<PAGE>
RULE NO. 424(b)(5)
REGISTRATION NO. 33-57882
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED FEBRUARY 12, 1993
$100,000,000
GOLDEN WEST FINANCIAL CORPORATION
6.70% SUBORDINATED NOTES DUE JULY 1, 2002
----------------
Interest on the 6.70% Subordinated Notes due July 1, 2002 (the "Notes") is
payable semi-annually on January 1 and July 1 of each year (the "Interest
Payment Dates"), commencing January 1, 1996. The regular record dates (the
"Record Dates") for the payment of interest on the Notes will be December 15
and June 15 of each year. Interest will accrue from June 27, 1995 (the
"Interest Accrual Date"). The Notes will mature on July 1, 2002. The Notes may
not be redeemed prior to maturity. See "Description of the Notes."
The Notes will be unsecured and subordinated to Senior Indebtedness of
Golden West Financial Corporation (the "Company") as described herein. See
"Description of Subordinated Debt Securities--Subordination" in the
Prospectus. Payment of principal of the Notes may be accelerated only in the
case of the bankruptcy, insolvency or reorganization of the Company. There is
no right of acceleration upon a default in the payment of interest on the
Notes or in the performance of any covenant of the Company. See "Description
of Subordinated Debt Securities--Certain Modifications to the Indenture" and
"--Defaults and Certain Rights on Default" in the accompanying Prospectus. The
Notes are not obligations of a savings and loan association and are not
insured by the Federal Deposit Insurance Corporation.
The Notes will be represented by one or more global notes (collectively, the
"Global Note") registered in the name of a nominee of The Depository Trust
Company, as Depositary. Beneficial interests in the Global Note will be shown
on, and transfers thereof will be effected only through, records maintained by
the Depositary and its participants. Except as described in "Description of
the Notes--Book-Entry System," owners of beneficial interests in the Global
Note will not be entitled to receive Notes in definitive form and will not be
considered the owners or Holders thereof. Settlement for the Notes will be
made in immediately available funds. So long as the Global Note is registered
in the name of the Depositary or its nominee, the Global Note will trade in
the Depositary's Same-Day Funds Settlement System and secondary market trading
activity in the Notes will therefore settle in immediately available funds.
See "Description of the Notes--Same-Day Settlement and Payment."
----------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT
OR THE PROSPECTUS TO WHICH IT RELATES. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
----------------
<TABLE>
<CAPTION>
INITIAL PUBLIC UNDERWRITING PROCEEDS TO
OFFERING PRICE(1) DISCOUNT(2) COMPANY(1)(3)
----------------- ------------ -------------
<S> <C> <C> <C>
Per Note........................... 99.883% .600% 99.283%
Total.............................. $99,883,000 $600,000 $99,283,000
</TABLE>
- --------
(1) Plus accrued interest, if any, from June 27, 1995 to date of delivery.
(2) The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933. See
"Underwriting."
(3) Before deducting expenses payable by the Company estimated at $75,000.
----------------
The Notes offered by this Prospectus Supplement are offered severally by the
Underwriters subject to prior sale, withdrawal, cancellation or modification
of the offer without notice, to delivery to and acceptance by the Underwriters
and to certain further conditions. It is expected that delivery of the Notes
will be made through the facilities of The Depository Trust Company on or
about June 27, 1995.
GOLDMAN, SACHS & CO.
----------------
The date of this Prospectus Supplement is June 22, 1995.
<PAGE>
CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES
The following table sets forth the consolidated ratios of earnings to fixed
charges for Golden West Financial Corporation (the "Company" or "Golden West")
for the periods indicated. Earnings represent income from continuing operations
before income taxes, fixed charges and extraordinary items. Fixed charges
include interest expense and amortization of debt expense. Such information is
qualified in its entirety by the more detailed financial information set forth
in the financial statements and notes thereto appearing in the documents
incorporated herein by reference. See "Information Incorporated by Reference"
in the Prospectus.
<TABLE>
<CAPTION>
THREE MONTHS
YEAR ENDED DECEMBER 31, ENDED MARCH 31,
--------------------------------------- ---------------
1994 1993 1992 1991 1990 1995 1994
------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of earnings to
fixed charges:
Including interest on
customer deposits..... 1.34x 1.40x 1.36x 1.24x 1.18x 1.22x 1.42x
Excluding interest on
customer deposits..... 1.87x 2.05x 2.08x 1.78x 1.48x 1.55x 2.12x
</TABLE>
APPLICATION OF PROCEEDS
It is intended that the net proceeds from the sale of the Notes will be used
for general corporate purposes. The net proceeds may be contributed to the
Company's subsidiary associations in the form of equity or subordinated debt
and may be used in connection with acquisitions directly by the Company or by a
subsidiary association. Pending a determination of the use of the net proceeds,
such proceeds will be invested in short-term obligations.
DESCRIPTION OF THE NOTES
The following description of the particular terms of the Notes offered hereby
supplements the description of the general terms and provisions of Subordinated
Debt Securities set forth in the Prospectus, to which description reference is
hereby made.
The Notes will be issued under an indenture dated as of July 1, 1992, between
the Company and BankAmerica National Trust Company, as trustee (the "Trustee"),
as supplemented by the First Supplemental Indenture dated as of January 5, 1993
(the "Indenture"), will be limited to $100,000,000 aggregate principal amount
and will mature on the date set forth on the cover of this Prospectus
Supplement. The Notes will bear interest at the per annum rate set forth on the
cover of this Prospectus Supplement from the Interest Accrual Date or from the
most recent Interest Payment Date to which interest has been paid or provided
for, payable semi-annually on the Interest Payment Dates to the persons in
whose names the Notes are registered at the close of business on the Record
Date next preceding each such Interest Payment Date. Interest will be
calculated on the basis of a 360-day year of twelve 30-day months.
The Notes are to be issued as Registered Securities without coupons in
denominations of $100,000 or any amount in excess thereof which is an integral
multiple of $1,000. Principal of and interest on the Notes will be payable at
the offices of the Paying Agent of the Company maintained for such purposes in
the Borough of Manhattan, The City of New York; provided that payment of
interest may be made at the option of the Company by check mailed to the
persons in whose names the Notes are registered at the close of business on the
Record Date next preceding any Interest Payment Date; provided, further, that
so long as the Notes are registered in the name of the Depositary or its
nominee, beneficial owners of Notes will not be entitled to receive
certificates evidencing the Notes and the principal of and interest on the
Notes will be payable as described below under "Book-Entry System" and "Same-
Day Settlement and Payment."
The Notes will not be redeemable by the Company or repayable at the option of
the Holders prior to maturity. No sinking fund will be provided for the Notes.
S-2
<PAGE>
The Notes will be unsecured and will be subordinate and junior to all Senior
Indebtedness of the Company. See "Description of Subordinated Debt Securities--
Subordination" in the Prospectus. Payment of principal of the Notes may be
accelerated only in the case of the bankruptcy, insolvency or reorganization of
the Company. There is no right of acceleration upon a default in the payment of
interest on the Notes or in the performance of any covenant of the Company. See
"Description of Subordinated Debt Securities--Certain Modifications to the
Indenture" and "--Defaults and Certain Rights on Default" in the accompanying
Prospectus. As of June 1, 1995, the Company, on an unconsolidated basis, had no
Senior Indebtedness outstanding and had outstanding $1,030,000,000 aggregate
principal amount of Subordinated Indebtedness, including $730,000,000 of Prior
Subordinated Indebtedness. The Indenture does not limit the amount of Senior
Indebtedness of the Company and the Company may incur Senior Indebtedness from
time to time.
The Notes will be subject to defeasance as described under "Description of
Subordinated Debt Securities--Defeasance" in the Prospectus.
BOOK-ENTRY SYSTEM
The Notes will be issued in the form of one or more fully registered global
securities (collectively, the "Global Note") which will be deposited with, or
on behalf of, The Depository Trust Company, New York, New York (the
"Depositary") and registered in the name of the Depositary's nominee. Except as
set forth below, the Global Note may be transferred, in whole and not in part,
only by the Depositary to a nominee of the Depositary or by a nominee of such
Depositary to such Depositary or another nominee of such Depositary or by the
Depositary or any nominee to a successor depositary or any nominee of such
successor.
