded that there may be legal defenses available to it and/or other
indemnified parties which are different from or additional to those available to
the indemnifying party, the indemnified party or parties shall have the right to
select separate counsel to assert such legal defenses and to otherwise
participate in the defense of such action on behalf of such indemnified party or
parties. Upon receipt of notice from the indemni fying party to such indemnified
party of its election so to assume the defense of such action and approval by
the indemnified party of counsel, the indemnifying party will not be liable to
such indemnified party under Section 7(a) or (b) for any legal or other expenses
subsequently incurred by such indemnified party (other than reasonable costs of
investigation) in connection with the defense thereof unless (i) the indemnified
party shall have employed separate
-14-
<PAGE>
counsel in connection with the assertion of legal defenses in accordance with
the proviso to the next preceding sentence (it being understood, however, that
the indemnifying party shall not be liable for the expenses of more than one
separate national counsel, approved by the Representatives, representing the
indemnified parties who are parties to such action), (ii) the indemnifying party
shall not have employed counsel satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after notice of
commencement of the action or (iii) the indemnifying party has authorized the
employment of counsel for the indemnified party at the expense of the
indemnifying party; and except that, if clause (i) or (iii) is applicable, such
liability shall be only in respect of the counsel referred to in such clause (i)
or (iii).
(d) If the indemnification provided for in this Section 7 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by First Union on the one hand and the Underwriters
of the Securities on the other from the offering of the Securities to which such
loss, claim, damage or liability (or action in respect thereof) relates. If,
however, the allocation provided by the immediately preceding sentence is not
permitted by appli cable law or if the indemnified party failed to give the
notice required under subsection (c) above, then each indemnifying party shall
contribute to such amount paid or payable by such indemnified party in such
proportion as is appropriate to reflect not only such relative benefits but also
the relative fault of First Union on the one hand and the Underwriters of the
Securities on the other in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities (or actions in respect
thereof), as well as any other relevant equitable considerations. The relative
benefits received by First Union on the one hand and such Underwriters on the
other shall be deemed to be in the same proportion as the total net proceeds
from such offering (before deducting expenses) received by First Union bear to
the total underwriting discounts and commissions received by such Underwriters.
-15-
<PAGE>
The relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by First Union on the one hand or such Underwriters on the other and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission. First Union and the Under
writers agree that it would not be just and equitable if contribution pursuant
to this subsection (d) were determined by pro rata allocation (even if the
Underwriters were treated as one entity for such purpose) or by any other method
of allocation which does not take account of the equitable considerations
referred to above in this subsec tion (d). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or lia bilities (or
actions in respect thereof) referred to above in this subsection (d) shall be
deemed to include 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 subsection (d), no Underwriter
shall be required to contri bute any amount in excess of the amount by which the
total price at which the applicable Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The obligations of the Under
writers of Securities in this subsection (d) to contribute are several in
proportion to their respective underwriting obligations with respect to the
Securities and not joint.
8. Termination. This Agreement shall be subject to termination
in the absolute discretion of the Representatives, by notice given to First
Union prior to delivery of and payment for the Securities, if prior to such time
(i) trading in securities generally on the New York Stock Exchange shall have
been suspended or materially limited, (ii) a general moratorium on commercial
banking activities in New York shall have been declared by either Federal or New
York State authorities, or (iii) there shall have occurred any material outbreak
or escalation of hostilities or other calamity or crisis the effect of which on
the
-16-
<PAGE>
financial markets of the United States is such as to make it, in the reasonable
judgment of the Representatives, impracticable or inadvisable to proceed with
the public offering or the delivery of the Securities as contemplated by the
Prospectus.
9. Substituted Underwriters. If, on the Closing Date, any one
or more of the Underwriters shall fail or refuse to purchase Securities that it
or they have agreed to purchase hereunder on such date, and the aggregate number
of Securities which such defaulting Underwriter or Underwriters agreed but
failed or refused to purchase is not more than one-tenth of the aggregate number
of the Securities to be purchased on the Closing Date, the other Underwriters
shall be obligated severally in the proportions that the number of Securities
set forth opposite their respective names in Schedule II bears to the aggregate
number of Securities set forth opposite the names of all such non-defaulting
Underwriters, or in such other proportions as the Underwriters may agree, to
purchase the Securities which such defaulting Underwriter or Underwriters agreed
but failed or refused to purchase on the Closing Date; provided that in no event
shall the number of Securities that any Underwriter has agreed to purchase
pursuant to Section 2 above be increased pursuant to this Section 9 by an amount
in excess of one-ninth of such number of Securities without the written consent
of such Underwriter. If, on the Closing Date, any Underwriter or Underwriters
shall fail or refuse to purchase Securities and the aggregate number of
Securities with respect to which such default occurs is more than one-tenth of
the aggregate number of Securities to be purchased on the Closing Date, and
arrangements satisfactory to the Underwriters and First Union for the purchase
of such Securities are not made within 36 hours after such default, this
Agreement shall terminate without liability on the part of any non-defaulting
Underwriter or First Union. In such case either the Underwriters or First Union
shall have the right to postpone the Closing Date, but in no event for longer
than seven days, in order that the required changes, if any, in the Registration
Statement and in the Prospectus or in any other documents or arrangements may be
effected. Any action taken under this Section 9 shall not relieve any defaulting
Underwriter from liability in respect of any default of such Underwriter under
this Agreement.
-17-
<PAGE>
10. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of
First Union or its officers and of the Underwriters set forth in or made pursu
ant to this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter or First Union or any of
the officers, directors or controlling persons referred to in Section 7 hereof,
and will survive delivery of and payment for the Securities. The provisions of
Sections 5(e), 7, 9, 11, 12 and 13 hereof shall survive the termination or
cancellation of this Agreement.
11. Successors. This Agreement will inure to the benefit of
and be binding upon the parties hereto (including any Underwriter or
Underwriters added pursuant to Section 9 hereof) and their respective
successors, heirs, executors, administrators and the officers and directors and
controlling persons referred to in Section 7 hereof, and no other person will
have any right or obligation hereunder.
12. APPLICABLE LAW. THIS AGREEMENT WILL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
13. Counterparts; Notices. This Agreement may be signed in any
number of counterparts, each of which shall be deemed an original, which taken
together shall constitute one and the same instrument.
All notices hereunder shall be in writing or by telegram if
promptly confirmed in writing, and if to the Underwriters shall be sufficient in
all respects if delivered or sent by registered mail to the address of the
Representatives as set forth in Schedule I hereto; and if to First Union shall
be sufficient in all respects if delivered or sent by registered mail to the
address of First Union set forth in the Registration Statement, Attention:
Secretary; provided, however, that any notice to an Underwriter pursuant to
Section 7 (c) hereof shall be delivered or sent by registered mail to such
Underwriter at its address set forth in its Underwriters' Questionnaire, or
telex constituting such Questionnaire, which address will be supplied to First
Union by the Representatives upon request.
14. Action by Underwriters. Any action under this Agreement
taken by the Underwriters jointly or by the
-18-
<PAGE>
firm signing below on behalf of you as the Representatives will be binding upon
all the Underwriters.
-19-
<PAGE>
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding agreement
between First Union and the Underwriters.
Very truly yours,
FIRST UNION CORPORATION
----------------------------
Name:
Title:
The foregoing Agreement is hereby confirmed and accepted as of the date first
above written.
By: [Representatives]
On behalf of the Underwriters
set forth in Schedule II
By: ______________________________
Name:
Title:
-20-
<PAGE>
SCHEDULE I
TITLE OF DESIGNATED SECURITIES:
[____%] [[Senior] [Subordinated]] [[Debentures] [Notes]]
Due _________ __,____
AGGREGATE PRINCIPAL AMOUNT:
$_____________
PRICE TO PUBLIC:
____% of the principal amount of the Designated
Securities[, plus accrued interest from _________ __,
____]
PURCHASE PRICE BY UNDERWRITERS:
____% of the principal amount of the Designated
Securities[, plus accrued interest, if any, from
_________ __, ____]
SPECIFIED FUNDS FOR PAYMENT OF PURCHASE PRICE:
Immediately available funds by wire
INDENTURE:
Indenture, dated as of ________ __, ____, between First Union and
__________, as [Successor] Trustee, as amended
MATURITY:
________ __, ____
INTEREST RATE:
[_____% per annum] [describe floating rate provisions]
INTEREST PAYMENT DATES:
________ __ and ________ __ of each year, commencing
________ __, ____
-21-
<PAGE>
REGULAR RECORD DATES:
________ __ and ________ __ of each year, commencing
________ __, ____
REPAYMENT PROVISIONS:
[Describe repayment provisions, if any]
REDEMPTION PROVISIONS:
[Describe redemption provisions, if any]
SINKING FUND PROVISIONS:
[Describe sinking fund provisions, if any]
CONVERSION PROVISIONS:
[Describe conversion provisions, if any]
EXCHANGE PROVISIONS:
[Describe exchange provisions, if any]
OTHER TERMS:
[Describe additional terms, if any]
ADDITIONAL COMFORT LETTER COVERAGE:
[Describe additional coverage, if any]
FORM OF DESIGNATED SECURITY:
[Global] [Certificated] in denominations set forth in
the Prospectus Supplement
CLOSING DATE:
________ __, ____ at [time]
RESTRICTED PERIOD UNDER SECTION 5(G) OF UNDERWRITING
AGREEMENT:
[Describe period if other than through Closing Date]
-22-
<PAGE>
OFFICE FOR DELIVERY OF DESIGNATED SECURITIES:
[insert address]
OFFICE FOR PAYMENT FOR DESIGNATED SECURITIES:
[insert address]
NAME OF REPRESENTATIVES:
[insert names]
ADDRESS FOR NOTICES, ETC.:
[insert address]
-23-
<PAGE>
SCHEDULE II
Principal
Amount of
Securities
to be
Underwriter Purchased
$
[underwriters names]
TOTAL $
<PAGE>
SCHEDULE III
Pursuant to Section 6(e) of the Underwriting Agreement, the
independent accountants of First Union shall provide a comfort letter to the
effect that:
(i) They are independent certified public accountants with
respect to First Union and its subsidiaries within the meaning of the Act and
the applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules examined by them and included
or incorporated by reference in the Prospectus as amended or supplemented comply
as to form in all material respects with the applicable accounting requirements
of the Act or the Exchange Act, as applicable, and the published rules and
regulations thereunder;
(iii) On the basis of limited procedures, not constituting an
audit, consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available interim
financial statements of First Union and its subsidiaries, inspection of the
minute books of First Union and its subsidiaries since the date of the latest
audited financial statements included or incorporated by reference in the
Prospectus as amended or supplemented, inquiries of officials of First Union and
its subsidiaries responsible for financial and accounting matters and such other
inquiries and procedures as may be specified in such letter, nothing came to
their attention that caused them to believe that:
(A) the unaudited consolidated statements of income,
consolidated balance sheets and consolidated statements of changes in
financial position included or incorporated by reference in First
Union's most recent Quarterly Report on Form 10-Q incorporated by
reference in the Prospectus (if any) as amended or supplemented does
not comply as to form in all material respects with the applicable
accounting requirements of the Exchange Act as it applies to Form 10-Q
and the related published rules and regulations thereunder or are not
in conformity with generally accepted accounting principles applied on
a basis substantially consistent with that of the audited consolidated
financial
III-1
<PAGE>
statements included or incorporated by reference in First Union's most
recent Annual Report on Form 10-K;
(B) any unaudited financial data included in the Prospectus as
amended or supplemented as at any time, or for any period ending, after
the end of the latest interim period covered by a Quarterly Report on
Form 10-Q of First Union or year ended for which First Union has filed
an Annual Report on Form 10-K (whichever is more recent) (and any data
for any comparable prior period included therein) do not agree with the
corresponding amounts in the unaudited consolidated financial
statements from which such data are derived, or any such unaudited
financial data were not deter mined on a basis substantially consistent
with the basis for the corresponding amounts in the audited
consolidated financial statements included or incorporated by
reference in First Union's most recent Annual Report on Form 10-K;
(C) the unaudited pro forma consolidated condensed financial
statements (if any) included or incorporated by reference in the
Prospectus do not comply as to form in all material respects with the
applicable accounting requirements of the Act and the published rules
and regulations thereunder or the pro forma adjustments have not been
properly applied to the historical amounts in the compilation of those
state ments;
(D) as of a specified date not more than five days prior to
the date of delivery of such letter there have been any changes in the
capital stock (other than issuances of capital stock upon exercise of
options and stock appreciation rights, upon earn outs of perfor mance
shares and upon conversions of convertible securities, in each case
which were outstanding on the date of the latest audited financial
statements included or incorporated by reference in the Prospectus as
amended or supplemented) or long-term debt of First Union or any of its
subsidiaries, or any decreases in consolidated stockholders' equity,
consolidated assets, consolidated deposits, or allowance for loan
losses of First Union or other items specified by the Representatives,
or any increases in any items specified by the Representatives, in each
case as compared with amounts shown in the latest balance sheet
included or incor-
III-2
<PAGE>
porated by reference in the Prospectus as amended or supplemented
except in each case for changes, increases or decreases which the
Prospectus as amended or supplemented discloses have occurred or may
occur or which are described in such letter; and
(E) for the period from the date of the latest financial
statements included or incorporated by refer ence in the Prospectus as
amended or supplemented to the end of the latest period for which
financial statements are available there were any decreases in
consolidated net interest income, net interest income after provision
for loan losses, or the total or per share amounts of net income of
First Union or other items specified by the Representatives, or any
increases in any items specified by the Representatives, in each case
as compared with the comparable period of the preceding year and with
any other period of corresponding length specified by the
Representatives, except in each case for increases or decreases which
the Prospectus as amended or supplemented discloses have occurred or
may occur or which are described in such letter;
(iv) In addition to the examination referred to in their report(s)
included or incorporated by reference in the Prospectus and the limited
procedures, inspection of minute books, inquiries and other procedures referred
to in subparagraph (iii) above, they have carried out certain specified
procedures, not constituting an audit, with respect to certain amounts,
percentages and financial information specified by the Representatives which are
derived from the general accounting records of First Union and its subsidiaries,
which appear in the Prospectus as amended or supplemented (excluding documents
incorporated by reference), in exhibits to the Registration Statement specified
by the Representatives, or in documents incor porated by reference in the
Prospectus specified by the Representatives, and have compared certain of such
amounts, percentages and financial information with the accounting records of
First Union and its subsidiaries and have found them to be in agreement.
III-3
FIRST UNION CORPORATION
[FIRST UNION NATIONAL BANK OF NORTH CAROLINA],
AS DEPOSITARY
AND
THE HOLDERS FROM TIME TO TIME OF
THE DEPOSITARY RECEIPTS DESCRIBED
HEREIN
-------------------
Deposit Agreement
-------------------
Dated as of ______ __, ____
- 1 -
<PAGE>
TABLE OF CONTENTS
Page
PARTIES.......................................................................1
RECITALS......................................................................1
ARTICLE I
DEFINITIONS
"Amendment"...................................................................2
"Company".....................................................................2
"Deposit Agreement"...........................................................2
"Depositary"..................................................................2
"Depositary Shares"...........................................................2
"Depositary's Agent"..........................................................2
"Depositary's Office".........................................................2
"Receipt".....................................................................2
"record holder"...............................................................3
"Registrar"...................................................................3
"Stock" .....................................................................3
ARTICLE II
FORM OF RECEIPTS; DEPOSIT OF STOCK; EXECUTION AND DELIVERY,
TRANSFER, SURRENDER AND REDEMPTION OF RECEIPTS
SECTION 2.01. [BOOK-ENTRY FORM;] FORM AND TRANSFER OF
RECEIPTS.............................................................3
SECTION 2.02. DEPOSIT OF STOCK; EXECUTION AND DELIVERY OF
RECEIPTS IN RESPECT THEREOF..........................................8
SECTION 2.03. REDEMPTION OF STOCK...........................................10
SECTION 2.04. REGISTRATION OF TRANSFER OF RECEIPTS..........................13
SECTION 2.05. SPLIT-UPS AND COMBINATIONS OF RECEIPTS;
SURRENDER OF RECEIPTS AND WITHDRAWAL OF STOCK.......................14
SECTION 2.06. LIMITATIONS ON EXECUTION AND DELIVERY,
TRANSFER, SURRENDER AND EXCHANGE OF RECEIPTS........................17
SECTION 2.07. LOST RECEIPTS, ETC............................................18
SECTION 2.08. CANCELLATION AND DESTRUCTION OF SURRENDERED
RECEIPTS............................................................18
SECTION 2.__. STOCK PURCHASE PLANS..........................................20
- i -
<PAGE>
Page
ARTICLE III
CERTAIN OBLIGATIONS OF THE HOLDERS
OF RECEIPTS AND THE COMPANY
SECTION 3.01. FILING PROOFS, CERTIFICATES AND OTHER
INFORMATION.........................................................21
SECTION 3.02. PAYMENT OF TAXES OR OTHER GOVERNMENTAL CHARGES.
21
SECTION 3.03. WARRANTY AS TO STOCK..........................................22
ARTICLE IV
THE DEPOSITED SECURITIES; NOTICES
SECTION 4.01. CASH DISTRIBUTIONS.................23
SECTION 4.02. DISTRIBUTIONS OTHER THAN CASH.................................23
SECTION 4.03. SUBSCRIPTION RIGHTS, PREFERENCES OR PRIVILEGES.
25
SECTION 4.04. NOTICE OF DIVIDENDS, ETC.; FIXING OF RECORD
DATE FOR HOLDERS OF RECEIPTS........................................27
SECTION 4.05. VOTING RIGHTS.................................................28
SECTION 4.06. CHANGES AFFECTING DEPOSITED SECURITIES AND
RECLASSIFICATIONS, RECAPITALIZATIONS, ETC...........................29
SECTION 4.07. INSPECTION OF REPORTS.........................................31
SECTION 4.08. LIST OF RECEIPT HOLDERS.......................................31
ARTICLE V
THE DEPOSITARY, THE DEPOSITARY'S AGENTS,
THE REGISTRAR AND THE COMPANY
SECTION 5.01. MAINTENANCE OF OFFICES, AGENCIES AND TRANSFER
BOOKS BY THE DEPOSITARY; REGISTRAR..................................31
SECTION 5.02. PREVENTION OF OR DELAY IN PERFORMANCE BY THE
DEPOSITARY, THE DEPOSITARY'S AGENTS, THE REGISTRAR OR THE
COMPANY.............................................................33
SECTION 5.03. OBLIGATIONS OF THE DEPOSITARY, THE DEPOSITARY'S
AGENTS, THE REGISTRAR AND THE COMPANY...............................34
SECTION 5.04. RESIGNATION AND REMOVAL OF THE DEPOSITARY:
APPOINTMENT OF SUCCESSOR DEPOSITARY.................................36
SECTION 5.05. CORPORATE NOTICES AND REPORTS.................................37
SECTION 5.06. INDEMNIFICATION BY THE COMPANY................................38
- ii -
<PAGE>
Page
SECTION 5.07. CHARGES AND EXPENSES..........................................39
ARTICLE VI
AMENDMENT AND TERMINATION
SECTION 6.01. AMENDMENT.....................................................40
SECTION 6.02. TERMINATION...................................................40
ARTICLE VII
MISCELLANEOUS
SECTION 7.01. COUNTERPARTS.................................................42
SECTION 7.02. EXCLUSIVE BENEFIT OF PARTIES..................................43
SECTION 7.03. INVALIDITY OF PROVISIONS......................................43
SECTION 7.04. NOTICES.......................................................43
SECTION 7.05. DEPOSITARY'S AGENTS...........................................45
SECTION 7.06. HOLDERS OF RECEIPTS ARE PARTIES...............................45
SECTION 7.07. GOVERNING LAW.................................................45
SECTION 7.08. INSPECTION OF DEPOSIT AGREEMENT...............................45
SECTION 7.09. HEADINGS......................................................46
TESTIMONIUM..................................................................46
SIGNATURES...................................................................46
EXHIBIT A: Depositary Receipt
- iii -
<PAGE>
DEPOSIT AGREEMENT
dated as of ______ __, ____
among
FIRST UNION CORPORATION
a North Carolina corporation,
[FIRST UNION NATIONAL BANK OF NORTH CAROLINA]
a national banking association, as Depositary,
AND THE HOLDERS FROM TIME TO TIME
OF THE RECEIPTS DESCRIBED HEREIN
WHEREAS, it is desired to provide, as hereinafter set forth in
this Deposit Agreement, for the deposit of shares of Series __ [__%] [Class A]
Preferred Stock, no-par value, of FIRST UNION CORPORATION with the Depositary
(as hereinafter defined) for the purposes set forth in this Deposit Agreement
and for the issuance hereunder of Receipts (as hereinafter defined) by the
Depositary evidencing Depositary Shares in respect of the Stock (as hereinafter
defined) so deposited;
NOW, THEREFORE, in consideration of the premises contained
herein and such other good and valuable consideration, receipt of which is
hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
The following definitions shall for all purposes, unless
otherwise indicated, apply to the respective terms used in this Deposit
Agreement and the Receipts:
- 1 -
<PAGE>
"Amendment" shall mean the articles of amendment to the
Articles of Incorporation, as amended, of the Company filed with the Secretary
of State of the State of North Carolina establishing the Stock as a series of
preferred stock of the Company.
"Company" shall mean First Union Corporation, a North Carolina
corporation, and its successors.
