<PAGE> 1
As filed with the Securities and Exchange Commission on June ,1997
Registration No. 333- and 333- -01
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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HUNTINGTON BANCSHARES HUNTINGTON
INCORPORATED CAPITAL I
(Exact name of Registrant as specified in its charter) (Exact name of Registrant as specified in its charter)
Maryland Delaware
(State or other jurisdiction (State or other jurisdiction
of incorporation or organization) of incorporation or organization)
6711 6719
(Primary Standard Industrial (Primary Standard Industrial
Classification Code Number) Classification Code Number)
31-0724920 [applied for]
(I.R.S. Employer (I.R.S. Employer
Identification No.) Identification No.)
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Huntington Center c/o Huntington Bancshares Incorporated
41 South High Street Huntington Center
Columbus, Ohio 43287 41 South High Street
(614) 480-8300 Columbus, Ohio 43287
(614) 480-8300
(Address, including zip code, and telephone number, including (Address, including zip code, and telephone number, including
area code, of Registrant's principal executive offices) area code, of Registrant's principal executive offices)
</TABLE>
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Ralph K. Frasier, Esq.
General Counsel and Secretary
Huntington Bancshares Incorporated
Huntington Center; 41 South High Street
Columbus, Ohio 43287
(614) 480-4647
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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Copies of Correspondence to:
Mary Beth M. Clary
Porter, Wright, Morris & Arthur
4501 Tamiami Trail North, Suite 400
Naples, Florida 34103-3013
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Approximate date of commencement of proposed sale
of the securities to the public:
As soon as practicable after this Registration Statement becomes effective.
If the securities being registered on this Form are being offered in connection
with the formation of a holding company and there is compliance with General
Instruction G, check the following box. [ ]
CALCULATION OF REGISTRATION FEE
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PROPOSED
MAXIMUM OFFERING PROPOSED MAXIMUM AMOUNT OF
TITLE OF EACH CLASS OF AMOUNT TO BE PRICE PER AGGREGATE OFFERING REGISTRATION
SECURITIES TO BE REGISTERED(1) REGISTERED UNIT(2) PRICE PER UNIT(2) FEE(2)
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Floating Rate Junior Subordinated
Debentures of Huntington
Bancshares Incorporated(3)....... $200,000,000 $1,000 $200,000,000 N/A
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Floating Rate Capital Securities of
Huntington Capital I............. 200,000 $1,000 $200,000,000 $60,607
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Huntington Bancshares Incorporated
Guarantee with respect to the
Capital Securities(4)............ N/A N/A N/A N/A
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Total................................. $200,000,000(5) 100% $200,000,000(5) $60,607
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(1) This Registration Statement is deemed to cover the Floating Rate Junior
Subordinated Debentures of Huntington Bancshares Incorporated, the rights
of holders of Floating Rate Junior Subordinated Debentures of Huntington
Bancshares Incorporated under the Indenture, the rights of holders of
Capital Securities of Huntington Capital I under the Declaration, the
rights of holders of Floating Rate Capital Securities
<PAGE> 2
under the Guarantee of Huntington Bancshares Incorporated, which taken
together fully and unconditionally guarantee the obligations of
Huntington Capital I under the Capital Securities.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457.
(3) The Floating Rate Junior Subordinated Debentures were purchased by
Huntington Capital I with the proceeds of the sale of the Floating Rate
Capital Securities. No separate consideration will be received from
purchasers of Capital Securities for the Floating Rate Junior
Subordinated Debentures.
(4) No separate consideration will be received for the Huntington
Bancshares Incorporated Guarantee.
(5) Such amounts represent the aggregate liquidation amount of Capital
Securities to be issued and exchanged hereunder and the principal
amount of Floating Rate Junior Subordinated Debentures that may be
distributed to the holders of the Capital Securities upon liquidation
of Huntington Capital I.
THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a)
MAY DETERMINE.
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CROSS REFERENCE SHEET
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Form S-4 Item Prospectus Caption
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1. Forepart of Registration Statement and
Outside Front Cover Page of Prospectus........... Facing Page of Registration Statement; Cross Reference
Sheet; Cover Page of Prospectus.
2. Inside Front and Outside Back Cover
Pages of Prospectus.............................. Available Information; Incorporation of
Certain Information by Reference;
Table of Contents.
3. Risk Factors, Ratio of Earnings to Fixed
Charges and Other Information.................... Summary; Risk Factors; Ratio of
Earnings to Fixed Charges; Selected Financial
Data of the Company.
4. Terms of the Transaction......................... Cover Page of Prospectus; Summary; The Trust; The
Company; Use of Proceeds; Capitalization; Accounting
Treatment; The Exchange Offer; Description of New
Securities; Description of Old Securities; Relationship
Among The Capital Securities, The Subordinated Debentures,
and The Guarantee; Certain United States Federal Income
Tax Consequences ERISA Considerations; Plan of
Distribution.
5. Pro Forma Financial Information.................. Incorporation of Certain Documents By Reference.
6. Material Contracts with the
Company Being Acquired........................... Not Applicable.
7. Additional Information Required for
Reoffering by Persons and Parties
Deemed to Be Underwriters........................ Not Applicable.
8. Interests of Named Experts and Counsel........... Legal Matters; Experts.
9. Disclosure of Commission Position
on Indemnification for Securities
Act Liabilities ................................. Not Applicable.
10. Information with Respect to S-3 Registrants...... Incorporation of Certain Documents By Reference;
Summary; The Company.
11. Incorporation of Certain
Information by Reference......................... Incorporation of Certain Documents By Reference.
12. Information with Respect to S-2
or S-3 Registrants............................... Not Applicable.
13. Incorporation of Certain
Information by Reference......................... Not Applicable.
14. Information with Respect to Registrants
Other Than S-3 or S-2 Registrants................ Available Information; The Trust.
15. Information with Respect to S-3 Companies........ Not Applicable.
16. Information with Respect to S-2 or S-3
Companies........................................ Not Applicable.
17. Information with Respect to Companies
Other than S-3 or S-2 Companies.................. Not Applicable.
18. Information if Proxies, Consents or
Authorizations are to be Solicited............... Not Applicable.
19. Information if Proxies, Consents or
Authorizations are not to be Solicited
or in an Exchange Offer.......................... Incorporation of Certain Documents By Reference.
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(RED HERRING LANGUAGE APPEARS AT 90 DEGREES AND READS AS 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 STATE.
PROSPECTUS SUBJECT TO COMPLETION, dated June 30, 1997
$200,000,000
HUNTINGTON CAPITAL I
OFFER TO EXCHANGE ITS FLOATING RATE CAPITAL SECURITIES
WHICH HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
FOR ANY AND ALL OF ITS OUTSTANDING FLOATING RATE CAPITAL SECURITIES
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
FULLY AND UNCONDITIONALLY GUARANTEED TO THE EXTENT DESCRIBED HEREIN BY
HUNTINGTON BANCSHARES INCORPORATED
The Exchange Offer and Withdrawal Rights will expire at 5:00 p.m.,
New York City Time, on _________, 1997, unless extended.
Huntington Capital I, a statutory business trust created under the laws of
the State of Delaware (the "Trust"), hereby offers, upon the terms and subject
to the conditions set forth in this Prospectus (as the same may be amended or
supplemented from time to time, the "Prospectus") and in the accompanying Letter
of Transmittal (which together constitute the "Exchange Offer"), to exchange up
to $200,000,000 aggregate Liquidation Amount (as defined herein) of its Floating
Rate Capital Securities (Liquidation Amount $1,000 per Capital Security) (the
"New Capital Securities"), which have been registered under the Securities Act
of 1933, as amended (the "Securities Act"), pursuant to a Registration Statement
(as defined herein) of which this Prospectus constitutes a part, for a like
Liquidation Amount of its outstanding Floating Rate Capital Securities
(Liquidation Amount $1,000 per Capital Security) (the "Old Capital Securities"),
of which $200,000,000 aggregate Liquidation Amount is outstanding. Pursuant to
the Exchange Offer, Huntington Bancshares Incorporated, a Maryland corporation
(the "Company"), is also exchanging (i) its guarantee with respect to the
payment of Distributions (as defined herein) and other payments on liquidation
or redemption of the Old Capital Securities (the "Old Guarantee") for a like
guarantee with respect to the New Capital Securities (the "New Guarantee"), and
(ii) all of its outstanding Floating Rate Junior Subordinated Debentures (the
"Old Subordinated Debentures"), of which $206,186,000 aggregate
principal amount is outstanding, for a like aggregate principal amount of its
Floating Rate Junior Subordinated Debentures (the "New Subordinated
Debentures"), which New Guarantee and New Subordinated Debentures also have been
registered under the Securities Act. The Old Capital Securities, the Old
Guarantee, and the Old Subordinated Debentures are collectively referred to
herein as the "Old Securities" and the New Capital Securities, the New
Guarantee, and the New Subordinated Debentures are collectively referred to
herein as the "New Securities."
The terms of the New Securities are identical in all material respects to
the respective terms of the Old Securities, except that (i) the New Securities
have been registered under the Securities Act and therefore will not be subject
to certain restrictions on transfer applicable to the Old Securities, (ii) the
New Capital Securities will not provide for any increase in the distribution
rate thereon, and (iii) the New Subordinated Debentures will not provide for any
increase in the interest rate thereon. See "Description of New Securities" and
"Description of Old Securities." The New Capital Securities are being offered
for exchange in order to satisfy certain obligations of the Company and the
Trust under a Registration Rights Agreement, dated as of January 31, 1997 (the
"Registration Rights Agreement"), among the Company, the Trust, and the Initial
Purchasers (as defined herein) of the Old Capital Securities. In the event that
the Exchange Offer is consummated, any Old Capital Securities which remain
outstanding after consummation of the Exchange Offer and the New Capital
Securities issued in the Exchange Offer will vote together as a single class for
purposes of determining whether holders of the requisite percentage in
outstanding Liquidation Amount thereof have taken certain actions or exercised
certain rights under the Declaration (as defined herein).
(CONTINUED ON NEXT PAGE)
SEE "RISK FACTORS" BEGINNING ON PAGE ___ HEREOF FOR CERTAIN INFORMATION
RELEVANT TO AN INVESTMENT IN THE NEW CAPITAL SECURITIES INCLUDING THE PERIOD AND
CIRCUMSTANCES DURING AND UNDER WHICH PAYMENT OF DISTRIBUTIONS ON THE NEW CAPITAL
SECURITIES MAY BE DEFERRED AND CERTAIN RELATED UNITED STATES FEDERAL INCOME TAX
CONSEQUENCES.
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.
THESE SECURITIES ARE NOT DEPOSITS OR OTHER OBLIGATIONS OF A BANK AND
ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR
ANY OTHER GOVERNMENTAL AGENCY.
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The date of this Prospectus is _______ , 1997
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(cover page continued)
The New Capital Securities represent undivided beneficial ownership
interests in the assets of the Trust. The Company is the owner of all of the
beneficial ownership interests represented by common securities of the Trust
(the "Common Securities"; together with the Capital Securities (as defined
herein), the "Trust Securities"). The Trust exists for the sole purpose of
issuing the Trust Securities and investing the proceeds thereof in the
Subordinated Debentures (as defined herein). The Subordinated Debentures will
mature on February 1, 2027 (the "Stated Maturity"). The Capital Securities will
have a preference under certain circumstances with respect to Distributions and
amounts payable on liquidation, redemption, or otherwise over the Common
Securities. See "Description of New Securities -- Description of Capital
Securities -- Subordination of Common Securities."
As used herein, (i) the "Indenture" means the Indenture, dated as of
January 31, 1997, relating to the Subordinated Debentures, as amended and
supplemented from time to time, between the Company and The Chase Manhattan
Bank, as trustee (the "Indenture Trustee"), (ii) the "Declaration" means the
Amended and Restated Declaration of Trust relating to the Trust, dated as of
January 31, 1997, among the Company, as Sponsor, The Chase Manhattan Bank, as
Property Trustee (the "Property Trustee"), The Chase Manhattan Bank Delaware, as
Delaware Trustee (the "Delaware Trustee"), and three individuals who are
employees or officers of, or who are affiliated with, the Company (the "Regular
Trustees," and collectively with the Property Trustee and the Delaware Trustee,
the "Declaration Trustees"); (iii) the "Guarantee" means the Guarantee Agreement
between the Company and The Chase Manhattan Bank, as trustee (the "Guarantee
Trustee"), providing a guarantee, on the terms and conditions described herein,
for the benefit of holders of the Capital Securities. In addition, as the
context may require, unless expressly stated otherwise, (i) the "Capital
Securities" means the Old Capital Securities and the New Capital Securities,
(ii) the "Subordinated Debentures" means the Old Subordinated Debentures and the
New Subordinated Debentures, and (iii) the "Guarantee" means the Old Guarantee
and the New Guarantee.
Capital Securities issued in registered, global form will be deposited with
a custodian for and registered in the name of a nominee of The Depository Trust
Company ("DTC") and beneficial interests in such Capital Securities will be
shown on and transfers thereof will be effected through records maintained by
DTC and its participants.
The Capital Securities are listed on the Luxembourg Stock Exchange.
Holders of the Capital Securities are entitled to receive cumulative
cash distributions accruing from the date of original issuance of the Old
Capital Securities and payable quarterly in arrears on the last day of January,
April, July, and October of each year, commencing April 30, 1997, at a variable
annual rate equal to LIBOR (as defined herein) plus .70% on the Liquidation
Amount of $1,000 per Capital Security ("Distributions"). The final Distributions
will be payable on February 1, 2027, and will accrue from the last distribution
payment date prior to such date up to and including January 31, 2027. The
distribution rate and the distribution payment dates and other payment dates for
the Capital Securities correspond to the interest rate and interest payment
dates and other payment dates on the Subordinated Debentures, which are the
sole assets of the Trust. The Company guaranteed the payment of
Distributions and payments on liquidation of the Trust or redemption of the
Capital Securities, but only in each case to the extent of funds held by the
Trust, as described herein. See "Description of New Securities -- Description of
Guarantee." If the Company does not make interest payments on the Subordinated
Debentures held by the Trust, the Trust will have insufficient funds to pay
Distributions on the Capital Securities. The Company's obligations under the
Guarantee, taken together with its obligations under the Subordinated Debentures
and the Indenture, including its obligation to pay all costs, expenses, and
liabilities of the Trust (other than with respect to the Capital Securities),
constitute a full and unconditional guarantee of all of the Trust's obligations
under the Capital Securities. The obligations of the Company under the Guarantee
and the Subordinated Debentures are subordinate and junior in right of payment
to all Indebtedness (as defined in "Description of New Securities -- Description
of Subordinated Debentures -- Subordination") of the Company and are
structurally subordinated to all liabilities and obligations of the Company's
subsidiaries. As of March 31, 1997, approximately $369.3 million aggregate
principal amount of Indebtedness was outstanding, and the Company's subsidiaries
had approximately $19.5 billion of indebtedness and other liabilities
(including $13.9 billion of bank deposits). The terms of the Subordinated
Debentures place no limitation on the amount of Indebtedness that may be
incurred by the Company or on the amount of liabilities and obligations of the
Company's subsidiaries. See "Description of New Securities -- Description of
Subordinated Debenture -- Subordination."
The Company has the right to defer payment of interest on the Subordinated
Debentures at any time or from time to time for a period not exceeding 20
consecutive quarters with respect to each deferral period (each, an "Extension
Period"), provided that no Extension Period may extend beyond the Stated
Maturity of the Subordinated Debentures. Upon the termination of any such
Extension Period and the payment of all amounts then due on any Interest Payment
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Date (as defined herein), the Company may elect to begin a new Extension Period
subject to the requirements set forth herein. Accordingly, there could be
multiple Extension Periods of varying lengths throughout the term of the
Subordinated Debentures. If interest payments on the Subordinated Debentures are
so deferred, distributions on the Capital Securities will also be deferred and
the Company may not, and may not permit any subsidiary of the Company to, (i)
declare or pay any dividends or distributions on, or redeem, purchase, acquire,
or make a liquidation payment with respect to, the Company's capital stock or
(ii) make any payment of principal, interest, or premium, if any, on or repay,
repurchase, or redeem any debt securities that rank pari passu with or junior to
the Subordinated Debentures or make any guarantee payments with respect to any
guarantee by the Company of the debt securities of any subsidiary of the Company
if such guarantee ranks pari passu with or junior to the Subordinated Debentures
(other than (a) repurchases, redemptions, or other acquisitions of shares of
capital stock of the Company in connection with any employment contract, benefit
plan, or other similar arrangement with or for the benefit of any one or more
employees, officers, directors, or consultants, or in connection with a dividend
reinvestment or stockholder stock purchase plan, (b) as a result of an exchange
or conversion of any class or series of the Company's capital stock (or any
capital stock of a subsidiary of the Company) for any other class or series of
the Company's capital stock or of any class or series of the Company's
indebtedness for any class or series of the Company's capital stock, (c) the
purchase of fractional interests in shares of the Company's capital stock
pursuant to the conversion or exchange provisions of such capital stock or the
security being converted or exchanged, (d) any declaration of a dividend in
connection with any stockholders' rights plan, or the issuance of rights, stock,
or other property under any stockholders' rights plan, or the redemption or
repurchase of rights pursuant thereto, or (e) any dividend in the form of stock,
warrants, options, or other rights where the dividend stock or the stock
issuable upon exercise of such warrants, options, or other rights is the same
stock as that on which the dividend is being paid (or ranks pari passu with or
junior to such stock)). During an Extension Period, interest on the Subordinated
Debentures will continue to accrue (and the amount of Distributions to which
holders of the Capital Securities are entitled will accumulate) at a variable
rate equal to LIBOR plus .70%, compounded quarterly, and holders of the Capital
Securities will be required to accrue interest income for United States federal
income tax purposes prior to receipt of the cash related to such interest
income. See "Description of New Securities -- Description of Subordinated
Debentures -- Option to Extend Interest Payment Period" and "Certain United
States Federal Income Tax Consequences -- Interest Income and Original Issue
Discount."
The Subordinated Debentures are not redeemable prior to February 1, 2007,
unless a Special Event (as defined herein) has occurred. The Subordinated
Debentures are redeemable prior to maturity at the option of the Company,
subject to the receipt of any necessary prior approval from the Board of
Governors of the Federal Reserve System (the "Federal Reserve") (i) on or after
February 1, 2007, in whole or in part, at a redemption price equal to the
principal amount of the Subordinated Debentures so redeemed plus the accrued and
unpaid interest thereon to the redemption date, or (ii) at any time, in whole
(but not in part), upon the occurrence and continuation of a Special Event, at
such redemption price. The Capital Securities are subject to mandatory
redemption, in whole or in part, upon repayment of the Subordinated Debentures
at Stated Maturity or their earlier redemption, in an amount equal to the amount
of related Subordinated Debentures maturing or being redeemed and at a
redemption price equal to the redemption price of such Subordinated Debentures,
in each case plus accumulated and unpaid Distributions thereon to the date of
redemption.
Upon the occurrence and continuation of a Special Event, the Company will
have the right, subject to the receipt of any necessary prior approval from the
Federal Reserve, to dissolve the Trust and cause the Subordinated Debentures to
be distributed to the holders of the Capital Securities and the Common
Securities in liquidation of the Trust. See "Description of New Securities --
Description of Capital Securities -- Redemption -- Special Event Redemption or
Distribution of Subordinated Debentures."
In the event of the liquidation of the Trust, after satisfaction of the
claims of creditors of the Trust, if any, as provided by applicable law, the
holders of the Capital Securities will be entitled to receive a Liquidation
Amount of $1,000 per Capital Security plus accumulated and unpaid Distributions
thereon to the date of payment, which may be in the form of a distribution of
such amount in Subordinated Debentures as described above. If such Liquidation
Amount can be paid only in part because the Trust has insufficient assets
available to pay in full the aggregate Liquidation Amount, then the amounts
payable directly by the Trust on the Capital Securities shall be paid on a pro
rata basis. The holder of the Common Securities will be entitled to receive
distributions upon any such liquidation pro rata with the holders of the Capital
Securities, except that if an Indenture Event of Default (as defined herein) has
occurred and is continuing, the Capital Securities will have a priority over the
Common Securities. See "Description of New Securities -- Description of Capital
Securities -- Liquidation Distribution Upon Dissolution."
The Trust is making the Exchange Offer of the New Capital Securities in
reliance on the position of the staff of the Division of Corporation Finance of
the Securities and Exchange Commission (the "Commission") as set forth in
certain interpretive letters addressed to third parties in other transactions.
However, neither the Company nor the Trust has
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<PAGE> 8
sought its own interpretive letter, and there can be no assurance that the staff
of the Division of Corporation Finance of the Commission would make a similar
determination with respect to the Exchange Offer as it has in such interpretive
letters to third parties. Based on these interpretations by the staff of the
Division of Corporation Finance, and subject to the two immediately following
sentences, the Company and the Trust believe that New Capital Securities issued
pursuant to this Exchange Offer in exchange for Old Capital Securities may be
offered for resale, resold, and otherwise transferred by a holder thereof (other
than a holder who is a broker-dealer) without further compliance with the
registration and prospectus delivery requirements of the Securities Act,
provided that such New Capital Securities are acquired in the ordinary course of
such holder's business and that such holder is not participating, and has no
arrangement or understanding with any person to participate, in a distribution
(within the meaning of the Securities Act) of such New Capital Securities.
However, any holder of Old Capital Securities who is an "affiliate" of the
Company or the Trust within the meaning of Rule 405 under the Securities Act (an
"Affiliate") or who intends to participate in the Exchange Offer for the purpose
of distributing New Capital Securities, or any broker-dealer who purchased Old
Capital Securities from the Trust to resell pursuant to Rule 144A under the
Securities Act ("Rule 144A") or any other available exemption under the
Securities Act, (i) will not be able to rely on the interpretations of the staff
of the Division of Corporation Finance of the Commission set forth in the
above-mentioned interpretive letters, (ii) will not be entitled to tender such
Old Capital Securities in the Exchange Offer, and (iii) must comply with the
registration and prospectus delivery requirements of the Securities Act in
connection with any sale or other transfer of such Old Capital Securities unless
such sale is made pursuant to an exemption from such requirements. In addition,
as described below, if any broker-dealer (a "Participating Broker-Dealer") holds
Old Capital Securities acquired for its own account as a result of market-making
or other trading activities and exchanges such Old Capital Securities for New
Capital Securities, then such Participating Broker-Dealer must deliver a
prospectus meeting the requirements of the Securities Act in connection with any
resales of such New Capital Securities.
Each holder of Old Capital Securities who wishes to exchange Old Capital
Securities for New Capital Securities in the Exchange Offer will be required to
represent that (i) it is not an Affiliate, (ii) any New Capital Securities to be
received by it are being acquired in the ordinary course of its business, (iii)
it has no arrangement or understanding with any person to participate in a
distribution (within the meaning of the Securities Act) of such New Capital
Securities, and (iv) if such holder is not a broker-dealer, such holder is not
engaged in, and does not intend to engage in, a distribution (within the meaning
of the Securities Act) of such New Capital Securities. The Letter of Transmittal
contains the foregoing representations. In addition, the Company and the Trust
may require such holder, as a condition to such holder's eligibility to
participate in the Exchange Offer, to furnish to the Company and the Trust (or
an agent thereof) in writing information as to the number of "beneficial owners"
(within the meaning of Rule 13d-3 under the Securities Exchange Act of 1934, as
amended (the "Exchange Act")) on behalf of whom such holder holds the Old
Capital Securities to be exchanged in the Exchange Offer. Each Participating
Broker-Dealer that receives New Capital Securities for its own account pursuant
to the Exchange Offer will be deemed to have acknowledged by execution of the
Letter of Transmittal or delivery of an Agent's Message (as defined herein) that
it acquired the Old Capital Securities for its own account as the result of
market-making activities or other trading activities and must agree that it will
deliver a prospectus meeting the requirements of the Securities Act in
connection with any resale of such New Capital Securities. The Letter of
Transmittal states that by so acknowledging and by delivering a prospectus, a
Participating Broker-Dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act. Based on the position
taken by the staff of the Division of Corporation Finance of the Commission in
the interpretive letters referred to above, the Company and the Trust believe
that Participating Broker-Dealers may fulfill their prospectus delivery
requirements with respect to the New Capital Securities received upon exchange
of such Old Capital Securities (other than Old Capital Securities which
represent an unsold allotment from the original sale of the Old Capital
Securities) with a prospectus meeting the requirements of the Securities Act,
which may be the prospectus prepared for an exchange offer so long as it
contains a description of the plan of distribution with respect to the resale of
such New Capital Securities. Accordingly, this Prospectus, as it may be amended
or supplemented from time to time, may be used by a Participating Broker-Dealer
during the period referred to below in connection with resales of New Capital
Securities received in exchange for Old Capital Securities where such Old
Capital Securities were acquired by such Participating Broker-Dealer for its own
account as a result of market-making or other trading activities. Subject to
certain provisions set forth in the Registration Rights Agreement, the Company
and the Trust have agreed that this Prospectus, as it may be amended or
supplemented from time to time, may be used by a Participating Broker-Dealer in
connection with resales of such New Capital Securities for a period ending 180
days after the Expiration Date (as defined herein) or, if earlier, when all such
New Capital Securities have been disposed of by such Participating
Broker-Dealer. See "Plan of Distribution." Any person, including any
Participating Broker-Dealer, who is an Affiliate may not rely on such
interpretive letters and must comply with the registration and prospectus
delivery requirements of the Securities Act in connection with any resale
transaction. See "The Exchange Offer -- Resales of New Capital Securities."
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In that regard, each Participating Broker-Dealer who surrenders Old Capital
Securities pursuant to the Exchange Offer will be deemed to have agreed, by
execution of the Letter of Transmittal or delivery of an Agent's Message, that,
upon receipt of notice from the Company or the Trust of the occurrence of any
event or the discovery of any fact which makes any statement contained or
incorporated by reference in this Prospectus untrue in any material respect or
which causes this Prospectus to omit to state a material fact necessary in order
to make the statements contained or incorporated by reference herein, in the
light of the circumstances under which they were made, not misleading, or of the
occurrence of certain other events specified in the Registration Rights
Agreement, such Participating Broker-Dealer will suspend the sale of New Capital
Securities pursuant to this Prospectus until the Company or the Trust has
amended or supplemented this Prospectus to correct such misstatement or omission
and has furnished copies of the amended or supplemented Prospectus to such
Participating Broker-Dealer, or the Company or the Trust has given notice that
the sale of the New Capital Securities may be resumed, as the case may be.
Prior to the Exchange Offer, there has been only a limited secondary market
and no public market in the United States for the Old Capital Securities. The
New Capital Securities will be a new issue of securities for which there
currently is no market. There can be no assurance as to the development or
liquidity of any market for the New Capital Securities. The Company currently
does not intend to apply for listing of the New Capital Securities on any
securities exchange in the United States or for quotation through the National
Association of Securities Dealers Automated Quotation System. The Capital
Securities have been listed on the Luxembourg Exchange.
Any Old Capital Securities not tendered and accepted in the Exchange Offer
will remain outstanding and will be entitled to all the same rights and will be
subject to the same limitations applicable thereto under the Declaration (except
for those rights which terminate upon consummation of the Exchange Offer).
Following consummation of the Exchange Offer, the holders of Old Capital
Securities will continue to be subject to all of the existing restrictions upon
transfer thereof and neither the Company nor the Trust will have any further
obligation to such holders (other than under certain limited circumstances) to
provide for registration under the Securities Act of the Old Capital Securities
held by them. To the extent that Old Capital Securities are tendered and
accepted in the Exchange Offer, a holder's ability to sell untendered Old
Capital Securities could be adversely affected. See "Risk Factors --
Consequences of a Failure to Exchange Old Capital Securities."
THIS PROSPECTUS AND THE RELATED LETTER OF TRANSMITTAL CONTAIN IMPORTANT
INFORMATION. HOLDERS OF OLD CAPITAL SECURITIES ARE URGED TO READ THIS PROSPECTUS
AND THE RELATED LETTER OF TRANSMITTAL CAREFULLY BEFORE DECIDING WHETHER TO
TENDER THEIR OLD CAPITAL SECURITIES PURSUANT TO THE EXCHANGE OFFER.
Old Capital Securities may be tendered for exchange on or prior to 5:00
p.m., New York City time, on __________, 1997 (such time on such date being
hereinafter called the "Expiration Date"), unless the Exchange Offer is extended
by the Company and the Trust (in which case the term "Expiration Date" shall
mean the latest date and time to which the Exchange Offer is extended). Tenders
of Old Capital Securities may be withdrawn at any time on or prior to the
Expiration Date. The Exchange Offer is not conditioned upon any minimum
Liquidation Amount of Old Capital Securities being tendered for exchange.
However, the Exchange Offer is subject to certain events and conditions which
may be waived by the Company or the Trust and to the terms and provisions of the
Registration Rights Agreement. The Company has agreed to pay all expenses of the
Exchange Offer, except as otherwise specified herein. See "The Exchange Offer --
Fees and Expenses." Each New Capital Security will pay cumulative Distributions
from the most recent Distribution Date (as defined herein) on the Old Capital
Securities surrendered in exchange for such New Capital Securities. Holders of
the Old Capital Securities whose Old Capital Securities are accepted for
exchange will not receive accumulated Distributions on such Old Capital
Securities for any period from and after the last Distribution Date on such Old
Capital Securities prior to the original issue date of the New Capital
Securities and will be deemed to have waived the right to receive any
Distributions on such Old Capital Securities accumulated from and after such
Distribution Date. This Prospectus, together with the Letter of Transmittal, is
being sent to all registered holders of Old Capital Securities as of
_________________ , 1997.
Neither the Company nor the Trust will receive any proceeds from the
issuance of the New Capital Securities offered hereby. No dealer-manager is
being used in connection with this Exchange Offer. See "Use of Proceeds" and
"Plan of Distribution."
THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WHICH ARE NOT PRESENTED
HEREIN OR DELIVERED HEREWITH. THESE DOCUMENTS ARE AVAILABLE UPON REQUEST FROM
CHERI GRAY, INVESTOR RELATIONS ANALYST, HUNTINGTON BANCSHARES
6
<PAGE> 10
INCORPORATED, HUNTINGTON CENTER, 41 SOUTH HIGH STREET, COLUMBUS, OHIO 43287,
TELEPHONE NUMBER 614-480-3803. IN ORDER TO ENSURE TIMELY DELIVERY OF THE
DOCUMENTS, ANY REQUEST SHOULD BE MADE BY ____________________, 1997.
NO EMPLOYEE BENEFIT OR OTHER PLAN OR INDIVIDUAL RETIREMENT ACCOUNT SUBJECT
TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED,
OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (EACH, A
"PLAN"), NO ENTITY WHOSE UNDERLYING ASSETS INCLUDE "PLAN ASSETS" BY REASON OF
ANY PLAN'S INVESTMENT IN THE ENTITY (A "PLAN ASSET ENTITY"), AND NO PERSON
INVESTING "PLAN ASSETS" OF ANY PLAN MAY ACQUIRE OR HOLD THE CAPITAL SECURITIES
OR ANY INTEREST THEREIN, UNLESS SUCH PURCHASE OR HOLDING IS COVERED BY THE
EXEMPTIVE RELIEF PROVIDED BY U.S. DEPARTMENT OF LABOR PROHIBITED TRANSACTION
CLASS EXEMPTION ("PTCE") 96-23, 95-60, 91-38, 90-1, OR 84-14 OR ANOTHER
APPLICABLE EXEMPTION WITH RESPECT TO SUCH PURCHASE OR HOLDING. ANY PURCHASER OR
HOLDER OF THE CAPITAL SECURITIES OR ANY INTEREST THEREIN WILL BE DEEMED TO HAVE
REPRESENTED BY ITS PURCHASE AND HOLDING THEREOF THAT EITHER (A) THE PURCHASER
AND HOLDER IS NOT A PLAN OR A PLAN ASSET ENTITY AND IS NOT PURCHASING SUCH
SECURITIES ON BEHALF OF OR WITH "PLAN ASSETS" OF ANY PLAN OR (B) THE PURCHASE
AND HOLDING OF THE CAPITAL SECURITIES IS COVERED BY THE EXEMPTIVE RELIEF
PROVIDED BY PTCE 96-23, 95-60, 91-38, 90-1, OR 84-14 OR ANOTHER APPLICABLE
EXEMPTION WITH RESPECT TO SUCH PURCHASE OR HOLDING.
7
<PAGE> 11
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
Available Information .......................................................................
Incorporation of Certain Information by Reference ...........................................
Summary .....................................................................................
Risk Factors ................................................................................
The Trust ...................................................................................
The Company..................................................................................
Selected Financial Data of the Company ......................................................
Ratio of Earnings to Fixed Charges ..........................................................
Capitalization ..............................................................................
Use of Proceeds .............................................................................
Accounting Treatment ........................................................................
Exchange Offer ..............................................................................
Description of New Securities ...............................................................
Description of Old Securities ...............................................................
Relationship Among the Capital Securities, the Subordinated Debentures, and the Guarantee ...
Certain United States Federal Income Tax Consequences .......................................
Book-Entry Issuance .........................................................................
ERISA Considerations .......................................................................
Plan of Distribution ........................................................................
Legal Matters ...............................................................................
Experts .....................................................................................
</TABLE>
Appendix A-Form of Transmittal Letter
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS, AND, IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE SECURITIES
DESCRIBED IN THIS PROSPECTUS OR AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER
TO BUY SUCH SECURITIES IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION
IS UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER
SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION
CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE OF SUCH
INFORMATION.
8
<PAGE> 12
AVAILABLE INFORMATION
The Company is subject to the reporting requirements of Sections 13 and
15(d) of the Exchange Act. Any reports and other information filed by the
Company with the Commission may be inspected and copied at the public reference
facilities maintained by the Commission at Judiciary Plaza, 450 Fifth Street,
N.W., Washington, D.C. 20549, and at the Commission's regional offices in
Chicago, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661, and in
New York, 7 World Trade Center, 13th Floor, New York, New York 10048. Copies of
such material may also be obtained by mail from the Public Reference Section of
the Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C.
20549, at prescribed rates. Such material may also be accessed electronically by
means of the Commission's home page on the Internet (http://www.sec.gov).
The Company and the Trust have filed with the Commission a Registration
Statement on Form S-4 (together with all amendments and exhibits thereto, the
"Registration Statement") under the Securities Act with respect to the
securities offered hereby. This Prospectus does not contain all of the
information set forth in the Registration Statement, certain portions of which
have been omitted as permitted by the rules and regulations of the Commission.
For further information with respect to the Company and the securities offered
hereby, reference is made to the Registration Statement and the exhibits and
financial statements, notes, and schedules filed as part thereof or incorporated
by reference therein, which may be inspected at the public reference facilities
of the Commission, at the addresses set forth above. Statements made in this
Prospectus concerning the contents of any documents referred to herein are not
necessarily complete, and in each instance are qualified in all respects by
reference to the copy of such document filed as an exhibit to the Registration
Statement.
No separate financial statements of the Trust have been included herein
and no separate financial statements will be prepared in the future. The Company
and the Trust do not consider that such financial statements would be material
to holders of the securities offered hereby because (i) all of the voting
securities of the Trust will be owned, directly or indirectly, by the Company,
(ii) the Trust has no independent operations and exists for the sole purpose of
issuing securities representing undivided beneficial interests in the assets of
the Trust and investing the proceeds thereof in the representative series of
Subordinated Debentures issued by the Company, and (iii) the obligations of the
Trust under its Capital Securities are fully and unconditionally guaranteed by
the Company to the extent the Trust has funds available to meet such
obligations. In addition, the Company does not expect that the Trust will be
filing reports under the Exchange Act with the Commission.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents, which have been filed by the Company with the
Commission pursuant to Section 13(a) or 15(d) of the Exchange Act, are
incorporated by reference in this Prospectus to the extent provided below:
(i) Annual Report on Form 10-K for the year ended December 31, 1996;
(ii) Quarterly Report on Form 10-Q for the quarter ended March 31,
1997;
(iii) Current Reports on Form 8-K, dated January 15, 1997, April 9,
1997, May 5, 1997, and June 19, 1997; and
(iv) the financial data under the heading "Pro Forma Financial
Statements" in the Company's Registration Statement on Form S-4
filed with the Commission on June 27, 1997, in connection with
the Company's acquisition of First Michigan Bank Corporation.
All documents filed by the Company pursuant to Sections 13(a), 14, or
15(d) of the Exchange Act, after the date hereof and prior to the termination of
the offering hereunder shall be deemed to be incorporated by reference in this
Prospectus and to be a part hereof from the date of filing of such documents.
Any statement contained in a document incorporated by reference or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for all purposes of this Prospectus to the extent that a statement contained
herein or in any subsequently filed document that is also incorporated or deemed
to be incorporated by reference herein modifies or supersedes such statement.
Any such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus.
The Company will provide without charge to each person to whom a copy
of this Prospectus has been delivered, on the written or oral request of such
person, a copy of any or all of the documents referred to above that have been
or may be incorporated in this Prospectus by reference, other than exhibits to
such documents, unless such exhibits are specifically incorporated by reference
therein. Requests for such copies should be directed to: Cheri Gray,
9
<PAGE> 13
Investor Relations Analyst, Huntington Bancshares Incorporated, Huntington
Center, 41 South High Street, Columbus, Ohio 43287, telephone number
614-480-3803. In addition, such documents are available, free of charge, from
Chase Manhattan Bank Luxembourg S.A. 5 Rue Plaetis, L-2338, Luxembourg.
10
<PAGE> 14
SUMMARY
The following information is a summary of certain information contained
herein and should be read in conjunction with such information contained
elsewhere in this Prospectus and is subject to, and qualified in its entirety by
reference to, such information. Capitalized terms used herein have the
respective meanings ascribed to them elsewhere in this Prospectus.
THE COMPANY
The Company, a multi-state bank holding company incorporated under the
laws of the State of Maryland in 1966, is headquartered in Columbus, Ohio. At
March 31, 1997, the Company had total assets of approximately $21.6 billion and
total deposits of approximately $13.9 billion. The Company, through its
affiliates, conducts a full service commercial and consumer banking business,
engages in mortgage banking, lease financing, trust services, discount brokerage
services, underwriting credit life and disability insurance, and issuing
commercial paper guaranteed by the Company, and provides other financial
products and services. At March 31, 1997, the Company's affiliates had 202
banking offices in Ohio and Northern Kentucky, 43 banking offices in West
Virginia, 43 banking offices in Michigan, 43 banking offices in Florida, 24
banking offices in Indiana, and one foreign office in the Cayman Islands. In
addition, the Company's mortgage company affiliate has loan origination offices
throughout the Midwest and East Coast. The principal executive offices of the
Company are located at Huntington Center, 41 South High Street, Columbus, Ohio
43287 (telephone number 614-480-8300).
THE EXCHANGE OFFER
General....................... Up to $200,000,000 aggregate Liquidation Amount
of New Capital Securities are being offered in
exchange for a like aggregate Liquidation Amount
of Old Capital Securities. The Company and the
Trust are making the Exchange Offer in order to
satisfy their obligations under the Registration
Rights Agreement relating to the Old Capital
Securities. For a description of the procedures
for tendering Old Capital Securities, see "The
Exchange Offer -- Procedures for Tendering Old
Capital Securities."
Expiration Date.............. The Expiration Date of the Exchange Offer will
be 5:00 p.m., New York City time, on
________________ , 1997, unless the Exchange
Offer is extended by the Company and the Trust.
See "The Exchange Offer -- Expiration Date;
Extensions; Amendments."
Conditions to
Exchange Offer........... The Exchange Offer is subject to certain
conditions, which may be waived by the Company
and the Trust in their sole discretion. The
Exchange Offer is not conditioned upon any
minimum Liquidation Amount of Old Capital
Securities being tendered. See "The Exchange
Offer -- Conditions to Exchange Offer." The
Company and the Trust reserve the right in their
sole discretion, subject to applicable law, at
any time and from time to time, (i) to delay the
acceptance of the Old Capital Securities for
exchange, (ii) to terminate the Exchange Offer
if certain specified conditions have not been
satisfied, (iii) to extend the Expiration Date
of the Exchange Offer and retain all Old Capital
Securities tendered pursuant to the Exchange
Offer, subject, however, to the right of holders
of Old Capital Securities to withdraw their
tendered Old Capital Securities, or (iv) to
waive any condition or otherwise amend the terms
of the Exchange Offer in any respect. See "The
Exchange Offer -- Expiration Date; Extensions;
Amendments."
Withdrawal Rights............ Tenders of Old Capital Securities may be
withdrawn at any time on or prior to the
Expiration Date by delivering a written notice
of such withdrawal to The Chase Manhattan Bank,
as Exchange Agent (the "Exchange Agent"), in
conformity with certain procedures set forth
below under "The Exchange Offer -- Withdrawal
Rights."
11
<PAGE> 15
Procedures for Tendering
Old Capital Securities.... Tendering holders of Old Capital Securities must
complete and sign a Letter of Transmittal in
accordance with the instructions contained
therein and forward the same by mail, facsimile,
or hand delivery, together with any other
required documents, to the Exchange Agent,
either with the Old Capital Securities to be
tendered or in compliance with the specified
procedures for guaranteed delivery of Old
Capital Securities. Certain brokers, dealers,
commercial banks, trust companies, and other
nominees may also effect tenders by book-entry
transfer, including an Agent's Message in lieu
of the Letter of Transmittal. Holders of Old
Capital Securities registered in the name of a
broker, dealer, commercial bank, trust company,
or other nominee are urged to contact such
person promptly if they wish to tender Old
Capital Securities pursuant to the Exchange
Offer. See "The Exchange Offer -- Procedures for
Tendering Old Capital Securities." Letters of
Transmittal and certificates representing Old
Capital Securities should not be sent to the
Company or the Trust. Such documents should only
be sent to the Exchange Agent. Questions
regarding how to tender and requests for
information should be directed to the Exchange
Agent. See "The Exchange Offer -- Exchange
Agent."
Resales of New Capital
Securities................ The Company and the Trust are making the
Exchange Offer in reliance on the position of
the staff of the Division of Corporation Finance
of the Commission as set forth in certain
interpretive letters addressed to third parties
in other transactions. However, neither the
Company nor the Trust has sought its own
interpretive letter and there can be no
assurance that the staff of the Division of
Corporation Finance of the Commission would make
a similar determination with respect to the
Exchange Offer as it has in such interpretive
letters to third parties. Based on these
interpretations by the staff of the Division of
Corporation Finance, and subject to the two
immediately following sentences, the Company and
the Trust believe that New Capital Securities
issued pursuant to this Exchange Offer in
exchange for Old Capital Securities may be
offered for resale, resold, and otherwise
transferred by a holder thereof (other than a
holder who is a broker-dealer) without further
compliance with the registration and prospectus
delivery requirements of the Securities Act,
provided that such New Capital Securities are
acquired in the ordinary course of such holder's
business and that such holder is not
participating, and has no arrangement or
understanding with any person to participate, in
a distribution (within the meaning of the
Securities Act) of such New Capital Securities.
However, any holder of Old Capital Securities
who is an Affiliate or who intends to
participate in the Exchange Offer for the
purpose of distributing the New Capital
Securities, or any broker-dealer who purchased
the Old Capital Securities from the Trust to
resell pursuant to Rule 144A or any other
available exemption under the Securities Act,
(i) will not be able to rely on the
interpretations of the staff of the Division of
Corporation Finance of the Commission set forth
in the above-mentioned interpretive letters,
(ii) will not be permitted or entitled to tender
such Old Capital Securities in the Exchange
Offer, and (iii) must comply with the
registration and prospectus delivery
requirements of the Securities Act in connection
with any sale or other transfer of such Old
Capital Securities unless such sale is made
pursuant to an exemption from such requirements.
In addition, as described below, any
Participating Broker-Dealer must deliver a
prospectus meeting the requirements of the
Securities Act in connection with any resales of
such New Capital Securities.
Each holder of Old Capital Securities that
wishes to exchange Old Capital Securities for
New Capital Securities in the Exchange Offer
will be required to represent that (i) it is not
an Affiliate, (ii) any New Capital Securities to
be received by it are being acquired in the
ordinary course of its business, (iii) it has no
arrangement or understanding with any person to
participate in a distribution (within the
meaning of the Securities Act) of such New
Capital Securities, and (iv) if such holder is
not a broker-dealer, such holder is not engaged
in, and does not intend to engage in, a
distribution (within the meaning of the
Securities Act) of such New Capital Securities.
The Letter of Transmittal contains the foregoing
representations. Each Participating
Broker-Dealer will be deemed to have
acknowledged by execution of the Letter of
Transmittal or delivery of an Agent's Message
that it acquired the Old Capital
12
<PAGE> 16
Securities for its own account as the result of
market-making activities or other trading
activities and must agree that it will deliver a
prospectus meeting the requirements of the
Securities Act in connection with any resale of
such New Capital Securities. The Letter of
Transmittal states that by so acknowledging and
by delivering a prospectus, a Participating
Broker-Dealer will not be deemed to admit that
it is an "underwriter" within the meaning of the
Securities Act. Based on the position taken by
the staff of the Division of Corporation Finance
of the Commission in the interpretive letters
referred to above, the Company and the Trust
believe that Participating Broker-Dealers may
fulfill their prospectus delivery requirements
with respect to the New Capital Securities
received upon exchange of such Old Capital
Securities (other than Old Capital Securities
which represent an unsold allotment from the
original sale of the Old Capital Securities)
with a prospectus meeting the requirements of
the Securities Act, which may be the prospectus
prepared for an exchange offer so long as it
contains a description of the plan of
distribution with respect to the resale of such
New Capital Securities. Accordingly, this
Prospectus, as it may be amended or supplemented
from time to time, may be used by a
Participating Broker-Dealer in connection with
resales of New Capital Securities received in
exchange for Old Capital Securities where such
Old Capital Securities were acquired by such
Participating Broker-Dealer for its own account
as a result of market-making or other trading
activities. Subject to certain provisions set
forth in the Registration Rights Agreement and
to the limitations described below under "The
Exchange Offer -- Resale of New Capital
Securities," the Company and the Trust have
agreed that this Prospectus, as it may be
amended or supplemented from time to time, may
be used by a Participating Broker-Dealer in
connection with resales of such New Capital
Securities for a period ending 180 days after
the Expiration Date or, if earlier, when all
such New Capital Securities have been disposed
of by such Participating Broker-Dealer. See
"Plan of Distribution." Any person, including
any Participating Broker-Dealer, who is an
Affiliate may not rely on such interpretive
letters and must comply with the registration
and prospectus delivery requirements of the
Securities Act in connection with any resale
transaction. See "The Exchange Offer -- Resales
of New Capital Securities."
Exchange Agent............... The Exchange Agent is The Chase Manhattan Bank.
The address and telephone and facsimile numbers
of the Exchange Agent are set forth under "The
Exchange Offer -- Exchange Agent" and in the
Letter of Transmittal.
Use of Proceeds............. Neither the Company nor the Trust will receive
any proceeds from the issuance of the New
Capital Securities offered hereby. See "Use of
Proceeds."
Certain Tax and ERISA
Considerations............ Holders of Old Capital Securities should review
the information set forth under "Certain United
States Federal Income Tax Considerations" and
"ERISA Considerations" prior to tendering
Old Capital Securities in the Exchange Offer.
THE NEW SECURITIES
General....................... The Capital Securities represent undivided
beneficial ownership interests in the assets of
the Trust. The holders thereof will be entitled
to a preference in certain circumstances with
respect to Distributions and amounts payable on
redemption, liquidation, or otherwise over the
Common Securities. See "Description of New
Securities -- Description of Capital Securities
-- Subordination of Common Securities." The sole
assets of the Trust are the Subordinated
Debentures, and payments under the Subordinated
Debentures will be the sole revenue of the
Trust. The Subordinated Debentures are unsecured
subordinated debt securities issued under the
Indenture.
Securities Offered........... The Trust is offering up to $200,000,000
aggregate Liquidation Amount of its Capital
Securities which have been registered under the
Securities Act (Liquidation Amount $1,000 per
Capital Security). The New Capital Securities
will be issued, and the Old Capital Securities
were issued, under the Declaration. The New
Capital Securities and any Old Capital
Securities which remain outstanding after
consummation of the
13
<PAGE> 17
Exchange Offer will constitute a single series
of Capital Securities under the Declaration, and
accordingly, will vote together as a single
class for purposes of determining whether
holders of the requisite percentage in
outstanding Liquidation Amount thereof have
taken certain actions or exercised certain
rights under the Declaration. See "Description
of New Securities -- Description of Capital
Securities." The terms of the New Capital
Securities are identical in all material
respects to the terms of the Old Capital
Securities, except that the New Capital
Securities have been registered under the
Securities Act and therefore are not subject to
certain restrictions on transfer applicable to
the Old Capital Securities and will not provide
for any increase in the distribution rate
thereon. See "The Exchange Offer -- Purpose and
Effect of Exchange Offer," "Description of New
Securities," and "Description of Old
Securities."
Distributions................. Holders of the Capital Securities will be
entitled to receive cumulative Distributions at
a variable annual rate equal to LIBOR plus .70%
on the Liquidation Amount of $1,000 per Capital
Security, accruing from the date of original
issuance of the Old Capital Securities and
payable quarterly in arrears on the last day of
January, April, July, and October of each year
commencing on April 30, 1997, to the persons in
whose names the Capital Securities are
registered at the close of business on the
relevant record dates. See "Description of New
Securities -- Description of Capital
Securities." The final Distributions will be
payable on February 1, 2027, and will accrue
from the last distribution payment date prior to
such date up to and including January 31, 2027.
The distribution rate and the distribution and
other payment dates for the Capital Securities
will correspond to the interest rate and
interest and other payment dates on the
Subordinated Debentures. See "Description of New
Securities -- Description of Capital
Securities."
Holders of Old Capital Securities whose Old
Capital Securities are accepted for exchange
will not receive accumulated Distributions on
such Old Capital Securities for any period from
and after the last Distribution Date with
respect to such Old Capital Securities prior to
the original issue date of the New Capital
Securities and will be deemed to have waived the
right to receive any Distributions on such Old
Capital Securities accumulated from and after
such Distribution Date.
Subordinated Debentures...... The Subordinated Debentures mature on February
1, 2027. The Subordinated Debentures rank
subordinate and junior in right of payment to
all Indebtedness of the Company to the extent
described herein. In addition, the Company's
obligations under the Subordinated Debentures
are effectively subordinated to all existing and
future liabilities and obligations of its
subsidiaries. See "Risk Factors -- Ranking of
Subordinated Obligations Under the Guarantee and
the Subordinated Debentures" and "Description of
New Securities -- Description of Subordinated
Debentures -- Subordination."
Guarantee..................... The payment of Distributions out of moneys held
by the Trust and payments on liquidation of the
Trust or the redemption of Capital Securities
are guaranteed by the Company to the extent the
Trust has funds available therefor. If the
Company does not make principal or interest
payments on the Subordinated Debentures, the
Trust will not have sufficient funds to make
Distributions on the Capital Securities, in
which event the Guarantee shall not apply to
such Distributions until the Trust has
sufficient funds available therefor. The
Company's obligations under the Guarantee, taken
together with its obligations under the
Subordinated Debentures and the Indenture,
including its obligation to pay all costs,
expenses, and liabilities of the Trust (other
than with respect to the Capital Securities),
constitute a full and unconditional guarantee of
all of the Trust's obligations under the Capital
Securities. See "Description of New Securities
-- Description of Guarantee" and "Relationship
Among the Capital Securities, the Subordinated
Debentures, and the Guarantee." The obligations
of the Company under the Guarantee are
subordinate and junior in right of payment to
all Indebtedness of the Company to the extent
described herein. See "Risk Factors -- Ranking
of Subordinated Obligations Under the Guarantee
and the Subordinated Debentures" and
"Description of New Securities -- Description of
Guarantee."
14
<PAGE> 18
Right to Defer Interest.... The Company has the right to defer payment of
interest on the Subordinated Debentures by
extending the interest payment period on the
Subordinated Debentures, from time to time, for
up to 20 consecutive quarters. There could be
multiple Extension Periods of varying lengths
throughout the term of the Subordinated
Debentures. If interest payments on the
Subordinated Debentures are so deferred,
distributions on the Capital Securities will
also be deferred for an equivalent period and
the Company may not, and may not permit any
subsidiary of the Company to, (i) declare or pay
any dividends or distributions on, or redeem,
purchase, acquire, or make a liquidation payment
with respect to, the Company's capital stock, or
(ii) make any payment of principal, interest, or
premium, if any, on, or repay, repurchase, or
redeem any debt securities that rank pari passu
with or junior to the Subordinated Debentures or
make any guarantee payments with respect to any
guarantee by the Company of the debt securities
of any subsidiary of the Company if such
guarantee ranks pari passu with or junior to the
Subordinated Debentures (other than (a)
repurchases, redemptions, or other acquisitions
of shares of capital stock of the Company in
connection with any employment contract, benefit
plan, or other similar arrangement with or for
the benefit of any one or more employees,
officers, directors, or consultants, or in
connection with a dividend reinvestment or
stockholder stock purchase plan, (b) as a result
of an exchange or conversion of any class or
series of the Company's capital stock (or any
capital stock of a subsidiary of the Company)
for any other class or series of the Company's
capital stock or of any class or series of the
Company's indebtedness for any class or series
of the Company's capital stock, (c) the purchase
of fractional interests in shares of the
Company's capital stock pursuant to the
conversion or exchange provisions of such
capital stock or the security being converted or
exchanged, (d) any declaration of a dividend in
connection with any stockholders' rights plan,
or the issuance of rights, stock, or other
property under any stockholders' rights plan, or
the redemption or repurchase of rights pursuant
thereto, or (e) any dividend in the form of
stock, warrants, options, or other rights where
the dividend stock or the stock issuable upon
exercise of such warrants, options, or other
rights is the same stock as that on which the
dividend is being paid (or ranks pari passu with
or junior to such stock)). During an Extension
Period, interest on the Subordinated Debentures
will continue to accrue (and the amount of
Distributions to which holders of the Capital
Securities are entitled will accumulate) at a
variable annual rate equal to LIBOR plus .70%,
compounded quarterly. During an Extension
Period, holders of Capital Securities will be
required to include the interest (and the de
minimis original issue discount ("OID")) accrued
on their pro rata share of the Subordinated
Debentures in their gross income as OID even
though the cash payments attributable thereto
have not been made. See "Description of New
Securities -- Description of Subordinated
Debentures -- Option to Extend Interest Payment
Period" and "Certain United States Federal
Income Tax Consequences -- Interest Income and
Original Issue Discount."
The Company has no current plan to exercise its
right to defer payments of interest by extending
the interest payment period on the Subordinated
Debentures. However, should the Company elect to
exercise such right in the future, the market
price of the Capital Securities is likely to be
affected. See "Risk Factors -- Option to Extend
Interest Payment Period; Tax Consequences,"
"Description of New Securities -- Description of
Subordinated Debentures," and "Certain United
States Federal Income Tax Consequences --
Interest Income and Original Issue Discount."
Redemption................... The Subordinated Debentures are redeemable by
the Company in whole or in part on or after
February 1, 2007, or at any time, in whole but
not in part, upon the occurrence of a Special
Event, in either case subject to any necessary
prior approval of the Federal Reserve. If the
Subordinated Debentures are redeemed, the Trust
must redeem Trust Securities having an aggregate
Liquidation Amount equal to the aggregate
principal amount of the Subordinated Debentures
so redeemed. The Trust Securities will be
redeemed upon maturity of the Subordinated
Debentures. See "Description of New Securities
-- Description of Capital Securities --
Redemption -- Mandatory Redemption" and "--
Special Event Redemption or Distribution of
Subordinated Debentures."