The Depositary has advised the Company and the Underwriters as follows: The
Depositary is a limited-purpose trust company organized under the New York
Banking Law, a "banking organization" within the meaning of the New York
Banking Law, a member of the Federal Reserve System, a "clearing corporation"
within the meaning of the New York Uniform Commercial Code, and a "clearing
agency" registered pursuant to the provisions of Section 17A of the Securities
Exchange Act of 1934. The Depositary holds securities that its participants
("Participants") deposit with the Depositary. The Depositary also facilitates
the settlement among Participants of securities transactions, such as transfers
and pledges, in deposited securities through electronic computerized book-entry
changes in Participants' accounts, thereby eliminating the need for physical
movement of securities certificates. Direct Participants include securities
brokers and dealers, banks, trust companies, clearing corporations, and certain
other organizations. The Depositary is owned by a number of its Direct
Participants and by the New York Stock Exchange, Inc., the American Stock
Exchange, Inc., and the National Association of Securities Dealers, Inc. Access
to the Depositary's system is also available to others such as securities
brokers and dealers, banks, and trust companies that clear through or maintain
a custodial relationship with a Direct Participant, either directly or
indirectly ("Indirect Participants"). The Rules applicable to the Depositary
and its Participants are on file with the Securities and Exchange Commission.
Purchases of Notes under the Depositary's system must be made by or through
Direct Participants, which will receive a credit for the Notes on the
Depositary's records. The ownership interest of each actual purchaser of each
Note ("Beneficial Owner") is in turn to be recorded on the Direct and Indirect
Participants' records. Beneficial Owners will not receive written confirmation
from the Depositary of their purchase, but Beneficial Owners are expected to
receive written confirmations providing details of the transactions, as well as
periodic statements of their holdings, from the Direct or Indirect Participant
through which the Beneficial Owner entered into the transaction. Transfers of
ownership interests in the Notes are to be accomplished by entries made
S-3
<PAGE>
on the books of Participants acting on behalf of Beneficial Owners. Beneficial
Owners will not receive certificates representing their ownership interest in
Notes, except in the event that use of the book-entry system for the Notes is
discontinued.
To facilitate subsequent transfers, all Notes deposited by Participants with
the Depositary are registered in the name of the Depositary's partnership
nominee, Cede & Co. The deposit of Notes with the Depositary and their
registration in the name of Cede & Co. effect no change in beneficial
ownership. The Depositary has no knowledge of the actual Beneficial Owners of
the Notes; the Depositary's records reflect only the identity of the Direct
Participants to whose accounts such Notes are credited, which may or may not be
the Beneficial Owners. The Participants will remain responsible for keeping
account of their holdings on behalf of their customers.
Conveyance of notices and other communications by the Depositary to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct
Participants and Indirect Participants to Beneficial Owners will be governed by
arrangements among them, subject to any statutory or regulatory requirements as
may be in effect from time to time.
Neither the Depositary nor Cede & Co. will consent or vote with respect to
Notes. Under its usual procedures, the Depositary mails an Omnibus Proxy to the
Company as soon as possible after the record date. The Omnibus Proxy assigns
Cede & Co.'s consenting or voting rights to those Direct Participants to whose
accounts the Notes are credited on the record date (identified in a listing
attached to the Omnibus Proxy).
Principal and interest payments on the Notes will be made to the Depositary.
The Depositary's practice is to credit Direct Participants' accounts on payable
date in accordance with their respective holdings shown on the Depositary's
records unless the Depositary has reason to believe that it will not receive
payment on payable date. Payments by Participants to Beneficial Owners will be
governed by standing instructions and customary practices, as is the case with
securities held for the accounts of customers in bearer form or registered in
"street name," and will be the responsibility of such Participant and not of
the Depositary, the Trustee, or the Company, subject to any statutory or
regulatory requirements as may be in effect from time to time. Payment of
principal and interest to the Depositary is the responsibility of the Company
or the Trustee, disbursement of such payments to Direct Participants shall be
the responsibility of the Depositary, and disbursement of such payments to the
Beneficial Owners shall be the responsibility of Direct and Indirect
Participants.
The Depositary may discontinue providing its services as securities
depositary with respect to the Notes at any given time by giving reasonable
notice to the Company or the Trustee. Under such circumstances, in the event
that a successor securities depositary is not obtained, Note certificates are
required to be printed and delivered.
The Company may decide to discontinue use of the system of book-entry
transfers through the Depositary (or a successor securities depositary). In
that event, Note certificates will be printed and delivered.
The Global Note representing all but not part of the Notes will be exchanged
for Notes in definitive form of like tenor and terms if (i) the Depositary
notifies the Company that it is unwilling or unable to continue as depositary
for such Global Note or if at any time the Depositary ceases to be a clearing
agency registered under the Securities Exchange Act of 1934 and, in either
case, a successor depositary is not appointed by the Company within 90 days of
receipt by the Company of such notice or of the Company becoming aware of such
ineligibility, (ii) the Company in its discretion at any time determines not to
have all of the Notes represented by the Global Note and notifies the Trustee
thereof, or (iii) an Event of Default has occurred and is continuing with
respect to the Notes.
S-4
<PAGE>
The Global Note exchangeable pursuant to the preceding sentence shall be
exchangeable for Notes issuable in authorized denominations and registered in
such names as the Depositary shall direct. It is expected that such
instructions will be based on directions received by the Depositary from its
Direct Participants with respect to ownership of beneficial interests in the
Global Note. Subject to the foregoing, a Global Note is not exchangeable,
except for a Note or Notes of the same aggregate denominations to be registered
in the name of the Depositary or its nominee or in the name of a successor of
the Depositary or a nominee of such successor.
The information in this section concerning the Depositary and the
Depositary's book-entry system has been obtained from sources that the Company
believes to be reliable, but the Company takes no responsibility for the
accuracy thereof.
SAME-DAY SETTLEMENT AND PAYMENT
Settlement for the Notes will be made by the Underwriters in immediately
available or same-day funds. So long as the Notes are represented by the Global
Note, all payments of principal and interest will be made by the Company in
immediately available funds.
Secondary trading in the notes and debentures of corporate issuers is
generally settled in clearinghouse or next-day funds. In contrast, so long as
the Notes are represented by the Global Note registered in the name of the
Depositary or its nominee, the Notes will trade in the Depositary's Same-Day
Funds Settlement System, and secondary market trading activity in the Notes
represented by the Global Note will therefore be required by the Depositary to
settle in immediately available or same-day funds. No assurance can be given as
to the effect, if any, of settlement in same-day funds on trading activity in
the Notes.
UNDERWRITING
Subject to the terms and conditions contained in the Underwriting Agreement,
the Company has agreed to sell to Goldman, Sachs & Co. (the "Underwriters"),
and the Underwriters have agreed to purchase, $100,000,000 principal amount of
the Notes.
The Underwriters have advised the Company that they propose initially to
offer the Notes to the public at the public offering price set forth on the
cover page of this Prospectus Supplement, and to certain dealers at such price
less a concession not in excess of 0.30% of the principal amount. The
Underwriters may allow and such dealers may reallow a discount not in excess of
0.25% of the principal amount of the Notes to certain other dealers. After the
initial public offering, the public offering price, concession and discount may
be changed.
The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933.
The Notes are a new issue of securities with no established trading market
and will not be listed on any securities exchange. The Company has been advised
by the Underwriters that they intend to make a market in the Notes, but the
Underwriters are under no obligation to do so and may discontinue any market
making at any time without notice. No assurance can be given as to the
liquidity of the trading market for the Notes. See "Description of the Notes--
Same-Day Settlement and Payment."
VALIDITY
The validity of the Notes is being passed upon for the Company by Orrick,
Herrington & Sutcliffe, San Francisco, California. Brown & Wood, San Francisco,
California will act as counsel for the Underwriters.
S-5
<PAGE>
[THIS PAGE INTENTIONALLY LEFT BLANK]
<PAGE>
PROSPECTUS
$300,000,000
GOLDEN WEST FINANCIAL CORPORATION
SUBORDINATED DEBT SECURITIES
Golden West Financial Corporation (the "Company") from time to time may offer
its debt securities consisting of subordinated debentures, notes, bonds and/or
other evidences of subordinated indebtedness (the "Subordinated Debt
Securities"), with an aggregate initial public offering price of up to U.S.
$300,000,000 or the equivalent thereof in one or more foreign currencies or
composite currencies, including European Currency Units. The Subordinated Debt
Securities may be offered in separate series in amounts, at prices and on terms
to be set forth in supplements to this Prospectus. The Subordinated Debt
Securities may be sold for U.S. dollars, one or more foreign currencies or
amounts determined by reference to an index, and the principal of and any
interest on the Subordinated Debt Securities may likewise be payable in U.S.
dollars, one or more foreign currencies or amounts determined by reference to
an index.
The Subordinated Debt Securities will be subordinated to all existing and
future Senior Indebtedness (as defined) of the Company. See "Description of
Subordinated Debt Securities--Subordination."