"Deposit Agreement" shall mean this Deposit Agreement, as
amended or supplemented from time to time in accordance with the terms hereof.
"Depositary" shall mean First Union National Bank of North
Carolina, a national banking association, and any successor Depositary
hereunder.
"Depositary Shares" shall mean the Depositary Shares, each
representing a one-________ (1/__th) interest in a share of Stock and which
shall be evidenced by Receipts.
"Depositary's Agent" shall mean an agent appointed
by the Depositary pursuant to Section 7.05.
"Depositary's Office" shall mean the principal office of the
Depositary at which at any particular time its depositary business shall be
administered.
"Receipt" shall mean one of the depositary receipts, whether
in definitive or temporary form, issued hereunder by the Depositary, each
representing any number of whole Depositary Shares. [If Receipts are to be
issued in Book- Entry Form: If the context so requires, the term "Receipt"
- 2 -
<PAGE>
shall be deemed to include the DTC Receipt (as defined in Section 2.01 hereof).]
"record holder" with respect to a Receipt shall mean the
individual, entity or person in whose name a Receipt is registered on the books
of the Depositary or any register of any Registrar maintained for such purpose
at a given time.
"Registrar" shall mean any bank or trust company which shall
be appointed by the Depositary to register ownership and transfers of Receipts
as herein provided and which may include the Depositary.
"Securities Act" shall mean the Securities Act of
1933, as amended.
"Stock" shall mean shares of the Company's Series __ [___%]
[Class A] Preferred Stock, no-par value.
ARTICLE II
FORM OF RECEIPTS; DEPOSIT OF STOCK; EXECUTION AND DELIVERY,
TRANSFER, SURRENDER AND REDEMPTION OF RECEIPTS
[Use bracketed portions only if Receipts are to be issued in
Book-Entry Form:] SECTION 2.01. [BOOK-ENTRY FORM;] FORM AND TRANSFER OF
RECEIPTS. [[All] [A portion] of the Receipts shall initially be represented by
one or more global receipts (collectively, the "DTC Receipt") deposited with The
Depository Trust Company ("DTC") and registered in the name of [Cede & Co.], a
nominee of DTC. The Depositary, or such other entity as is agreed to by DTC, may
hold the DTC Receipt as custodian for DTC. So long as the Receipts are eligible
for
- 3 -
<PAGE>
book-entry settlement with DTC, except as provided for in Section 2.09 hereof,
no person acquiring Depositary Shares traded on any securities exchange with
book-entry settlement through DTC shall receive or be entitled to receive
physical delivery of the Receipts evidencing such Depositary Shares. Ownership
of beneficial interests in the DTC Receipt shall be shown on, and the transfer
of such ownership shall be effected through, records maintained by (i) DTC or
its nominee for such DTC Receipt, or (ii) institutions that have accounts with
DTC.]
[If DTC subsequently ceases to make its book-entry settlement
system available for the Receipts, the Company may instruct the Depositary
regarding making other arrangements for book-entry settlement. In the event that
the Receipts are not eligible for, or it is no longer necessary to have the
Receipts available in, book-entry form, the Depositary shall provide written
instructions to DTC to deliver to the Depositary for cancellation the DTC
Receipt, and the Company shall instruct the Depositary to deliver to the
beneficial owners of the Depositary Shares previously evidenced by the DTC
Receipt definitive receipts in physical form evidencing such Depositary Shares.
Such definitive Receipts shall be in the form annexed hereto as Exhibit A with
appropriate insertions, modifications and omissions, as hereafter provided.]
The beneficial owners of Depositary Shares shall [, except as
stated above with respect to Depositary Shares in
- 4 -
<PAGE>
book-entry form represented by the DTC Receipt,] be entitled to receive Receipts
in physical, certificated form as herein provided.
[The Receipts may be typewritten in the case of the DTC
Receipts and otherwise shall, upon notice by the Company to the Depositary, be
definitive Receipts.] Definitive Receipts shall be engraved or printed or
lithographed on steel-engraved borders and shall be substantially in the form
annexed hereto as Exhibit A, with appropriate insertions, modifications and
omissions, as hereinafter provided. [If Receipts are to be issued in Book-Entry
Form: The DTC Receipt shall bear such legend or legends as may be required by
DTC in order for it to accept the Depositary Shares for its book-entry
settlement system.] Pending the preparation of definitive Receipts, the
Depositary, upon the written order of the Company [If shares of Stock may be
deposited by holders thereof: or any holder of Stock, as the case may be,]
delivered in compliance with Section 2.02, shall execute and deliver temporary
Receipts which shall be printed, lithographed, typewritten, mimeographed or
otherwise substantially of the tenor of the definitive Receipts in lieu of which
they are issued and with such appropriate insertions, omissions, substitutions
and other variations as the persons executing such Receipts may determine, as
evidenced by their execution of such Receipts. After the preparation of
definitive Receipts, the temporary Receipts shall be exchangeable for definitive
Receipts upon surrender of the
- 5 -
<PAGE>
temporary Receipts at the Depositary's Office, without charge to the holder.
Upon surrender for cancellation of any one or more temporary Receipts, the
Depositary shall execute and deliver in exchange therefor definitive Receipts
representing the same number of Depositary Shares as represented by the
surrendered temporary Receipt or Receipts registered in the name (and only the
name) of the holder of the temporary Receipt. Such exchange shall be made at the
Company's expense and without any charge therefor to the holder. Until so
exchanged, the temporary Receipts shall in all respects be entitled to the same
benefits under this Deposit Agreement and with respect to the Stock, as
definitive Receipts.
Receipts shall be executed by the Depositary by the manual
signature of a duly authorized officer of the Depositary; PROVIDED, that such
signature may be a facsimile if a Registrar for the Receipts (other than the
Depositary) shall have been appointed and such Receipts are countersigned by
manual signature of a duly authorized officer of the Registrar. No Receipt shall
be entitled to any benefits under this Deposit Agreement or be valid or
obligatory for any purpose unless it shall have been executed manually by a duly
authorized officer of the Depositary or, if a Registrar for the Receipts (other
than the Depositary) shall have been appointed, by facsimile signature of a duly
authorized officer of the Depositary and countersigned manually by a duly
authorized officer of such Registrar. The Depositary shall
- 6 -
<PAGE>
record on its books each Receipt so signed and delivered as hereinafter
provided. Receipts bearing the manual or facsimile signatures of individuals who
were at any time proper officers of the Depositary or the Registrar, as the case
may be, shall constitute adequate signatures hereunder, notwithstanding that
such individuals or any of them have ceased to hold such offices prior to the
delivery of such Receipts or did not hold such offices on the date of delivery
of such Receipts.
Receipts shall be in denominations of any number of whole
Depositary Shares.
Receipts may be endorsed with or have incorporated in the text
thereof such legends or recitals or changes not inconsistent with the provisions
of this Deposit Agreement as may be required by the Depositary and approved by
the Company or required to comply with any applicable law or regulation or with
the rules and regulations of any securities exchange upon which the Stock, the
Depositary Shares or the Receipts may be listed or to conform with any usage
with respect thereto, or to indicate any special limitations or restrictions to
which any particular Receipts are subject.
[Subject to any limitations set forth in a Receipt or in this
Deposit Agreement,] Title to Depositary Shares evidenced by a Receipt which is
properly endorsed, or accompanied by a properly executed instrument of transfer,
shall be transferable by delivery of such Receipt with the same effect as if
such Receipt were a negotiable instrument;
- 7 -
<PAGE>
PROVIDED, HOWEVER, that until transfer of a Receipt shall be registered on the
books of the Registrar, on behalf of the Depositary, as provided in Section
2.04, the Depositary may, notwithstanding any notice to the contrary, treat the
record holder as the absolute owner thereof for the purpose of determining the
person entitled to distributions of dividends or other distributions with
respect to the Stock [, the exchange of Depositary Shares for Stock, the right
to exchange Receipts pursuant to Section 2.09] or to any notice provided for in
this Deposit Agreement and for all other purposes.
The Depositary shall not lend any Stock deposited hereunder.
SECTION 2.02. DEPOSIT OF STOCK; EXECUTION AND DELIVERY OF
RECEIPTS IN RESPECT THEREOF. Subject to the terms and conditions of this Deposit
Agreement, the Company [If shares of Stock may be deposited by holders thereof:
or any holder of Stock] may from time to time deposit shares of Stock with the
Depositary under this Deposit Agreement by delivery to the Depositary of a
certificate or certificates representing the Stock to be deposited. Such
certificate or certificates representing the Stock shall be properly endorsed or
accompanied, if required by the Depositary, by a duly executed instrument of
transfer or endorsement, in form satisfactory to the Depositary, together with
all such certifications as may be required by the Depositary in accordance with
the provisions of this Deposit Agreement, and
- 8 -
<PAGE>
together with a written order of the Company [If shares of Stock may be
deposited by holders thereof: or such holder, as the case may be,] directing the
Depositary to execute and deliver to, or upon the written order of, the person
or persons named in such order, a Receipt or Receipts evidencing in the
aggregate the number of Depositary Shares representing such deposited Stock.
All Stock deposited by the Company [If shares of Stock may be
deposited by holders thereof: or any holder of Stock, as the case may be,] with
the Depositary shall be held by the Depositary at the Depositary's Office or at
such other place or places as the Depositary shall determine.
Upon receipt by the Depositary of a certificate or
certificates representing Stock deposited, with the Depositary by the Company
[If shares of Stock may be deposited by holders thereof: or any holder of Stock,
as the case may be,] in accordance with the provisions of this Section, together
with the other documents required as above specified, and upon recordation of
the Stock so deposited on the books of the Company in the name of the
Depositary, the Depositary shall execute and deliver, to the person or persons
named in the written order delivered to the Depositary, a Receipt or Receipts,
evidencing in the aggregate the number of Depositary Shares relating to the
Stock so deposited. Such Receipt or Receipts shall be registered by the
Depositary or the Registrar in such name or names as may be requested by the
person or persons named in the written order. The Depositary
- 9 -
<PAGE>
shall execute and deliver such Receipts at the Depositary's Office or such other
offices, if any, as such person may designate. Delivery at other offices shall
be at the risk and expense of the person requesting such delivery. [If Receipts
are to be issued in Book-Entry Form: The DTC Receipt shall provide that it shall
evidence the aggregate amount of Depositary Shares from time to time indicated
in the records of the Depositary and that the aggregate amount of Depositary
Shares evidenced thereby may from time to time be increased or decreased by
making adjustments on such records of the Depositary.]
Other than in the case of splits, combinations or other
reclassifications affecting the Stock, or in the case of dividends or other
distributions of Stock, if any, there shall be deposited with the Depositary
hereunder not more than ______ shares of Stock.
SECTION 2.03. REDEMPTION OF STOCK. Whenever the Company shall
elect to redeem shares of Stock in accordance with the provisions of the
Amendment, it shall (unless otherwise agreed in writing with the Depositary)
mail notice to the Depositary of such redemption, by first class mail, postage
prepaid, not less than 40 nor more than 70 days prior to the date fixed for the
redemption of Stock in accordance with the provisions of the Amendment. On the
date of such redemption, provided that the Company shall then have paid in full
to the Depositary the redemption price required pursuant
- 10 -
<PAGE>
to the Amendment relating to the Stock to be redeemed, the Depositary shall
redeem the Depositary Shares relating to such Stock. The Depositary shall mail
notice of such redemption, and the simultaneous redemption of the number of
Depositary Shares relating to the Stock to be redeemed, by first-class mail,
postage prepaid, not less than 30 and not more than 60 days prior to the date
fixed for redemption of such Stock and Depositary Shares (the "Redemption
Date"), to the record holders of the Receipts evidencing the Depositary Shares
to be so redeemed on the record date fixed pursuant to Section 4.04 hereof, at
the addresses of such holders as they appear on the records of the Depositary;
PROVIDED, HOWEVER, that neither failure to mail any such notice to one or more
such holders nor any defect in any notice or in the mailing thereof to one or
more such holders shall affect the validity of the proceedings for redemption of
any Depositary Shares as to other holders. Each such notice of redemption shall
state: (i) the Redemption Date; (ii) the number of Depositary Shares to be
redeemed and, if less than all the Depositary Shares held by any such holder are
to be redeemed, the number of such Depositary Shares held by such holder to be
so redeemed and the method by which the Depositary Shares will be chosen for
redemption; (iii) the redemption price (including cumulative dividends to the
Redemption Date); (iv) the place or places where Receipts evidencing Depositary
Shares are to be surrendered for payment of the redemption price; (v) that
- 11 -
<PAGE>
dividends in respect of the Stock to be redeemed, which are represented by the
Depositary Shares to be redeemed, will cease to accrue at the close of business
on such Redemption Date and (vi) if a date other than the Redemption Date, the
date from and after which the Stock and Depositary Shares shall no longer be
deemed to be outstanding.. In case less than all the outstanding Depositary
Shares are to be redeemed, the Depositary Shares to be so redeemed shall be
selected by lot or pro rata as may be determined by the Company.
Notice having been mailed by the Depositary as aforesaid, from
and after (a) the Redemption Date (unless the Company shall have failed to
redeem the shares of Stock to be redeemed by it as set forth in the Company's
notice provided for in the preceding paragraph), or (b) such earlier date (if
applicable) upon which the Company deposits the Redemption Price with the paying
agent for the holders of the Stock (regardless of whether such shares are
actually surrendered for cancellation), all dividends in respect of the shares
of Stock so called for redemption shall cease to accrue, the Depositary Shares
being redeemed from such proceeds shall be deemed no longer to be outstanding,
all rights of the holders of Receipts evidencing such Depositary Shares (except
the right to receive the redemption price) shall, to the extent of such
Depositary Shares, cease and terminate and, upon surrender in accordance with
such notice of the Receipts evidencing any such Depositary Shares called for
redemption (properly endorsed or assigned for transfer, if the Depositary
- 12 -
<PAGE>
shall so require), such Depositary Shares shall be redeemed by the Depositary at
a redemption price per Depositary Share equal to 1/__th of the redemption price
per share paid in respect of the shares of Stock plus all money and other
property, if any, underlying such Depositary Shares, including all amounts paid
by the Company in respect of dividends which on the Redemption Date have accrued
on the shares of Stock to be so redeemed and have not theretofore been paid.
If less than all the Depositary Shares evidenced by a Receipt
are called for redemption, the Depositary will deliver to the holder of such
Receipt upon its surrender to the Depositary, together with the payment of the
redemption price, a new Receipt evidencing such number of Depositary Shares as
were evidenced by such prior Receipt and not called for redemption; PROVIDED,
HOWEVER, that such replacement Receipt shall be issued only in denominations of
whole Depositary Shares and cash will be payable in respect of fractional
interests.
SECTION 2.04. REGISTRATION OF TRANSFER OF RECEIPTS. Subject to
the terms and conditions of this Deposit Agreement, the Registrar, on behalf of
the Depositary, shall register on its books transfers of Receipts from time to
time upon notice to the Registrar by the Depositary of the surrender of a
Receipt for transfer by the holder in person or by duly authorized attorney,
which Receipt in each case must be properly endorsed or accompanied by a
properly executed
- 13 -
<PAGE>
instrument of transfer. Upon surrender of a properly endorsed Receipt or Receipt
accompanied by an instrument of transfer, the Depositary shall execute a new
Receipt or Receipts evidencing the same aggregate number of Depositary Shares as
those evidenced by the Receipt or Receipts surrendered and deliver such new
Receipt or Receipts to or upon the order of the transferee named in the
endorsement or instrument of transfer.
SECTION 2.05. SPLIT-UPS AND COMBINATIONS OF RECEIPTS;
SURRENDER OF RECEIPTS AND WITHDRAWAL OF STOCK. Upon surrender of a Receipt or
Receipts at the Depositary's Office or at such other offices as it may designate
for the purpose of effecting a split-up or combination of such Receipt or
Receipts, the Depositary shall execute and deliver a new Receipt or Receipts to
the holder thereof or to such holder's order in the denominations requested,
evidencing the aggregate number of Depositary Shares evidenced by the Receipt or
Receipts surrendered. The Depositary shall give prompt notice of such action and
the certificate numbers to the Registrar for the purpose of recording such
split-up or consolidation.
Unless the related Depositary Shares have previously been
called for redemption, any holder of a Receipt or Receipts representing any
number of whole shares of Stock (or such holder's duly authorized attorney) may
withdraw the number of whole shares of Stock underlying such Depositary Shares
and all money and other property, if any, represented
- 14 -
<PAGE>
thereby by surrendering such Receipt or Receipts at the Depositary's Office or
at such other offices as the Depositary may designate for such withdrawals. [If
Receipts are to be issued in Book-Entry Form: If such holder's Depositary Shares
are being held by DTC or its nominee pursuant to Section 2.01, such holder shall
request, in accordance with Section 2.09, withdrawal from the book-entry system
of the number of Depositary Shares specified in the preceding sentence.]
Thereafter, without unreasonable delay, the Depositary shall deliver to such
holder, or to the person or persons designated by such holder as hereinafter
provided, the number of whole shares of Stock and all money and other property,
if any, represented by the Receipt or Receipts so surrendered for withdrawal,
but holders of such whole shares of Stock will not thereafter be entitled to
deposit such Stock hereunder or to receive Depositary Shares therefor. If the
Receipt or Receipts delivered by the holder to the Depositary in connection with
such withdrawal shall evidence in the aggregate a number of Depositary Shares in
excess of the number of Depositary Shares representing the number of whole
shares of Stock to be so withdrawn, the Depositary shall at the same time, in
addition to such number of whole shares of Stock and such money and other
property, if any, to be so withdrawn, deliver to such holder, or (subject to
Sections 2.04 and 3.02) upon his order, a new Receipt evidencing such excess
number of Depositary Shares. Delivery of the Stock and the money and other
property being withdrawn
- 15 -
<PAGE>
may be made by the delivery of such certificates, documents of title and other
instruments as the Depositary may deem appropriate.
Stock delivered pursuant to the preceding paragraph may be
endorsed with or have incorporated in the text thereof such legend or recitals
or changes not inconsistent with the provisions of this Deposit Agreement as may
be required by the Depositary or required to comply with any applicable law or
any regulation thereunder or with the rules and regulations of any securities
exchange upon which the Stock may be listed or to conform with any usage with
respect thereto, or to indicate any special limitations or restrictions to which
any particular shares of Stock are subject.
If the Stock and the money and other property being withdrawn
are to be delivered to a person or persons other than the record holder of the
Receipt or Receipts being surrendered for withdrawal of Stock, such holder shall
execute and deliver to the Depositary a written order so directing the
Depositary and the Depositary may require that the Receipt or Receipts
surrendered by such holder for withdrawal of such shares of Stock be properly
endorsed in blank or accompanied by a properly executed instrument of transfer
in blank.
Delivery of the Stock and the money and other property, if
any, represented by Receipts surrendered for withdrawal shall be made by the
Depositary at the Depositary's Office, except that, at the request, risk and
expense of the holder surrendering such Receipt or Receipts and for the
- 16 -
<PAGE>
account of the holder thereof, such delivery may be made at such other place as
may be designated by such holder.
SECTION 2.06. LIMITATIONS ON EXECUTION AND DELIVERY, TRANSFER,
SURRENDER AND EXCHANGE OF RECEIPTS. As a condition precedent to the execution
and delivery, registration of transfer, split-up, combination, surrender or
exchange of any Receipt, the Depositary, any of the Depositary's Agents or the
Company may require payment to it of a sum sufficient for the payment (or, in
the event that the Depositary or the Company shall have made such payment, the
reimbursement to it) of any charges or expenses payable by the holder of a
Receipt pursuant to Section 5.07, may require the production of evidence
satisfactory to it as to the identity and genuineness of any signature and may
also require compliance with the rules and regulations of any governmental body,
any stock exchange or any applicable self regulatory body, including without
limitation, the National Association of Securities Dealers, Inc. (the "NASD") or
such regulations, if any, as the Depositary or the Company may establish
consistent with the provisions of this Deposit Agreement.
The [If shares of Stock may be deposited by holders thereof:
deposit of Stock may be refused, the] delivery of Receipts against Stock
deposited with the Depositary may be suspended, the registration of transfer of
Receipts may be refused and the registration of transfer, surrender or exchange
of outstanding Receipts may be suspended (i) during
- 17 -
<PAGE>
any period when the register of stockholders of the Company is closed or (ii) if
any such action is deemed necessary by the Depositary, any of the Depositary's
Agents or the Company at any time or from time to time because of any
requirement of law or of any government, governmental body or commission, stock
exchange or the NASD or under any provision of this Deposit Agreement.
SECTION 2.07. LOST RECEIPTS, ETC. If any mutilated Receipt is
surrendered to the Depositary, the Depositary shall execute and deliver in
exchange therefor a new Receipt of like form and tenor in exchange and
substitution for such mutilated Receipt. In case any Receipt shall be destroyed,
lost or stolen, then, in the absence of notice to the Depositary that such
Receipt has been acquired by a bona fide purchaser, the Depositary shall execute
and deliver a Receipt to the holder thereof of like form and tenor in exchange
and substitution for such destroyed, lost or stolen Receipt, upon (i) the filing
by the holder thereof with the Depositary of evidence satisfactory to the
Depositary and the Company of such destruction or loss or theft of such Receipt,
of the authenticity thereof and of such holder's ownership thereof and (ii) the
holder's furnishing the Depositary with indemnification satisfactory to such
Depositary and the Company.