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<PAGE> 19
See "Risk Factors -- Special Event Redemption;
Proposed Tax Law Changes Affecting Capital
Securities" for a discussion of certain
legislative proposals that, if adopted, could
give rise to a Tax Event (as defined herein),
which may permit the Corporation to cause a
redemption of the Capital Securities prior to
February 1, 2007.
No sinking fund will be established for the
benefit of the Capital Securities.
Liquidation of the Trust... Upon the occurrence and continuation of a
Special Event, the Company will have the right,
subject to any necessary prior approval of the
Federal Reserve, to dissolve the Trust and cause
the Subordinated Debentures to be distributed to
the holders of the Capital Securities and the
Common Securities in liquidation of the Trust.
See "Description of New Securities --
Description of Capital Securities -- Redemption
-- Special Event Redemption or Distribution of
Subordinated Debentures."
In the event of the liquidation of the Trust,
after satisfaction of the claims of creditors of
the Trust, if any, as provided by applicable
law, the holders of the Capital Securities will
be entitled to receive a Liquidation Amount of
$1,000 per Capital Security plus accumulated and
unpaid Distributions thereon to the date of
payment, which may be in the form of a
distribution of such amount in Subordinated
Debentures as described above. If such
Liquidation Distribution (as defined herein) can
be paid only in part because the Trust has
insufficient assets available to pay in full the
aggregate Liquidation Distribution, then the
amounts payable directly by the Trust on the
Capital Securities shall be paid on a pro rata
basis. The holder of the Common Securities will
be entitled to receive distributions upon any
such liquidation pro rata with the holders of
the Capital Securities, except that if an
Indenture Event of Default has occurred and is
continuing, the Capital Securities shall have a
priority over the Common Securities. See
"Description of New Securities -- Description of
Capital Securities -- Liquidation Distribution
Upon Dissolution."
Absence of Market for
New Capital Securities.. The New Capital Securities will be a new issue
of securities for which there currently is no
market. Morgan Stanley & Co. Incorporated,
Lehman Brothers Inc. and Salomon Brothers Inc,
the initial purchasers of the Old Capital
Securities (the "Initial Purchasers"), informed
the Company and the Trust in connection with the
offering of the Old Capital Securities that the
Initial Purchasers intended to make a market in
the Old Capital Securities; however, the Initial
Purchasers are not obligated to make a market in
the Old Capital Securities or the New Capital
Securities, and any such market-making activity
with respect to the Old Capital Securities or
the New Capital Securities may be discontinued
at any time without notice. Accordingly, no
assurance can be given that an active public or
other market will develop for the Old Capital
Securities or the New Capital Securities and no
representations can be made as to the liquidity
of or the trading market for the Old Capital
Securities or the New Capital Securities.
Listing/Applications.......... The Capital Securities have been listed on the
Luxembourg Stock Exchange.
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<PAGE> 20
RISK FACTORS
Holders of Old Capital Securities should carefully review the
information contained elsewhere in this Prospectus and should particularly
consider the following matters prior to tendering Old Capital Securities in the
Exchange Offer. Certain statements in this Prospectus and documents incorporated
herein by reference are forward-looking and are identified by the use of
forward-looking words or phrases such as "intended," "will be positioned,"
"expects," is or are "expected," "anticipates," and "anticipated." These
forward-looking statements are based on the Company's current expectations. To
the extent any of the information contained or incorporated by reference in this
Prospectus constitutes a "forward-looking statement" as defined in Section
21E(i)(1) of the Exchange Act, the risk factors set forth below are cautionary
statements identifying important factors that could cause actual results to
differ materially from those in the forward-looking statements.
RANKING OF SUBORDINATED OBLIGATIONS UNDER THE GUARANTEE AND THE SUBORDINATED
DEBENTURES
The obligations of the Company under the Guarantee issued by the
Company for the benefit of the holders of Capital Securities and under the
Subordinated Debentures are unsecured and rank subordinate and junior in right
of payment to all Indebtedness of the Company to the extent described herein. At
March 31, 1997, the Indebtedness of the Company aggregated approximately $369.3
million. Because the Company is a holding company, the right of the Company to
participate in any distributions of assets of any subsidiary upon such
subsidiary's liquidation or reorganization or otherwise (and thus the ability of
holders of the Capital Securities to benefit indirectly from such distribution),
is subject to the prior claims of creditors of that subsidiary, except to the
extent that the Company may itself be recognized as a creditor of that
subsidiary. There are various legal limitations on the extent to which certain
of the Company's subsidiaries may extend credit, pay dividends or otherwise
supply funds to, or engage in transactions with, the Company. Accordingly, the
Subordinated Debentures will effectively be subordinated to all existing and
future liabilities of the Company's subsidiaries, and holders of the
Subordinated Debentures should look only to the assets of the Company for
payments on the Subordinated Debentures. None of the Indenture, the Guarantee,
or the Declaration places any limitation on the amount of secured or unsecured
Indebtedness that may be incurred by the Company or on the amount of liabilities
and obligations of the Company's subsidiaries. See "Description of New
Securities -- Description of Guarantee -- Status of the Guarantee" and
"-- Description of Subordinated Debentures -- Subordination."
The ability of the Trust to pay amounts due on the Capital Securities
is solely dependent upon the Company making payments on the Subordinated
Debentures as and when required.
ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF CAPITAL SECURITIES
If a Trust Enforcement Event (as defined herein) occurs and is
continuing, then the holders of Capital Securities would rely on the enforcement
by the Property Trustee of its rights as a holder of the Subordinated Debentures
against the Company. The holders of a majority in Liquidation Amount of the
Capital Securities will have the right to direct the time, method, and place of
conducting any proceeding for any remedy available to the Property Trustee or to
direct the exercise of any trust or power conferred upon the Property Trustee
under the Declaration, including the right to direct the Property Trustee to
exercise the remedies available to it as a holder of the Subordinated
Debentures. The New Capital Securities and any Old Capital Securities which
remain outstanding after consummation of the Exchange Offer will constitute a
single series of Capital Securities under the Declaration, and accordingly, will
vote together as a single class for purposes of determining whether holders of
the requisite percentage in outstanding Liquidation Amount thereof have taken
certain actions or exercised certain rights under the Declaration. If the
Property Trustee fails to enforce its rights with respect to the Subordinated
Debentures held by the Trust, any record holder of Capital Securities may, to
the fullest extent permitted by law, institute legal proceedings directly
against the Company to enforce the Property Trustee's rights under such
Subordinated Debentures without first instituting any legal proceedings against
such Property Trustee or any other person or entity.
If the Company were to default on its obligation to pay amounts payable
under the Subordinated Debentures, the Trust would lack funds for the payment of
Distributions or amounts payable on redemption of the Capital Securities or
otherwise, and, in such event, holders of the Capital Securities would not be
able to rely upon the Guarantee for payment of such amounts. However, in the
event the Company failed to pay interest on or principal of the Subordinated
Debentures on the payment date on which such payment is due and payable, then a
holder of Capital Securities may institute a proceeding directly against the
Company under the Indenture for enforcement of payment to such holder of
17
<PAGE> 21
the interest on or principal of Subordinated Debentures having a principal
amount equal to the aggregate Liquidation Amount of the Capital Securities of
such holder (a "Direct Action"). In connection with such Direct Action, the
Company will be subrogated to the rights of such holder of Capital Securities
under the Declaration to the extent of any payment made by the Company to such
holder of Capital Securities in such Direct Action. Except as set forth herein,
holders of Capital Securities will not be able to exercise directly any other
remedy available to the holders of Subordinated Debentures or assert directly
any other rights in respect of the Subordinated Debentures. See "Description of
New Securities -- Description of Capital Securities -- Trust Enforcement
Events," "-- Description of Guarantee" and "-- Description of Subordinated
Debentures -- Indenture Events of Default."
OPTION TO EXTEND INTEREST PAYMENT PERIOD; TAX CONSEQUENCES
The Company has the right under the Indenture to defer the payment of
interest on the Subordinated Debentures at any time or from time to time for a
period not exceeding 20 consecutive quarters, provided that no Extension Period
may extend beyond the Stated Maturity of the Subordinated Debentures. As a
consequence of any such deferral, quarterly Distributions on the Capital
Securities by the Trust will be deferred during any such Extension Period but
would continue to accumulate at a variable annual rate equal to LIBOR plus .70%,
compounded quarterly during any such Extension Period. During any such Extension
Period, the Company may not, and may not permit any subsidiary of the Company
to, (i) declare or pay any dividends or distributions on, or redeem, purchase,
acquire, or make a liquidation payment with respect to, any of the Company's
capital stock or (ii) make any payment of principal, interest, or premium, if
any, on or repay, repurchase, or redeem any debt securities of the Company that
rank pari passu with or junior to the Subordinated Debentures or make any
guarantee payments with respect to any guarantee by the Company of the debt
securities of any subsidiary of the Company if such guarantee ranks pari passu
with or junior to the Subordinated Debentures (other than (a) repurchases,
redemptions, or other acquisitions of shares of capital stock of the Company in
connection with any employment contract, benefit plan, or other similar
arrangement with or for the benefit of any one or more employees, officers,
directors, or consultants, or in connection with a dividend reinvestment or
stockholder stock purchase plan, (b) as a result of an exchange or conversion of
any class or series of the Company's capital stock (or any capital stock of a
subsidiary of the Company) for any other class or series of the Company's
capital stock or of any class or series of the Company's indebtedness for any
class or series of the Company's capital stock, (c) the purchase of fractional
interests in shares of the Company's capital stock pursuant to the conversion or
exchange provisions of such capital stock, or the security being converted or
exchanged, (d) any declaration of a dividend in connection with any stockholders
rights plan, or the issuance of rights, stock, or other property under any
stockholders' rights plan, or the redemption or repurchase of rights pursuant
thereto, or (e) any dividend in the form of stock, warrants, options, or other
rights where the dividend stock or the stock issuable upon exercise of such
warrants, options, or other rights is the same stock as that on which the
dividend is being paid (or ranks pari passu with or junior to such stock)).
Prior to the termination of any such Extension Period, the Company may further
extend the Extension Period, provided that no Extension Period may exceed 20
consecutive quarters or extend beyond the Stated Maturity of the Subordinated
Debentures. Upon the termination of any Extension Period and the payment of all
amounts then due on any Interest Payment Date, the Company may elect to begin a
new Extension Period subject to the above requirements. See "Description of New
Securities -- Description of Capital Securities -- Distributions" and
"-- Description of Subordinated Debentures -- Option to Extend Interest
Payment Period."
Should the Company defer payment of interest on the Subordinated
Debentures, a holder of Capital Securities will be required to accrue income (in
the form of OID) (which will include both stated interest and the de minimis OID
on the Subordinated Debentures) for United States federal income tax purposes in
respect of its pro rata share of the Subordinated Debentures held by the Trust.
As a result, a holder of Capital Securities will be required to include such
interest income in gross income for United States federal income tax purposes in
advance of the receipt of cash attributable to such interest income, and will
not receive the cash related to such income from the Trust if the holder
disposes of the Capital Securities prior to the record date for the payment of
Distributions with respect to such Extension Period. See "Certain United States
Federal Income Tax Consequences -- Interest Income and Original Issue Discount"
and "-- Sales of Capital Securities."
The Company has no current intention of exercising its right to defer
payments of interest by extending the interest payment period on the
Subordinated Debentures. However, should the Company elect to exercise such
right in the future, the market price of the Capital Securities is likely to be
adversely affected. A holder that disposes of its Capital Securities during an
Extension Period, therefore, might not receive the same return on its investment
as a holder that continues to hold its Capital Securities. In addition, as a
result of the Company's right to defer interest payments, the market price of
the Capital Securities (which represent preferred undivided beneficial interests
in the Subordinated
18
<PAGE> 22
Debentures) may be more volatile than the market prices of other similar
securities where the issuer does not have such right to defer interest payments.
SPECIAL EVENT REDEMPTION; PROPOSED TAX LAW CHANGES
Upon the occurrence and continuation of a Special Event, the Company
has the right, subject to any necessary prior approval of the Federal Reserve,
to redeem the Subordinated Debentures in whole (but not in part) within 90 days
following the occurrence of such Special Event and thereby cause a mandatory
redemption of the Capital Securities and Common Securities. A "Special Event"
means a Tax Event, a Regulatory Capital Event, or an Investment Company Event
(each as defined herein).
Legislation was proposed by the United States Department of Treasury on
February 6, 1997, as part of President Clinton's Fiscal 1998 Budget Proposal
(the "Budget Proposal") that contains a provision which generally would deny an
interest deduction for interest paid or accrued on an instrument issued by a
corporation that (i) has a maximum term of more than 15 years and (ii) is not
shown as indebtedness on the separate balance sheet of the issuer or, where the
instrument is issued to a related party (other than a corporation), where the
holder or some other related party issues a related instrument that is not shown
as indebtedness on the consolidated balance sheet that includes the issuer and
the holder. As originally drafted, this provision was proposed to be effective
generally for debt instruments issued on or after the date of the first
Congressional committee action taken on the proposed legislation. If this
provision were to apply to the Subordinated Debentures, the Company would be
prohibited from deducting the interest on the Subordinated Debentures, which
would trigger a "Tax Event" (see below). On June 9, 1997, House Ways and Means
Committee Chairman Bill Archer released his draft proposed Revenue
Reconciliation Act of 1997 which deleted this particular provision. As of June
25, 1997, neither the House Ways and Means Committee nor the Senate Finance
Committee has included this provision in their approved versions of the Revenue
Reconciliation Act. The Joint Committee has yet to address the provision.
Even though the most recent Congressional action does not incorporate
the President's Proposal concerning the disallowance of interest deductions on
long-term debt obligations not treated as indebtedness on the issuer's balance
sheet, there can be no assurance as to the ultimate resolution of the pending
legislation on this issue. Thus, there can be no assurance that the proposed
legislation, future legislative proposals, or final legislation will not
adversely affect the ability of the Company to deduct interest on the
Subordinated Debentures or otherwise affect the tax treatment of the
transactions described herein. Moreover, such legislation could give rise to a
Tax Event, which would permit the Company to cause a redemption of the Capital
Securities, as described more fully herein under the caption "Description of New
Securities -- Description of Capital Securities -- Redemption -- Special Event
Redemption or Substitution of Subordinated Debentures."
LIQUIDATION DISTRIBUTION OF SUBORDINATED DEBENTURES
Upon the occurrence and continuation of a Special Event, the Company
will have the right, subject to any necessary prior approval of the Federal
Reserve, to dissolve the Trust and, after satisfaction of the claims of
creditors of the Trust, if any, as provided by applicable law, cause the
Subordinated Debentures to be distributed to the holders of the Capital
Securities and the Common Securities in liquidation of the Trust. In addition,
upon liquidation of the Trust and certain other events, after satisfaction of
the claims of creditors of the Trust, if any, as provided by applicable law, the
Subordinated Debentures may be distributed to such holders. Under current United
States federal income tax law and interpretations thereof and assuming, as
expected, the Trust is treated as a grantor trust for United States federal
income tax purposes, a distribution by the Trust of the Subordinated Debentures
pursuant to a liquidation of the Trust will not be a taxable event to the Trust
or to holders of the Capital Securities, and will result in a holder of the
Capital Securities receiving directly such holder's pro rata share of the
Subordinated Debentures (previously held indirectly through the Trust). If,
however, the liquidation of the Trust were to occur because the Trust is subject
to United States federal income tax with respect to income accrued or received
on the Subordinated Debentures as a result of the occurrence of a Tax Event or
otherwise, the distribution of Subordinated Debentures to holders of the Capital
Securities by the Trust could be a taxable event to the Trust and each such
holder, and holders of the Capital Securities may be required to recognize gain
or loss as if they had exchanged their Capital Securities for the Subordinated
Debentures they receive upon the liquidation of the Trust. See "Certain United
States Federal Income Tax Consequences -- Distribution of Subordinated
Debentures or Cash Upon Liquidation of the Trust."
There can be no assurance as to the market prices for Capital
Securities or Subordinated Debentures that may be distributed in exchange for
Capital Securities if a liquidation of the Trust occurs. Accordingly, the
Capital Securities or the Subordinated Debentures that a holder of Capital
Securities may receive on liquidation of the Trust may trade at a discount to
the price that the investor paid to purchase the Capital Securities. See
"Description of New Securities --
19
<PAGE> 23
Description of Capital Securities -- Redemption -- Special Event Redemption or
Distribution of Subordinated Debentures" and "-- Description of Subordinated
Debentures -- General."
LIMITED VOTING RIGHTS
Holders of Capital Securities generally will have limited voting rights
relating only to the modification of the Capital Securities and certain other
matters described herein. Holders of Capital Securities will not be entitled to
vote to appoint, remove, or replace any of the Declaration Trustees, which
voting rights are vested exclusively in the holder of the Common Securities,
unless a Declaration Event of Default shall have occurred and is continuing. The
Declaration Trustees and the Company may amend the Declaration without the
consent of holders of Capital Securities to ensure that the Trust will be
classified as a grantor trust for United States federal income tax purposes even
if such action adversely affects the interests of such holders. See "Description
of New Securities -- Description of Capital Securities -- Voting Rights;
Amendment of the Declaration."
CONSEQUENCES OF FAILURE TO EXCHANGE OLD CAPITAL SECURITIES
The Old Capital Securities have not been registered under the
Securities Act or any state securities laws and therefore may not be offered,
sold, or otherwise transferred in the United States except in compliance with
the registration requirements of the Securities Act and any other applicable
securities laws, or pursuant to an exemption therefrom or in a transaction not
subject thereto, and in each case in compliance with certain other conditions
and restrictions. Old Capital Securities which remain outstanding after
consummation of the Exchange Offer will continue to bear a legend reflecting
such restrictions on transfer. In addition, upon consummation of the Exchange
Offer, holders of Old Capital Securities which remain outstanding will not be
entitled to any rights to have such Old Capital Securities registered under the
Securities Act or to any similar rights under the Registration Rights Agreement
(subject to certain limited exceptions). The Company and the Trust do not intend
to register under the Securities Act any Old Capital Securities which remain
outstanding after consummation of the Exchange Offer (subject to such limited
exceptions, if applicable).
To the extent that Old Capital Securities are tendered and accepted in
the Exchange Offer, a holder's ability to sell untendered Old Capital Securities
could be adversely affected. In addition, although the Old Capital Securities
have been designated for trading in the Private Offerings, Resale, and Trading
through Automatic Linkages ("PORTAL") market, to the extent that Old Capital
Securities are tendered and accepted in connection with the Exchange Offer, any
trading market for Old Capital Securities which remain outstanding after the
Exchange Offer could be adversely affected.
The New Capital Securities and any Old Capital Securities which remain
outstanding after consummation of the Exchange Offer will constitute a single
series of Capital Securities under the Declaration and, accordingly, will vote
together as a single class for purposes of determining whether holders of the
requisite percentage in outstanding
20
<PAGE> 24
Liquidation Amount thereof have taken certain actions or exercised certain
rights under the Declaration. See "Description of New Securities -- Description
of Capital Securities -- General."
The Old Capital Securities provide that, if a Registration Default (as
defined herein) occurs, the Distribution rate borne by the Old Capital
Securities will increase by 0.25% per annum per $1,000 Liquidation Amount of Old
Capital Securities, commencing upon the occurrence of such Registration Default
until such Registration Default is cured. See "Description of Old Capital
Securities." Following consummation of the Exchange Offer, the Old Capital
Securities will not be entitled to any increase in the distribution rate
thereon. The New Capital Securities will not be entitled to any such increase in
the distribution rate thereon.
ABSENCE OF PUBLIC MARKET
The Old Capital Securities have not been registered under the
Securities Act and will be subject to restrictions on transferability to the
extent that they are not exchanged for the New Capital Securities. Although the
New Capital Securities will generally be permitted to be resold or otherwise
transferred by the holders (who are not Affiliates) without compliance with the
registration requirements under the Securities Act, they will constitute a new
issue of securities with no established trading market. The Company and the
Trust were advised by the Initial Purchasers in connection with the offering of
the Old Capital Securities that the Initial Purchasers intended to make a market
in the Old Capital Securities. However, the Initial Purchasers are not obligated
to make a market in the Old Capital Securities or the New Capital Securities and
any such market-making activity with respect to the Old Capital Securities or
the New Capital Securities may be discontinued at any time without notice. In
addition, such market-making activity will be subject to the limits imposed by
the Securities Act and the Exchange Act and may be limited during the Exchange
Offer. Accordingly, no assurance can be given that an active public or other
market will develop for the New Capital Securities or the Old Capital Securities
or as to the liquidity of or the trading market for the New Capital Securities
or the Old Capital Securities. If an active public market does not develop, the
market price and liquidity of the New Capital Securities may be adversely
affected.
If a public trading market develops for the New Capital Securities,
future trading prices of such securities will depend on many factors, including,
among other things, prevailing interest rates, results of operations, and the
market for similar securities. Depending on prevailing interest rates, the
market for similar securities, and other factors, including the financial
condition of the Company, the New Capital Securities may trade at a discount.
Notwithstanding the registration of the New Capital Securities in the
Exchange Offer, holders who are Affiliates may publicly offer for sale or resell
the New Capital Securities only in compliance with the provisions of Rule 144
under the Securities Act.
Each Participating Broker-Dealer that receives New Capital Securities
for its own account must acknowledge that it will deliver a prospectus in
connection with any resale of such New Capital Securities. See "Plan of
Distribution."
EXCHANGE OFFER PROCEDURES
Issuance of the New Capital Securities in exchange for Old Capital
Securities pursuant to the Exchange Offer will be made only after a timely
receipt by the Exchange Agent of such Old Capital Securities, a properly
completed and duly executed Letter of Transmittal or Agent's Message in lieu
thereof, and all other required documents. Therefore, holders of the Old Capital
Securities desiring to tender such Old Capital Securities in exchange for New
Capital Securities should allow sufficient time to ensure timely delivery. None
of the Company, the Trust, or the Exchange Agent are under any duty to give
notification of defects or irregularities with respect to the tenders of Old
Capital Securities for exchange.
CONSEQUENCES OF HIGHLY LEVERAGED TRANSACTION
The Indenture does not contain any provisions that afford holders of
the Subordinated Debentures protection in the event of a highly leveraged
transaction, including a change of control, or other similar transactions
involving the Company that may adversely affect such holders. See "Description
of New Securities -- Description of Subordinated Debentures."
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<PAGE> 25
THE TRUST
The Trust is a statutory business trust created under the Delaware
Business Trust Act, as amended (the "Trust Act"), pursuant to the Declaration
and the filing of a certificate of trust with the Secretary of State of the
State of Delaware. The Company acquired the Common Securities in an aggregate
Liquidation Amount equal to $6,186,000, which is 3% of the total capital of the
Trust. The Trust used all the proceeds derived from the issuance of the Capital
Securities and the Common Securities to purchase the Subordinated Debentures
and, accordingly, the assets of the Trust consist solely of the Subordinated
Debentures. The Trust exists for the exclusive purpose of (i) issuing the Trust
Securities representing undivided beneficial ownership interests in the assets
of the Trust, (ii) investing the gross proceeds of the Trust Securities in the
Subordinated Debentures, and (iii) engaging in only those other activities
necessary or incidental thereto. The Declaration does not limit the aggregate
liquidation amount of Trust Securities that may be issued thereunder, provided
that prior to issuing any additional Trust Securities, the Declaration Trustees
shall have received an opinion of counsel to the effect that the issuance of
such Trust's Securities will not affect the Trust status as a grantor trust for
United States federal income tax purposes.
The Trust's business and affairs are conducted by the Declaration
Trustees, consisting of three Regular Trustees, who are employees or officers of
or who are affiliated with the Company; The Chase Manhattan Bank, as Property
Trustee; and The Chase Manhattan Bank Delaware, which maintains its principal
place of business in the State of Delaware, as Delaware Trustee. The Chase
Manhattan Bank also acts as the Guarantee Trustee and the Indenture Trustee.
The Property Trustee holds title to the Subordinated Debentures for the
benefit of the holders of the Trust Securities, and the Property Trustee has the
power to exercise all rights, powers, and privileges with respect to the
Subordinated Debentures under the Indenture pursuant to which the Subordinated
Debentures are issued, as the holder of such Subordinated Debentures. In
addition, the Property Trustee maintains exclusive control of a segregated
non-interest bearing bank account (the "Property Account") to hold all payments
made in respect of the Subordinated Debentures for the benefit of the holders of
the Trust Securities. The Guarantee Trustee holds the Guarantee for the benefit
of the holders of the Capital Securities. The Company, as the holder of all the
Common Securities, has the right to appoint, remove, or replace any of the
Declaration Trustees and to increase or decrease the number of Declaration
Trustees, provided there must always be a Delaware Trustee, a Property Trustee,
and a Regular Trustee.
Under the Indenture, the Company, as borrower, has agreed to pay all
fees and expenses related to the organization and operations of the Trust
(including any taxes, duties, assessments, or governmental charges of whatever
nature (other than withholding taxes) imposed by the United States or any other
domestic taxing authority upon the Trust) and be responsible for all debts and
obligations of the Trust (other than with respect to the Capital Securities).
See "Description of New Securities -- Description of Capital Securities --
Expenses and Taxes" and "-- Description of Subordinated Debentures -- Certain
Covenants of the Company."
For so long as the Capital Securities remain outstanding, the Company
has covenanted (i) to maintain directly or indirectly 100% ownership of the
Common Securities, (ii) to cause the Trust to remain a statutory business trust
and not to voluntarily dissolve, wind-up, liquidate, or be terminated, except as
permitted by the Declaration, (iii) to use its commercially reasonable efforts
to ensure that the Trust will not be an "investment company" for purposes of the
Investment Company Act of 1940, as amended, and (iv) to take no action that
would be reasonably likely to cause the Trust to be classified as an association
or a publicly traded partnership taxable as a corporation for United States
federal income tax purposes.
The Declaration and the Guarantee incorporate by reference the terms of
the Trust Indenture Act. The rights of the holders of the Capital Securities,
including economic rights, rights to information, and voting rights, are set
forth in the Declaration and the Trust Indenture Act. See "Description of New
Securities -- Description of Capital Securities."
The location of the principal executive office of the Trust is
Huntington Center, 41 South High Street, Columbus, Ohio 43287.
22
<PAGE> 26
THE COMPANY
The Company, a multi-state bank holding company incorporated under the
laws of the State of Maryland in 1966, is headquartered in Columbus, Ohio. At
March 31, 1997, the Company had total assets of approximately $21.6 billion and
total deposits of approximately $13.9 billion. The Company, through its
affiliates, conducts a full service commercial and consumer banking business,
engages in mortgage banking, lease financing, trust services, discount brokerage
services, underwriting credit life and disability insurance, and issuing
commercial paper guaranteed by the Company, and provides other financial
products and services. At March 31, 1997, the Company's affiliates had 202
banking offices in Ohio and Northern Kentucky, 43 banking offices in West
Virginia, 43 banking offices in Michigan, 43 banking offices in Florida, 24
banking offices in Indiana, and one foreign office in the Cayman Islands. In
addition, the Company's mortgage company affiliate has loan origination offices
throughout the Midwest and East Coast. The principal executive offices of the
Company are located at Huntington Center, 41 South High Street, Columbus, Ohio
43287 (telephone number 614-480-8300).
Effective as of June 30, 1997, all but one of the Company's banking
subsidiaries were merged into its wholly owned principal banking subsidiary, The
Huntington National Bank. In February 1997, the Company completed the
acquisition of Citi-Bancshares, Inc., a $548 million bank holding company
headquartered in Leesburg, Florida. On May 5, 1997, the Company entered into an
agreement to acquire First Michigan Bank Corporation, a bank holding company
located in Holland, Michigan, with assets and deposits of $3.6 billion and $3.0
billion, respectively, as of March 31, 1997. On May 22, 1997, the Company
entered into an agreement to acquire The Bank of Winter Park, a Florida
state-chartered bank located in Winter Park, Florida, with assets and deposits
of $90 million and $82.5 million, respectively, as of March 31, 1997. Although
the Company has no other acquisitions pending, the Company continues to explore
other opportunities to acquire banking and non-banking companies, both
interstate and intrastate.
SELECTED FINANCIAL DATA OF THE COMPANY
The following selected financial data of the Company for the five years
ended December 31, 1996, have been derived from the Company's audited
consolidated financial statements. The selected financial data for the three
months ended March 31, 1997 and 1996, have been derived from unaudited
consolidated financial statements and reflect all adjustments (consisting of
normal recurring accruals) that, in the opinion of management, are necessary for
a fair presentation of such data. Operating results for the nine months ended
March 31, 1997, are not necessarily indicative of results for the entire year.
This data should be read in conjunction with the consolidated financial
statements, related notes, and other financial information of the Company
incorporated by reference herein.
BALANCE SHEET DATA (IN THOUSANDS)
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
------------------------- -------------------------------------------------------------------
1997 1996 1996 1995 1994 1993 1992
----------- ----------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Total assets .................. $21,603,478 $20,137,982 $20,851,513 $20,254,598 $17,770,640 $17,618,707 $16,246,526
Securities available for sale.. 4,897,160 4,954,577 4,743,933 4,721,144 3,304,493 3,840,064 399,221
Investment securities ......... 59,662 74,213 60,444 67,604 475,692 359,345 3,931,907
Loans ......................... 14,869,139 13,369,308 14,260,747 13,261,667 12,064,436 10,953,928 9,514,516
Allowance for loan losses ..... 208,763 197,375 199,058 194,456 200,492 211,835 153,654
Deposits ...................... 13,940,274 13,006,213 13,385,891 12,636,582 11,965,067 12,044,690 11,747,942
Long-term debt ................ 1,909,869 1,985,806 1,556,326 2,103,024 1,214,052 762,310 478,872
Common stock .................. $ 1,264,664 $1,056,209 $ 1,264,664 $ 1,056,209 $ 912,318 $ 902,107 $ 634,763
Treasury stock ................ (154,822) (193,213) (204,634) (180,632) (16,577) (15,290) (6,069)
Capital surplus ............... 253,319 241,079 237,348 235,802 215,084 216,168 212,603
Net unrealized (losses) gains
on securities available for
sale ........................ (60,924) (3,954) (14,569) 40,972 (63,289) -- --
Retained earnings ............. 266,839 402,389 228,705 366,514 364,284 221,652 288,372
----------- ---------- ---------- ---------- ---------- ---------- ----------
Total shareholders' equity .... $1,569,076 $1,502,510 $1,511,514 $1,518,865 $1,411,820 $1,324,637 $1,129,669
========== ========== ========== ========== ========== ========== ==========
</TABLE>
23
<PAGE> 27
INCOME STATEMENT DATA (IN THOUSANDS)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31, YEARS ENDED DECEMBER 31,
-------------------- ------------------------------------------------------------------
1997 1996 1996 1995 1994 1993 1992
-------- -------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Interest income ............. $405,184 $374,296 $1,510,464 $1,461,896 $1,219,721 $1,236,311 $1,202,286
Interest expense ............ 193,664 189,578 751,640 737,333 463,671 440,111 504,846
-------- -------- ---------- ---------- ---------- ---------- ----------
Net interest income ...... 211,520 184,718 758,824 724,563 756,050 796,200 697,440
Provision for loan losses ... 18,892 11,823 65,050 28,721 15,284 79,294 81,562
Non-interest income ......... 63,824 61,072 255,290 233,953 211,271 219,865 184,503
Securities gains ............ 1,977 7,090 17,703 9,056 2,594 27,189 36,332
Non-interest expenses ....... 155,315 143,496 567,946 560,403 588,157 600,169 603,278
-------- -------- ---------- ---------- ---------- ---------- ----------
Income before income
taxes .................. 103,114 97,561 398,821 378,448 366,474 363,791 233,435
Provision for income taxes... 36,664 34,736 136,720 133,959 123,881 126,879 72,389
-------- -------- ---------- ---------- ---------- ---------- ----------
Net income ............... $ 66,450 $ 62,825 $ 262,101 $ 244,489 $ 242,593 $ 236,912 $ 161,046
======== ======== ========== ========== ========== ========== ==========
Per Common Share:
Net income ............... $0.42 $0.38 $1.63 $1.47 $1.47 $1.45 $1.00
Cash dividends declared .. $0.18 $0.16 $0.68 $0.62 $0.56 $0.46 $0.40
</TABLE>
24
<PAGE> 28
RATIO OF EARNINGS TO FIXED CHARGES
The Company's consolidated ratios of earnings to fixed charges for each
of the periods indicated are set forth below (unaudited):
<TABLE>
<CAPTION>
THREE
MONTHS
ENDED YEARS ENDED DECEMBER 31,
MARCH 31, --------------------------------------------------------------------------
1997 1996 1995 1994 1993 1992
--------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C>
Earnings to Fixed Charges:
Excluding Interest on Deposits..... 2.30 2.33 2.18 3.07 3.80 3.29
Including Interest on Deposits..... 1.53 1.52 1.51 1.78 1.81 1.46
</TABLE>
For purposes of computing the ratios of earnings to fixed charges,
earnings represent net income plus applicable income taxes and fixed charges.
Fixed charges, excluding interest on deposits, represent interest expense
(except interest on deposits), and one-third of rental expense (which is deemed
representative of the interest factor). Fixed charges, including interest on
deposits, represent the foregoing items plus interest on deposits.
CAPITALIZATION
The following table sets forth the consolidated capitalization of the
Company and its subsidiaries as of March 31, 1997, and as adjusted to give
effect to the consummation of the offering of the Old Capital Securities. There
has been no material change in the capitalization of the Company since March 31,
1997. The following data should be read in conjunction with the consolidated
financial statements and notes thereto of the Company and its subsidiaries
incorporated herein by reference. See "Incorporation of Certain Documents by
Reference." Also show below are certain consolidated regulatory capital ratios
of the Company and its subsidiaries at March 31, 1997. The issuance of the New
Capital Securities in the Exchange Offer will have no effect on the
capitalization of the Company.
<TABLE>
<CAPTION>
MARCH 31,
1997
----------
ACTUAL
----------
(DOLLARS IN
THOUSANDS)
<S> <C>
Long-term debt:
Direct obligations of Company .............................................. $ 329,281
Obligations of Company subsidiaries ........................................ 1,380,588
Preferred Stock Issued by Subsidiaries--the Capital Securities (a) ......... 200,000
----------
Total long-term debt .................................................... 1,909,869
----------
Shareholders' equity:
Preferred stock ............................................................ --
Common stock ............................................................... 1,264,664
Treasury stock ............................................................. (154,822)
Capital surplus ............................................................ 253,319
Net unrealized losses on securities available for sale ..................... (60,924)
Retained earnings .......................................................... 266,839
----------
Total shareholders' equity .............................................. 1,569,076
----------
Total capitalization .................................................... $3,478,945
==========
Capital ratios:
Tier 1 capital to risk-adjusted assets ..................................... 8.92%
Total capital to risk-adjusted assets ...................................... 12.34%
Tier 1 Leverage ............................................................ 7.60%
</TABLE>
- - -------------------
(a) Reflects the Capital Securities. The Trust holds the Subordinated
Debentures as its sole asset. The Company owns all of the Common
Securities of the Trust.
25
<PAGE> 29
USE OF PROCEEDS
Neither the Company nor the Trust will receive any proceeds from the
issuance of the New Capital Securities offered hereby. The Old Capital
Securities surrendered in exchange for the New Capital Securities will be
retired and canceled.
All of the net proceeds from the sale of the Old Capital Securities,
which totaled approximately $197,246,000, were invested by the Trust in the Old
Subordinated Debentures. The net proceeds from the sale of the Old Subordinated
Debentures were or will be used by the Company for general corporate purposes,
including but not limited to the repayment of existing indebtedness, the
repurchase of the Company's stock, investments in, or extensions of credit to,
the Company's subsidiaries, the financing of possible acquisitions, and general
working capital. Although the Company does not intend to use the proceeds of the
Old Capital Securities for any pending acquisition, the Company continues to
explore opportunities to acquire banking and non-banking companies, both
interstate and intrastate. The precise amounts and timing of the application of
proceeds depend upon the funding requirements of the Company and its
subsidiaries and the availability of other funds. The Company may engage in
other financings in the future.
ACCOUNTING TREATMENT
For financial reporting purposes, the Trust will be treated as a
subsidiary of the Company and, accordingly, the accounts of the Trust will be
included in the consolidated financial statements of the Company. The Capital
Securities will be presented in the consolidated balance sheet of the Company as
a component of long term debt. The Company will record Distributions payable on
the Capital Securities as interest expense in its consolidated statement of
income.
THE EXCHANGE OFFER
PURPOSE AND EFFECT OF EXCHANGE OFFER
In connection with the sale of the Old Capital Securities, the Company
and the Trust entered into the Registration Rights Agreement with the Initial
Purchasers, pursuant to which the Company and the Trust agreed to file and to
use their best efforts to cause to be declared effective by the Commission a
registration statement with respect to the exchange of the Old Capital
Securities for the New Capital Securities with terms identical in all material
respects to the terms of the Old Capital Securities, except that the New Capital
Securities (i) have been registered under the Securities Act and therefore will
not be subject to certain restrictions on transfer applicable to the Old Capital
Securities, and (ii) will not provide for any increase in the distribution rate
thereon. In that regard, the Old Capital Securities provide, among other things,
that, if the Exchange Offer is not consummated by _________________, 1997 (which
is the date that is 30 business days after the date on which the Registration
Statement was declared effective by the Commission), or if the Registration
Statement is filed and declared effective but thereafter ceases to be effective
or fails to be usable for its intended purpose without being succeeded within
five business days by a post-effective amendment to such Registration Statement
that cures such failure and that is itself immediately declared effective (a
"Registration Default"), the distribution rate borne by the Old Capital
Securities will increase by 0.25% per annum per $1,000 Liquidation Amount of Old
Capital Securities commencing upon the occurrence of such Registration Default
until such Registration Default is cured. Upon consummation of the Exchange
Offer, holders of Old Capital Securities will not be entitled to any increase in
the distribution rate thereon or any further registration rights under the
Registration Rights Agreement,
26
<PAGE> 30
except under limited circumstances. See "Risk Factors -- Consequences of a
Failure to Exchange Old Capital Securities" and "Description of Old Securities."
A copy of the Registration Rights Agreement has been filed as an exhibit to the
Registration Statement of which this Prospectus is a part.
The Exchange Offer is not being made to, nor will the Trust or the
Company accept tenders for exchange from, holders of Old Capital Securities in
any jurisdiction in which the Exchange Offer or the acceptance thereof would not
be in compliance with the securities or blue sky laws of such jurisdiction.
Unless the context requires otherwise, the term "holder" with respect
to the Exchange Offer means any person in whose name the Old Capital Securities
are registered on the books of the Trust or any other person who has obtained a
properly completed bond power from the registered holder, or any person whose
Old Capital Securities are held of record by DTC who desires to deliver such
Old Capital Securities by book-entry transfer at DTC.
Pursuant to the Exchange Offer, the Company will exchange as soon as
practicable after the date hereof, the Old Guarantee for the New Guarantee and
all of the Old Subordinated Debentures, of which $206,186,000 aggregate
principal amount is outstanding, for a like aggregate principal amount of the
New Subordinated Debentures. The New Guarantee and $200,000,000 of the New
Subordinated Debentures have been registered under the Securities Act.
TERMS OF EXCHANGE
The Trust hereby offers, upon the terms and subject to the conditions
set forth in this Prospectus and in the accompanying Letter of Transmittal, to
exchange up to $200,000,000 aggregate Liquidation Amount of New Capital
Securities for a like aggregate Liquidation Amount of Old Capital Securities
properly tendered on or prior to the Expiration Date and not properly withdrawn
in accordance with the procedures described below. The Trust will issue,
promptly after the Expiration Date, an aggregate Liquidation Amount of up to
$200,000,000 of New Capital Securities in exchange for a like aggregate
Liquidation Amount of outstanding Old Capital Securities tendered and accepted
in connection with the Exchange Offer.
The Exchange Offer is not conditioned upon any minimum Liquidation
Amount of Old Capital Securities being tendered. As of the date of this
Prospectus, $200,000,000 aggregate Liquidation Amount of the Old Capital
Securities is outstanding.
Holders of Old Capital Securities do not have any appraisal or
dissenters' rights in connection with the Exchange Offer. Old Capital Securities
which are not tendered for or are tendered but not accepted in connection with
the Exchange Offer will remain outstanding and be entitled to the benefits of
the Declaration, but will not be entitled to any further registration rights
under the Registration Rights Agreement, except under limited circumstances. See
"Risk Factors -- Consequences of a Failure to Exchange Old Capital Securities"
and "Description of Old Securities."
If any tendered Old Capital Securities are not accepted for exchange
because of an invalid tender, the occurrence of certain other events set forth
herein or otherwise, certificates for any such unaccepted Old Capital Securities
will be returned, without expense, to the tendering holder thereof promptly
after the Expiration Date.
Holders who tender Old Capital Securities in connection with the
Exchange Offer will not be required to pay brokerage commissions or fees or,
subject to the instructions in the Letter of Transmittal, transfer taxes with
respect to the exchange of Old Capital Securities in connection with the
Exchange Offer. The Company will pay all charges and expenses, other than
certain applicable taxes described below, in connection with the Exchange Offer.
See " -- Fees and Expenses."
NEITHER THE BOARD OF DIRECTORS OF THE COMPANY NOR ANY DECLARATION
TRUSTEE MAKES ANY RECOMMENDATION TO HOLDERS OF OLD CAPITAL SECURITIES AS TO
WHETHER TO TENDER OR REFRAIN FROM TENDERING ALL OR ANY PORTION OF THEIR OLD
CAPITAL SECURITIES PURSUANT TO THE EXCHANGE OFFER. IN ADDITION, NO ONE HAS BEEN
AUTHORIZED TO MAKE ANY SUCH RECOMMENDATION. HOLDERS OF OLD CAPITAL SECURITIES
MUST MAKE THEIR OWN DECISION WHETHER TO TENDER PURSUANT TO THE EXCHANGE OFFER
AND, IF SO, THE AGGREGATE AMOUNT OF OLD CAPITAL SECURITIES TO TENDER AFTER
READING THIS PROSPECTUS AND THE LETTER OF TRANSMITTAL AND CONSULTING WITH THEIR
ADVISERS, IF ANY, BASED ON THEIR OWN FINANCIAL POSITION AND REQUIREMENTS.
27
<PAGE> 31
EXPIRATION DATE; EXTENSIONS; AMENDMENTS
The Exchange Offer will expire at on the Expiration Date which will
occur at 5:00 p.m., New York City time, on ______________ , 1997, unless the
Exchange Offer is extended by the Company and the Trust (in which case the term
Expiration Date shall mean the latest date and time to which the Exchange
Offer is extended).
The Company and the Trust expressly reserve the right in their sole
discretion, subject to applicable law, at any time and from time to time, (i) to
delay the acceptance of the Old Capital Securities for exchange, (ii) to
terminate the Exchange Offer (whether or not any Old Capital Securities have
theretofore been accepted for exchange) if the Company and the Trust determine,
in their sole discretion, that any of the events or conditions referred to under
" -- Conditions to the Exchange Offer" have occurred or exist or have not been
satisfied, (iii) to extend the Expiration Date of the Exchange Offer and retain
all Old Capital Securities tendered pursuant to the Exchange Offer, subject,
however, to the right of holders of Old Capital Securities to withdraw their
tendered Old Capital Securities as described under " -- Withdrawal Rights," and
(iv) to waive any condition or otherwise amend the terms of the Exchange Offer
in any respect. If the Exchange Offer is amended in a manner determined by the
Company and the Trust to constitute a material change, or if the Company and the
Trust waive a material condition of the Exchange Offer, the Company and the
Trust will promptly disclose such amendment by means of an amended or
supplemented Prospectus that will be distributed to the registered holders of
the Old Capital Securities, and the Company and the Trust will extend the
Exchange Offer to the extent required by Rule 14e-1 under the Exchange Act.
Any such delay in acceptance, extension, termination, or amendment will
be followed promptly by oral or written notice thereof to the Exchange Agent and
by making a public announcement thereof, and such announcement in the case of an
extension will be made no later than 9:00 a.m., New York City time, on the next
business day after the previously scheduled Expiration Date. Without limiting
the manner in which the Company and the Trust may choose to make any public
announcement and subject to applicable law, the Company and the Trust shall have
no obligation to publish, advertise, or otherwise communicate any such public
announcement other than by issuing a release to an appropriate news agency.
ACCEPTANCE FOR EXCHANGE AND ISSUANCE OF NEW CAPITAL SECURITIES
Upon the terms and subject to the conditions of the Exchange Offer, the
Trust will exchange, and will issue to the Exchange Agent, New Capital
Securities for Old Capital Securities validly tendered and not withdrawn
(pursuant to the withdrawal rights described under " -- Withdrawal Rights")
promptly after the Expiration Date.
In all cases, delivery of New Capital Securities in exchange for Old
Capital Securities tendered and accepted for exchange pursuant to the Exchange
Offer will be made only after timely receipt by the Exchange Agent of (i) Old
Capital Securities or a book-entry confirmation of a book-entry transfer of Old
Capital Securities into the Exchange Agent's account at DTC, including an
Agent's Message if the tendering holder has not delivered a Letter of
Transmittal, (ii) the Letter of Transmittal (or facsimile thereof), properly
completed and duly executed, with any required signature guarantees or (in the
case of a book-entry transfer) an Agent's Message in lieu of the Letter of
Transmittal, and (iii) any other documents required by the Letter of
Transmittal.
The term "book-entry confirmation" means a timely confirmation of a
book-entry transfer of Old Capital Securities into the Exchange Agent's account
at DTC. The term "Agent's Message" means a message, transmitted by DTC to and
received by the Exchange Agent and forming a part of a book-entry confirmation,
which states that DTC has received an express acknowledgment from the tendering
participant, which acknowledgment states that such participant has received and
agrees to be bound by the Letter of Transmittal and that the Trust and the
Company may enforce such Letter of Transmittal against such participant.
Subject to the terms and conditions of the Exchange Offer, the Company
and the Trust will be deemed to have accepted for exchange, and thereby
exchanged, Old Capital Securities validly tendered and not withdrawn as, if, and
when the Trust gives oral or written notice to the Exchange Agent of the
Company's and the Trust's acceptance of such Old Capital Securities for exchange
pursuant to the Exchange Offer. The Exchange Agent will act as agent for the
Company and the Trust for the purpose of receiving tenders of Old Capital
Securities, Letters of Transmittal, and related documents, and as agent for
tendering holders for the purpose of receiving Old Capital Securities, Letters
of Transmittal, and related documents and transmitting New Capital Securities to
validly tendering holders. Such exchange will be made promptly after the
Expiration Date. If for any reason whatsoever, acceptance for exchange or the
exchange of any Old Capital Securities tendered pursuant to the Exchange Offer
is delayed (whether before or after the Company's
28
<PAGE> 32
and the Trust's acceptance for exchange of Old Capital Securities) or the
Company and the Trust extend the Exchange Offer or are unable to accept for
exchange or exchange Old Capital Securities tendered pursuant to the Exchange
Offer, then, without prejudice to the Company's and the Trust's rights set forth
herein, the Exchange Agent may, nevertheless, on behalf of the Company and the
Trust and subject to Rule 14e-1(c) under the Exchange Act, retain tendered Old
Capital Securities and such Old Capital Securities may not be withdrawn except
to the extent tendering holders are entitled to withdrawal rights as described
under " -- Withdrawal Rights."
Pursuant to the Letter of Transmittal or Agent's Message in lieu
thereof, a holder of Old Capital Securities will warrant and agree in the Letter
of Transmittal that it has full power and authority to tender, exchange, sell,
assign, and transfer Old Capital Securities, that the Trust will acquire good,
marketable, and unencumbered title to the tendered Old Capital Securities, free
and clear of all liens, restrictions, charges, and encumbrances, and the Old
Capital Securities tendered for exchange are not subject to any adverse claims
or proxies. The holder also will warrant and agree that it will, upon request,
execute and deliver any additional documents deemed by the Company, the Trust,
or the Exchange Agent to be necessary or desirable to complete the exchange,
sale, assignment, and transfer of the Old Capital Securities tendered pursuant
to the Exchange Offer.
PROCEDURES FOR TENDERING OLD CAPITAL SECURITIES
VALID TENDER. Except as set forth below, in order for Old Capital
Securities to be validly tendered pursuant to the Exchange Offer, a properly
completed and duly executed Letter of Transmittal (or facsimile thereof), with
any required signature guarantees, or (in the case of a book-entry tender) an
Agent's Message in lieu of the Letter of Transmittal, and any other required
documents, must be received by the Exchange Agent at its address set forth under
" -- Exchange Agent," and either (i) tendered Old Capital Securities must be
received by the Exchange Agent, or (ii) such Old Capital Securities must be
tendered pursuant to the procedures for book-entry transfer set forth below and
a book-entry confirmation, including an Agent's Message if the tendering holder
has not delivered a Letter of Transmittal, must be received by the Exchange
Agent, in each case on or prior to the Expiration Date, or (iii) the guaranteed
delivery procedures set forth below must be complied with.
If less than all of the Old Capital Securities are tendered, a
tendering holder should fill in the amount of Old Capital Securities being
tendered in the appropriate box on the Letter of Transmittal. The entire
amount of Old Capital Securities delivered to the Exchange Agent will be deemed
to have been tendered unless otherwise indicated.
THE METHOD OF DELIVERY OF CERTIFICATES, THE LETTER OF TRANSMITTAL, AND
ALL OTHER REQUIRED DOCUMENTS, IS AT THE OPTION AND SOLE RISK OF THE TENDERING
HOLDER, AND DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE
EXCHANGE AGENT. IF DELIVERY IS BY MAIL, REGISTERED MAIL, RETURN RECEIPT
REQUESTED, PROPERLY INSURED, OR AN OVERNIGHT DELIVERY SERVICE IS RECOMMENDED. IN
ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.
BOOK ENTRY TRANSFER. The Exchange Agent will establish an account with
respect to the Old Capital Securities at DTC for purposes of the Exchange Offer
within two business days after the date of this Prospectus. Any financial
institution that is a participant in DTC's book-entry transfer facility system
may make a book-entry delivery of the Old Capital Securities by causing DTC to
transfer such Old Capital Securities into the Exchange Agent's account at DTC in
accordance with DTC's procedures for transfers. However, although delivery of
Old Capital Securities may be effected through book-entry transfer into the
Exchange Agent's account at DTC, the Letter of Transmittal (or facsimile
thereof), properly completed and duly executed, with any required signature
guarantees, or an Agent's Message in lieu of the Letter of Transmittal, and any
other required documents, must in any case be delivered to and received by the
Exchange Agent at its address set forth under " -- Exchange Agent" on or prior
to the Expiration Date, or the guaranteed delivery procedures set forth below
must be complied with.
DELIVERY OF DOCUMENTS TO DTC IN ACCORDANCE WITH DTC'S PROCEDURES DOES
NOT CONSTITUTE DELIVERY TO THE EXCHANGE AGENT.
SIGNATURE GUARANTEES. Certificates for the Old Capital Securities need
not be endorsed and signature guarantees on the Letter of Transmittal are
unnecessary unless (i) a certificate for the Old Capital Securities is
registered in a name other than that of the person surrendering the certificate
or (ii) such registered holder completes the box entitled "Special Issuance
Instructions" or "Special Delivery Instructions" in the Letter of Transmittal.
In the case of (i) or (ii) above, such certificates for Old Capital Securities
must be duly endorsed or accompanied by a properly executed
29
<PAGE> 33
bond power, with the endorsement or signature on the bond power and on the
Letter of Transmittal guaranteed by a firm or other entity identified in Rule
17Ad-15 under the Exchange Act as an "eligible guarantor institution," including
(as such terms are defined therein): (i) a bank; (ii) a broker, dealer,
municipal securities broker or dealer, or government securities broker or
dealer; (iii) a credit union; (iv) a national securities exchange, registered
securities association, or clearing agency; or (v) a savings association that is
a participant in a Securities Transfer Association (an "Eligible Institution"),
unless surrendered on behalf of such Eligible Institution. See Instruction 1 to
the Letter of Transmittal.
GUARANTEED DELIVERY. If a holder desires to tender Old Capital
Securities pursuant to the Exchange Offer and the certificates for such Old
Capital Securities are not immediately available or time will not permit all
required documents to reach the Exchange Agent on or before the Expiration Date,
or the procedures for book-entry transfer cannot be completed on a timely basis,
such Old Capital Securities may nevertheless be tendered, provided that all of
the following guaranteed delivery procedures are complied with:
(i) such tenders are made by or through an Eligible Institution;
(ii) a properly completed and duly executed Notice of Guaranteed
Delivery, substantially in the form accompanying the Letter of
Transmittal, is received by the Exchange Agent, as provided
below, on or prior to Expiration Date; and
(iii) the certificates (or a book-entry confirmation) representing
all tendered Old Capital Securities, in proper form for
transfer, together with a properly completed and duly executed
Letter of Transmittal (or facsimile thereof or Agent's Message
in lieu thereof), with any required signature guarantees and
any other documents required by the Letter of Transmittal, are
received by the Exchange Agent within three trading days after
the date of execution of such Notice of Guaranteed Delivery.
The Notice of Guaranteed Delivery may be delivered by hand or
transmitted by facsimile or mail to the Exchange Agent and must include a
guarantee by an Eligible Institution in the form set forth in such notice.
Notwithstanding any other provision hereof, the delivery of New Capital
Securities in exchange for Old Capital Securities tendered and accepted for
exchange pursuant to the Exchange Offer will in all cases be made only after
timely receipt by the Exchange Agent of Old Capital Securities, or of a
book-entry confirmation with respect to such Old Capital Securities, and a
properly completed and duly executed Letter of Transmittal (or facsimile thereof
or Agent's Message in lieu thereof), together with any required signature
guarantees and any other documents required by the Letter of Transmittal.
Accordingly, the delivery of New Capital Securities might not be made to all
tendering holders at the same time, and will depend upon when Old Capital
Securities, book-entry confirmations with respect to Old Capital Securities, and
other required documents are received by the Exchange Agent.
The Company's and the Trust's acceptance for exchange of Old Capital
Securities tendered pursuant to any of the procedures described above will
constitute a binding agreement among the tendering holder, the Company, and the
Trust upon the terms and subject to the conditions of the Exchange Offer.
DETERMINATION OF VALIDITY. All questions as to the form of documents,
validity, eligibility (including time of receipt), and acceptance for exchange
of any tendered Old Capital Securities will be determined by the Company and the
Trust, in their sole discretion, whose determination shall be final and binding
on all parties. The Company and the Trust reserve the absolute right, in their
sole discretion, to reject any and all tenders determined by them not to be in
proper form or the acceptance of which, or exchange for, may, in the view of
counsel to the Company or the Trust, be unlawful. The Company and the Trust also
reserve the absolute right, subject to applicable law, to waive any of the
conditions of the Exchange Offer as set forth under " -- Conditions to the
Exchange Offer" or any condition or irregularity in any tender of Old Capital
Securities of any particular holder whether or not similar conditions or
irregularities are waived in the case of other holders.