The terms of the Subordinated Debt Securities, including, where applicable,
the specific designation, aggregate principal amount, initial public offering
price, currency, denomination, maturity, premium, rate (which may be fixed or
variable) and time of payment of interest and terms for redemption at the
option of the Company, for repayment at the option of the holder, for sinking
fund payments, for payments of additional amounts or requiring the Subordinated
Debt Securities to be payable at maturity only by exchange for, or from
designated proceeds from the sale of, common stock, perpetual preferred stock
or certain other securities, will be set forth in a supplement to this
Prospectus (the "Prospectus Supplement"). Payment of principal of the
Subordinated Debt Securities offered hereby may be accelerated only in the case
of the bankruptcy, insolvency or reorganization of the Company. There is no
right of acceleration upon a default in the payment of interest on the
Subordinated Debt Securities offered hereby or in the performance of any
covenant of the Company. See "Description of Subordinated Debt Securities--
Certain Modifications to the Indenture" and "--Defaults and Certain Rights on
Default."
The Subordinated Debt Securities may be sold through underwriting syndicates
led by one or more managing underwriters or through one or more underwriters
acting alone. The Subordinated Debt Securities may also be sold directly by the
Company or through agents designated from time to time. If any underwriters or
agents are involved in the sale of the Subordinated Debt Securities, their
names, the principal amount of Subordinated Debt Securities to be purchased by
them and any applicable fee, commission or discount arrangements with them will
be set forth in the Prospectus Supplement. See "Plan of Distribution."
The Subordinated Debt Securities may be issued in registered form or bearer
form with coupons attached or both. In addition, all or a portion of the
Subordinated Debt Securities of a series may be issuable in temporary or
permanent global form. Subordinated Debt Securities in bearer form will be
offered only to non-United States persons and to offices located outside the
United States of certain United States financial institutions.
This Prospectus may not be used to consummate sales of Subordinated Debt
Securities unless accompanied by a Prospectus Supplement.
----------------
THESE SECURITIES ARE THE SOLE OBLIGATION OF GOLDEN WEST FINANCIAL
CORPORATION, AND ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION
OR ANY OTHER GOVERNMENT AGENCY.
----------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
----------------
THE DATE OF THIS PROSPECTUS IS FEBRUARY 12, 1993.
<PAGE>
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SUBORDINATED
DEBT SECURITIES OR CAPITAL SECURITIES AT A LEVEL ABOVE THAT WHICH MIGHT
OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH TRANSACTIONS MAY BE EFFECTED IN THE
OVER-THE-COUNTER MARKET AND, IN THE CASE OF CERTAIN CAPITAL SECURITIES, THE NEW
YORK, MIDWEST AND PACIFIC STOCK EXCHANGES. SUCH STABILIZING, IF COMMENCED, MAY
BE DISCONTINUED AT ANY TIME.
----------------
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934 and in accordance therewith files proxy statements,
reports and other information with the Securities and Exchange Commission (the
"Commission"). This filed material can be inspected and copied at Regional
Offices of the Commission located at 500 West Madison Street, Suite 1400,
Chicago, Illinois and 7 World Trade Center, 13th Floor, New York, New York; and
at the Public Reference Office of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. Copies of such material can be obtained from the Public
Reference Section of the Commission, 450 Fifth Street, N.W., Washington, D.C.
20549 at prescribed rates. In addition, certain securities of the Company are
listed on the New York, Midwest and Pacific Stock Exchanges, and such material
can also be inspected at the offices of such exchanges.
INFORMATION INCORPORATED BY REFERENCE
The following documents filed by the Company with the Commission are
incorporated by reference in this Prospectus.
1. The Company's Annual Report on Form 10-K for the year ended December 31,
1991.
2. The Company's Quarterly Reports on Form 10-Q for the quarters ended March
31, 1992 (as amended by a Form 8 dated May 15, 1992), June 30, 1992 and
September 30, 1992.
3. The Company's Current Report on Form 8-K dated January 5, 1993.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Securities Exchange Act of 1934 after the date of this Prospectus
and prior to the termination of the offering of the Subordinated Debt
Securities offered hereby shall be deemed to be incorporated by reference in
this Prospectus. Any statement contained in a document incorporated by
reference herein shall be deemed to be modified or superseded for purposes
hereof to the extent that a statement contained herein (or in any other
subsequently filed document which also is incorporated by reference herein)
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed to constitute a part hereof, except as so
modified or superseded.
The Company will furnish without charge to each person, including any
beneficial owner, to whom this Prospectus is delivered, on the written or oral
request of such person, a copy of any or all of the documents incorporated by
reference, other than exhibits to such documents. Requests should be directed
to J.L. Helvey, Golden West Financial Corporation, 1901 Harrison Street,
Oakland, California 94612 (telephone: 510-446-3420).
Unless otherwise indicated, currency amounts in this Prospectus and any
Prospectus Supplement are stated in United States dollars ("$", "dollars",
"U.S. dollars" or "U.S. $").
2
<PAGE>
GOLDEN WEST FINANCIAL CORPORATION
Golden West Financial Corporation, a Delaware corporation, is a savings and
loan holding company, the principal business of which is the operation of a
savings and loan business through its wholly-owned subsidiary, World Savings
and Loan Association, a Federal Savings and Loan Association (the
"Association"). The Association is a federally chartered, capital stock savings
and loan association, incorporated in 1912, the deposits of which are insured
by the SAIF-fund of the Federal Deposit Insurance Corporation. At September 30,
1992, the Company, through the Association, operated 112 savings branches in
California, 63 in Colorado, 17 in Florida, ten in Kansas, eight in New Jersey,
seven in Texas, seven in Ohio and three in Arizona. As used herein, the term
"Company" means Golden West Financial Corporation and its consolidated
subsidiaries, unless the context requires otherwise.
The Company's principal business, conducted through the Association, consists
of attracting funds, primarily in the form of savings deposits from the general
public, and investing those funds in loans and securities secured by liens on
residential and other real estate. At September 30, 1992, the Company had total
assets of $25.8 billion and its deposits totalled $16.3 billion. The Company's
operating results depend primarily upon the difference between (i) its revenues
from loans and investments and (ii) expenses incurred in obtaining investment
funds (including interest paid on deposit accounts and on Federal Home Loan
Bank advances and other borrowings) and general operating expenses. As a
financial intermediary, the Company seeks to control its exposure to general
interest rate changes by matching, to the extent feasible, the maturities of
its sources of funds with the maturities of its investments and by increasing
the interest rate sensitivity of its loan portfolio. The Company also seeks to
control general and administrative expenses through a program of strict cost
control and to limit loan loss exposure by concentrating its lending activities
in residential properties and emphasizing traditional appraisal and loan
underwriting practices. At September 30, 1992, 79% of the Company's loan
portfolio consisted of adjustable rate mortgages ("ARMs"), 13% consisted of
fixed-rate mortgages and 8% was held in the form of Government National
Mortgage Association, Federal Home Loan Mortgage Corporation and Federal
National Mortgage Association mortgage-backed securities.
The Company is a savings and loan holding company and, together with its
subsidiaries, is subject to extensive examination, supervision and regulation
by the Office of Thrift Supervision ("OTS") and the Federal Deposit Insurance
Corporation. Applicable regulations govern, among other things, the Company's
lending and investment powers, the types of accounts it is permitted to offer,
the types of business in which it may engage, and requirements for regulatory
capital. The Company is also subject to regulations of the Board of Governors
of the Federal Reserve System with respect to required reserves and certain
other matters.
The Company is a legal entity separate and distinct from the Association and
its other subsidiaries. The principal source of the Company's cash flow on an
unconsolidated basis has been dividends from the Association. Various statutory
and regulatory restrictions and tax considerations, however, limit directly or
indirectly the amount of dividends the Association can pay. See the Company's
Annual Report on Form 10-K for the year ended December 31, 1991 which is
incorporated herein by reference. Various statutory and regulatory restrictions
also restrict the Association from making investments in, or loans to, the
Company.
In addition, because the Company is a holding company, the rights of its
creditors, including holders of the Subordinated Debt Securities, to
participate in the assets of any subsidiary upon the latter's liquidation or
reorganization will be subject to the claims of the subsidiary's creditors,
which will take priority except to the extent that the Company itself may be a
creditor with recognized claims against the subsidiary.
3
<PAGE>
In December 1991, the Federal Deposit Insurance Corporation Improvement Act
of 1991 ("FDICIA") was enacted. Among other things, FDICIA requires a savings
association which does not meet any one of its capital requirements to submit a
capital restoration plan for improving its capital to the OTS. The holding
company of a savings association must guarantee that the savings association
will meet its capital restoration plan, subject to certain limitations. If such
a guarantee were deemed to be a commitment to maintain capital under the
federal Bankruptcy Code, a claim under such guarantee in a bankruptcy
proceeding involving the holding company would be entitled to a priority over
third party creditors of the holding company.