SECTION 2.08. CANCELLATION AND DESTRUCTION OF
SURRENDERED RECEIPTS. All Receipts surrendered to the
- 18 -
<PAGE>
Depositary or any Depositary's Agent shall be canceled by the Depositary. Except
as prohibited by applicable law or regulation, the Depositary is authorized to
destroy all Receipts so canceled. [If Receipts are to be issued in Book- Entry
Form: Any Receipt evidenced in book-entry form shall be deemed canceled when the
Depositary has caused the amount of Depositary Shares evidenced by the DTC
Receipt to be reduced in proportion to the number of Depositary Shares evidenced
by the surrendered Receipt.]
[If Receipts are to be issued in Book-Entry Form: SECTION
2.09. INTERCHANGEABILITY OF BOOK-ENTRY RECEIPTS AND RECEIPTS IN PHYSICAL,
CERTIFICATED FORM. Subject to the terms and conditions of this Deposit
Agreement, upon receipt by the Depositary of written instructions from a DTC
participant on behalf of any person having a beneficial interest in Depositary
Shares evidenced by the DTC Receipt for the purpose of directing the Depositary
to execute and deliver a Receipt in physical, certificated form evidencing such
Depositary Shares, the Depositary shall follow the procedures set forth in the
FAST Agreement for the purpose of reducing the number of Depositary Shares
evidenced by the DTC Receipt and, following such reduction, shall execute and
deliver to or upon the order of the person or persons named in such order a
Receipt or Receipts registered in the name or names requested by such person and
evidencing in the aggregate the number of Depositary Shares equal to the
reduction in the number
- 19 -
<PAGE>
evidenced by the DTC Receipt. The Depositary may require in such written
instructions any certification or representations as it shall deem necessary to
comply with applicable law.
Subject to the terms and conditions of this Deposit Agreement,
upon receipt by the Depositary of a Receipt or Receipts in physical,
certificated form, duly endorsed or accompanied by appropriate instruments of
transfer, in form satisfactory to the Depositary, including any required
certifications, and together with written instructions directing the Depositary
to adjust its records to reflect an increase in the aggregate amount of
Depositary Shares evidenced by the DTC Receipt (including, without limitation,
information regarding the DTC participant account to be credited with such
increase), and upon payment of the fees and expenses of the Depositary, the
Depositary shall cancel such Receipt or Receipts in physical, certificated form
and shall follow the procedures set forth in the FAST Agreement for the purpose
of reflecting such increase in the number of Depositary Shares evidenced by the
DTC Receipt.]
SECTION 2.__. STOCK PURCHASE PLANS. The Depositary shall take
such action as shall be necessary or appropriate to permit the record holders of
the Depositary Shares to participate in any dividend reinvestment or other stock
purchase plan sponsored by the Company that permits the participation by such
holders on such terms and conditions as the Company may determine.
- 20 -
<PAGE>
ARTICLE III
CERTAIN OBLIGATIONS OF THE HOLDERS
OF RECEIPTS AND THE COMPANY
SECTION 3.01. FILING PROOFS, CERTIFICATES AND OTHER
INFORMATION. Any holder of a Receipt may be required from time to time to file
such proof of residence, or other matters or other information, to obtain such
guaranties of signature, to execute such certificates and to make such customary
representations and warranties consistent with the terms of the Stock as the
Depositary or the Company may deem necessary or proper. The Depositary or the
Company may withhold the delivery, or delay the registration of transfer,
redemption or exchange, of any Receipt or the distribution of any dividend or
other distribution or the sale of any rights or of the proceeds thereof until
such proof or other information is filed or such certificates are executed or
such representations and warranties are made.
SECTION 3.02. PAYMENT OF TAXES OR OTHER GOVERNMENTAL CHARGES.
Holders of Receipts shall be obligated to make payments to the Depositary of
certain charges and expenses as provided in Section 5.07, or provide evidence
satisfactory to the Depositary that such charges and expenses have been paid.
Registration of transfer of any Receipt and delivery of all money or other
property, if any, represented by the Depositary Shares evidenced by such Receipt
may be refused until any such payment due is made, and any dividends,
- 21 -
<PAGE>
interest payments or other distributions may be withheld or all or any part of
the Stock or other property represented by the Depositary Shares evidenced by
such Receipt and not theretofore sold may be sold for the account of the holder
thereof (after attempting by reasonable means to notify such holder prior to
such sale), and such dividends, interest payments or other distributions or the
proceeds of any such sale may be applied to any payment of such charges or
expenses, the holder of such Receipt remaining liable for any deficiency.
SECTION 3.03. WARRANTY AS TO STOCK. The Company hereby
represents and warrants to the Depositary that the Stock, when issued, will be
validly issued, fully paid and nonassessable. Such representation and warranty
shall survive the deposit of the Stock and the issuance of Receipts.
SECTION 3.04. WARRANTY AS TO RECEIPTS. The Depositary hereby
represents and warrants that the Receipts, when issued, will be legal, valid and
binding obligations of the Depositary, enforceable against the Depositary in
accordance with their terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, moratorium and other laws affecting
creditors' rights generally and by general equity principles. Such
representation and warranty shall survive the deposit of the Stock and the
issuance of the Receipts.
- 22 -
<PAGE>
ARTICLE IV
THE DEPOSITED SECURITIES; NOTICES
SECTION 4.01. CASH DISTRIBUTIONS. Whenever the Depositary
shall receive any cash dividend or other cash distribution with respect to the
Stock, the Depositary shall, subject to Section 3.02, distribute to record
holders of Receipts on the record date fixed pursuant to Section 4.04 the pro
rata portion, as nearly as practicable, of such dividend or distribution
applicable to the number of Depositary Shares evidenced by the Receipts held by
such holders; PROVIDED, HOWEVER, that in case the Company or the Depositary
shall be required to withhold and shall withhold any monies from any cash
dividend or other cash distribution in respect of the Stock on account of taxes,
the distribution in respect of Depositary Shares shall be reduced accordingly.
The Depositary shall distribute or make available for distribution, as the case
may be, only such amount, however, as can be distributed without attributing to
any holder of Depositary Shares a fraction of one cent, and any balance not so
distributable shall be held by the Depositary (without liability for interest
thereon) and shall be added to and be treated as part of the next succeeding
distribution to record holders of Receipts.
SECTION 4.02. DISTRIBUTIONS OTHER THAN CASH.
Whenever the Depositary shall receive any property (including
securities) for distribution in a form other than cash with
- 23 -
<PAGE>
respect to the Stock, the Depositary shall, subject to Section 3.02, distribute
to record holders of Receipts on the record date fixed pursuant to Section 4.04
the pro rata portion, as nearly as practicable, of such property (including
securities) received by it applicable to the number of Depositary Shares
evidenced by the Receipts held by such holders, in any manner that the
Depositary may deem equitable and practicable for accomplishing such
distribution. If in the opinion of the Depositary such distribution cannot be
made proportionately among such record holders, or if for any other reason
(including any requirement that the Company or the Depositary withhold an amount
on account of taxes) the Depositary deems, after consultation with the Company,
such distribution not to be feasible, the Depositary may, with the approval of
the Company, adopt such method as it deems equitable and practicable for the
purpose of effecting such distribution, including the sale of the property thus
received, or any part thereof. The net proceeds of any such sale shall, subject
to Section 3.02, be distributed or made available for distribution, as the case
may be, by the Depositary to record holders of Receipts in accordance with the
provisions of Section 4.01 for a distribution received in cash. The Depositary
shall have the right, prior to making any distribution of such securities, to
require the Company to provide an opinion of counsel stating that such
securities have been registered under the Securities Act or do not need to be so
registered.
- 24 -
<PAGE>
SECTION 4.03. SUBSCRIPTION RIGHTS, PREFERENCES OR PRIVILEGES.
If the Company shall at any time offer or cause to be offered to the persons in
whose names Stock is recorded on the books of the Company any rights,
preferences or privileges to subscribe for or to purchase any securities or any
rights, preferences or privileges of any other nature, such rights, preferences
or privileges shall in each such instance be made available by the Depositary to
the record holders of Receipts, pro rata in proportion to the Stock represented
by such Receipt, in such manner as the Depositary may determine, either by the
issue to such record holders of warrants representing such rights, preferences
or privileges or by such other method as may be approved by the Depositary in
its discretion with the approval of the Company; PROVIDED, HOWEVER, that (i) if
at the time of issue or offer of any such rights, preferences or privileges the
Depositary determines that it is not lawful or (after consultation with the
Company) not feasible to make such rights, preferences or privileges available
to holders of Receipts by the issue of warrants or otherwise, or (ii) if and to
the extent so instructed by holders of Receipts who do not desire to exercise
such rights, preferences or privileges, then the Depositary, in its discretion
(with the approval of the Company, in any case where the Depositary has
determined that it is not feasible to make such rights, preferences or
privileges available), may, if applicable laws or the terms of such rights,
preferences or
- 25 -
<PAGE>
privileges permit such transfer, sell such rights, preferences or privileges at
public or private sale, at such place or places and upon such terms as it may
deem proper. The net proceeds of any such sales shall be distributed by the
Depositary to the record holders of Receipts entitled thereto as provided by
Section 4.01 in the case of a distribution received in cash. The Depositary
shall have the right, prior to making any distribution of such rights,
preferences or privileges, to require the Company to provide an opinion of
counsel stating that such rights, preferences or privileges have been registered
under the Securities Act or do not need to be so registered.
If registration under the Securities Act of the securities to
which any rights, preferences or privileges relate is required in order for
holders of Receipts to be offered or sold the securities to which such rights,
preferences or privileges relate, the Company agrees with the Depositary that it
will file promptly a registration statement pursuant to the Securities Act with
respect to such rights, preferences or privileges and securities and use its
reasonable best efforts and take all steps available to it to cause such
registration statement to become effective sufficiently in advance of the
expiration of such rights, preferences or privileges to enable such holders to
exercise such rights, preferences or privileges. In no event shall the
Depositary make available to the holders of Receipts any right, preference or
privilege to subscribe for or to purchase
- 26 -
<PAGE>
any security unless and until such registration statement shall have become
effective, or unless the offering and sale of such securities to holders are
exempt from registration under the Securities Act.
If any other action under the laws of any jurisdiction or any
governmental or administrative authorization, consent or permit is required in
order for such rights, preferences or privileges to be made available to holders
of Receipts, the Company agrees with the Depositary that the Company will use
its reasonable best efforts to take such action or obtain such authorization,
consent or permit sufficiently in advance of the expiration of such rights,
preferences or privileges to enable such holders to exercise such rights,
preferences or privileges.
SECTION 4.04. NOTICE OF DIVIDENDS, ETC.; FIXING OF RECORD DATE
FOR HOLDERS OF RECEIPTS. (i) Whenever any cash dividend or other cash
distribution shall become payable or any distribution of property (including
securities) other than cash shall be made, (ii) if rights, preferences or
privileges shall at any time be offered with respect to Stock, (iii) whenever
the Depositary shall receive notice of (a) any meeting at which holders of Stock
are entitled to vote or of which holders of Stock are entitled to notice, or (b)
any election on the part of the Company to redeem any shares of Stock, or (iv)
whenever the Depositary and the Company shall decide it is appropriate, the
Depositary shall, in each such
- 27 -
<PAGE>
instance, fix a record date (which shall be the same date as the record date
fixed by the Company with respect to the Stock) for the determination of the
holders of Receipts who shall be entitled hereunder to receive a distribution in
respect of such dividend, distribution, rights, preferences or privileges or the
net proceeds of the sale thereof, or to give instructions for the exercise of
voting rights at any such meeting, or who should be entitled to receive notice
of such meeting or for any other appropriate reasons.
SECTION 4.05. VOTING RIGHTS. Upon receipt of notice of any
meeting at which the holders of Stock are entitled to vote, the Depositary
shall, as soon as practicable thereafter, mail to the record holders of Receipts
a notice which shall contain (i) such information as is contained in such notice
of meeting and (ii) a statement that the holders may, subject to any applicable
restrictions, authorize the Depositary to exercise the voting rights pertaining
to the amount of Stock underlying their respective Depositary Shares (including
authority to give a discretionary proxy to a person designated by the Company)
and a brief statement as to the manner in which such authorization may be given.
The Depositary shall endeavor, insofar as practicable, to vote or cause to be
voted, in accordance with the authorization referred to above, the votes
relating to the shares of Stock (or portion thereof) underlying the Depositary
Shares evidenced by all Receipts as to which such authorization has
- 28 -
<PAGE>
been received. The Company hereby agrees to take all such action as it deems
necessary in order to enable the Depositary to vote such Stock or cause such
Stock to be voted. In the absence of authorization from the holder of a Receipt,
the Depositary will abstain from voting (but, at its discretion, not from
appearing at any meeting with respect to such Stock unless directed to the
contrary by the holders of all the Receipts) to the extent of the Stock (or
portion thereof) underlying the Depositary Shares evidenced by such Receipt.
SECTION 4.06. CHANGES AFFECTING DEPOSITED SECURITIES AND
RECLASSIFICATIONS, RECAPITALIZATIONS, ETC. Upon any change in par or stated
value, split-up, combination or any other reclassification of the Stock, or upon
any recapitalization, reorganization, merger, amalgamation or consolidation to
which the Company is a party or sale of all or substantially all of the
Company's assets, the Depositary may with the approval of, and shall upon the
instructions of, the Company, and (in either case) in such manner as to retain
as nearly as possible the percentage ownership interest in Stock of holders of
the Receipts immediately prior to such event, (i) make such adjustments in (a)
the fraction of an interest in one share of Stock underlying one Depositary
Share and (b) the ratio of the redemption price per Depositary Share to the
redemption price of a share of Stock, in each case as it may deem necessary to
reflect the effects of such change in par or stated value, split-up, combination
or other
- 29 -
<PAGE>
reclassification of Stock, or of such recapitalization, reorganization, merger,
amalgamation or consolidation or sale, and (ii) treat any securities which shall
be received by the Depositary in exchange for or upon conversion of or in
respect of the Stock as new deposited securities so received in exchange for or
upon conversion of or in respect of the Stock. In any such case the Depositary
may in its discretion, with the approval of the Company, execute and deliver
additional Receipts, or may call for surrender of all outstanding Receipts to be
exchanged for new Receipts specifically describing such new deposited
securities.
Anything to the contrary herein or in the Receipt
notwithstanding, holders of Receipts shall have the right from and after the
effective date or any such change in par or stated value, split-up, combination
or other reclassification of the Stock or any such recapitalization,
reorganization, merger, amalgamation, consolidation or sale, to the extent that
holders of Stock had the right, prior to or on the applicable effective date, to
convert, exchange or surrender shares of Stock into or for other stock,
securities, property or cash, to surrender such Receipts to the Depositary with
instructions to convert, exchange or surrender the Stock represented thereby
only into or for, as the case may be, the kind and amount of shares of stock and
other securities and property and cash into which the Stock represented by such
Receipts has been converted or for which such Stock might have
- 30 -
<PAGE>
been exchanged or surrendered immediately prior to the effective date of such
transaction.
SECTION 4.07. INSPECTION OF REPORTS. The Depositary shall make
available for inspection by holders of Receipts at the Depositary's Office, and
at such other places as it may from time to time deem advisable, any reports and
communications received from the Company which are received by the Depositary as
the holder of Stock.
SECTION 4.08. LIST OF RECEIPT HOLDERS. Promptly, upon request
by the Company, the Depositary shall furnish to it a list, as of a specified
date, of the names and addresses of all persons in whose names Receipts are
registered on the books of the Depositary, and the amount of Stock represented
thereby.
ARTICLE V
THE DEPOSITARY, THE DEPOSITARY'S AGENTS,
THE REGISTRAR AND THE COMPANY
SECTION 5.01. MAINTENANCE OF OFFICES, AGENCIES AND TRANSFER
BOOKS BY THE DEPOSITARY; REGISTRAR. Upon execution of this Deposit Agreement,
the Depositary shall maintain, at the Depositary's Office, facilities for the
execution and delivery, registration and registration of transfer, surrender and
exchange of Receipts, and at the offices of the Depositary's Agents, if any,
facilities for the delivery, registration of transfer, surrender and exchange of
Receipts,
- 31 -
<PAGE>
all in accordance with the provisions of this Deposit Agreement.
The Depositary shall, with the approval of the Company,
appoint a Registrar for registration of such Receipts or Depositary Shares in
accordance with any requirements of any applicable stock exchange in which the
Receipts or the Depositary Shares may be listed. Such Registrar (which may be
the Depositary if so permitted by the requirements of such exchange) may be
removed and a substitute Registrar appointed by the Depositary upon the request
or with the approval of the Company. If the Receipts, the Depositary Shares or
the Stock are listed on one or more other stock exchanges, the Depositary will,
at the request of the Company, arrange such facilities for the delivery,
registration, registration of transfer, surrender and exchange of such Receipts,
such Depositary Shares or such Stock as may be required by law or applicable
stock exchange regulation.
The Registrar shall maintain books at the Depositary's Office
for the registration and registration of transfer of Receipts or at such other
place as shall be approved by the Company and of which the holders of Receipts
shall have reasonable notice, which books at all reasonable times shall be open
for inspection by the record holders of Receipts; PROVIDED, that the exercise of
such right shall be governed by the provisions of Section 55-16-02 of the North
Carolina Business Corporation Act, as amended, or any
- 32 -
<PAGE>
successor provision thereto, anything herein to the contrary notwithstanding.
The Depositary may cause the Registrar to close the books with
respect to the Receipts, at any time or from time to time, when the register of
stockholders of the Company is closed with respect to the Stock or when such
action is deemed necessary or advisable by the Depositary, any Depositary's
Agent or the Company because of any requirement of law or of any government,
governmental body or commission, stock exchange or any applicable
self-regulatory body, including, without limitation, the NASD.
SECTION 5.02. PREVENTION OF OR DELAY IN PERFORMANCE BY THE
DEPOSITARY, THE DEPOSITARY'S AGENTS, THE REGISTRAR OR THE COMPANY. Neither the
Depositary nor any Depositary's Agent nor any Registrar nor the Company shall
incur any liability to any holder of any Receipt if by reason of any provision
of any present or future law, or regulation thereunder, of the United States of
America or of any other governmental authority or, in the case of the
Depositary, the Depositary's Agent or the Registrar, by reason of any provision,
present or future, of the Company's Articles of Incorporation, as amended
(including the Amendment), or by reason of any act of God or war, the
Depositary, the Depositary's Agent, the Registrar or the Company shall be
prevented or forbidden from doing or performing any act or thing which the terms
of this Deposit Agreement provide shall
- 33 -
<PAGE>
be done or performed; nor shall the Depositary, any Depositary's Agent, any
Registrar or the Company incur any liability or be subject to any obligation (i)
by reason of any nonperformance or delay, caused as aforesaid, in the
performance of any act or thing which the terms of this Deposit Agreement
provide shall or may be done or performed, or (ii) by reason of any exercise of,
or failure to exercise, any discretion provided for in this Deposit Agreement,
except in the event of the gross negligence or willful misconduct of the party
charged with such exercise or failure to exercise.
SECTION 5.03. OBLIGATIONS OF THE DEPOSITARY, THE DEPOSITARY'S
AGENTS, THE REGISTRAR AND THE COMPANY. Neither the Depositary nor any
Depositary's Agent nor any Registrar nor the Company assumes any obligation or
shall be subject to any liability under this Deposit Agreement to holders of
Receipts other than for its gross negligence or willful misconduct.
Neither the Depositary nor any Depositary's Agent nor any
Registrar nor the Company shall be under any obligation to appear in, prosecute
or defend any action, suit or other proceeding in respect of the Stock, the
Depositary Shares or the Receipts which in its opinion may involve it in expense
or liability unless indemnity to such party against all expense and liability be
furnished as often as required.
Neither the Depositary nor any Depositary's Agent nor any
Registrar nor the Company shall be liable to any party
- 34 -
<PAGE>
hereto for any action or any failure to act by it in reliance upon the written
advice of legal counsel or accountants, or information from any person
presenting Stock for deposit or any holder of a Receipt. The Depositary, any
Depositary's Agent, any Registrar and the Company may each rely and shall each
be protected in acting upon any written notice, request, direction or other
document believed by it to be genuine and to have been signed or presented by
the party or parties specified in this Agreement.
The Depositary shall not be responsible for any failure to
carry out any authorization to vote any of the shares of Stock of for the manner
or effect of any such vote made, as long as such action or inaction is in good
faith and does not result from the gross negligence or willful misconduct of the
Depositary. The Depositary undertakes and shall cause any Registrar to
undertake, to perform such duties and only such duties as are specifically set
forth in this Agreement using its reasonable best efforts and in good faith. The
parties hereto acknowledge that no implied covenants or obligations shall be
read into this Deposit Agreement against the Depositary or any Registrar or
against the Company with respect to the Depositary and any Registrar. The
Depositary will indemnify the Company against any liability which may arise out
of acts performed or omitted by the Depositary or any Depositary's Agent due to
its or their gross negligence or bad faith. The Depositary, any Depositary's
Agent, any Registrar and the Company may own and deal in any class of
- 35 -
<PAGE>
securities of the Company and its affiliates and in Receipts subject to the
provisions of applicable law. The Depositary may also act as transfer agent or
registrar of any of the securities of the Company and its affiliates.
SECTION 5.04. RESIGNATION AND REMOVAL OF THE DEPOSITARY:
APPOINTMENT OF SUCCESSOR DEPOSITARY. The Depositary may at any time resign as
Depositary hereunder by notice of its election so to do delivered to the
Company, such resignation to take effect upon the appointment of a successor
Depositary and its acceptance of such appointment as hereinafter provided.