The Company's and the Trust's interpretation of the terms and
conditions of the Exchange Offer (including the Letter of Transmittal and the
instructions thereto) will be final and binding. No tender of Old Capital
Securities will be deemed to have been validly made until all irregularities
with respect to such tender have been cured or waived. Neither the Company, the
Trust, any affiliates or assigns of the Company or the Trust, the Exchange
Agent, nor any other person shall be under any duty to give any notification of
any irregularities in tenders or incur any liability for failure to give any
such notification.
If any Letter of Transmittal, endorsement, bond power, power of
attorney, or any other document required by the Letter of Transmittal is signed
by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a
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corporation, or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and unless waived by the Trust,
proper evidence satisfactory to the Company and the Trust, in their sole
discretion, of such person's authority to so act must be submitted.
A beneficial owner of Old Capital Securities that are held by or
registered in the name of a broker, dealer, commercial bank, trust company, or
other nominee or custodian is urged to contact such entity promptly if such
beneficial holder wishes to participate in the Exchange Offer.
RESALES OF NEW CAPITAL SECURITIES
The Trust is making the Exchange Offer for the Capital Securities in
reliance on the position of the staff of the Division of Corporation Finance of
the Commission as set forth in certain interpretive letters addressed to third
parties in other transactions. However, neither the Company nor the Trust sought
its own interpretive letter, and there can be no assurance that the staff of the
Division of Corporation Finance of the Commission would make a similar
determination with respect to the Exchange Offer as it has in such interpretive
letters to third parties. Based on these interpretations by the staff of the
Division of Corporation Finance, and subject to the two immediately following
sentences, the Company and the Trust believe that New Capital Securities issued
pursuant to this Exchange Offer in exchange for Old Capital Securities may be
offered for resale, resold, and otherwise transferred by a holder thereof (other
than a holder who is a broker-dealer) without further compliance with the
registration and prospectus delivery requirements of the Securities Act,
provided that such New Capital Securities are acquired in the ordinary course of
such holder's business and that such holder is not participating, and has no
arrangement or understanding with any person to participate, in a distribution
(within the meaning of the Securities Act) of such New Capital Securities.
However, any holder of Old Capital Securities who is an Affiliate or who intends
to participate in the Exchange Offer for the purpose of distributing New Capital
Securities, or any broker-dealer who purchased Old Capital Securities from the
Trust to resell pursuant to Rule 144A or any other available exemption under the
Securities Act, (i) will not be able to rely on the interpretations of the staff
of the Division of Corporation Finance of the Commission set forth in the
above-mentioned interpretive letters, (ii) will not be permitted or entitled to
tender such Old Capital Securities in the Exchange Offer, and (iii) must comply
with the registration and prospectus delivery requirements of the Securities Act
in connection with any sale or other transfer of such Old Capital Securities
unless such sale is made pursuant to an exemption from such requirements. In
addition, as described below, Participating Broker-Dealers must deliver a
prospectus meeting the requirements of the Securities Act in connection with any
resales of New Capital Securities.
Each holder of Old Capital Securities who wishes to exchange Old
Capital Securities for New Capital Securities in the Exchange Offer will be
required to represent that (i) it is not an Affiliate, (ii) any New Capital
Securities to be received by it are being acquired in the ordinary course of its
business, (iii) it has no arrangement or understanding with any person to
participate in a distribution (within the meaning of the Securities Act) of such
New Capital Securities, and (iv) if such holder is not a broker-dealer, such
holder is not engaged in, and does not intend to engage in, a distribution
(within the meaning of the Securities Act) of such New Capital Securities. The
Letter of Transmittal contains the foregoing representations. In addition, the
Company and the Trust may require such holder, as a condition to such holder's
eligibility to participate in the Exchange Offer, to furnish to the Company and
the Trust (or an agent thereof) in writing information as to the number of
"beneficial owners" (within the meaning of Rule 13d-3 under the Exchange Act) on
behalf of whom such holder holds the Old Capital Securities to be exchanged in
the Exchange Offer. Each Participating Broker-Dealer will be deemed to have
acknowledged by execution of the Letter of Transmittal or delivery of an Agent's
Message that it acquired the Old Capital Securities for its own account as the
result of market-making activities or other trading activities and must agree
that it will deliver a prospectus meeting the requirements of the Securities Act
in connection with any resale of such New Capital Securities. The Letter of
Transmittal states that by so acknowledging and by delivering a prospectus, a
Participating Broker-Dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act. Based on the position
taken by the staff of the Division of Corporation Finance of the Commission in
the interpretive letters referred to above, the Company and the Trust believe
that Participating Broker-Dealers may fulfill their prospectus delivery
requirements with respect to the New Capital Securities received upon exchange
of such Old Capital Securities (other than Old Capital Securities which
represent an unsold allotment from the original sale of the Old Capital
Securities) with a prospectus meeting the requirements of the Securities Act,
which may be the prospectus prepared for an exchange offer so long as it
contains a description of the plan of distribution with respect to the resale of
such New Capital Securities. Accordingly, this Prospectus, as it may be amended
or supplemented from time to time, may be used by a Participating Broker-Dealer
during the period referred to below in connection with resales of New Capital
Securities received in exchange for Old Capital Securities where such Old
Capital Securities were acquired by such Participating Broker-Dealer for its own
account as a result of market-making or other trading activities. Subject to
certain provisions set forth in the Registration Rights Agreement, the Company
and the Trust have agreed that this Prospectus, as it may be amended or
supplemented from time to time,
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may be used by a Participating Broker-Dealer in connection with resales of such
New Capital Securities for a period ending 180 days after the Expiration Date
or, if earlier, when all such New Capital Securities have been disposed of by
such Participating Broker-Dealer. See "Plan of Distribution." Any person,
including any Participating Broker-Dealer, who is an Affiliate may not rely on
such interpretive letters and must comply with the registration and prospectus
delivery requirements of the Securities Act in connection with any resale
transaction.
In that regard, each Participating Broker-Dealer who surrenders Old
Capital Securities pursuant to the Exchange Offer will be deemed to have agreed,
by execution of the Letter of Transmittal or delivery of an Agent's Message in
lieu thereof, that, upon receipt of notice from the Company or the Trust of the
occurrence of any event or the discovery of any fact which makes any statement
contained or incorporated by reference in this Prospectus untrue in any material
respect or which causes this Prospectus to omit to state a material fact
necessary in order to make the statements contained or incorporated by reference
herein, in light of the circumstances under which they were made, not misleading
or of the occurrence of certain other events specified in the Registration
Rights Agreement, such Participating Broker-Dealer will suspend the sale of New
Capital Securities pursuant to this Prospectus until the Company or the Trust
has amended or supplemented this Prospectus to correct such misstatement or
omission and has furnished copies of the amended or supplemented Prospectus to
such Participating Broker-Dealer or the Company or the Trust has given notice
that the sale of the New Capital Securities may be resumed, as the case may be.
WITHDRAWAL RIGHTS
Except as otherwise provided herein, tenders of Old Capital Securities
may be withdrawn at any time on or prior to the Expiration Date.
In order for a withdrawal to be effective, a written, telegraphic,
telex, or facsimile transmission of such notice of withdrawal must be timely
received by the Exchange Agent at its address set forth under "-- Exchange
Agent" on or prior to the Expiration Date. Any such notice of withdrawal must
specify the name of the person who tendered the Old Capital Securities to be
withdrawn, the aggregate principal amount of Old Capital Securities to be
withdrawn, and (if certificates for such Old Capital Securities have been
tendered) the name of the registered holder of the Old Capital Securities as set
forth on the Old Capital Securities, if different from that of the person who
tendered such Old Capital Securities. If Old Capital Securities have been
delivered or otherwise identified to the Exchange Agent, then prior to the
physical release of such Old Capital Securities, the tendering holder must
submit the certificate numbers shown on the particular Old Capital Securities to
be withdrawn and the signature on the notice of withdrawal must be guaranteed by
an Eligible Institution, except in the case of Old Capital Securities tendered
for the account of an Eligible Institution. If Old Capital Securities have been
tendered pursuant to the procedures for book-entry transfer set forth in
"-- Procedures for Tendering Old Capital Securities," the notice of withdrawal
must specify the name and number of the account at DTC to be credited with the
withdrawal of Old Capital Securities, in which case a notice of withdrawal will
be effective if delivered to the Exchange Agent by written, telegraphic, telex,
or facsimile transmission. Withdrawals of tenders of Old Capital Securities may
not be rescinded. Old Capital Securities properly withdrawn will not be deemed
validly tendered for purposes of the Exchange Offer, but may be retendered at
any subsequent time on or prior to the Expiration Date by following any of the
procedures described above under "-- Procedures for Tendering Old Capital
Securities."
All questions as to the validity, form, and eligibility (including time
of receipt) of such withdrawal notices will be determined by the Company and the
Trust, in their sole discretion, whose determination shall be final and binding
on all parties. None of the Company, the Trust, any affiliates or assigns of the
Company or the Trust, the Exchange Agent, or any other person shall be under any
duty to give any notification of any irregularities in any notice of withdrawal
or incur any liability for failure to give any such notification. Any Old
Capital Securities which have been tendered but which are withdrawn will be
returned to the holder thereof promptly after withdrawal.
DISTRIBUTIONS ON NEW CAPITAL SECURITIES
Holders of Old Capital Securities whose Old Capital Securities are
accepted for exchange will not receive accumulated Distributions on such Old
Capital Securities for any period from and after the last Distribution Date with
respect to such Old Capital Securities prior to the original issue date of the
New Capital Securities and will be deemed to have waived the right to receive
any Distributions on such Old Capital Securities accumulated from and after such
Distribution Date.
CONDITIONS TO EXCHANGE OFFER
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Notwithstanding any other provisions of the Exchange Offer, or any
extension of the Exchange Offer, the Company and the Trust will not be required
to accept for exchange, or to exchange, any Old Capital Securities for any New
Capital Securities, and, as described below, may terminate the Exchange Offer
(whether or not any Old Capital Securities have theretofore been accepted for
exchange) or may waive any conditions to or amend the Exchange Offer, if any of
the following conditions have occurred or exists or have not been satisfied:
(a) there shall occur a change in the current interpretation by
the staff of the Commission which permits the New Capital
Securities issued pursuant to the Exchange Offer in exchange
for Old Capital Securities to be offered for resale, resold,
and otherwise transferred by holders thereof (other than
broker-dealers and any such holder which is an Affiliate)
without compliance with the registration and prospectus
delivery provisions of the Securities Act, provided that such
New Capital Securities are acquired in the ordinary course of
such holders' business and such holders have no arrangement or
understanding with any person to participate in the
distribution of such New Capital Securities;
(b) any action or proceeding shall have been instituted or
threatened in any court or by or before any governmental
agency or body with respect to the Exchange Offer which, in
the Company's and the Trust's judgment, would reasonably be
expected to impair the ability of the Trust or the Company to
proceed with the Exchange Offer;
(c) any law, statute, rule, or regulation shall have been adopted
or enacted which, in the Company's and the Trust's judgment,
would reasonably be expected to impair the ability of the
Trust or the Company to proceed with the Exchange Offer;
(d) a banking moratorium shall have been declared by United States
federal or Ohio or New York State authorities which, in the
Company's and the Trust's judgment, would reasonably be
expected to impair the ability of the Trust or the Company to
proceed with the Exchange Offer;
(e) trading generally in the United States over-the-counter
market shall have been suspended by order of the Commission or
any other governmental authority which, in the Company's and
the Trust's judgment, would reasonably be expected to impair
the ability of the Trust or the Company to proceed with the
Exchange Offer;
(f) a stop order shall have been issued by the Commission or any
state securities authority suspending the effectiveness of the
Registration Statement or proceedings shall have been
initiated or, to the knowledge of the Company or the Trust,
threatened for that purpose any governmental approval has not
been obtained, which approval the Company and the Trust shall
deem necessary for the consummation of the Exchange Offer as
contemplated hereby; or
(g) any change, or any development involving a prospective change,
in the business or financial affairs of the Trust or the
Company or any of its subsidiaries has occurred which, in the
judgment of the Company and the Trust, might materially impair
the ability of the Trust or the Company to proceed with the
Exchange Offer.
If the Company and the Trust determine in their sole discretion that
any of the foregoing events or conditions has occurred or exists or has not been
satisfied, the Company and the Trust may, subject to applicable law, terminate
the Exchange Offer (whether or not any Old Capital Securities have theretofore
been accepted for exchange) or may waive any such condition or otherwise amend
the terms of the Exchange Offer in any respect. If such waiver or amendment
constitutes a material change to the Exchange Offer, the Company and the Trust
will promptly disclose such waiver by means of an amended or supplemented
Prospectus that will be distributed to the registered holders of the Old Capital
Securities, and the Company and the Trust will extend the Exchange Offer to the
extent required by Rule 14e-1 under the Exchange Act.
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EXCHANGE AGENT
The Chase Manhattan Bank has been appointed as Exchange Agent for the
Exchange Offer. Delivery of the Letters of Transmittal and any other required
documents, questions, requests for assistance, and requests for additional
copies of this Prospectus or of the Letter of Transmittal should be directed to
the Exchange Agent as follows:
The Chase Manhattan Bank
450 West 33rd Street, 15th Floor
New York, New York 10001
Attention: Global Trust Services
Telephone: (212) 946-3042
Facsimile: (212) 946-8154
Delivery to other than the above address or facsimile number will not
constitute a valid delivery.
FEES AND EXPENSES
The Company has agreed to pay the Exchange Agent reasonable and
customary fees for its services and will reimburse it for its reasonable
out-of-pocket expenses in connection therewith. The Company will also pay
brokerage houses and other custodians, nominees, and fiduciaries the reasonable
out-of-pocket expenses incurred by them in forwarding copies of this Prospectus
and related documents to the beneficial owners of Old Capital Securities, and in
handling or tendering for their customers.
Holders who tender their Old Capital Securities for exchange will not
be obligated to pay any transfer taxes in connection therewith. If, however, New
Capital Securities are to be delivered to, or are to be issued in the name of,
any person other than the registered holder of the Old Capital Securities
tendered, or if a transfer tax is imposed for any reason other than the exchange
of Old Capital Securities in connection with the Exchange Offer, then the amount
of any such transfer taxes (whether imposed on the registered holder or any
other persons) will be payable by the tendering holder. If satisfactory evidence
of payment of such taxes or exemption therefrom is not submitted with the Letter
of Transmittal, the amount of such transfer taxes will be billed directly to
such tendering holder.
Neither the Company nor the Trust will make any payment to brokers,
dealers, or others soliciting acceptances of the Exchange Offer.
DESCRIPTION OF NEW SECURITIES
DESCRIPTION OF CAPITAL SECURITIES
Pursuant to the terms of the Declaration, the Trust has issued the Old
Capital Securities and the Common Securities and will issue the New Capital
Securities. The New Capital Securities will represent undivided beneficial
ownership interests in the assets of the Trust and the holders thereof will be
entitled to a preference over the Common Securities in certain circumstances
with respect to Distributions and amounts payable on redemption of the Trust
Securities or liquidation of the Trust, as well as other benefits as described
in the Declaration. The Declaration has been qualified under the Trust Indenture
Act of 1939, as amended (the "Trust Indenture Act"). This summary of certain
provisions of the Capital Securities, the Common Securities, and the Declaration
does not purport to be complete and is subject to, and is qualified in its
entirety by reference to, all the provisions of the Declaration, including the
definitions therein of certain terms, and the Trust Indenture Act. Wherever
particular defined terms of the Declaration (as supplemented or amended from
time to time) are referred to herein, the definitions of such defined terms are
incorporated herein by reference.
GENERAL
The Capital Securities (including the Old Capital Securities and the
New Capital Securities) are limited to $200,000,000 aggregate Liquidation Amount
at any one time outstanding. The Capital Securities rank pari passu, and
payments will be made thereon pro rata, with the Common Securities, except as
described under "-- Subordination of
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Common Securities." Legal title to the Subordinated Debentures is held by the
Property Trustee in trust for the benefit of the holders of the Capital
Securities and the Common Securities. The Guarantee executed by the Company for
the benefit of the holders of the Capital Securities is a guarantee on a
subordinated basis with respect to the Capital Securities but does not guarantee
payment of Distributions or amounts payable on redemption of the Capital
Securities or liquidation of the Trust when the Trust does not have sufficient
funds available to make such payments. See "-- Description of Guarantee." The
Company's obligations under the Guarantee, taken together with its obligations
under the Subordinated Debentures and the Indenture, including its obligation to
pay all costs, expenses, and liabilities of the Trust (other than with respect
to the Capital Securities), constitute a full and unconditional guarantee of all
of the Trust's obligations under the Capital Securities.
Holders of the Capital Securities have no preemptive or similar rights.
DISTRIBUTIONS
Distributions on each Capital Security are payable in U.S. dollars at a
variable annual rate equal to LIBOR plus .70% (which is the same rate payable on
the Subordinated Debentures) on the Liquidation Amount of $1,000, payable
quarterly in arrears on the last day of January, April, July, and October of
each year. See "-- Description of Subordinated Debentures -- Interest." The
first Distribution Date was April 30, 1997. The final Distributions will be
payable on February 1, 2027, and will accumulate from the last Distribution Date
prior to such date up to and including January 31, 2027. The amount of
Distributions payable for any period will be computed on the basis of the actual
number of days elapsed in a year of twelve 30-day months.
Distributions on the Capital Securities must be paid on the dates
payable to the extent that the Trust has funds available for the payment of such
Distributions. The revenue of the Trust available for distribution to holders of
its Capital Securities will be limited to payments under the Subordinated
Debentures in which the Trust will invest the proceeds from the issuance and
sale of the Capital Securities and the Common Securities. See "-- Description of
Subordinated Debentures." If the Company does not make interest payments on the
Subordinated Debentures, the Property Trustee will not have funds available to
pay Distributions on the Capital Securities.
The Company will have the right under the Indenture to defer the
payment of interest on the Subordinated Debentures at any time or from time to
time for a period not exceeding 20 consecutive quarters, provided that no
Extension Period may extend beyond the Stated Maturity of the Subordinated
Debentures. Accordingly, there could be multiple Extension Periods of varying
lengths throughout the term of the Subordinated Debentures. As a consequence of
any such extension, quarterly Distributions on the Capital Securities will be
deferred by the Trust during any such Extension Period. Distributions to which
holders of the Capital Securities are entitled will accumulate and compound
quarterly at a variable annual rate equal to LIBOR plus .70% from the relevant
payment date for such Distributions. The term "Distributions" as used herein
shall include any such compounded amounts unless the context otherwise requires.
During any such Extension Period, the Company may not, and may not permit any
subsidiary of the Company to, (i) declare or pay any dividends or distributions
on, or redeem, purchase, acquire, or make a liquidation payment with respect to,
any of the Company's capital stock or (ii) make any payment of principal,
interest, or premium, if any, on or repay, repurchase, or redeem any debt
securities of the Company that rank pari passu with or junior to the
Subordinated Debentures or make any guarantee payments with respect to any
guarantee by the Company of the debt securities of any subsidiary of the Company
if such guarantee ranks pari passu with or junior in interest to the
Subordinated Debentures (other than (a) repurchases, redemptions, or other
acquisitions of shares of capital stock of the Company in connection with any
employment contract, benefit plan, or other similar arrangement with or for the
benefit of any one or more employees, officers, directors, or consultants, or in
connection with a dividend reinvestment or stockholder stock purchase plan, (b)
as a result of an exchange or conversion of any class or series of the Company's
capital stock (or any capital stock of a subsidiary of the Company) for any
other class or series of the Company's capital stock or of any class or series
of the Company's indebtedness for any class or series of the Company's capital
stock, (c) the purchase of fractional interests in shares of the Company's
capital stock pursuant to the conversion or exchange provisions of such capital
stock or the security being converted or exchanged, (d) any declaration of a
dividend in connection with any stockholders' rights plan, or the issuance of
rights, stock, or other property under any stockholders' rights plan, or the
redemption or repurchase of rights pursuant thereto, or (e) any dividend in the
form of stock, warrants, options, or other rights where the dividend stock or
the stock issuable upon exercise of such warrants, options, or other rights is
the same stock as that on which the dividend is being paid (or ranks pari passu
with or junior to such stock)). Prior to the termination of any such Extension
Period, the Company may further extend the Extension Period, provided that no
Extension Period may exceed 20 consecutive quarters or extend beyond the Stated
Maturity of the Subordinated Debentures. Upon the termination of any such
Extension Period and the payment of all amounts then due on any Interest Payment
Date, the Company may elect to begin a new Extension Period subject to the
foregoing requirements.
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See "-- Description of Subordinated Debentures -- Option to Extend Interest
Payment Period." The Company has no current intention of exercising its right to
defer payments of interest by extending the interest payment period of the
Subordinated Debentures.
The Property Trustee will cause the rate of Distributions, the amount
of Distributions, the payment dates for each Distribution, and the Extension
Period, if any, to be provided to the Luxembourg Stock Exchange and published in
a daily newspaper in Luxembourg (which is expected to be the Luxemburger Wort)
as soon as possible after the determination thereof.
In the event that any date on which Distributions are payable on the
Capital Securities is not a Business Day (as defined below), then payment of the
Distributions payable on such date will be made on the next succeeding day that
is a Business Day (and without any additional Distributions or other payment in
respect of any such delay), with the same force and effect as if made on the
date such payment was originally payable (each date on which Distributions are
payable in accordance with the foregoing, a "Distribution Date"). A "Business
Day" shall mean any day other than a Saturday or a Sunday, or a day on which
banking institutions in the City of New York or the City of Columbus are
authorized or required by law or executive order to remain closed or a day on
which the corporate trust office of the Property Trustee or the Indenture
Trustee is closed for business.
Distributions on the Capital Securities (other than distributions on a
Redemption Date (as defined herein)) are payable to the holders thereof as they
appear on the register of the Trust on the relevant record dates, which is the
fifteenth day of the month of the relevant Distribution Date. Distributions
payable on any Capital Securities that are not punctually paid on any
Distribution Date will cease to be payable to the person in whose name such
Capital Securities are registered on the relevant record date, and such
defaulted Distribution will instead be payable to the person in whose name such
Capital Securities are registered on the special record date or other specified
date determined in accordance with the Declaration.
REDEMPTION
Mandatory Redemption. Unless a Special Event has occurred, the Capital
Securities will not be redeemable prior to February 1, 2007. The Capital
Securities and the Common Securities will mature at their stated amount of
$1,000 per Trust Security (the "Liquidation Amount"), unless redeemed prior
thereto, on February 1, 2027. Upon the repayment or redemption, in whole or in
part, of the Subordinated Debentures, whether at Stated Maturity or upon earlier
redemption as provided in the Indenture, the proceeds from such repayment or
redemption shall be applied by the Property Trustee to redeem Capital Securities
and Common Securities upon not less than 30 nor more than 60 days' notice prior
to the date fixed for repayment or redemption. If less than all of the
Subordinated Debentures are to be repaid or redeemed on a Redemption Date, then
the proceeds from such repayment or redemption shall be allocated to the
redemption pro rata of the Capital Securities and the Common Securities.
Special Event Redemption or Distribution of Subordinated Debentures. If
a Special Event shall occur and be continuing, the Company will have the right,
subject to the receipt of any necessary prior approval of the Federal Reserve,
to either (i) redeem within 90 days following the occurrence of such Special
Event the Subordinated Debentures on the date of redemption (the "Redemption
Date") in whole (but not in part) and thereby cause a mandatory redemption of
the Capital Securities in whole (but not in part) at a redemption price with
respect to the Capital Securities equal to the redemption price in respect of
the Subordinated Debentures or (ii) to dissolve the Trust and, after
satisfaction of the claims of creditors of the Trust as provided by applicable
law, cause the Subordinated Debentures to be distributed to the holders of the
Capital Securities in liquidation of the Trust. Under current United States
federal income tax law and interpretations thereof and assuming, as expected,
the Trust is treated as a grantor trust, a distribution of the Subordinated
Debentures should not be a taxable event to holders of the Capital Securities.
Should there be a change in law, a change in legal interpretation, certain Tax
Events, or other circumstances, however, the distribution could be a taxable
event to holders of the Capital Securities. See "Certain United States Federal
Income Tax Consequences -- Distribution of Subordinated Debentures or Cash Upon
Liquidation of the Trust."
If the Company does not elect either option described above, the
Capital Securities will remain outstanding until the repayment of the
Subordinated Debentures, whether at Stated Maturity or their earlier redemption,
and in the event a Tax Event has occurred and is continuing, the Company will be
obligated to pay any additional taxes, duties, assessments, and other
governmental charges (other than withholding taxes) to which the Trust has
become subject as a result of a Tax Event.
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A Special Event means a Tax Event, a Regulatory Capital Event, or an
Investment Company Event. A "Tax Event" means the receipt by the Company of an
opinion of counsel, rendered by a law firm experienced in such matters, to the
effect that, as a result of any amendment to, change in, or announced proposed
change in the laws (or any regulations thereunder) of the United States or any
political subdivision or taxing authority thereof or therein, or as a result of
any official or administrative pronouncement or action or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
adopted or which proposed change, pronouncement, or action or decision is
announced or which action is taken on or after the date of original issuance of
the Capital Securities, there is more than an insubstantial risk that (i) the
Trust is, or will be within 90 days of the date of such opinion, subject to
United States federal income tax with respect to income received or accrued on
the Subordinated Debentures, (ii) interest payable by the Company on such
Subordinated Debentures is not, or within 90 days of the date of such opinion,
will not be, deductible by the Company, in whole or in part, for United States
federal income tax purposes, or (iii) the Trust is, or will be within 90 days of
the date of such opinion, subject to more than a de minimis amount of other
taxes, duties, or other governmental charges. A "Regulatory Capital Event" means
that the Company shall have received an opinion of independent bank regulatory
counsel experienced in such matters to the effect that, as a result of (a) any
amendment to or change (including any announced prospective change) in the laws
(or any regulations thereunder) of the United States or any rules, guidelines,
or policies of the Federal Reserve or (b) any official or administrative
pronouncement or action or judicial decision interpreting or applying such laws
or regulations, which amendment or change is effective or such pronouncement or
action or decision is announced on or after the date of original issuance of the
Capital Securities, the Capital Securities do not constitute, or within 90 days
of the date thereof, will not constitute Tier 1 capital (or its then
equivalent); provided, however, that the distribution of the Subordinated
Debentures in connection with the liquidation of the Trust by the Company shall
not in and of itself constitute a Regulatory Capital Event unless such
liquidation shall have occurred in connection with a Tax Event or an Investment
Company Event. "Investment Company Event" means the receipt by the Trust of an
opinion of counsel, rendered by a law firm experienced in such matters, to the
effect that, as a result of the occurrence of a change in law or regulation or a
change in interpretation or application of law or regulation by any legislative
body, court, governmental agency, or regulatory authority (a "Change in 1940 Act
Law"), the Trust is or will be considered an "investment company" that is
required to be registered under the Investment Company Act of 1940, as amended,
which Change in 1940 Act Law becomes effective on or after the date of original
issuance of the Capital Securities.
REDEMPTION PROCEDURES
Capital Securities redeemed on each Redemption Date shall be redeemed
at the redemption price received by the Trust in respect of the Subordinated
Debentures (the "Redemption Price") with the applicable proceeds from the
contemporaneous redemption or payment at Stated Maturity of the Subordinated
Debentures. Redemption of the Capital Securities shall be made and the
Redemption Price shall be payable on each Redemption Date only to the extent
that the Trust has sufficient funds available for the payment of such Redemption
Price. See also "-- Subordination of Common Securities."
Notice of any redemption will be mailed at least 30 days but not more
than 60 days before the Redemption Date to each holder of Capital Securities to
be redeemed at its registered address. If the Trust gives a notice of redemption
in respect of the Capital Securities, then, by 12:00 noon, New York City time,
on the Redemption Date, to the extent funds are available, the Property Trustee
will deposit irrevocably with DTC or its nominee funds sufficient to pay the
applicable Redemption Price for all securities held in DTC and will give DTC
irrevocable instructions and authority to pay the Redemption Price to the
holders of the Capital Securities held through DTC. See "Book-Entry Issuance."
If any Capital Securities are held in certificated form, the Trust, to the
extent funds are available, will irrevocably deposit with the paying agent for
such Capital Securities funds sufficient to pay the applicable Redemption Price
and will give the paying agent irrevocable instructions and authority to pay the
Redemption Price to the holders thereof upon surrender of their certificates
evidencing the Capital Securities. Notwithstanding the foregoing, Distributions
payable on or prior to the Redemption Date for any Capital Security called for
redemption shall be payable to the holders of such Capital Security on the
relevant record dates for the related Distribution Dates. If notice of
redemption shall have been given and funds deposited as required, then upon the
date of such deposit, all rights of the holders of such Capital Securities so
called for redemption will cease, except the right of the holders of such
Capital Securities to receive the Redemption Price, but without interest on such
Redemption Price, and such Capital Securities will cease to be outstanding. In
the event that any date fixed for redemption of Capital Securities is not a
Business Day, then payment of the Redemption Price payable on such date will be
made on the next succeeding day which is a Business Day (and without any
interest or other payment in respect of any such delay), except that, if such
Business Day falls in the next calendar year, such payment will be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on the date such payment was originally payable. In the event that
payment of the Redemption Price in respect of Capital Securities called for
redemption is improperly withheld or refused and not paid either by the
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Trust or by the Company pursuant to the Guarantee as described under
"--Description of Guarantee," Distributions on such Capital Securities will
continue to accrue at the then applicable rate, from the Redemption Date
originally established by the Trust for the Capital Securities to the date such
Redemption Price is actually paid, in which case the actual payment date will be
the date fixed for redemption for purposes of calculating the Redemption Price.
Subject to applicable law (including, without limitation, United States
federal securities law) and to the provisions of the Declaration, the Company or
its subsidiaries may at any time and from time to time purchase outstanding
Capital Securities by tender, in the open market, or by private agreement.
The Trust may not redeem fewer than all of the outstanding Capital
Securities unless all accrued and unpaid Distributions have been paid on all
Capital Securities for all quarterly distribution periods terminating on or
prior to the date of redemption. If less than all of the Capital Securities and
Common Securities issued by the Trust are to be redeemed on a Redemption Date,
then the aggregate amount of such Capital Securities and Common Securities to be
redeemed shall be allocated pro rata among the Capital Securities and the Common
Securities. If the Capital Securities are in book-entry form, they will be
redeemed as described below under "Book-Entry Issuance." If not, the particular
Capital Securities to be redeemed shall be selected on a pro rata basis not more
than 60 days prior to the Redemption Date by the Property Trustee from the
outstanding Capital Securities not previously called for redemption, by such
method as the Property Trustee shall deem fair and appropriate and which may
provide for the selection for redemption of portions (equal to $1,000 or an
integral multiple of $1,000 in excess thereof) of the Liquidation Amount of
Capital Securities of a denomination larger than $1,000. The Property Trustee
shall promptly notify the Trust registrar in writing of the Capital Securities
selected for redemption and, in the case of any Capital Security selected for
partial redemption, the Liquidation Amount thereof to be redeemed. For all
purposes of the Declaration, unless the context otherwise requires, all
provisions relating to the redemption of Capital Securities shall relate, in the
case of any Capital Security redeemed or to be redeemed only in part, to the
portion of the aggregate Liquidation Amount of Capital Securities which has been
or is to be redeemed.
SUBORDINATION OF COMMON SECURITIES
Payment of Distributions on, and the Redemption Price of, the Capital
Securities and the Common Securities, as applicable, shall be made pro rata
based on the Liquidation Amount of such Capital Securities and Common
Securities; provided, however, that if on any Distribution Date or Redemption
Date an Indenture Event of Default shall have occurred and be continuing, no
payment of any Distribution on, or Redemption Price of, any of the Common
Securities, and no other payment on account of the redemption, liquidation, or
other acquisition of such Common Securities, shall be made unless payment in
full in cash of all accumulated and unpaid Distributions on all of the
outstanding Capital Securities for all Distribution periods terminating on or
prior thereto, or in the case of payment of the Redemption Price, the full
amount of such Redemption Price on all of the outstanding Capital Securities
then called for redemption, shall have been made or provided for, and all funds
available to the Property Trustee shall first be applied to the payment in full
in cash of all Distributions on, or Redemption Price of, the Capital Securities
then due and payable.
LIQUIDATION DISTRIBUTION UPON DISSOLUTION
Pursuant to the Declaration, the Trust shall automatically dissolve
upon expiration of its term and shall dissolve on the first to occur of: (i) any
liquidation, insolvency, or similar proceeding with respect to the Company or
all or substantially all of its property, (ii) the distribution of the
Subordinated Debentures to the holders of the Capital Securities and Common
Securities; (iii) the repayment of all of the Capital Securities in connection
with the maturity or redemption of all of the Subordinated Debentures; and (iv)
the entry by a court of competent jurisdiction of an order for the dissolution
of the Trust. Notice of such liquidation shall be given to the holders of the
Common Securities and Capital Securities by the Declaration Trustees within
30 days of such event.
If an early dissolution occurs as described in clause (i), (ii), or
(iv) above, the Trust shall be liquidated by the Declaration Trustees as
expeditiously as the Declaration Trustees determine to be possible by
distributing, after satisfaction of liabilities to creditors of the Trust as
provided by applicable law, to the holders of the Capital Securities and Common
Securities their pro rata interest in the Subordinated Debentures, unless such
distribution is determined by the Property Trustee not to be practicable, in
which event such holders will be entitled to receive out of the assets of the
Trust available for distribution to holders, after satisfaction of liabilities
to creditors of the Trust as provided by applicable law, an amount equal to, in
the case of holders of Capital Securities, the aggregate of the Liquidation
Amount plus accrued and unpaid Distributions thereon to the date of payment
(such amount being the "Liquidation Distribution"). If such Liquidation
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Distribution can be paid only in part because the Trust has insufficient assets
available to pay in full the aggregate Liquidation Distribution, then the
amounts payable directly by the Trust on the Capital Securities shall be paid on
a pro rata basis. The holder of the Common Securities will be entitled to
receive distributions upon any such liquidation pro rata with the holders of the
Capital Securities, except that if an Indenture Event of Default has occurred
and is continuing, the Capital Securities shall have a priority over the Common
Securities.
Upon any liquidation in which the Subordinated Debentures are
distributed, if at any time of such liquidation the Capital Securities are (i)
rated by at least one nationally recognized statistical rating organization,
(ii) listed on the Luxembourg Stock Exchange, or (iii) eligible for quotation in
PORTAL, the Company shall use its best efforts to (a) obtain from at least one
nationally recognized statistical rating organization, a rating for the
Subordinated Debentures, (b) list the Subordinated Debentures on the Luxembourg
Stock Exchange, or (c) qualify the Subordinated Debentures for quotation in
PORTAL, as the case may be.
After the liquidation date is fixed for any distribution of
Subordinated Debentures to holders of the Capital Securities (i) the Capital
Securities will no longer be deemed to be outstanding, (ii) DTC or its nominee,
as a record holder of Capital Securities, will receive a registered global
certificate or certificates representing the Subordinated Debentures to be
delivered to it upon such distribution, and (iii) any certificates representing
Capital Securities held in certificated form will be deemed to represent
Subordinated Debentures having a principal amount equal to the Liquidation
Amount of such Capital Securities, and bearing accrued and unpaid interest in an
amount equal to the accrued and unpaid Distributions on such Capital Securities
until such certificates are presented for cancellation whereupon the Company
will issue to such holder, and the Indenture Trustee will authenticate, a
certificate representing such Subordinated Debentures.
TRUST ENFORCEMENT EVENTS
An Indenture Event of Default constitutes a "Trust Enforcement Event"
under the Declaration with respect to the Trust Securities, provided that
pursuant to the Declaration, the holder of the Common Securities will be deemed
to have waived any Trust Enforcement Event with respect to the Common Securities
until all Trust Enforcement Events with respect to the Capital Securities have
been cured, waived, or otherwise eliminated. Until such Trust Enforcement Event
with respect to the Capital Securities has been so cured, waived, or otherwise
eliminated, the Property Trustee will be deemed to be acting solely on behalf of
the holders of the Capital Securities and only the holders of the Capital
Securities will have the right to direct the Property Trustee with respect to
certain matters under the Declaration, and therefore the Indenture.
Upon the occurrence of a Trust Enforcement Event, the Indenture Trustee
or the Property Trustee as the holder of the Subordinated Debentures will have
the right under the Indenture to declare the principal of and interest on the
Subordinated Debentures to be immediately due and payable. Each of the Company
and the Trust is required to file annually with the Property Trustee an
officer's certificate as to its compliance with all conditions and covenants
under the Declaration.
If the Property Trustee fails to enforce its rights with respect to the
Subordinated Debentures held by the Trust, any record holder of Capital
Securities may, to the fullest extent permitted by law, institute legal
proceedings directly against the Company to enforce the Property Trustee's
rights under such Subordinated Debentures without first instituting any legal
proceedings against such Property Trustee or any other person or entity. In
addition, if a Trust Enforcement Event has occurred and is continuing and such
event is attributable to the failure of the Company to pay interest, principal,
or other required payments on the Subordinated Debentures issued to the Trust on
the date such interest, principal, or other payment is otherwise payable, then a
record holder of Capital Securities may, on or after the respective due dates
specified in the Subordinated Debentures, institute a proceeding directly
against the Company under the Indenture for enforcement of payment on
Subordinated Debentures having a principal amount equal to the aggregate
Liquidation Amount of the Capital Securities held by such holder. In connection
with such Direct Action, the Company will be subrogated to the rights of such
record holder of Capital Securities to the extent of any payment made by the
Company to such record holder of Capital Securities.
VOTING RIGHTS; AMENDMENT OF THE DECLARATION
Except as provided below and under "-- Description of Guarantee --
Amendments and Assignment" and as otherwise required by law and the Declaration,
the holders of the Capital Securities have no voting rights. The Regular
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Trustees are required to call a meeting of the holders of the Capital Securities
if directed to do so by holders of at least 10% in aggregate Liquidation Amount
thereof.
So long as any Subordinated Debentures are held by the Property
Trustee, the Declaration Trustees shall not (i) direct the time, method, and
place of conducting any proceeding for any remedy available to the Indenture
Trustee or executing any trust or power conferred on the Property Trustee with
respect to such Subordinated Debentures, (ii) waive any past default that is
waivable under the Indenture, (iii) exercise any right to rescind or annul a
declaration that the principal of all the Subordinated Debentures shall be due
and payable, or (iv) consent to any amendment, modification, or termination of
the Indenture or such Subordinated Debentures, where such consent shall be
required, without, in each case, obtaining the prior approval of the holders of
a majority in aggregate Liquidation Amount of all outstanding Capital
Securities; provided, however, that where a consent under the Indenture would
require the consent of each holder of Subordinated Debentures affected thereby,
no such consent shall be given by the Property Trustee without the prior consent
of each holder of Capital Securities. The Declaration Trustees shall not revoke
any action previously authorized or approved by a vote of the holders of the
Capital Securities except pursuant to a subsequent vote of the holders of the
Capital Securities. The Property Trustee shall notify each holder of record of
the Capital Securities of any notice of default which it receives with respect
to the Subordinated Debentures. In addition to obtaining the foregoing approvals
of the holders of the Capital Securities, prior to taking any of the foregoing
actions, the Declaration Trustees shall receive an opinion of counsel
experienced in such matters to the effect that the Trust will not be classified
as other than a grantor trust for United States federal income tax purposes on
account of such action.
The Declaration may be amended from time to time by the holders of a
majority of the Common Securities and the Regular Trustee (and in certain
circumstances the Property Trustee and the Delaware Trustee), without the
consent of the holders of the Capital Securities, (i) to cure any ambiguity,
correct or supplement any provisions in the Declaration that may be inconsistent
with any other provision, or make any other provisions with respect to matters
or questions arising under the Declaration that shall not be inconsistent with
the other provisions of the Declaration, or (ii) to modify, eliminate, or add to
any provisions of the Declaration to such extent as shall be necessary to ensure
that the Trust will be classified as a grantor trust for United States federal
income tax purposes at all times that any Capital Securities and Common
Securities are outstanding or to ensure that the Trust will not be required to
register as an "investment company" under the Investment Company Act, or (iii)
to conform to any change in Rule 3a-7 under the Investment Company Act or
written change in interpretation or application of such Rule 3a-7 by any
legislative body, court, government agency, or regulatory authority which
amendment does not have a material adverse effect on the rights, preferences, or
privileges of the Holders; provided, however, that such action shall not
adversely affect in any material respect the interests of any holder of Capital
Securities or Common Securities, and any amendments of the Declaration shall
become effective when notice thereof is given to the holders of Capital
Securities and Common Securities. The Declaration may also be amended by the
holders of a majority in aggregate Liquidation Amount of the Common Securities
and the Regular Trustee with (i) the consent of holders representing not less
than a majority (based upon Liquidation Amounts) of the outstanding Capital
Securities and (ii) receipt by the Regular Trustees of an opinion of counsel to
the effect that such amendment or the exercise of any power granted to the
Regular Trustees in accordance with such amendment will not affect the Trust's
status as a grantor trust for United States federal income tax purposes or the
Trust's exemption from status as an "investment company" under the Investment
Company Act, provided, that without the consent of each holder of Capital
Securities and Common Securities affected thereby, the Declaration may not be
amended to (i) change the amount or timing of any Distribution on the Capital
Securities and Common Securities or otherwise adversely affect the amount of any
Distribution required to be made in respect of the Capital Securities and Common
Securities as of a specified date, or (ii) restrict the right of a holder of
Capital Securities or Common Securities to institute suit for the enforcement of
any such payment on or after such date.
Any required approval of holders of Capital Securities may be given at
a meeting of holders of Capital Securities convened for such purpose or pursuant
to written consent. The Regular Trustees will cause a notice of any meeting at
which holders of Capital Securities are entitled to vote, or of any matter upon
which action by written consent of such holders is to be taken, to be given to
each holder of record of Capital Securities in the manner set forth in the
Declaration.
No vote or consent of the holders of Capital Securities will be
required for the Trust to redeem and cancel its Capital Securities in accordance
with the Declaration.
Notwithstanding that holders of Capital Securities are entitled to vote
or consent under any of the circumstances described above, any of the Capital
Securities that are owned by the Company, the Declaration Trustees, or any
affiliate of the Company or any Declaration Trustee, shall, for purposes of such
vote or consent, be treated as if they were not outstanding.
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EXPENSES AND TAXES
In the Indenture, the Company, as borrower, has agreed to pay all debts
and other obligations (other than with respect to the Capital Securities) and
all costs and expenses of the Trust (including costs and expenses relating to
the organization of the Trust, the fees and expenses of the Declaration
Trustees, and the costs and expenses relating to the operation of the Trust) and
to pay any and all taxes and all costs and expenses with respect thereto (other
than United States withholding taxes) to which the Trust might become subject.
The Company has also agreed in the Indenture to execute such additional
agreements as may be necessary or desirable to give full effect to the
foregoing.
NOTICES
All notices to holders of Capital Securities shall be validly given if
in writing and mailed by first class mail to them at their respective addresses
in the register of holders of Capital Securities maintained by the registrar of
the Trust and so long as (i) the Capital Securities are listed on the Luxembourg
Stock Exchange, and (ii) the Luxembourg Stock Exchange and the rules of such
Exchange so require, by publication, in a leading newspaper having general
circulation in Luxembourg (which is expected to be the Luxemburger Wort). Any
such notice shall be deemed to have been given on the later of the date of such
publication and the seventh day after so mailed.
REGISTRAR AND TRANSFER AGENT
The Chase Manhattan Bank is the initial registrar and The Chase
Manhattan Bank and Chase Manhattan Bank Luxembourg S.A. are transfer agents for
the Capital Securities. The Company and the Trust shall at all times maintain a
transfer agent in the City of New York and, so long as the Capital Securities
are listed on the Luxembourg Stock Exchange and the Luxembourg Stock Exchange
and the rules of the Luxembourg Stock Exchange so require, a transfer agent in
Luxembourg. Definitive Capital Securities may be presented to the Luxembourg
transfer agent for transfer.
Registration of transfers of Capital Securities will be effected
without charge by or on behalf of the Trust, but the Trust may require payment
of any tax or other governmental charges that may be imposed in connection with
any transfer or exchange. The Trust will not be required (i) to register or
cause to be registered the transfer or exchange of the Capital Securities during
a period beginning at the opening of business 15 days before the day of the
mailing of the relevant notice of redemption and ending at the close of business
on the day of mailing of such notice of redemption or (ii) to register or cause
to be registered the transfer or exchange of any Capital Securities so selected
for redemption, except in the case of any Capital Securities being redeemed in
part, any portion thereof not to be redeemed.
INFORMATION CONCERNING THE PROPERTY TRUSTEE
The Property Trustee, other than during the occurrence and continuance
of a Trust Enforcement Event, undertakes to perform only such duties as are
specifically set forth in the Declaration and, after such Trust Enforcement
Event, must exercise the same degree of care and skill as a prudent person would
exercise or use in the conduct of his or her own affairs. Subject to this
provision, the Property Trustee is under no obligation to exercise any of the
powers vested in it by the Declaration at the request of any holder of Capital
Securities unless it is offered reasonable indemnity against the costs,
expenses, and liabilities that might be incurred thereby. If no Trust
Enforcement Event has occurred and is continuing and the Property Trustee is
required to decide between alternative causes of action, construe ambiguous
provisions in the Declaration, or is unsure of the application of any provision
of the Declaration, and the matter is not one on which holders of Capital
Securities are entitled under the Declaration to vote, then the Property Trustee
may, but shall be under no duty to, take such action as is directed by the
Company and, if not so directed, shall take such action as it deems advisable
and in the best interests of the holders of the Capital Securities and the
Common Securities and will have no liability except for its own bad faith,
negligence, or willful misconduct.
PAYMENT AND PAYING AGENCY
Payments in respect of the Global Capital Securities (as defined
herein) shall be made to DTC, which shall credit the relevant accounts at DTC on
the applicable Distribution Dates or, if the Capital Securities are held in
certificated form, such payments shall be made by check mailed to the address of
the holder entitled thereto as such address shall appear on the register
maintained by the registrar. The paying agent (the "Paying Agent") shall
initially be the Property Trustee and any co-paying agent chosen by the Property
Trustee and acceptable to the Regular Trustees and the Company. Initially,
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Chase Manhattan Bank Luxembourg S.A. will act as co-paying agent. The Company
and the Trust shall at all times and so long as the Capital Securities are
listed on the Luxembourg Stock Exchange, and the Luxembourg Stock Exchange so
requires, maintain a paying agent in Luxembourg. The Paying Agent shall be
permitted to resign as Paying Agent upon 30 days' written notice to the Property
Trustee and the Company. In the event that the Property Trustee shall no longer
be the Paying Agent, the Regular Trustees shall appoint a successor (which shall
be a bank or trust company acceptable to the Regular Trustees and the Company)
to act as Paying Agent.
MERGERS, CONSOLIDATIONS, AMALGAMATIONS, OR REPLACEMENTS OF THE TRUST
The Trust may not merge with or into, consolidate, amalgamate, or be
replaced by, or convey, transfer, or lease its properties and assets
substantially as an entirety to any entity, except as described below or as
otherwise described in the Declaration. The Trust may, at the request of the
Company with the consent of the holders of at least a majority in aggregate
Liquidation Amount of the Capital Securities, merge with or into, consolidate,
amalgamate, be replaced by or convey, transfer, or lease its properties and
assets substantially as an entirety to a trust organized as such under the laws
of any state; provided that (i) such successor entity (if not the Trust) either
(a) expressly assumes all of the obligations of the Trust with respect to the
Capital Securities or (b) substitutes for the Capital Securities other
securities having substantially the same terms as the Capital Securities (the
"Successor Securities") so long as the Successor Securities rank the same as the
Capital Securities rank in priority with respect to distributions and payments
upon liquidation, redemption, and otherwise, (ii) if the Trust is not the
successor entity, the Property Trustee expressly appoints a trustee of such
successor entity possessing the same powers and duties as the Property Trustee
as the holder of the Subordinated Debentures, (iii) such merger, consolidation,
amalgamation, replacement, conveyance, transfer, or lease does not cause the
Capital Securities (including any Successor Securities) to be downgraded by any
nationally recognized statistical rating organization, (iv) such merger,
consolidation, amalgamation, replacement, conveyance, transfer, or lease does
not adversely affect the rights, preferences, and privileges of the holders of
the Capital Securities (including any Successor Securities) in any material
respect, (v) such successor entity has a purpose substantially identical to that
of the Trust, (vi) prior to such merger, consolidation, amalgamation,
replacement, conveyance, transfer, or lease, the Company has received an opinion
from independent counsel to the Trust experienced in such matters to the effect
that (a) such merger, consolidation, amalgamation, replacement, conveyance,
transfer, or lease does not adversely affect the rights, preferences, and
privileges of the holders of the Capital Securities (including any Successor
Securities) in any material respect and (b) following such merger,
consolidation, amalgamation, replacement, conveyance, transfer, or lease, (1)
neither the Trust nor such successor entity will be required to register as an
investment company under the Investment Company Act and (2) the Trust or the
successor entity will continue to be classified as a grantor trust for United
States federal income tax purposes, (vii) the Company or any permitted successor
or assignee owns all of the Common Securities of such successor entity and
guarantees the obligations of such successor entity under the Successor
Securities at least to the extent provided by the Guarantee, and (viii) such
successor entity (if not the Trust) expressly assumes all of the obligations of
the Trust with respect to the Declaration Trustees. Notwithstanding the
foregoing, the Trust shall not, except with the consent of holders of 100% in
aggregate Liquidation Amount of the Capital Securities, consolidate, amalgamate,
merge with or into, be replaced by, or convey, transfer, or lease its properties
and assets substantially as an entirety to any other entity or permit any other
entity to consolidate, amalgamate, merge with or into, or replace it if such
consolidation, amalgamation, merger, replacement, conveyance, transfer, or lease
would cause the Trust or the successor entity to be classified as other than a
grantor trust for United States federal income tax purposes.
MERGER OR CONSOLIDATION OF DECLARATION TRUSTEES
Any corporation into which the Property Trustee, the Delaware Trustee,
or any Regular Trustee may be merged or converted or with which it may be
consolidated, or any corporation resulting from any merger, conversion, or
consolidation to which such Trustee shall be a party, or any corporation
succeeding to all or substantially all the corporate trust business of such
Trustee, shall be the successor of such Trustee under the Declaration, provided
such corporation shall be otherwise qualified and eligible.
GOVERNING LAW
The Declaration and the Capital Securities are governed by, and
construed in accordance with, the laws of the State of Delaware, without regard
to principles of conflict of laws.
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MISCELLANEOUS
1. The CUSIP Number for the Capital Securities represented by the
Global Capital Securities is ___________. The International Securities
Identification Number ("ISIN") for the Capital Securities is_____________.
2. The Capital Securities are listed on the Luxembourg Stock Exchange.
The legal notice relating to the issue of the Capital Securities and the
Articles of Incorporation of the Company were registered prior to the listing
with the Registrar of the District Court in Luxembourg (Greffier en Chef du
Tribunal d'Arrondissement de et a Luxembourg), where such documents are
available for inspection and where copies thereof can be obtained upon request.
As long as the Capital Securities are listed on the Luxembourg Stock Exchange,
the Company will maintain a paying agent and a transfer agent in Luxembourg.
3. Each of the Company and the Trust has obtained all necessary
contents, approvals, and authorizations in connection with the issue and
performance of the Capital Securities, except as disclosed in this Prospectus.
4. Except as disclosed in this Prospectus, there has been no material
adverse change in the financial position or prospects of the Company or any of
its subsidiaries since March 31, 1997.
5. Other than as referred to elsewhere in this Prospectus, neither the
Company nor any of its subsidiaries is involved in any litigation or arbitration
proceedings that may have, or have had during the 12 months preceding the date
of this document, a significant effect on the financial position of the Company
or any of its subsidiaries, nor is the Company or any of its subsidiaries aware
that any such proceedings are pending or threatened.
6. A copy of the Articles of Association of the Company and copies of
the Indenture, the Declaration, and the Guarantee, will, for so long as the
Capital Securities are listed on the Luxembourg Stock Exchange, be available for
inspection during usual business hours on any weekday (except public holidays)
at the offices of the transfer agent in Luxembourg. As long as any Capital
Securities remain outstanding, copies of the latest Annual Report on Form 10-K
of the Company, as at December 31 in each year, and the Quarterly Reports on
Form 10-Q, as at March 31, June 30, and September 30 in each year, may be
obtained (free of charge) at the offices of the Company specified above and at
the specified offices of the paying agents. Other than Quarterly Reports on Form
10-Q, the Company does not publish interim or other financial statements.
7. Approval for the issuance of the Capital Securities was granted by
the Board of Directors of the Company on January 22, 1997.
8. The Old Capital Securities were initially offered to investors at
98.623% of the Liquidation Amount per Capital Security.
9. The Company has taken all reasonable care to insure that the
information contained in this Prospectus in relation to the Company and the
Capital Securities is true and accurate in all material respects and that in
relation to the Company and the Capital Securities, there are no material facts
the omission of which would make misleading any statement herein. The Company
accepts responsibility for the information contained in this Prospectus.
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DESCRIPTION OF SUBORDINATED DEBENTURES
The Old Subordinated Debentures were issued, and the New Subordinated
Debentures will be issued, as a separate series under the Indenture. The
Indenture has been qualified under the Trust Indenture Act. This summary of
certain terms and provisions of the Subordinated Debentures and the Indenture
does not purport to be complete and is subject to, and is qualified in its
entirety by reference to, the Indenture.
GENERAL
Concurrently with the issuance of the Old Capital Securities, the Trust
invested the proceeds thereof and the consideration paid by the Company for the
Common Securities in the Old Subordinated Debentures issued by the Company. The
Old Subordinated Debentures were issued in an aggregate principal amount equal
to the aggregate Liquidation Amount of the Old Capital Securities and the Common
Securities. Pursuant to the Exchange Offer, the Company will exchange the Old
Subordinated Debentures for the New Subordinated Debentures as soon as
practicable after the date hereof. It is anticipated that, until the
liquidation, if any, of the Trust, each Subordinated Debenture will be held in
the name of the Property Trustee in trust for the benefit of the holders of the
Capital Securities and the Common Securities. The Subordinated Debentures bear
interest at a variable annual rate equal to LIBOR plus .70% on the principal
amount thereof, payable quarterly in arrears on the last day of January, April,
July, and October of each year (each, an "Interest Payment Date"), commencing
April 30, 1997, to the person in whose name each Subordinated Debenture is
registered, subject to certain exceptions, at the close of business on the
fifteenth day of the month of the relevant Interest Payment Date. The final
Interest Payment Date will be February 1, 2027, and interest will accrue from
the last Interest Payment Date prior to such date up to and including January
31, 2027. The amount of interest payable for any period will be computed on the
basis of the actual number of days elapsed in a year of twelve 30-day months. In
the event that any date on which interest is payable on the Subordinated
Debentures is not a Business Day, then payment of the interest payable on such
date will be made on the next succeeding day that is a Business Day (and without
any interest or other payment in respect of any such delay), with the same force
and effect as if made on the date such payment was originally payable. Accrued
interest that is not paid on the applicable Interest Payment Date will bear
additional interest on the amount thereof (to the extent permitted by law) at a
variable annual rate equal to LIBOR plus .70%, compounded quarterly. The term
"interest" as used herein shall include quarterly interest payments, interest on
quarterly interest payments not paid on the applicable Interest Payment Date,
and any additional interest, as applicable.
Interest on the Subordinated Debentures began accruing from January 31, 1997.
The Subordinated Debentures mature on February 1, 2027.