As set forth below under "Description of Subordinated Debt Securities--
Subordination," the Subordinated Debt Securities are subordinated to all Senior
Indebtedness.
The principal executive offices of the Company are located at 1901 Harrison
Street, Oakland, California 94612, and the telephone number is (510) 446-3420.
APPLICATION OF PROCEEDS
It is intended that the net proceeds from the sale of the Subordinated Debt
Securities will be used for general corporate purposes. The net proceeds may be
contributed to the Company's subsidiary association in the form of equity or
subordinated debt and may be used in connection with acquisitions directly by
the Company or by the subsidiary association. The Company is reviewing various
acquisition opportunities, including transactions with the Resolution Trust
Corporation and the Federal Deposit Insurance Corporation. Pending a
determination of the use of the net proceeds, such proceeds will be invested in
short-term obligations.
CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES
The following table sets forth the consolidated ratios of earnings to fixed
charges for the periods indicated. Earnings represent income from continuing
operations before income taxes, fixed charges and extraordinary items. Fixed
charges include interest expense and amortization of debt expense.
<TABLE>
<CAPTION>
NINE MONTHS
ENDED
YEAR ENDED DECEMBER 31, SEPTEMBER 30,
------------------------ -------------
1991 1990 1989 1988 1987 1992 1991
---- ---- ---- ---- ---- ------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of earnings to fixed charges:
Including interest on deposits........ 1.24 1.18 1.17 1.21 1.30 1.36 1.24
Excluding interest on deposits........ 1.78 1.48 1.41 1.67 1.91 2.08 1.75
</TABLE>
DESCRIPTION OF SUBORDINATED DEBT SECURITIES
The following description of the terms of the Subordinated Debt Securities
sets forth certain general terms and provisions of the Subordinated Debt
Securities to which any Prospectus Supplement may relate. The particular terms
of the Subordinated Debt Securities offered by any Prospectus Supplement and
the extent, if any, to which such general provisions may apply to the
Subordinated Debt Securities so offered will be described in the Prospectus
Supplement relating to such Subordinated Debt Securities.
The Subordinated Debt Securities are to be issued under an Indenture dated as
of July 1, 1992 between the Company and BankAmerica National Trust Company, as
Trustee (the "Trustee"), as supplemented by the First Supplemental Indenture
dated as of January 5, 1993 (the "Indenture").
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See "Certain Modifications to the Indenture." The Indenture is an exhibit to
the registration statement of which this Prospectus is a part (the
"Registration Statement"). The following summaries of certain provisions of the
Indenture do not purport to be complete and are qualified in their entirety by
reference to the provisions of the Indenture. Numerical references in
parentheses below are to sections of the Indenture and, unless otherwise
indicated, capitalized terms shall have the meanings ascribed to them in the
Indenture.
GENERAL
The Subordinated Debt Securities will be subordinated in right of payment to
the prior payment in full of the Senior Indebtedness of the Company as
described under "Subordination." The Indenture provides that Subordinated Debt
Securities in an unlimited amount may be issued thereunder from time to time in
one or more series. (Section 301)
The applicable Prospectus Supplement will describe the following terms of the
series of Subordinated Debt Securities offered thereby: (1) the title of the
Subordinated Debt Securities; (2) any limit on the aggregate principal amount
of the Subordinated Debt Securities; (3) whether the Subordinated Debt
Securities are to be issuable as Registered Securities or Bearer Securities or
both, whether any of the Subordinated Debt Securities are to be issuable
initially in temporary global form and whether any of the Subordinated Debt
Securities are to be issuable in permanent global form; (4) the price or prices
(expressed as a percentage of the aggregate principal amount thereof) at which
the Subordinated Debt Securities will be issued; (5) the date or dates on which
the Subordinated Debt Securities will mature; (6) the rate or rates at which
the Subordinated Debt Securities will bear interest, if any, or the formula
pursuant to which such rate or rates shall be determined, and the date or dates
from which any such interest will accrue; (7) the Interest Payment Dates on
which any such interest on the Subordinated Debt Securities will be payable,
the Regular Record Date for any interest payable on any Subordinated Debt
Securities which are Registered Securities on any Interest Payment Date, and
the extent to which, or the manner in which, any interest payable on a
temporary global Security on an Interest Payment Date will be paid if other
than in the manner described under "Temporary Global Securities" below; (8) any
terms by which the principal of the Subordinated Debt Securities will be
exchangeable for Capital Securities (see "Description of Capital Securities")
and any covenant pursuant to which the proceeds of sales of Capital Securities
shall be designated on the books of the Company as available for the payment of
any of the principal of the Subordinated Debt Securities (the "Available
Funds"); (9) any mandatory or optional sinking fund or analogous provisions;
(10) each office or agency where, subject to the terms of the Indenture as
described below under "Payment and Paying Agents," the principal of and any
premium and interest on the Subordinated Debt Securities will be payable and
each office or agency where, subject to the terms of the Indenture as described
below under "Form, Exchange, Registration and Transfer", the Subordinated Debt
Securities may be presented for registration of transfer or exchange; (11) the
date, if any, after which and the price or prices at which the Subordinated
Debt Securities may be redeemed, in whole or in part, at the option of the
Company or repaid at the option of the Holder, or pursuant to mandatory
redemption provisions, and the other detailed terms and provisions of any such
optional or mandatory redemption or repayment provisions; (12) the
denominations in which any Subordinated Debt Securities will be issuable; (13)
the currency or currencies of payment of principal of and any premium and
interest on the Subordinated Debt Securities, if other than United States
dollars; (14) any index used to determine the amount of payments of principal
of and any premium and interest on the Subordinated Debt Securities; (15) the
portion of the principal amount of the Subordinated Debt Securities, if other
than the principal amount thereof, payable upon acceleration of maturity
thereof; (16) if the Company has elected not to apply the defeasance section of
the Indenture as described below under "Defeasance" to the Subordinated Debt
Securities; (17) the Person who shall be the Security Registrar for
Subordinated Debt Securities issuable as Registered Securities, if other than
the Trustee; the Person who shall be the initial Paying Agent and, if
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applicable, the Person who shall be the initial Common Depositary or the
depositary, as the case may be; and (18) any other terms of the Subordinated
Debt Securities not inconsistent with the provisions of the Indenture. Any such
Prospectus Supplement will also describe any special provisions for the payment
of additional amounts with respect to the Subordinated Debt Securities of such
series.
Subordinated Debt Securities may be issued as Original Issue Discount
Securities to be sold at a substantial discount below their stated principal
amounts. Special United States federal income tax considerations applicable to
Subordinated Debt Securities issued at an original issue discount will be set
forth in the Prospectus Supplement relating thereto. Special United States tax
considerations applicable to any Subordinated Debt Securities that are
denominated or payable in a currency other than United States dollars or that
use an index to determine the amount of payments of principal of and any
premium and interest on the Subordinated Debt Securities will be set forth in a
Prospectus Supplement relating thereto.
The Company may elect to structure a series of Subordinated Debt Securities
("Subordinated Capital Securities") to meet the additional requirements to
qualify as capital under regulations applicable to hybrid capital instruments
issued by bank holding companies whether or not such regulations may be
applicable to the Company at the time of issuance. See "Description of Capital
Securities." In such event, the applicable Prospectus Supplement will describe
the terms and conditions of the Subordinated Capital Securities.
CERTAIN MODIFICATIONS TO THE INDENTURE
As a savings and loan holding company, the Company is not presently subject
to regulations relating to minimum amounts or types of capital. Bank holding
companies are subject to such regulations and under certain of such regulations
subordinated debt securities meeting certain specified conditions are eligible
to be included in capital as defined in those regulations. On August 28, 1992,
the Board of Governors of the Federal Reserve System issued an interpretation,
effective September 4, 1992, with respect to the circumstances under which
subordinated debt issued by bank holding companies will be eligible for
inclusion as capital for regulatory capital purposes (the "Interpretation").
The Interpretation provides that subordinated debt securities issued after
September 4, 1992 will be included in capital for purposes of calculating a
bank holding company's capital ratios if, among other things, (i) the payment
of the principal amount of such debt securities can be accelerated only upon
the occurrence of certain events involving the bankruptcy of the issuer, (ii)
such debt securities are not subject to certain covenants, including covenants
limiting the sale of a major subsidiary, and (iii) such debt securities are
subordinate to all obligations for borrowed and purchased money, obligations
arising from off-balance sheet activities (including guarantees), and
obligations associated with derivative products. The Company has modified the
Indenture to comply with the Interpretation by entering into the First
Supplemental Indenture thereto dated as of January 5, 1993 (the "First
Supplemental Indenture"), and the Subordinated Debt Securities offered hereby
will be subject to such modifications.