The Depositary may at any time be removed by the Company by
notice of such removal delivered to the Depositary, such removal to take effect
upon the appointment of a successor Depositary and its acceptance of such
appointment as hereinafter provided.
In case the Depositary acting hereunder shall at any time
resign or be removed, the Company shall, within 60 days after the delivery of
the notice of resignation or removal, as the case may be, appoint a successor
Depositary, which shall be a bank or trust company having its principal office
in the United States of America and having a combined capital and surplus of at
least $50,000,000. Every successor Depositary shall execute and deliver to its
predecessor and to the Company an instrument in writing accepting its
appointment hereunder and agreeing to become a party to this Agreement,
- 36 -
<PAGE>
and thereupon such successor Depositary, without any further act or deed, shall
become fully vested with all the rights, powers, duties and obligations of its
predecessor and for all purposes shall be the Depositary under this Deposit
Agreement, and such predecessor, upon payment of all sums due it and on the
written request of the Company, shall execute and deliver an instrument
transferring to such successor all rights and powers of such predecessor
hereunder, shall duly assign, transfer and deliver all right, title and interest
in the Stock and any monies or property held hereunder to such successor and
shall deliver to such successor a list of the record holders of all outstanding
Receipts. Any successor Depositary shall promptly mail notice of its appointment
to the record holders of Receipts.
Any corporation or other entity into or with which the
Depositary may be merged, consolidated or converted, or to which the Depositary
may sell all or substantially all its assets, shall be the successor of such
Depositary without the execution or filing of any document or any further act.
Such successor Depositary may authenticate the Receipts in the name of the
predecessor Depositary or in the name of the successor Depositary.
SECTION 5.05. CORPORATE NOTICES AND REPORTS. The Company
agrees that it will deliver to the Depositary and the Depositary will, promptly
after receipt thereof, transmit to the record holders of Receipts, in each case
at the address
- 37 -
<PAGE>
furnished to it pursuant to Section 4.08, all notices and reports (including
without limitation financial statements) required by law, the rules of any
national securities exchange upon which the Stock, the Depositary Shares or the
Receipts are listed or by the Company's Articles of Incorporation, as amended
(including the Amendment), to be furnished by the Company to holders of Stock.
Such transmission will be at the Company's expense and the Company will provide
the Depositary with such number of copies of such documents as the Depositary
may reasonably request.
SECTION 5.06. INDEMNIFICATION BY THE COMPANY. The Company
shall indemnify the Depositary, any Depositary's Agent and any Registrar
against, and hold each of them harmless from, any loss, liability or expense
(including the reasonable costs and expenses of defending itself) which may
arise out of (i) acts performed or omitted in connection with this Agreement and
the Receipts (a) by the Depositary, any Registrar or any of their respective
agents (including any Depositary's Agent), except for any liability arising out
of gross negligence or willful misconduct on the respective parts of any such
person or persons, or (b) by the Company or any of its agents, or (ii) the
offer, sale or registration of the Receipts or the Stock pursuant to the
provisions hereof. The obligations of the Company set forth in this Section 5.06
shall survive any succession of any Depositary, Registrar or Depositary's Agent.
- 38 -
<PAGE>
SECTION 5.07. CHARGES AND EXPENSES. The Company shall pay all
charges of the Depositary in connection with the initial deposit of the Stock
and the initial issuance of the Depositary Shares, and redemption of the Stock
at the option of the Company. All other transfer and other taxes and
governmental charges shall be at the expense of holders of Depositary Shares.
The Depositary may refuse to effect any transfer of a Receipt or any withdrawal
of Stock evidenced thereby until all such taxes and charges with respect to such
Receipt or Stock are paid by the holder thereof. If, at the request of a holder
of Receipts, the Depositary incurs charges or expenses for which it is not
otherwise liable hereunder, such holder will be liable for such charges and
expenses.
All other charges and expenses of the Depositary and any
Depositary's Agent hereunder and of any Registrar (including, in each case,
reasonable fees and expenses of counsel) incident to the performance of their
respective obligations hereunder will be payable by the Company only after prior
consultation and agreement between the Depositary and the Company and consent by
the Company to the incurrence of such expenses, which consent shall not be
unreasonably withheld. The Depositary shall present any statement for charges
and expenses to the Company promptly, unless the Company shall agree otherwise.
- 39 -
<PAGE>
ARTICLE VI
AMENDMENT AND TERMINATION
SECTION 6.01. AMENDMENT. The form of the Receipts and any
provisions of this Deposit Agreement may at any time and from time to time be
amended by agreement between the Company and the Depositary in any respect which
they may deem necessary or desirable; PROVIDED, HOWEVER, that no such amendment
which shall materially and adversely alter the rights of the holders of Receipts
shall be effective unless such amendment shall have been approved by the holders
of at least a majority of the Depositary Shares then outstanding. Every holder
of an outstanding Receipt at the time any such amendment becomes effective shall
be deemed, by continuing to hold such Receipt, to consent and agree to such
amendment and to be bound by the Deposit Agreement as amended thereby. In no
event shall any amendment impair the right, subject to the provisions of
Sections 2.05 and 2.06 hereof, of any owner of any Depositary Shares to
surrender any Receipt evidencing such Depositary Shares to the Depositary with
instructions to deliver to the holder the Stock and all money and other
property, if any, represented thereby, except in order to comply with mandatory
provisions of applicable law or the rules and regulations of any governmental
body, agency or commission, the NASD or any applicable stock exchange.
SECTION 6.02. TERMINATION. This Agreement may be terminated by
the Company or the Depositary only if (i) all
- 40 -
<PAGE>
outstanding Depositary Shares shall have been redeemed pursuant to Section 2.03,
(ii) all the Stock has been withdrawn pursuant to Section 2.05, or (iii) there
shall have been made a final distribution in respect of the Stock in connection
with any liquidation, dissolution or winding up of the Company and such
distribution shall have been distributed to the holders of Depositary Shares
pursuant to Section 4.01 or 4.02, as applicable.
Whenever the Deposit Agreement has been terminated pursuant to
(iii) above, the Depositary will mail notice of such termination to the record
holders of all Depositary Shares then outstanding at least 30 days prior to the
date fixed in that notice for termination of the Deposit Agreement. If any
Depositary Shares remain outstanding after the date of termination, the
Depositary thereafter will discontinue the transfer of Depositary Shares, will
suspend the distribution of dividends to the owners thereof, and will not give
any further notices (other than notice of such termination) or perform any
further acts under this Deposit Agreement, except that the Depositary will
continue (i) to collect dividends on the Stock and any other distributions with
respect thereto, (ii) to deliver or cause to be delivered shares of Stock,
together with such dividends and distributions, or principal and interest, and
the net proceeds of any sales of rights, preferences, privileges or other
property (other than real property) in exchange for Depositary Shares
surrendered. At any time after the expiration of three years from the date of
- 41 -
<PAGE>
termination, the Depositary may sell the Stock then held by it at a public or
private sale, at such place or places and upon such terms as it deems proper and
may thereafter hold the net proceeds of such sale, without liability for
interest, for the pro rata benefit of the owners of the Depositary Shares which
have not theretofore been surrendered. Subject to applicable escheat laws, any
monies set aside by the Company in respect of any payment with respect to the
Stock represented by the Depositary Shares, or dividends thereon, and unclaimed
at the end of three years form the date upon which such payment is due and
payable shall revert to the general funds of the Company, after which reversion
the holders of such Depositary Shares shall look only to the general funds of
the Company for payment thereof.
Upon the termination of this Deposit Agreement, the parties
hereto shall be discharged from all obligations under this Deposit Agreement
except for their respective obligations under Sections 5.03, 5.06 and 5.07.
ARTICLE VII
MISCELLANEOUS
SECTION 7.01. COUNTERPARTS. This Deposit Agreement may be
executed in any number of counterparts, and by each of the parties hereto on
separate counterparts, each of which counterparts, when so executed and
delivered, shall
- 42 -
<PAGE>
be deemed an original, but all such counterparts taken together shall constitute
one and the same instrument.
SECTION 7.02. EXCLUSIVE BENEFIT OF PARTIES. This Deposit
Agreement is for the exclusive benefit of the parties hereto, and their
respective successors hereunder, and shall not be deemed to give any legal or
equitable right, remedy or claim to any other person whatsoever.
SECTION 7.03. INVALIDITY OF PROVISIONS. In case any one or
more of the provisions contained in this Deposit Agreement or in the Receipts
should be or become invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein or therein shall in no way be affected, prejudiced or modified thereby.
SECTION 7.04. NOTICES. Any and all notices to be given to the
Company hereunder or under the Receipts shall be in writing and shall be deemed
to have been duly given if personally delivered or sent by mail or telegram,
telecopy or telex confirmed by letter, addressed to the Company at One First
Union Center, Charlotte, North Carolina 28288, telephone: (___) ___-____,
telecopy: (___) ___-____, Attention: ________________, or at any other address
and to the attention of any other person of which the Company shall have
notified the Depositary in writing.
Any and all notices to be given to the Depositary hereunder or
under the Receipts shall be in writing and shall
- 43 -
<PAGE>
be deemed to have been duly given if personally delivered or sent by mail or by
telegram, telecopy or telex confirmed by letter, addressed to the Depositary at
the Depositary's Office, at One First Union Center, Charlotte, North Carolina
28288, telephone (___) ___-____, telecopy (___) ___-____, Attention:
________________, or at any other address and to the attention of any other
person of which the Depositary shall have notified the Company in writing.
Any and all notices to be given to any record holder of a
Receipt hereunder or under the Receipts shall be in writing and shall be deemed
to have been duly given if personally delivered or sent by mail or by telegram,
telecopy or telex confirmed by letter, addressed to such record holder at the
address of such record holder as it appears on the books of the Depositary, or
if such holder shall have filed with the Depositary a written request that
notices intended for such holder be mailed to some other address, at the address
designated in such request.
Delivery of a notice sent by mail or by telegram, telecopy or
telex shall be deemed to be effected at the time when a duly addressed letter
containing the same (or a confirmation thereof in the case of a telegram or
telex message) is deposited, postage prepaid, in a post office letter box. The
Depositary or the Company may, however, act upon any telegram or telecopy
message received by it from the other or from any holder of a Receipt,
notwithstanding that
- 44 -
<PAGE>
such telegram or telecopy message shall not subsequently be confirmed by letter
or as aforesaid.
SECTION 7.05. DEPOSITARY'S AGENTS. The Depositary may from
time to time appoint any Depositary's Agent to act in any respect for the
Depositary for the purposes of this Deposit Agreement and may at any time
appoint additional Depositary's Agents and vary or terminate the appointment of
such Depositary's Agents. The Depositary will promptly notify the Company of any
such action.
SECTION 7.06. HOLDERS OF RECEIPTS ARE PARTIES. By acceptance
of delivery of the Receipts, any holder of such Receipt from time to time shall
be deemed to have agreed to become a party to this Deposit Agreement and to be
bound by all of the terms and conditions hereof and of the Receipts to the same
extent as though such person executed this Agreement.
SECTION 7.07. GOVERNING LAW. THIS DEPOSIT AGREEMENT AND THE
RECEIPTS AND ALL RIGHTS HEREUNDER AND THEREUNDER AND PROVISIONS HEREOF AND
THEREOF SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK (WITHOUT REFERENCE TO APPLICABLE CONFLICTS OF LAW PROVISIONS).
SECTION 7.08. INSPECTION OF DEPOSIT AGREEMENT. Copies of this
Deposit Agreement shall be filed with the Depositary and the Depositary's Agents
and shall be open to inspection during business hours at the Depositary's Office
- 45 -
<PAGE>
and the respective offices of the Depositary's Agents, if any, by any holder of
a Receipt.
SECTION 7.09. HEADINGS. The headings of articles and sections
in this Deposit Agreement and in the form of the Receipt set forth in Exhibit A
hereto have been inserted for convenience only and are not to be regarded as a
part of this Deposit Agreement or the Receipts or to have any bearing upon the
meaning or interpretation of any provision contained herein or in the Receipts.
IN WITNESS WHEREOF, the Company and the Depositary have duly
executed this Agreement as of the day and year first above set forth, and all
holders of Receipts shall become parties hereto by and upon acceptance by them
of delivery of Receipts issued in accordance with the terms hereof.
FIRST UNION CORPORATION
By: ___________________________
Authorized Officer
[FIRST UNION NATIONAL
BANK OF NORTH CAROLINA],
as Depositary
By: __________________________
Authorized Officer
- 46 -
<PAGE>
EXHIBIT A
DEPOSIT AGREEMENT
FORM OF RECEIPT
TEMPORARY RECEIPT EXCHANGEABLE FOR CERTIFICATE FOR
ENGRAVED RECEIPT WHEN READY FOR DELIVERY _________________
DEPOSITARY SHARES
TRANSFERABLE CUSIP _______________
DEPOSITARY RECEIPT
This Certificate is SEE REVERSE FOR
transferable in CERTAIN DEFINITIONS
- ----------, ----------
DEPOSITARY RECEIPT FOR DEPOSITARY SHARES,
EACH DEPOSITARY SHARE REPRESENTING A _________ INTEREST
IN ONE SHARE OF SERIES __ [___%] [CLASS A] PREFERRED STOCK
FIRST UNION CORPORATION
A North Carolina Corporation
[FIRST UNION NATIONAL BANK OF NORTH CAROLINA], as Depositary (the "Depositary"),
hereby certifies that
is the registered owner of ____________________ DEPOSITARY SHARES ("Depositary
Shares"), each Depositary Share representing a ______ interest in one share of
Series __ [___%] [Class A] Preferred Stock], no par value, (the "Stock"), of
First Union Corporation, a North Carolina corporation (the "Corporation"), on
deposit with the Depositary, subject to the terms and entitled to the benefits
of the Deposit Agreement dated as of ____________ __, ____ (the "Deposit
Agreement"), between the Corporation and the Depositary. By accepting this
Depositary Receipt, the holder hereof becomes a party to and agrees to be bound
by all the terms and conditions of the Deposit Agreement. This Depositary
Receipt shall not be valid or obligatory for any purpose or be entitled to any
benefits under the Deposit Agreement unless it shall have been executed by the
Depositary by the manual signature of a duly authorized officer or, if executed
in facsimile by the Depositary, countersigned by a Registrar in respect of the
Depositary Receipts by a duly authorized officer thereof.
Dated: ____________ __, ____
[FIRST UNION NATIONAL BANK OF NORTH
CAROLINA], Depositary
By: _______________________________
Authorized Officer
- 1 -
<PAGE>
[[REGISTRAR], Registrar
By: _______________________________
Authorized Officer]
- 2 -
<PAGE>
FIRST UNION CORPORATION
FIRST UNION CORPORATION WILL FURNISH WITHOUT CHARGE TO EACH HOLDER OF A RECEIPT
WHO SO REQUESTS A COPY OR SUMMARY OF THE DEPOSIT AGREEMENT AND A COPY OR SUMMARY
OF THE PORTIONS OF THE ARTICLES OF INCORPORATION ESTABLISHING THE DESIGNATIONS,
RELATIVE RIGHTS, PREFERENCES AND LIMITATIONS APPLICABLE TO SHARES OF EACH CLASS
AND THE VARIATIONS IN RIGHTS, PREFERENCES AND LIMITATIONS DETERMINED FOR EACH
SERIES (AND THE AUTHORITY OF THE BOARD OF DIRECTORS TO DETERMINE VARIATIONS FOR
FUTURE SERIES) WHICH THE CORPORATION IS AUTHORIZED TO ISSUE, INCLUDING THE
SERIES __ [___%] [CLASS A] PREFERRED STOCK. ANY SUCH REQUEST SHOULD BE ADDRESSED
TO FIRST UNION CORPORATION, ONE FIRST UNION CENTER, CHARLOTTE, NORTH CAROLINA
28288, ATTENTION: ________________________.
ABBREVIATIONS
The following abbreviations, when used in the inscription on
the face of this Depositary Receipt, shall be construed as though they were
written out in full according to applicable laws or regulations:
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and not as tenants in
common
UNIF GIFT MIN ACT - ______ Custodian _______
(Cust) (Minor)
under Uniform Gifts to
Minors Act _____________
(State)
UNIF GIFT MIN ACT - ______ Custodian (until age ____)
(Cust)
______ under Uniform Transfers
(Minor)
to Minors Act ______________
(State)
Additional abbreviations may also be
used though not in the above list.
- 3 -
[DEBT] [[CLASS A] PREFERRED STOCK] [COMMON STOCK]
[DEPOSITARY SHARES] WARRANT AGREEMENT
dated as of ________ __, ____
between
FIRST UNION CORPORATION
and
[NAME OF WARRANT AGENT], as Warrant Agent
-----------------------------------------------------
[Debt] [[Class A] Preferred Stock] [Common Stock]
[Depositary Share] Warrants
Expiring ________ __, ____
<PAGE>
TABLE OF CONTENTS
Page
PARTIES........................................................................1
RECITALS.......................................................................1
ARTICLE I
ISSUANCE OF WARRANTS AND FORM, EXECUTION,
DELIVERY AND REGISTRATION OF WARRANT CERTIFICATES
SECTION 1.01. Issuance of Warrants............................................2
SECTION 1.02. Form, Execution and Delivery of Warrant
Certificates..........................................................3
SECTION 1.03. Transfer of Warrants............................................5
SECTION 1.04. Lost, Stolen, Mutilated or Destroyed Warrant
Certificates..........................................................7
SECTION 1.05. Cancellation of Warrant Certificates............................7
SECTION 1.06. Treatment of Holders [IF WARRANTS ARE TO BE
ISSUED IN BOOK-ENTRY FORM: and Beneficial Owners] of
Warrant Certificates..................................................8
ARTICLE II
EXERCISE PRICE, DURATION AND EXERCISE OF WARRANTS
SECTION 2.01. Exercise Price..................................................9
SECTION 2.02. Duration of Warrants............................................9
SECTION 2.03. Exercise of Warrants............................................9
SECTION 2.04. Adjustment Under Certain Circumstances.........................12
ARTICLE III
OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS
[IF WARRANTS ARE TO BE ISSUED IN BOOK-ENTRY FORM:
AND BENEFICIAL OWNERS] OF WARRANTS
SECTION 3.01. No Rights as Holders of Warrant Securities
Conferred by Warrants or Warrant Certificates........................12
SECTION 3.02. Holder [If Warrants are to be issued in Book-
Entry form: and Beneficial Owner] of Warrant May
Enforce Rights.......................................................13
- i -
<PAGE>
ARTICLE IV
CONCERNING THE WARRANT AGENT
SECTION 4.01. Warrant Agent..................................................13
SECTION 4.02. Limitations on Warrant Agent's Obligations
....................................................................13
SECTION 4.03. Compliance With Applicable Laws................................15
SECTION 4.04. Resignation and Appointment of Successor.......................16
ARTICLE V
MISCELLANEOUS
SECTION 5.01. Amendments.....................................................18
SECTION 5.02. Merger, Consolidation, Sale, Transfer or
Conveyance...........................................................19
SECTION 5.03. Notices and Demands to the Company and
Warrant Agent........................................................20
SECTION 5.04. Addresses......................................................20
SECTION 5.05. GOVERNING LAW..................................................20
SECTION 5.06. Delivery of Prospectus.........................................20
SECTION 5.07. Obtaining of Governmental Approvals............................20
SECTION 5.08. Payment of Taxes...............................................21
SECTION 5.09. Benefits of Warrant Agreement..................................21
SECTION 5.10. Headings.......................................................21
SECTION 5.11. Severability...................................................21
SECTION 5.12. Counterparts...................................................21
SECTION 5.13. Inspection of Agreement........................................21
EXHIBITS
EXHIBIT A. Form of Warrant Certificate
- ii -
<PAGE>
[DEBT] [[CLASS A] PREFERRED STOCK] [COMMON STOCK]
[DEPOSITARY SHARES] WARRANT AGREEMENT
[DEBT] [[CLASS A] PREFERRED STOCK] [COMMON STOCK] [DEPOSITARY SHARES]
WARRANT AGREEMENT, dated as of ________ __, ____ (as modified, amended or
supplemented, this "Agreement"), between FIRST UNION CORPORATION, a North
Carolina corporation (the "Company") and [NAME OF WARRANT AGENT], a
_________________, as Warrant Agent (the "Warrant Agent").
W I T N E S S E T H:
[If offer consists of Debt Securities with Warrants AND/OR Warrants to
Purchase Debt Securities: WHEREAS, the Company has entered into an Indenture,
dated as of April 1, 1983, as amended by supplemental indentures dated as of May
17, 1986, July 1, 1988 and August 1, 1990 (the "Senior Indenture"), between the
Company and The Chase Manhattan Bank (formerly Chemical Bank) as trustee,
providing for the issuance from time to time of its unsecured senior debentures,
notes or other evidences of indebtedness, and an Indenture, dated as of March
15, 1986, as amended by supplemental indentures dated as of August 1, 1990,
November 15, 1992 and February 7, 1996 (the "Subordinated Indenture", and
together with the Senior Indenture, the "Indentures"), between the Company and
Harris Trust and Savings Bank, as successor trustee to The Bank of New York
(formerly Irving Trust Company) (together with the trustee under the Senior
Indenture, the "Trustees"), providing for the issuance from time to time of its
unsecured subordinated debentures, notes or other evidences of indebtedness
(together with the securities issuable under the Senior Indenture, the "Debt
Securities"), to be issued in one or more series as provided in each Indenture;
and]
[If Securities and Warrants are to be offered together: WHEREAS, the
Company proposes to sell [title of Securities being Offered] (the "Offered
Securities") together with warrants (each, a "Warrant") representing the right
to purchase [title of Securities purchasable upon exercise of Warrants] [If
Warrants for Depositary Shares are to be offered: , each representing a 1/__th
interest in a share of [title of securities represented by Depositary Shares]]
(the "Warrant Securities" [If Warrants for Depositary Shares are to be offered:
, which term shall also refer, as appropriate, to such [title of securities
represented by Depositary Shares]), such warrant certificates and other
- 1 -
<PAGE>
warrant certificates issued pursuant to this Agreement being herein called the
"Warrant Certificates"; and]
[If offer consists of Warrants alone: WHEREAS, the Company proposes to
sell warrant certificates evidencing one or more warrants (each, a "Warrant")
representing the right to purchase [title of Securities purchasable upon
exercise of Warrants] [If Warrants for Depositary Shares are to be offered: ,
each representing a 1/__th interest in a share of [title of securities
represented by the Depositary Shares]] (the "Warrant Securities" [If Warrants
for Depositary Shares are to be offered: , which term shall also refer, as
appropriate, to such [title of securities represented by the Depositary
Shares]), such warrant certificates and other warrant certificates issued
pursuant to this Agreement being herein called the "Warrant Certificates"; and]
WHEREAS, the Company desires the Warrant Agent to act on behalf of the
Company, and the Warrant Agent is willing so to act, in connection with the
issuance, transfer, exchange, exercise and cancellation of the Warrants, and the
Company wishes to set forth in this Agreement, among other things, the
provisions of the Warrants, the form of the Warrant Certificates evidencing the
Warrants and the terms and conditions upon which the Warrants may be issued,
transferred, exchanged, exercised and canceled;
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements herein contained, the parties hereto agree as follows:
ARTICLE I
ISSUANCE OF WARRANTS AND FORM, EXECUTION,
DELIVERY AND REGISTRATION OF WARRANT CERTIFICATES
SECTION 1.01. Issuance of Warrants. Each Warrant shall represent the
right, subject to the provisions contained herein and therein, to purchase
[________] Warrant Securities [in the aggregate principal amount of $_____] at
the Exercise Price set forth in Section 2.01. [If Securities and Warrants are to
be offered together: Warrants shall be issued in units with the Offered
Securities [If Warrants are not immediately detachable: and shall not be
separately transferable [Unless Warrants are not detachable: before ________ __,
____ (the "Detachment Date")]].] [If Warrants are to be offered separately:
Warrants shall be issued as a separate security and shall be transferable from
and after the date of issuance.] [If Warrants are to be offered in Book-Entry
form: [All] [A portion] of the
- 2 -
<PAGE>
Warrants shall initially be represented by one or more global certificates
(each, a "Global Warrant Certificate").] [If Securities and Warrants are to be
offered together and in definitive form: Each Warrant Certificate included in
such a unit shall evidence [_______] Warrants for each [$_____ principal amount
of] [_______] Offered Securities included in such unit.] [If Warrants are to be
offered separately and in definitive form: Each Warrant Certificate shall
evidence [_______] Warrants.]