The Subordinated Debentures are unsecured and rank junior and
subordinate in right of payment to all Indebtedness of the Company to the extent
described herein. The Indenture does not limit the incurrence or issuance of
other secured or unsecured debt of the Company, whether under the Indenture or
any existing or other indenture that the Company may enter into in the future or
otherwise. See "-- Subordination."
The Indenture does not limit the aggregate principal amount of
Subordinated Debentures that may be issued thereunder.
The general provisions of the Indenture do not afford holders of the
Subordinated Debentures protection in the event of a highly leveraged or other
transaction involving the Company that may adversely affect holders of the
Subordinated Debentures.
INTEREST
The Chase Manhattan Bank, as Calculation Agent (the "Calculation
Agent"), will calculate the interest rate for each quarterly interest period
based on LIBOR determined as of two "London Business Days" (defined as any day,
other than a Saturday or Sunday, on which banks are open for business in London)
prior to the first day of such interest period (each, a "Determination Date").
"LIBOR" means, with respect to a quarterly interest period relating to an
Interest Payment Date (in the following order of priority):
(i) the rate (expressed as a percentage per annum) for
Eurodollar deposits having a three-month maturity that appears on
Telerate Page 3750 as of 11:00 a.m. (London time) on the related
Determination Date;
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(ii) if such rate does not appear on Telerate Page 3750 as
of 11:00 a.m. (London time) on the related Determination Date, LIBOR
will be the arithmetic mean (if necessary rounded upwards to the
nearest whole multiple of .00001%) of the rates (expressed as
percentages per annum) for Eurodollar deposits having a three-month
maturity that appear on Reuters Monitor Money Rates Page LIBO ("Reuters
Page LIBO") as of 11:00 a.m. (London time) on such Determination Date;
(iii) if such rate does not appear on Reuters Page LIBO as of
11:00 a.m. (London time) on the related Determination Date, the
Calculation Agent will request the principal London offices of four
leading banks in the London interbank market to provide such banks'
offered quotations (expressed as percentages per annum) to prime banks
in the London interbank market for Eurodollar deposits having a
three-month maturity as of 11:00 a.m. (London time) on such
Determination Date. If at least two quotations are provided, LIBOR will
be the arithmetic mean (if necessary rounded upwards to the nearest
whole multiple of .00001%) of such quotations;
(iv) if fewer than two such quotations are provided as
requested in clause (iii) above, the Calculation Agent will request
four major New York City banks to provide such banks' offered
quotations (expressed as percentages per annum) to leading European
banks for loans in Eurodollars as of 11:00 a.m. (London time) on such
Determination Date. If at least two such quotations are provided, LIBOR
will be the arithmetic mean (if necessary rounded upwards to the
nearest whole multiple of .00001%) of such quotations; and
(v) if fewer than two such quotations are provided as
requested in clause (iv) above, LIBOR will be LIBOR determined with
respect to the interest period immediately preceding such current
interest period.
If the rate for Eurodollar deposits having a three-month maturity that
initially appears on Telerate Page 3750 or Reuters Page LIBO, as the case may
be, as of 11:00 a.m. (London time) on the related Determination Date is
superseded on Telerate Page 3750 or Reuters Page LIBO, as the case may be, by a
corrected rate before 12:00 noon (London time) on such Determination Date, the
corrected rate as so substituted on the applicable page will be the applicable
LIBOR for such Determination Date.
Absent manifest error, the Calculation Agent's determination of LIBOR
and its calculation of the applicable interest rate for each interest period
will be final and binding. Investors may obtain the interest rates for the
current and preceding interest period by writing or calling Corporate Trust
Administration at the Calculation Agent at The Chase Manhattan Bank, 450 West
33rd Street, New York, New York 10001.
OPTION TO EXTEND INTEREST PAYMENT PERIOD
So long as no Indenture Event of Default has occurred and is
continuing, the Company has the right under the Indenture to defer the payment
of interest at any time or from time to time for a period not exceeding 20
consecutive quarters with respect to each Extension Period, provided that no
Extension Period may extend beyond the Stated Maturity of the Subordinated
Debentures. At the end of such Extension Period, the Company must pay all
interest then accrued and unpaid (together with interest thereon at a variable
annual rate equal to LIBOR plus .70%, compounded quarterly, to the extent
permitted by applicable law). During an Extension Period, interest will continue
to accrue and holders of Subordinated Debentures (or holders of Capital
Securities while the Capital Securities are outstanding) will be required to
accrue interest income (as OID) for United States federal income tax purposes.
See "Certain United States Federal Income Tax Consequences -- Interest Income
and Original Issue Discount."
During any such Extension Period, the Company may not, and may not
permit any subsidiary of the Company to, (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire, or make a liquidation payment
with respect to, any of the Company's capital stock or (ii) make any payment of
principal, interest, or premium, if any, on or repay, repurchase, or redeem any
debt securities of the Company that rank pari passu with or junior in interest
to the Subordinated Debentures or make any guarantee payments with respect to
any guarantee by the Company of the debt securities of any subsidiary of the
Company if such guarantee ranks pari passu with or junior in interest to the
Subordinated Debentures (other than (a) repurchases, redemptions, or other
acquisitions of shares of capital stock of the Company in connection with any
employment contract, benefit plan, or other similar arrangement with or for the
benefit of any one or more employees, officers, directors, or consultants, or in
connection with a dividend reinvestment or stockholder stock purchase plan, (b)
as a result of an exchange or conversion of any class or series of the Company's
capital stock (or any capital stock of a subsidiary of the Company) for any
other class or series of the Company's capital stock or of any class or series
of the Company's indebtedness for any class or series of the Company's capital
stock, (c)
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the purchase of fractional interests in shares of the Company's capital stock
pursuant to the conversion or exchange provisions of such capital stock or the
security being converted or exchanged, (d) any declaration of a dividend in
connection with any stockholders' rights plan, or the issuance of rights, stock,
or other property under any stockholders' rights plan, or the redemption or
repurchase of rights pursuant thereto, or (e) any dividend in the form of stock,
warrants, options, or other rights where the dividend stock or the stock
issuable upon exercise of such warrants, options, or other rights is the same
stock as that on which the dividend is being paid (or ranks pari passu with or
junior to such stock)). Prior to the termination of any such Extension Period,
the Company may further extend the Extension Period, provided that no Extension
Period may exceed 20 consecutive quarters or extend beyond the Stated Maturity
of the Subordinated Debentures. Upon the termination of any such Extension
Period and the payment of all amounts then due on any Interest Payment Date, the
Company may elect to begin a new Extension Period subject to the above
requirements. No interest shall be due and payable during an Extension Period,
except at the end thereof. The Company must give the Property Trustee, the
Regular Trustees, and the Indenture Trustee notice of its election of such
Extension Period not less than one Business Day prior to such record date. The
Property Trustee shall give notice of the Company's election to begin a new
Extension Period to the holders of the Capital Securities.
REDEMPTION
The Subordinated Debentures are not redeemable prior to February 1,
2007, unless a Special Event has occurred. The Subordinated Debentures are
redeemable prior to maturity at the option of the Company, subject to the
receipt of any necessary prior approval of the Federal Reserve, (i) on or after
February 1, 2007, in whole or in part at any time, at a redemption price equal
to the principal amount of the Subordinated Debentures so redeemed plus accrued
and unpaid interest, if any, to the date of redemption, or (ii) at any time in
whole (but not in part), within 90 days of the occurrence of a Special Event, at
such redemption price.
If the Subordinated Debentures are redeemed, the Trust must redeem
Trust Securities having an aggregate Liquidation Amount equal to the aggregate
principal amount of Subordinated Debentures so redeemed. See "-- Description of
Capital Securities -- Redemption -- Mandatory Redemption."
Notice of any redemption will be mailed at least 30 days but not more
than 60 days before the redemption date to each holder of Subordinated
Debentures to be redeemed at its registered address. Unless the Company defaults
in payment of the redemption price, on and after the redemption date interest
will cease to accrue on such Subordinated Debentures or portions thereof called
for redemption.
CERTAIN COVENANTS OF THE COMPANY
The Company has covenanted in the Indenture that if and so long as the
Trust is the holder of all Subordinated Debentures, the Company, as borrower,
will pay to the Trust all fees and expenses related to the Trust and the
offering of the Capital Securities and will pay, directly or indirectly, all
ongoing costs, expenses, and liabilities of the Trust (including any taxes,
duties, assessments, or governmental charges of whatever nature (other than
withholding taxes) imposed by the United States or any domestic taxing authority
upon the Trust but excluding obligations under the Capital Securities).
The Company also covenanted that it will not, and will not permit any
subsidiary of the Company to, (i) declare or pay any dividends or distributions
on, or redeem, purchase, acquire, or make a liquidation payment with respect to,
any of the Company's capital stock or (ii) make any payment of principal,
interest, or premium, if any, on or repay or repurchase or redeem any debt
securities of the Company that rank pari passu with or junior in interest to the
Subordinated Debentures or make any guarantee payments with respect to any
guarantee by the Company of the debt securities of any subsidiary of the Company
if such guarantee ranks pari passu with or junior in interest to the
Subordinated Debentures (other than (a) repurchases, redemptions, or other
acquisitions of shares of capital stock of the Company in connection with any
employment contract, benefit plan, or other similar arrangement with or for the
benefit of any one or more employees, officers, directors, or consultants, or in
connection with a dividend reinvestment or stockholder stock purchase plan, (b)
as a result of an exchange or conversion of any class or series of the Company's
capital stock (or any capital stock of a subsidiary of the Company) for any
other class or series of the Company's capital stock or of any class or series
of the Company's indebtedness for any class or series of the Company's capital
stock, (c) the purchase of fractional interests in shares of the Company's
capital stock pursuant to the conversion or exchange provisions of such capital
stock or the security being converted or exchanged, (d) any declaration of a
dividend in connection with any stockholders' rights plan, or the issuance of
rights, stock, or other property under any stockholders' rights plan, or the
redemption or repurchase of rights pursuant thereto, or (e) any dividend in the
form of stock, warrants,
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options, or other rights where the dividend stock or the stock issuable upon
exercise of such warrants, options, or other rights is the same stock as that on
which the dividend is being paid (or ranks pari passu with or junior to such
stock)) if at such time (x) there shall have occurred any event of which the
Company has actual knowledge that (i) with the giving of notice or the lapse of
time, or both, would constitute an Indenture Event of Default with respect to
Subordinated Debentures and (ii) in respect of which the Company shall not have
taken reasonable steps to cure, (y) the Company shall be in default with respect
to its payment of any obligations under the Guarantee or (z) the Company shall
have given notice of its election of an Extension Period as provided in the
Indenture and shall not have rescinded such notice, or such Extension Period, or
any extension thereof, shall be continuing.
SUBORDINATION
In the Indenture, the Company has covenanted and agreed that any
Subordinated Debentures issued thereunder will be subordinated and junior in
right of payment to all Indebtedness to the extent provided in the Indenture.
Upon any payment or distribution of assets of the Company upon any liquidation,
dissolution, winding-up, reorganization, assignment for the benefit of
creditors, marshaling of assets, or any bankruptcy, insolvency, debt
restructuring, or similar proceedings in connection with any insolvency or
bankruptcy proceeding of the Company, the holders of Indebtedness will first be
entitled to receive payment in full of the principal of and premium, if any, and
interest, if any, on such Indebtedness before the holders of Subordinated
Debentures or the Property Trustee on behalf of the holders of Capital
Securities will be entitled to receive or retain any payment in respect of the
principal of and premium, if any, or interest, if any, on the Subordinated
Debentures; provided, however, that holders of Indebtedness shall not be
entitled to receive payment of any such amounts to the extent that such holders
would be required by the subordination provisions of such Indebtedness to pay
such amounts over to the obligees on trade accounts payable or other liabilities
arising in the ordinary course of the Company's business.
In the event of the acceleration of the maturity of any Subordinated
Debentures, the holders of all Indebtedness outstanding at the time of such
acceleration will first be entitled to receive payment in full of all amounts
then due thereon (including any amounts due upon acceleration thereof) before
the holders of Subordinated Debentures will be entitled to receive or retain any
payment in respect of the principal of and premium, if any, or interest, if any,
on the Subordinated Debentures; provided, however, that holders of Indebtedness
shall not be entitled to receive payment of any such amounts to the extent that
such holders would be required by the subordination provisions of such
Indebtedness to pay such amounts over to the obligees on trade accounts payable
or other liabilities arising in the ordinary course of the Company's business.
No payments on account of principal (or premium, if any) or interest,
if any, in respect of the Subordinated Debentures may be made if there shall
have occurred and be continuing a default in any payment with respect to
Indebtedness, or an event of default with respect to any Indebtedness resulting
in the acceleration of the maturity thereof, or if any judicial proceeding shall
be pending with respect to any such default.
"Indebtedness" means, whether recourse is to all or a portion of the
assets of the Company and whether or not contingent, (i) every obligation of the
Company for money borrowed; (ii) every obligation of the Company evidenced by
bonds, debentures, notes, or other similar instruments, including obligations
incurred in connection with the acquisition of property, assets, or businesses;
(iii) every reimbursement obligation of the Company with respect to letters of
credit, bankers' acceptances, or similar facilities issued for the account of
the Company; (iv) every obligation of the Company issued or assumed as the
deferred purchase price of property or services (but excluding trade accounts
payable or accrued liabilities arising in the ordinary course of business); (v)
every capital lease obligation of the Company; (vi) every obligation of the
Company for claims (as defined in Section 101(4) of the United States Bankruptcy
Code of 1978, as amended) in respect of derivative products such as interest and
foreign exchange rate contracts, commodity contracts, and similar arrangements;
and (vii) every obligation of the type referred to in clauses (i) through (vi)
of another person and all dividends of another person the payment of which, in
either case, the Company has guaranteed or is responsible or liable for,
directly or indirectly, as obligor or otherwise; provided that "Indebtedness"
shall not include (i) any obligations which, by their terms, are expressly
stated to rank pari passu in right of payment with, or to not be superior in
right of payment to, the Subordinated Debentures, (ii) any Indebtedness of the
Company which when incurred was without recourse to the Company, (iii) any
Indebtedness of the Company to any of its subsidiaries, (iv) Indebtedness to any
employee of the Company, or (v) any Indebtedness in respect of debt securities
issued to any trust, or a trustee of such trust, partnership, or other entity
affiliated with the Company that is a financing entity of the Company in
connection with the issuance by such financing entity of securities that are
similar to the Capital Securities.
The Indenture places no limitation on the amount of additional
Indebtedness that may be incurred by the Company or any indebtedness or other
liabilities that may be incurred by the Company's subsidiaries. As of March 31,
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1997, Indebtedness of the Company aggregated approximately $369.3 million to
which the Subordinated Debentures would be effectively subordinated.
INDENTURE EVENTS OF DEFAULT
The Indenture provides that any one or more of the following described
events with respect to the Subordinated Debentures that has occurred and is
continuing constitutes an "Indenture Event of Default" with respect to the
Subordinated Debentures:
(i) failure for 30 days to pay any interest on the
Subordinated Debentures when due (subject to the deferral of any due
date in the case of an Extension Period); or
(ii) failure to pay any principal on the Subordinated
Debentures when due whether at maturity, upon redemption by declaration
or otherwise; or
(iii) failure to observe or perform in any material respect
any other covenant contained in the Indenture for 90 days after written
notice to the Company from the Indenture Trustee or the holders of at
least 25% in aggregate outstanding principal amount of outstanding
Subordinated Debentures; or
(iv) certain events in bankruptcy, insolvency, or
reorganization of the Company.
The holders of a majority in aggregate outstanding principal amount of
Subordinated Debentures have the right to direct the time, method, and place of
conducting any proceeding for any remedy available to the Indenture Trustee. The
Indenture Trustee or the holders of not less than 25% in aggregate outstanding
principal amount of Subordinated Debentures may declare the principal due and
payable immediately upon an Indenture Event of Default, and, should the
Indenture Trustee or such holders of such Subordinated Debentures fail to make
such declaration, the holders of at least 25% in aggregate Liquidation Amount of
the Capital Securities shall have such right. The holders of a majority in
aggregate outstanding principal amount of Subordinated Debentures may annul such
declaration and waive the default if the default (other than the non-payment of
the principal of Subordinated Debentures which has become due solely by such
acceleration) has been cured and a sum sufficient to pay all matured
installments of interest and principal due otherwise than by acceleration has
been deposited with the Indenture Trustee, and should the holders of such
Subordinated Debentures fail to annul such declaration and waive such default,
the holders of a majority in aggregate Liquidation Amount of the Capital
Securities shall have such right.
The holders of a majority in aggregate outstanding principal amount of
the Subordinated Debentures affected thereby may, on behalf of the holders of
all the Subordinated Debentures, waive any past default, except a default in the
payment of principal or interest (unless such default has been cured and a sum
sufficient to pay all matured installments of interest and principal due
otherwise than by acceleration has been deposited with the Indenture Trustee) or
a default in respect of a covenant or provision which under the Indenture cannot
be modified or amended without the consent of the holder of each outstanding
Subordinated Debenture, and should the holders of such Subordinated Debentures
fail to waive such default, the holders of a majority in aggregate Liquidation
Amount of the Capital Securities shall have such right. The Company is required
to file annually with the Indenture Trustee a certificate as to whether or not
the Company is in compliance with all the conditions and covenants applicable to
it under the Indenture.
In case an Indenture Event of Default shall occur and be continuing,
the Property Trustee will have the right to declare the principal of and the
interest on such Subordinated Debentures and any other amounts payable under the
Indenture to be forthwith due and payable and to enforce its other rights as a
creditor with respect to such Subordinated Debentures.
ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF CAPITAL SECURITIES
If an Indenture Event of Default has occurred and is continuing and
such event is attributable to the failure of the Company to pay interest or
principal on the Subordinated Debentures on the date such interest or principal
is otherwise payable, a holder of Capital Securities may institute a Direct
Action for payment. The Company may not amend the Indenture to remove the
foregoing right to bring a Direct Action without the prior written consent of
the holders of all of the Capital Securities. Notwithstanding any payment made
to such holder of Capital Securities by the Company in connection with a Direct
Action, the Company shall remain obligated to pay such principal of or interest
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on the Subordinated Debentures held by the Trust or the Property Trustee and the
Company shall be subrogated to the rights of the holder of such Capital
Securities with respect to payments on the Capital Securities to the extent of
any payments made by the Company to such holder in any Direct Action. Except as
otherwise described herein, the holders of Capital Securities will not be able
to exercise directly any other remedy available to the holders of the
Subordinated Debentures.
CONSOLIDATION, MERGER, SALE OF ASSETS, AND OTHER TRANSACTIONS
The Indenture provides that the Company shall not consolidate with or
merge into any other Person (as defined in the Indenture) or convey, transfer,
or lease its properties and assets substantially as an entirety to any Person,
unless (i) in case the Company consolidates with or merges into another Person
or conveys, transfers, or leases its properties and assets substantially as an
entirety to any Person, the successor Person is organized under the laws of the
United States or any state or the District of Columbia, and such successor
Person expressly assumes the Company's obligations on the Subordinated
Debentures issued under the Indenture; (ii) immediately after giving effect
thereto, no Indenture Event of Default, and no event which, after notice or
lapse of time or both, would become an Indenture Event of Default, shall have
happened and be continuing; (iii) if at the time any Capital Securities are
outstanding, such transaction is permitted under the Declaration and Guarantee
and does not give rise to any breach or violation of the Declaration or
Guarantee; (iv) any such lease shall provide that it will remain in effect so
long as any Subordinated Debentures are outstanding; and (v) certain other
conditions prescribed in the Indenture are met.
MODIFICATION OF INDENTURE
From time to time the Company and the Indenture Trustee may, without
the consent of the holders of the Subordinated Debentures, amend, waive, or
supplement the Indenture for specified purposes, including, among other things,
curing ambiguities, defects, or inconsistencies (provided that any such action
does not materially adversely affect the interest of the holders of Subordinated
Debentures), qualifying, or maintaining the qualification of, the Indenture
under the Trust Indenture Act and adding to, deleting from, or revising the
terms of the Subordinated Debentures to provide for transfer procedures and
restrictions substantially similar to those applicable to the Capital Securities
(for purposes of assuring that no registration of Subordinated Debentures is
required under the Securities Act). The Indenture contains provisions permitting
the Company and the Indenture Trustee, with the consent of the holders of not
less than a majority in principal amount of outstanding Subordinated Debentures
affected, to modify the Indenture in a manner affecting the rights of the
holders of such Subordinated Debentures; provided that no such modification may,
without the consent of the holder of each outstanding Subordinated Debentures so
affected, (i) change the stated maturity of Subordinated Debentures, or reduce
the principal amount thereof, or reduce the rate or extend the time of payment
of interest thereon (except such extension as is contemplated hereby) or (ii)
reduce the percentage of principal amount of Subordinated Debentures the holders
of which are required to consent to any such modification of the Indenture,
provided that, so long as any Capital Securities remain outstanding, no such
modification may be made that adversely affects the holders of such Capital
Securities in any material respect, and no termination of the Indenture may
occur, and no waiver of any Indenture Event of Default or compliance with any
covenant under the Indenture may be effective, without the prior consent of the
holders of at least a majority of the aggregate Liquidation Amount of the
outstanding Capital Securities unless and until the principal of the
Subordinated Debentures and all accrued and unpaid interest thereon have been
paid in full and certain other conditions are satisfied.
DEFEASANCE AND DISCHARGE
The Indenture provides that the Company, at the Company's option: (a)
will be discharged from any and all obligations in respect of the Subordinated
Debentures (except for certain obligations to register the transfer or exchange
of Subordinated Debentures, replace stolen, lost, or mutilated Subordinated
Debentures, maintain paying agencies, and hold moneys for payment in trust) or
(b) need not comply with certain restrictive covenants of the Indenture
(including that described in the second paragraph under "-- Certain Covenants of
the Company" as defined in the Indenture), in each case if the Company deposits,
in trust with the Indenture Trustee, money or U.S. Government Obligations which
through the payment of interest thereon and principal thereof in accordance with
their terms will provide money, in an amount sufficient to pay all the principal
of, and interest and premium, if any, on the Subordinated Debentures on the
dates such payments are due in accordance with the terms of such Subordinated
Debentures. To exercise any such option, the Company is required to deliver to
the Indenture Trustee an opinion of counsel to the effect that the deposit and
related defeasance would not cause the holders of the Subordinated Debentures to
recognize income, gain, or loss for United States federal income tax purposes
and, in the case of a discharge pursuant to clause (a), such opinion shall be
accompanied by a
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private letter ruling to the effect received by the Company from the United
States Internal Revenue Service or revenue ruling pertaining to a comparable
form of transaction to such effect published by the United States Internal
Revenue Service.
DISTRIBUTIONS OF SUBORDINATED DEBENTURES; BOOK-ENTRY ISSUANCE
Under certain circumstances involving the termination of the Trust,
Subordinated Debentures may be distributed to the holders of the Capital
Securities in liquidation of the Trust after satisfaction of liabilities to
creditors of the Trust as provided by applicable law. If distributed to holders
of Capital Securities in liquidation, the Subordinated Debentures will initially
be issued in the form of global securities and certificated securities. DTC, or
any successor depositary, will act as depositary for such global securities. It
is anticipated that the depositary arrangements for and certain restrictions
with respect to such global securities would be substantially identical to those
in effect for the Capital Securities. For a description of global securities and
certificated securities, see "Book-Entry Issuance."
There can be no assurance as to the market price of any Subordinated
Debentures that may be distributed to the holders of Capital Securities.
PAYMENT AND PAYING AGENTS
The Company initially will act as Paying Agent with respect to the
Subordinated Debentures except that, if the Subordinated Debentures are
distributed to the holders of the Capital Securities in liquidation of such
holders' interests in the Trust, the Indenture Trustee will act as the Paying
Agent. The Company at any time may designate additional Paying Agents or rescind
the designation of any Paying Agent or approve a change in the office through
which any Paying Agent acts, except that the Company will be required to
maintain a Paying Agent at the place of payment.
Any moneys deposited with the Indenture Trustee or any Paying Agent, or
then held by the Company in trust, for the payment of the principal of and
premium, if any, or interest on any Subordinated Debentures and remaining
unclaimed for one year after such principal and premium, if any, or interest has
become due and payable shall, at the request of the Company, be repaid to the
Company and the holder of such Subordinated Debentures shall thereafter look, as
a general unsecured creditor, only to the Company for payment thereof.
GOVERNING LAW
The Indenture and the Subordinated Debentures are governed by and
construed in accordance with the laws of the State of New York.
INFORMATION CONCERNING THE INDENTURE TRUSTEE
The Indenture Trustee has and is subject to all the duties and
responsibilities specified with respect to an indenture trustee under the Trust
Indenture Act. Subject to such provisions, the Indenture Trustee is under no
obligation to exercise any of the powers vested in it by the Indenture at the
request of any holder of Subordinated Debentures, unless offered reasonable
indemnity by such holder against the costs, expenses, and liabilities which
might be incurred thereby. The Indenture Trustee is not required to expend or
risk its own funds or otherwise incur personal financial liability in the
performance of its duties if the Indenture Trustee reasonably believes that
repayment or adequate indemnity is not reasonably assured to it.
DESCRIPTION OF GUARANTEE
The Old Guarantee was executed and delivered by the Company
concurrently with the issuance by the Trust of the Old Capital Securities for
the benefit of the holders from time to time of such Old Capital Securities. As
soon as practicable after the date hereof, the Old Guarantee will be exchanged
by the Company for the New Guarantee. The New Guarantee has been qualified under
the Trust Indenture Act. The Chase Manhattan Bank is the Guarantee Trustee under
the Guarantee. This summary of certain provisions of the Guarantee does not
purport to be complete and is
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subject to, and qualified in its entirety by reference to, all of the provisions
of the Guarantee, including the definitions therein of certain terms. The
Guarantee Trustee will hold the Guarantee for the benefit of the holders of the
Capital Securities.
GENERAL
The Company has agreed (and under the New Guarantee will agree) to pay
in full on a subordinated basis, to the extent set forth in the Guarantee and
described herein, the Guarantee Payments (as defined below) to the holders of
the Capital Securities, as and when due, regardless of any defense, right of
set-off, or counterclaim that the Trust may have or assert other than the
defense of payment. The following payments with respect to the Capital
Securities, to the extent not paid by or on behalf of the Trust (the "Guarantee
Payments"), will be subject to the Guarantee: (i) any accumulated and unpaid
Distributions required to be paid on the Capital Securities, to the extent that
the Trust has sufficient funds available therefor at the time, (ii) the
redemption price with respect to any Capital Securities called for redemption,
to the extent that the Trust has sufficient funds available therefor at such
time, or (iii) upon a voluntary or involuntary dissolution, winding up, or
liquidation of the Trust (unless the Subordinated Debentures are distributed to
holders of the Capital Securities), the lesser of (a) the aggregate Liquidation
Amount of the Capital Securities and all accrued and unpaid Distributions
thereon to the date of payment and (b) the amount of assets of the Trust
remaining available for distribution to holders of Capital Securities. The
Company's obligation to make a Guarantee Payment may be satisfied by direct
payment of the required amounts by the Company to the holders of the applicable
Capital Securities or by causing the Trust to pay such amounts to such holders.
The Guarantee is an irrevocable guarantee on a subordinated basis of
the Trust's obligations under the Capital Securities, but will apply only to the
extent that the Trust has sufficient funds available to make such payments.
If the Company does not make interest payments on the Subordinated
Debentures held by the Trust, the Trust will not be able to pay Distributions on
the Capital Securities and will not have funds legally available therefor. The
Guarantee will rank subordinate and junior in right of payment to all
Indebtedness of the Company to the same extent as the Subordinated Debenture.
See "--Status of the Guarantee." The Guarantee does not limit the incurrence or
issuance of other secured or unsecured debt of the Company, whether under the
Indenture or any existing or other indenture that the Company may enter into in
the future or otherwise.
The Company has, through the Guarantee, the Subordinated Debentures,
and the Indenture, taken together, fully and unconditionally guaranteed all of
the Trust's obligations under the Capital Securities. No single document
standing alone or operating in conjunction with fewer than all of the other
documents constitutes such guarantee. It is only the combined operation of these
documents that has the effect of providing a full and unconditional guarantee of
the Trust's obligations under the Capital Securities. See "Relationship Among
the Capital Securities, the Subordinated Debentures, and the Guarantee."
STATUS OF THE GUARANTEE
The Guarantee constitutes an unsecured obligation of the Company and
ranks subordinate and junior in right of payment to all Indebtedness of the
Company to the same extent as the Subordinated Debenture. The Guarantee does not
place a limitation on the amount of additional Indebtedness that may be incurred
by the Company.
The Guarantee constitutes a guarantee of payment and not of collection
(i.e., the guaranteed party may institute a legal proceeding directly against
the Guarantor to enforce its rights under the Guarantee without first
instituting a legal proceeding against any other person or entity). The
Guarantee is held by the Guarantee Trustee for the benefit of the holders of the
Capital Securities. The Guarantee will not be discharged except by payment of
the Guarantee Payments in full to the extent not paid by the Trust or upon
distribution of the Subordinated Debentures to the holders of the Capital
Securities in exchange for all of the Capital Securities.
AMENDMENTS AND ASSIGNMENT
Except with respect to any changes that do not materially adversely
affect the rights of holders of the Capital Securities (in which case no vote
will be required), the Guarantee may not be amended without the prior approval
of the holders of not less than a majority of the aggregate Liquidation Amount
of the outstanding Capital Securities. The manner of obtaining any such approval
is as set forth under "-- Description of Capital Securities -- Voting Rights;
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Amendment of the Declaration." All guarantees and agreements contained in the
Guarantee shall bind the successors, assigns, receivers, trustees, and
representatives of the Company and shall inure to the benefit of the registered
holders of the Capital Securities then outstanding.
EVENTS OF DEFAULT
An event of default under the Guarantee will occur upon the failure of
the Company to perform any of its payment or other obligations thereunder. The
holders of a majority in aggregate Liquidation Amount of the Capital Securities
have the right to direct the time, method, and place of conducting any
proceeding for any remedy available to the Guarantee Trustee in respect of the
Guarantee or to direct the exercise of any trust or power conferred upon the
Guarantee Trustee under the Guarantee.
Any holder of the Capital Securities may institute a legal proceeding
directly against the Company to enforce its rights under the Guarantee without
first instituting a legal proceeding against the Trust, the Guarantee Trustee,
or any other person or entity.
The Company, as guarantor, is required to file annually with the
Guarantee Trustee a certificate as to whether or not the Company is in
compliance with all the conditions and covenants applicable to it under the
Guarantee.
INFORMATION CONCERNING THE GUARANTEE TRUSTEE
The Guarantee Trustee, other than during the occurrence and continuance
of a default by the Company in performance of the Guarantee, undertakes to
perform only such duties as are specifically set forth in the Guarantee and,
after default with respect to the Guarantee, must exercise the same degree of
care and skill as a prudent person would exercise or use in the conduct of his
or her own affairs. Subject to this provision, the Guarantee Trustee is under no
obligation to exercise any of the powers vested in it by the Guarantee at the
request of any holder of any Capital Security unless it is offered reasonable
indemnity against the costs, expenses, and liabilities that might be incurred
thereby.
TERMINATION OF THE GUARANTEE
The Guarantee will terminate and be of no further force and effect upon
full payment of the Redemption Price of all of the Capital Securities, upon full
payment of the amounts payable upon liquidation of the Trust, or upon
distribution of Subordinated Debentures to the holders of the Capital Securities
in exchange for all of the Capital Securities. The Guarantee will continue to be
effective or will be reinstated, as the case may be, if at any time any holder
of the Capital Securities must restore payment of any sums paid under the
Capital Securities or the Guarantee.
GOVERNING LAW
The Guarantee is governed by and construed in accordance with the laws
of the State of New York.
DESCRIPTION OF OLD SECURITIES
The terms of the Old Securities are identical in all material respect
to the New Securities, except that (i) the Old Securities have not been
registered under the Securities Act, are subject to certain restrictions on
transfer, and are entitled to certain rights under the Registration Rights
Agreement (which rights will terminate upon consummation of the Exchange Offer,
except under limited circumstances); (ii) the New Capital Securities will not
provide for any increase in the distribution rate thereon; and (iii) the New
Subordinated Debentures will not provide for any increase in the interest rate
thereon. The Old Securities provide that, in the event that the Exchange Offer
is not consummated on or prior to _________, 1997, or, in certain limited
circumstances, in the event a shelf registration statement (the "Shelf
Registration Statement") with respect to the resale of the Old Capital
Securities is not filed with the Commission on or prior to 150 days after such
filing obligation arises and is not declared effective on or prior to 180 days
after such obligation arises, then interest will accrue (in addition to the
interest rate on the Subordinated Debentures) at the rate of 0.25% per annum on
the principal amount of the Subordinated Debentures, and Distributions will
accrue (in addition
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to the stated Distribution rate on the Capital Securities) at the rate of 0.25%
per annum on the Liquidation Amount of the Capital Securities, for the period
from the occurrence of such event until such time as the Exchange Offer is
consummated or any required Shelf Registration Statement is effective. The New
Securities are not, and upon consummation of the Exchange Offer the Old
Securities will not be, entitled to any such additional interest or
Distributions. Accordingly, holders of Old Capital Securities should review the
information set forth under "Risk Factors -- Certain Consequences of Failure to
Exchange Old Capital Securities" and "Description of New Securities."
RELATIONSHIP AMONG THE CAPITAL SECURITIES,
THE SUBORDINATED DEBENTURES, AND THE GUARANTEE
Payments of Distributions and other amounts due on the Capital
Securities (to the extent the Trust has funds available for the payment of such
Distributions) are irrevocably guaranteed by the Company as and to the extent
set forth under "Description of New Securities -- Description of Guarantee." If
and to the extent that the Company does not make payments under the Subordinated
Debentures, the Trust will not pay Distributions or other amounts due on the
Capital Securities. The Guarantee does not cover payment of Distributions when
the Trust does not have sufficient funds to pay such Distributions. In such
event, a holder of Capital Securities may institute a legal proceeding directly
against the Company under the Indenture to enforce payment of such Distributions
to such holder after the respective due dates. Taken together, the Company's
obligations under the Subordinated Debentures, the Indenture, and the Guarantee
provide, in the aggregate, a full and unconditional guarantee of payments of
distributions and other amounts due on the Capital Securities. No single
document standing alone or operating in conjunction with fewer than all of the
other documents constitutes such guarantee. It is only the combined operation of
these documents that has the effect of providing a full and unconditional
guarantee of the Trust's obligations under the Capital Securities. The
obligations of the Company under the Guarantee and the Subordinated Debentures
are subordinate and junior in right of payment to all Indebtedness of the
Company to the extent described herein.
SUFFICIENCY OF PAYMENTS
As long as payments of interest and other payments are made when due on
the Subordinated Debentures, such payments will be sufficient to cover
Distributions and other payments due on the Capital Securities, primarily
because (i) the aggregate principal amount of the Subordinated Debentures will
be equal to the sum of the aggregate stated Liquidation Amount of the Capital
Securities and the Common Securities; (ii) the interest rate and interest and
other payment dates on the Subordinated Debentures will match the distribution
rate and Distribution Date and other payment dates for the related Capital
Securities; (iii) the Company will pay for all and any costs, expenses, and
liabilities of the Trust except the Trust's obligations under the Capital
Securities; and (iv) the Declaration provides that the Trust will not engage in
any activity that is not consistent with the limited purposes of the Trust.
Notwithstanding anything to the contrary in the Indenture, the Company
has the right to set-off any payment it is otherwise required to make thereunder
with and to the extent the Company has theretofore made, or is concurrently on
the date of such payment making, a related payment under the Guarantee.
ENFORCEMENT RIGHTS OF HOLDERS OF CAPITAL SECURITIES
A holder of Capital Securities may institute a legal proceeding
directly against the Company to enforce its rights under the Guarantee without
first instituting a legal proceeding against the Guarantee Trustee, the Trust,
or any other person or entity.
A default or event of default under any Indebtedness of the Company
will not constitute a default or Indenture Event of Default. In addition, in the
event of payment defaults under, or acceleration of, Indebtedness of the
Company, the subordination provisions of the Indenture provide that, except as
otherwise specified therein, no payments may be made in respect of the
Subordinated Debentures until such Indebtedness has been paid in full or any
payment default thereunder has been cured or waived. Failure to make required
payments on the Subordinated Debentures would constitute an Indenture Event of
Default under the Indenture.
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LIMITED PURPOSE OF TRUST
The Capital Securities evidence a beneficial ownership interest in the
assets of the Trust, and the Trust exists for the sole purpose of issuing the
Capital Securities and the Common Securities and investing the proceeds thereof
in Subordinated Debentures. A principal difference between the rights of a
holder of Capital Securities and a holder of Subordinated Debentures is that a
holder of Subordinated Debentures is entitled to receive from the Company the
principal amount of and interest accrued on Subordinated Debentures held, while
a holder of Capital Securities is entitled to receive Distributions from the
Trust (or from the Company under the Guarantee) if and to the extent the Trust
has funds available for the payment of such Distributions.
RIGHTS UPON TERMINATION
Upon any voluntary or involuntary termination, winding-up, or
liquidation of the Trust involving the liquidation of the Subordinated
Debentures, the holders of the Capital Securities will be entitled to receive,
out of assets held by the Trust, the Liquidation Distribution in cash. See
"Description of New Securities -- Description of Capital Securities --
Liquidation Distribution Upon Dissolution." Upon any voluntary or involuntary
liquidation or bankruptcy of the Company, the Property Trustee, as holder of the
Subordinated Debentures, would be a subordinated creditor of the Company,
subordinated in right of payment to all Indebtedness to the extent described
herein, but entitled to receive payment in full of principal and interest before
any stockholders of the Company receive payments or distributions. Since the
Company is the guarantor under the Guarantee and has agreed to pay for all
costs, expenses, and liabilities of the Trust (other than the Trust's
obligations to the holders of the Capital Securities), the positions of a holder
of Capital Securities and a holder of the Subordinated Debentures relative to
other creditors and to stockholders of the Company in the event of liquidation
or bankruptcy of the Company would be substantially the same.
CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
In the opinion of Porter, Wright, Morris & Arthur, in its capacity as
special tax counsel to the Company and the Trust ("Tax Counsel"), the following
summary accurately describes the material United States federal income tax
consequences of the Exchange Offer and of the ownership and disposition of the
New Capital Securities. Unless otherwise stated, this summary deals only with
Capital Securities held as capital assets by United States Persons (defined
below) who purchase the Capital Securities upon original issuance at their
original offering price. As used herein, a "United States Person" means (i) a
person that is a citizen or resident of the United States, (ii) a corporation,
partnership or other entity created or organized in or under the laws of the
United States or any political subdivision thereof, (iii) an estate the income
of which is subject to United States federal income taxation regardless of its
source, or (iv) any trust if a court within the United States is able to
exercise primary supervision over the administration of such trust and one or
more United States fiduciaries have the authority to control all the substantial
decisions of such trust. The tax treatment of a holder may vary depending on its
particular situation. This summary does not address all the tax consequences
that may be relevant to a particular holder or to holders that may be subject to
special tax treatment, such as banks, real estate investment trusts, regulated
investment companies, insurance companies, dealers in securities or currencies,
tax-exempt investors, or persons holding the Capital Securities as a position in
a "straddle," as part of a "hedging," "conversion," or other integrated
investment. In addition, this summary does not address any description of any
alternative minimum tax consequences, the tax laws of any state, local, or
foreign government that may be applicable to a holder of Capital Securities, or
the income tax consequences to shareholders in, or partners or beneficiaries of,
a holder of the Capital Securities. This summary is based on the Internal
Revenue Code of 1986, as amended (the "Code"), the Treasury regulations
promulgated thereunder, and administrative and judicial interpretations thereof,
as of the date hereof, all of which are subject to change, possibly on a
retroactive basis (See "-- Proposed Tax Law Changes," below). The authorities on
which this summary is based are subject to various interpretations, and the
opinions of Tax Counsel are not binding on the Internal Revenue Service ("IRS")
or the courts, either of which could take a contrary position. Moreover, no
rulings have been or will be sought from the IRS with respect to the
transactions described herein. Accordingly, there can be no assurance that the
IRS will not challenge the opinions expressed herein or that a court would not
sustain such a challenge.
HOLDERS SHOULD CONSULT THEIR OWN TAX ADVISORS WITH RESPECT TO THE TAX
CONSEQUENCES TO THEM OF THE EXCHANGE OFFER AND THE OWNERSHIP AND DISPOSITION OF
THE CAPITAL SECURITIES, INCLUDING THE TAX CONSEQUENCES UNDER STATE, LOCAL,
FOREIGN, AND OTHER TAX LAWS AND THE POSSIBLE EFFECTS OF CHANGES IN UNITED STATES
FEDERAL OR OTHER TAX LAWS. FOR A DISCUSSION OF THE POSSIBLE REDEMPTION OF THE
CAPITAL SECURITIES UPON THE OCCURRENCE OF CERTAIN TAX EVENTS, SEE "DESCRIPTION
OF NEW SECURITIES -- DESCRIPTION OF CAPITAL
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SECURITIES -- REDEMPTION -- SPECIAL EVENT REDEMPTION OR DISTRIBUTION OF
SUBORDINATED DEBENTURES."
EXCHANGE OF CAPITAL SECURITIES
Although the matter is not free from doubt, an exchange of Old Capital
Securities for New Capital Securities should not be taxable to the holders.
CLASSIFICATION OF THE TRUST
In connection with the issuance of the Old Capital Securities, Tax
Counsel rendered an opinion that under then current law and assuming full
compliance with the terms of the Declaration and other documents, the Trust will
be classified as a grantor trust and will not be taxable as a corporation for
United States federal income tax purposes. Accordingly, for United States
federal income tax purposes, each holder of Capital Securities will be treated
as owning an undivided beneficial interest in the Subordinated Debentures and,
thus, will be required to include in its gross income its pro rata share of
interest income or original issue discount that is paid or accrued on the
Subordinated Debentures.
CLASSIFICATION OF THE SUBORDINATED DEBENTURES
The Company, the Trust, and the holders of the Capital Securities (by
the acceptance of a beneficial interest in a Capital Security) will agree to
treat the Subordinated Debentures as indebtedness for all United States federal
income tax purposes. In connection with the issuance of the Old Subordinated
Debentures, Tax Counsel rendered an opinion that, under then current law, and
based on the representations, facts, and assumptions set forth therein, the
Subordinated Debentures will be classified as indebtedness for United States
federal income tax purposes.
INTEREST INCOME AND ORIGINAL ISSUE DISCOUNT
Under the applicable Treasury regulations, the Subordinated Debentures
will not be treated as issued with OID within the meaning of section 1273(a) of
the Code because the Company had concluded, and this discussion assumes, that as
of the date of the original issue of the Old Subordinated Debentures, the
likelihood of its exercising its right to defer payments of interest was remote.
Accordingly, except as set forth below, stated interest on the Subordinated
Debentures generally will be taxable to a holder as ordinary income at the time
it is paid or accrued in accordance with such holder's regular method of tax
accounting.
If, however, the Company exercises its right to defer payments of
interest on the Subordinated Debentures, the Subordinated Debentures would be
treated as reissued for OID purposes at such time and all holders of the
Subordinated Debentures and, consequently, holders of the Capital Securities
will be required to accrue their pro rata share of OID (which will include both
the stated interest and the de minimis OID on the Subordinated Debentures) on a
daily economic accrual basis during the Extension Period even though the Company
will not pay such interest until the end of the Extension Period, and even
though some holders may use the cash method of tax accounting. Moreover,
thereafter the Subordinated Debentures will be taxed as OID instruments for as
long as they remain outstanding. Thus, even after the end of an Extension
Period, all holders would be required to continue to include the stated interest
(and the de minimis OID) on the Subordinated Debentures in income on a daily
basis, regardless of their method of tax accounting and in advance of receipt of
the cash attributable to such interest income. Under the OID economic accrual
rules, a holder would accrue an amount of interest income each year that
approximates the stated interest payments called for under the terms of the
Subordinated Debentures, and actual cash payments of interest on the
Subordinated Debentures would not be reported separately as taxable income. Any
amount of OID included in a holder's gross income (whether or not during an
Extension Period) with respect to a Capital Security will increase such holder's
tax basis in such Capital Security, and the amount of Distributions received by
a holder in respect of such accrued OID will reduce the tax basis of such
Capital Security.
In the absence of the Company's election to defer an interest payment
period, de minimis OID would not be subject to income tax until a holder's
Subordinated Debentures were sold, redeemed, or retired, in which event the de
minimis OID would increase any gain or decrease any loss recognized by the
holder. De minimis OID will be present with respect to the Subordinated
Debentures, in an amount equal to the excess of (a) the stated redemption price
at maturity (as defined for income tax purposes) of the Subordinated Debentures,
over (b) the issue price of the
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Subordinated Debentures, as such amount is less than the product of (x) 0.25% of
the redemption price, and (y) the number of complete calendar years from the
Subordinated Debentures' issue date to its maturity.
If the Company's option to defer payments of interest were not treated
as remote, the Subordinated Debentures would be treated as initially issued with
OID in an amount equal to the aggregate stated interest over the term of the
Subordinated Debentures, plus the amount of de minimis OID on the Subordinated
Debentures. That OID would generally be includible in a United States Person's
taxable income, over the term of the Subordinated Debentures, on an economic
accrual basis.
The Treasury regulations described above have not yet been addressed in
any rulings or other interpretations by the IRS, and it is possible that the IRS
could take a contrary position. If the IRS were to assert successfully that the
stated interest on the Subordinated Debentures was OID regardless of whether the
Company exercises its option to defer payments of interest on such debentures,
all holders of Capital Securities would be required to include such stated
interest in income on a daily economic accrual basis as described above.
Corporate holders of Capital Securities will not be entitled to a
dividends-received deduction with respect to any income recognized by such
holders with respect to the Capital Securities.
DISTRIBUTION OF SUBORDINATED DEBENTURES OR CASH UPON LIQUIDATION OF THE TRUST
As described under the caption "Description of New Securities --
Description of Capital Securities -- Liquidation Distribution Upon Dissolution,"
Subordinated Debentures may be distributed to holders in exchange for the
Capital Securities and in liquidation of the Trust. Under current law, such a
distribution would be non-taxable, and will result in the holder receiving
directly its pro rata share of the Subordinated Debentures previously held
indirectly through the Trust, with a holding period and aggregate tax basis
equal to the holding period and aggregate tax basis such holder had in its
Capital Securities before such distribution. If, however, the liquidation of the
Trust were to occur because the Trust is subject to United States federal income
tax with respect to income accrued or received on the Subordinated Debentures,
the distribution of the Subordinated Debentures to holders would be a taxable
event to the Trust and to each holder and a holder would recognize gain or loss
as if the holder had exchanged its Capital Securities for the Subordinated
Debentures it received upon liquidation of the Trust. A holder would accrue
interest in respect of the Subordinated Debentures received from the Trust in
the manner described above under "-- Interest Income and Original Issue
Discount."
Under certain circumstances described herein (see "Description of New
Securities -- Description of Capital Securities -- Redemption -- Special Event
Redemption or Distribution of Subordinated Debentures"), the Subordinated
Debentures may be redeemed for cash, with the proceeds of such redemption
distributed to holders in redemption of their Capital Securities. Under current
law, such a redemption would constitute a taxable disposition of the redeemed
Capital Securities for United States federal income tax purposes, and a holder
would recognize gain or loss as if it sold such redeemed Capital Securities for
cash. See "-- Sales of Capital Securities."
SALES OF CAPITAL SECURITIES
A holder that sells Capital Securities will recognize gain or loss
equal to the difference between the amount realized by such holder on the sale
of the Capital Securities (except to the extent that such amount realized is
characterized as a payment in respect of accrued but unpaid interest on such
holder's allocable share of the Subordinated Debentures that the holder had not
included in gross income previously) and the holder's adjusted tax basis in the
Capital Securities sold. Such gain or loss generally will be a capital gain or
loss and generally will be taxable as a long-term capital gain or loss if the
Capital Securities have been held for more than one year. Subject to certain
limited exceptions, capital losses cannot be applied to offset ordinary income
for United States federal income tax purposes.
PROPOSED TAX LAW CHANGES
Legislation was proposed by the United States Department of Treasury on
February 6, 1997, as part of President Clinton's Fiscal 1998 Budget Proposal
that contains a provision which generally would deny an interest deduction for
interest paid or accrued on an instrument issued by a corporation that (i) has a
maximum term of more than 15 years and (ii) is not shown as indebtedness on the
separate balance sheet of the issuer or, where the instrument is issued to a
related party (other than a corporation), where the holder or some other related
party issues a related instrument that is not shown as indebtedness on the
consolidated balance sheet that includes the issuer and the holder. As
originally
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drafted, this provision was proposed to be effective generally for debt
instruments issued on or after the date of the first Congressional committee
action taken on the proposed legislation. If this provision were to apply to the
Subordinated Debentures, the Company would be prohibited from deducting the
interest on the Subordinated Debentures which would trigger a "Tax Event" (see
below). On June 9, 1997, House Ways and Means Committee Chairman Bill Archer
released his draft proposed Revenue Reconciliation Act of 1997 which deleted
this particular provision. As of June 25, 1997, neither the House Ways and Means
Committee nor the Senate Finance Committee has included this provision in their
approved versions of the Revenue Reconciliation Act. The Joint Committee has yet
to address the provision.
Even though the most recent Congressional action does not incorporate
the President's Proposal concerning the disallowance of interest deductions on
long-term debt obligations not treated as indebtedness on the issuer's balance
sheet, there can be no assurance as to the ultimate resolution of the pending
legislation on this issue. Thus, there can be no assurance that the proposed
legislation, future legislative proposals, or final legislation will not
adversely affect the ability of the Company to deduct interest on the
Subordinated Debentures or otherwise affect the tax treatment of the
transactions described herein. Moreover, such legislation could give rise to a
Tax Event, which would permit the Company to cause a redemption of the Capital
Securities, as described more fully herein under the caption "Description of New
Securities -- Description of Capital Securities -- Redemption -- Special Event
Redemption or Substitution of Subordinated Debentures."
NON-UNITED STATES HOLDERS
As used herein, the term "Non-United States Holder" means any holder
that is not a United States Person (as defined above). As discussed above, the
Capital Securities will be treated as evidence of an indirect beneficial
ownership interest in the Subordinated Debentures. See "-- Classification of the
Trust." Thus, under present United States federal income tax law, and subject to
the discussion below concerning backup withholding:
(a) no withholding of United States federal income tax will be
required with respect to the payment by the Trust or the Company or any
paying agent of principal or interest (which for purposes of this
discussion includes any OID) with respect to the Capital Securities (or
on the Subordinated Debentures) to a Non-United States Holder, provided
(i) that the beneficial owner of the Capital Securities ("Beneficial
Owner") does not actually or constructively own 10% or more of the
total combined voting power of all classes of stock of the Company
entitled to vote within the meaning of section 871(h)(3) of the Code
and the regulations thereunder, (ii) the Beneficial Owner is not a
controlled foreign corporation for United States federal income tax
purposes that is related to the Company through stock ownership, (iii)
the Beneficial Owner is not a bank whose receipt of interest with
respect to the Capital Securities (or on the Subordinated Debentures)
is described in section 881(c)(3)(A) of the Code, and (iv) the
Beneficial Owner satisfies the statement requirement (described
generally below) set forth in section 871(h) and section 881(c) of the
Code and the regulations thereunder, and
(b) no withholding of United States federal income tax will be
required with respect to any gain realized by a Non-United States
Holder upon the sale or other disposition of the Capital Securities (or
Subordinated Debentures).
To satisfy the requirement referred to in (a)(iv) above, the Beneficial
Owner, or a financial institution holding the Capital Securities on behalf of
such owner, must provide, in accordance with specified procedures, to the Trust
or its paying agent, a statement to the effect that the Beneficial Owner is not
a United States Person. Pursuant to current temporary Treasury regulations,
these requirements will be met if (1) the Beneficial Owner provides his name and
address, and certifies, under penalties of perjury, that it is not a United
States Person (which certification may be made on an IRS Form W-8 (or successor
form)) or (2) a financial institution holding the Capital Securities (or
Subordinated Debentures) on behalf of the Beneficial Owner certifies, under
penalties of perjury, that such statement has been received by it and furnishes
a paying agent with a copy thereof.
If a Non-United States Holder cannot satisfy the requirements of the
"portfolio interest" exception described in (a) above, payments of interest
(including any OID) made to such Non-United States Holder will be subject to a
30% withholding tax unless the Beneficial Owner provides the Trust or the
Company or any paying agent, as the case may be, with a properly executed (1)
IRS Form 1001 (or successor form) claiming an exemption from, or a reduction of,
such withholding tax under the benefit of a tax treaty or (2) IRS Form 4224 (or
successor form) stating that interest paid with respect to the Capital
Securities (or on the Subordinated Debentures) is not subject to withholding tax
because it is effectively connected with the Beneficial Owner's conduct of a
trade or business in the United States.
If a Non-United States Holder is engaged in a trade or business in the
United States and interest with respect to the Capital Securities (or on the
Subordinated Debentures) is effectively connected with the conduct of such trade
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or business, the Non-United States Holder, although exempt from the withholding
tax discussed above, will be subject to United States federal income tax on such
interest income on a net income basis in the same manner as if it were a United
States Person. In addition, if such Non-United States Holder is a foreign
corporation, it may be subject to a branch profits tax equal to 30% of its
effectively connected earnings and profits for the taxable year, subject to
adjustments. For this purpose, such interest income would be included in such
foreign corporation's earnings and profits.
Any gain realized upon the sale or other disposition of the Capital
Securities (or the Subordinated Debentures) generally will not be subject to
United States federal income tax unless (i) such gain is effectively connected
with a trade or business in the United States of the Non-United States Holder,
(ii) in the case of a Non-United States Holder who is an individual, such
individual is present in the United States for 183 days or more in the taxable
year of such sale, exchange, or retirement, and certain other conditions are
met, or (iii) in the case of any gain representing accrued interest on the
Subordinated Debentures, the requirements of the "portfolio interest" exception
described in (a) above are not satisfied.
As discussed above, legislation has been introduced in the 105th
Congress that would deny an interest deduction to the Company for the interest
payable on the Subordinated Debentures. Such legislation also may cause the
Subordinated Debentures to be classified as equity (rather than indebtedness) of
the Company for United States federal income tax purposes and, thus, cause the
income derived from the Subordinated Debentures to be characterized as dividend,
rather than interest, income for such purposes. Dividend income is not eligible
for the "portfolio interest" exception described in (a) above. Therefore, if
such legislation is enacted and if it applies to the Subordinated Debentures,
income derived by a Non-United States Holder on the Capital Securities may be
subject to the 30% United States federal withholding tax described above, unless
a reduction or elimination of such tax is available under an applicable tax
treaty or such dividend income is effectively connected with a trade or business
carried on in the United States by such Non-United States Holder. See "--
Proposed Tax Law Changes."
INFORMATION REPORTING AND BACKUP WITHHOLDING
The amount of interest (or OID, if any) accrued on the Capital
Securities (or the Subordinated Debentures) held of record by United States
Persons (other than corporations and other exempt holders) will be reported
annually to such holders and to the IRS. The Property Trustee currently intends
to deliver such reports to holders of record prior to January 31 following each
calendar year. It is anticipated that persons who hold Capital Securities as
nominees for beneficial holders will report the required tax information to
beneficial holders on Form 1099.