SUBORDINATION
As used herein "Senior Indebtedness" means all Debt of the Company, except
Subordinated Indebtedness and Junior Subordinated Indebtedness; "Debt" of any
Person means the principal of and premium, if any, and interest on (i) all
indebtedness of such Person (including indebtedness of others guaranteed by
such Person), whether outstanding on the date of the Indenture or thereafter
created, incurred or assumed, which is (A) for money borrowed, whether or not
evidenced by bonds, debentures, notes or other written instruments or (B)
evidenced by a note or similar instrument given in connection with the
acquisition of any businesses, properties or assets of any kind, (ii)
obligations of, or any such obligations guaranteed by, such Person as lessee
under leases required to be capitalized on the balance sheet of the lessee
under generally accepted accounting principles and
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leases of property or assets made as part of any sale and lease-back
transaction to which such Person is a party, (iii) obligations of such Person
under letters of credit, (iv) any indebtedness of such Person under or other
obligations of such Person to make payment pursuant to the terms of commodity
contracts, interest rate and currency swap agreements, cap, floor and collar
agreements, currency spot and forward contracts, and other similar agreements
or arrangements designed to protect against fluctuations in currency exchange
or interest rates and (v) amendments, renewals, extensions, modifications and
refundings of any such indebtedness or obligation; "Subordinated Indebtedness"
means all Debt of the Company, other than Junior Subordinated Indebtedness,
which is subordinate and junior in right with respect to the general assets of
the Company to Senior Indebtedness and includes (A) the Subordinated Debt
Securities, (B) any Debt on a parity with any of the Subordinated Debt
Securities and (C) subordinated debt of the Company issued prior to January 5,
1993 (the date of the First Supplemental Indenture) (the "Prior Subordinated
Indebtedness"); and "Junior Subordinated Indebtedness" means all Debt of the
Company which is subordinate and junior in right with respect to the general
assets of the Company to all other Debt of the Company (including, without
limitation, Senior Indebtedness and Subordinated Indebtedness). (Section 101)
The definition of senior indebtedness with respect to Prior Subordinated
Indebtedness of the Company (see "Certain Modifications to the Indenture"
above) includes only indebtedness of or guaranteed by the Company for borrowed
money or evidenced by a note or similar instrument given in connection with the
acquisition of any businesses, properties or assets of any kind and obligations
of the Company as lessee (as described in (ii) above), other than obligations
ranking on a parity with or junior to such Prior Subordinated Indebtedness.
Thus, "Senior Indebtedness" as defined in the Indenture encompasses a broader
range of instruments and obligations than senior indebtedness as defined with
respect to such Prior Subordinated Indebtedness. As a result of this
difference, the holders of Subordinated Debt Securities offered hereby could be
subordinated to greater amounts of senior indebtedness of the Company than
holders of such Prior Subordinated Indebtedness of the Company and, under the
circumstances described in the following paragraph, holders of Subordinated
Debt Securities offered hereby may receive less, ratably, than holders of such
Prior Subordinated Indebtedness of the Company. As of January 31, 1993, the
Company, on an unconsolidated basis, had no Senior Indebtedness outstanding and
had outstanding $830,000,000 aggregate principal amount of Subordinated
Indebtedness, including $730,000,000 of Prior Subordinated Indebtedness. The
Indenture does not limit the amount of Senior Indebtedness of the Company and
the Company may incur Senior Indebtedness from time to time.
The payment of principal, premium, if any, and interest in respect of the
Subordinated Debt Securities is expressly subordinated, to the extent set forth
in the Indenture, to all Senior Indebtedness which may at any time and from
time to time be outstanding. In the event of any receivership, insolvency,
bankruptcy, assignment for the benefit of creditors, reorganization, whether or
not pursuant to bankruptcy laws, sale of all or substantially all of the assets
(except pursuant to Section 801 of the Indenture), dissolution, liquidation or
any other marshalling of the assets and liabilities of the Company, no amount
shall be paid by the Company in respect of the principal, premium, if any, or
interest on the Subordinated Debt Securities unless and until all Senior
Indebtedness shall have been paid in full together with all interest thereon
and all other amounts payable in respect thereof. (Section 1501)
The Indenture also states that, in the event of any default in the payment of
any Senior Indebtedness and during the continuance of any such default, no
amount shall be paid by the Company in respect of the principal, premium, if
any, or interest on the Subordinated Debt Securities. (Section 1501)
ABSENCE OF RESTRICTIVE COVENANTS AND EVENT RISK PROVISIONS
The Company is not restricted by the Indenture from incurring, assuming or
becoming liable for any type of debt or other obligations, from creating liens
on its property (including capital stock of the Association) for any purpose,
from paying dividends or making distributions on its capital stock
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or purchasing or redeeming its capital stock or from disposing of capital stock
of the Association. The Indenture does not require the maintenance of any
financial ratios or specified levels of net worth or liquidity. In addition,
the Indenture does not contain any provision which would require that the
Company repurchase or redeem or otherwise modify the terms of any of its
Subordinated Debt Securities upon a change in control or other events involving
the Company which may adversely affect the creditworthiness of the Subordinated
Debt Securities.
CONSOLIDATION, MERGER AND SALE OF ASSETS
The Company, without the consent of the Holders of any of the Outstanding
Securities under the Indenture, may consolidate with or merge into, or convey
or transfer its assets substantially as an entirety to, any Person that is a
corporation, partnership or trust organized and existing under the laws of the
United States of America or any State thereof or the District of Columbia,
provided that any successor Person assumes the Company's obligations on the
Subordinated Debt Securities and under the Indenture, that after giving effect
to the transaction no Event of Default and no event which, after notice or
lapse of time or both, would become an Event of Default shall have occurred and
be continuing, and that certain other conditions are met. (Section 801)
DEFAULTS AND CERTAIN RIGHTS ON DEFAULT
The Indenture defines an Event of Default with respect to any series of
Subordinated Debt Securities thereunder as being certain events of bankruptcy,
insolvency or reorganization involving the Company. (Section 501) The Company
will be required to file with the Trustee annually a written statement as to
the fulfillment of its obligations under the Indenture. (Section 1004) If an
Event of Default shall have occurred and is continuing with respect to
Subordinated Debt Securities of any series, the Trustee or the Holders of at
least 25% in aggregate principal amount of the Outstanding Securities of that
series by notice as provided in the Indenture may declare the principal amount
(or, if the Outstanding 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 and all accrued but unpaid interest on all the
Outstanding Subordinated Debt Securities of that series to be due and payable
immediately. At any time after a declaration of acceleration with respect to
Subordinated Debt Securities of any series has been made, but before a judgment
or decree for payment of money has been obtained by the Trustee, the Holders of
a majority in principal amount of the Outstanding Securities of that series
may, under certain circumstances, rescind and annul such acceleration. (Section
502)
The Indenture does not provide for any right of acceleration of the payment
of principal of the Subordinated Debt Securities of any series upon a default
in the payment of principal of (or premium, if any) or interest, if any, on the
Subordinated Debt Securities of such series, or in the performance of any
covenant or agreement in the Indenture or in the terms of the Subordinated Debt
Securities of such series. In the event of any default in the payment of the
principal of (or premium, if any) or interest, if any, on the Subordinated Debt
Securities of such series (including a default in payment at the Stated
Maturity of the Subordinated Debt Securities of such series), the Indenture
requires that the Company, upon demand of the Trustee, pay to the Trustee for
the benefit of the Holders of the Subordinated Debt Securities of such series,
the whole amount then due and payable on the Subordinated Debt Securities of
such series for principal (and premium, if any) and interest, if any. The
Indenture provides that if the Company fails to pay such amount forthwith upon
demand, the Trustee may, among other things, institute a judicial proceeding
for the collection thereof. (Section 503) The limitation on the right of
acceleration described above reflects a modification from prior subordinated
debt securities issued by the Company (including certain subordinated debt
securities issued under the Indenture). Any additional Events of Default with
respect to any series of Subordinated Debt Securities, including any related
right of acceleration, will be specified in the Prospectus Supplement relating
to such series.
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The Indenture provides that, subject to the duty of the Trustee during
default to act with the required standard of care, the Trustee will be under no
obligation to exercise any of its rights or powers under the Indenture at the
request or direction of any of the Holders, unless such Holders shall have
offered to the Trustee reasonable indemnity. (Sections 601 and 603) Subject to
such provisions for the indemnification of the Trustee, and subject to
applicable law and certain other provisions of the Indenture, the Holders of a
majority in principal amount of the Outstanding Securities of any series will
have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust or
power conferred on the Trustee, with respect to the Subordinated Debt
Securities of that series. (Section 512)
FORM, EXCHANGE, REGISTRATION AND TRANSFER
Subordinated Debt Securities of a series may be issuable in definitive form
solely as Registered Securities, solely as Bearer Securities or as both
Registered Securities and Bearer Securities. Unless otherwise indicated in an
applicable Prospectus Supplement, definitive Bearer Securities (other than
Bearer Securities in global form) will have interest coupons attached. The
Indenture also provides that Subordinated Debt Securities of a series may be
issuable in permanent global form. (Section 201) See "Permanent Global
Securities."