SECTION 1.02. Form, Execution and Delivery of Warrant
Certificates.
(a) One or more Warrant Certificates evidencing Warrants to purchase
not more than [____] [$_______ in aggregate principal amount of] Warrant
Securities (except as provided in Sections 1.03, 1.04 and 2.03(e)) may be
executed by the Company and delivered to the Warrant Agent upon the execution of
this Warrant Agreement or from time to time thereafter.
(b) Each Warrant Certificate, whenever issued, shall be in registered
form substantially in the form set forth in Exhibit A hereto, with such
appropriate insertions, omissions, substitutions and other variations as are
required or permitted by this Agreement. [If Warrants are issued in Book-Entry
form: Each Global Warrant Certificate shall bear such legend or legends as may
be required by the Depository in order for it to accept the Warrants for its
book-entry settlement system.] Each Warrant Certificate shall be printed,
lithographed, typewritten, mimeographed or engraved on steel engraved borders or
otherwise reproduced in any other manner as may be approved by the officers
executing the same (such execution to be conclusive evidence of such approval)
and may have such letters, numbers or other marks of identification or
designation and such legends or endorsements printed, lithographed or engraved
thereon as the officers of the Company executing the same may approve (such
execution to be conclusive evidence of such approval) and as are not
inconsistent with the provisions of this Agreement, or as may be required to
comply with any law or with any rule or regulation made pursuant thereto, or
with any regulation of any stock exchange on which the Warrants [If Securities
and Warrants are to be offered together: , the Offered Securities] or the
Warrant Securities may be listed, or to conform to usage. Each Warrant
Certificate shall be signed on behalf of the Company by its Chairman of the
Board, President or any Executive or Senior Vice President. The signature of any
such officer on any Warrant Certificate may be manual or facsimile. Each Warrant
Certificate, when so signed on
- 3 -
<PAGE>
behalf of the Company, shall be delivered to the Warrant Agent together with an
order for the countersignature and delivery of such Warrants.
(c) The Warrant Agent shall, upon receipt of any Warrant Certificate
duly executed on behalf of the Company, countersign such Warrant Certificate and
deliver such Warrant Certificate to or upon the order of the Company. Each
Warrant Certificate shall be dated the date of its countersignature.
(d) No Warrant Certificate shall be entitled to any benefit under this
Agreement or be valid or obligatory for any purpose, and no Warrant evidenced
thereby may be exercised, unless such Warrant Certificate has been countersigned
by the manual signature of the Warrant Agent. Such signature by the Warrant
Agent upon any Warrant Certificate executed by the Company shall be conclusive
evidence that such Warrant Certificate has been duly issued under the terms of
this Agreement.
(e) If any officer of the Company who has signed any Warrant
Certificate either manually or by facsimile signature shall cease to be such
officer before such Warrant Certificate shall have been countersigned and
delivered by the Warrant Agent, such Warrant Certificate nevertheless may be
countersigned and delivered as though the person who signed such Warrant
Certificate had not ceased to be such officer of the Company; and any Warrant
Certificate may be signed on behalf of the Company by such persons as, at the
actual date of the execution of such Warrant Certificate, shall be the proper
officers of the Company as specified in this Section 1.02, regardless of whether
at the date of the execution of this Agreement any such person was such officer.
(f) The Holders shall [If Warrants are to be issued in Book-Entry form:
, except as stated below with respect to Warrants evidenced by a Global Warrant
Certificate,] be entitled to receive Warrants in physical, certificated form.
[If Warrants are to be issued in Book-Entry form: (g) A Global Warrant
Certificate may be exchanged for a new Global Warrant Certificate, or one or
more new Global Warrant Certificates may be issued, to reflect the issuance by
the Company of additional Warrants. To effect such an exchange, the Company
shall deliver to the Warrant Agent one or more new Global Warrant Certificates
duly executed on behalf of the Company as provided in Section 1.02. The Warrant
Agent shall authenticate each new Global Warrant Certificate as provided in
Section 1.02 and shall deliver
- 4 -
<PAGE>
each new Global Warrant Certificate to the Depository. The Warrant Agent shall
cancel each Global Warrant Certificate delivered to it by the Depository in
exchange therefor, if any.]
SECTION 1.03. Transfer of Warrants.
[If Warrants are to be issued in Book-Entry form: (a) [All] [A
portion] of the Warrants shall initially be represented by one or more Global
Warrant Certificates deposited with [the Depository Trust Company] (the
"Depository") and registered in the name of [Cede & Co.], a nominee of the
Depository. The Depository, or such other entity as is agreed to by the
Depository, may hold each Global Warrant Certificate as custodian for
Depository. Except as provided for in Section 1.03(b) hereof, no person
acquiring Warrants traded on any securities exchange with book-entry settlement
through the Depository shall receive or be entitled to receive physical delivery
of definitive Warrant Certificates evidencing such Warrants. Ownership of
beneficial interests in the Warrants shall be shown on, and the transfer of such
ownership shall be effected through, records maintained by (i) the Depository or
its nominee for each Global Warrant Certificate, or (ii) institutions that have
accounts with the Depository (such institution, with respect to a Warrant in its
account, a "Participant").]
[If Warrants are to be issued in Book-Entry form: (b) If the Depository
subsequently ceases to make its book-entry settlement system available for the
Warrants, the Company may instruct the Warrant Agent regarding making other
arrangements for book-entry settlement. In the event that the receipts are not
eligible for, or it is no longer necessary to have the Warrants available in,
book-entry form, the Warrant Agent shall provide written instructions to the
Depository to deliver to the Warrant Agent for cancellation each Global Warrant
Certificate, and the Company shall instruct the Warrant Agent to deliver to the
Depository definitive Warrant Certificates in physical form evidencing such
Warrants. Such definitive Warrant Certificates shall be in the form annexed
hereto as Exhibit A with appropriate insertions, modifications and omissions, as
provided above.]
[If Securities and Warrants are to be offered together: (c) [If
Warrants are not immediately detachable: Prior to the Detachment Date,] Warrants
may be transferred or exchanged only together with the Offered Security to which
such Warrant is attached, and only for the purpose of effecting, or in
conjunction with, a transfer or exchange of such Offered Security. Furthermore,
[If Warrants are not
- 5 -
<PAGE>
immediately detachable: on or prior to the Detachment Date,] each transfer of an
Offered Security on the register relating to such Offered Securities shall
operate also to transfer the Warrants to which such Offered Security was
initially attached. [If Warrants are not immediately detachable: From and after
the Detachment Date, the above provisions shall be of no further force and
effect.]
(d) A Warrant Certificate may be transferred at the option of the
Holder thereof upon surrender of such Warrant Certificate at the corporate trust
office of the Warrant Agent, properly endorsed or accompanied by appropriate
instruments of transfer and written instructions for transfer, all in form
satisfactory to the Company and the Warrant Agent [If Warrants are to be issued
in Book-Entry form: ; provided, however, that except as otherwise provided
herein or in any Global Warrant Certificate, each Global Warrant Certificate may
be transferred only in whole and only to the Depository, to another nominee of
the Depository, to a successor depository, or to a nominee of a successor
depository]. Upon any such registration of transfer, the Company shall execute,
and the Warrant Agent shall countersign and deliver, as provided in Section
1.02, in the name of the designated transferee a new Warrant Certificate or
Warrant Certificates of any authorized denomination evidencing in the aggregate
a like number of unexercised Warrants.
(e) [If Warrants are not immediately detachable: After the Detachment
Date,] Upon surrender at the corporate office of the Warrant Agent, properly
endorsed or accompanied by appropriate instruments of transfer and written
instructions for such exchange, all in form satisfactory to the Company and the
Warrant Agent, one or more Warrant Certificates may be exchanged for one or more
Warrant Certificates in any other authorized denominations; provided that such
new Warrant Certificate(s) evidence the same aggregate number of Warrants as the
Warrant Certificate(s) so surrendered. Upon any such surrender for exchange, the
Company shall execute, and the Warrant Agent shall countersign and deliver, as
provided in Section 1.02, in the name of the Holder of such Warrant
Certificates, the new Warrant Certificates.
(f) The Warrant Agent shall keep, at its corporate trust office, books
in which, subject to such reasonable regulations as it may prescribe, it shall
register Warrant Certificates in accordance with Section 1.02 and transfers,
exchanges, exercises and cancellations of outstanding Warrant Certificates.
Whenever any Warrant Certificates are surrendered for transfer or exchange in
accordance with this Section 1.03, an authorized officer of the Warrant Agent
- 6 -
<PAGE>
shall manually countersign and deliver the Warrant Certificates which the Holder
making the transfer or exchange is entitled to receive.
(g) No service charge shall be made for any transfer or exchange of
Warrant Certificates, but the Company may require payment of a sum sufficient to
cover any stamp or other tax or other governmental charge that may be imposed in
connection with any such transfer or exchange.
SECTION 1.04. Lost, Stolen, Mutilated or Destroyed Warrant
Certificates. Upon receipt by the Company and the Warrant Agent of evidence
satisfactory to them of the ownership of and the loss, theft, destruction or
mutilation of any Warrant Certificate and of indemnity satisfactory to them and,
in the case of mutilation, upon surrender of such Warrant Certificate to the
Warrant Agent for cancellation, then, in the absence of notice to the Company or
the Warrant Agent that such Warrant Certificate has been acquired by a bona fide
purchaser, the Company shall execute, and an authorized officer of the Warrant
Agent shall manually countersign and deliver, in exchange for or in lieu of the
lost, stolen, destroyed or mutilated Warrant Certificate, a new Warrant
Certificate of the same tenor and for a like number of Warrants. No service
charge shall be made for any replacement of Warrant Certificates, but the
Company may require the payment of a sum sufficient to cover any stamp or other
tax or other governmental charge that may be imposed in connection with any such
exchange. To the extent permitted under applicable law, the provisions of this
Section 1.04 are exclusive with respect to the replacement of mutilated, lost,
stolen or destroyed Warrant Certificates and shall preclude any and all other
rights or remedies.
SECTION 1.05. Cancellation of Warrant Certificates. Any Warrant
Certificate surrendered to the Warrant Agent for transfer, exchange or exercise
of the Warrants evidenced thereby shall be promptly canceled by the Warrant
Agent and shall not be reissued and, except as expressly permitted by this
Agreement, no Warrant Certificate shall be issued hereunder in lieu thereof. The
Warrant Agent shall deliver to the Company from time to time or otherwise
dispose of canceled Warrant Certificates in a manner satisfactory to the
Company. Any Warrant Certificate surrendered to the Company for transfer,
exchange or exercise of the Warrants evidenced thereby shall be promptly
delivered to the Warrant Agent and such transfer, exchange or exercise shall not
be effective until such Warrant Certificate has been received by the Warrant
Agent.
- 7 -
<PAGE>
SECTION 1.06. Treatment of Holders [IF WARRANTS ARE TO BE ISSUED IN
BOOK-ENTRY FORM: and Beneficial Owners] of Warrant Certificates. (a) The term
"Holder", as used herein, shall mean any person in whose name at the time any
Warrant Certificate shall be registered upon the books to be maintained by the
Warrant Agent for that purpose [If Securities and Warrants that are not
immediately detachable are offered: or, prior to the Detachment Date, the person
in whose name the Offered Security to which such Warrant Certificate was
initially attached is registered upon the register relating to such Offered
Securities. At all times prior to the Detachment Date, the Company will, or will
cause the registrar of the Offered Securities to, make available to the Warrant
Agent such information as to holders of the Offered Securities as may be
necessary to keep the Warrant Agent's records current]. [If Warrants are to be
issued in Book-Entry form: The Holder of each Global Warrant Certificate shall
initially be [Cede & Co.], a nominee of the Depository.]
[If Warrants are to be issued in Book-Entry Form: (b) The term
"Beneficial Owner" as used herein shall mean any person in whose name ownership
of beneficial interests in Warrants evidenced by a Global Warrant Certificate is
recorded in the records maintained by the Depository or its nominee, or by a
Participant [If Securities and Warrants that are not immediately detachable are
offered: , or, prior to the Detachment Date, the person in whose name the
Offered Security to which such Warrant Certificate was initially attached is
registered upon the register relating to such Offered Securities].]
( ) Every Holder [If Warrants are to be issued in Book-Entry form: and
every Beneficial Owner] consents and agrees with the Company, the Warrant Agent
and with every subsequent Holder [If Warrants are to be issued in Book- Entry
form: and Beneficial Owner] that until the Warrant Certificate is transferred on
the books of the Warrant Agent, the Company and the Warrant Agent may treat the
registered Holder of such Warrant Certificate as the absolute owner of the
Warrants evidenced thereby for any purpose and as the person entitled to
exercise the rights attaching to the Warrants evidenced thereby, any notice to
the contrary notwithstanding.
- 8 -
<PAGE>
ARTICLE II
EXERCISE PRICE, DURATION AND EXERCISE OF WARRANTS
SECTION 2.01. Exercise Price. The exercise price of each Warrant shall
be $________ (the "Exercise Price") [modify as appropriate to reflect terms of
offered Warrants].
SECTION 2.02. Duration of Warrants. [Subject to the limitations set
forth herein,] Each Warrant may be exercised in whole but not in part [Unless
Warrants may be exercised on only one date: on any Business Day (as defined
below) occurring during the period (the "Exercise Period") commencing on [its
date of issuance] [_________ __, ____] and ending at 5:00 P.M., New York time,]
on __________ __, ____ (the "Expiration Date"). Each Warrant remaining
unexercised after 5:00 P.M., New York time, on the Expiration Date shall become
void, and all rights of the Holder under this Agreement shall cease.
As used herein, the term "Business Day" means any day which is not a
Saturday or Sunday and is not a legal holiday or a day on which banking
institutions generally are authorized or obligated by law or regulation to close
in New York and North Carolina.
SECTION 2.03. Exercise of Warrants.
(a) A Holder may exercise a Warrant by delivering, not later than 5:00
P.M., New York time, on [Unless Warrants may be exercised on only one date: any
Business Day during the Exercise Period (the "Exercise Date")] [If Warrants may
be exercised on only one date: the Expiration Date] to the Warrant Agent at its
corporate trust department (i) the Warrant Certificate evidencing the Warrants
to be exercised, [If Warrants are to be issued in Book-Entry form: and, in the
case of a Global Warrant Certificate, the Warrants to be exercised (the
"Book-Entry Warrants") free on the records of the Depository to an account of
the Warrant Agent at the Depository designated for such purpose in writing by
the Warrant Agent to the Depository from time to time,] (ii) an election to
purchase the Warrant Securities ("Election to Purchase"), properly completed and
executed by the Holder on the reverse of the Warrant Certificate [If Warrants
are to be issued in Book-Entry form: or, in the case of a Global Warrant
Certificate, properly executed by the Participant and substantially in the form
included on the reverse of each Warrant Certificate,] and (iii) the Exercise
Price for each Warrant to be exercised in lawful money of the United
- 9 -
<PAGE>
States of America by certified or official bank check or by bank wire transfer
in immediately available funds. If any of (a) the Warrant Certificate [If
Warrants are to be issued in Book-Entry form: or the Book-Entry Warrants,] (b)
the Election to Purchase, or (c) the Exercise Price therefor, is received by the
Warrant Agent after 5:00 P.M., New York time, on [Unless Warrants may be
exercised on only one date: the specified Exercise Date, the Warrants will be
deemed to be received and exercised on the Business Day next succeeding the
Exercise Date. If the date specified as the Exercise Date is not a Business Day,
the Warrants will be deemed to be received and exercised on the next succeeding
day which is a Business Day. If the Warrants are received or deemed to be
received after] the Expiration Date, the exercise thereof will be null and void
and any funds delivered to the Warrant Agent will be returned to the Holder [If
Warrants are to be issued in Book-Entry form: or Participant, as the case may
be,] as soon as practicable. In no event will interest accrue on funds deposited
with the Warrant Agent in respect of an exercise or attempted exercise of
Warrants. The validity of any exercise of Warrants will be determined by the
Warrant Agent in its sole discretion and such determination will be final and
binding upon the Holder and the Company. Neither the Company nor the Warrant
Agent shall have any obligation to inform a Holder of the invalidity of any
exercise of Warrants. The Warrant Agent shall deposit all funds received by it
in payment of the Exercise Price in the account of the Company maintained with
the Warrant Agent for such purpose and shall advise the Company by telephone at
the end of each day on which funds for the exercise of the Warrants are received
of the amount so deposited to its account. The Warrant Agent shall promptly
confirm such telephonic advice to the Company in writing.
(b) The Warrant Agent shall, by 11:00 A.M. on the Business Day
following the [Unless Warrants may be exercised on only one date: Exercise Date
of any Warrant] [If Warrants may be exercised on only one date: Expiration
Date], advise the Company and the [Trustee under the Indenture applicable to]
[the transfer agent and registrar in respect of] the Warrant Securities issuable
upon such exercise as to the number of Warrants exercised in accordance with the
terms and conditions of this Agreement, the instructions of each Holder [If
Warrants are to be issued in Book-entry Form: or Participant, as the case may
be,] with respect to delivery of the Warrant Securities issuable upon such
exercise, and the delivery of definitive Warrant Certificates [If Warrants are
to be issued in Book-Entry form: or one or more Global Warrant Certificates, as
appropriate,] evidencing the balance, if any, of the Warrants remaining after
such
- 10 -
<PAGE>
exercise, and such other information as the Company or such [Trustee] [transfer
agent and registrar] shall reasonably require.
(c) The Company shall, by 5:00 P.M., New York time, on the third
Business Day next succeeding the [Unless Warrants may be exercised on only one
date: Exercise Date of any Warrant] [If Warrants may be exercised on only one
date: Expiration Date], execute, issue and deliver to the Warrant Agent,
[pursuant to the Indenture applicable to the Warrant Securities, the Warrant
Securities, duly authenticated by the Trustee of such Indenture and in
authorized denominations] [the Warrant Securities] to which such Holder is
entitled, in fully registered form, registered in such name or names as may be
directed by such Holder [If Warrants are to be issued in Book-Entry form: or the
Participant, as the case may be]. Upon receipt of such Warrant Securities, the
Warrant Agent shall, by 5:00 P.M., New York time, on the fifth Business Day next
succeeding [Unless Warrants may be exercised on only one date: such Exercise
Date] [If Warrants may be exercised on only one date: the Expiration Date],
transmit such Warrant Securities, to or upon the order of the Holder [If
Warrants are to be issued in Book-Entry form: or Participant, as the case may
be,] together with, or preceded by the prospectus referred to in Section 5.06
hereof. The Company agrees that it will provide such information and documents
to the Warrant Agent as may be necessary for the Warrant Agent to fulfill its
obligations hereunder.