"Backup withholding" at a rate of 31% will apply to payments of
interest (or OID, if any) to non-exempt United States Persons unless the holder
furnishes its taxpayer identification number in the manner prescribed in
applicable Treasury regulations, certifies that such number is correct,
certifies as to no loss of exemption from backup withholding, and meets certain
other conditions.
No information reporting or backup withholding will be required with
respect to payments made by the Trust or any paying agent to Non-United States
Holders if a statement described in (a)(iv) under "Non-United States Holders"
has been received and the payor does not have actual knowledge that the
beneficial owner is a United States Person.
In addition, backup withholding and information reporting will not
apply if payments of the principal, interest, OID, or premium with respect to
the Capital Securities (or on the Subordinated Debentures) are paid or collected
by a foreign office of a custodian, nominee, or other foreign agent on behalf of
the Beneficial Owner, or if a foreign office of a broker (as defined in
applicable Treasury regulations) pays the proceeds of the sale of the Capital
Securities (or the Subordinated Debentures) to the owner thereof. If, however,
such nominee, custodian, agent or broker is, for United States federal income
tax purposes, a United States Person, a controlled foreign corporation, or a
foreign person that derives 50% or more of its gross income for certain periods
from the conduct of a trade or business in the United States, such payments will
not be subject to backup withholding but will be subject to information
reporting, unless (1) such custodian, nominee, agent, or broker has documentary
evidence in its records that the Beneficial Owner is not a United States Person
and certain other conditions are met or (2) the Beneficial Owner otherwise
establishes an exemption.
On April 22, 1996, proposed Treasury Regulations (the "1996 Proposed
Regulations") were issued which, if adopted in final form, would alter the
information reporting and backup withholding rules in certain respects. In
particular, in the case of Capital Securities (or Subordinated Debentures) the
1996 Proposed Regulations would provide certain presumptions under which a
Non-United States Holder may be subject to backup withholding in the absence of
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required certification. It cannot be predicted at this time whether the 1996
Proposed Regulations will become effective as proposed or what, if any,
modifications may be made to them.
Payment of the proceeds from disposition of Capital Securities (or the
Subordinated Debentures) to or through a United States office of a broker is
subject to information reporting and backup withholding unless the holder or
beneficial owner establishes an exemption from information reporting and backup
withholding.
Any amounts withheld from a holder of the Capital Securities under the
backup withholding rules will be allowed as a refund or a credit against such
holder's United States federal income tax liability, provided the required
information is furnished to the IRS.
BOOK-ENTRY ISSUANCE
The New Capital Securities initially will be represented by one or more
Capital Securities in registered, global form (collectively, the "Global Capital
Securities"). The Global Capital Securities will be deposited upon issuance with
the Property Trustee as custodian for DTC, in New York, New York, and registered
in the name of DTC or its nominee, in each case for credit to an account of a
direct or indirect participant in DTC as described below.
Except as set forth below, the Global Capital Securities may be
transferred, in whole and not in part, only to another nominee of DTC or to a
successor of DTC or its nominee. Beneficial interests in the Global Capital
Securities may not be exchanged for Capital Securities in certificated form
except in the limited circumstances described below. See "-- Exchange of
Book-Entry Capital Securities for Certificated Capital Securities." Transfer of
beneficial interests in the Global Capital Securities will be subject to the
applicable rules and procedures of DTC and its direct or indirect participants
(including, if applicable, those of the Euroclear System ("Euroclear") and
CEDEL, S.A. ("CEDEL")), which may change from time to time.
DEPOSITARY PROCEDURES
DTC has advised the Trust and the Company that DTC is a limited-purpose
trust company created to hold securities for its participating organizations
(collectively, the "Participants") and to facilitate the clearance and
settlement of transactions in those securities between Participants through
electronic book-entry changes in accounts of its Participants. The Participants
include securities brokers and dealers (including the Initial Purchasers),
banks, trust companies, clearing corporations, and certain other organizations.
Access to DTC's system is also available to other entities such as banks,
brokers, dealers, and trust companies that clear through or maintain a custodial
relationship with a Participant, either directly or indirectly (collectively,
the "Indirect Participants"). Persons who are not Participants may beneficially
own securities held by or on behalf of DTC only through the Participants or the
Indirect Participants. The ownership interest and transfer of ownership interest
of each actual purchaser of each security held by or on behalf of DTC are
recorded on the records of the Participants and Indirect Participants.
DTC has also advised the Trust and the Company that, pursuant to
procedures established by it, the ownership of interests in the Global Capital
Securities will be shown on, and the transfer of ownership thereof will be
effected only through, records maintained by DTC (with respect to the
Participants) or by the Participants and the Indirect Participants (with respect
to other owners of beneficial interests in the Global Capital Securities).
Investors in the Global Capital Securities may hold their interests
therein directly through DTC if they are participants in such system, or
indirectly through organizations (including Euroclear and CEDEL) which are
participants in such system. All interests in a Global Capital Security,
including those held through Euroclear or CEDEL, may be subject to the
procedures and requirements of DTC. Those interests held through Euroclear or
CEDEL may also be subject to the procedures and requirements of such system. The
laws of some states require that certain persons take physical delivery in
certificated form of securities that they own. Consequently, the ability to
transfer beneficial interests in a Global Capital Security to such persons will
be limited to that extent. Because DTC can act only on behalf of Participants,
which in turn act on behalf of Indirect Participants and certain banks, the
ability of a person having beneficial interests in a Global Capital Security to
pledge such interests to
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persons or entities that do not participate in the DTC system, or otherwise take
actions in respect of such interests, may be affected by the lack of a physical
certificate evidencing such interests. For certain other restrictions on the
transferability of the Capital Securities, see "-- Exchange of Book-Entry
Capital Securities for Certificated Capital Securities."
Except as described below, owners of interests in the Global Capital
Securities will not have Capital Securities registered in their name, will not
received physical delivery of Capital Securities in certificated form, and will
not be considered the registered owners or holders thereof for any purpose.
Payments in respect of the Global Capital Security registered in the
name DTC or its nominee will be payable by the Property Trustee to DTC in its
capacity as the registered holder. The Property Trustee will treat the persons
in whose names the Capital Securities, including the Global Capital Securities,
are registered as the owners thereof for the purpose of receiving such payments
and for any and all other purposes whatsoever. Consequently, neither the
Property Trustee nor any agent thereof has or will have any responsibility or
liability for (i) any aspect of DTC's records or any Participant's or Indirect
Participant's records relating to or payments made on account of beneficial
ownership interests in the Global Capital Securities, or for maintaining,
supervising, or reviewing any of DTC's records or any Participant's or Indirect
Participant's records relating to the beneficial ownership interests in the
Global Capital Securities or (ii) any other matter relating to the actions and
practices of DTC or any of its Participants or Indirect Participants. DTC has
advised the Trust and the Company that its current practice, upon receipt of any
payment in respect of securities such as the Capital Securities, is to credit
the accounts of the relevant Participants with the payment on the payment date
unless DTC has reason to believe it will not receive payment on such payment
date. Payments by the Participants and the Indirect Participants to the
beneficial owners of Capital Securities will be governed by standing
instructions and customary practices and will be the responsibility of the
Participants or the Indirect Participants and will not be the responsibility of
DTC, the Property Trustee, the Trust, or the Company. None of the Company, the
Trust, or the Property Trustee will be liable for any delay by DTC or any of its
Participants in identifying the beneficial owners of the Capital Securities, and
the Company, the Trust, and the Property Trustee may conclusively rely on and
will be protected in relying on instructions from DTC or its nominee for all
purposes.
Except for trades involving only Euroclear or CEDEL participants,
interests in the Global Capital Securities will trade in DTC's Same-Day Funds
Settlement System and secondary market trading activity in such interests will
therefore settle in immediately available funds, subject in all cases to the
rules and procedures of DTC and its participants.
Transfers between Participants in DTC will be effected in accordance
with DTC's procedures, and will be settled in same-day funds. Transfers between
participants in Euroclear or CEDEL will be effected in the ordinary way in
accordance with their respective rules and operating procedures.
Subject to compliance with the transfer restrictions applicable to the
Capital Securities described herein, cross-market transfers between the
Participants in DTC, on the one hand, and Euroclear or CEDEL participants, on
the other hand, will be effected through DTC in accordance with DTC's rules on
behalf of Euroclear or CEDEL, as the case may be, by its respective depositary;
however, such cross-market transactions will require delivery of instructions to
Euroclear or CEDEL, as the case may be, by the counter-party in such system in
accordance with the rules and procedures and within the established deadlines
(Brussels time) of such system. Euroclear or CEDEL, as the case may be, will, if
the transaction meets its settlement requirements, deliver instructions to its
respective depositary to take action to effect final settlement on its behalf by
delivering or receiving interests in the relevant Global Capital Securities in
DTC, and making or receiving payment in accordance with normal procedures for
same-day funds settlement applicable to DTC. Euroclear participants and CEDEL
participants may not deliver instructions directly to the depositaries for
Euroclear or CEDEL.
Because of time zone differences, the securities account of a Euroclear
or CEDEL participant purchasing an interest in a Global Capital Security from a
Participant in DTC will be credited, and any such crediting will be reported to
the relevant Euroclear of CEDEL participant, during the securities settlement
processing day (which must be a business day for Euroclear and CEDEL)
immediately following the settlement date of DTC. Cash received in Euroclear or
CEDEL as a result of sales of interest in a Global Capital Security by or
through a Euroclear or CEDEL participant to a Participant in DTC will be
received with value on the settlement date of DTC but will be available in the
relevant Euroclear or CEDEL cash account only as of the business day for
Euroclear or CEDEL following DTC's settlement date.
DTC has advised the Trust and the Company that it will take any action
permitted to be taken by a holder of Capital Securities only at the direction of
one or more Participants to whose account with DTC interests in the Global
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Capital Securities are credited. However, if there is an Event of Default, DTC
reserves the right to exchange the Global Capital Securities for Capital
Securities in certificated form and to distribute such Capital Securities to its
Participants.
The information in this section concerning DTC, Euroclear, and CEDEL
and their book-entry systems has been obtained from sources that the Trust and
the Company believe to be reliable, but neither the Trust nor the Company takes
responsibility for the accuracy thereof.
Although DTC, Euroclear, and CEDEL have agreed to the foregoing
procedures to facilitate transfers of interest in the Global Capital Securities
among participants in DTC, Euroclear, and CEDEL, they are under no obligation to
perform or to continue to perform such procedures, and such procedures may be
discontinued at any time. None of the Company, the Trust, or the Property
Trustee will have any responsibility for the performance by DTC, Euroclear, or
CEDEL or their respective participants or indirect participants of their
respective obligations under the rules and procedures governing their
operations.
EXCHANGE OF BOOK-ENTRY CAPITAL SECURITIES FOR CERTIFICATED CAPITAL SECURITIES
A Global Capital Security is exchangeable for Capital Securities in
registered certificated form if (i) DTC (x) notifies the Trust that it is
unwilling or unable to continue as Depositary for the Global Capital Security
and the Trust thereupon fails to appoint a successor Depositary or (y) has
ceased to be a clearing agency registered under the Exchange Act, (ii) the
Company in its sole discretion elects to cause the issuance of the Capital
Securities in certificated form, or (iii) there shall have occurred and be
continuing an Event of Default or any event which after notice or lapse of time
or both would be an Event of Default under the Declaration.
BENEFIT PLAN CONSIDERATIONS
Each fiduciary of pension, profit sharing, or other employee benefit
plan subject to the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), should consider, among other matters, (a) ERISA's fiduciary standards
(including its prudence and diversification requirements), (b) whether such
fiduciary has authority to make an investment in the Capital Securities under
the applicable Plan investment policies and governing instruments, and (c) rules
under ERISA and the Code that prohibit a Plan fiduciary from causing a Plan to
engage in a "prohibited transaction."
Section 406 of ERISA and Section 4975 of the Code prohibit Plans, as
well as individual retirement accounts and Keogh plans subject to Section 4975
of the Code (also "Plans"), from, among other things, engaging in certain
transactions involving "plan assets" with persons who are "parties in interest"
under ERISA or "disqualified persons" under the Code with respect to such Plan.
A violation of these "prohibited transaction" rules may result in an excise tax
or other liabilities under ERISA and/or Section 4975 of the Code for such
persons, unless exemptive relief is available under an applicable statutory or
administrative exemption. Employee benefit plans that are governmental plans (as
defined in Section 3(32) of ERISA), certain church plans (as defined in Section
3(33) of ERISA), and foreign plans (as described in Section 4(b)(4) of ERISA)
are not subject to the requirements of ERISA or Section 4975 of the Code.
The Department of Labor ("DOL") has issued a regulation (29 C.F.R.
Section 2510.3-101) (the "Plan Assets Regulation") concerning the definition of
what constitutes the assets of a Plan. The Plan Assets Regulation provides that,
as a general rule, the underlying assets and properties of corporations,
partnerships, trusts, and certain other entities in which a plan makes an
"equity" investment will be deemed for purposes of ERISA to be assets of the
investing plan unless certain exceptions apply.
Pursuant to an exception contained in the Plan Assets Regulation, the
assets of the Trust would not be deemed to be "plan assets" of investing Plans
if, immediately after the most recent acquisition of any equity interest in the
Trust, less than 25% of the value of each class of equity interest in the Trust
were held by Plans, other employee benefit plans not subject to ERISA, or
Section 4975 of the Code (such as governmental, church, and foreign plans) and
entities
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holding assets deemed to be "plan assets" of any Plan (collectively, "Benefit
Plan Investors"). No assurance can be given that the value of the Capital
Securities held by Benefit Plan Investors will be less than 25% of the total
value of such Capital Securities and no monitoring or other measures will be
taken with respect to the satisfaction of the conditions to this exception. All
of the Common Securities will be purchased and held directly by the Company.
There can be no assurance that any of the exceptions set forth in the
Plan Assets Regulation will apply to the purchase of Capital Securities and, as
a result, an investing Plan's assets could be considered to include an undivided
interest in the Subordinated Debentures held by the Trust. In the event that
assets of the Trust are considered assets of an investing Plan, the Declaration
Trustees, the Company, and other persons, in providing services with respect to
the Subordinated Debentures, may be considered fiduciaries to such Plan and
subject to the fiduciary responsibility provisions of Title I of ERISA. In
addition, certain transactions involving the Trust and/or the Capital Securities
could be deemed to constitute direct or indirect prohibited transactions under
ERISA and Section 4975 of the Code with respect to a Plan. For example, if the
Company or any Trustee is a party in interest or a fiduciary with respect to an
investing Plan (either directly or by reason of its ownership of its
subsidiaries), extensions of credit between the Company and the Trust (as
represented by the Subordinated Debentures and the Guarantee) would likely be
prohibited by Section 406 of ERISA and Section 4975 of the Code.
The DOL has issued five PTCEs that may provide exemptive relief for
direct or indirect prohibited transactions resulting from the purchase or
holding of the Capital Securities, assuming that assets of the Trust were deemed
to be "plan assets" of Plans investing in the Trust (see above). Those class
exemptions are PTCE 96-23 (for certain transactions determined by in-house asset
managers), PTCE 91-38 (for certain transactions involving bank collective
investment funds), PTCE 95-60 (for certain transactions involving insurance
company general accounts), PTCE 90-1 (for certain transactions involving
insurance company pooled separate accounts), and PTCE 84-14 (for certain
transactions determined by independent qualified professional asset managers).
Because of ERISA's prohibitions and those of Section 4975 of the Code,
the Capital Securities may not be purchased or held by any Plan, any Plan Asset
Entity, or any person having "plan assets" of any Plan, unless such purchase or
holding is covered by the exemptive relief provided by PTCE 96-23, 95-60, 91-38,
90-1, or 84-14 or another applicable exemption. If a purchaser or holder of the
Capital Securities that is a Plan or a Plan Asset Entity elects to rely on an
exemption other than PTCE 96-23, 95-60, 91-38, 90-1 or 84-14, the Company and
the Trust may require a satisfactory opinion of counsel or other evidence with
respect to the availability of such exemption for such purchase and holding. Any
purchaser or holder of the Capital Securities or any interest therein will be
deemed to have represented by its purchase and holding thereof that either (a)
the purchaser and holder is not a Plan or a Plan Asset Entity and is not
purchasing such securities on behalf of or with "plan assets" of any Plan, or
(b) the purchase and holding of the Capital Securities is covered by the
exemptive relief provided by PTCE 96-23, 95-60, 91-38, 90-1, or 84-14 or another
applicable exemption.
Due to the complexity of these rules and the penalties that may be
imposed upon persons involved in non-exempt prohibited transactions, it is
particularly important that fiduciaries or other persons investing in the
Capital Securities on behalf of or with "plan assets" of any Plan consult with
their own counsel regarding the potential consequences if the assets of the
Trust were deemed to be "plan assets" and the availability of exemptive relief
under PTCE 96-23, 95-60, 91-38, 90-1, or 84-14 or another applicable exemption.
Governmental Plans, as defined in Section 3(32) of ERISA, are not
subject to ERISA, and are also not subject to the prohibited transaction
provisions of Section 4975 of the Code. However, state laws or regulations
governing the investment and management of the assets of such plans may contain
fiduciary and prohibited transaction provisions similar to those under ERISA and
the Code discussed above. Accordingly, fiduciaries of government plans, in
consultation with their advisers, should consider the impact of their respective
state laws on investments in the Capital Securities, and the considerations
discussed above, to the extent applicable.
PLAN OF DISTRIBUTION
Each broker-dealer that receives New Capital Securities for its own
account in connection with the Exchange Offer must acknowledge that it will
deliver a prospectus in connection with any resale of such New Capital
Securities. This Prospectus, as it may be amended or supplemented from time to
time, may be used by Participating Broker-Dealers during the period referred to
below in connection with resales of New Capital Securities received in exchange
for Old Capital Securities if such Old Capital Securities were acquired by such
Participating Broker-Dealers for their own accounts as a result of market-making
activities or other trading activities. The Issuer has agreed that this
Prospectus,
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as it may be amended or supplemented from time to time, may be used by a
Participating Broker-Dealer in connection with resales of such New Capital
Securities for a period ending 180 days after the Expiration Date (subject to
extension under certain limited circumstances described herein) or, if earlier,
when all such New Capital Securities have been disposed of by such Participating
Broker-Dealer. See "The Exchange Offer -- Resales of New Capital Securities."
The Issuer will not receive any proceeds from the issuance of the New Capital
Securities offered hereby. New Capital Securities received by broker-dealers for
their own accounts in connection with the Exchange Offer may be sold from time
to time in one or more transactions in the over-the-counter market, in
negotiated transactions, through the writing of options on the New Capital
Securities or a combination of such methods of resale, at market prices
prevailing at the time of resale at prices related to such prevailing market
prices or at negotiated prices. Any such resale may be made directly to
purchasers or to or through brokers or dealers who may receive compensation in
the form of commissions or concessions from any such broker-dealer and/or the
purchasers of any such New Capital Securities. Any broker-dealer that resells
New Capital Securities that were received by it for its own account in
connection with the Exchange Offer and any broker or dealer that participates in
a distribution of such New Capital Securities may be deemed to be an
"underwriter" within the meaning of the Securities Act, and any profit on any
such resale of New Capital Securities and any commissions or concessions
received by any such persons may be deemed to be underwriting compensation under
the Securities Act. The Letter of Transmittal states that by acknowledging that
it will deliver and by delivering a prospectus, a broker-dealer will not be
deemed to admit that it is an "underwriter" within the meaning of the Securities
Act.
LEGAL MATTERS
Certain matters of Delaware law relating to the validity of the New
Capital Securities, the enforceability of the Declaration, and the formation of
the Trust will be passed upon on behalf of the Trust by Richards, Layton &
Finger P.A., special Delaware counsel to the Company and the Trust. The validity
of the New Subordinated Debentures and the New Guarantee will be passed upon for
the Company and the Trust by Porter, Wright, Morris & Arthur. Certain United
States federal income tax matters will be passed upon for the Company and the
Trust by Porter, Wright, Morris & Arthur. Porter, Wright, Morris & Arthur will
rely as to certain matters of Delaware law on the opinion of Richards Layton &
Finger. As of June 30, 1997, members of Porter, Wright, Morris & Arthur
participating in the representation of the Company and the Trust on this matter
beneficially owned an aggregate of ________ shares of Huntington Common Stock.
EXPERTS
The consolidated financial statements of the Company and its affiliates
included in the Company's Annual Report on Form 10-K for the year ended December
31, 1996, incorporated by reference herein have been audited by Ernst & Young
LLP, independent auditors, as set forth in their report included therein and
incorporated herein by reference. Such financial statements audited by Ernst &
Young LLP are incorporated by reference herein in reliance upon such report
given upon the authority of such firm as experts in accounting and auditing.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Articles of Incorporation of Huntington Bancshares Incorporated
(the "Registrant"), as amended, provide that it shall indemnify its directors to
the full extent of the general laws of the State of Maryland now or hereafter in
force, including the advance of expenses to directors subject to procedures
provided by such laws; its officers to the same extent it shall indemnify its
directors; and its officers who are not directors to such further extent as
shall be authorized by the Board of Directors and be consistent with law.
Section 2-418 of the Maryland general corporation law provides, in
substance, that a corporation may indemnify any director made a party to any
proceeding by reason of service in that capacity against judgments, penalties,
fines, settlements, and reasonable expenses actually incurred by the director in
connection with the proceeding, unless it is proved that the act or omission of
the director was material to the cause of action adjudicated in the proceeding
and was committed in bad faith or was the result of active and deliberate
dishonesty; or the director actually received an improper personal benefit in
money, property, or services; or, in the case of any criminal proceeding, the
director had reasonable cause to believe that the act or omission was unlawful.
Notwithstanding the above, a director may not be indemnified in respect of any
proceeding, by or in the right of the corporation, in which such director shall
have been adjudged liable to the corporation or in respect of any proceeding
charging improper receipt of a personal benefit.
Termination of any proceeding by judgment, order, or settlement does
not create a presumption that the director did not meet the requisite standard
of conduct. Termination of any proceeding by conviction, plea of nolo contendere
or its equivalent, or entry of an order of probation prior to judgment, creates
a rebuttable presumption that the director did not meet the requisite standard
of conduct. Indemnification is not permitted unless authorized for a specific
proceeding, after a determination that indemnification is permissible because
the requisite standard of conduct has been met (1) by a majority of a quorum of
directors not at the time parties to the proceeding (or a majority of a
committee of two or more such directors designated by the full board); (2) by
special legal counsel selected by the board of directors; or (3) by the
stockholders.
The reasonable expenses incurred by a director who is a party to a
proceeding may be paid or reimbursed by the corporation in advance of the final
disposition of the proceeding upon receipt by the corporation of both a written
affirmation by the director of his good faith belief that the standard of
conduct necessary for indemnification by the corporation has been met, and a
written undertaking by or on behalf of the director to repay the amount if it
shall be ultimately determined that the standard of conduct has not been met.
The indemnification and advancement of expenses provided or authorized
by Section 2-418 are not exclusive of any other rights to which a director may
be entitled both as to action in his official capacity and as to action in
another capacity while holding such office.
Pursuant to Section 2-418, a corporation may purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee,
or agent of the corporation, or who, while serving in such capacity, is or was
at the request of the corporation serving as a director, officer, partner,
trustee, employee, or agent of another corporation or legal entity or of an
employee benefit plan, against liability asserted against and incurred by such
person in any such capacity or arising out of such person's position, whether or
not the corporation would have the power to indemnify against liability under
Section 2-418. A corporation may provide similar protection, including a trust
fund, letter of credit, or surety bond, which is not inconsistent with Section
2-418. A subsidiary or an affiliate of the corporation may provide the insurance
or similar protection.
Subject to certain exceptions, the directors and officers of the
Registrant and its affiliates are insured to the extent of 100% of loss up to a
maximum of $35,000,000 (subject to certain deductibles) in each policy year
because of any claim or claims made against them by reason of their wrongful
acts while acting in their capacities as such directors or officers and up to a
maximum of $10,000,000 (subject to certain deductibles) in each policy year
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of any claim or claims made against them by reason of their wrongful acts while
acting in their capacities as fiduciaries in the administration of certain of
the Registrant's employee benefit programs. The Registrant is insured, subject
to certain retentions and exceptions, to the extent it shall have indemnified
the directors and officers for such loss.
Under the Amended and Restated Declaration of Trust, the Registrant has
agreed to indemnify each of the Trustees, and to hold such Trustees harmless
against any loss, liability or expense incurred without negligence or bad faith
on their part, arising out of or in connection with the acceptance of
administration of such Declaration of Trust, including the costs and expenses of
defense against or investigating any claim or liability in connection with the
exercise or performance of any of their powers or duties under the Declaration
of Trust, which is filed as an exhibit to this Registration Statement.
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(a) EXHIBITS.
EXHIBIT
NO. DESCRIPTION
3(i) Articles of Restatement of Charter, Articles of Amendment to
Articles of Restatement of Charter, and Articles Supplementary
-- previously filed as Exhibit 3(i) to Annual Report on Form
10-K for the year ended December 31, 1993, and incorporated
herein by reference.
3(ii) Bylaws -- previously filed as Exhibit 3(b) to Annual Report
on Form 10-K for the year ended December 31, 1987, and
incorporated herein by reference.
3(iii) Certificate of Trust of Huntington Capital I.
4(a) Indenture, dated as of January 31, 1997, between the
Registrant and The Chase Manhattan Bank, as Indenture Trustee.
4(b) Amended and Restated Declaration of Trust of Huntington
Capital I.
4(c) Form of Unrestricted Certificate of Capital Security for
Huntington Capital I.
4(d) Form of Guarantee Agreement.
4(e) Registration Rights Agreement, dated as of January 31, 1997,
among the Registrant, the Trust, and Morgan Stanley & Co.
Incorporated, Lehman Brothers Inc. and Salomon Brothers Inc.
4(f) All instruments defining the rights or holders of long-term
debt of the Corporation and its subsidiaries (not filed
pursuant to Clause 4(iii) of Item 601(b) of Regulation S-K; to
be furnished upon the request of the Commission).
4(g) Rights Plan, dated February 22, 1990, between Huntington
Bancshares Incorporated and The Huntington Trust Company,
National Association, -- previously filed as Exhibit 1 to
Registration Statement on Form 8-A, filed with the Securities
and Exchange Commission on February 22, 1990, and incorporated
herein by reference.
4(h) Amendment No. 1 To Rights Plan, dated August 16, 1995, between
Huntington Bancshares Incorporated and The Huntington Trust
Company, National Association-- previously filed as Exhibit
4(b) to Current Report on Form 8-K, filed with the Securities
and Exchange Commission on August 28, 1995, and incorporated
herein by reference.
5(a) Opinion of Porter, Wright, Morris & Arthur as to validity of
the New Subordinated Debentures and the New Guarantee to be
issued by the Registrant.
5(b) Opinion of Richards, Layton & Finger as to validity of the New
Capital Securities.
8 Opinion of Porter, Wright, Morris & Arthur as to certain
federal income tax matters.
10(a) Memorandum of Understanding concerning certain executives of
First Michigan Bank Corporation, dated May 4, 1997, between
Huntington Bancshares Incorporated and First Michigan Bank
Corporation -- references made to Exhibit 10(a) of
Registration Statement on Form S-4, Registration No.
333-30313, filed with the Securities Exchange Commission on
June 27, 1997, and incorporated herein by reference.
10(b) Employment Agreement, dated September 16, 1991, between
Huntington Bancshares Incorporated and Frank Wobst --
previously filed as Exhibit 10(a) to Annual Report on Form
10-K for the year ended December 31, 1991, and incorporated
herein by reference.
10(c) Employment Agreement, dated September 16, 1991, between
Huntington Bancshares Incorporated and Zuheir Sofia --
previously filed as Exhibit 10(b) to Annual Report on Form
10-K for the year ended December 31, 1991, and incorporated
herein by reference.
10(d) Employment Agreement, dated September 16, 1991, between
Huntington Bancshares Incorporated and W. Lee Hoskins --
previously filed as Exhibit 10(c) to Annual Report on Form
10-K for the year ended December 31, 1991, and incorporated
herein by reference.
10(e) Executive Agreement, dated September 16, 1991, between
Huntington Bancshares Incorporated and Frank Wobst --
previously filed as Exhibit 10(f) to Annual Report on Form
10-K for the year ended December 31, 1991, and incorporated
herein by reference.
10(f) Executive Agreement, dated September 16, 1991, between
Huntington Bancshares Incorporated and Zuheir Sofia --
previously filed as Exhibit 10(g) to Annual Report on Form
10-K for the year ended December 31, 1991, and incorporated
herein by reference.
10(g) Executive Agreement, dated September 16, 1991, between
Huntington Bancshares Incorporated and W. Lee Hoskins --
previously filed as Exhibit 10(h) to Annual Report on Form
10-K for the year ended December 31, 1991, and incorporated
herein by reference.
10(h) Form of Executive Agreement for certain executive officers --
previously filed as Exhibit 10(g) to Annual Report on Form
10-K for the year ended December 31, 1991, and incorporated
herein by reference.
10(i) Schedule identifying material details of Executive Agreements,
substantially similar to Exhibit 10(h) -- previously filed as
Exhibit 10(h) to Annual Report on Form 10-K for the year ended
December 31, 1994, and incorporated herein by reference.
10(j) Incentive Compensation Plan -- previously filed as Exhibit
10(i) to Annual Report on Form 10-K for the year ended
December 31, 1993, and incorporated herein by reference.
10(k) Incentive Compensation Plan Amendment -- previously filed as
Exhibit 10(i) to Quarterly Report on Form 10-Q for the Quarter
ended March 31, 1995, and incorporated herein by reference.
10(l) Long-Term Incentive Compensation Plan, as amended and
effective for performance cycles beginning on or after January
1, 1992 -- previously filed as Exhibit 10(j) to Annual Report
on Form 10-K for the year ended December 31, 1993, and
incorporated herein by reference.
10(m) Supplemental Executive Retirement Plan -- previously filed as
Exhibit 10(g) to Annual Report on Form 10-K for the year ended
December 31, 1987, and incorporated herein by reference.
10(n) Deferred Compensation Plan and Trust for Directors --
reference is made to Exhibit 4(a) of Post-Effective Amendment
No. 2 to Registration Statement on Form S-8, Registration No.
33-10546, filed with the Securities and Exchange Commission on
January 28, 1991, and incorporated herein by reference.
10(o)(1) 1983 Stock Option Plan -- reference is made to Exhibit 4A of
Registration Statement on Form S-8, Registration No. 2-89672,
filed with the Securities and Exchange Commission on February
27, 1984, and incorporated herein by reference.
10(o)(2) 1983 Stock Option Plan -- Second Amendment -- previously
filed as Exhibit 10(j)(2) to Annual Report on Form 10-K for
the year ended December 31, 1987, and incorporated herein by
reference.
10(o)(3) 1983 Stock Option Plan -- Third Amendment -- previously filed
as Exhibit 10(j)(3) to Annual Report on Form 10-K for the year
ended December 31, 1987, and incorporated herein by reference.
10(o)(4) 1983 Stock Option Plan -- Fourth Amendment -- previously
filed as Exhibit 10(m)(4) to Annual Report on Form 10-K for
the year ended December 31, 1993, and incorporated herein by
reference.
10(p)(1) 1990 Stock Option Plan -- reference is made to Exhibit 4(a) of
Registration Statement on Form S-8, Registration No. 33-37373,
filed with the Securities and Exchange Commission on October
18, 1990, and incorporated herein by reference.
10(p)(2) First Amendment to the Huntington Bancshares Incorporated
1990 Stock Option Plan -- previously filed as Exhibit 10(q)(2)
to Annual Report on Form 10-K for the year ended December 31,
1991, and incorporated herein by reference.
10(q) The Huntington Supplemental Stock Purchase and Tax Savings
Plan and Trust (as amended and restated as of February 9,
1990) -- previously filed as Exhibit 4(a) to Registration
Statement on Form S-8, Registration No. 33-44208, filed with
the Securities and Exchange Commission on November 26, 1991,
and incorporated herein by reference.
10(r) Deferred Compensation Plan and Trust for Huntington Bancshares
Incorporated Directors -- reference is made to Exhibit 4(a) of
Registration Statement on Form S-8, Registration No. 33-41774,
filed with the Securities and Exchange Commission on July 19,
1991, and incorporated herein by reference.
10(s) Huntington Bancshares Incorporated Retirement Plan For Outside
Directors -- previously filed as Exhibit 10(t) to Annual
Report on Form 10-K for the year ended December 31, 1992, and
incorporated herein by reference.
10(t) 1994 Stock Option Plan -- reference is made to Exhibit 4(a) of
Registration Statement on Form S-8, Registration No. 33-52553,
filed with the Securities and Exchange Commission on March 8,
1994, and incorporated herein by reference.
12 Computations of Consolidated Ratios of Earnings to Fixed
Charges.
21 * Subsidiaries of the Registrant -- previously filed as
Exhibit 21 to Annual Report on Form 10-K for the year ended
December 31, 1996, and incorporated herein by reference.
23(a) Consent of Ernst & Young LLP.
23(b) Consent of Porter, Wright, Morris & Arthur (included in
Exhibits 5(a) and 8 filed herewith).
23(c) Consent of Richards, Layton & Finger (included in Exhibit 5(b)
filed herewith).
24 Powers of Attorney.
II-2
<PAGE> 69
25(a) Form T-1 Statement of Eligibility of The Chase Manhattan Bank
to act as Trustee under the Indenture.
25(b) Form T-1 Statement of Eligibility of The Chase Manhattan Bank
to act as Trustee under the Declaration of Trust.
25(c) Form T-1 Statement of Eligibility of The Chase Manhattan Bank
under the Guarantee for the benefit of the holders of the
Capital Securities.
27 The Registrant's Financial Data Schedule (incorporated by
reference to Exhibit 27 to the Registrant's 1997 First
Quarter Report on Form 10-Q).
99(a) Form of Letter of Transmittal and instructions thereto.
99(b) Form of Notice of Guaranteed Delivery.
- - ------------------
* To be filed by Amendment
(b) FINANCIAL STATEMENT SCHEDULES
None.
ITEM 22. UNDERTAKINGS.
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 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in 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.
The undersigned Registrant hereby undertakes as follows: that prior to
any public reoffering of the securities registered hereunder through use of a
prospectus which is a part of this Registration Statement, by any person or
party who is deemed to be an underwriter within the meaning of the Rule 145(c),
the issuer undertakes that such reoffering prospectus will contain the
information called for by the applicable registration form with respect to
reofferings by persons who may be deemed underwriters, in addition to the
information called for by the other items of the applicable form.
The Registrant undertakes that every prospectus (i) that is filed
pursuant to the immediately preceding paragraph, or (ii) that purports to meet
the requirements of Section 10(a)(3) of the Securities Act of 1933 and is used
in connection with an offering of securities subject to Rule 415, will be filed
as a part of an amendment to the Registration Statement and will not be used
until such amendment is effective, and that, for purposes 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.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act of 1933 and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of
II-3
<PAGE> 70
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act of 1933 and will be
governed by the final adjudication of such issue.
The undersigned Registrant hereby undertakes to respond to requests for
information that is incorporated by reference into the prospectus pursuant to
Items 4, 10(b), 11, or 13 of this Registration Statement, within one business
day of receipt of such request, and to send the incorporated documents by first
class mail or other equally prompt means. This includes information contained in
documents filed subsequent to the effective date of the Registration Statement
through the date of responding to the request.
The undersigned Registrant hereby undertakes to supply by means of a
post-effective amendment all information concerning a transaction, and the
company being acquired involved therein, that was not the subject of and
included in the Registration Statement when it became effective.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Columbus,
State of Ohio, on June 30, 1997.
HUNTINGTON BANCSHARES INCORPORATED
By: /s/ Ralph K. Frasier
------------------------------------
Ralph K. Frasier
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 dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<S> <C> <C>
*Frank Wobst Chairman and Chief Executive Officer )
- - ------------------------ (principal executive officer) )
)
)
*Zuheir Sofia President, Chief Operating Officer )
- - ------------------------ Treasurer, and Director )
Zuheir Sofia )
)
*Gerald R. Williams Executive Vice President and )
- - ------------------------ Chief Financial Officer )
Gerald R. Williams (principal financial officer and )
accounting officer) )
)
)
)
*Don M. Casto, III Director ) June 30, 1997
- - ------------------------ )
Don M. Casto, III )
)
)
*Don Conrad Director )
- - ------------------------ )
Don Conrad )
)
)
</TABLE>
II-4
<PAGE> 71
<TABLE>
<CAPTION>
<S> <C> <C>
*Patricia T. Hayot Director )
- - --------------------------- )
Patricia T. Hayot )
)
)
*Wm. J. Lhota Director )
- - --------------------------- )
Wm. J. Lhota )
)
)
*Robert H. Schottenstein Director )
- - --------------------------- )
Robert H. Schottenstein )
)
)
*George A. Skestos Director )
- - --------------------------- )
George A. Skestos )
)
)
*Lewis R. Smoot, Sr. Director ) June 30, 1997
- - --------------------------- )
Lewis R. Smoot, Sr. )
)
)
*Timothy P. Smucker Director )
- - --------------------------- )
Timothy P. Smucker )
)
)
*William J. Williams Director )
- - --------------------------- )
William J. Williams )
</TABLE>
*By: /s/ Ralph K. Frasier
----------------------------------
Ralph K. Frasier, attorney-in-fact
for each of the persons indicated
Pursuant to the requirements of the Securities Act of 1933, Huntington
Capital I has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Columbus,
State of Ohio, on June 30, 1997.
HUNTINGTON CAPITAL I
By: /s/ Paul V. Sebert
------------------
Paul V. Sebert
Regular Trustee
II-5
<PAGE> 1
Exhibit 4(a)
HUNTINGTON BANCSHARES INCORPORATED
TO
THE CHASE MANHATTAN BANK
a New York banking corporation, as Trustee
INDENTURE
Dated as of January 31, 1997
Floating Rate Junior Subordinated Debentures due 2027
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
ARTICLE ONE
<S> <C>
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION .......... 1
SECTION 101. Definitions ............................................. 1
Act ............................................................. 2
Additional Interest ............................................. 2
Affiliate ....................................................... 2
Authenticating Agent ............................................ 2
Board of Directors .............................................. 2
Board Resolution ................................................ 2
Business Day .................................................... 3
Calculation Agent ............................................... 3
Capital Securities .............................................. 3
Cedel ........................................................... 3
Closing Date .................................................... 3
Commission ...................................................... 3
Common Securities ............................................... 3
Company ......................................................... 3
Company Request ................................................. 3
Company Order ................................................... 3
Corporate Trust Office .......................................... 3
Covenant Defeasance ............................................. 3
Custodian ....................................................... 3
Declaration ..................................................... 3
Defaulted Interest .............................................. 4
Depositary ...................................................... 4
Determination Date .............................................. 4
DWAC ............................................................ 4
Euroclear ....................................................... 4
Event of Default ................................................ 4
Exchange Act .................................................... 4
Extension Period ................................................ 4
Federal Reserve ................................................. 4
Global Security ................................................. 4
Guarantee ....................................................... 4
Holder .......................................................... 4
Indebtedness .................................................... 4
Indenture ....................................................... 5
Institutional Accredited Investor ............................... 5
Interest Payment Date ........................................... 5
</TABLE>
<PAGE> 3
<TABLE>
<CAPTION>
Page
----
<S> <C>
Investment Company Event ........................................ 5
Junior Subordinated Securities ................................. 5
Legal Defeasance ............................................... 5
LIBOR .......................................................... 6
London Business Day ............................................ 7
Luxembourg Transfer and Paying Agent ........................... 7
Maturity ....................................................... 7
Officers' Certificate .......................................... 7
Opinion of Counsel ............................................. 7
Outstanding .................................................... 7
Paying Agent ................................................... 8
Person ......................................................... 8
Predecessor Security ........................................... 8
Private Placement Legend ....................................... 8
Property Trustee ............................................... 8
Qualified Institutional Buyer .................................. 8
QIB ............................................................ 8
Redemption Date ................................................ 8
Redemption Price ............................................... 8
Registration Rights Agreement .................................. 8
Regular Record Date ............................................ 9
Regular Trustee ................................................ 9
Regulation S ................................................... 9
Regulation S Global Security ................................... 9
Regulatory Capital Event ....................................... 9
Responsible Officer ............................................ 9
Restricted Global Security ..................................... 9
Restricted Period .............................................. 9
Restricted Security ............................................ 9
Rule 144A ...................................................... 9
Securities ..................................................... 9
Securities Act ................................................. 10
Security Register .............................................. 10
Security Registrar ............................................. 10
Special Event .................................................. 10
Special Record Date ............................................ 10
Stated Maturity ................................................ 10
Subsidiary ..................................................... 10
Tax Event ...................................................... 10
Trust .......................................................... 10
Trustee ........................................................ 10
Trust Indenture Act ............................................ 11
U.S. Government Obligations .................................... 11
Vice President ................................................. 11
</TABLE>
<PAGE> 4
<TABLE>
<CAPTION>
Page
----
<S> <C>
SECTION 102. Compliance Certificates and Opinions; Officers'
Certificate of Evidence ................................ 11
SECTION 103. Form of Documents Delivered to Trustee ................. 11
SECTION 104. Acts of Holders; Record Dates .......................... 12
SECTION 105. Notices, Etc. to Trustee and the Company ............... 13
SECTION 106. Notice to Holders; Waiver .............................. 13
SECTION 107. Conflict With Trust Indenture Act ...................... 14
SECTION 108. Effect of Headings and Table of Contents ............... 14
SECTION 109. Separability Clause .................................... 14
SECTION 110. Benefits of Indenture .................................. 14
SECTION 111. GOVERNING LAW .......................................... 14
SECTION 112. Legal Holidays ......................................... 15
ARTICLE TWO
SECURITY FORMS....................... 15
ARTICLE THREE
THE SECURITIES...................... 16
SECTION 301. Title and Terms ........................................ 16
SECTION 302. Denominations .......................................... 17
SECTION 303. Execution, Authentication, Delivery and Dating ......... 18
SECTION 304. Temporary Securities ................................... 18
SECTION 305. Registration; Registration of Transfer and
Exchange ............................................... 19
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities ....... 20
SECTION 307. Payment of Interest; Interest Rights Preserved ......... 21
</TABLE>
<PAGE> 5
<TABLE>
<CAPTION>
Page
----
<S> <C>
SECTION 308. Persons Deemed Owners .................................. 22
SECTION 309. Cancellation ........................................... 22
SECTION 310. Computation of Interest ................................ 23
SECTION 311. Right of Set-off ....................................... 23
SECTION 312. CUSIP Numbers .......................................... 23
SECTION 313. Global Securities ...................................... 23
SECTION 314. Restrictive Legend ..................................... 26
SECTION 315. Special Transfer Provisions ............................ 28
ARTICLE FOUR
SATISFACTION AND DISCHARGE; DEFEASANCE................ 31
SECTION 401. Satisfaction and Discharge of Indenture ................ 31
SECTION 402. Legal Defeasance ....................................... 32
SECTION 403. Covenant Defeasance .................................... 32
SECTION 404. Conditions to Legal Defeasance or Covenant Defeasance .. 33
SECTION 405. Application of Trust Money ............................. 34
SECTION 406. Indemnity for U.S. Government Obligations .............. 34
ARTICLE FIVE
REMEDIES........................... 34
SECTION 501. Events of Default....................................... 34
SECTION 502. Acceleration of Maturity; Rescission and Annulment...... 35
SECTION 503. Collection of Indebtedness and Suits for Enforcement
by Trustee.............................................. 36
</TABLE>
<PAGE> 6
<TABLE>
<CAPTION>
Page
----
<S> <C>
SECTION 504. Trustee may File Proofs of Claim ....................... 37
SECTION 505. Trustee may Enforce Claims Without Possession of
Securities .. .......................................... 37
SECTION 506. Application of Money Collected ......................... 37
SECTION 507. Limitation on Suits .................................... 38
SECTION 508. Unconditional Right of Holders to Receive Principal
and Interest; Capital Security Holders' Rights ......... 38
SECTION 509. Restoration of Rights and Remedies ..................... 39
SECTION 510. Rights and Remedies Cumulative ......................... 39
SECTION 511. Delay or Omission not Waiver ........................... 39
SECTION 512. Control by Holders ..................................... 40
SECTION 513. Waiver of Past Defaults ................................ 40
SECTION 514. Undertaking for Costs .................................. 41
SECTION 515. Waiver of Stay or Extension Laws ....................... 41
ARTICLE SIX
TRUSTEE........................... 41
SECTION 601. Certain Duties and Responsibilities .................... 41
SECTION 602. Notice of Defaults ..................................... 42
SECTION 603. Certain Rights of Trustee .............................. 42
SECTION 604. Not Responsible for Recitals or Issuance of Securities . 43
SECTION 605. Trustee and Other Agents may Hold Securities ........... 44
SECTION 606. Money Held in Trust .................................... 44
SECTION 607. Compensation; Reimbursement; and Indemnity ............. 44
SECTION 608. Disqualification; Conflicting Interests ................ 45
</TABLE>
<PAGE> 7
<TABLE>
<CAPTION>
Page
----
<S> <C>
SECTION 609. Corporate Trustee Required; Eligibility ................ 45
SECTION 610. Resignation and Removal; Appointment of Successor ...... 45
SECTION 611. Acceptance of Appointment by Successor.................. 47
SECTION 612. Merger, Conversion, Consolidation or Succession to
Business................................................ 47
SECTION 613. Preferential Collection of Claims Against Company....... 47
ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY............. 48
SECTION 701. Company to Furnish Trustee Names and Addresses of
Holders .... ........................................... 48
SECTION 702. Preservation of Information; Communications to Holders . 48
SECTION 703. Reports by Trustee ..................................... 48
SECTION 704. Reports by Company ..................................... 49
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE............ 49
SECTION 801. Company May Consolidate, Etc., Only on Certain Terms.... 49
SECTION 802. Successor Person Substituted............................ 50
ARTICLE NINE
SUPPLEMENTAL INDENTURES...................... 51
SECTION 901. Supplemental Indentures Without Consent of Holders ..... 51
SECTION 902. Supplemental Indentures With Consent of Holders ........ 51
SECTION 903. Execution of Supplemental Indentures ................... 52
SECTION 904. Effect of Supplemental Indentures ...................... 52
SECTION 905. Conformity With Trust Indenture Act .................... 53
</TABLE>
<PAGE> 8
<TABLE>
<CAPTION>
Page
----
<S> <C>
SECTION 906. Reference in Securities to Supplemental Indentures ..... 53
ARTICLE TEN
COVENANTS.......................... 53
SECTION 1001. Payment of Principal and Interest ..................... 53
SECTION 1002. Maintenance of Office or Agency ....................... 53
SECTION 1003. Money for Security Payments to be Held in Trust ....... 54
SECTION 1004. Statements by Officers as to Default .................. 55
SECTION 1005. Existence ............................................. 55
SECTION 1006. Maintenance of Properties ............................. 55
SECTION 1007. Payment of Taxes and Other Claims ..................... 55
SECTION 1008. Waiver of Certain Covenants ........................... 56
SECTION 1009. Payment of the Trust's Costs and Expenses ............. 56
SECTION 1010. Restrictions on Payments and Distributions ............ 57
ARTICLE ELEVEN
SUBORDINATION OF SECURITIES............... 57
SECTION 1101. Securities Subordinate to Indebtedness ................ 57
SECTION 1102. Default on Indebtedness ............................... 58
SECTION 1103. Prior Payment of Indebtedness Upon Acceleration of
Securities ............................................ 58
SECTION 1104. Liquidation; Dissolution .............................. 59
SECTION 1105. Subrogation ........................................... 60
SECTION 1106. Trustee to Effectuate Subordination ................... 61
SECTION 1107. Notice by the Company ................................. 61
</TABLE>
<PAGE> 9
<TABLE>
<CAPTION>
Page
----
<S> <C>
SECTION 1108. Rights of the Trustee; Holders of Indebtedness ........ 62
SECTION 1109. Subordination May Not Be Impaired ..................... 63
ARTICLE TWELVE
REDEMPTION OF SECURITIES................. 63
SECTION 1201. Optional Redemption; Conditions to Optional
Redemption ...... ..................................... 63
SECTION 1202. Applicability of Article .............................. 64
SECTION 1203. Election to Redeem; Notice to Trustee ................. 64
SECTION 1204. Selection by Trustee of Securities to be Redeemed ..... 64
SECTION 1205. Notice of Redemption .................................. 64
SECTION 1206. Deposit of Redemption Price ........................... 65
SECTION 1207. Securities Payable on Redemption Date ................. 65
SECTION 1208. Securities Redeemed in Part ........................... 66
</TABLE>
<PAGE> 10
This INDENTURE is dated as of January 31, 1997, between HUNTINGTON
BANCSHARES INCORPORATED, a Maryland corporation (herein called the "Company"),
having its principal office at the Huntington Center, 41 South High Street,
Columbus, Ohio 43287 and THE CHASE MANHATTAN BANK, a New York banking
corporation, as Trustee (herein called the "Trustee").
RECITALS
WHEREAS, for its lawful corporate purposes, the Company has duly
authorized the execution and delivery of this Indenture to provide for the
issuance of its Floating Rate Junior Subordinated Debentures due 2027 (the
"Junior Subordinated Securities" or the "Securities").
WHEREAS, Huntington Capital I (the "Trust") has offered to the public
its Floating Rate Capital Securities (the "Capital Securities") representing
undivided beneficial ownership interests in the assets of the Trust and proposes
to invest the proceeds from such offering and the proceeds from the issuance of
its Common Securities in the Securities.
WHEREAS, to provide the terms and conditions upon which the
Securities are to be authenticated, issued and delivered, the Company has duly
authorized the execution of this Indenture.
WHEREAS, all things necessary to make this Indenture a valid
agreement of the Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities, as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 101. Definitions.
For all purposes of this Indenture, except as expressly provided or
unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular and the
masculine as well as the feminine;
(2) all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
<PAGE> 11
2
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles;
(4) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision;
(5) a reference to any Person shall include its successor and
assigns;
(6) a reference to any agreement or instrument shall mean such
agreement or instrument as supplemented, modified, amended or amended and
restated and in effect from time to time;
(7) a reference to any statute, law, rule or regulation, shall
include any amendments thereto applicable to the relevant Person, and any
successor statute, law, rule or regulation; and
(8) a reference to any particular rating category shall be deemed to
include any corresponding successor category, or any corresponding rating
category issued by a successor or subsequent rating agency.
"Act", when used with respect to any Holder, has the meaning
specified in Section 104.
"Additional Interest" has the meaning specified in Section 307.
"Affiliate" of any specified Person means any other Person directly
or indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Authenticating Agent" means any Person authorized by the Trustee to
act on behalf of the Trustee to authenticate Securities.
"Board of Directors" means either the board of directors of the
Company or any duly authorized committee of that board as the context requires.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
the Board of Directors or the Executive Committee thereof and to be in full
force and effect on the date of such certification, and delivered to the
Trustee.
<PAGE> 12
3
"Business Day" means any day other than a Saturday or Sunday or a day
on which banking institutions in the City of New York or the City of Columbus
are authorized or required by law or executive order to remain closed or a day
on which the Corporate Trust Office of the Trustee, or the principal office of
the Property Trustee, under the Declaration, is closed for business.
"Calculation Agent" means any Person authorized by the Company to
determine the interest rate of the Securities.
"Capital Securities" has the meaning specified in the Recitals to
this instrument.
"Cedel" means Cedel Bank, societe anonymne.
"Closing Date" means January 31, 1997 and such other dates as the
parties hereto may agree upon to consummate the transactions contemplated
hereby.
"Commission" means the Securities and Exchange Commission, as from
time to time constituted, created under the Securities Exchange Act of 1934, or,
if at any time after the execution of this instrument such Commission is not
existing and performing the duties now assigned to it under the Trust Indenture
Act, then the body performing such duties at such time.
"Common Securities" means the common securities issued by the Trust.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by its Chairman of the Board, its Vice
Chairman of the Board, its President or a Vice President, and by its Treasurer,
an Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered
to the Trustee.
"Corporate Trust Office" means the principal office of the Trustee in
the City of New York, at which at any particular time its corporate trust
business shall be administered and which at the date of this Indenture is
located at 450 West 33rd Street, New York, New York 10001, Attention: Global
Trust Services.
"Covenant Defeasance" has the meaning specified in Section 403.
"Custodian" means the custodian for the time being of any Global
Security as designated by the Depositary.
"Declaration" means the Amended and Restated Declaration of Trust,
dated as of January 31, 1997, as amended, modified or supplemented from time to
time, among the
<PAGE> 13
4
trustees of the Trust named therein, the Company, as sponsor, and the holders
from time to time of undivided beneficial ownership interests in the assets of
the Trust.
"Defaulted Interest" has the meaning specified in Section 307.
"Depositary" means, with respect to Securities issuable in whole or
in part in the form of one or more Global Securities, a clearing agency
registered under the Exchange Act that is designated to act as Depositary for
such Securities.
"Determination Date" means, with respect to any interest period, the
date that is two London Business Days prior to the first day of such interest
period.
"DWAC" means Deposit and Withdrawal At Custodian Service.
"Euroclear" means Morgan Guaranty Trust Company of New York, Brussels
office, as operator of the Euroclear System.
"Event of Default" has the meaning specified in Section 501.
"Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, and any successor legislation.
"Extension Period" has the meaning specified in Section 301.
"Federal Reserve" means means the Board of Governors of the Federal
Reserve System, as from time to time constituted, or if at any time after the
execution of this Indenture the Federal Reserve is not existing and performing
the duties now assigned to it, then the body performing such duties at such
time.
"Global Security" means a Security that evidences all or part of the
Securities and is authenticated and delivered to, and registered in the name of,
the Depositary for such Securities or a nominee thereof.
"Guarantee" means the Guarantee Agreement, dated as of January 31,
1997, made by the Company in favor of The Chase Manhattan Bank as trustee
thereunder for the benefit of the Holders (as defined therein) of the Capital
Securities and the holder of the Common Securities.
"Holder" means a Person in whose name a Security is registered in the
Security Register.
"Indebtedness" means, whether recourse is to all or a portion of the
assets of the Company and whether or not contingent, (i) every obligation of the
Company for money borrowed; (ii) every obligation of the Company evidenced by
bonds, debentures, notes or other similar instruments, including obligations
incurred in connection with the acquisition of
<PAGE> 14
5
property, assets or businesses; (iii) every reimbursement obligation of the
Company with respect to letters of credit, bankers' acceptances or similar
facilities issued for the account of the Company; (iv) every obligation of the
Company issued or assumed as the deferred purchase price of property or services
(but excluding trade accounts payable or accrued liabilities arising in the
ordinary course of business); (v) every capital lease obligation of the Company;
(vi) every obligation of the Company for claims (as defined in Section 101(4) of
the United States Bankruptcy Code of 1978, as amended) in respect of derivative
products such as interest and foreign exchange rate contracts, commodity
contracts and similar arrangements; and (vii) every obligation of the type
referred to in clauses (i) through (vi) of another Person and all dividends of
another Person the payment of which, in either case, the Company has guaranteed
or is responsible or liable for, directly or indirectly, as obligor or
otherwise; provided that "Indebtedness" shall not include (a) any obligations
which, by their terms, are expressly stated to rank pari passu in right of
payment with, or to not be superior in right of payment to, the Securities, (b)
any Indebtedness of the Company which when incurred was without recourse to the
Company, (c) any Indebtedness of the Company to any of its Subsidiaries, (d)
Indebtedness of the Company to any employee, or (e) any Indebtedness in respect
of debt securities issued to any trust, or a trustee of such trust, partnership
or other entity affiliated with the Company that is a financing entity of the
Company in connection with the issuance of such financing entity of securities
that are similar to the Capital Securities.