Registered Securities of any series (other than a Subordinated Debt Security
issued in global form) will be exchangeable for other Registered Securities of
the same series in any authorized denominations and of a like aggregate
principal amount and tenor. In addition, if Subordinated Debt Securities of any
series are issuable as both Registered Securities and Bearer Securities, at the
option of the Holder, and subject to the terms of the Indenture, Bearer
Securities (with all unmatured coupons and all matured coupons in default,
except as provided below) of such series will be exchangeable into Registered
Securities of the same series in any authorized denominations and of a like
aggregate principal amount and tenor. Bearer Securities surrendered in exchange
for Registered Securities after the close of business on a Regular Record Date
or a Special Record Date and before the opening of business on the relevant
date for payment of interest shall be surrendered without the coupon relating
to such date for payment of interest and interest will not be payable on such
date in respect of the Registered Security issued in exchange for such Bearer
Security, but will be payable only to the Holder of such coupon when due in
accordance with the terms of the Indenture. Bearer Securities will not be
issued in exchange for Registered Securities. (Section 305) Each Bearer
Security other than a temporary global Bearer Security will bear a legend
substantially to the following effect: "Any United States Person who holds this
obligation will be subject to limitations under the United States income tax
laws including the limitations provided in Sections 165(j) and 1287(a) of the
Internal Revenue Code."
Subordinated Debt Securities may be presented for exchange as provided above,
and Registered Securities (other than a Subordinated Debt Security issued in
global form) may be presented for registration of transfer (with the form of
transfer endorsed thereon duly executed), at the office of the Security
Registrar or at the office of any transfer agent designated by the Company for
such purpose with respect to any series of Subordinated Debt Securities and
referred to in an applicable Prospectus Supplement, without service charge and
upon payment of any taxes and other governmental charges as described in the
Indenture. (Section 305) If a Prospectus Supplement refers to any transfer
agents (in addition to the Security Registrar) initially designated by the
Company with respect to any series of Subordinated Debt Securities, the Company
may at any time rescind the designation of any such transfer agent or approve a
change in the location through which any such transfer agent (or Security
Registrar) acts, except that, if Subordinated Debt Securities of a series are
issuable solely as Registered Securities, the Company will be required to
maintain a transfer agent in each Place of Payment for such series and, if
Subordinated Debt Securities of a series are issuable as Bearer Securities, the
Company will be required to maintain (in addition to the
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Security Registrar) a transfer agent in a Place of Payment for such series
located outside the United States. The Company may at any time designate
additional transfer agents with respect to any series of Subordinated Debt
Securities. (Section 1002)
The Company shall not be required to (i) issue, register the transfer of, or
exchange Subordinated Debt Securities of any series during a period beginning
at the opening of business 15 days before (A) if Subordinated Debt Securities
of the series are issuable only as Registered Securities, the day of mailing of
the relevant notice of redemption and ending at the close of business on the
day for such mailing and (B) if Subordinated Debt Securities of the series are
issuable as either Bearer Securities or Registered Securities, the earlier of
the day of the first publication of the relevant notice of redemption or the
mailing of the relevant notice of redemption and ending on the close of
business on such earlier day, (ii) register the transfer of or exchange any
Registered Security, or portion thereof, called for redemption, except the
unredeemed portion of any Registered Security being redeemed in part; or (iii)
exchange any Bearer Security called for redemption, except to exchange such
Bearer Security for a Registered Security of that series and like tenor which
is simultaneously surrendered for redemption. (Section 305)
Additional information regarding restrictions on the issuance, exchange and
transfer of, and special United States federal tax considerations relating to,
Bearer Securities will be set forth in an applicable Prospectus Supplement.
PAYMENT AND PAYING AGENTS
Unless otherwise indicated in an applicable Prospectus Supplement, payment of
principal of and any premium and interest on Registered Securities will be made
at the office of such Paying Agent or Paying Agents as the Company may
designate from time to time, except that at the option of the Company payment
of interest on any Registered Security may be made by check mailed to the
address of the Person entitled thereto as such address shall appear in the
Security Register, or by wire transfer. Unless otherwise indicated in an
applicable Prospectus Supplement, payment of any installment of interest on
Registered Securities will be made to the person in whose name such Registered
Security is registered at the close of business on the Regular Record Date for
such interest. (Sections 307 and 1002)
Unless otherwise indicated in an applicable Prospectus Supplement, payment of
principal of and any premium and interest on Bearer Securities will be payable,
subject to any applicable laws and regulations, at the offices of such Paying
Agents outside the United States as the Company may designate from time to time
or, at the option of the Holder, by a check mailed to an address outside the
United States or by transfer to an account maintained by the payee with a bank
located outside the United States. (Section 1002) Unless otherwise indicated in
an applicable Prospectus Supplement, payment of interest on Bearer Securities
on any Interest Payment Date will be made only against surrender outside the
United States, to a Paying Agent, of the coupon relating to such Interest
Payment Date. (Section 1001 and 1002) No payment with respect to any Bearer
Security will be made at any office or agency of the Company in the United
States or by check mailed to any address in the United States or by transfer to
an account maintained with a bank located in the United States. Notwithstanding
the foregoing, payments of principal of and any premium and interest on Bearer
Securities denominated and payable in U.S. dollars will be made at the office
of the Company's Paying Agent in the Borough of Manhattan, The City of New
York, if (but only if) payment of the full amount thereof in U.S. dollars at
all offices or agencies maintained by the Company outside the United States is
illegal or effectively precluded by exchange controls or other similar
restrictions. (Section 1002)
Any Paying Agents outside the United States and any Paying Agents in the
United States initially designated by the Company for the Subordinated Debt
Securities will be named in an
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applicable Prospectus Supplement. The Company may at any time designate
additional Paying Agents or rescind the designation of any Paying Agent or
approve a change in the office through which any Paying Agent acts, except
that, if Subordinated Debt Securities of a series are issuable solely as
Registered Securities, the Company will be required to maintain a Paying Agent
in each Place of Payment for such series and, if Subordinated Debt Securities
of a series are issuable as Bearer Securities, the Company will be required to
maintain (i) a Paying Agent in the Borough of Manhattan, The City of New York
for payments with respect to any Registered Securities of the series (and for
payments with respect to Bearer Securities of the series in the limited
circumstances described above, but not otherwise), and (ii) a Paying Agent in a
Place of Payment located outside the United States where Subordinated Debt
Securities of such series and any coupons appertaining thereto may be presented
and surrendered for payment; provided that if the Subordinated Debt Securities
of such series are listed on The Stock Exchange of the United Kingdom and the
Republic of Ireland, the Luxembourg Stock Exchange or any other stock exchange
located outside the United States and such stock exchange shall so require, the
Company will maintain a Paying Agent in London, Luxembourg or any other
required city located outside the United States, as the case may be, for the
Subordinated Debt Securities of such series. (Section 1002)
All moneys deposited with the Trustee or any Paying Agent or held by the
Company in trust for the payment of principal of and any premium or interest on
any Subordinated Debt Security which remain unclaimed at the end of two years
after such principal, premium or interest shall have become due and payable,
will be discharged from trust and repaid to the Company and the Holder of such
Subordinated Debt Security or any coupon appertaining thereto will thereafter,
as an unsecured general creditor, look only to the Company for payment thereof.
(Section 1003)
TEMPORARY GLOBAL SECURITIES
If so specified in an applicable Prospectus Supplement, all or any portion of
the Subordinated Debt Securities of a series which are issuable as Bearer
Securities will initially be represented by one or more temporary global
Securities, without interest coupons, to be deposited with a common depositary
for Morgan Guaranty Trust Company of New York, Brussels Office, as operator of
the Euroclear System ("Euroclear") and CEDEL S.A. ("CEDEL") for credit to the
designated accounts. On and after the date determined as provided in any such
temporary global Security and described in an applicable Prospectus Supplement,
each such temporary global Security will be exchangeable for definitive Bearer
Securities, definitive Registered Securities or all or a portion of a permanent
global Bearer Security, or any combination thereof, as specified in an
applicable Prospectus Supplement, only upon written certification in the form
and to the effect described in the applicable Prospectus Supplement. No
definitive Bearer Security delivered in exchange for a portion of a temporary
global Security shall be mailed or otherwise delivered to any location in the
United States in connection with such exchange. (Sections 303 and 304)
Additional information regarding restrictions on and special United States
federal tax consequences relating to temporary global Securities will be set
forth in an applicable Prospectus Supplement.