(d) The accrual of [interest] [dividends], if any, on the Warrant
Securities issued upon the valid exercise of any Warrant will be governed by the
terms of the applicable [Indenture] [articles of amendment] and such Warrant
Securities. From and after the issuance of such Warrant Securities, the former
Holder of the Warrants exercised will be entitled to the benefits of the
[Indenture] [articles of amendment] under which such Warrant Securities are
issued and such former Holder's right to receive payments of [principal of (and
premium, if any) and interest, if any, on] [dividends and any other amounts
payable in respect of] the Warrant Securities shall be governed by, and shall be
subject to, the terms and provisions of such [Indenture] [articles of amendment]
and the Warrant Securities.
(e) Warrants may be exercised only in whole numbers of Warrants.
[Unless Warrants may be exercised on only one date: If fewer than all of the
Warrants evidenced by a Warrant Certificate are exercised, a new Warrant
Certificate for the number of Warrants remaining unexercised shall be executed
by the Company and countersigned by the Warrant
- 11 -
<PAGE>
Agent as provided in Section 1.02 hereof, and delivered to the Holder at the
address specified on the books of the Warrant Agent or as otherwise specified by
such Holder.]
(f) The Company shall not be required to pay any stamp or other tax or
other governmental charge required to be paid in connection with any transfer
involved in the issue of the Warrant Securities; and in the event that any such
transfer is involved, the Company shall not be required to issue or deliver any
Warrant Securities until such tax or other charge shall have been paid or it has
been established to the Company's satisfaction that no such tax or other charge
is due.
[If Warrants for Common Stock are offered: SECTION 2.04. Adjustment
Under Certain Circumstances. The Exercise Price and the number of Warrant
Securities purchasable upon the exercise of each Warrant shall be subject to
adjustment upon (i) the issuance of a stock dividend to the holders of the
outstanding shares of Warrant Securities or a combination, subdivision or
reclassification of the Warrant Securities; (ii) the issuance of rights,
warrants or options to all holders of the Warrant Securities entitling the
holders thereof to purchase Warrant Securities for an aggregate consideration
per share less than the current market price per share of the Warrant
Securities; or (iii) any distribution by the Company to the holders of the
Warrant Securities of evidences of indebtedness of the Company or of assets
(excluding cash dividends or distributions payable out of consolidated earnings
and earned surplus and dividends or distributions referred to in (i) above);
provided that no such adjustment in the number of Warrant Securities purchasable
upon exercise of the Warrants will be required until cumulative adjustments
require an adjustment of at least 1% of such number. No fractional shares will
be issued upon exercise of Warrants, but the Company will pay the cash value of
any fractional shares otherwise issuable. The adjustments to be made under this
Section 2.03 shall be determined by the Warrant Agent and such determination
shall be final and binding upon the Holders and the Company.]
ARTICLE III
OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS
[If Warrants are to be issued in Book-Entry Form:
AND BENEFICIAL OWNERS] OF WARRANTS
SECTION 3.01. No Rights as Holders of Warrant Securities Conferred by
Warrants or Warrant Certificates.
- 12 -
<PAGE>
No Warrant Certificate or Warrant evidenced thereby shall entitle the Holder
thereof to any of the rights of a holder of any Warrant Securities, including,
without limitation, [the right to receive the payments of principal of (and
premium, if any) and interest, if any, on Debt Securities purchasable upon such
exercise or to enforce any of the covenants in the Indenture] [the right to
receive dividends, if any, or payments upon the liquidation, dissolution or
winding up of the Company or to exercise voting rights, if any].
SECTION 3.02. Holder [If Warrants are to be issued in Book-Entry form:
and Beneficial Owner] of Warrant May Enforce Rights. Notwithstanding any of the
provisions of this Agreement, any Holder [If Warrants are to be issued in
Book-Entry form: and any Beneficial Owner] of any Warrant, without the consent
of the Warrant Agent or the Holder of any Warrant, may, on such Holder's [If
Warrants are to be issued in Book-Entry form: or Beneficial Owner's] own behalf
and for his own benefit, enforce, and may institute and maintain any suit,
action or proceeding against the Company to enforce, or otherwise in respect of,
such Holder's [If Warrants are to be issued in Book-Entry form: or Beneficial
Owner's] right to exercise the Warrants evidenced by any Warrant Certificate in
the manner provided in this Agreement and such Warrant Certificate.
ARTICLE IV
CONCERNING THE WARRANT AGENT
SECTION 4.01. Warrant Agent. The Company hereby appoints [Name of
Warrant Agent] as Warrant Agent of the Company in respect of the Warrants upon
the terms and subject to the conditions herein set forth, and [Name of Warrant
Agent] hereby accepts such appointment. The Warrant Agent shall have the powers
and authority granted to and conferred upon it hereby and such further powers
and authority to act on behalf of the Company as the Company may hereafter grant
to or confer upon it.
SECTION 4.02. Limitations on Warrant Agent's Obligations. The Warrant
Agent accepts its obligations herein set forth upon the terms and conditions
hereof, including the following, to all of which the Company agrees and to all
of which the rights hereunder of the Holders from time to time shall be subject:
(a) Compensation and Indemnification. The Company agrees to
pay the Warrant Agent compensation to
- 13 -
<PAGE>
be agreed upon with the Company for all services rendered by the
Warrant Agent and to reimburse the Warrant Agent for all reasonable
out-of-pocket expenses (including reasonable counsel fees) incurred by
the Warrant Agent in connection with the services rendered by it
hereunder. The Company also agrees to indemnify the Warrant Agent for,
and to hold it harmless against, any loss, liability or expense
incurred without negligence, bad faith or breach of this Agreement on
the part of the Warrant Agent, arising out of or in connection with its
acting as Warrant Agent hereunder.
(b) Agent for the Company. In acting in the capacity of
Warrant Agent under this Agreement, the Warrant Agent is acting solely
as agent of the Company and does not assume any obligation or
relationship of agency or trust with any of the owners or holders of
the Warrants except as expressly set forth herein.
(c) Counsel. The Warrant Agent may consult with counsel
satisfactory to it (which may be counsel to the Company), and the
advice of such counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in accordance with the advice of such
counsel.
(d) Documents. The Warrant Agent shall be protected and shall
incur no liability for or in respect of any action taken or thing
suffered by it in reliance upon any notice, direction, consent,
certificate, affidavit, statement or other paper or document reasonably
believed by it to be genuine and to have been presented or signed by
the proper parties.
(e) Certain Transactions. The Warrant Agent, and its officers,
directors and employees, may become the owner of, or acquire any
interest in, any Warrant, with the same rights that it or they would
have were it not the Warrant Agent hereunder, and, to the extent permit
ted by applicable law, it or they may engage or be interested in any
financial or other transaction with the Company and may act on, or as a
depositary, trustee or agent for, any committee or body of holders of
Warrants [If Securities and Warrants are being offered together: ,
Offered Securities] or Warrant Securities, or other securities or
obligations of the Company as freely as if it were not the Warrant
Agent hereunder. Nothing in this Agreement shall be deemed to prevent
the Warrant Agent from acting as trustee under either Indenture.
- 14 -
<PAGE>
(f) No Liability for Interest. The Warrant Agent shall not be
under any liability for interest on any monies at any time received by
it pursuant to any of the provisions of this Agreement.
(g) No Liability for Invalidity. The Warrant Agent shall not
be under any responsibility with respect to the validity or sufficiency
of this Agreement or the execution and delivery hereof (except the due
execution and delivery hereof by the Warrant Agent) or with respect to
the validity or execution of the Warrant Certificates (except its
countersignature thereon).
(h) No Responsibility for Recitals. The recitals contained
herein and in the Warrant Certificates (except as to the Warrant
Agent's countersignature thereon) shall be taken as the statements of
the Company and the Warrant Agent assumes no responsibility hereby for
the correctness of the same.
(i) No Implied Obligations. The Warrant Agent shall be
obligated to perform such duties as are specifically set forth herein
and no implied duties or obligations shall be read into this Agreement
against the Warrant Agent. The Warrant Agent shall not be under any
obligation to take any action hereunder which may tend to involve it in
any expense or liability, the payment of which within a reasonable time
is not, in its opinion, assured to it. The Warrant Agent shall not be
accountable or under any duty or responsibility for the use by the
Company of any Warrant Certificate authenticated by the Warrant Agent
and delivered by it to the Company pursuant to this Agreement or for
the application by the Company of the proceeds of the issue and sale,
or exercise, of the Warrants. The Warrant Agent shall have no duty or
responsibility in case of any default by the Company in the performance
of its covenants or agreements contained herein or in any Warrant
Certificate or in the case of the receipt of any written demand from a
Holder with respect to such default, including, without limiting the
generality of the foregoing, any duty or responsibility to initiate or
attempt to initiate any proceedings at law or otherwise or, except as
provided in Section 5.03 hereof, to make any demand upon the Company.
SECTION 4.03. Compliance With Applicable Laws. The Warrant
Agent agrees to comply with all applicable federal and state laws imposing
obligations on it in respect of the services rendered by it under this Agreement
and in
- 15 -
<PAGE>
connection with the Warrants, including (but not limited to) the provisions of
United States federal income tax laws regarding information reporting and backup
withholding. The Warrant Agent expressly assumes all liability for its failure
to comply with any such laws imposing obligations on it, including (but not
limited to) any liability for its failure to comply with any applicable
provisions of United States federal income tax laws regarding information
reporting and backup withholding.
SECTION 4.04. Resignation and Appointment of Successor.
(a) The Company agrees, for the benefit of the Holders from
time to time, that there shall at all times be a Warrant Agent hereunder until
all the Warrants issued hereunder have been exercised or have expired in
accordance with their terms, which Warrant Agent shall be a bank or trust
company organized under the laws of the United States of America or one of the
states thereof, which is authorized under the laws of the jurisdiction of its
organization to exercise corporate trust powers, has a combined capital and
surplus of at least $50,000,000 and has an office or an agent's office in the
United States of America.
(b) The Warrant Agent may at any time resign as such agent by
giving written notice to the Company of such intention on its part, specifying
the date on which it desires such resignation to become effective; provided that
such date shall not be less than three months after the date on which such
notice is given, unless the Company agrees to accept such notice less than three
months prior to such date of effectiveness. The Company may remove the Warrant
Agent at any time by giving written notice to the Warrant Agent of such removal,
specifying the date on which it desires such removal to become effective. Such
resignation or removal shall take effect upon the appointment by the Company, as
hereinafter provided, of a successor Warrant Agent (which shall be a bank or
trust company qualified as set forth in Section 4.04(a)) and the acceptance of
such appointment by such successor Warrant Agent. The obligation of the Company
under Section 4.02(a) shall continue to the extent set forth therein
notwithstanding the resignation or removal of the Warrant Agent.
(c) If at any time the Warrant Agent shall resign, or shall
cease to be qualified as set forth in Section 4.04(a), or shall be removed, or
shall become incapable of acting, or shall be adjudged a bankrupt or insolvent,
or shall file a petition seeking relief under any applicable Federal or State
bankruptcy or insolvency law or
- 16 -
<PAGE>
similar law, or make an assignment for the benefit of its creditors or consent
to the appointment of a receiver, conservator or custodian of all or any
substantial part of its property, or shall admit in writing its inability to pay
or to meet its debts as they mature, or if a receiver or custodian of it or of
all or any substantial part of its property shall be appointed, or if an order
of any court shall be entered for relief against it under the provisions of any
applicable Federal or State bankruptcy or similar law, or if any public officer
shall have taken charge or control of the Warrant Agent or of its property or
affairs, for the purpose of rehabilitation, conservation or liquidation, a
successor Warrant Agent, qualified as set forth in Section 4.04(a), shall be
appointed by the Company by an instrument in writing, filed with the successor
Warrant Agent. Upon the appointment as herein provided of a successor Warrant
Agent and acceptance by the latter of such appointment, the Warrant Agent so
superseded shall cease to be Warrant Agent under this Agreement.
(d) Any successor Warrant Agent appointed under this Agreement
shall execute, acknowledge and deliver to its predecessor and to the Company an
instrument accepting such appointment, and thereupon such successor Warrant
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 Warrant Agent under
this Agreement, and such predecessor, upon payment of its charges and
disbursements then unpaid, shall thereupon become obligated to transfer, deliver
and pay over, and such successor Warrant Agent shall be entitled to receive, all
monies, securities and other property on deposit with or held by such
predecessor, as Warrant Agent under this Agreement.
(e) Any corporation into which the Warrant Agent may be merged
or converted or any corporation with which the Warrant Agent may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Warrant Agent shall be a party, or any corporation to
which the Warrant Agent shall sell or otherwise transfer all or substantially
all the assets and business of the Warrant Agent, in each case provided that it
shall be qualified as set forth in Section 4.04(a), shall be the successor
Warrant Agent under this Agreement without the execution or filing of any paper
or any further act on the part of any of the parties to this Agreement,
including, without limitation, any successor to the Warrant Agent first named
above.
- 17 -
<PAGE>
ARTICLE V
MISCELLANEOUS
SECTION 5.01. Amendments.
(a) This Agreement and any Warrant Certificate may be amended
by the parties hereto by executing a supplemental warrant agreement (a
"Supplemental Agreement"), without the consent of the Holder of any Warrant, for
the purpose of (i) curing any ambiguity, or curing, correcting or supplementing
any defective provision contained herein, or making any other provisions with
respect to matters or questions arising under this Agreement that is not
inconsistent with the provisions of this Agreement or the Warrant Certificates,
(ii) evidencing the succession of another corporation to the Company and the
assumption by any such successor of the covenants of the Company contained in
this Warrant Agreement and the Warrants, (iii) evidencing and providing for the
acceptance of appointment by a successor Warrant Agent with respect to the
Warrants, [If Warrants are to be issued in Book-Entry form: (iv) evidencing and
providing for the acceptance of appointment by a successor Depository with
respect to each Global Warrant Certificate, (v) issuing definitive Warrant
Certificates in accordance with paragraph (b) of Section 1.03,] (vi) adding to
the covenants of the Company for the benefit of the Holders or surrendering any
right or power conferred upon the Company under this Agreement, or (vii)
amending this Agreement and the Warrants in any manner that the Company may deem
to be necessary or desirable and that will not adversely affect the interests of
the Holders in any material respect.
(b) The Company and the Warrant Agent may amend this Agreement
and the Warrants by executing a Supplemental Agreement with the consent of the
Holders of not fewer than a majority of the unexercised Warrants affected by
such amendment, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Agreement or of modifying in
any manner the rights of the Holders under this Agreement; provided, however,
that, without the consent of each Holder of Warrants affected thereby, no such
amendment may be made that (i) changes the Warrants so as to reduce the
[principal amount] [number] of Warrant Securities purchasable upon exercise of
the Warrants or so as to increase the exercise price [If Warrants for Common
Stock are offered: (other than as provided by Section 2.03)], (ii) shortens the
period of time during which the Warrants may be exercised,
- 18 -
<PAGE>
(iii) otherwise adversely affects the exercise rights of the Holders in any
material respect, or (iv) reduces the number of unexercised Warrants the consent
of the Holders of which is required for amendment of this Agreement or the
Warrants.
SECTION 5.02. Merger, Consolidation, Sale, Transfer or
Conveyance. The Company may consolidate or merge with or into any other
corporation or sell, lease, transfer or convey all or substantially all of its
assets to any other corporation, provided that (i) either (x) the Company is the
continuing corporation or (y) the corporation (if other than the Company) that
is formed by or results from any such consolidation or merger or that receives
such assets is a corporation organized and existing under the laws of the United
States of America or a state thereof and such corporation assumes the
obligations of the Company with respect to the performance and observance of all
of the covenants and conditions of this Agreement to be performed or observed by
the Company and (ii) the Company or such successor corporation, as the case may
be, must not immediately be in default under this Agreement. If at any time
there shall be any consolidation or merger or any sale, lease, transfer,
conveyance or other disposition of all or substantially all of the assets of the
Company, then in any such event the successor or assuming corporation shall
succeed to and be substituted for the Company, with the same effect as if it had
been named herein and in the Warrant Certificates as the Company; the Company
shall thereupon be relieved of any further obligation hereunder or under the
Warrants, and, in the event of any such sale, lease, transfer, conveyance (other
than by way of lease) or other disposition, the Company as the predecessor
corporation may thereupon or at any time thereafter be dissolved, wound up or
liquidated. Such successor or assuming corporation thereupon may cause to be
signed, and may issue either in its own name or in the name of the Company,
Warrant Certificates evidencing the Warrants not theretofore exercised, in
exchange and substitution for the Warrant Certificates theretofore issued. Such
Warrant Certificates shall in all respects have the same legal rank and benefit
under this Agreement as the Warrant Certificates evidencing the Warrants
theretofore issued in accordance with the terms of this Agreement as though such
new Warrant Certificates had been issued at the date of the execution hereof. In
any case of any such merger or consolidation or sale, lease, transfer,
conveyance or other disposition of all or substantially all of the assets of the
Company, such changes in phraseology and form (but not in substance) may be made
in the new Warrant Certificates, as may be appropriate.
- 19 -
<PAGE>
SECTION 5.03. Notices and Demands to the Company and Warrant
Agent. If the Warrant Agent shall receive any notice or demand addressed to the
Company by the Holder [If Warrants are to be issued in Book-Entry form: or a
Participant, as the case may be], the Warrant Agent shall promptly forward such
notice or demand to the Company.
SECTION 5.04. Addresses. Any communications from the Company
to the Warrant Agent with respect to this Agreement shall be addressed to
____________________, Attention: ________________________, and any
communications from the Warrant Agent to the Company with respect to this
Agreement shall be addressed to First Union Corporation, One First Union Center,
Charlotte, North Carolina 28288, Attention: General Counsel (or such other
address as shall be specified in writing by the Warrant Agent or by the Company,
as the case may be). The Company or the Warrant Agent shall give notice to the
Holders of Warrants by mailing written notice by first class mail, postage
prepaid, to such Holders as their names and addresses appear in the books and
records of the Warrant Agent [or, prior to the Detachment Date, on the register
of the Offered Securities].
SECTION 5.05. GOVERNING LAW. THIS AGREEMENT AND
EACH WARRANT CERTIFICATE AND ALL RIGHTS HEREUNDER AND THEREUNDER AND PROVISIONS
HEREOF AND THEREOF SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK (WITHOUT REFERENCE TO APPLICABLE CONFLICTS OF LAW
PROVISIONS).
SECTION 5.06. Delivery of Prospectus. The Company shall
furnish to the Warrant Agent sufficient copies of a prospectus relating to the
Warrant Securities deliverable upon exercise of Warrants and complying in all
material respects with the Securities Act of 1933, as amended (the
"Prospectus"), and the Warrant Agent agrees that upon the exercise of any
Warrant, the Warrant Agent shall deliver a Prospectus to the Holder of such
Warrant, prior to or concurrently with the delivery of the Warrant Securities
issued upon such exercise.
SECTION 5.07. Obtaining of Governmental Approvals. The Company
shall from time to time take all action which may be necessary to obtain and
keep effective any and all permits, consents and approvals of governmental
agencies and authorities and securities acts filings under United States Federal
and state laws, which the Company may deem necessary or appropriate in
connection with the issuance, sale, transfer and delivery of the Warrants, the
- 20 -
<PAGE>
exercise of the Warrants, the issuance, sale, transfer and delivery of the
Warrant Securities to be issued upon exercise of Warrants or upon the expiration
of the period during which the Warrants are exercisable.
SECTION 5.08. Payment of Taxes. The Company will pay all stamp
and other duties, if any, to which, under the laws of the United States of
America, this Agreement or the original issuance of the Warrants may be subject.
SECTION 5.09. Benefits of Warrant Agreement. Nothing in this
Agreement or any Warrant Certificate expressed or implied and nothing that may
be inferred from any of the provisions hereof or thereof is intended, or shall
be construed, to confer upon, or give to, any person or corporation other than
the Company, the Warrant Agent and their respective successors and assigns, [If
Warrants are to be issued in Book-Entry form: the Beneficial Owners] and the
Holders any right, remedy or claim under or by reason of this Agreement or any
Warrant Certificate or of any covenant, condition, stipulation, promise or
agreement hereof or thereof; and all covenants, conditions, stipulations,
promises and agreements contained in this Agreement or any Warrant Certificate
shall be for the sole and exclusive benefit of the Company and the Warrant Agent
and their respective successors and assigns and of the [If Warrants are to be
issued in Book-Entry form: Beneficial Owners and] Holders.
SECTION 5.10. Headings. The descriptive headings of the
several Articles and Sections of this Agreement are inserted for convenience
only and shall not control or affect the meaning or construction of any of the
provisions hereof.
SECTION 5.11. Severability. If any provision in this Agreement
or in any Warrant Certificate shall be invalid, illegal or unenforceable in any
jurisdiction, the validity, legality and enforceability of the remaining
provisions, or of such provisions in any other jurisdiction, shall not in any
way be affected or impaired thereby.
SECTION 5.12. Counterparts. This Agreement may be executed in
any number of counterparts, each of which so executed shall be deemed to be an
original; but such counterparts shall together constitute but one and the same
instrument.