"Indenture" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as the term is defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act.
"Interest Payment Date", when used with respect to any installment of
interest on a Security, means the date specified in such Security as the fixed
date on which an installment of interest with respect to the Securities is due
and payable.
"Investment Company Event" means the receipt by the Trust of an
Opinion of Counsel experienced in such matters, to the effect that, as a result
of the occurrence of a change in law or regulation by any legislative body,
court, governmental agency or regulatory authority (a "Change in 1940 Act Law"),
the Trust is or will be considered an "investment company" that is required to
be registered under the Investment Company Act of 1940, as amended, which Change
in 1940 Act Law becomes effective on or after the date of original issuance of
the Securities.
"Junior Subordinated Securities" has the meaning specified in the
Recitals to this instrument.
<PAGE> 15
6
"Legal Defeasance" has the meaning specified in Section 402.
"LIBOR" means, with respect to an interest period relating to an
Interest Payment Date (in the following order of priority):
(i) the rate (expressed as a percentage per annum) for Eurodollar
deposits having a three-month maturity that appears on Telerate
Page 3750 as of 11:00 a.m. (London time) on the related
Determination Date;
(ii) if such rate does not appear on Telerate Page 3750 as of 11:00
a.m. (London time) on the related Determination Date, LIBOR will
be the arithmetic mean (if necessary rounded upwards to the
nearest whole multiple of .00001%) of the rates (expressed as
percentages per annum) for Eurodollar deposits having a
three-month maturity that appear on Reuters Monitor Money Rates
Page LIBO ("Reuters Page LIBO") as of 11:00 a.m. (London time) on
such Determination Date;
(iii) if such rate does not appear on Reuters Page LIBO as of 11:00
a.m. (London time) on the related Determination Date, the
Calculation Agent will request the principal London offices of
four leading banks in the London interbank market to provide such
banks' offered quotations (expressed as percentages per annum) to
prime banks in the London interbank market for Eurodollar
deposits having a three-month maturity as of 11:00 a.m. (London
time) on such Determination Date. If at least two quotations are
provided, LIBOR will be the arithmetic mean (if necessary rounded
upwards to the nearest whole multiple of .00001%) of such
quotations;
(iv) if fewer than two such quotations are provided as requested in
clause (iii) above, the Calculation Agent will request four major
New York City banks to provide such banks' offered quotations
(expressed as percentages per annum) to leading European banks
for Loans in Eurodollars as of 11:00 a.m. (London time) on such
Determination Date. If at least two such quotations are provided,
LIBOR will be the arithmetic mean (if necessary rounded upwards
to the nearest whole multiple of .00001%) of such quotations; and
(v) if fewer than two such quotations are provided as requested in
clause (iv) above, LIBOR will be LIBOR determined with respect to
the interest period immediately preceding such current interest
period.
If the rate for Eurodollar deposits having a three-month maturity that
initially appears on Telerate Page 3750 or Reuters Page LIBO, as the case may
be, as of 11:00 a.m. (London time) on the related Determination Date is
superseded on Telerate Page 3750 or Reuters Page LIBO, as the case may be, by a
corrected rate before 12:00 noon (London time)
<PAGE> 16
7
on such Determination Date, the corrected rate as so substituted on the
applicable page will be the applicable LIBOR for such Determination Date.
"London Business Day" means any day, other than a Saturday or Sunday,
on which banks are open for business in London.
"Luxembourg Transfer and Paying Agent" shall have the meaning set
forth in the Declaration.
"Maturity", when used with respect to any Security, means the date on
which the principal of such Security becomes due and payable as therein or
herein provided, whether at the Stated Maturity (which may be extended as
therein or herein provided) or by declaration of acceleration, call for
redemption or otherwise.
"Officers' Certificate" means a certificate signed on behalf of the
Company by the Chairman of the Board, a Vice Chairman of the Board, the
President or a Vice President, and by the Treasurer, an Assistant Treasurer, the
Secretary or an Assistant Secretary, of the Company, and delivered to the
Trustee. One of the officers signing an Officers' Certificate given pursuant to
Section 1004 shall be the principal executive, financial or accounting officer
of the Company. Any Officers' Certificate delivered with respect to compliance
with a condition or covenant provided for in this Indenture shall include:
(a) a statement that each officer signing the Officers' Certificate
on behalf of the Company has read the covenant or condition and the definitions
relating thereto;
(b) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(c) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company (and who may be an employee of the Company). An opinion
of counsel may rely on Officers' Certificates as to matters of fact.
"Outstanding", when used with respect to Securities, means, as of the
date of determination, all Securities authenticated and delivered under this
Indenture, except: (i) Securities cancelled by the Trustee or delivered to the
Trustee for cancellation; (ii) Securities for whose payment or redemption money
in the necessary amount has been deposited with the Trustee or any Paying Agent
(other than the Company) in trust or set aside and segregated in trust by the
Company (if the Company shall act as its own Paying Agent) for the Holder of
such Securities; provided that, if such Securities are to be redeemed, notice of
such redemption has been duly given pursuant to this Indenture or provision
therefor satisfactory to the Trustee has been made; and (iii) Securities which
have been paid pursuant to Section 306, or in
<PAGE> 17
8
exchange or for in lieu of which other Securities have been authenticated and
delivered pursuant to this Indenture, other than any such Securities in respect
of which there shall have been presented to the Trustee proof satisfactory to it
that such Securities are held by a bona fide purchaser in whose hands such
Securities are valid obligations of the Company; provided, however, that in
determining whether the holders of the requisite principal amount of Outstanding
Securities are present at a meeting of holders of Securities for quorum purposes
or have consented to or voted in favor of any request, demand, authorization,
direction, notice, consent, waiver, amendment or modification hereunder,
Securities held for the account of the Company, any of its subsidiaries or any
of its affiliates shall be disregarded and deemed not to be Outstanding, except
that in determining whether the Trustee shall be protected in making such a
determination or relying upon any such quorum, consent or vote, only Securities
which a Responsible Officer of the Trustee actually knows to be so owned shall
be so disregarded.
"Paying Agent" means any Person authorized by the Company to pay the
principal of or interest on any Securities on behalf of the Company; provided,
however, that at all times and so long as the Securities are listed on the
Luxembourg Stock Exchange, and the Luxembourg Stock Exchange so requires, a
Paying Agent shall be located in Luxembourg.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever nature.
"Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same debt as that evidenced
by such particular Security; and, for the purposes of this definition, any
security authenticated and delivered under Section 306 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security.
"Private Placement Legend" has the meaning specified in Section 314
of this Indenture.
"Property Trustee" has the meaning set forth in the Declaration.
"Qualified Institutional Buyer" or "QIB" shall have the meaning
specified in Rule 144A under the Securities Act.
"Redemption Date", when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price", when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Registration Rights Agreement" means the Registration Rights
Agreement dated the date hereof between the Company and Morgan Stanley & Co.
Incorporated, Lehman
<PAGE> 18
9
Brothers Inc. and Salomon Brothers as Initial Purchasers for the benefit of
themselves and the Holders (as defined therein) of the Capital Securities as the
same may be amended from time to time in accordance with the terms thereof.
"Regular Record Date" for the interest payable on any Interest
Payment Date means the fifteenth day of the month of the relevant Interest
Payment Date.
"Regular Trustee" has the meaning specified in the Declaration.
"Regulation S" means Regulation S under the Securities Act and any
successor regulation thereto.
"Regulation S Global Security" means any Global Security or
Securities evidencing Securities that are to be traded pursuant to Regulation S.
"Regulatory Capital Event" means that the Company shall have received
an opinion of independent bank regulatory counsel experienced in such matters to
the effect that, as a result of (a) any amendment to or change (including any
announced prospective change) in the laws (or any regulations thereunder) of the
United States or any rules, guidelines or policies of the Federal Reserve or (b)
any official or administrative pronouncement or action or judicial decision for
interpreting or applying such laws or regulations, which amendment or change is
effective or such pronouncement or decision is announced on or after the date of
original issuance of the Capital Securities, the Capital Securities do not
constitute, or within 90 days of the date thereof, will not constitute Tier 1
capital (or its then equivalent); provided, however, that the distribution of
the Securities in connection with the liquidation of the Trust by the Company
shall not in and of itself constitute a Regulatory Capital Event unless such
liquidation shall have occurred in connection with a Tax Event or an Investment
Company Event.
"Responsible Officer", when used with respect to the Trustee, means
any officer within the Corporate Trust Office, including any Vice President,
Assistant Vice Presidents, the Secretary, any Assistant Secretary, or any other
officer of the Trustee customarily performing functions similar to those
performed by any of the above designated officers and also means, with respect
to a particular corporate trust matter, any other officer to whom such matter is
referred because of his knowledge of and familiarity with the particular
subject.
"Restricted Global Security" means any Global Security or Securities
evidencing Securities that are to be traded pursuant to Rule 144A.
"Restricted Period" shall have the meaning specified in Section 315.
<PAGE> 19
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"Restricted Security" has the meaning assigned to such term in Rule
144(a)(3) of the Securities Act.
"Rule 144A" means Rule 144A under the Securities Act.
"Securities" has the meaning specified in the Recitals to this
instrument.
"Securities Act" means the Securities Act of 1933, as amended.
"Security Register" and "Security Registrar" have the respective
meanings specified in Section 305.
"Special Event" means either an Investment Company Event, a
Regulatory Capital Event or a Tax Event.
"Special Record Date" for the payment of any Defaulted Interest means
a date fixed by the Trustee pursuant to Section 307.
"Stated Maturity", when used with respect to any Security or any
installment of interest thereon, means the date specified in such Security as
the date on which the principal, together with any accrued and unpaid interest,
of such Security or such installment of interest is due and payable.
"Subsidiary" means a corporation more than 50% of the outstanding
voting stock of which is owned, directly or indirectly, by the Company or by one
or more other Subsidiaries or by the Company and one or more other Subsidiaries.
For the purposes of this definition, "voting stock" means stock which ordinarily
has voting power for the election of directors, whether at all times or only so
long as no senior class of stock has such voting power by reason of any
contingency.
"Tax Event" means the receipt by the Trust of an Opinion of Counsel,
rendered by a law firm experienced in such matters, to the effect that, as a
result of any amendment to, change in or announced proposed change in the laws
(or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein, or as a result of any
official or administrative pronouncement or action or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
adopted or which proposed change, pronouncement or decision is announced or
which action is taken on or after the date of original issuance of the Capital
Securities under the Declaration, there is more than an insubstantial risk that
(i) the Trust is, or will be within 90 days of the date of such opinion, subject
to United States federal income tax with respect to income received or accrued
on the Securities, (ii) interest payable by the Company on the Securities is
not, or within 90 days of the date of such opinion, will not be, deductible by
the Company, in whole or in part, for United States federal income tax purposes,
or (iii) the Trust is, or will be within 90 days of the date of such opinion,
subject to more than a de minimis amount of other taxes, duties or other
governmental charges.
<PAGE> 20
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"Trust" means Huntington Capital I, a statutory business trust
declared and established pursuant to the Delaware Business Trust Act by the
Declaration.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this Indenture until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in
force at the date as of which this instrument was executed; provided, however,
that in the event the Trust Indenture Act of 1939 is amended after such date,
"Trust Indenture Act" means, to the extent required by any such amendment, the
Trust Indenture Act of 1939 as so amended.
"U.S. Government Obligations" has the meaning specified in Section
404.
"Vice President", when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president."
SECTION 102. Compliance Certificates and Opinions; Officers' Certificate of
Evidence.
Upon any application or request by the Company to the Trustee to take
any action under any provision of this Indenture, the Company shall furnish to
the Trustee such certificates and opinions as may be required under the Trust
Indenture Act. Each such certificate or opinion shall be given in the form of an
Officers' Certificate, if to be given by an officer of the Company, or an
Opinion of Counsel, if to be given by counsel, and shall comply with the
requirements of the Trust Indenture Act and any other requirement set forth in
this Indenture.
Whenever in the administration of the provisions of this Indenture
the Trustee shall deem it necessary or desirable that a matter be proved or
established prior to taking or omitting any action hereunder, such matter
(unless other evidence in respect thereof be herein specifically prescribed)
may, in the absence of negligence or bad faith on the part of the Trustee, be
deemed to be conclusively proved and established by an Officers' Certificate
delivered to the Trustee, and such certificate, in the absence of negligence or
bad faith on the part of the Trustee, shall be full warrant to the Trustee for
any action taken or omitted by it under the provisions of this Indenture upon
the faith thereof.
SECTION 103. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
<PAGE> 21
12
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or opinion of counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
SECTION 104. Acts of Holders; Record Dates.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee at the address specified in Section 105 and, where it is hereby
expressly required, to the Company. Such instrument or instruments (and the
action embodied therein and evidenced thereby) are herein sometimes referred to
as the "Act" of the Holders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose of this Indenture and (subject to Section 601)
conclusive in favor of the Trustee and the Company, if made in the manner
provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority.
(c) The Company may, in the circumstances permitted by the Trust
Indenture Act, fix any day as the record date for the purpose of determining the
Holders entitled to give or take any request, demand, authorization, direction,
notice, consent, waiver or other action, or to vote on any action, authorized or
permitted to be given or taken by Holders. If not set by the Company prior to
the first solicitation of a Holder made by any Person in respect of any such
action, or, in the case of any such vote, prior to such vote, the record date
for any such action or vote shall be the 15th day (or, if later, the date of the
most recent list of Holders
<PAGE> 22
13
required to be provided pursuant to Section 701) prior to such first
solicitation or vote, as the case may be.
With regard to any record date, only the Holders on such date (or
their duly designated proxies) shall be entitled to give or take, or vote on,
the relevant action.
(d) The ownership of Securities shall be proved by the Security
Register.
(e) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Security shall bind every future Holder
of the same Security and the Holder of every Security issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done, omitted or suffered to be done by the Trustee or the
Company in reliance thereon, whether or not notation of such action is made upon
such Security.
SECTION 105. Notices, Etc. to Trustee and the Company.
Any request, demand, authorization, direction, notice, consent,
waiver or Act of Holders or other document provided or permitted by this
Indenture to be made upon, given or furnished to, or filed with:
(1) the Trustee by any Holder or by the Company shall be sufficient
for every purpose hereunder if made, given, furnished or filed in writing to or
with the Trustee at its Corporate Trust Office; or
(2) the Company by the Trustee or by any Holder shall be sufficient
for every purpose hereunder (unless otherwise herein expressly provided) if in
writing and mailed, first-class postage prepaid, to the Company addressed to it
at the address of its principal office specified in the first paragraph of this
instrument or at any other address previously furnished in writing to the
Trustee by the Company; provided, however, that the Trustee may provide such
information or documents to the Company by facsimile or overnight courier.
SECTION 106. Notice to Holders; Waiver.
Where this Indenture provides for notice to Holders of any event,
such notice shall be sufficiently given (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage prepaid, to each Holder
affected by such event, at his address as it appears in the Security Register,
not later than the latest date (if any), and not earlier than the earliest date
(if any), prescribed for the giving of such notice. In any case where notice to
Holders is given by mail, neither the failure to mail such notice, nor any
defect in any notice so mailed, to any particular Holder shall affect the
sufficiency of such notice with respect to other Holders. Where this Indenture
provides for notice in any manner, such notice may be waived in writing by the
Person entitled to receive such notice, either before or after the event, and
such waiver shall be the equivalent of such notice. Waivers of notice by Holders
shall be
<PAGE> 23
14
filed with the Trustee, but such filing shall not be a condition precedent to
the validity of any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made by telecopier or overnight air courier
guaranteeing next day delivery.
SECTION 107. Conflict With Trust Indenture Act.
If any provision hereof limits, qualifies or conflicts with a
provision of the Trust Indenture Act that is required under such Act to be a
part of and govern this Indenture, the provision of the Trust Indenture Act
shall control. If any provision of this Indenture modifies or excludes any
provision of the Trust Indenture Act that may be so modified or excluded, the
latter provision shall be deemed to apply to this Indenture as to modified or so
be excluded, as the case may be.
SECTION 108. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
SECTION 109. Separability Clause.
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
SECTION 110. Benefits of Indenture.
Nothing in this Indenture or in the Securities, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder, the holders of Indebtedness, the holders of Capital Securities (to
the extent provided herein) and the Holders of Securities, any benefit or any
legal or equitable right, remedy or claim under this Indenture.
SECTION 111. GOVERNING LAW.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. THIS INDENTURE IS SUBJECT
TO THE PROVISIONS OF THE TRUST INDENTURE ACT THAT ARE REQUIRED TO BE PART OF
THIS INDENTURE AND SHALL, TO THE EXTENT APPLICABLE, BE GOVERNED BY SUCH
PROVISIONS.
<PAGE> 24
15
SECTION 112. Legal Holidays.
In any case where any Interest Payment Date, Redemption Date or
Stated Maturity of any Security shall not be a Business Day, then
(notwithstanding any other provision of this Indenture or of the Securities)
payment of interest or principal of the Securities need not be made on such
date, but may be made on the next succeeding Business Day (except that, if such
Business Day is in the next succeeding calendar year, such Interest Payment
Date, Redemption Date or Stated Maturity, as the case may be, shall be the
immediately preceding Business Day) with the same force and effect as if made on
the Interest Payment Date or Redemption Date, or at the Stated Maturity,
provided that no interest shall accrue for the period from and after such
Interest Payment Date, Redemption Date or Stated Maturity, as the case may be.
ARTICLE TWO
SECURITY FORMS
The Junior Subordinated Securities in definitive form shall be in the
form attached hereto as Exhibit A.
If the Securities are distributed to the holders of Capital
Securities and Common Securities, the record holder (including any Depositary)
of any Capital Securities or Common Securities shall be issued Securities in
definitive, fully registered form without interest coupons, substantially in the
form of Exhibit A hereto, with the legends in substantially the form of the
legends existing on the security representing the Capital Securities or Common
Securities to be exchanged (with such changes thereto as the officers executing
such Securities determine to be necessary or appropriate, as evidenced by their
execution of the Securities) and such other legends as may be applicable thereto
(including any legend required by Section 313 or Section 314 hereof), duly
executed by the Company and authenticated (upon receipt of a Company Order for
the authentication) by the Trustee or the Authenticating Agent as provided
herein, which Securities, if to be held in global form by any Depositary, may be
deposited on behalf of the holders of the Securities represented thereby with
the Trustee, as custodian for the Depositary, and registered in the name of a
nominee of the Depositary.
Any Global Security shall represent such of the outstanding
Securities as shall be specified therein and shall provide that it shall
represent the aggregate amount of outstanding Securities from time to time
endorsed thereon and that the aggregate amount of outstanding Securities
represented thereby may from time to time be increased or reduced to reflect
transfers or exchanges permitted hereby. Any endorsement of a Global Security to
reflect the amount of any increase or decrease in the amount of outstanding
Securities represented thereby shall be made by the Trustee or the Custodian, at
the direction of the Trustee, in such manner and upon written instructions given
by the holder of such Securities in
<PAGE> 25
16
accordance with the Indenture. Payment of principal, interest and premium, if
any, on any Global Security shall be made to the holder of such Global Security.
The Securities shall have such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by this
Indenture, and may have such letters, numbers or other marks of identification
and such legends or endorsements placed thereon as may be required to comply
with the rules of any securities exchange or as may, consistently herewith, be
determined by the officers executing such Securities, as evidenced by their
execution of the Securities.
The definitive Securities shall be printed, lithographed or engraved
or produced by any combination of these or other methods, all as determined by
the officers executing such Securities, as evidenced by their execution of such
Securities.
ARTICLE THREE
THE SECURITIES
SECTION 301. Title and Terms.
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited.
The Securities' Stated Maturity shall be February 1, 2027.
The Securities shall bear interest at a variable per annum rate equal
to LIBOR plus 0.70%, from January 31, 1997 or from the most recent Interest
Payment Date to which interest has been paid or duly provided for, as the case
may be, payable quarterly (subject to deferral as set forth herein), in arrears,
on the last day of January, April, July and October of each year, commencing
April 30, 1997, until the principal thereof is paid or made available for
payment; provided that, if all amounts due hereunder and under the Securities
are paid on February 1, 2027, the final Interest Payment Date shall be February
1, 2027 (and not January 31, 2027) and interest will accrue from the most recent
Interest Payment Date prior to February 1, 2027 on which interest has been paid
or duly provided for up to and including January 31, 2027. Interest will
compound quarterly and will accrue at a variable per annum rate equal to LIBOR
plus 0.70%, to the extent permitted by applicable law, on any interest
installment in arrears for more than one quarterly period or during an extension
of an interest payment period as set forth below in this Section 301. In the
event that any date on which interest is payable on the Securities is not a
Business Day, then a payment of the interest payable on such date will be made
on the next succeeding day which is a Business Day (and without any interest or
other payment in respect of any such delay); provided, however, that if such
Business Day is the next succeeding calendar year, such payment of the interest
payable shall be on the preceding Business Day.
<PAGE> 26
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The Company shall have the right, at any time during the term of the
Securities, from time to time and so long as no Indenture Event of Default has
occurred or is continuing, to defer payment of interest on such Security for up
to 20 consecutive quarterly periods (an "Extension Period") provided that no
Extension Period may extend past the Maturity of the Security. There may be
multiple Extension Periods of varying lengths during the term of the Securities.
At the end of each Extension Period, if any, the Company shall pay all interest
then accrued and unpaid, together with interest thereon, compounded quarterly at
the rate specified on this Security to the extent permitted by applicable law.
Prior to the termination of any such Extension Period, the Company may further
extend the interest payment period, provided that no Extension Period may exceed
20 consecutive quarterly periods or extend beyond the Stated Maturity of the
Securities. Upon the termination of any such Extension Period and the payment of
all amounts then due on any Interest Payment Date, the Company may elect to
begin a new Extension Period subject to the above requirements. No interest
shall be due and payable during an Extension Period, except at the end thereof.
The Company shall give the Trustee, the Property Trustee and the Regular
Trustees written notice of its election of such Extension Period at least one
Business Day prior to the record date for the related interest payment.
The Trustee shall promptly give notice of the Company's selection of
such Extension Period to the Holders of the Capital Securities.
The principal of and interest on the Securities shall be payable at
the office or agency of the Paying Agent in the United States or in Luxembourg,
if applicable, maintained for such purpose and at any other office or agency
maintained by the Company for such purpose in such coin or currency of the
United States of America as at the time of payment is legal tender for payment
of public and private debts; provided, however, that at the option of the
Company payment of interest may be made (i) by check mailed to the address of
the Person entitled thereto as such address shall appear in the Security
Register or (ii) with respect to Holders who own at least $1,000,000 of
Securities, by wire transfer in immediately available funds at such place and to
such account as may be designated by the Person entitled thereto as specified in
the Security Register.
The Securities shall be subordinated in right of payment to
Indebtedness as provided in Article Eleven.
The Securities shall be redeemable as provided in Article Twelve.
SECTION 302. Denominations.
The Securities shall be issuable only in registered form, without
coupons, and only in denominations of $1,000 and any integral multiple thereof.
<PAGE> 27
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SECTION 303. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by its
Chairman of the Board, its Vice Chairman of the Board, its President or one of
its Vice Presidents. The signature of any of these officers on the Securities
may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.
At any time and from time to time after the execution and delivery of
this Indenture, the Company may deliver Securities executed by the Company to
the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Securities; and the Trustee in accordance
with such Company Order shall authenticate and make available for delivery such
Securities as in this Indenture provided and not otherwise.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or
be valid or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature, and such certificate upon any
Security shall be conclusive evidence, and the only evidence, that such Security
has been duly authenticated and delivered hereunder.
SECTION 304. Temporary Securities.
Pending the preparation of definitive Securities, the Company may
execute, and upon Company Order the Trustee shall authenticate and make
available for delivery, temporary Securities which are printed, lithographed,
typewritten, mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Securities in lieu of which they
are issued and with such appropriate insertions, omissions, substitutions and
other variations as the officers executing such Securities may determine, as
evidenced by their execution of such Securities.
If temporary Securities are issued, the Company will cause definitive
Securities to be prepared without unreasonable delay. After the preparation of
definitive Securities, the temporary Securities shall be exchangeable for
definitive Securities upon surrender of the temporary Securities at any office
or agency of the Company designated pursuant to Section 1002, without charge to
the Holder. Upon surrender for cancellation of any one or more temporary
Securities the Company shall execute and the Trustee shall authenticate, upon
receipt of a Company Order for the authentication, and make available for
delivery in exchange therefor a like principal amount of definitive Securities
of authorized denominations. Until so exchanged the temporary Securities shall
in all respects be entitled to the same benefits under this Indenture as
definitive Securities.
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SECTION 305. Registration; Registration of Transfer and Exchange.
The Company shall cause to be kept at the Corporate Trust Office of
the Trustee, a register (the register maintained in such office and in any other
office or agency designated pursuant to Section 1002 being herein sometimes
collectively referred to as the "Security Register") in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for the
registration of Securities and of transfers of Securities. The Trustee is hereby
appointed "Security Registrar" for the purpose of registering Securities and
transfers of Securities as herein provided.
Upon surrender for registration of transfer of any Security at an
office or agency of the Company designated pursuant to Section 1002 for such
purpose, the Company shall execute, and the Trustee shall, upon receipt of a
Company Order for authentication, authenticate and make available for delivery,
in the name of the designated transferee or transferees, one or more new
Securities of any authorized denominations and of a like aggregate principal
amount.
At the option of the Holder, Securities may be exchanged for other
Securities of any authorized denominations and of a like aggregate principal
amount, upon surrender of the Securities to be exchanged at such office or
agency. Whenever any Securities are so surrendered for exchange, the Company
shall execute, and the Trustee, upon receipt of a Company Order for
authentication, shall authenticate and make available for delivery, the
Securities which the Holder making the exchange is entitled to receive.
All Securities issued upon any registration of transfer or exchange
of Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the Securities
surrendered upon such registration of transfer or exchange.
Every Security presented or surrendered for registration of transfer
or for exchange shall (if so required by the Company) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Company, duly executed by the Holder thereof or his attorney duly authorized in
writing.
No service charge shall be made for any registration of transfer or
exchange of Securities, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Securities, other than
exchanges pursuant to Sections 304, 906 or 1208 not involving any transfer.
If the Securities are to be redeemed in part, the Company shall not
be required (A) to issue, register the transfer of or exchange any Securities
during a period beginning at the opening of business 15 days before the day of
the mailing of a notice of redemption of any such Securities selected for
redemption under Section 1204 and ending at the close of business on the day of
such mailing, or (B) to register the transfer of or exchange any Security so
<PAGE> 29
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selected for redemption in whole or in part, except the unredeemed portion of
any Security being redeemed in part.
So long as the Securities are eligible for book-entry settlement with
the Depositary, or unless otherwise required by law, all Securities to be traded
on the PORTAL Market shall be represented by the Restricted Global Security
registered in the name of the Depositary or the nominee of the Depositary.
The transfer and exchange of beneficial interests in any Global
Security, which does not involve the issuance of a definitive Security or the
transfer of interests to another Global Security, shall be effected through the
Depositary (but not the Trustee or the Custodian) in accordance with this
Indenture (including the restrictions on transfer set forth herein) and the
procedures of the Depositary therefor. Neither the Trustee nor the Custodian (in
such respective capacities) will have any responsibility for the transfer and
exchange of beneficial interests in such Global Security that does not involve
the issuance of a definitive Security or the transfer of interests to another
Global Security.
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security is surrendered to the Trustee, the Company
shall execute and the Trustee, upon receipt of a Company Order for the
authentication, shall authenticate and make available for delivery in exchange
therefor a new Security of like tenor and principal amount and bearing a number
not contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any Security
and (ii) such security or indemnity as may be required by them to save each of
them and any agent of either of them harmless, then, in the absence of notice to
the Company or the Trustee that such Security has been acquired by a bona fide
purchaser, the Company shall execute and the Trustee shall, upon receipt of a
Company Order for the authentication, authenticate and make available for
delivery, in lieu of any such destroyed, lost or stolen Security, a new Security
of like tenor and principal amount and bearing a number not contemporaneously
outstanding.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, the Company in its discretion may,
subject to the preceding paragraph, pay such Security instead of issuing a new
Security.
Upon the issuance of any new Security under this Section, the Company
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee and its agents and
counsel) connected therewith.
Every new Security issued pursuant to this Section in lieu of any
destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by
<PAGE> 30
21
anyone, and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Securities duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities.
SECTION 307. Payment of Interest; Interest Rights Preserved.
Interest on any Security which is payable, and is punctually paid or
duly provided for, on any Interest Payment Date shall be paid to the Person in
whose name that Security (or one or more Predecessor Securities) is registered
at the close of business on the Regular Record Date for such interest.
Any interest on any Security which is payable, but is not punctually
paid or duly provided for, on any Interest Payment Date (herein called
"Defaulted Interest") shall forthwith cease to be payable to the Holder on the
relevant Regular Record Date by virtue of having been such Holder, and such
Defaulted Interest may be paid by the Company, at its election in each case, as
provided in clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted Interest
to the Persons in whose names the Securities (or their respective Predecessor
Securities) are registered at the close of business on a Special Record Date for
the payment of such Defaulted Interest, which shall be fixed in the following
manner. The Company shall notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on each Security and the date of the
proposed payment, and at the same time the Company shall deposit with the
Trustee an amount of money equal to the aggregate amount proposed to be paid in
respect of such Defaulted Interest or shall make arrangements satisfactory to
the Trustee for such deposit prior to the date of the proposed payment, such
money when deposited to be held in trust for the benefit of the Persons entitled
to such Defaulted Interest as in this clause provided. Thereupon the Trustee
shall fix a Special Record Date for the payment of such Defaulted Interest which
shall be not more than 15 days and not less than 10 days prior to the date of
the proposed payment and not less than 10 days after the receipt by the Trustee
of the notice of the proposed payment. The Trustee shall promptly notify the
Company of such Special Record Date and, in the name and at the expense of the
Company, shall cause notice of the proposed payment of such Defaulted Interest
and the Special Record Date therefor to be mailed, first-class postage prepaid,
to each Holder at his address as it appears in the Security Register, not less
than 10 days prior to such Special Record Date. Notice of the proposed payment
of such Defaulted Interest and the Special Record Date therefor having been so
mailed, such Defaulted Interest shall be paid to the Persons in whose names the
Securities (or their respective Predecessor Securities) are registered at the
close of business on such Special Record Date and shall no longer be payable
pursuant to the following clause (2).
<PAGE> 31
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(2) The Company may make payment of any Defaulted Interest in any
other lawful manner not inconsistent with the requirements of any securities
exchange on which the Securities may be listed, and if so listed, upon such
notice as may be required by such exchange, if, after written notice given by
the Company to the Trustee of the proposed payment pursuant to this clause, such
manner of payment shall be deemed practicable by the Trustee in its sole
discretion. Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Security shall carry the rights to interest accrued
and unpaid, and to accrue which, which were carried by such other Security.
In the event that a Registration Default (as defined in the
Registration Rights Agreement) occurs, additional interest ("Additional
Interest") shall become payable in respect of the Securities in an amount equal
to .25% per annum per $1,000 principal amount of Securities held by any Holder.
The amount of Additional Interest will not exceed .25% per annum regardless of
the number of Registration Defaults.
SECTION 308. Persons Deemed Owners.
Prior to due presentment of a Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee shall treat
the Person in whose name such Security is registered as the owner of such
Security for the purpose of receiving payment of principal of and (subject to
Section 307) interest on such Security and for all other purposes whatsoever,
whether or not such Security be overdue, and neither the Company, the Trustee
nor any officer, director, employee or agent of the Company or the Trustee shall
be affected by notice to the contrary.
SECTION 309. Cancellation.
All Securities surrendered for payment, redemption, registration of
transfer or exchange shall, if surrendered to any Person other than the Trustee,
be delivered to the Trustee and shall be promptly cancelled by it. The Company
may at any time deliver to the Trustee for cancellation any Securities
previously authenticated and delivered hereunder which the Company may have
acquired in any manner whatsoever, and all Securities so delivered shall be
promptly cancelled by the Trustee. No Securities shall be authenticated in lieu
of or in exchange for any Securities cancelled as provided in this Section,
except as expressly permitted by this Indenture. All cancelled Securities held
by the Trustee shall be disposed of in a manner customary to the Trustee,
provided, however, that the Trustee may but shall not be required to destroy
such Securities. If the Company shall acquire any of the Securities, however,
such acquisition shall not operate as a redemption or satisfaction of the
Indebtedness represented by such Securities unless and until the same are
surrendered to the Trustee for cancellation.
<PAGE> 32
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SECTION 310. Computation of Interest.
The Company shall appoint a Calculation Agent, which may be the
Trustee, to determine LIBOR as of the Determination Date for each quarterly
interest period and to calculate the interest rate and the amount of interest
due for each such interest period. Absent manifest error, the Calculation
Agent's determination of LIBOR and its calculation of the interest rate for each
interest period shall be final and binding on the holders of the Securities.
Interest on the Securities shall be computed on the basis of the
actual number of days elapsed in a year of twelve 30-day months. The amount of
interest payable for any period shorter than a full quarterly period for which
interest is computed will be computed on the basis of actual number of days
elapsed in such 90-day quarterly period.
SECTION 311. Right of Set-off.
Notwithstanding anything to the contrary in the Indenture, the
Company shall have the right to set-off any payment it is otherwise required to
make thereunder to the extent the Company has theretofore made, or is
concurrently on the date of such payment making, a related payment under the
Guarantee.
SECTION 312. CUSIP Numbers.
The Company in issuing the Securities may use "CUSIP" numbers (if
then generally in use), and, if so, the Trustee shall use "CUSIP" numbers in
notices of redemption as a convenience to Holders; provided that any such notice
may state that no representation is made as to the correctness of such numbers
either as printed on the Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Securities, and any such redemption shall not be affected
by any defect in or omission of such numbers. The Company shall promptly notify
the Trustee of any change in the "CUSIP" numbers.
SECTION 313. Global Securities.
If the Securities are distributed to the holders of Capital
Securities, such Securities distributed in respect of Capital Securities that
are held in global form by a Depositary will initially be issued as a Global
Security, unless such transfer cannot be effected through book-entry settlement.
If the Company shall establish that the Securities are to be issued in the form
of one or more Global Securities, then the Company shall execute and the Trustee
shall, in accordance with Section 303 and the Company Order, authenticate and
deliver one or more Global Securities that (i) shall represent and shall be
denominated in an amount equal to the aggregate principal amount of all of the
Securities to be issued in the form of Global Securities and not yet cancelled,
(ii) shall be registered in the name of the Depositary for such Global Security
or Securities or the nominee of such Depositary, and (iii) shall be delivered by
the Trustee to such Depositary or pursuant to such Depositary's instructions.
Global Securities shall bear a legend substantially to the following effect:
<PAGE> 33
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"This Security is a Global Security within the meaning of the
Indenture hereinafter referred to and is registered in the name of a Depositary
or a nominee of a Depositary. Notwithstanding the provisions of Section 305,
unless and until it is exchanged in whole or in part for Securities in
definitive registered form, a Global Security representing all or a part of the
Securities may not be transferred in the manner provided in Section 305 except
as a whole by the Depositary to a nominee of such Depositary or by a nominee of
such Depositary to such Depositary or another nominee of such Depositary or by
such Depositary or any such nominee to a successor Depositary or a nominee of
such successor Depositary. Every Security delivered upon registration or
transfer of, or in exchange for, or in lieu of, this Global Security shall be a
Global Security subject to the foregoing, except in the limited circumstances
described above. Unless this certificate is presented by an authorized
representative of The Depository Trust Company, a New York corporation ("DTC"),
to the Company or its agent for registration of transfer, exchange or payment,
and any certificate issued is registered in the name of Cede & Co. or in such
other name as is requested by an authorized representative of DTC (and any
payment is to be made to Cede & Co. or to such other entity as is requested by
an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the
registered owner hereof, Cede & Co., has an interest herein."
Definitive Securities issued in exchange for all or a part of a
Global Security pursuant to this Section 313 shall be registered in such names
and in such authorized denominations as the Depositary, pursuant to instructions
from its direct or indirect participants or otherwise, shall instruct the
Trustee in writing. Upon execution and authentication, the Security Registrar
shall deliver such definitive Securities to the persons in whose names such
definitive Securities are so registered.
At such time as all interests in Global Securities have been
redeemed, repurchased or canceled, such Global Securities shall be, upon receipt
thereof, canceled by the Trustee in accordance with its standing procedures in
effect from time to time and instructions existing between the Depositary and
the Trustee. At any time prior to such cancellation, if any interest in Global
Securities is exchanged for definitive Securities, redeemed, canceled or
transferred to a transferee who receives definitive Securities therefor or any
definitive Security is exchanged or transferred for part of Global Securities,
the principal amount of such Global Securities shall, in accordance with the
standing procedures and instructions existing between the Depositary and the
Custodian, be reduced or increased, as the case may be, and an endorsement shall
be made on such Global Securities by the Trustee or the Custodian, at the
direction of the Trustee, to reflect such reduction or increase.
The Company and the Trustee may for all purposes, including the
making of payments due on the Securities, deal with the Depositary as the
authorized representative of the Holders for the purposes of exercising the
rights of Holders hereunder. The rights of the owner of any beneficial interest
in a Global Security shall be limited to those established by law and agreements
between such owners and depository participants or Euroclear and Cedel;
provided, that no such agreement shall give any rights to any person against the
Company or
<PAGE> 34
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the Trustee or its officers, directors, employees and agents, without the
written consent of the parties so affected. Multiple requests and directions
from and votes of the Depositary as holder of Securities in global form with
respect to any particular matter shall not be deemed inconsistent to the extent
they do not represent an amount of Securities in excess of those held in the
name of the Depositary or its nominee.
If at any time the Depositary for any Securities represented by one
or more Global Securities notifies the Company that it is unwilling or unable to
continue as Depositary for such Securities or if at any time the Depositary for
such Securities shall no longer be eligible under this Section 313, the Company
shall appoint a successor Depositary with respect to such Securities. If a
successor Depositary for such Securities is not appointed by the Company within
90 days after the Company receives such notice or becomes aware of such
ineligibility, the Company's election that such Securities be represented by one
or more Global Securities shall no longer be effective and the Company shall
execute, and the Trustee, upon receipt of a Company Order for the authentication
and delivery of definitive Securities, will authenticate and make available for
delivery Securities in definitive registered form, in any authorized
denominations, in an aggregate principal amount equal to the principal amount of
the Global Security or Securities representing such Securities in exchange for
such Global Security or Securities.
The Company may at any time and in its sole discretion determine that
the Securities issued in the form of one or more Global Securities shall no
longer be represented by a Global Security or Securities. In such event the
Company shall execute, and the Trustee, upon receipt of a Company Order for the
authentication and delivery of definitive Securities, shall authenticate and
make available for delivery, Securities in definitive registered form, in any
authorized denominations, in an aggregate principal amount equal to the
principal amount of the Global Security or Securities representing such
Securities, in exchange for such Global Security or Securities.
Notwithstanding any other provisions of this Indenture (other than
the provisions set forth in Section 314(a)), Global Securities may not be
transferred as a whole except by the Depositary to a nominee of the Depositary
or by a nominee of the Depositary to the Depositary or another nominee of the
Depositary or by the Depositary or any such nominee to a successor Depositary or
a nominee of such successor Depositary.
Interests of beneficial owners in Global Security may be transferred
or exchanged for definitive Securities and definitive Securities may be
transferred or exchanged for Global Securities in accordance with rules of the
Depositary.
Any Security in global form may be endorsed with or have incorporated
in the text thereof such legends or recitals or changes not inconsistent with
the provisions of this Indenture as may be required by the Custodian, the
Depositary or by the National Association of Securities Dealers, Inc. in order
for the Securities to be tradeable on the PORTAL Market or as may be required
for the Securities to be tradeable on any other market developed for trading of
securities pursuant to Rule 144A or required to comply with any applicable law
or
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any regulation thereunder or with Regulation S or with the rules and regulations
of any securities exchange upon which the Securities may be listed or traded or
to conform with any usage with respect thereto, or to indicate any special
limitations or restrictions to which any particular Securities are subject.
SECTION 314. Restrictive Legend.
(a) Each Global Security and definitive Security that constitutes a
Restricted Security shall bear the following legend (the "Private Placement
Legend") on the face thereof until three years after the later of the date of
original issue and the last date on which the Company or any Affiliate of the
Company was the owner of such Capital Securities (or any predecessor thereto)
(the "Resale Restriction Termination Date"), unless otherwise agreed by the
Company and the Holder thereof:
"THIS SECURITY (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS AND NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION
HEREIN MAY BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS
SECURITY IS HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION
FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE
144A, REGULATION S OR ANOTHER EXEMPTION THEREUNDER. THE HOLDER OF THIS
SECURITY, BY ITS ACCEPTANCE HEREOF, REPRESENTS, ACKNOWLEDGES AND AGREES FOR
THE BENEFIT OF THE COMPANY THAT: (I) IT HAS ACQUIRED A "RESTRICTED"
SECURITY WHICH HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT; OR (II) IT
WILL NOT OFFER, SELL OR OTHERWISE TRANSFER THIS SECURITY PRIOR TO THE LATER
OF THE DATE WHICH IS THREE YEARS AFTER THE DATE OF ORIGINAL ISSUANCE HEREOF
AND THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS
THE OWNER OF SUCH RESTRICTED SECURITIES (OR ANY PREDECESSOR) EXCEPT (A) TO
THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN
DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THIS
SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON WHO THE
SELLER REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED
IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (D) OUTSIDE THE UNITED STATES IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT, (E) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR," WITHIN THE MEANING OF SUBPARAGRAPH
(A)(1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT IS
ACQUIRING THE SECURITIES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN
INSTITUTIONAL
<PAGE> 36
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"ACCREDITED INVESTOR," FOR INVESTMENT PURPOSES AND NOT WITH A VIEW
TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION
OF THE SECURITIES ACT OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND, IN EACH CASE, IN
ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES OR ANY APPLICABLE JURISDICTION; AND (III) IT WILL, AND EACH
SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THIS
SECURITY OF THE RESALE RESTRICTIONS SET FORTH IN (II) ABOVE. ANY OFFER,
SALE OR OTHER DISPOSITION PURSUANT TO THE FOREGOING CLAUSES (II)(D), (E)
AND (F) IS SUBJECT TO THE RIGHT OF THE ISSUER OF THIS SECURITY AND THE
PROPERTY TRUSTEE FOR SUCH SECURITIES TO REQUIRE THE DELIVERY OF AN OPINION
OF COUNSEL, CERTIFICATIONS OR OTHER INFORMATION ACCEPTABLE TO THEM IN FORM
AND SUBSTANCE."
Any Security (or security issued in exchange or substitution
therefor) as to which such restrictions on transfer shall have expired in
accordance with their terms may, upon satisfaction of the requirements of
Section 314(b) and surrender of such Security for exchange to the Security
Registrar in accordance with the provisions of this Section 314, be exchanged
for a new Security or Securities, of like tenor and aggregate principal amount,
which shall not bear the restrictive legend required by this Section 314(a).
(b) Upon any sale or transfer of any Restricted Security (including
any interest in a Global Security) (i) that is effected pursuant to an effective
registration statement under the Securities Act or (ii) in connection with which
the Trustee receives certificates and other information (including an opinion of
counsel, if requested) reasonably acceptable to the Company to the effect that
such security will no longer be subject to the resale restrictions under federal
and state securities laws, then (A) in the case of a Restricted Security in
definitive form, the Security Registrar or co-Registrar shall permit the holder
thereof to exchange such Restricted Security for a Security that does not bear
the legend set forth in Section 314(a), and shall rescind any such restrictions
on transfer and (B) in the case of Restricted Securities represented by a Global
Security, such Security shall no longer be subject to the restrictions contained
in the legend set forth in Section 314(a) (but still subject to the other
provisions hereof). In addition, any Security (or Security issued in exchange or
substitution therefor) as to which the restrictions on transfer described in the
legend set forth in Section 314(a) have expired by their terms, may, upon
surrender thereof (in accordance with the terms of this Indenture) together with
such certifications and other information (including an Opinion of Counsel
having substantial experience in practice under the Securities Act and otherwise
reasonably acceptable to the Company, addressed to the Company and the Trustee
and in a form acceptable to the Company, to the effect that the transfer of such
Restricted Security has been made in compliance with Rule 144 or such successor
provision) acceptable to the Company and the Trustee as either of them may
reasonably require, be exchanged for a new Security or Securities of like tenor
and aggregate principal amount, which shall not bear the restrictive legends set
forth in Section 314(a). The Trustee shall
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receive a certificate (a form of which is attached to the Junior Subordinated
Debenture in Exhibit A hereto), upon which the Trustee may conclusively rely,
from the Person transferring such Restricted Security, stating that such
transferor satisfies the requirements of this Section 314 and that all
conditions precedent required for such transfer have occurred.
SECTION 315. Special Transfer Provisions.
At any time at the request of the beneficial holder of an interest in
a Security in global form, such beneficial holder shall be entitled to obtain a
definitive Security upon written request to the Trustee in accordance with the
standing instructions and procedures existing between the Depositary and the
Trustee for the issuance thereof. Upon receipt of any such request, the Trustee
will cause the aggregate principal amount of the Security in global form to be
reduced and, following such reduction, the Company will execute and, upon
receipt of a Company Order for the authentication, the Trustee will authenticate
and deliver to such beneficial holder (or its nominee) a Security or Securities
in the appropriate aggregate principal amount in the name of such beneficial
holder (or its nominee) and bearing such restrictive legends as may be required
by this Indenture.
Any transfer of a beneficial interest in a Security in global form
which cannot be effected through book-entry settlement must be effected by the
delivery to the transferee (or its nominee) of a definitive Security or
Securities registered in the name of the transferee (or its nominee) on the
books maintained by the Trustee. With respect to any such transfer, the Trustee
will cause, in accordance with the standing instructions and procedures existing
between the Depositary and the Trustee, the aggregate principal amount of the
Security in global form to be reduced and, following such reduction, the Company
will execute and the Trustee, upon receipt of a Company Order for the
authentication, will authenticate and deliver to the transferee (or such
transferee's nominee, as the case may be), a Security or Securities in the
appropriate aggregate principal amount in the name of such transferee (or its
nominee) and bearing such restrictive legends as may be required by this
Indenture. In connection with any such transfer, the Trustee may request a
certificate (a form of which is attached to the Junior Subordinated Debenture in
Exhibit A hereto), upon which the Trustee may conclusively rely, containing such
representations and agreements relating to the restrictions on transfer of such
Security or Securities from such transferee (or such transferee's nominee) as
the Trustee may reasonably require.
So long as the Securities are eligible for book-entry settlement, or
unless otherwise required by law, upon any transfer of a definitive Security to
a QIB in accordance with Rule 144A, unless otherwise requested by the
transferor, and upon receipt of the definitive Security or Securities being so
transferred, together with a certification from the transferor that the
transferor reasonably believes that the transferee is a QIB, upon which
certification the Trustee may conclusively rely, the Trustee shall make an
endorsement on the Restricted Global Security to reflect an increase in the
aggregate principal amount of the Securities represented by the Restricted
Global Security, the Trustee shall cancel such definitive Security or Securities
and cause, in accordance with the standing instructions and
<PAGE> 38
29
procedures existing between the Depositary and the Trustee, the aggregate
principal amount of Securities represented by the Restricted Global Security to
be increased accordingly.
So long as the Securities are eligible for book-entry settlement, or
unless otherwise required by law, upon any transfer of a definitive Security in
accordance with Regulation S, if requested by the transferor, and upon receipt
of the definitive Security or Securities being so transferred, together with a
certification from the transferor that the transfer was made in accordance with
Rule 903 or 904 of Regulation S or Rule 144 under the Securities Act, the
Trustee shall make or direct the Custodian to make, an endorsement on the
Regulation S Global Security to reflect an increase in the aggregate principal
amount of the Securities represented by the Regulation S Global Security, the
Trustee shall cancel such definitive Security or Securities and cause, or direct
the Custodian to cause, in accordance with the standing instructions and
procedures existing between the Depositary and the Custodian, the aggregate
principal amount of Securities represented by the Regulation S Global Security
to be increased accordingly.
If a holder of a beneficial interest in the Restricted Global
Security wishes at any time to exchange its interest in the Restricted Global
Security for an interest in the Regulation S Global Security, or to transfer its
interest in the Restricted Global Security to a person who wishes to take
delivery thereof in the form of an interest in the Regulation S Global Security,
such holder may, subject to the rules and procedures of the Depositary and to
the requirements set forth in the following sentence, exchange or cause the
exchange or transfer or cause the transfer of such interest for an equivalent
beneficial interest in the Regulation S Global Security. Upon receipt by the
Trustee, as transfer agent of (1) instructions given in accordance with the
Depositary's procedures from or on behalf of a holder of a beneficial interest
in the Restricted Global Security, directing the Trustee (via DWAC), as transfer
agent, to credit or cause to be credited a beneficial interest in the Regulation
S Global Security in an amount equal to the beneficial interest in the
Restricted Global Security to be exchanged or transferred, (2) a written order
given in accordance with the Depositary's procedures containing information
regarding the Euroclear or Cedel account to be credited with such increase and
the name of such account, and (3) a certificate (a form of which is attached to
the Junior Subordinated Debenture in Exhibit A hereto), upon which the Trustee
may conclusively rely, given by the holder of such beneficial interest stating
that the exchange or transfer of such interest has been made pursuant to and in
accordance with Rule 903 or Rule 904 of Regulation S or Rule 144 under the
Securities Act, the Trustee, as transfer agent, shall promptly deliver
appropriate instructions to the Depositary (via DWAC), its nominee, or the
custodian for the Depositary, as the case may be, to reduce or reflect on its
records a reduction of the Restricted Global Security by the aggregate principal
amount of the beneficial interest in such Restricted Global Security to be so
exchanged or transferred from the relevant participant, and the Trustee, as
transfer agent, shall promptly deliver appropriate instructions (via DWAC) to
the Depositary, its nominee, or the custodian for the Depositary, as the case
may be, concurrently with such reduction, to increase or reflect on its records
an increase of the principal amount of such Regulation S Global Security by the
aggregate principal amount of the beneficial interest in such Restricted Global
Security to be so exchanged or transferred, and to credit or cause to be
credited to the account of the person
<PAGE> 39
30
specified in such instructions (who may be Morgan Guaranty Trust Company of New
York, Brussels office, as operator of Euroclear or Cedel or another agent member
of Euroclear or Cedel, or both, as the case may be, acting for and on behalf of
them) a beneficial interest in such Regulation S Global Security equal to the
reduction in the principal amount of such Restricted Global Security.
If a holder of a beneficial interest in the Regulation S Global
Security wishes at any time to exchange its interest in the Regulation S Global
Security for an interest in the Restricted Global Security, or to transfer its
interest in the Regulation S Global Security to a person who wishes to take
delivery thereof in the form of an interest in the Restricted Global Security,
such holder may, subject to the rules and procedures of Euroclear or Cedel and
the Depositary, as the case may be, and to the requirements set forth in the
following sentence, exchange or cause the exchange or transfer or cause the
transfer of such interest for an equivalent beneficial interest in such
Restricted Global Security. Upon receipt by the Trustee, as transfer agent of
(1) instructions given in accordance with the procedures of Euroclear or Cedel
and the Depositary, as the case may be, from or on behalf of a beneficial owner
of an interest in the Regulation S Global Security directing the Trustee, as
transfer agent, to credit or cause to be credited a beneficial interest in the
Restricted Global Security in an amount equal to the beneficial interest in the
Regulation S Global Security to be exchanged or transferred, (2) a written order
given in accordance with the procedures of Euroclear or Cedel and the
Depositary, as the case may be, containing information regarding the account
with the Depositary to be credited with such increase and the name of such
account, and (3) prior to the expiration of the Restricted Period, a certificate
(a form of which is attached to the Junior Subordinated Debenture in Exhibit A
hereto), upon which the Trustee may conclusively rely, given by the holder of
such beneficial interest and stating that the person transferring such interest
in such Regulation S Global Security reasonably believes that the person
acquiring such interest in the Restricted Global Security is a QIB and is
obtaining such beneficial interest in a transaction meeting the requirements of
Rule 144A and any applicable securities laws of any state of the United States
or any other jurisdiction, the Trustee, as transfer agent, shall promptly
deliver (via DWAC) appropriate instructions to the Depositary, its nominee, or
the custodian for the Depositary, as the case may be, to reduce or reflect on
its records a reduction of the Regulation S Global Security by the aggregate
principal amount of the beneficial interest in such Regulation S Global Security
to be exchanged or transferred, and the Trustee, as transfer agent, shall
promptly deliver (via DWAC) appropriate instructions to the Depositary, its
nominee, or the custodian for the Depositary, as the case may be, concurrently
with such reduction, to increase or reflect on its records an increase of the
principal amount of the Restricted Global Security by the aggregate principal
amount of the beneficial interest in the Regulation S Global Security to be so
exchanged or transferred, and to credit or cause to be credited to the account
of the person specified in such instructions a beneficial interest in the
Restricted Global Security equal to the reduction in the principal amount of the
Regulation S Global Security. After the expiration of the Restricted Period (as
defined below), the certification requirement set forth in clause (3) of the
second sentence of the above paragraph will no longer apply to such exchanges
and transfers.
<PAGE> 40
31
If a holder of a definitive Security wishes at any time to exchange
its Security for a beneficial interest in any Global Security (or vice versa),
or to transfer its definitive Security to a person who wishes to take delivery
thereof in the form of a beneficial interest in a Global Security (or vice
versa), such Securities and beneficial interests may be exchanged or transferred
for one another only in accordance with such procedures as are substantially
consistent with the provisions of the two preceding paragraphs (including the
certification requirements intended to ensure that such exchanges or transfers
comply with Rule 144, Rule 144A or Regulation S, as the case may be) and as may
be from time to time adopted by the Company and the Trustee.
Any beneficial interest in one of the Global Securities that is
transferred to a person who takes delivery in the form of an interest in the
other Global Security will, upon transfer, cease to be an interest in such
Global Security and become an interest in the other Global Security and,
accordingly, will thereafter be subject to all transfer restrictions and other
procedures applicable to beneficial interests in such other Global Security for
as long as it remains such an interest.
Prior to or on the 40th day after the later of the commencement of
the offering of the Capital Securities and the Closing Date (the "Restricted
Period"), beneficial interests in a Regulation S Global Security may only be
held through Morgan Guaranty Trust Company of New York, Brussels Office, as
operator of Euroclear or Cedel or another agent member of Euroclear and Cedel
acting for and on behalf of them, unless delivery is made through the Restricted
Global Security in accordance with the certification requirements hereof. During
the Restricted Period, interests in the Regulation S Global Security, if any,
may be exchanged for interests in the Restricted Global Security or for
definitive Securities only in accordance with the certification requirements
described above.
ARTICLE FOUR
SATISFACTION AND DISCHARGE; DEFEASANCE
SECTION 401. Satisfaction and Discharge of Indenture.