PERMANENT GLOBAL SECURITIES
If any Subordinated Debt Securities of a series are issuable in permanent
global form, the applicable Prospectus Supplement will describe the
distribution procedures applicable to such securities in permanent global form
(including any applicable certification requirements) and the circumstances, if
any, under which beneficial owners of interests in any such permanent global
Security may exchange such interests for Subordinated Debt Securities of such
series and of like tenor and principal amount of any authorized form and
denomination. (Section 305) Principal of and any premium and interest on a
permanent global Security will be payable in the manner described in the
applicable Prospectus Supplement.
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MEETINGS, MODIFICATION AND WAIVER
Modifications and amendments of the Indenture may be made by the Company and
the Trustee with the consent of the Holders of not less than a majority in
aggregate principal amount of the Outstanding Securities of each series
affected by such modification or amendment; provided, however, that no such
modification or amendment may, without the consent of the Holder of each
Outstanding Security affected thereby, (a) change the Stated Maturity of the
principal of, or any installment of principal of or interest on, any
Subordinated Debt Security, (b) reduce the principal amount of any Subordinated
Debt Security or the rate of interest thereon or any premium payable upon the
redemption thereof, or impair the right to the delivery of Capital Securities,
if any, (c) change any obligation of the Company to pay additional amounts
pursuant to the terms of the Indenture, (d) reduce the amount of the principal
of an Original Issue Discount Security payable upon acceleration of the
Maturity thereof, (e) change the coin or currency in which any Subordinated
Debt Security or any premium or interest thereon is payable, (f) impair the
right to institute suit for the enforcement of any payment on or with respect
to any Subordinated Debt Security, (g) reduce the percentage in principal
amount of Outstanding Securities of any series, the consent of whose Holders is
required for modification or amendment of the Indenture or for waiver of
compliance with certain provisions of the Indenture or for waiver of certain
defaults, (h) reduce the requirements contained in the Indenture for quorum or
voting, (i) change any obligation of the Company to maintain an office or
agency in the places and for the purposes required by the Indenture, (j) modify
the terms of the Indenture relating to subordination in a manner adverse to the
Holders of Subordinated Debt Securities issued under the Indenture, (k)
adversely affect the right of repayment, if any, of the Subordinated Debt
Securities at the option of the Holders thereof, or (l) modify any of the above
provisions. (Section 902)
The Holders of not less than a majority in aggregate principal amount of the
Outstanding Securities of each series may, on behalf of all Holders of
Subordinated Debt Securities of that series and any coupons appertaining
thereto, waive any past default and its consequences under the Indenture with
respect to Subordinated Debt Securities of that series, except a default (a) in
the payment of principal of (or premium, if any) or any interest on any
Subordinated Debt Security or coupon of such series, and (b) in respect of a
covenant or provision of the Indenture which cannot be modified or amended
without the consent of the Holder of each Outstanding Security of such series
affected. (Section 513)
The Indenture provides that in determining whether the Holders of the
requisite principal amount of the Outstanding Securities have given any
request, demand, authorization, direction, notice, consent or waiver thereunder
or whether a quorum is present at a meeting of Holders of Subordinated Debt
Securities (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 a
Subordinated Debt Security denominated in a foreign currency or a composite
currency shall be the U.S. dollar equivalent, determined as of the date of
original issuance of such Subordinated Debt Security by the Company in good
faith, of the principal amount of such Subordinated Debt Security (or, in the
case of an Original Issue Discount Security, the U.S. dollar equivalent,
determined as of the date of original issuance of such Subordinated Debt
Security, of the amount determined as provided in (i) above) and (iii) except
as specified in the Indenture, Subordinated Debt Securities owned by the
Company or any other obligor upon the Subordinated Debt Securities or any
Affiliate of the Company or of such other obligor shall be disregarded and
deemed not to be Outstanding. (Section 101)
The Indenture contains provisions for convening meetings of the Holders of
Subordinated Debt Securities of a series. (Section 1301) A meeting may be
called at any time by the Trustee, and also, upon request, by the Company or
the Holders of at least 10% in principal amount of the Outstanding Securities
of such series, in any such case upon notice given in accordance with "Notices"
below. (Section 1302) Except for any consent which must be given by the Holder
of each Outstanding
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Security affected thereby, as described above, any resolution presented at a
meeting or adjourned meeting at which a quorum (as described below) is present
may be adopted by the affirmative vote of the Holders of a majority in
principal amount of the Outstanding Securities of that series; provided,
however, that, any resolution with respect to any request, demand,
authorization, direction, notice, consent, waiver or other action which may be
made, given or taken by the Holders of a specified percentage, which is greater
than a majority, in principal amount of the Outstanding Securities of a series
may be adopted at a meeting or adjourned meeting duly reconvened at which a
quorum is present by the affirmative vote of the Holders of such specified
percentage in principal amount of the Outstanding Securities of that series.
Any resolution passed or decision taken at any meeting of Holders of Securities
of any series duly held in accordance with the Indenture will be binding on all
Holders of Securities of that series and the related coupons. The quorum at any
meeting called to adopt a resolution, and at any reconvened meeting, will be
persons holding or representing a majority in principal amount of the
Outstanding Securities of a series, subject to certain exceptions. (Section
1304)
DEFEASANCE
The Indenture provides, unless the Company elects otherwise pursuant to
Section 301 of the Indenture with respect to the Subordinated Debt Securities
of any series, that the Company may elect to defease and be discharged from any
and all obligations with respect to such Subordinated Debt Securities (except
for the obligations to register the transfer or exchange of such Subordinated
Debt Securities, to replace temporary or mutilated, destroyed, lost or stolen
Subordinated Debt Securities, to maintain an office or agency in respect of the
Subordinated Debt Securities and to hold moneys for payment in trust)
("defeasance"), upon the deposit with the Trustee (or other qualifying
trustee), in trust for such purpose, of money, and/or U.S. Government
Obligations which through the payment of principal and interest in accordance
with their terms will provide money, in an amount sufficient to pay the
principal of and any premium and interest on such Subordinated Debt Securities,
and any mandatory sinking fund or analogous payments thereon, on the scheduled
due dates therefor and any amounts that may be payable at the option of a
Holder on the due date therefor. Such a trust may only be established if, among
other things, the Company has delivered to the Trustee an opinion of counsel
(as specified in the Indenture) to the effect that the Holders of such
Subordinated Debt Securities will not recognize income, gain or loss for
federal income tax purposes as a result of such defeasance and will be subject
to federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such defeasance had not occurred and, in
the case of Bearer Securities, there will be no adverse federal tax
consequences to the Holders of such Bearer Securities as a result of such
defeasance. Such opinion must refer to and be based upon a ruling of the
Internal Revenue Service or a change in applicable federal income tax law
occurring after the date of the Indenture. The Prospectus Supplement may
further describe the provisions, if any, permitting such defeasance with
respect to the Subordinated Debt Securities of a particular series. (Article
Fourteen)
NOTICES
Except as otherwise provided in the Indenture, notices to Holders of Bearer
Securities will be given by publication at least twice in a daily newspaper in
The City of New York and in such other city or cities as may be specified in
such Securities. Notices to Holders of Registered Securities will be given by
mail to the addresses of such Holders as they appear in the Security Register.
(Sections 101 and 106)
TITLE
Title to any Bearer Securities and any coupons appertaining thereto will pass
by delivery. The Company, the Trustee and any agent of the Company or the
Trustee may treat the bearer of any Bearer Security and the bearer of any
coupon and the registered owner of any Registered Security
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as the owner thereof (whether or not such Subordinated Debt Security or coupon
shall be overdue and notwithstanding any notice to the contrary) for the
purpose of making payment and for all other purposes. (Section 308)
REPLACEMENT OF SUBORDINATED DEBT SECURITIES AND COUPONS
Any mutilated Subordinated Debt Security or a Subordinated Debt Security with
a mutilated coupon appertaining thereto will be replaced by the Company at the
expense of the Holder upon surrender of such Subordinated Debt Security to the
Trustee. Subordinated Debt Securities or coupons that become destroyed, stolen
or lost will be replaced by the Company at the expense of the Holder upon
delivery to the Trustee of evidence of the destruction, loss or theft thereof
satisfactory to the Company and the Trustee; in the case of any coupon which
becomes destroyed, stolen or lost, such coupon will be replaced by issuance of
a new Subordinated Debt Security in exchange for the Subordinated Debt Security
to which such coupon appertains. In the case of a destroyed, lost or stolen
Subordinated Debt Security or coupon an indemnity satisfactory to the Trustee
and the Company may be required at the expense of the Holder of such
Subordinated Debt Security or coupon before a replacement Subordinated Debt
Security will be issued. (Section 306)
CONCERNING THE TRUSTEE
The Trustee may from time to time make loans to the Company and perform other
services for the Company in the normal course of its business. Under the
provisions of the Trust Indenture Act of 1939, as amended (the "Trust Indenture
Act"), upon the occurrence and continuance of a default under an indenture, if
a trustee has a conflicting interest (as defined in the Trust Indenture Act)
the trustee must, within 90 days, either eliminate such conflicting interest or
resign. Under the provisions of the Trust Indenture Act, an indenture trustee
shall be deemed to have a conflicting interest if (among other things), upon
the occurrence of a default under the indenture, the trustee is a creditor of
the obligor. If the trustee fails either to eliminate the conflicting interest
or to resign within 10 days after the expiration of such 90-day period, the
trustee is required to notify security holders to this effect and any security
holder who has been a bona fide holder for at least six months may petition a
court to remove the trustee and to appoint a successor trustee.