SECTION 5.13. Inspection of Agreement. A copy of this
Agreement shall be available at all reasonable times at the principal corporate
trust office of the Warrant Agent
- 21 -
<PAGE>
and at the office of the Company at One First Union Center, Charlotte, North
Carolina 28288, for inspection by any Holder. The Warrant Agent may require any
such Holder to submit satisfactory proof of ownership for inspection by it.
- 22 -
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above written.
FIRST UNION CORPORATION
By: _________________________
Authorized Officer
[WARRANT AGENT]
By: _________________________
Authorized Officer
- 23 -
<PAGE>
EXHIBIT A
[FORM OF WARRANT CERTIFICATE]
[Form of legend if Securities with Warrants that are not immediately detachable
or Warrants that are not immediately exercisable are offered: [PRIOR TO
_______________,] THIS WARRANT CERTIFICATE [(i) CANNOT BE TRANSFERRED OR
EXCHANGED UNLESS ATTACHED TO A [TITLE OF OFFERED SECURITY] AND (II)] CANNOT BE
EXERCISED IN WHOLE OR IN PART.]
EXERCISABLE ONLY IF COUNTERSIGNED BY THE WARRANT
AGENT AS PROVIDED HEREIN.
Warrant Certificate evidencing
Warrants to Purchase
[Title of Warrant Securities]
as described herein.
FIRST UNION CORPORATION
No. ___________ CUSIP No. _____________
VOID AFTER [5:00 P.M.], NEW YORK TIME, ON _______ __, ___
This certifies that ________________________ or registered
assigns is the registered holder of [Insert number initially issued] warrants to
purchase certain securities (the "Warrants"). Each Warrant entitles the holder
thereof, subject to the provisions contained herein and in the Warrant Agreement
referred to below, to purchase from First Union Corporation, a North Carolina
corporation (the "Company"), [$_________ principal amount] [______] of the
Company's [title of Securities purchasable upon exercise of Warrants] [If
Warrants for Depositary Shares are to be offered: , each representing a 1/__th
interest in a share of [title of securities represented by the Depositary
Shares]] (the "Warrant Securities" [If Warrants for Depositary Shares are to be
offered: , which term shall also refer, as appropriate, to such [title of
securities represented by the Depositary Shares]), [issued or to be issued under
the Indenture (as hereinafter defined)], at the Exercise Price set forth below.
The exercise price of each Warrant (the "Exercise Price") shall be [modify as
appropriate to reflect the terms of the offered Warrants].
A-1
<PAGE>
Subject to the terms of the Warrant Agreement, each Warrant
evidenced hereby may be exercised in whole but not in part at any time, as
specified herein, [Unless Warrants may be exercised on only one date: on any
Business Day (as defined below) occurring during the period (the "Exercise
Period") commencing on [the date of issuance thereof] [________________ __,
____] and ending at 5:00 P.M., New York time,] on ____________ __, ____ (the
"Expiration Date"). Each Warrant remaining unexercised after 5:00 P.M., New York
time, on the Expiration Date shall become void, and all rights of the holder of
this Warrant Certificate evidencing such Warrant shall cease.
The holder of the Warrants represented by this Warrant
Certificate may exercise any Warrant evidenced hereby by delivering, not later
than 5:00 P.M., New York time, on [Unless Warrants may be exercised on only one
date: any Business Day during the Exercise Period (the "Exercise Date")] [If
Warrants may be exercised on only one date: the Expiration Date] to [name of
Warrant Agent] (the "Warrant Agent", which term includes any successor warrant
agent under the Warrant Agreement described below) at its corporate trust
department at ___________________, (i) this Warrant Certificate [For Global
Warrant Certificate: and the Warrants to be exercised (the "Book-Entry
Warrants") free on the records of [The Depository Trust Company] (the
"Depository") to an account of the Warrant Agent at the Depository designated
for such purpose in writing by the Warrant Agent to the Depository], (ii) an
election to purchase ("Election to Purchase"), [For definitive Warrant
Certificates: properly executed by the holder hereof on the reverse of this
Warrant Certificate] [For Global Warrant Certificates: properly executed by the
institution in whose account the Warrant is recorded on the records of the
Depository (the "Participant"), and substantially in the form included on the
reverse of hereof] and (iii) the Exercise Price for each Warrant to be exercised
in lawful money of the United States of America by certified or official bank
check or by bank wire transfer in immediately available funds. If any of (a)
this Warrant Certificate [For Global Warrant Certificates: or the Book-Entry
Warrants], (b) the Election to Purchase, or (c) the Exercise Price therefor, is
received by the Warrant Agent after 5:00 P.M., New York time, on [Unless
Warrants may be exercised on only one date: the specified Exercise Date, the
Warrants will be deemed to be received and exercised on the Business Day next
succeeding the Exercise Date. If the date specified as the Exercise Date is not
a Business Day, the Warrants will be deemed to be received and exercised on the
next succeeding day which is a Business Day. If the Warrants to be exercised are
received or deemed to be received after] the Expiration Date, the exercise
thereof will be null and void and any funds delivered to the Warrant Agent will
be returned to the holder as soon as practicable. In no event will interest
accrue on funds deposited with the Warrant
A-2
<PAGE>
Agent in respect of an exercise or attempted exercise of Warrants. The validity
of any exercise of Warrants will be determined by the Warrant Agent in its sole
discretion and such determination will be final and binding upon the holder of
the Warrants and the Company. Neither the Warrant Agent nor the Company shall
have any obligation to inform a holder of Warrants of the invalidity of any
exercise of Warrants. As used herein, the term "Business Day" means any day
which is not a Saturday or Sunday and is not a legal holiday or a day on which
banking institutions generally are authorized or obligated by law or regulation
to close in __________.
Warrants may be exercised only in whole numbers of Warrants.
[Unless Warrants may be exercised on only one date: If fewer than all of the
Warrants evidenced by this Warrant Certificate are exercised, a new Warrant
Certificate for the number of Warrants remaining unexercised shall be executed
by the Company and countersigned by the Warrant Agent as provided in Section
1.02 of the Warrant Agreement, and delivered to the holder of this Warrant
Certificate at the address specified on the books of the Warrant Agent or as
otherwise specified by such registered holder.]
This Warrant Certificate is issued under and in accordance
with the Warrant Agreement, dated as of ___________ __, ____ (the "Warrant
Agreement"), between the Company and the Warrant Agent and is subject to the
terms and provisions contained in the Warrant Agreement, to all of which terms
and provisions the holder of this Warrant Certificate [For Global Warrant
Certificate: and the beneficial owners of the Warrants represented by this
Warrant Certificate] consent[s] by acceptance hereof. Copies of the Warrant
Agreement are on file and can be inspected at the above-mentioned office of the
Warrant Agent and at the office of the Company at One First Union Center,
Charlotte, North Carolina 28288.
[If the Warrant Securities are Debt Securities: The Warrant
Securities to be issued and delivered upon the exercise of the Warrants
evidenced by this Warrant Certificate will be issued under and in accordance
with the Indenture, dated as of _________ __, ____ (the "Indenture"), between
the Company and [name of trustee], as trustee (together with any successor or
successors as such trustee, the "Trustee"), and will be subject to the terms and
provisions contained in the Warrant Securities and in the Indenture.] The
accrual of [interest] [dividends], if any, on the Warrant Securities issued upon
the valid exercise of any Warrant will be governed by the terms of the
applicable [Indenture] [articles of amendment] and such Warrant Securities. From
and after the issuance of such Warrant
A-3
<PAGE>
Securities, the former holder of the Warrants exercised will be entitled to the
benefits of the [Indenture] [articles of amendment] under which such Warrant
Securities are issued and such former holder's right to receive payments of
[principal of (and premium, if any) and interest, if any, on] [dividends and any
other amounts payable in respect of] the Warrant Securities shall be governed
by, and shall be subject to, the terms and provisions of such [Indenture]
[articles of amendment] and the Warrant Securities. Copies of the [Indenture,
including the form of the Warrant Securities,] [articles of amendment] are on
file at the corporate trust office of the Trustee.]
[If Warrants for Common Stock are offered: The Exercise Price
and the number of Warrant Securities purchasable upon the exercise of each
Warrant shall be subject to adjustment upon (i) the issuance of a stock dividend
to the holders of the outstanding shares of Warrant Securities or a combination,
subdivision or reclassification of the Warrant Securities; (ii) the issuance of
rights, warrants or options to all holders of the Warrant Securities entitling
the holders thereof to purchase Warrant Securities for an aggregate
consideration per share less than the current market price per share of the
Warrant Securities; or (iii) any distribution by the Company to the holders of
the Warrant Securities of evidences of indebtedness of the Company or of assets
(excluding cash dividends or distributions payable out of consolidated earnings
and earned surplus and dividends or distributions referred to in (i) above);
provided that no such adjustment in the number of Warrant Securities purchasable
upon exercise of the Warrants will be required until cumulative adjustments
require an adjustment of at least 1% of such number. No fractional shares will
be issued upon exercise of Warrants, but the Company will pay the cash value of
any fractional shares otherwise issuable. The adjustments to be made under this
Section 2.03 shall be determined by the Warrant Agent and such determination
shall be final and binding upon the holders of the Warrants and the Company.]
[If Securities and Warrants are to be offered together: [If
Warrants are not immediately detachable: Prior to the Detachment Date,] The
Warrants represented by this Warrant Certificate may be exchanged or transferred
only together with the [title of Offered Security] (the "Offered Security") to
which the Warrants are attached, and only for the purpose of effecting, or in
conjunction with, an exchange or transfer of such Offered Security.
Additionally, [If Warrants are not immediately detachable: on or prior to the
Detachment Date,] each transfer of such Offered Security on the register of the
Offered Securities
A-4
<PAGE>
shall operate also to transfer the Warrants to which such Offered Securities was
initially attached. [If Warrants are not immediately detachable: From and after
the Detachment Date, the above provisions shall be of no further force and
effect.]] Upon due presentment for registration of transfer or exchange of this
Warrant Certificate at the corporate trust office of the Warrant Agent, the
Company shall execute, and the Warrant Agent shall countersign and deliver, as
provided in Section 1.02 of the Warrant Agreement, in the name of the designated
transferee one or more new Warrant Certificates of any authorized denomination
evidencing in the aggregate a like number of unexercised Warrants, subject to
the limitations provided in the Warrant Agreement.
Neither this Warrant Certificate nor the Warrants evidenced
hereby shall entitle the holder hereof or thereof to any of the rights of a
holder of the Warrant Securities, including, without limitation, [the right to
receive the payments of principal of (and premium, if any), and interest, if
any, on Debt Securities purchasable upon such exercise or to enforce any of the
covenants in the applicable Indenture] [the right to receive dividends, if any,
or payments upon the liquidation, dissolution or winding up of the Company or to
exercise voting rights, if any].
The Warrant Agreement and this Warrant Certificate may be
amended as provided in the Warrant Agreement including, under certain
circumstances described therein, without the consent of the holder of this
Warrant Certificate or the Warrants evidenced thereby.
THIS WARRANT CERTIFICATE AND ALL RIGHTS HEREUNDER AND UNDER
THE WARRANT AGREEMENT AND PROVISIONS HEREOF AND THEREOF SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (WITHOUT
REFERENCE TO APPLICABLE CONFLICTS OF LAW PROVISIONS).
This Warrant Certificate shall not be entitled to any benefit
under the Warrant Agreement or be valid or obligatory for any purpose, and no
Warrant evidenced hereby may be exercised, unless this Warrant Certificate has
been countersigned by the manual signature of the Warrant Agent.
A-5
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed.
Dated as of ________ __, ____
FIRST UNION CORPORATION
By: ________________________
Authorized Officer
[NAME OF WARRANT AGENT],
as Warrant Agent
By: ________________________
Authorized Officer
A-6
<PAGE>
[REVERSE]
Instructions for Exercise of Warrant
To exercise the Warrants evidenced hereby, the holder [For
Global Warrant Certificate: or Participant] must, by 5:00 P.M., New York time,
on the specified Exercise Date, deliver to the Warrant Agent at its corporate
trust department, a certified or official bank check or a wire transfer in
immediately available funds, in each case payable to the Warrant Agent at
Account No. ____, in an amount equal to the Exercise Price in full for the
Warrants exercised. In addition, the Warrant holder [For Global Warrant
Certificates: or Participant] must provide the information required below and
deliver this Warrant Certificate to the Warrant Agent at the address set forth
below [For Global Warrant Certificates: and the Book-Entry Warrants to the
Warrant Agent in its account with the Depository designated for such purpose].
This Warrant Certificate and the Election to Purchase must be received by the
Warrant Agent by 5:00 P.M., New York time, on the specified Exercise Date.
ELECTION TO PURCHASE
TO BE EXECUTED IF WARRANT HOLDER DESIRES
TO EXERCISE THE WARRANTS EVIDENCED HEREBY
The undersigned hereby irrevocably elects to exercise, on
__________, ____ (the "Exercise Date"), _____________ Warrants, evidenced by
this Warrant Certificate, to purchase, [$_____________ principal amount]
[_________________] of the [title of Securities purchasable upon exercise of
Warrants] [If Warrants for Depositary Shares are to be offered: , each
representing a 1/__th interest in a share of [title of securities represented by
the Depositary Shares]] (the "Warrant Securities") of First Union Corporation, a
North Carolina corporation (the "Company"), and represents that on or before the
Exercise Date such holder has tendered payment for such Warrant Securities by
certified or official bank check or bank wire transfer in immediately available
funds to the order of the Company c/o [Name and address of Warrant Agent], in
the amount of $_____________ in accordance with the terms hereof. The
undersigned requests that said [principal amount of] [number of] Warrant
Securities be in fully registered form, in the authorized denominations,
registered in such names and delivered, all as specified in accordance with the
instructions set forth below.
A-7
<PAGE>
[Unless Warrants may be exercised on only one date: If said
[principal amount] [number] of Warrant Securities is less than all of the
Warrant Securities purchasable hereunder, the undersigned requests that a new
Warrant Certificate evidencing the remaining balance of the Warrants evidenced
hereby be issued and delivered to the holder of the Warrant Certificate unless
otherwise specified in the instructions below.]
Dated: ______________ __, ____
Name__________________________
________________
(Please Print)
/ / / /- / / /- / / / / /
(Insert Social Security or Other Identifying
Number of Holder)
Address_______________________
__________________________
Signature_____________________
This Warrant may only be exercised by presentation to the Warrant Agent at one
of the following locations:
By hand at
By mail at
The method of delivery of this Warrant Certificate is at the option and risk of
the exercising holder and the delivery of this Warrant Certificate will be
deemed to be made only when actually received by the Warrant Agent. If delivery
is by mail, registered mail with return receipt requested, properly insured, is
recommended. In all cases, sufficient time should be allowed to assure timely
delivery.
(Instructions as to form and delivery of Warrant Securities and/or Warrant
Certificates)
A-8
<PAGE>
Name in which Warrant Securities are to be registered if other than in the name
of the registered holder of this Warrant Certificate:
------------------------------
Address to which Warrant Securities are to be mailed if other than to the
address of the registered holder of this Warrant Certificate as shown on the
books of the Warrant Agent:
------------------------------
(Street Address)
------------------------------
(City and State) (Zip Code)
[Except for Global Warrant Certificate:
Name in which Warrant Certificate
evidencing unexercised Warrants, if any,
are to be registered if other than in the
name of the registered holder of this
Warrant Certificate:
-----------------------------
Address to which certificate representing unexercised Warrants, if any, are to
be mailed if other than to the address of the registered holder of this Warrant
Certificate as shown on the books of the Warrant Agent:
------------------------------
(Street Address)
------------------------------
(City and State) (Zip Code)]
Dated:
------------------------------
Signature
([Except for Global Warrant
Certificate: Signature must
A-9
<PAGE>
conform in all respects to
the name of the holder as
specified on the face of this
Warrant Certificate.] If
Warrant Securities, or a
Warrant Certificate
evidencing unexercised
Warrants, are to be issued in
a name other than that of the
registered holder hereof or
are to be delivered to an
address other than the
address of such holder as
shown on the books of the
Warrant Agent, the above
signature must be guaranteed
by a member firm of a
registered national stock
exchange, a member of the
National Association of
Securities Dealers, Inc., a
participant in the Security
Transfer Agents Medallion
Program or the Stock Exchange
Medallion Program, or by a
commercial bank or trust
company having an office or
correspondent in the United
States.)
SIGNATURE GUARANTEE
Name of Firm _________________
Address ______________________
Area Code
and Number ___________________
Authorized
Signature ____________________
Name _________________________
Title ________________________
Dated: ________________, 19__
A-10
<PAGE>
ASSIGNMENT
(FORM OF ASSIGNMENT TO BE EXECUTED IF WARRANT HOLDER
DESIRES TO TRANSFER WARRANTS EVIDENCED HEREBY)
FOR VALUE RECEIVED _________________ hereby sells, assigns and
transfers unto ________________________________
- ---------------------------------- -----------------------
(Please print name and address (Please insert social
including zip code) security or other
identifying number)
the rights represented by the within Warrant Certificate and does hereby
irrevocably constitute and appoint ____________ Attorney, to transfer said
Warrant Certificate on the books of the Warrant Agent with full power of
substitution in the premises.
Dated:
----------------------------------
Signature
(Signature must conform in all
respects to the name of the holder
as specified on the face of this
Warrant Certificate and must bear a
signature guarantee by a member firm
of a registered national securities
exchange, a member of the National
Association of Securities Dealers,
Inc., a participant in the Security
Transfer Agents Medallion Program or
the Stock Exchange Medallion
Program, or by a commercial bank or
trust company having an office or
correspondent in the United States)
SIGNATURE GUARANTEE
Name of Firm _________________
Address ______________________
Area Code
and Number ___________________
Authorized
Signature ____________________
Name _________________________
Title ________________________
A-11
<PAGE>
Dated: ________________, 19__
A-12
Board of Directors August 22, 1997
First Union Corporation
Charlotte, North Carolina 28288
Gentlemen:
I am Executive Vice President, Secretary and General Counsel
of First Union Corporation, a North Carolina corporation (the "Corporation"),
and am rendering this opinion in connection with the Registration Statement on
Form S-3 (the "Registration Statement") being filed by the Corporation with the
Securities and Exchange Commission under the Securities Act of 1933 (the "Act")
with respect to $2,000,000,000 aggregate initial offering price of the
Corporation's (i) common stock, $3.33 1/3 par value per share, including rights
attached thereto to purchase shares of Common stock or junior participating
Class A Preferred Stock pursuant to the Corporation's Shareholder Protection
Rights Agreement (collectively, the "Common Stock"), (ii) preferred stock, no
par value per share ("Preferred Stock"), (iii) Class A Preferred Stock, no par
value per share ("Class A Preferred Stock"), (iv) depositary shares representing
Preferred Stock or Class A Preferred Stock ("Depositary Shares"), (v) debt
securities (the "Debt Securities") and (vi) warrants to purchase Common Stock,
Preferred Stock, Class A Preferred Stock, Debt Securities or Depositary Shares
(the "Warrants"), which may be issued from time to time pursuant to Rule 415
under the Act. The Common Stock, Preferred Stock, Class A Preferred Stock,
Depositary Shares, Debt Securities and Warrants are hereinafter referred to
collectively as the "Securities".
The Debt Securities may be issued pursuant to an Indenture
dated as of April 1, 1983, as amended, between the Corporation and The Chase
Manhattan Bank, as Trustee, and/or an Indenture dated as of March 15, 1986, as
amended, between the Corporation and Harris Trust and Savings Bank, as Trustee.
Depositary Shares will be deposited under a Deposit Agreement
between the Corporation and a bank or trust company as Depositary, and evidenced
by Depositary Receipts.
Warrants will be issued either independently or together with
other Securities and will be issued pursuant to a Warrant Agreement between the
Corporation and a bank or trust company as Warrant Agent.
I have examined such documents, corporate records and other
instruments as I have deemed necessary for the purposes of
-1-
<PAGE>
this opinion. Based upon the foregoing, I am of the opinion as follows:
(1) The Corporation has been duly incorporated and is a
validly existing corporation under the laws of the State of North Carolina.
(2) The Common Stock has been duly authorized and, when the
Registration Statement has become effective under the Act, the terms of the sale
of the Common Stock have been duly established in conformity with the
Corporation's articles of incorporation so as not to violate any applicable law
or result in a default under or breach of any agreement or instrument binding on
the Company and so as to comply with any requirement or restriction imposed by
any court or governmental body having jurisdiction over the Corporation, and the
Common Stock has been duly issued and sold as contemplated by the Registration
Statement, the Common Stock will be validly issued, fully paid and
nonassessable.
(3) The Preferred Stock has been duly authorized and, when the
Registration Statement has become effective under the Act, appropriate articles
of amendment to the Corporation's articles of incorporation relating to the
Preferred Stock have been duly authorized and adopted and filed with the
Secretary of State of the State of North Carolina, the terms of the Preferred
Stock and of their issuance and sale have been duly established in conformity
with the Corporation's articles of incorporation so as not to violate any
applicable law or result in a default under or breach of any agreement or
instrument binding upon the Corporation and so as to comply with any requirement
or restriction imposed by any court or governmental body having jurisdiction
over the Corporation, and the Preferred Stock has been duly issued and sold as
contemplated by the Registration Statement, the Preferred Stock will be validly
issued, fully paid and nonassessable.