This Indenture shall cease to be of further effect (except as to any
surviving rights of registration of transfer or exchange of Securities herein
expressly provided for), and the Trustee, on written demand of and at the
expense of the Company, shall execute instruments supplied by the Company
acknowledging satisfaction and discharge of this Indenture, when (1) either (A)
all Securities theretofore authenticated and delivered (other than (i)
Securities which have been destroyed, lost or stolen and which have been
replaced or paid as provided in Section 306 and (ii) Securities for whose
payment money has theretofore been deposited in trust or segregated and held in
trust by the Company and thereafter repaid to the Company or discharged from
such trust, as provided in Section 1003) have been delivered to the Trustee for
cancellation; or (B) all such Securities not theretofore delivered to the
Trustee for cancellation (i) have become due and payable, or (ii) will become
due and payable at their Maturity within one year, or (iii) if redeemable at the
option of the Company, are to be called
<PAGE> 41
32
for redemption within one year under arrangements satisfactory to the Trustee
for the giving of notice of redemption by the Trustee in the name, and of the
expense, of the Company and the Company, in the case of (i), (ii) or (iii)
above, has deposited or caused to be deposited with the Trustee as funds in
trust for the purpose an amount sufficient to pay and discharge the entire
indebtedness on such Securities not theretofore delivered to the Trustee for
cancellation, for principal and interest to the date of such deposit (in the
case of Securities which have become due and payable) or to the Maturity or
Redemption Date, as the case may be; (2) the Company has paid or caused to be
paid all other sums payable hereunder by the Company; and (3) the Company has
delivered to the Trustee an Officers' Certificate and an Opinion of Counsel,
each stating that all conditions precedent herein provided for relating to the
satisfaction and discharge of this Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 607 and, if money shall
have been deposited with the Trustee pursuant to subclause (B) of clause (1) of
this Section, the obligations of the Trustee under Section 402 and the last
paragraph of Section 1003 shall survive.
SECTION 402. Legal Defeasance.
In addition to discharge of this Indenture pursuant to Section 401,
in the case of any Securities with respect to which the exact amount described
in subparagraph (a) of Section 404 can be determined at the time of making the
deposit referred to in such subparagraph (a), the Company shall be deemed to
have paid and discharged the entire indebtedness on all the Securities as
provided in this Section on and after the date the conditions set forth in
Section 404 are satisfied, and the provisions of this Indenture with respect to
the Securities shall no longer be in effect (except as to (i) rights of
registration of transfer and exchange of Securities, (ii) substitution of
mutilated, defaced, destroyed, lost or stolen Securities, (iii) maintenance of a
Paying Agent, (iv) rights of Holders of Securities to receive, solely from the
trust fund described in subparagraph (a) of Section 404, payments of principal
thereof and interest, if any, thereon upon the original stated due dates
therefor (but not upon acceleration), (v) the rights, obligations, duties and
immunities of the Trustee hereunder, (vi) this Section 402 and (vii) the rights
of the Holders of Securities as beneficiaries hereof with respect to the
property so deposited with the Trustee payable to all or any of them)
(hereinafter called "Legal Defeasance"), and the Trustee, at the cost and
expense of the Company, shall acknowledge the same.
SECTION 403. Covenant Defeasance.
In the case of any Securities with respect to which the exact amount
described in subparagraph (a) of Section 404 can be determined at the time of
making the deposit referred to in such subparagraph (a), (x) the Company shall
be released from its obligations under any covenants specified in or pursuant to
this Indenture (except as to (i) rights of registration of transfer and exchange
of Securities, (ii) substitution of mutilated, defaced, destroyed, lost or
stolen Securities, (iii) maintenance of a Paying Agent, (iv) rights of Holders
of Securities to receive, from the Company pursuant to Section 1001, payments of
principal thereof and interest, if any, thereon upon the original stated due
dates therefor (but not upon acceleration),
<PAGE> 42
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(v) the rights, obligations, duties and immunities of the Trustee hereunder and
(vi) the rights of the Holders of Securities as beneficiaries hereof with
respect to the property so deposited with the Trustee payable to all or any of
them), and (y) the occurrence of any event specified in Section 501(3) (with
respect to any of the covenants specified in or pursuant to this Indenture)
shall be deemed not to be or result in an Event of Default, in each case with
respect to the Outstanding Securities as provided in this Section on and after
the date the conditions set forth in Section 404 are satisfied (hereinafter
called "Covenant Defeasance"), and the Trustee, at the cost and expense of the
Company, shall acknowledge the same. For this purpose, such Covenant Defeasance
means that the Company may omit to comply with and shall have no liability in
respect of any term, condition or limitation set forth in any such covenant (to
the extent so specified in the case of Section 501(3)), whether directly or
indirectly by reason of any reference elsewhere herein to any such covenant or
by reason of any reference in any such covenant to any other provision herein or
in any other document, but the remainder of this Indenture and the Securities
shall be unaffected thereby.
SECTION 404. Conditions to Legal Defeasance or Covenant Defeasance.
The following shall be the conditions to application of either
Section 402 or 403 to the Outstanding Securities:
(a) with reference to Section 402 or 403, the Company has irrevocably
deposited or caused to be irrevocably deposited with the Trustee as funds
in trust, specifically pledged as security for, and dedicated solely to,
the benefit of the Holders of Securities (i) cash in an amount, (ii) direct
obligations of the United States of America, backed by its full faith and
credit ("U.S. Government Obligations"), maturing as to principal and
interest, if any, at such times and in such amounts as will ensure the
availability of cash, (iii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United
States of America the timely payment of which is unconditionally guaranteed
as a full faith and credit obligation by the United States of America, or
(iv) a combination thereof, in each case sufficient, in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee, to pay and
discharge the principal of and interest, if any, on all Securities on each
date that such principal or interest, if any, is due and payable;
(b) in the case of Legal Defeasance under Section 402, the Company
has delivered to the Trustee an Opinion of Counsel based on the fact that
(x) the Company has received from, or there has been published by, the
Internal Revenue Service a ruling or (y), since the date hereof, there has
been a change in the applicable United States federal income tax law, in
either case to the effect that, and such opinion shall confirm that, the
Holders of the Securities of such series will not recognize income, gain or
loss for federal income tax purposes as a result of such deposit and Legal
Defeasance and will be subject to federal income tax on the same amount and
in the same manner and at the same times as would have been the case if
such deposit and Legal Defeasance had not occurred;
<PAGE> 43
34
(c) in the case of Covenant Defeasance under Section 403, the Company
has delivered to the Trustee an Opinion of Counsel to the effect that, and
such opinion shall confirm that, the Holders of the Securities will not
recognize income, gain or loss for federal income tax purposes as a result
of such deposit and Covenant Defeasance and will be subject to federal
income tax on the same amount in the same manner and at the same times as
would have been the case if such deposit and Covenant Defeasance had not
occurred;
(d) such Legal Defeasance or Covenant Defeasance will not result in a
breach or violation of, or constitute a default under, any agreement or
instrument to which the Company is a party or by which it is bound; and
(e) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent contemplated by this provision have been complied with.
SECTION 405. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 1003, all
money and U.S. Government Obligations deposited with the Trustee pursuant to
Section 401 shall be held in trust and such money and all money from such U.S.
Government Obligations shall be applied by it, in accordance with the provisions
of the Securities and this Indenture, to the payment, either directly or through
any Paying Agent (including the Company acting as its own Paying Agent), as the
Trustee may determine in its sole discretion, to the Persons entitled thereto,
of the principal and interest for whose payment such money and U.S. Government
Obligations has been deposited with the Trustee.
SECTION 406. Indemnity for U.S. Government Obligations.
The Company shall pay and indemnify the Trustee and its officers,
directors, employees and agents against any tax, fee or other charge imposed on
or assessed against the U.S. Government Obligations deposited pursuant to
Section 404 or the principal or interest received in respect of such obligations
other than any such tax, fee or other charge that by law is for the account of
the Holders of Outstanding Securities.
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default.
"Event of Default" wherever used herein, means any one of the
following events that has occurred and is continuing (whatever the reason for
such Event of Default and whether it shall be occasioned by the provisions of
Article Eleven or be voluntary or
<PAGE> 44
35
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(1) failure for 30 days to pay any interest on the Securities when
due (subject to the deferral of any due date in the case of an Extension
Period); or
(2) failure to pay any principal on the Securities when due, whether
at Maturity, upon redemption, by declaration of acceleration or otherwise;
(3) failure to observe or perform in any material respect any other
covenant herein that continues 90 days after written notice to the Company from
the Trustee or the holders of at least 25% in aggregate principal amount of the
Outstanding Securities; or
(4) the entry of a decree or order by a court having jurisdiction in
the premises adjudging the Company a bankrupt or insolvent, or approving as
properly filed a petition seeking reorganization, arrangement, adjustment or
composition of or in respect of the Company under any applicable federal or
state bankruptcy, insolvency, reorganization or other similar law, or appointing
a receiver, liquidator, assignee, trustee, sequestrator (or other similar
official) of the Company or of any substantial part of its property or ordering
the winding up or liquidation of its affairs, and the continuance of any such
decree or order unstayed and in effect for a period of 90 consecutive days; or
(5) the institution by the Company of proceedings to be adjudicated a
bankrupt or insolvent, or the consent by it to the institution of bankruptcy or
insolvency proceedings against it, or the filing by it of a petition or answer
or consent seeking reorganization or relief under any applicable federal or
state bankruptcy, insolvency, reorganization or other similar law, or the
consent by it to the filing of any such petition or to the appointment of a
receiver, liquidator, assignee, trustee, sequestrator (or other similar
official) of the Company or of any substantial part of its property, or the
making by it of an assignment for the benefit for creditors, or the admission by
it in writing of its inability to pay its debts generally as they become due and
its willingness to be adjudicated a bankrupt, or the taking of corporate action
by the Company in furtherance of any such action
SECTION 502. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default occurs and is continuing, then and in every
such case the Trustee or the Holders of not less than 25% in aggregate principal
amount of the Outstanding Securities may declare the principal of and the
interest on all the Securities and any other amounts payable hereunder to be due
and payable immediately, provided, however, that if upon an Event of Default,
the Trustee or the Holders of at least 25% in aggregate principal amount of the
Outstanding Securities fail to declare the payment of all amounts on the
Securities to be immediately due and payable, the holders of at least 25% in
aggregate liquidation amount of Capital Securities then outstanding shall have
such right, by a notice in writing to the Company (and to the Trustee if given
by Holders or the holders of Capital
<PAGE> 45
36
Securities) and upon any such declaration such principal and all accrued
interest shall become immediately due and payable.
At any time after such a declaration of acceleration has been made
and before a judgment or decree for payment of the money due has been obtained
by the Trustee as hereinafter provided in this Article, the Holders of a
majority in aggregate principal amount of the Outstanding Securities, by written
notice to the Company and the Trustee, may rescind and annul such declaration
and its consequences if (1) the Company has paid or deposited with the Trustee a
sum sufficient to pay (A) all overdue interest on all Securities, (B) the
principal of (and premium, if any, on) any Securities which have become due
otherwise than by such declaration of acceleration and interest thereon at the
rate borne by the Securities, (C) to the extent that payment of such interest is
lawful, interest upon overdue interest at the rate borne by the Securities, and
(D) all sums paid or advanced by the Trustee hereunder and the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel; and (2) all Events of Default, other than the non-payment of the
principal of Securities which have become due solely by such declaration of
acceleration, have been cured or waived as provided in Section 513. Should the
Holders of such Securities fail to annul such declaration and waive such
default, the holders of a majority in aggregate liquidation amount of the
Capital Securities then outstanding shall have such right. No such rescission
shall affect any subsequent default or impair any right consequent thereon.
SECTION 503. Collection of Indebtedness and Suits for Enforcement by Trustee
The Company covenants that if
(1) default is made in the payment of any interest on any Security
when such interest becomes due and payable and such default continues for a
period of 30 days, or
(2) default is made in the payment of the principal of any Security
at the Maturity thereof,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Securities, the whole amount then due and payable on such
Securities for principal and interest, and, to the extent that payment thereof
shall be legally enforceable, interest on any overdue principal and on any
overdue interest, at the rate borne by the Securities, and, in addition thereto,
such further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.
If an Event of Default occurs and is continuing, the Trustee may in
its discretion proceed to protect and enforce its rights and the rights of the
Holders by such appropriate judicial proceedings as the Trustee shall deem most
effectual to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy.
<PAGE> 46
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SECTION 504. Trustee may File Proofs of Claim.
In case of any receivership, insolvency, liquidation, arrangement,
adjustment, composition or other similar judicial proceeding relative to the
Company (or any other obligor upon the Securities), its property or its
creditors, the Trustee shall be entitled and empowered, by intervention in such
proceeding or otherwise, to take any and all actions authorized under the Trust
Indenture Act in order to have claims of the Holders and the Trustee allowed in
any such proceeding. In particular, the Trustee shall be authorized to collect
and receive any moneys or other property payable or deliverable on any such
claims and to distribute the same; and any custodian, receiver, assignee,
trustee, liquidator, sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each Holder to make such payments to the
Trustee and, in the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay to the Trustee any amount due it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 607. No provision of this Indenture shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement, adjustment or composition affecting the
Securities or the rights of any Holder thereof or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding.
SECTION 505. Trustee may Enforce Claims Without Possession of Securities.
All rights of action and claims under this Indenture or the
Securities may be prosecuted and enforced by the Trust without the possession of
any of the Securities or the production thereof in any proceeding relating
thereto, and any such proceeding instituted by the Trustee shall be brought in
its own name as trustee of any express trust, and any recovery of judgment
shall, after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Securities in respect of which such
judgment has been recovered.
SECTION 506. Application of Money Collected.
Subject to Article Eleven, any money collected by the Trustee
pursuant to this Article shall be applied in the following order, at the date or
dates fixed by the Trustee and, in case of the distribution of such money on
account of principal, upon presentation of the Securities and the notation
thereon of the payment, if only partially paid, and upon surrender thereof, if
fully paid;
FIRST: To the payment of all amounts due the Trustee under Section
607; and
SECOND: To the payment of the amounts then due and unpaid for
principal of and interest on the Securities in respect of which or for the
benefit of which such money has been collected, ratably, without preference or
priority of any kind, according to the amounts due and payable as such
Securities for principal and interest, respectively.
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THIRD: To the Company, if any balance shall remain.
SECTION 507. Limitation on Suits.
No Holder of any Security shall have any right to institute any
proceeding, judicial or otherwise, with respect to this Indenture, or for the
appointment of a receiver or trustee, or for any other remedy hereunder, unless
(1) such Holder has previously given written notice to the Trustee of
a continuing Event of Default;
(2) the Holders of not less than 25% in principal amount of the
Outstanding Securities shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default in its own name as
Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee reasonable
indemnity satisfactory to it against the costs, expenses and liabilities to be
incurred in compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been
given to the Trustee during such 60-day period by the Holders of a majority in
principal amount of the Outstanding Securities; it being understood and intended
that no one or more Holders shall have any right in any manner whatever by
virtue of, or by availing of, any provision of this Indenture to affect, disturb
or prejudice the rights of any other Holders, or to obtain or to seek to obtain
priority or preference over any other Holders or to enforce any right under this
Indenture, except in the manner herein provided and for the equal and ratable
benefit of all the Holders.
SECTION 508. Unconditional Right of Holders to Receive Principal and Interest;
Capital Security Holders' Rights.
Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of and (subject to Section 307) interest on
such Security on the Stated Maturity expressed in such Security (or, in the case
of redemption, on the Redemption Date) and to institute suit for the enforcement
of any such payment, and such rights shall not be impaired without the consent
of such Holder.
If an Event of Default constituting the failure to pay interest or
principal on the Securities on the date such interest or principal is otherwise
payable has occurred and is continuing, then a holder of Capital Securities may
directly institute a proceeding for enforcement of payment to such holder
directly of the principal of or interest on the Securities
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having a principal amount equal to the aggregate liquidation amount of the
Capital Securities as such holder on or after the respective due date specified
in the Securities. The Company may not amend this Section without the prior
written consent of the holders of all of the Capital Securities. Notwithstanding
any payment made to such holder of Capital Securities by the Company in
connection with such a Direct Action (as defined in the Declaration), the
Company shall remain obligated to pay the principal of or interest on the
Securities held by the Trust or the Property Trustee and the Company shall be
subrogated to the rights of the holder of such Capital Securities with respect
to payments on the Capital Securities to the extent of any payments made by the
Company to such holder in any Direct Action (as defined in the Declaration). A
holder of Capital Securities will not be able to exercise directly any other
remedy available to the Holders of the Securities.
SECTION 509. Restoration of Rights and Remedies.
If the Trustee or any Holder has instituted any proceeding to enforce
any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case, subject to any
determination in such proceeding, the Company, the Trustee and the Holders shall
be restored severally and respectively to their former positions hereunder and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.
SECTION 510. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities in the last paragraph
of Section 306, no right or remedy herein conferred upon or reserved to the
Trustee or to the Holders is intended to be exclusive of any other right or
remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.
SECTION 511. Delay or Omission not Waiver.
No delay or omission of the Trustee or of any Holder of any Security
to exercise any right or remedy accruing upon any Event of Default shall impair
any such right or remedy or constitute a waiver of any such Event of Default or
an acquiescence therein. Every right and remedy given by this Article or by law
to the Trustee or to the Holders may be exercised from time to time, and as
often as may be deemed expedient, by the Trustee or by the Holders, as the case
may be.
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SECTION 512. Control by Holders.
The Holders of a majority in principal amount of the Outstanding
Securities shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on the Trustee, provided that
(1) such direction shall not be in conflict with any rule of law or
with this Indenture; and
(2) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
SECTION 513. Waiver of Past Defaults.
Subject to Sections 902 and 1008 hereof, the Holders of not less than
a majority in principal amount of the Outstanding Securities may on behalf of
the Holders of all the Securities waive any past default hereunder and its
consequences, except a default
(1) in the payment of the principal of or interest on any Security
(unless such default has been cured and a sum sufficient to pay all matured
installments of interest and principal due otherwise than by acceleration has
been deposited with the Trustee); or
(2) in respect of a covenant or provision hereof which under Article
Nine cannot be modified or amended without the consent of the Holder of each
Outstanding Security affected;
provided, however, that such waiver or modification to such waiver shall not be
effective until the holders of a majority in liquidation preference of Capital
Securities shall have consented to such waiver or modification to such waiver;
provided further, that if the consent of the Holder of each of the Outstanding
Securities is required, such waiver shall not be effective until each holder of
the Capital Securities shall have consented to such waiver.
Upon any such waiver, such default shall cease to exist, effective as
of the date specified in such waiver (and effective retroactively to the date of
default, if so specified) and any Event of Default arising therefrom shall be
deemed to have been cured, for every purpose of this Indenture; but no such
waiver shall extend to any subsequent or other default or impair any right
consequent thereon.
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SECTION 514. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Indenture, or in any suit against the Trustee for any action taken, suffered or
omitted by it as Trustee, a court may require any party litigant in such suit to
file an undertaking to pay the costs of such suit, and may assess costs against
any such party litigant, in the manner and to the extent provided in the Trust
Indenture Act; provided, that neither this Section nor the Trust Indenture Act
shall be deemed to authorize any court to require such an undertaking or to make
such an assessment in any suit instituted by the Company or the Trustee or in
any suit for the enforcement of the right to receive the principal of and
interest on any Security.
SECTION 515. Waiver of Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
ARTICLE SIX
TRUSTEE
SECTION 601. Certain Duties and Responsibilities.
The duties and responsibilities of the Trustee shall be as provided
by the Trust Indenture Act. Notwithstanding the foregoing, no provision of this
Indenture shall require the Trustee to expend or risk its own funds or otherwise
incur any financial liability in the performance of any of its duties hereunder,
or in the exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity
satisfactory to it against such risk or liability is not reasonably assured to
it. Whether or not therein expressly so provided, every provision of this
Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section.
The Trustee shall not be liable for any error or judgment made in
good faith by a Responsible Officer, unless it shall be proved that the Trustee
was negligent in ascertaining the pertinent facts.
The Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in good faith in accordance with the direction of the
Holders of a majority in
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principal amount of the Outstanding Securities, relating to the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under this Indenture
with respect to the Securities.
SECTION 602. Notice of Defaults.
The Trustee shall give the Holders notice of any default known to it
hereunder as and to the extent provided by the Trust Indenture Act; provided,
however, that except in the case of a default in the payment of the principal of
or interest on any Security, the Trustee shall be protected in withholding such
notice if and so long as the board of directors, the executive committee or a
trust committee of directors and/or Responsible Officers of the Trustee in good
faith determine that the withholding of such notice is in the interests of the
Holders of Securities; provided, further, that in the case of any default of the
character specified in Section 501(3), no such notice to Holders shall be given
until at least 30 days after the occurrence thereof. For the purpose of this
Section, the term "default" means any event which is, or after notice or lapse
of time or both would become, an Event of Default. For purposes of this Section,
the Trustee shall not be deemed to have knowledge of a default unless a
Responsible Officer of the Trustee has actual knowledge of such default or has
received written notice of such default in the manner contemplated by Section
105.
SECTION 603. Certain Rights of Trustee.
Subject to the provisions of Section 601:
(a) the Trustee may conclusively rely and shall be fully protected in
acting or refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed or presented by the proper
party or parties;
(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any resolution
of the Board of Directors shall be sufficiently evidenced by a Board Resolution;
(c) whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other evidence
be herein specifically prescribed) may, in the absence of bad faith on its part,
conclusively rely upon an Officers' Certificate;
(d) the Trustee may consult with counsel of its choice (and such
counsel may be counsel to the Company or any of its Affiliates and may include
any of its employees) and the advice of such counsel or any Opinion of Counsel
shall be full and complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith and in reliance
thereon;
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(e) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders pursuant to this Indenture, unless such Holders shall have
offered to the Trustee reasonable security or indemnity satisfactory to it
against the costs, expenses and liabilities which might be incurred by it in
compliance with such request or direction;
(f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document, but the
Trustee, in its sole discretion, may make such further inquiry or investigation
into such facts or matters as it may see fit, and, if the Trustee shall
determine to make such further inquiry or investigation, it shall be entitled to
examine the books, records and premises of the Company, personally or by agent
or attorney;
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder; and
(h) any application by the Trustee for written instructions from the
Company may, at the option of the Trustee, set forth in writing any action
proposed to be taken or omitted by the Trustee under this Indenture and the date
on and/or after which such action shall be taken or such omission shall be
effective. The Trustee shall not be liable to the Company for any action taken
by, or omission of, the Trustee in accordance with a proposal included in such
application on or after the date specified in such application (which date shall
not be less than five Business Days after the date any officer of the Company
actually receives such application, unless any such officer shall have consented
in writing to any earlier date) unless prior to taking any such action (or the
effective date in the case of an omission), the Trustee shall have received
written instructions in response to such application specifying the action to be
taken or omitted.
SECTION 604. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Indenture or of the Securities, the Trustee shall not be accountable for the use
or application by the Company of Securities or the proceeds thereof.
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SECTION 605. Trustee and Other Agents may Hold Securities.
The Trustee, any Paying Agent, any Security Registrar, or any other
agent of the Company, in its individual or any other capacity, may become the
owner or pledgee of Securities and, subject to Sections 608 and 613, may
otherwise deal with the Company with the same rights it would have if it were
not Trustee, Paying Agent, Security Registrar, or such other agent. Money held
by the Trustee in trust hereunder shall not be invested by the Trustee pending
distribution thereof to the holders of the Securities.
SECTION 606. Money Held in Trust.
Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. The Trustee shall be
under no liability for interest on any money received by it hereunder except as
otherwise agreed in writing with the Company.
SECTION 607. Compensation; Reimbursement; and Indemnity.
The Company, as issuer of the Securities, agrees
(1) to pay to the Trustee from time to time such compensation as the
Company and the Trustee shall from time to time agree in writing for all
services rendered by it hereunder (which compensation shall not be limited by
any provision of law in regard to the compensation of a trustee of an express
trust);
(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and advances
incurred or made by the Trustee in accordance with any provision of this
Indenture (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense, disbursement
or advance as may be attributable to its negligence or bad faith; and
(3) to indemnify each of the Trustee and any predecessor Trustee and
their respective officers, directors, employees and agents, for, and to hold it
harmless against, any and all loss, damage, claim, liability or expense,
including taxes (other than taxes based on the income, revenues or gross
receipts of the Trustee) incurred without negligence or bad faith on its part,
arising out of or in connection with the acceptance or administration of this
trust or the trusts hereunder, including the costs and expenses of defending
itself against any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder.
The obligations of the Company under this Section to compensate the
Trustee, to pay or reimburse the Trustee for expenses, disbursements and
advances and to indemnify and hold harmless the Trustee shall constitute
additional indebtedness hereunder and shall survive the satisfaction and
discharge of this Indenture. As security for the performance of such obligations
of the Company, the Trustee shall have a lien prior to the Securities upon all
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property and lands held or collected by the Trustee as such, except funds held
in trust for the payment of principal of (and premiums, if any, on) or interest
on particular Securities.
When the Trustee incurs expenses or renders services in connection
with an Event of Default specified in Section 501(4) or Section 501(5), the
expenses (including the reasonable charges and expenses of its agents and
counsel) and the compensation for the services are intended to constitute
expenses of administration under any applicable Federal or state liquidation,
insolvency or other similar law.
The provisions of this Section shall survive the termination of this
Indenture or the resignation or removal of the Trustee.
SECTION 608. Disqualification; Conflicting Interests.
If the Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Trustee shall either eliminate such
interest or resign, to the extent and in the manner provided by, and subject to
the provisions of, the Trust Indenture Act and this Indenture.
SECTION 609. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which shall be a
Person that is eligible pursuant to the Trust Indenture Act to act as such and
has a combined capital and surplus of at least $50,000,000 and has its Corporate
Trust Office in New York, New York. If such Person publishes reports of
condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such Person shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. If at any time the Trustee shall cease to be eligible in accordance
with the provisions of this Section, it shall resign immediately in the manner
and with the effect hereinafter specified in this Article.
SECTION 610. Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 611.
(b) The Trustee may resign at any time by giving written notice
thereof to the Company. If an instrument of acceptance by a successor Trustee
shall not have been delivered to the Trustee within 30 days after the giving of
such notice of resignation, the resigning Trustee may petition any court of
competent jurisdiction for the appointment of a successor Trustee.
(c) The Trustee may be removed at any time by Act of the Holders of a
majority in principal amount of the Outstanding Securities, delivered to the
Trustee and to the
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Company. If an instrument of acceptance by a successor Trustee shall not have
been delivered to the Trustee within 30 days after the giving of such notice of
removal, the removed Trustee may petition any court of competent jurisdiction
for the appointment of a successor Trustee.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 608 after written
request therefor by the Company or by any Holder who has been a bona fide
Holder of a Security for at least six months, or
(2) the Trustee shall cease to be eligible under Section 609 and
shall fail to resign after written request therefor by the Company or by
any such Holder, or
(3) the Trustee shall become incapable of acting or shall be adjudged
a bankrupt or insolvent or a receiver of the Trustee or of its property
shall be appointed or any public officer shall take charge or control of
the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation, then, in any such case, (i)
the Company by a Board Resolution may remove the Trustee, or (ii) subject
to Section 514, any Holder who has been a bona fide Holder of a Security
for at least six months may, on behalf of himself and all others similarly
situated, petition any court of competent jurisdiction for the removal of
the Trustee and the appointment of a successor Trustee.
(e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause, the
Company, by a Board Resolution, shall promptly appoint a successor Trustee. If,
within one year after such resignation, removal or incapability, or the
occurrence of such vacancy, a successor Trustee shall be appointed by Act of the
Holders of a majority in principal amount of the Outstanding Securities
delivered to the Company and the Retiring Trustee, the successor Trustee so
appointed shall, forthwith upon its acceptance of such appointment, become the
successor Trustee and supersede the successor Trustee appointed by the Company.
If no successor Trustee shall have been so appointed by the Company or the
Holders and accepted appointment in the manner hereinafter provided, any Holder
who has been a bona fide Holder of a Security for at least six months may, on
behalf of himself and all others similarly situated, petition any court of
competent jurisdiction for the appointment of a successor Trustee.
(f) The Company shall give notice of each resignation and each
removal of the Trustee and each appointment of a successor Trustee to all
Holders in the manner provided in Section 106. Each notice shall include the
name of the successor Trustee and the address of its Corporate Trust Office.
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SECTION 611. Acceptance of Appointment by Successor.
Every successor Trustee appointed hereunder shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an instrument
accepting such appointment, and thereupon the resignation or removal of the
retiring Trustee shall become effective and such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee; provided that, on request of
the Company or the successor Trustee, such retiring Trustee shall, upon payment
of its charges, execute and deliver an instrument transferring to such successor
Trustee all the rights, powers and trusts of the retiring Trustee and shall duly
assign, transfer and deliver to such successor Trustee all property and money
held by such retiring Trustee hereunder. Upon acceptance of appointment by a
successor Trustee as provided in this Section 611, the Company shall mail notice
of the succession of such Trustee hereunder to the Holders of the Securities as
they appear on the Security Register. Upon request of any such successor
Trustee, the Company shall execute any and all instruments for more fully and
certainly vesting in and confirming to such successor Trustee all such rights,
powers and trusts.
No successor Trustee shall accept its appointment unless at the time
of such acceptance such successor Trustee shall be qualified and eligible under
this Article.
The Trustee shall not be liable for the acts or omissions of any
successor Trustee. The Trustee shall be paid all amounts owed to it upon its
resignation or removal.
SECTION 612. Merger, Conversion, Consolidation or Succession to Business.
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee, shall be the successor of the Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have been authenticated,
but not made available for delivery, by the Trustee then in office, any
successor by merger, conversion or consolidation to such authenticating Trustee
may adopt such authentication and make available for delivery the Securities so
authenticated with the same effect as if such successor Trustee had itself
authenticated such Securities.
SECTION 613. Preferential Collection of Claims Against Company.
If and when the Trustee shall be or becomes a creditor of the Company
(or any other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company (or any such other obligor).
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ARTICLE SEVEN
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 701. Company to Furnish Trustee Names and Addresses of Holders.
The Company will furnish or cause to be furnished to the Trustee (a)
quarterly, not later than March 31, June 30, September 30 and December 31 in
each year, a list, in such form as the Trustee may reasonably require, of the
names and addresses of the Holders to the extent the Company has knowledge
thereof as of a date not more than 15 days prior to the delivery thereof, and
(b) at such other times as the Trustee may request in writing, within 30 days
after the receipt by the Company of any such request, a list of similar form and
content as of a date not more than 15 days prior to the time such list is
furnished, excluding from any such list names and addresses received by the
Trustee in its capacity as Security Registrar.
SECTION 702. Preservation of Information; Communications to Holders.
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 701, and the names and
addresses of Holders received by the Trustee in its capacity as Security
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 701 upon receipt of a new list so furnished.
(b) The rights of Holders to communicate with other Holders with
respect to their rights under this Indenture or under the Securities, and the
corresponding rights and duties of the Trustee, shall be as provided by the
Trust Indenture Act.
(c) Every Holder of Securities, by receiving and holding the same,
agrees with the Company and the Trustee that neither the Company nor the Trustee
nor any officer, director, employee or agent of either of them shall be held
accountable by reason of any disclosure of information as to names and addresses
of Holders made pursuant to the Trust Indenture Act.
SECTION 703. Reports by Trustee.
(a) The Trustee shall transmit to Holders no later than 60 days after
May 15 of each year commencing in 1998 such reports concerning the Trustee and
its actions under this Indenture as may be required pursuant to the Trust
Indenture Act at the times and in the manner provided pursuant thereto.
(b) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each stock exchange upon
which the Securities are listed, with the Commission and with the Company. The
Company will notify the Trustee, in writing, when the Securities are listed on
any stock exchange.
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SECTION 704. Reports by Company.
The Company shall file with the Trustee and the Commission, and
transmit to Holders, such information, documents and other reports, and such
summaries thereof, as may be required pursuant to the Trust Indenture Act at the
times and in the manner provided pursuant to such Act; provided that any such
information, documents or reports required to be filed with the Commission
pursuant to Section 13(a) or 15(d) of the Securities and Exchange Act of 1934
shall be filed with the Trustee within 15 days after the same is so required to
be filed with the Commission. Delivery of such reports, information and
documents to the Trustee is for informational purposes only and the Trustee's
receipt of such shall not constitute constructive notice of any information
contained therein or determinable from information contained therein, including
the Company's compliance with any of its covenants hereunder (as to which the
Trustee is entitled to rely exclusively on Officers' Certificates).
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company May Consolidate, Etc., Only on Certain Terms.
The Company shall not consolidate with or merge into any other Person
or convey, transfer or lease its properties and assets substantially as an
entirety to any Person, unless:
(1) the Person formed by such consolidation or into which the Company
is merged or the Person that acquires by conveyance or transfer, or which
leases, the properties and assets of the Company substantially as an
entirety shall be a corporation, partnership or trust, shall be organized
and existing under the laws of the United States of America or any State or
the District of Columbia, and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee, the due and punctual payment of the principal
of (and premium, if any) and interest (including any Additional Interest)
on all the Securities and the performance of every covenant of this
Indenture on the part of the Company to be performed or observed;
(2) immediately after giving effect to such transaction, no Event of
Default, and no event which, after notice or lapse of time, or both, would
become an Event of Default, shall have happened and be continuing;
(3) for so long as Securities registered on the Securities Register
in the name of the Trust (or the Property Trustee) are outstanding, such
consolidation, merger, conveyance, transfer or lease is permitted under the
Declaration and the Guarantee and does not give rise to any breach or
violation of the Declaration or the Guarantee;
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(4) any such lease shall provide that it will remain in effect so
long as any Securities are Outstanding; and
(5) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel each stating that such consolidation, merger,
conveyance, transfer or lease and any such supplemental indenture complies
with this Article and that all conditions precedent herein provided for
relating to such transaction have been complied with; and the Trustee,
subject to Section 601, may rely upon such Officers' Certificate and
Opinion of Counsel as conclusive evidence that such transaction complies
with this Section 801.
SECTION 802. Successor Person Substituted.
Upon any consolidation or merger by the Company with or into any
other Person, or any conveyance, transfer or lease by the Company of its
properties and assets substantially as an entirety to any Person in accordance
with Section 801, the successor Person formed by such consolidation or into
which the Company is merged or to which such conveyance, transfer or lease is
made shall succeed to, and be substituted for, and may exercise every right and
power of, the Company under this Indenture with the same effect as if such
successor Person had been named as the Company herein; and, in the event of any
such conveyance, transfer or lease the Company shall be discharged from all
obligations and covenants under the Indenture and the Securities and may be
dissolved and liquidated.
Such successor Person may cause to be signed, and may issue either in
its own name or in the name of the Company, any or all of the Securities
issuable hereunder which theretofore shall not have been signed by the Company
and delivered to the Trustee; and, upon the order of such successor Person
instead of the Company and subject to all the terms, conditions and limitations
in this Indenture prescribed, the Trustee shall authenticate, upon receipt of a
Company Order for the authentication, and shall make available for delivery any
Securities which previously shall have been signed and delivered by the officers
of the Company to the Trustee for authentication pursuant to such provisions and
any Securities which such successor Person thereafter shall cause to be signed
and delivered to the Trustee on its behalf for the purpose pursuant to such
provisions. All the Securities so issued shall in all respects have the same
legal rank and benefit under this Indenture as the Securities theretofore or
thereafter issued in accordance with the terms of this Indenture as though all
of such Securities had been issued at the date of the execution hereof.
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ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Company, when authorized by a
Board Resolution, and the Trustee, at any time and from time to time, may enter
into one or more indentures supplemental hereto, in form satisfactory to the
Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the Company and
the assumption by any such successor of the covenants of the Company herein
and in the Securities; or
(2) to add to the covenants of the Company for the benefit of the
Holders, or to surrender any right or power herein conferred upon the
Company; or
(3) to cure any ambiguity or defect, to correct or supplement any
provision herein which may be inconsistent with any other provision herein,
or to make any other provisions with respect to matters or questions
arising under this Indenture which shall not be inconsistent with the
provisions of this Indenture, provided that such action pursuant to this
clause (3) shall not adversely affect the interests of the Holders of the
Securities or, so long as any of the Capital Securities shall remain
outstanding, the holders of the Capital Securities;
(4) to comply with any requirement of the Commission in order to
effect or maintain the qualification of this Indenture under the Trust
Indenture Act; or
(5) to add to, delete from or revise the terms of the Securities to
provide for transfer procedures and restrictions substantially similar to
those applicable to the Capital Securities (for purposes of assuring that
no registration of the Securities is required under the Securities Act).
SECTION 902. Supplemental Indentures With Consent of Holders.
With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities, by Act of said Holders delivered
to the Company and the Trustee, the Company, when authorized by a Board
Resolution, and the Trustee may enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or of
modifying in any manner the rights of the Holders under this Indenture;
provided, however, that no such supplemental indenture shall, without the
consent of the Holder of each Outstanding Security affected thereby,
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(1) change the Stated Maturity of, the principal of, or any
installment of interest on, any Security, or reduce the principal amount thereof
or the rate of interest thereon or extend the time of payment of interest
thereon (except such extension as is contemplated hereby), or change the place
of payment where, or the coin or currency in which, any Security or interest
thereon is payable, or impair the right to institute suit for the enforcement of
any such payment on or after the Stated Maturity thereof (or, in the case of
redemption, on or after the Redemption Date), or modify the provisions of this
Indenture with respect to the subordination of the Securities in a manner
adverse to the Holders,
(2) reduce the percentage in principal amount of the Outstanding
Securities, the consent of whose Holders is required for any such supplemental
indenture, or the consent of whose Holders is required for any waiver (of
compliance with certain provisions of this Indenture or certain defaults
hereunder and their consequences) provided for in this Indenture, or
(3) modify any of the provisions of this Section, Section 513 or
Section 1008, except to increase any such percentage or to provide that certain
other provisions of this Indenture cannot be modified or waived without the
consent of the Holder of each Outstanding Security affected thereby; provided,
that, so long as any of the Capital Securities remains outstanding, no such
amendment shall be made that adversely affects the holders of the Capital
Securities in any material respect, and no termination of this Indenture shall
occur, and no waiver of any Event of Default or compliance with any covenant
under this Indenture shall be effective, without the prior consent of the
holders of at least a majority of the aggregate liquidation preference of the
outstanding Capital Securities unless and until the principal of and any premium
on the Securities and all accrued and unpaid interest thereon have been paid in
full.
It shall not be necessary for any Act of Holders under this Section
to approve the particular form of any proposed supplemental indenture, but it
shall be sufficient if such Act shall approve the substance thereof.
SECTION 903. Execution of Supplemental Indentures.
In executing, or accepting the additional trust created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 601) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Trustee may, but shall not be
obligated to, enter into such supplemental indenture which affects the Trustee's
own rights, duties or immunities under this Indenture or otherwise.
SECTION 904. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall
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form a part of this Indenture for all purposes; and every Holder of Securities
theretofore or thereafter authenticated and delivered hereunder shall be bound
thereby.
SECTION 905. Conformity With Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act.
SECTION 906. Reference in Securities to Supplemental Indentures.
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article may, and shall if required by
the Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company shall so determine,
new Securities so modified as to conform, in the opinion of the Trustee and the
Company, to any such supplemental indenture may be prepared and executed by the
Company and authenticated, upon receipt of a Company Order for the
authentication, and made available for delivery by the Trustee in exchange for
Outstanding Securities.
ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal and Interest.
The Company will duly and punctually pay the principal of and
interest on the Securities in accordance with the terms of the Securities and
this Indenture and comply with all other terms and conditions and agreements
contained herein.
SECTION 1002. Maintenance of Office or Agency.
The Company will maintain in the City of New York an office or agency
where Securities may be presented or surrendered for registration of transfer or
exchange, where Securities may be surrendered for conversion and where notices
and demands to or upon the Company in respect of the Securities and this
Indenture may be served. The Company will give prompt written notice to the
Trustee of the location, and any change in location, of such office or agency.
If at any time the Company shall fail to maintain any such required office or
agency or shall fail to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee, and the Company hereby appoints the
Trustee as its agent to receive all such presentations, surrenders, notices and
demands.
The Company may also from time to time designate one or more other
offices or agencies in the United States where the Securities may be presented
or surrendered for any
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or all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
United States for such purposes. The Company will give prompt written notice to
the Trustee of any such designation or rescission and of any change in the
location of any such other office or agency.
SECTION 1003. Money for Security Payments to be Held in Trust.
If the Company shall at any time act as its own Paying Agent, subject
to any requirements of the Luxembourg Stock Exchange, if the Securities are
listed on such exchange, it will, on, or at the option of the Company, before
each due date of the principal of or interest on any of the Securities,
segregate and hold in trust for the benefit of the Persons entitled thereto a
sum sufficient to pay the principal or interest so becoming due until such sums
shall be paid to such Persons or otherwise disposed of as herein provided and
will promptly notify the Trustee, in writing, of its action or failure so to
act. In such case the Company shall not invest the amount so segregated and held
in trust pending the distribution thereof.
Whenever the Company shall have one or more Paying Agents, it will,
on or prior to each due date of the principal of or interest on any Securities,
deposit with a Paying Agent a sum sufficient to pay such amount, such sum to be
held as provided by the Trust Indenture Act, and (unless such Paying Agent is
the Trustee) the Company will promptly notify the Trustee, in writing, of its
action or failure so to act; provided, however, that any such deposit on a due
date shall be initiated no later than 12:00 noon (New York time) on a Business
Day prior to the due date in same-day funds.
The Company will cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section, that
such Paying Agent will (i) comply with the provisions of the Trust Indenture Act
applicable to it as a Paying Agent and (ii) during the continuance of any
default by the Company (or any other obligor upon the Securities) in the making
of any payment in respect of the Securities, upon the written request of the
Trustee, forthwith pay to the Trustee all sums held in trust by such Paying
Agent as such.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
the trust by the Company or such Paying Agent, such sums to be held by the
Trustee upon the same trusts as those upon which such sums were held by the
Company or such Paying Agent; and, upon such payment by any Paying Agent to the
Trustee, such Paying Agent shall be released from all further liability with
respect to such money.
Any money deposited with the Trustee or any Paying Agent, or then
held by the Company, in trust for the payment of the principal or interest that
has become due and payable shall be paid to the Company on Company Request, or
(if then held by the Company) shall be
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discharged from such trust, if such principal or interest has not been claimed
by the Holder of the Security upon which such payments are due with in one year
of the date such principal and interest became due and payable; and the Holder
of such Security shall thereafter, as an unsecured general creditor, look only
to the Company for payment thereof, and all liability of the Trustee and its
officers, directors, employees, and agents or such Paying Agent and its
officers, directors, employees, and agents with respect to such trust money, and
all liability of the Company as trustee thereof, shall thereupon cease.
SECTION 1004. Statements by Officers as to Default.
The Company will deliver to the Trustee, within 120 days after the
end of each fiscal year of the Company ending after the date hereof, an
Officers' Certificate, stating whether or not to the best knowledge of the
signers thereof the Company is in default in the performance and observance of
any of the material terms, provisions and conditions of this Indenture (without
regard to any period of grace or requirement of notice provided hereunder) and,
if the Company shall be in default, specifying all such defaults and the nature
and status thereof of which they may have knowledge.
SECTION 1005. Existence.
Subject to Article Eight, the Company will do or cause to be done all
things necessary to preserve and keep in full force and effect its existence,
rights (charter and statutory) and franchises; provided, however, that the
Company shall not be required to preserve any such right or franchise if the
Board of Directors shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company and that the loss
thereof is not disadvantageous in any material respect to the Holders and, while
any Capital Securities are outstanding, the holders of the Capital Securities.
SECTION 1006. Maintenance of Properties.
The Company will cause all properties used or useful in the conduct
of its business or the business of any Subsidiary to be maintained and kept in
good condition, repair and working order and supplied with all necessary
equipment and will cause to be made all necessary repairs, renewals,
replacements, betterment and improvements thereof, all as in the judgment of the
Company may be necessary so that the business carried on in connection therewith
may be properly and advantageously conducted at all times; provided, however,
that nothing in this Section shall prevent the Company from discontinuing the
operation or maintenance of any such properties if such discontinuance is, in
the judgment of the Company, desirable in the conduct of its business or the
business of any Subsidiary and not disadvantageous in any material respect to
the Holders.
SECTION 1007. Payment of Taxes and Other Claims.
The Company will pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (1) all taxes, assessments and
governmental charges levied
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or imposed upon the Company or any Subsidiary or upon the income, profits or
property of the Company or any Subsidiary, and (2) all lawful claims for labor,
materials and supplies which, if unpaid, might by law become a lien upon the
property of the Company or any Subsidiary that comprise more than 10% of the
assets of the Company and its Subsidiaries, taken as a whole; provided, however,
that the Company shall not be required to pay or discharge or cause to be paid
or discharged any such tax, assessment, charge or claim whose amount,
applicability or validity is being contested in good faith by appropriate
proceedings.
SECTION 1008. Waiver of Certain Covenants.
Except as otherwise specified or as contemplated by Section 301 for
Securities, the Company may, with respect to the Securities, omit in any
particular instance to comply with any term, provision or condition set forth in
any covenant provided pursuant to Section 901(2) for the benefit of the Holders
if before the time for such compliance the Holders of at least a majority in
principal amount of the Outstanding Securities shall, by Act of such Holders,
either waive such compliance in such instance or generally waive compliance with
such term, provision or condition, but no waiver shall extend to or affect such
term, provision or condition except to the extent so expressly waived, and,
until such waiver shall become effective, the obligations of the Company and the
duties of the Trustee in respect of any such term, provision or condition shall
remain in full force and effect.
SECTION 1009. Payment of the Trust's Costs and Expenses.
Since the Trust is being formed solely to facilitate an investment in
the Securities, the Company, as borrower, hereby covenants to pay all debts and
obligations (other than with respect to the Capital Securities and Common
Securities) and all costs and expenses of the Trust (including, but not limited
to, all costs and expenses relating to the organization of the Trust, the fees
and expenses of the Trustees and their agents and counsel and all costs and
expenses relating to the operation of the Trust) and to pay any and all taxes,
duties, assessments or governmental charges of whatever nature (other than
withholding taxes) imposed on the Trust by the United States, or any other
taxing authority, so that the net amounts received and retained by the Trust and
the Property Trustee after paying such expenses will be equal to the amounts the
Trust and the Property Trustee would have received had no such costs or expenses
been incurred by or imposed on the Trust, provided that the Trust is the holder
of the Junior Subordinated Debentures. The foregoing obligations of the Company
are for the benefit of, and shall be enforceable by, any person to whom any such
debts, obligations, costs, expenses and taxes are owed (each, a "Creditor")
whether or not such Creditor has received notice thereof. Any such Creditor may
enforce such obligations of the Company directly against the Company, and the
Company irrevocably waives any right or remedy to require that any such Creditor
take any action against the Trust or any other person before proceeding against
the Company. The Company shall execute such additional agreements as may be
necessary or desirable to give full effect to the foregoing.
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SECTION 1010. Restrictions on Payments and Distributions.
The Company will not, and will not permit any Subsidiary to, (i)
declare or pay any dividends or distributions on, or redeem, purchase, acquire,
or make a liquidation payment with respect to, any of the Company's capital
stock or (ii) make any payment of principal, interest or premium, if any, on or
repay or repurchase or redeem any debt securities of the Company that rank pari
passu with or junior in interest to the Securities or make any guarantee
payments with respect to any guarantee by the Company of the debt securities of
any Subsidiary if such guarantee ranks pari passu with or junior in interest to
the Securities (other than (a) repurchases, redemptions or other acquisitions of
shares of capital stock of the Company in connection with any employment
contract, benefit plan or other similar arrangement with or for the benefit of
any one or more employees, officers, directors or consultants or in connection
with a dividend reinvestment or stockholder stock purchase plan, (b) as a result
of an exchange or conversion of any class or series of the Company's capital
stock (or any capital stock of a subsidiary of the Company) for any class or
series of the Company's capital stock or of any class or series of the Company's
indebtedness for any class or series of the Company's capital stock, (c) the
purchase of fractional interests in shares of the Company's capital stock
pursuant to the conversion or exchange provisions of such capital stock or the
security being converted or exchanged, (d) any declaration of a dividend in
connection with any stockholder's rights plan, or the issuance of rights, stock
or other property under any stockholder's rights plan, or the redemption or
repurchase of rights pursuant thereto, or (e) any dividend in the form of stock,
warrants, options or other rights where the dividend stock or stock issuable
upon exercise of such warrants, options, or other rights is the same stock as
that on which the dividend is being paid or ranks pari passu with or junior to
such stock) if at such time (x) there shall have occurred any event of which the
Company has actual knowledge that (I) with the giving of notice or the lapse of
time, or both, would constitute an Event of Default and (II) in respect of which
the Company shall not have taken reasonable steps to cure, (y) the Company shall
be in default with respect to its payment of any obligations under the Guarantee
or (z) the Company shall have given notice of its election of an Extension
Period as provided herein and shall not have rescinded such notice, or such
Extension Period, or any extension thereof, shall be continuing.
ARTICLE ELEVEN
SUBORDINATION OF SECURITIES
SECTION 1101. Securities Subordinate to Indebtedness.
The Company covenants and agrees, and each Holder of a Security, by
his acceptance thereof, likewise covenants and agrees, that, to the extent and
in the manner hereinafter set forth in this Article (subject to Article Four),
the payment of the principal of and interest on each and all of the Securities
are hereby expressly made subordinate and subject in right of payment to the
prior payment in full in cash of all Indebtedness.
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The provisions of this Article Eleven are made for the benefit of the
holders of Indebtedness and such holders are made obligees hereunder and any one
or more of them may enforce such provisions. Holders of Indebtedness need not
prove reliance on the subordination provisions hereof.
SECTION 1102. Default on Indebtedness.
In the event and during the continuation of any default in the
payment of principal, premium, interest or any other payment due on any
Indebtedness, or in the event that any event of default with respect to any
Indebtedness shall have occurred and be continuing and shall have resulted in
such Indebtedness becoming or being declared due and payable prior to the date
on which it would otherwise have become due and payable (unless and until such
event of default shall have been cured or waived or shall have ceased to exist
and such acceleration shall have been rescinded or annulled) or in the event any
judicial proceeding shall be pending with respect to any such default in payment
or such event of default, then no payment shall be made by the Company with
respect to the principal (including redemption payments) of, or interest on, the
Securities.
In the event that, notwithstanding the foregoing, any payment shall
be received by the Trustee or any Holder when such payment is prohibited by the
preceding paragraph of this Section 1102, such payment shall be held in trust
for the benefit of, and shall be paid over or delivered to, the holders of
Indebtedness or their respective representatives, or to the trustee or trustees
under any indenture pursuant to which any of such Indebtedness may have been
issued, as their respective interests may appear, but only to the extent that
the holders of the Indebtedness (or their representative or representatives or a
trustee) notify the Trustee, in writing, within 90 days of such payment of the
amounts then due and owing on the Indebtedness and only the amounts specified in
such notice to the Trustee shall be paid to the holders of Indebtedness.
SECTION 1103. Prior Payment of Indebtedness Upon Acceleration of Securities.
In the event that the Securities are declared due and payable before
their Stated Maturity, then and in such event the holders of the Indebtedness
outstanding at the time such Securities so become due and payable shall be
entitled to receive payment in full of all amounts then due on or in respect of
such Indebtedness (including any amounts due upon acceleration), or provision
shall be made for such payment in cash or cash equivalents or otherwise in a
manner satisfactory to the holders of Indebtedness, before the Holders of the
Securities are entitled to receive any payment or distribution of any kind or
character, whether in cash, properties or securities, by the Company on account
of the principal of or interest on the Securities or on account of the purchase
or other acquisition of Securities by the Company or any Subsidiary; provided,
however, that holders of Indebtedness shall not be entitled to receive payment
of any such amounts to the extent that such holders would be required by the
subordination provisions of such Indebtedness to pay such amounts over to the
obligees on trade accounts payable or other liabilities arising in the ordinary
course of the Company's business.
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In the event that, notwithstanding the foregoing, any payment shall
be received by the Trustee or any Holder when such payment is prohibited by the
preceding paragraph of this Section 1103, such payment shall be held in trust
for the benefit of, and shall be paid over or delivered to, the holders of
Indebtedness or their respective representatives, or to the trustee or trustees
under any indenture pursuant to which any of such Indebtedness may have been
issued, as their respective interests may appear, but only to the extent that
the holders of the Indebtedness (or their representative or representatives or a
trustee) notify the Trustee, in writing, within 90 days of such payment of the
amounts then due and owing on the Indebtedness and only the amounts specified in
such notice to the Trustee shall be paid to the holders of Indebtedness.
SECTION 1104. Liquidation; Dissolution.
Upon any payment by the Company, or distribution of assets of the
Company of any kind or character, whether in cash, property or securities, to
creditors upon any dissolution or winding-up or liquidation or reorganization of
the Company, whether voluntary or involuntary or in insolvency, receivership or
other proceedings, all principal of, and premium, if any, and interest due or to
become due upon all Indebtedness (including interest after the commencement of
any insolvency, receivership or other proceedings at the rate specified in the
applicable Indebtedness, whether or not such interest is an allowable claim in
any such proceeding) shall first be paid in full, or payment thereof provided
for in money in accordance with its terms, before any payment is made on account
of the principal or interest on the Securities; and upon any such dissolution or
winding-up or liquidation or reorganization any payment by the Company, or
distribution of substantially all of the assets of the Company of any kind or
character, whether in cash, property or securities, to which the Holders of the
Securities or the Trustee would be entitled, except for the provisions of this
Article Eleven, shall be paid by the Company or by any receiver, liquidating
trustee, agent or other Person making such payment or distribution, or by the
Holders of the Securities or by the Trustee under this Indenture if received by
them or it, directly to the holders of Indebtedness (pro rata to such holders on
the basis of the respective amounts of Indebtedness held by such holders, as
calculated by the Company) or their representative or representatives, or to the
trustee or trustees under any indenture pursuant to which any instruments
evidencing any Indebtedness may have been issued, as their respective interests
may appear, to the extent necessary to pay all Indebtedness in full (including
interest after the commencement of any insolvency, receivership or other
proceedings at the rate specified in the applicable Indebtedness, whether or not
such interest is in an allowable claim in any such proceeding) or to provide for
such payment in money in accordance with its terms, after giving effect to any
concurrent payment or distribution to or for the holders of Indebtedness, before
any payment or distribution is made to the Holders of Securities or to the
Trustee or the Property Trustee on behalf of the Holders of Capital Securities;
provided, however, that such holders of Indebtedness shall not be entitled to
receive payment of any such amounts to the extent that such holders would be
required by the subordination provisions of such Indebtedness to pay such
amounts over to the obligees on trade accounts payable or other liabilities
arising in the ordinary course of the Company's business.
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In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, prohibited by the foregoing, shall be received by the
Trustee or the Holders of the Securities before all Indebtedness is paid in full
(including interest after commencement of any insolvency, receivership or other
proceedings at the rate specified in the applicable Indebtedness, whether or not
such interest is an allowable claim in any such proceeding), or provision is
made for such payment in money in accordance with its terms, such payment or
distribution shall be held in trust for the benefit of and shall be paid over or
delivered to the holders of Indebtedness or their representative or
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing any Indebtedness may have been issued, as their
respective interests may appear, as calculated by the Company, for application
to the payment of all Indebtedness remaining unpaid to the extent necessary to
pay all Indebtedness in full in money in accordance with its terms, after giving
effect to any concurrent payment or distribution to or for the holders of such
Indebtedness.
Any holder of Indebtedness may file any proof of claim or similar
instrument on behalf of the Trustee and the Holders if such instrument has not
been filed by the date which is 30 days prior to the date specified for filing
thereof.