DESCRIPTION OF CAPITAL SECURITIES
General. The Company may issue a series of Subordinated Debt Securities that
are structured as Subordinated Capital Securities and that are payable at
Maturity only by exchange for, or from designated proceeds from the sale of,
Common Stock, Perpetual Preferred Stock or other capital securities of the
Company (the "Capital Securities"). Unless otherwise provided in the Prospectus
Supplement, whenever Subordinated Debt Securities are exchangeable for Capital
Securities, the Company will be obligated to deliver Capital Securities with a
Market Value (as defined below) equal to the excess, if any, of (i) the
outstanding principal amount of such Subordinated Debt Securities over (ii) the
principal amount of such Subordinated Debt Securities to be repaid in cash out
of Available Funds. In addition, the Company will unconditionally undertake to
sell the Capital Securities in a sale (the "Secondary Offering") on behalf of
any Holders who elect to receive cash for the Capital Securities. The Company
will bear all expenses of the Secondary Offering, including underwriting
discounts and commissions. If the Company fails to effect the Secondary
Offering, it will deliver to the Holders of Subordinated Debt Securities
Capital Securities, and not cash, upon exchange of the Subordinated Debt
Securities. The "Market Value" of any Capital Securities means their sale price
in the Secondary Offering. If the Company does not effect the Secondary
Offering, the Market Value of such Capital Securities shall be the average of
their fair value when exchanged as determined by three independent nationally
recognized investment banking firms selected by the Company.
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<PAGE>
Common Stock. Subject to any prior rights of the preferred stock, if any, of
the Company then outstanding, holders of the Company's Common Stock are
entitled to receive such dividends as are declared by the Board of Directors
out of funds legally available therefor. Subject to the rights of the holders
of the preferred stock, if any, in the event of liquidation of the Company, the
holders of the Common Stock are entitled to receive pro rata any assets
distributable to stockholders in respect of shares held by them. Subject to the
rights, if any, of the holders of shares of preferred stock, if any, all voting
rights are vested in the holders of shares of Common Stock, each share being
entitled to one vote. Stockholder action (including the election of directors)
may be taken without a meeting by the written consent of the holders of not
less than a majority (or such other percentage as may be required by law or the
Company's Certificate of Incorporation) of the stock entitled to vote. Holders
of Common Stock do not have any right to subscribe to any additional securities
which may be issued by the Company.
At December 31, 1992, the Company had 200,000,000 authorized shares of Common
Stock, $.10 par value, of which 63,924,810 shares were outstanding.
Perpetual Preferred Stock. The Company may select any Perpetual Preferred
Stock as Capital Securities to be exchanged for Subordinated Capital Securities
or to be sold and the proceeds of such sale designated on the books of the
Company as Available Funds. "Perpetual Preferred Stock" is any preferred stock
that is not mandatorily, or at the option of the holder, redeemable or
repayable, otherwise than in shares of Common Stock or Perpetual Preferred
Stock of another class or series or with the proceeds of the sale of Common
Stock or Perpetual Preferred Stock. Any shares of Perpetual Preferred Stock to
be so issued will have such designations, preferences, dividend and other
rights, qualifications, limitations and restrictions as may be determined by
the Company and approved by the Board of Directors.
At December 31, 1992, the Company had 20,000,000 authorized shares of
preferred stock, $1.00 par value, of which no shares were outstanding.
Other Capital Securities. The Company may also select any other securities to
be exchanged for Subordinated Capital Securities or to be sold and an amount
equal to the proceeds of such sale to be designated as Available Funds which
qualify at the time of their issuance as capital securities as determined by
the Company's then primary federal regulator. Such other capital securities
will have such terms as may be determined by the Company and approved by its
Board of Directors.
PLAN OF DISTRIBUTION
The Company may sell the Subordinated Debt Securities (i) to one or more
underwriters for public offering and sale by them and (ii) to investors
directly or through agents. The distribution of the Subordinated Debt
Securities may be effected from time to time in one or more transactions at a
fixed price or prices (which may be changed from time to time), at market
prices prevailing at the time of sale, at prices related to such prevailing
market prices or at negotiated prices. Each Prospectus Supplement will describe
the method of distribution of the Subordinated Debt Securities offered thereby.
In connection with the sale of the Subordinated Debt Securities,
underwriters, dealers or agents may receive compensation from the Company or
from purchasers of the Subordinated Debt Securities for whom they may act as
agents, in the form of discounts, concessions or commissions. The underwriters,
dealers or agents which participate in the distribution of the Subordinated
Debt Securities may be deemed to be underwriters under the Securities Act of
1933 and any discounts or commissions received by them and any profit on the
resale of the Subordinated Debt Securities received by them may be deemed to be
underwriting discounts and commissions thereunder. Any
15
<PAGE>
such underwriter, dealer or agent will be identified and any such compensation
received from the Company will be described in the Prospectus Supplement. Any
initial public offering price and any discounts or concessions allowed or
reallowed or paid to dealers may be changed from time to time.
Under agreements that may be entered into with the Company, underwriters,
dealers and agents may be entitled to indemnification by the Company against
certain civil liabilities, including liabilities under the Securities Act of
1933, or to contribution with respect to payments which the underwriters,
dealers or agents may be required to make in respect thereof.
All Subordinated Debt Securities will be new issues of securities with no
established trading market. Any underwriters to whom Subordinated Debt
Securities are sold by the Company for public offering and sale may make a
market in such securities, but such underwriters will not be obligated to do so
and may discontinue any market making at any time without notice. No assurance
can be given as to the liquidity of the trading market for any such securities.
Certain of the underwriters or agents and their associates may be customers
of, engage in transactions with and perform services for the Company in the
ordinary course of business.
VALIDITY
The validity of the Subordinated Debt Securities is being passed upon for the
Company by Orrick, Herrington & Sutcliffe, San Francisco, California.
EXPERTS
The consolidated financial statements and related supplemental schedules of
Golden West Financial Corporation and its subsidiaries incorporated in this
Prospectus by reference from the Company's Annual Report on Form 10-K for the
year ended December 31, 1991 have been audited by Deloitte & Touche,
independent auditors, as stated in their reports which are incorporated herein
by reference, and have been so incorporated in reliance upon such reports given
upon the authority of that firm as experts in accounting and auditing.
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NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS
SUPPLEMENT OR THE ACCOMPANYING PROSPECTUS AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY THE COMPANY OR ANY AGENT OR UNDERWRITER. THIS PROSPECTUS SUPPLEMENT AND THE
ACCOMPANYING PROSPECTUS DO NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF
AN OFFER TO BUY ANY OF THE SECURITIES OFFERED HEREBY IN ANY JURISDICTION TO ANY
PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION. NEITHER
THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT OR ANY PROSPECTUS NOR ANY SALE MADE
HEREUNDER OR THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION
THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE
HEREOF OR THEREOF.
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
PROSPECTUS SUPPLEMENT
<S> <C>
Consolidated Ratios of Earnings to Fixed Charges........................... S-2
Application of Proceeds.................................................... S-2
Description of the Notes................................................... S-2
Underwriting............................................................... S-5
Validity................................................................... S-5
PROSPECTUS
Available Information...................................................... 2
Information Incorporated by Reference...................................... 2
Golden West Financial Corporation.......................................... 3
Application of Proceeds.................................................... 4
Consolidated Ratios of Earnings to Fixed Charges........................... 4
Description of Subordinated Debt Securities................................ 4
Description of Capital Securities.......................................... 14
Plan of Distribution....................................................... 15
Validity................................................................... 16
Experts.................................................................... 16
</TABLE>
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$100,000,000
GOLDEN WEST
FINANCIAL
CORPORATION
6.70% SUBORDINATED NOTES
DUE JULY 1, 2002
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PROSPECTUS SUPPLEMENT
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GOLDMAN, SACHS & CO.
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