(4) The Class A Preferred Stock has been duly authorized and,
when the Registration Statement has become effective under the Act, appropriate
articles of amendment to the Corporation's articles of incorporation relating to
the Class A Preferred Stock have been duly authorized and adopted and filed with
the Secretary of State of the State of North Carolina, the terms of the Class A
Preferred Stock and of their issuance and sale have been duly established in
conformity with the Corporation's articles of incorporation so as not to violate
any applicable law or result in a default under or breach of any
-2-
<PAGE>
agreement or instrument binding upon the Corporation and so as to comply with
any requirement or restriction imposed by any court or governmental body having
jurisdiction over the Corporation, and the Class A Preferred Stock has been duly
issued and sold as contemplated by the Registration Statement, the Class A
Preferred Stock will be validly issued, fully paid and nonassessable.
(5) With respect to Depositary Shares, when the Registration
Statement has become effective under the Act, the Deposit Agreement relating to
the Depositary Shares has been duly authorized, executed and delivered, the
terms of the Depositary Shares and of their issuance have been duly established
in conformity with the Deposit Agreement so as not to violate any applicable law
or result in a default under or breach of any agreement or instrument binding
upon the Corporation and so as to comply with any requirement or restriction
imposed by any court or governmental body having jurisdiction over the
Corporation, the Preferred Stock or Class A Preferred Stock that is represented
by the Depositary Shares has been duly authorized, validly issued and delivered
to the Depositary, the Depositary Receipts evidencing the Depositary Shares have
been executed, countersigned and issued against deposit of the Preferred Stock
or Class A Preferred Stock, as the case may be, in accordance with the Deposit
Agreement and the Depositary Shares have been issued and sold as contemplated by
the Registration Statement, the Depositary Shares will be validly issued and the
Depositary Receipts will entitle the holders thereof to the rights specified in
the Depositary Shares and the Deposit Agreement, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors' rights and to general
equity principles.
(6) With respect to the Debt Securities, when the Registration
Statement has become effective under the Act, the terms of the Debt Securities
and of their issue and sale have been duly established in conformity with the
resolutions of the board of directors of the Corporation and have been duly
established in conformity with the applicable Indenture, as amended, so as not
to violate any applicable law or result in a default under or breach of any
agreement or instrument binding upon the Corporation and so as to comply with
any requirement or restriction imposed by any court or governmental body having
jurisdiction over the Corporation, and the Debt Securities have been duly
executed and authenticated in accordance with such Indenture and issued and sold
as contemplated in the Registration Statement, the Debt Securities will
constitute valid and legally binding obligations of the Corporation, subject to
bankruptcy,
-3-
<PAGE>
insolvency, fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors's rights and to general
equity principles.
(7) With respect to the Warrants, when the Registration
Statement has become effective under the Act, the Warrant Agreement relating to
the Warrants has been duly authorized, executed and delivered, the terms of the
Warrants and of their issuance and sale have been duly established in conformity
with the Warrant Agreement so as not to violate any applicable law or result in
a default under or breach of any agreement or instrument binding upon the
Corporation and so as to comply with any requirement or restriction imposed by
any court or governmental body having jurisdiction over the Corporation, and the
Warrants have been duly executed and countersigned in accordance with the
Warrant Agreement and issued and sold as contemplated by the Registration
Statement, the Warrants will constitute valid and legally binding obligations of
the Corporation, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditors' rights and to general equity principles.
I note that, as of the date of this opinion, a judgment for
money in an action based on a Debt Security denominated in a foreign currency or
currency unit in a federal or state court in the United States ordinarily would
be enforced in the United States only in United States dollars. The date used to
determine the rate of conversion of the foreign currency or currency unit in
which a particular Debt Security is denominated into United States dollars will
depend upon various factors, including which court renders the judgment. In the
case of a Debt Security denominated in a foreign currency, a state court in the
State of New York rendering a judgment on such Debt Security would be required
under Section 27 of the New York Judiciary Law to render such judgment in the
foreign currency in which the Debt Security is denominated, and such judgment
would be converted into United States dollars at the exchange rate prevailing on
the date of entry of the judgment.
I am licensed to practice law only in the State of North
Carolina and in rendering this opinion I am opining only as to the laws of the
United States, the laws of the State of North Carolina and, based solely upon an
opinion, dated the date hereof, of New York counsel, the laws of the State of
New York. In rendering the foregoing opinion, with respect to all matters of New
York law, my opinion is subject to the same assumptions,
-4-
<PAGE>
qualifications and limitations with respect to such matters as are contained in
such opinion of New York counsel.
Also, I have relied as to certain matters on information
obtained from public officials, officers of the Corporation and other sources
believed by me to be responsible, and I have assumed that the related Indentures
have been duly authorized, executed and delivered by the respective Trustee
thereunder, assumptions which I have not independently verified.
I hereby consent to the use of my name under the heading
"Validity of Securities" in the Prospectus forming a part of the Registration
Statement and to the use of this opinion for filing with the Registration
Statement as Exhibit (5) thereto. 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/ Marion A. Cowell, Jr.
-5-
<PAGE>
EXHIBIT (23)(B)
CONSENT OF KPMG PEAT MARWICK LLP
BOARD OF DIRECTORS
FIRST UNION CORPORATION
We consent to the incorporation by reference in this Registration Statement
on Form S-3 of First Union Corporation of our report dated January 16, 1997,
relating to the consolidated balance sheets of First Union Corporation and
subsidiaries as of December 31, 1996 and 1995, and the related consolidated
statements of income, changes in stockholders' equity and cash flows for each of
the years in the three-year period ended December 31, 1996, which report appears
in the 1996 Annual Report to Stockholders which is incorporated by reference in
the 1996 Form 10-K of First Union Corporation. We also consent to the reference
to our firm under the caption "Experts" in this Registration Statement.
KPMG PEAT MARWICK LLP
Charlotte, North Carolina
August 22, 1997
<PAGE>
EXHIBIT (24)
FIRST UNION CORPORATION
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that the undersigned directors and officers
of FIRST UNION CORPORATION (the "Corporation") hereby constitute and appoint
Marion A. Cowell, Jr. and Kent S. Hathaway, and each of them severally, the true
and lawful agents and attorneys-in-fact of the undersigned with full power and
authority in said agents and the attorneys-in-fact, and in any one of them, to
sign for the undersigned and in their respective names as directors and officers
of the Corporation, one or more Registration Statements to be filed with the
Securities and Exchange Commission under the Securities Act of 1933, as amended,
relating to the registration of new debt, equity and other securities of the
Corporation having an aggregate intitial offering price of up to $2,000,000,000,
and to sign any and all amendments to such Registration Statements.
<TABLE>
<CAPTION>
SIGNATURE CAPACITY
<S> <C> <C>
/s/ EDWARD E. CRUTCHFIELD Chairman and Chief Executive Officer and
EDWARD E. CRUTCHFIELD Director
/s/ ROBERT T. ATWOOD Executive Vice President and Chief Financial
ROBERT T. ATWOOD Officer
/s/ JAMES H. HATCH Senior Vice President and Corporate
JAMES H. HATCH Controller (Principal Accounting Officer)
/s/ EDWARD E. BARR Director
EDWARD E. BARR
/s/ G. ALEX BERNHARDT Director
G. ALEX BERNHARDT
/s/ W. WALDO BRADLEY Director
W. WALDO BRADLEY
/s/ ROBERT J. BROWN Director
ROBERT J. BROWN
/s/ A. DANO DAVIS Director
A. DANO DAVIS
/s/ R. STUART DICKSON Director
R. STUART DICKSON
/s/ B.F. DOLAN Director
B.F. DOLAN
</TABLE>
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE CAPACITY
<S> <C> <C>
/s/ RODDEY DOWD, SR. Director
RODDEY DOWD, SR.
/s/ JOHN R. GEORGIUS Director
JOHN R. GEORGIUS
Director
/s/ ARTHUR M. GOLDBERG
/s/ WILLIAM H. GOODWIN, JR. Director
WILLIAM H. GOODWIN, JR.
/s/ HOWARD H. HAWORTH Director
HOWARD H. HAWORTH
/s/ FRANK M. HENRY Director
FRANK M. HENRY
/s/ LEONARD G. HERRING Director
LEONARD G. HERRING
/s/ JUAN RODRIGUEZ INCIARTE Director
JUAN RODRIGUEZ INCIARTE
Director
/s/ JACK A. LAUGHERY
/s/ MAX LENNON Director
MAX LENNON
/s/ RADFORD D. LOVETT Director
RADFORD D. LOVETT
/s/ MACKEY J. MCDONALD Director
MACKEY J. MCDONALD
/s/ JOSEPH NEUBAUER Director
JOSEPH NEUBAUER
/s/ RANDOLPH N. REYNOLDS Director
RANDOLPH N. REYNOLDS
/s/ RUTH G. SHAW Director
RUTH G. SHAW
/s/ CHARLES M. SHELTON, SR. Director
CHARLES M. SHELTON, SR.
</TABLE>
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE CAPACITY
<S> <C> <C>
/s/ LANTY L. SMITH Director
LANTY L. SMITH
/s/ ANTHONY P. TERRACCIANO Director
ANTHONY P. TERRACCIANO
/s/ DEWEY L. TROGDON Director
DEWEY L. TROGDON
Director
/s/ JOHN D. UIBLE
/s/ B.J. WALKER Director
B. J. WALKER
</TABLE>
Dated: August 19, 1997
Charlotte, North Carolina
<PAGE>
-------------------------------------------------------------------
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 CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
NEW YORK 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 PARK AVENUE
NEW YORK, NEW YORK 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
--------------------------------------------
First Union Corporation
(Exact name of obligor as specified in its charter)
NORTH CAROLINA 56-0898180
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
First Union Plaza
Charlotte, North Carolina 28288
(Address of principal executive offices) (Zip Code)
Debt Securities
(Title of the indenture securities)
-----------------------------------------------------
<PAGE>
GENERAL
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.
New York State Banking Department, State House, Albany, New York
12110.
Board of Governors of the Federal Reserve System, Washington,
D.C., 20551
Federal Reserve Bank of New York, District No. 2, 33 Liberty
Street, New York, N.Y.
Federal Deposit Insurance Corporation, Washington, D.C., 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
- 2 -
<PAGE>
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 as now in
effect, including the Organization Certificate and the Certificates of Amendment
dated February 17, 1969, August 31, 1977, December 31, 1980, September 9, 1982,
February 28, 1985, December 2, 1991 and July 10, 1996 (see Exhibit 1 to Form T-1
filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996, in
connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being
contained in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to
Form T-1 filed in connection with Registration Statement No. 333-06249, which is
incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act
(see Exhibit 6 to Form T-1 filed in connection with Registration Statement No.
33-50010, which is incorporated by reference. On July 14, 1996, in connection
with the merger of Chemical Bank and The Chase Manhattan Bank (National
Association), Chemical Bank, the surviving corporation, was renamed The Chase
Manhattan Bank).
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.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, a corporation organized and existing under
the laws of the State of New York, has duly caused this statement of eligibility
to be signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of New York and State of New York, on the 18th day of August, 1997.
THE CHASE MANHATTAN BANK
By /s/ L. O'Brien
/s/ L. O'Brien
Senior Trust Officer
<PAGE>
Exhibit 7 to Form T-1
Bank Call Notice
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business June 30, 1997, in accordance
with a call made by the Federal Reserve Bank of this District
pursuant to the provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
DOLLAR AMOUNTS
ASSETS IN MILLIONS
<S> <C>
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin ........................................................$ 13,892
Interest-bearing balances ................................................ 4,282
Securities: ..................................................................
Held to maturity
securities...................................................................... 2,857
Available for sale securities................................................... 34,091
Federal Funds sold and securities purchased under
agreements to resell ..................................................... 29,970
Loans and lease financing receivables:
Loans and leases, net of unearned income $124,827
Less: Allowance for loan and lease losses 2,753
Less: Allocated transfer risk reserve .................................... 13
----------
Loans and leases, net of unearned income,
allowance, and reserve .................................................... 122,061
Trading Assets ................................................................. 56,042
Premises and fixed assets (including capitalized
leases)......................................................................... 2,904
Other real estate owned ........................................................ 306
Investments in unconsolidated subsidiaries and
associated companies....................................................... 232
Customers' liability to this bank on acceptances
outstanding ............................................................... 2,092
Intangible assets .............................................................. 1,532
Other assets ................................................................... 10,448
---------
TOTAL ASSETS ...................................................................$280,709
=========
- 4 -
<PAGE>
LIABILITIES
Deposits
In domestic offices ....................................................... $91,249
Noninterest-bearing ....................................................... $38,157
Interest-bearing .......................................................... 53,092
---------
In foreign offices, Edge and Agreement subsidiaries,
and IBF's ................................................................. 70,192
Noninterest-bearing ...................................................... $ 3,712
Interest-bearing .......................................................... 66,480
Federal funds purchased and securities sold under agree-
ments to repurchase ............................................................ 35,185
Demand notes issued to the U.S. Treasury ....................................... 1,000
Trading liabilities ............................................................ 42,307
OtherBorrowed money (includes mortgage indebtedness and obligations under
calitalized leases):
With a remaining maturity of one year or less ............................. 4,593
With a remaining maturity of more than one year
through three years................................................. 260
With a remaining maturity of more than three years........................ 146
Bank's liability on acceptances executed and outstanding ....................... 2,092
Subordinated notes and debentures .............................................. 5,715
Other liabilities............................................................... 11,373
TOTAL LIABILITIES .............................................................. 264,112
---------
EQUITY CAPITAL
Perpetual Preferred stock and related surplus 0
Common stock ................................................................... 1,211
Surplus (exclude all surplus related to preferred stock)....................... 10,283
Undivided profits and capital reserves ......................................... 5,280
Net unrealized holding gains (Losses)
on available-for-sale securities ............................................... (193)
Cumulative foreign currency translation adjustments ............................ 16
TOTAL EQUITY CAPITAL ........................................................... 16,597
------
TOTAL LIABILITIES AND EQUITY CAPITAL ...........................................$280,709
==========
</TABLE>
I, Joseph L. Sclafani, E.V.P. & Controller of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us, and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
THOMAS G. LABRECQUE ) DIRECTORS
WILLIAM B. HARRISON, JR.)
-5-
<PAGE>
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) _______________
HARRIS TRUST AND SAVINGS BANK
(Name of Trustee)
Illinois 36-1194448
(I.R.S. Employer
(State of Incorporation) Identification No.)
111 West Monroe Street, Chicago, Illinois 60603
(Address of principal executive offices)
Daniel G. Donovan, Harris Trust and Savings Bank,
111 West Monroe Street, Chicago, Illinois, 60603
312-461-2908
(Name, address and telephone number for agent for service)
FIRST UNION CORPORATION
(Name of Obligor)
North Carolina 56-0892180
(I.R.S. Employer
(State of Incorporation) Identification No.)
One First Union Center
Charlotte, North Carolina 28288-0013
(Address of principal executive offices)
Debt Securities
(Title of indenture securities)
<PAGE>
1. GENERAL INFORMATION. Furnish the following information as to the
Trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
Commissioner of Banks and Trust Companies, State of Illinois,
Springfield, Illinois; Chicago Clearing House Association, 164
West Jackson Boulevard, Chicago, Illinois; 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.
Harris Trust and Savings Bank is authorized to exercise
corporate trust powers.
2. AFFILIATIONS WITH OBLIGOR. If the Obligor is an affiliate of the
Trustee, describe each such affiliation.
The Obligor is not an affiliate of the Trustee.
3. thru 15.
NO RESPONSE NECESSARY
16. LIST OF EXHIBITS.
1. A copy of the articles of association of the Trustee as now in
effect which includes the authority of the trustee to commence
business and to exercise corporate trust powers.
A copy of the Certificate of Merger dated April 1, 1972 between
Harris Trust and Savings Bank, HTS Bank and Harris Bankcorp, Inc.
which constitutes the articles of association of the Trustee as
now in effect and includes the authority of the Trustee to
commence business and to exercise corporate trust powers was filed
in connection with the Registration Statement of Louisville Gas
and Electric Company, File No. 2-44295, and is incorporated herein
by reference.
2. A copy of the existing by-laws of the Trustee.
A copy of the existing by-laws of the Trustee was filed in
connection with the Registration Statement of Commercial Federal
Corporation, File No. 333-20711, and is incorporated herein by
reference.
3. The consents of the Trustee required by Section 321(b) of the Act.
(included as Exhibit A on page 2 of this statement)
4. A copy of the latest report of condition of the Trustee published
pursuant to law or the requirements of its supervising or
examining authority.
(included as Exhibit B on page 3 of this statement)
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the Trustee,
HARRIS TRUST AND SAVINGS BANK, a corporation organized and existing under the
laws of the State of Illinois, 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 State of Illinois, on the 14th day of August, 1997.
HARRIS TRUST AND SAVINGS BANK
By: D. G. DONOVAN
D. G. Donovan
Assistant Vice President
EXHIBIT A
The consents of the Trustee required by Section 321(b) of the Act.
Harris Trust and Savings Bank, as the Trustee herein named, hereby consents that
reports of examinations of said trustee by Federal and State authorities may be
furnished by such authorities to the Securities and Exchange Commission upon
request therefor.
HARRIS TRUST AND SAVINGS BANK
By: D. G. DONOVAN
D.G. Donovan
Assistant Vice President
2
<PAGE>
EXHIBIT B
Attached is a true and correct copy of the statement of condition of Harris
Trust and Savings Bank as of March 31, 1997, as published in accordance with a
call made by the State Banking Authority and by the Federal Reserve Bank of the
Seventh Reserve District.
[LOGO] HARRIS BANK
Harris Trust and Savings Bank
111 West Monroe Street
Chicago, Illinois 60603
of Chicago, Illinois, And Foreign and Domestic Subsidiaries, at the close of
business on March 31, 1997, a state banking institution organized and operating
under the banking laws of this State and a member of the Federal Reserve System.
Published in accordance with a call made by the Commissioner of Banks and Trust
Companies of the State of Illinois and by the Federal Reserve Bank of this
District.
Bank's Transit Number 71000288
<TABLE>
<CAPTION>
THOUSANDS
ASSETS OF DOLLARS
<S> <C>
Cash and balances due from depository institutions:
Non-interest bearing balances and currency and coin ............................ $ 1,594,951
Interest bearing balances ...................................................... $ 620,847
Securities:
a. Held-to-maturity securities .............................................................. $ 0
b. Available-for-sale securities ............................................................ $ 3,674,321
Federal funds sold and securities purchased under agreements to resell in
domestic offices of the bank and of its Edge and Agreement subsidiaries,
and in IBF's:
Federal funds sold ............................................................. $ 447,375
Securities purchased under agreements to resell ................................ $ 0
Loans and lease financing receivables:
Loans and leases, net of unearned income ....................................... $ 8,499,011
LESS: Allowance for loan and lease losses ..................................... $ 110,978
-----------
Loans and leases, net of unearned income, allowance, and reserve
(item 4.a minus 4.b) ........................................................... $ 8,388,033
Assets held in trading accounts .............................................................. $ 126,309
Premises and fixed assets (including capitalized leases) ..................................... $ 188,993
Other real estate owned ...................................................................... $ 446
Investments in unconsolidated subsidiaries and associated companies .......................... $ 53
Customer's liability to this bank on acceptances outstanding ................................. $ 66,859
Intangible assets ............................................................................ $ 292,918
Other assets ................................................................................. $ 495,997
-----------
TOTAL ASSETS ................................................................................. $15,897,102
3
<PAGE>
LIABILITIES
Deposits:
In domestic offices ..................................................................... $ 8,252,773
Non-interest bearing ........................................................... $ 3,414,150
Interest bearing ............................................................... $ 4,838,623
In foreign offices, Edge and Agreement subsidiaries, and IBF's .......................... $ 1,989,792
Non-interest bearing ........................................................... $ 54,391
Interest bearing ............................................................... $ 1,935,401
Federal funds purchased and securities sold under agreements to repurchase in domestic offices
of the bank and of its Edge and Agreement subsidiaries, and in IBF's:
Federal funds purchased.& securites sold under agreements to repurchase ................. $ 2,896,616
Trading Liabilities .......................................................................... 81,381
Other borrowed money: ........................................................................ $ 991,442
a. With remaining maturity of one year or less .............................................. $ 0
b. With remaining maturity of more than one year
Bank's liability on acceptances executed and outstanding ..................................... $ 66,859
Subordinated notes and debentures ............................................................ $ 310,000
Other liabilities ............................................................................ $ 138,427
============
TOTAL LIABILITIES ............................................................................ $ 14,727,290
============
EQUITY CAPITAL
Common ....................................................................................... $ 100,000
stock
Surplus ...................................................................................... $ 600,566
a. Undivided profits and capital reserves ................................................... $ 519,518
b. Net unrealized holding gains (losses) on available-for-sale securities ................... ($ 50,272)
------------
TOTAL EQUITY CAPITAL ......................................................................... $ 1,169,812
============
Total liabilities, limited-life preferred stock, and equity capital .......................... $ 15,897,102
============
</TABLE>
I, Steve Neudecker, Vice President of the above-named bank, do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the Board of Governors of the Federal Reserve System and
is true to the best of my knowledge and belief.
STEVE NEUDECKER
4/30/97
We, the undersigned directors, attest to the correctness of this Report
of Condition and declare that it has been examined by us and, to the best of our
knowledge and belief, has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and the
Commissioner of Banks and Trust Companies of the State of Illinois and is true
and correct.
EDWARD W. LYMAN,
ALAN G. McNALLY,
MARIBETH S. RAHE Directors.
4