For purposes of this Article Eleven, the words "cash, property or
securities" shall not be deemed to include shares of stock of the Company as
reorganized or readjusted, or securities of the Company or any other corporation
provided for by a plan of reorganization or readjustment, the payment of which
is subordinated at least to the extent provided in this Article Eleven with
respect to the Securities to the payment of all Indebtedness that may at the
time be outstanding, provided, however, that (i) the Indebtedness is assumed by
the new corporation, if any, resulting from any such reorganization or
readjustment, and (ii) the rights of the holders of the Indebtedness are not,
without the consent of such holders, altered by such reorganization or
readjustment. The consolidation of the Company with, or merger of the Company
into, another corporation or the liquidation or dissolution of the Company
following the conveyance or transfer of its property as an entirety, or
substantially as an entirety, to another corporation upon the terms and
conditions provided for in Article Eight hereof shall not be deemed a
dissolution, winding-up, liquidation or reorganization for the purposes of this
Section 1104 if such other corporation shall, as a part of such consolidation,
merger, conveyance or transfer, comply with the conditions stated in Article
Eight hereof. Nothing in Section 1103 or in this Section 1104 shall apply to
claims of, or payments to, the Trustee under or pursuant to Section 607.
SECTION 1105. Subrogation.
Subject to the payment in full of all Indebtedness to the extent
provided in Sections 1103 and 1104, the rights of the Holders of the Securities
shall be subrogated to the rights of the holders of Indebtedness to receive
payments or distributions of cash, property or securities of the Company
applicable to the Indebtedness until the principal of (and premium, if any) and
interest on the Securities shall be paid in full; and, for the purposes of such
subrogation, no payments or distributions to the holders of the Indebtedness of
any cash,
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property or securities to which the Holders of the Securities or the Trustee
would be entitled except for the provisions of this Article Eleven, shall, as
between the Company, its creditors other than holders of Indebtedness, and the
Holders of the Securities, be deemed to be a payment by the Company to or on
account of the Indebtedness. It is understood that the provisions of this
Article Eleven are and are intended solely for the purposes of defining the
relative rights of the Holders of the Securities, on the one hand, and the
holders of the Indebtedness on the other hand.
Nothing contained in this Article Eleven or elsewhere in this
Indenture or in the Securities is intended to or shall impair, as between the
Company, its creditors other than the holders of Indebtedness, and the Holders
of the Securities, the obligation of the Company, which is absolute and
unconditional, to pay to the Holders of the Securities the principal of (and
premium, if any) and interest on the Securities as and when the same shall
become due and payable in accordance with their terms, or is intended to or
shall affect the relative rights of the Holders of the Securities and creditors
of the Company other than the holders of the Indebtedness, nor shall anything
herein or therein prevent the Trustee or the Holder of any Security from
exercising all remedies otherwise permitted by applicable law upon default under
this Indenture, subject to the rights, if any, under this Article Eleven of the
holders of Indebtedness in respect of cash, property or securities of the
Company received upon the exercise of any such remedy.
Upon any payment or distribution of assets of the Company referred to
in this Article Eleven, the Trustee, subject to the provisions of Section 601,
and the Holders of the Securities, shall be entitled to rely conclusively upon
any order or decree made by any court of competent jurisdiction in which such
dissolution, winding-up, liquidation or reorganization proceedings are pending,
or a certificate of the receiver, liquidation trustee, agent or other Person
making such payment or distribution, delivered to the Trustee or to the Holders
of the Securities, for the purposes of ascertaining the Persons entitled to
participate in such distribution, the holders of the Indebtedness and other
indebtedness of the Company, the amount thereof or payable thereon, the amount
or amounts paid or distributed thereon and all other facts pertinent thereto or
to this Article Eleven.
SECTION 1106. Trustee to Effectuate Subordination.
Each Holder of a Security by acceptance thereof authorizes and
directs the Trustee on such Holder's behalf to take such action as may be
necessary or appropriate in the sole and absolute discretion of the Trustee to
effectuate the subordination provided in this Article Eleven and appoints the
Trustee such Holder's attorney-in-fact for any and all such purposes.
SECTION 1107. Notice by the Company.
The Company shall give prompt written notice to a Responsible Officer
of the Trustee of any fact known to the Company that would prohibit the making
of any payment of monies to or by the Trustee in respect of the Securities
pursuant to the provisions of this
<PAGE> 71
62
Article Eleven. Notwithstanding the provisions of this Article Eleven or any
other provision of this Indenture, the Trustee shall not be charged with
knowledge of the existence of any facts that would prohibit the making of any
payment of monies to or by the Trustee in respect of the Securities pursuant to
the provisions of this Article Eleven, unless and until a Responsible Officer of
the Trustee shall have received written notice thereof at the Corporate Trust
Office of the Trustee from the Company or a holder or holders of Indebtedness or
from any trustee therefor; and before the receipt of any such written notice,
the Trustee, subject to the provisions of Section 601, shall be entitled in all
respects to assume that no such facts exist; provided, however, that if the
Trustee shall not have received the notice provided for in this Section 1107 at
least three Business Days prior to the date upon which by the terms hereof any
money may become payable for any purpose (including, without limitation, the
payment of the principal of (or premium, if any) or interest on any Security),
then, anything herein contained to the contrary notwithstanding, the Trustee
shall have full power and authority to receive such money and to apply the same
to the purposes for which they were received, and shall not be affected by any
notice to the contrary that may be received by it within three Business Days
prior to such date.
The Trustee, subject to the provisions of Section 601, shall be
entitled to rely conclusively on the delivery to it of a written notice by a
Person representing himself to be a holder of Indebtedness (or a trustee on
behalf of such holder) to establish that such notice has been given by a holder
of Indebtedness or a trustee on behalf of any such holder or holders. In the
event that the Trustee determines in good faith that further evidence is
required with respect to the right of any Person as a holder of Indebtedness to
participate in any payment or distribution pursuant to this Article Eleven, the
Trustee may request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of Indebtedness held by such
Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under this Article Eleven, and if such evidence is not furnished the
Trustee may defer any payment to such Person pending judicial determination as
to the right of such Person to receive such payment.
SECTION 1108. Rights of the Trustee; Holders of Indebtedness.
The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article Eleven in respect of any Indebtedness at any
time held by it, to the same extent as any other holder of Indebtedness, and
nothing in this Indenture shall deprive the Trustee of any of its rights as such
holder.
With respect to the holders of Indebtedness, the Trustee undertakes
to perform or to observe only such of its covenants and obligations as are
specifically set forth in this Article Eleven, and no implied covenants or
obligations with respect to the holders of Indebtedness shall be read into this
Indenture against the Trustee. The Trustee shall not be deemed to owe any
fiduciary duty to the holders of Indebtedness and, subject to the provisions of
Section 601, the Trustee shall not be liable to any holder of Indebtedness if it
shall pay over or deliver to holders of Securities, the Company or any other
Person money or assets to which any holder of Indebtedness shall be entitled by
virtue of this Article Eleven or otherwise.
<PAGE> 72
63
SECTION 1109. Subordination May Not Be Impaired.
No right of any present or future holder of any Indebtedness to
enforce subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the Company
or by any act or failure to act, in good faith, by any such holder, or by any
noncompliance by the Company with the terms, provisions and covenants of this
Indenture, regardless of any knowledge thereof that any such holder may have or
otherwise be charged with.
Without in any way limiting the generality of the foregoing
paragraph, the holders of Indebtedness may, at any time and from time to time,
without the consent of or notice to the Trustee or the Holders of the
Securities, without incurring responsibility to the Holders of the Securities
and without impairing or releasing the subordination provided in this Article or
the obligations hereunder of the Holders of the Securities to the holders of
Indebtedness, do any one or more of the following: (i) change the manner, place
or terms of payment or extend the time of payment of, or renew or alter,
Indebtedness or otherwise amend or supplement in any manner Indebtedness or any
instrument evidencing the same or any agreement under which Indebtedness is
outstanding; (ii) sell, exchange, release or otherwise deal with any property
pledged, mortgaged or otherwise securing Indebtedness; (iii) release any Person
liable in any manner for the collection of Indebtedness; and (iv) exercise or
refrain from exercising any rights against the Company and any other Person.
ARTICLE TWELVE
REDEMPTION OF SECURITIES
SECTION 1201. Optional Redemption; Conditions to Optional Redemption.
At any time on or after February 1, 2007, the Company shall have the
right to redeem the Securities, in whole or in part, from time to time, at a
Redemption Price equal to 100% of the principal amount of Securities to be
redeemed plus any accrued but unpaid interest (including any Additional
Interest) to the Redemption Date.
If a Special Event shall occur and be continuing, the Company shall
have the right, subject to the last paragraph of this Section 1201, to redeem,
upon not less than 30 days nor more than 60 days notice, the Securities in
whole, but not in part, at a Redemption Price equal to 100% of the principal
amount of Securities then outstanding plus accrued but unpaid interest
(including any Additional Interest) to the Redemption Date.
For so long as the Trust is the Holder of all Securities Outstanding,
the proceeds of any redemption described in this Section 1201 shall be used by
the Trust to redeem Common Securities and Capital Securities in accordance with
their terms. The Company shall not redeem the Securities in part unless all
accrued and unpaid interest
<PAGE> 73
64
(including any Additional Interest) has been paid in full on all Securities
outstanding for all quarterly interest periods terminating on or prior to the
Redemption Date.
SECTION 1202. Applicability of Article.
Redemption of Securities at the election of the Company, as permitted
by Section 1201, shall be made in accordance with such provision and this
Article.
SECTION 1203. Election to Redeem; Notice to Trustee.
The election of the Company to redeem Securities pursuant to Section
1201 shall be evidenced by a Board Resolution. In case of any redemption at the
election of the Company, the Company shall, at least 45 days and no more than 60
days prior to the Redemption Date fixed by the Company, notify the Trustee, in
writing, of such Redemption Date and of the principal amount of Securities to be
redeemed and provide a copy of the notice of redemption given to Holders of
Securities to be redeemed pursuant to Section 1205.
SECTION 1204. Selection by Trustee of Securities to be Redeemed.
If less than all the Securities are to be redeemed (unless such
redemption affects only a single Security), the particular Securities to be
redeemed shall be selected by lot (or such other method of selection as the
Trustee may customarily employ) not more than 60 days prior to the Redemption
Date by the Trustee, from the Outstanding Securities not previously called for
redemption.
The Trustee shall promptly notify the Company in writing of the
Securities selected for redemption as aforesaid and, in case of any Securities
selected for partial redemption as aforesaid, the principal amount thereof to be
redeemed.
The provisions of the two preceding paragraphs shall not apply with
respect to any redemption affecting only a single Security, whether such
Security is to be redeemed in whole or in part. In the case of any such
redemption in part, the unredeemed portion of the principal amount of the
Security shall be in an authorized denomination (which shall not be less than
the minimum authorized denomination) for such Security.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall relate,
in the case of any Securities redeemed or to be redeemed only in part, to the
portion of the principal amount of such Securities which has been or is to be
redeemed.
SECTION 1205. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage
prepaid, mailed not less than 30 (provided that the Trustee shall itself have
received notice not less than 45
<PAGE> 74
65
days prior to the Redemption Date) nor more than 60 days prior to the Redemption
Date, to each Holder of Securities to be redeemed, at his address appearing in
the Security Register.
All notices of redemption shall identify the Securities to be
redeemed (including CUSIP number) and shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) that on the Redemption Date the Redemption Price will become due
and payable upon each such Security to be redeemed and that interest
thereon will cease to accrue on and after said date, and
(4) the place or places where such Securities are to be surrendered
for payment of the Redemption Price.
Notice of redemption of Securities to be redeemed at the election of
the Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company.
SECTION 1206. Deposit of Redemption Price.
On or prior to any Redemption Date, the Company shall deposit with
the Trustee or with a Paying Agent (or, if the Company is acting as its own
Paying Agent, segregate and hold in trust as provided in Section 1003) an amount
of money sufficient to pay the Redemption Price of, and (except if the
Redemption Date shall be an Interest Payment Date) accrued interest (including
any Additional Interest) on, all the Securities which are to be redeemed on that
date; provided, however, that any such deposit on a Redemption Date shall be
initiated no later than 11:00 a.m. (New York time) in same-day funds; provided,
however, that such amounts of money sufficient to pay the Redemption Price must
be received one day prior to the Redemption Date for the definitive Securities
on the Luxembourg Stock Exchange.
SECTION 1207. Securities Payable on Redemption Date.
Notice of redemption having been given as aforesaid, the Securities
so to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified, and from and after such date (unless the
Company shall default in the payment of the Redemption Price and accrued
interest (including any Additional Interest)) such Securities shall cease to
bear interest. Upon surrender of any such Security for redemption in accordance
with said notice, such Security shall be paid by the Company at the Redemption
Price, together with accrued interest to the Redemption Date; provided, however,
that installments of interest whose Stated Maturity is on or prior to the
Redemption Date shall be payable to the Holders of such Securities, or one or
more Predecessor Securities, registered as
<PAGE> 75
66
such at the close of business on the relevant Record Dates according to their
terms and the provisions of Section 307.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal shall, until paid, bear interest
from the Redemption Date at the rate borne by the Security.
SECTION 1208. Securities Redeemed in Part.
Any Security which is to be redeemed only in part shall be
surrendered at a place of payment therefor (with, if the Company or the Trustee
so requires, due endorsement by, or a written instrument of transfer in form
satisfactory to the Company and the Trustee duly executed by, the Holder
therefor or his attorney duly authorized in writing), and the Company shall
execute, and the Trustee shall authenticate, upon receipt of a Company Order for
the authentication, and deliver to the Holder of such Security without service
charge, a new Security or Securities, of any authorized denomination as
requested by such Holder, in aggregate principal amount equal to and in exchange
for the unredeemed portion of the principal of the Security so surrendered.
This instrument may be executed in any number of counterparts, each
of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
<PAGE> 76
67
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, all as of the day and year first above written.
HUNTINGTON BANCSHARES
INCORPORATED
By: /s/ JUDITH D. FISHER
------------------------------
Name: Judith D. Fisher
Title: Executive Vice President
THE CHASE MANHATTAN BANK, not
in its individual capacity, but solely as
Trustee
By: /s/ TIMOTHY E. BURKE
----------------------------
Name: Timothy E. Burke
Title: Second Vice President
<PAGE> 77
Exhibit A
THIS SECURITY (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY STATE
SECURITIES LAWS AND NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION
HEREIN MAY BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS
SECURITY IS HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM
THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A,
REGULATION S OR ANOTHER EXEMPTION THEREUNDER. THE HOLDER OF THIS SECURITY, BY
ITS ACCEPTANCE HEREOF, REPRESENTS, ACKNOWLEDGES AND AGREES FOR THE BENEFIT OF
THE COMPANY THAT: (I) IT HAS ACQUIRED A "RESTRICTED" SECURITY WHICH HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT; OR (II) IT WILL NOT OFFER, SELL OR
OTHERWISE TRANSFER THIS SECURITY PRIOR TO THE LATER OF THE DATE WHICH IS THREE
YEARS AFTER THE DATE OF ORIGINAL ISSUANCE HEREOF AND THE LAST DATE ON WHICH THE
COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF SUCH RESTRICTED
SECURITIES (OR ANY PREDECESSOR) EXCEPT (A) TO THE COMPANY, (B) PURSUANT TO A
REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, (C) FOR SO LONG AS THIS SECURITY IS ELIGIBLE FOR RESALE PURSUANT TO RULE
144A, TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (D) OUTSIDE THE UNITED STATES
IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 904 UNDER THE SECURITIES ACT,
(E) TO AN INSTITUTIONAL "ACCREDITED INVESTOR," WITHIN THE MEANING OF
SUBPARAGRAPH (A)(1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT
IS ACQUIRING THE SECURITIES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN
INSTITUTIONAL "ACCREDITED INVESTOR," FOR INVESTMENT PURPOSES AND NOT WITH A VIEW
TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF
THE SECURITIES ACT OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND, IN EACH CASE, IN ACCORDANCE
WITH THE APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY
APPLICABLE JURISDICTION; AND (III) IT WILL, AND EACH SUBSEQUENT HOLDER IS
REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THIS SECURITY OF THE RESALE
RESTRICTIONS SET FORTH IN (II) ABOVE. ANY OFFER, SALE OR OTHER DISPOSITION
PURSUANT TO THE FOREGOING CLAUSES (II)(D), (E) AND (F) IS SUBJECT TO THE RIGHT
OF THE ISSUER OF THIS SECURITY AND THE PROPERTY TRUSTEE FOR SUCH SECURITIES TO
REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATIONS OR OTHER
INFORMATION ACCEPTABLE TO THEM IN FORM AND SUBSTANCE.
<PAGE> 78
Huntington Bancshares Incorporated
Floating Rate Junior Subordinated Debenture due 2027
$206,186,000
No. D-1
HUNTINGTON BANCSHARES INCORPORATED, a corporation duly organized and
existing under the laws of the State of Maryland (herein called the "Company",
which term includes any successor corporation under the Indenture hereinafter
referred to), for value received, hereby promises to pay to The Chase Manhattan
Bank, as Trustee, or registered assigns, the principal sum of TWO HUNDRED AND
SIX MILLION, ONE HUNDRED AND EIGHTY-SIX THOUSAND DOLLARS ($206,186,000) on
February 1, 2027, and to pay interest on said principal sum from January 31,
1997 or from the most recent interest payment date (each such date, an "Interest
Payment Date") to which interest has been paid or duly provided for, quarterly
(subject to deferral as set forth herein) in arrears on the last day of January,
April, July and October of each year, commencing April 30, 1997, at a variable
per annum rate equal to LIBOR (as defined in the Indenture) plus 0.70% until the
principal hereof shall have become due and payable (plus Additional Interest, if
any), and on any overdue principal and (without duplication and to the extent
that payment of such interest is enforceable under applicable law) on any
overdue installment of interest at the same rate per annum; provided that, if
all amounts due hereunder are paid on February 1, 2027, the final Interest
Payment Date shall be February 1, 2027 (and not January 31, 2027) and interest
will accrue from the most recent Interest Payment Date prior to February 1, 2027
on which interest has been paid or duly provided for up to and including January
31, 2027. The amount of interest payable will be computed on the basis of the
actual number of days elapsed in a year of twelve 30-day months. The amount of
interest payable for any period shorter than a full quarterly period for which
interest is computed, will be computed on the basis of actual number of days
elapsed in such 90-day quarterly period. In the event that any date on which
interest is payable on this Security is not a Business Day, then a payment of
the interest payable on such date will be made on the next succeeding day which
is a Business Day (and without any interest or other payment in respect of any
such delay), except that, if such Business Day is the next succeeding calendar
year, such payment of the interest payable shall be on the immediately
proceeding Business Day, with the same force and effect as if made on the date
the payment was originally payable. A "Business Day" shall mean any day other
than a Saturday or a Sunday or a day on which banking institutions in the City
of New York or the City of Columbus, are authorized or required by law or
executive order to remain closed or a day on which the Corporate Trust Office of
the Trustee, or the principal office of the Property Trustee under the
Declaration, is closed for business. The interest installment so payable, and
punctually paid or duly provided for, on any Interest Payment Date will, as
provided in the Indenture, be paid to the Person in whose name the Securities
(or one or more Predecessor
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<PAGE> 79
Securities, as defined in the Indenture) is registered at the close of business
on the Regular Record Date for such interest installment, which shall be the
fifteenth day of the month of such Interest Payment Date. Any such interest
installment not so punctually paid or duly provided for shall forthwith cease to
be payable to the Holder on such Regular Record Date and may either be paid to
the Person in whose name the Securities for one or more Predecessor Securities
is registered at the close of business on a Special Record Date for the payment
of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be
given to Holders of Securities not less than 10 days prior to such Special
Record Date, or be paid at any time in any other lawful manner not inconsistent
with the requirements of any securities exchange on which the Securities may be
listed, and upon such notice as may be required by such exchange, all as more
fully provided in said Indenture.
The Company shall have the right at any time during the term of this
Security, from time to time, to defer payment of interest on such Security for
up to 20 consecutive quarterly periods (each, an "Extension Period"), provided
that no Extension Period may extend past the Maturity of this Security. There
may be multiple Extension Periods of varying lengths during the term of this
Security. At the end of each Extension Period, if any, the Company shall pay all
interest then accrued and unpaid, together with interest thereon, compounded
quarterly at the rate specified on this Security to the extent permitted by
applicable law. During any such Extension Period, the Company may not, and may
not permit any subsidiary of the Company to, (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire, or make a liquidation payment
with respect to, any of the Company's capital stock or (ii) make any payment of
principal, interest or premium, if any, on or repay, repurchase or redeem any
debt securities of the Company that rank pari passu with or junior in interest
to the Securities or make any guarantee payments with respect to any guarantee
by the Company of the debt securities of any subsidiary of the Company if such
guarantee ranks pari passu or junior in interest to the Securities (other than
(a) repurchases, redemptions or other acquisitions of shares of capital stock of
the Company in connection with any employment contract, benefit plan or other
similar arrangement with or for the benefit of any one or more employees,
officers, directors or consultants or in connection with a dividend reinvestment
or stockholder stock purchase plan, (b) as a result of an exchange or conversion
of any class or series of the Company's capital stock (or any capital stock of a
subsidiary of the Company) for any other class or series of the Company's
capital stock or of any class or series of the Company's indebtedness for any
class or series of the Company's capital stock, (c) the purchase of fractional
interests in shares of the Company's capital stock pursuant to the conversion or
exchange provisions of such capital stock or the security being converted or
exchanged, (d) any declaration of a dividend in connection with any
stockholder's rights plan, or the issuance of rights, stock or other property
under any stockholder's rights plan, or the redemption or repurchase of rights
pursuant thereto, or (e) any dividend in the form of stock, warrants, options or
other rights where the exercise of such warrants, options, or other rights is
the same stock as that on which the dividend is being paid or ranks pari passu
with or junior to such stock). Prior to the termination of any such Extension
Period, the Company may
-3-
<PAGE> 80
further extend the interest payment period, provided that no Extension Period
may exceed 20 consecutive quarterly periods or extend beyond the Stated Maturity
of the Securities. Upon the termination of any such Extension Period and the
payment of all amounts then due on any Interest Payment Date, the Company may
elect to begin a new Extension Period subject to the above requirements. No
interest shall be due and payable during an Extension Period, except at the end
thereof. The Company shall give the Trustee notice of its election of such
Extension Period at least one Business Day prior to the record date for the
related interest payment.
Payment of the principal of and interest on this Security will be
made at the office or agency of the Paying Agent maintained for that purpose, in
such coin or currency of the United States of America as at the time of payment
is legal tender for payment of public and private debts; provided, however, that
at the option of the Company, payment of interest may be made (i) by check
mailed to the address of the Person entitled thereto as such address shall
appear in the Security Register or (ii) for Holders of Securities within an
aggregate principal amount of at least $1,000,000, by wire transfer in
immediately available funds at such place and to such account as may be
designated by the Person entitled thereto as specified in the Security Register.
The indebtedness evidenced by this Security is, to the extent
provided in the Indenture, subordinate and subject in right of payment to the
prior payment in full of all Indebtedness, and this Security is issued subject
to the provisions of the Indenture with respect thereto. Each Holder of this
Security, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on his behalf to take such
action as may be necessary or appropriate to effectuate the subordination so
provided and (c) appoints the Trustee his attorney-in-fact for any and all such
purposes. Each Holder hereof, by his acceptance hereof, waives all notice of the
acceptance of the subordination provisions contained herein and in the Indenture
by each holder of Indebtedness, whether now outstanding or hereafter incurred,
and waives reliance by each such holder upon said provisions.
Reference is hereby made to the further provisions of the Indenture
summarized on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
-4-
<PAGE> 81
IN WITNESS WHEREOF, Huntington Bancshares Incorporated has caused
this instrument to be duly executed.
Dated: January 31, 1997
HUNTINGTON BANCSHARES
INCORPORATED
By:___________________________________________
Name:
Title:
-5-
<PAGE> 82
This Security is one of a duly authorized issue of Securities of
Huntington Bancshares Incorporated (the "Company"), designated as its Floating
Rate Junior Subordinated Debentures due 2027 (herein called the "Securities"),
issued under an Indenture, dated as of January 31, 1997 (herein called the
"Indenture"), between the Company and The Chase Manhattan Bank, a New York
banking corporation, as Trustee (herein called the "Trustee," which term
includes any successor trustee under the Indenture), to which Indenture and all
indentures supplemental thereto reference is hereby made for a statement of the
respective rights, limitations of rights, duties and immunities thereunder of
the Trustee, the Company and the Holders of the Securities, and of the terms
upon which the Securities are, and are to be, authenticated and delivered.
All terms used in this Security which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
At any time on or after February 1, 2007, the Company shall have the
right, subject to the terms and conditions of Article Twelve of the Indenture,
to redeem this Security at the option of the Company, in whole or in part, at a
Redemption Price equal to the principal amount so redeemed plus accrued but
unpaid interest (including any Additional Interest) to the Redemption Date.
If a Special Event (as defined in the Indenture) shall occur and be
continuing, the Company shall have the right, subject to the terms and
conditions of Article Twelve of the Indenture, to redeem this Security at the
option of the Company, without premium or penalty, in whole but not in part, at
a Redemption Price equal to 100% of the principal amount so redeemed plus
accrued but unpaid interest (including any Additional Interest) to the
Redemption Date. Any redemption pursuant to this paragraph will be made upon not
less than 30 nor more than 60 days notice, at the Redemption Price. If the
Securities are only partially redeemed by the Company, the Securities will be
redeemed by lot (or such other method of selection as the Trustee may
customarily employ). In the event of redemption of this Security in part only, a
new Security or Securities for the unredeemed portion hereof will be issued in
the name of the Holder hereof upon the cancellation hereof.
If an Event of Default with respect to the Securities shall occur and
be continuing, the principal of the Securities may be declared due and payable
in the manner, with the effect and subject to the conditions provided in the
Indenture.
The Indenture contains provisions for satisfaction and discharge or
legal defeasance of the entire indebtedness of this Security and for the
defeasance of certain covenants under the Indenture at any time upon compliance
by the Company with certain conditions set forth in the Indenture.
-6-
<PAGE> 83
The Indenture contains provisions permitting the Company and the
Trustee, with the consent of Holders of not less than a majority in principal
amount of the Outstanding Securities affected by such modification, to modify
the Indenture in a manner affecting the rights of the Holders of the Securities;
provided that so such modification may, without the consent of the Holder of
each Outstanding Security affected thereby, (i) except to the extent permitted
and subject to the conditions set forth in the Indenture with respect to the
extension of the Maturity of the Security, change the maturity of, the principal
of, or any installment of interest on, the Security or reduce the principal
amount thereof, or the rate of payment of interest thereon, or change the place
of payment where, or the coin or currency in which, this Security or interest
thereon is payable, or impair the right to institute suit for the enforcement of
such payment on or after the Maturity thereof (or, in the case of redemption, on
or after the Redemption Date), or modify the provisions of the Indenture with
respect to the subordination of the Securities in a manner adverse to the
Holders, (ii) reduce the percentage in principal amount of the Outstanding
Securities, the consent of whose Holders is required for such supplemental
Indenture or the consent of whose Holders is required for any waiver (of
compliance with certain provisions of the Indenture or certain defaults
hereunder and their consequences) provided for in the Indenture, or (iii) modify
any of the provisions of Section 513, Section 902 or Section 1008 of the
Indenture, except to increase any such percentage or to provide that certain
other provisions of the Indenture cannot be modified or waived without the
consent of the Holder of each Outstanding Security affected thereby, provided
that, so long as any of the Capital Securities remains outstanding, no such
amendment shall be made that adversely affects the holders of the Capital
Securities, and no termination of the Indenture shall occur, and no waiver of an
Event of Default or compliance with any covenant under this Indenture shall be
effective, without the prior consent of the holders of at least a majority of
the aggregate liquidation preference of the outstanding Capital Securities
unless and until the principal of and any premium on the Securities and all
accrued and unpaid interest thereon have been paid in full.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and
interest on this Security at the times, place and rate, and in the coin or
currency, herein prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in New York, New York, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Securities,
of authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees. No service charge shall be
made for any such registration
-7-
<PAGE> 84
of transfer or exchange, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
The Securities are issuable only in registered form without coupons
in denominations of $1,000 and any integral multiple thereof. As provided in the
Indenture and subject to certain limitations therein set forth, Securities are
exchangeable for a like aggregate principal amount of Securities of a different
authorized denomination, as requested by the Holder surrendering the same.
THE SECURITIES AND THE INDENTURE SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
This is one of the Securities referred to in the within-mentioned
Indenture.
THE CHASE MANHATTAN BANK,
as Trustee
By:_________________________
Authorized Signatory
Dated: January 31, 1997
-8-
<PAGE> 85
In connection with any transfer of this Security occurring prior to
the date which is the earlier of (i) the date of the declaration by the
Commission of the effectiveness of a registration statement under the Securities
Act covering resales of this Security (which effectiveness shall not have been
suspended or terminated at the date of the transfer) and (ii) three years after
the later of the date of original issue and the last date on which the Company
or any affiliate of the Company was the owner of such Security (or any
predecessor thereto) (the "Resale Restriction Termination Date"), the
undersigned confirms that it has not utilized any general solicitation or
general advertising in connection with the transfer:
[CHECK ONE]
(1) ___ to the Company or a subsidiary thereof; or
(2) ___ pursuant to and in compliance with Rule 144A under the Securities Act of
1933, as amended; or
(3) ___ to an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as amended)
that has furnished to the Trustee a signed letter containing certain
representations and agreements (the form of which letter can be obtained
from the Trustee); or
(4) ___ outside the United States to a "foreign person" in compliance with
Rule 904 of Regulation S under the Securities Act of 1933, as amended;
or
(5) ___ pursuant to the exemption from registration provided by Rule 144 under
the Securities Act of 1933, as amended; or
(6) ___ pursuant to an effective registration statement under the Securities
Act of 1933, as amended; or
(7) ___ pursuant to another available exemption from the registration
requirements of the Securities Act of 1933, as amended.
Unless one of the boxes is checked, the Trustee will refuse to register any of
the Securities evidenced by this certificate in the name of any person other
than the registered Holder thereof; provided, however, that if box (3), (4), (5)
or (7) is checked, the Company or the Trustee may require, prior to registering
any such transfer of the Securities, in its sole discretion, such written legal
opinions, certifications (including an investment letter in the case of box (3)
or (4)) and other information as the Trustee or the Company has reasonably
requested to confirm that such transfer is being made pursuant to an exemption
from, or in a transaction not subject to, the registration requirements of the
Securities Act of 1933, as amended.
-9-
<PAGE> 86
10
If none of the foregoing boxes is checked, the Trustee or Registrar shall not be
obligated to register this Security in the name of any person other than the
Holder hereof unless and until the conditions to any such transfer of
registration set forth herein and in Section 315 of the Indenture shall have
been satisfied.
Dated: __________________ Signed:_____________________________
(Sign exactly as name appears
on the other side of this
Security)
Signature Guarantee:__________________________
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing this
Security for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act
and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Company as the
undersigned has requested pursuant to Rule 144A or has determined not to request
such information and that it is aware that the transferor is relying upon the
undersigned's foregoing representations in order to claim the exemption from
registration provided by Rule 144A.
Dated: ________ ______________________________________________
NOTICE: To be executed by an executive officer
<PAGE> 1
Exhibit 4(b)
CERTIFICATE OF TRUST
OF
HUNTINGTON CAPITAL I
THIS Certificate of Trust of Huntington Capital I (the
"Trust"), dated as of January 23, 1997, is being duly executed and filed by the
undersigned, as trustees, to form a business trust under the Delaware Business
Trust Act (12 Del. C. ss.3801, et seq.).
1. NAME. The name of the business trust formed hereby is
Huntington Capital I.
2. DELAWARE TRUSTEE. The name and business address of the
trustee of the Trust with a principal place of business in the State of Delaware
are Chase Manhattan Bank Delaware, 1201 Market Street, Wilmington, Delaware
19801.
3. EFFECTIVE DATE. This Certificate of Trust shall be
effective upon filing.
IN WITNESS WHEREOF, the undersigned, being the trustees of
the Trust, have executed this Certificate of Trust as of the date first-above
written.
CHASE MANHATTAN BANK DELAWARE,
not in its individual capacity but
solely as trustee of the Trust
By: /s/ JOHN J. CASHIN
--------------------------------
Name: John J. Cashin
Title: Senior Trust Officer
PAUL V. SEBERT, not in his individual
capacity but solely as trustee of the
Trust
/s/ PAUL V. SEBERT
------------------------------------
<PAGE> 1
Exhibit 4(c)
AMENDED AND RESTATED DECLARATION OF TRUST
HUNTINGTON CAPITAL I
Dated as of January 31, 1997
<PAGE> 2
TABLE OF CONTENTS
Page
ARTICLE 1
INTERPRETATION AND DEFINITIONS ............. 1
Section 1.1 Interpretation and Definitions ........................... 1
Affiliate ............................................................. 2
Authorized Officer .................................................... 2
Business Day .......................................................... 2
Business Trust Act .................................................... 2
Capital Security ...................................................... 2
Capital Security Beneficial Owner ..................................... 2
Capital Security Certificate .......................................... 2
Cedel ................................................................. 2
Certificate ........................................................... 2
Certificate of Trust .................................................. 3
Closing Date .......................................................... 3
Code .................................................................. 3
Commission ............................................................ 3
Common Securities Holder .............................................. 3
Common Security ....................................................... 3
Common Security Certificate ........................................... 3
Corporate Trust Office ................................................ 3
Covered Person ........................................................ 3
Custodian ............................................................. 3
Debenture Issuer ...................................................... 3
Debenture Issuer Indemnified Person ................................... 3
Debenture Trustee ..................................................... 3
Debentures ............................................................ 4
Delaware Trustee ...................................................... 4
Depositary ............................................................ 4
Direct Action ......................................................... 4
Distribution .......................................................... 4
DTC ................................................................... 4
DWAC .................................................................. 4
Euroclear ............................................................. 4
Exchange Act .......................................................... 4
Federal Reserve ....................................................... 4
Fiduciary Indemnified Person .......................................... 4
Fiscal Year ........................................................... 4
Global Security ....................................................... 4
Guarantee ............................................................. 4
i
<PAGE> 3
Page
Holder ................................................................ 4
Indemnified Person .................................................... 5
Indenture ............................................................. 5
Indenture Event of Default ............................................ 5
Initial Purchasers .................................................... 5
Institutional Accredited Investor ..................................... 5
Investment Company .................................................... 5
Investment Company Act ................................................ 5
Investment Company Event .............................................. 5
Legal Action .......................................................... 5
List of Holders ....................................................... 5
Luxembourg Paying and Transfer Agent .................................. 5
Majority in Liquidation Amount ........................................ 5
Officers' Certificate ................................................. 6
Paying Agent .......................................................... 6
ii
<PAGE> 4
AMENDED AND RESTATED DECLARATION OF TRUST
OF HUNTINGTON CAPITAL I
THIS AMENDED AND RESTATED DECLARATION OF TRUST ("Declaration") dated as
of January 31, 1997 between HUNTINGTON BANCSHARES INCORPORATED, a Maryland
corporation, as Sponsor, and Milton D. Baughman, Beth A. Russell and Paul V.
Sebert, as the initial Regular Trustees, THE CHASE MANHATTAN BANK, a New York
banking corporation, as the initial Property Trustee and CHASE MANHATTAN BANK
DELAWARE as the initial Delaware Trustee, not in their individual capacities but
solely as Trustees, and the holders, from time to time, of undivided beneficial
ownership interests in the assets of the Trust to be issued pursuant to this
Declaration.
WHEREAS, the Delaware Trustee and the Sponsor established Huntington
Capital I (the "Trust"), a business trust under the Business Trust Act (as
defined, together with other capitalized terms, herein) pursuant to a
Declaration of Trust dated as of January 23, 1997 (the "Original Declaration")
and a Certificate of Trust (the "Certificate of Trust") filed with the Secretary
of State of the State of Delaware on January 24, 1997; and
WHEREAS, the sole purpose of the Trust shall be to issue and sell
certain securities representing undivided beneficial ownership interests in the
assets of the Trust, to invest the proceeds from such sales in the Debentures
issued by the Debenture Issuer and to engage in only those activities necessary
or incidental thereto; and
WHEREAS, all of the Trustees and the Sponsor, by this Declaration,
amend and restate each and every term and provision of the Original Declaration.
NOW, THEREFORE, it being the intention of the parties hereto that the
Trust constitute a business trust under the Business Trust Act, the Trustees
hereby declare that all assets contributed to the Trust be held in trust for the
benefit of the Holders, from time to time, of the Securities representing
undivided beneficial ownership interests in the assets of the Trust issued
hereunder, subject to the provisions of this Declaration.
ARTICLE 1
INTERPRETATION AND DEFINITIONS
Section 1.1 Interpretation and Definitions.
Unless the context otherwise requires:
(a) capitalized terms used in this Declaration but not defined in the
preamble above have the respective meanings assigned to them in this Section
1.1;
(b) a term defined anywhere in this Declaration has the same meaning
throughout;
<PAGE> 5
2
(c) all references to "the Declaration" or "this Declaration" are to
this Declaration as modified, supplemented or amended from time to time;
(d) all references in this Declaration to Articles and Sections are to
Articles and Sections of this Declaration unless otherwise specified;
(e) a term defined in the Trust Indenture Act has the same meaning when
used in this Declaration unless otherwise defined in this Declaration or unless
the context otherwise requires; and
(f) a reference to the singular includes the plural and vice versa and
a reference to any masculine form of a term shall include the feminine form of a
term, as applicable.
"Affiliate" has the same meaning as given to that term in Rule 405 of
the Securities Act or any successor rule thereunder.
"Authorized Officer" of a Person means the Chairman of the Board, a
Vice Chairman of the Board, the Chief Executive Officer, the President, a Vice
President, the principal financial officer, the Treasurer, an Assistant
Treasurer, the Secretary or an Assistant Secretary of the Company.
"Business Day" means any day other than a Saturday or Sunday or a day
on which banking institutions in the City of New York or the City of Columbus
are authorized or required by law or executive order to remain closed or a day
on which the Corporate Trust Office of the Property Trustee is closed for
business.
"Business Trust Act" means Chapter 38 of Title 12 of the Delaware Code,
12 Del. C. Section 3801, et seq., as it may be amended from time to time, or any
successor legislation.
"Capital Security" has the meaning specified in Section 7.1.
"Capital Security Beneficial Owner" means, with respect to any
beneficial interest in a Global Security, ownership and transfers of which shall
be maintained and made through book entries by a Depositary, a Person who is the
beneficial owner of such beneficial interest, as reflected on the books of the
Depositary, or on the books of a Person maintaining an account with such
Depositary (as a direct or indirect participant, in each case in accordance with
the rules of such Depositary).
"Capital Security Certificate" means a certificate representing a
Capital Security.
"Cedel" means Cedel Bank, societe anonymne.
"Certificate" means a Common Security Certificate or a Capital Security
Certificate.
<PAGE> 6
3
"Certificate of Trust" has the meaning specified in the recitals
hereto.
"Closing Date" means the date or dates on which the Capital Securities
are issued and sold.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, or any successor legislation. A reference to a specific section of the
Code refers not only to such specific section but also to any corresponding
provision of any federal tax statute enacted after the date of this Declaration,
as such specific section or corresponding provision is in effect on the date of
application of the provisions of this Declaration containing such reference.
"Commission" means the Securities and Exchange Commission.
"Common Securities Holder" means Huntington Bancshares Incorporated in
its capacity as purchaser and holder of all of the Common Securities issued by
the Trust.
"Common Security" has the meaning specified in Section 7.1
"Common Security Certificate" means a definitive certificate in fully
registered form representing a Common Security.
"Corporate Trust Office" means the office of the Property Trustee at
which the corporate trust business of the Property Trustee shall, at any
particular time, be principally administered, which office at the date of
execution of this Declaration is located at 450 West 33rd Street, New York, New
York 10001, Attention: Global Trust Services.
"Covered Person" means (a) any trustee, officer, director, shareholder,
partner, member, representative, employee or agent of (i) the Trust or (ii) the
Trust's Affiliates; and (b) any Holder of Securities.
"Custodian" means The Chase Manhattan Bank.
"Debenture Issuer" means Huntington Bancshares Incorporated in its
capacity as issuer of the Debentures under the Indenture.
"Debenture Issuer Indemnified Person" means (a) any Regular Trustee;
(b) any Affiliate of any Regular Trustee; (c) any officers, directors,
shareholders, members, partners, employees, representatives or agents of any
Regular Trustee or any Affiliate thereof; or (d) any officer, employee or agent
of the Trust or its Affiliates.
"Debenture Trustee" means The Chase Manhattan Bank, in its capacity as
trustee under the Indenture until a successor is appointed thereunder, and
thereafter means such successor trustee.
<PAGE> 7
4
"Debentures" means the Securities (as defined in the Indenture) to be
issued by the Debenture Issuer and to be held by the Property Trustee.
"Delaware Trustee" has the meaning set forth in Section 6.2.
"Depositary" means, with respect to Securities issuable in whole or in
part in the form of one or more Global Securities, a clearing agency registered
under the Exchange Act that is designated to act as Depositary for such
Securities.
"Direct Action" has the meaning set forth in Section 3.8(e).
"Distribution" means a distribution payable to Holders of Securities in
accordance with Section 7.2.
"DTC" means The Depository Trust Company, the initial Depositary.
"DWAC" means Deposit and Withdrawal At Custodian Service.
"Euroclear" means Morgan Guaranty Trust Company of New York, Brussels
office, as operator of the Euroclear System.
"Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time, or any successor legislation.
"Federal Reserve" means the Board of Governors of the Federal Reserve
System, as from time to time constituted, or if at any time after the execution
of this Indenture the Federal Reserve is not existing and performing the duties
now assigned to it, then the body performing such duties at such time.
"Fiduciary Indemnified Person" has the meaning set forth in Section
9.4(b).
"Fiscal Year" has the meaning set forth in Section 10.1.
"Global Security" has the meaning set forth in Section 7.11.
"Guarantee" means the guarantee agreement of the Sponsor in respect of
the Capital Securities and the Common Securities.
"Holder" means a Person in whose name a Certificate representing a
Security is registered, such Person being a beneficial owner within the meaning
of the Business Trust Act; provided, however, that in determining whether the
Holders of the requisite liquidation amount of Capital Securities have voted on
any matter provided for in this Declaration, then for the purpose of such
determination only (and not for any other purpose hereunder), if the Capital
Securities remain in the form of one or more Global Securities, the term
"Holders" shall mean the holder of the Global Security acting at the direction
of the beneficial owners of the Capital Securities.
<PAGE> 8
5
"Indemnified Person" means a Debenture Issuer Indemnified Person or a
Fiduciary Indemnified Person.
"Indenture" means the Indenture dated as of January 31, 1997, between
the Debenture Issuer and the Debenture Trustee, and any indenture supplemental
thereto pursuant to which the Debentures are to be issued.
"Indenture Event of Default" means an "Event of Default" as defined in
the Indenture.
"Initial Purchasers" means Morgan Stanley & Co. Incorporated, Lehman
Brothers Inc. and Salomon Brothers Inc.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as the term is defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act.
"Investment Company" means an investment company as defined in the
Investment Company Act and the regulations promulgated thereunder.
"Investment Company Act" means the Investment Company Act of 1940, as
amended from time to time, or any successor legislation.
"Investment Company Event" means the receipt by the Trust of an opinion
of counsel, rendered by a law firm experienced in such matters, to the effect
that, as a result of the occurrence of a change in law or regulation by any
legislative body, court, governmental agency or regulatory authority (a "Change
in 1940 Act Law"), the Trust is or will be considered an "investment company"
that is required to be registered under the Investment Company Act, which Change
in 1940 Act Law becomes effective on or after the Closing Date.
"Legal Action" has the meaning set forth in Section 3.6(g).
"List of Holders" has the meaning specified in Section 2.2(a).
"Luxembourg Paying and Transfer Agent" shall have the meaning set forth
in Section 3.6.
"Majority in Liquidation Amount" means, except as provided in the terms
of the Capital Securities or by the Trust Indenture Act, Holder(s) of
outstanding Securities, voting together as a single class, or, as the context
may require, Holders of outstanding Capital Securities or Holders of outstanding
Common Securities, voting separately as a class, who are the record owners of
more than 50% of the aggregate liquidation amount (including the stated amount
that would be paid on redemption, liquidation or otherwise, plus accrued and
unpaid Distributions to the date upon which the voting percentages are
determined) of all outstanding Securities of the relevant class.
<PAGE> 9
6
"Officers' Certificate" means, with respect to any Person (other than
Regular Trustees who are natural persons), a certificate signed by two
Authorized Officers of such Person on behalf of such Person. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Declaration shall include:
(a) a statement that each officer signing the Officers' Certificate has
read the covenant or condition and the definitions relating thereto;
(b) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(c) a statement as to whether, in the opinion of each such officer and
on behalf of such Person, such condition or covenant has been complied with;
provided, that the term "Officers' Certificate", when used with reference to
Regular Trustees who are natural persons shall mean a certificate signed by two
of the Regular Trustees which otherwise satisfies the foregoing requirements.
"Paying Agent" has the meaning specified in Section 3.8(h).
"Payment Amount" has the meaning specified in Section 7.2(a).
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof or any other entity of whatever nature.
"PORTAL" has the meaning specified in Section 3.6
"Private Placement Legend" has the meaning specified in Section 314 of
the Indenture.
"Property Account" has the meaning specified in Section 3.8(c).
"Property Trustee" means the Trustee meeting the eligibility
requirements set forth in Section 6.3.
"Pro Rata" means pro rata to each Holder of Securities according to the
aggregate liquidation amount of the Securities held by the relevant Holder in
relation to the aggregate liquidation amount of all Securities outstanding.
"Qualified Institutional Buyer" or "QIB" has the meaning specified in
Rule 144A under the Securities Act.
"Quorum" means a majority of the Regular Trustees or, if there are only
two Regular Trustees, both of them.
<PAGE> 10
7
"Redemption Price" has the meaning specified in Section 7.3(a).
"Registration Rights Agreement" means the Registration Rights Agreement
dated the date hereof between the Sponsor, the Trust and the Initial Purchasers
for the benefit of themselves and the Holders as the same may be amended from
time to time in accordance with the terms thereof.
"Regular Trustee" means any Trustee other than the Property Trustee and
the Delaware Trustee.
"Regulation S" means Regulation S under the Securities Act and any
successor regulation thereto.
"Regulation S Global Security" means any Global Security or Securities
evidencing Securities that are to be traded pursuant to Regulation S.
"Regulatory Capital Event" means that the Debenture Issuer shall have
received an opinion of independent bank regulatory counsel experienced in such
matters to the effect that, as a result of (a) any amendment to or change
(including any announced prospective change) in the laws (or any regulations
thereunder) of the United States or any rules, guidelines or policies of the
Federal Reserve or (b) any official or administrative pronouncement or action or
judicial decision for interpreting or applying such laws or regulations, which
amendment or change is effective or such pronouncement or decision is announced
on or after the date of original issuance of the Capital Securities, the Capital
Securities do not constitute, or within 90 days of the date thereof, will not
constitute Tier 1 capital (or its then equivalent); provided, however, that the
distribution of the Debentures in connection with the liquidation of the Trust
by the Debenture Issuer shall not in and of itself constitute a Regulatory
Capital Event unless such liquidation shall have occurred in connection with a
Tax Event or an Investment Company Event.
"Related Party" means, with respect to the Sponsor, any direct or
wholly owned subsidiary of the Sponsor.
"Responsible Officer", when used with respect to the Property Trustee,
means any officer within the Corporate Trust Office, including any
Vice-President, any Assistant Vice-President, the Secretary, any Assistant
Secretary or any other officer of the Property Trustee customarily performing
functions similar to those performed by any of the above designated officers and
also means, with respect to a particular corporate trust matter, any other
officer to whom such matter is referred because of that officer's knowledge of
and familiarity with the particular subject.
"Restricted Global Security" means any Global Security or Securities
evidencing Securities that are to be sold pursuant to Rule 144A.
"Restricted Period" shall mean the period prior to or on the fortieth
day after the later of the commencement of the offering of the Capital
Securities and the Closing Date.
<PAGE> 11
8
"Restricted Security" has the meaning assigned to such term in Rule
144(a)(3) under the Securities Act.
"Rule 144A" means Rule 144A under the Securities Act.
"Rule 3a-7" means Rule 3a-7 under the Investment Company Act or any
successor rule thereunder.
"Securities" means the Common Securities and the Capital Securities.
"Securities Act" means the Securities Act of 1933, as amended from time
to time, or any successor legislation.
"Special Event" means a Tax Event, a Regulatory Capital Event or an
Investment Company Event.
"Sponsor" means Huntington Bancshares Incorporated, a Maryland
corporation, or any successor entity in a merger, consolidation or amalgamation,
in its capacity as sponsor of the Trust.
"Successor Delaware Trustee" has the meaning specified in Section
6.6(b).
"Successor Entity" has the meaning specified in Section 3.15(b)(i).
"Successor Property Trustee" has the meaning specified in Section
6.6(b).
"Successor Security" has the meaning specified in Section 3.15(b)(i)b.
"Super Majority" has the meaning set forth in Section 2.6(a)(ii).
"Tax Event" means the receipt by the Debenture Issuer of an opinion of
counsel, rendered by a law firm experienced in such matters, to the effect that,
as a result of any amendment to, change in or announced proposed change in the
laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein, or as a result of any
official or administrative pronouncement or action or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
adopted or which proposed change, pronouncement or decision is announced or
which action is taken on or after the Closing Date, there is more than an
insubstantial risk that (i) the Trust is, or will be within 90 days of the date
of such opinion, subject to the United States federal income tax with respect to
income received or accrued on the Debentures, (ii) interest payable by the
Debenture Issuer on such Debentures is not, or within 90 days of the date of
such opinion, will not be deductible by the Debenture Issuer, in whole or in
part, for United States federal income tax purposes, or (iii) the Trust is, or
will be within 90 days of the date of such opinion, subject to more than a de
minimus amount of other taxes, duties or other governmental charges.
<PAGE> 12
9
"10% in Liquidation Amount" means, except as provided in the terms of
the Capital Securities or by the Trust Indenture Act, Holder(s) of outstanding
Securities, voting together as a single class, or, as the context may require,
Holders of outstanding Capital Securities or Holders of outstanding Common
Securities, voting separately as a class, who are the record owners of 10% or
more of the aggregate liquidation amount (including the stated amount that would
be paid on redemption, liquidation or otherwise, plus accrued and unpaid
Distributions to the date upon which the voting percentages are determined) of
all outstanding Securities of the relevant class.
"Treasury Regulations" means the income tax regulations, including
temporary and proposed regulations, promulgated under the Code by the United
States Treasury, as such regulations may be amended from time to time (including
corresponding provisions of succeeding regulations).
"Trust Enforcement Event" in respect of the Securities means an
Indenture Event of Default has occurred and is continuing in respect of the
Debentures.
"Trust Indenture Act" means the Trust Indenture Act of 1939, as amended
from time to time, or any successor legislation.
"Trustee" or "Trustees" means each Person who has signed this
Declaration as a trustee, so long as such Person shall continue in office in
accordance with the terms hereof, and all other Persons who may from time to
time be duly appointed, qualified and serving as Trustees in accordance with the
provisions hereof, and references herein to a Trustee or the Trustees shall
refer to such Person or Persons solely in their capacity as trustees hereunder.
"Trustees' Authorization Certificate" means a written certificate
signed by two of the Regular Trustees for the purpose of establishing the terms
and form of the Capital Securities and the Common Securities as determined by
the Regular Trustees.
ARTICLE 2
TRUST INDENTURE ACT
Section 2.1 Trust Indenture Act; Application.
(a) This Declaration is subject to the provisions of the Trust
Indenture Act that are required to be part of this Declaration and shall, to the
extent applicable, be governed by such provisions.
(b) The Property Trustee shall be the only Trustee which is a trustee
for the purposes of the Trust Indenture Act.
<PAGE> 13
10
(c) If and to the extent that any provision of this Declaration
conflicts with the duties imposed by Sections 310 to 317, inclusive, of the
Trust Indenture Act, such imposed duties shall control.
(d) The application of the Trust Indenture Act to this Declaration
shall not affect the Trust's classification as a grantor trust for United States
federal income tax purposes and shall not affect the nature of the Securities as
equity securities representing undivided beneficial ownership interests in the
assets of the Trust.
Section 2.2 Lists of Holders of Securities.
(a) Each of the Sponsor and the Regular Trustees on behalf of the Trust
shall provide the Property Trustee with a list, in such form as the Property
Trustee may reasonably require, of the names and addresses of the Holders of the
Securities ("List of Holders"), (i) not later than June 30 and December 31 of
each year and current as of such date, and (ii) at any other time, within 30
days of receipt by the Trust of a written request from the Property Trustee for
a List of Holders as of a date no more than 15 days before such List of Holders
is given to the Property Trustee; provided that neither the Sponsor nor the
Regular Trustees on behalf of the Trust shall be obligated to provide such List
of Holders at any time the List of Holders does not differ from the most recent
List of Holders given to the Property Trustee by the Sponsor and the Regular
Trustees on behalf of the Trust. The Property Trustee shall preserve, in as
current a form as is reasonably practicable, all information contained in Lists
of Holders given to it or which it receives in the capacity as Paying Agent (if
acting in such capacity), provided that the Property Trustee may, but shall not
be obligated to, destroy any List of Holders previously given to it on receipt
of a new List of Holders.
(b) The Property Trustee shall comply with its obligations under, and
shall be entitled to the benefits of, Sections 311(a), 311(b) and 312(b) of the
Trust Indenture Act.
Section 2.3 Reports by the Property Trustee.
Within 60 days after May 15 of each year (commencing in the year of the
first anniversary of the issuance of the Capital Securities), the Property
Trustee shall provide to the Holders of the Capital Securities such reports as
are required by Section 313 of the Trust Indenture Act, if any, in the form and
in the manner provided by Section 313 of the Trust Indenture Act. The Property
Trustee shall also comply with the requirements of Section 313(d) of the Trust
Indenture Act.
Section 2.4 Periodic Reports to the Property Trustee.
Each of the Sponsor and the Regular Trustees on behalf of the Trust
shall provide to the Property Trustee such documents, reports and information as
required by Section 314 of the Trust Indenture Act (if any) and the compliance
certificate required by Section 314 of the Trust Indenture Act in the form, in
the manner and at the times required by Section 314 of the Trust Indenture Act
and an Officer's Certificate as to its compliance with all
<PAGE> 14
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conditions and covenants under this Declaration on an annual basis on or before
120 days after the end of each fiscal year of the Sponsor.
Section 2.5 Evidence of Compliance with Conditions Precedent.
Each of the Sponsor and the Regular Trustees on behalf of the Trust
shall provide to the Property Trustee such evidence of compliance with any
conditions precedent, if any, provided for in this Declaration that relate to
any of the matters set forth in Section 314(c) of the Trust Indenture Act. Any
certificate or opinion required to be given by an officer pursuant to Section
314(c)(1) shall be given in the form of an Officers' Certificate.
Section 2.6 Trust Enforcement Events; Waiver.
(a) The Holders of a Majority in Liquidation Amount of the Capital
Securities may, by vote or written consent, on behalf of the Holders of all of
the Capital Securities, waive any past Trust Enforcement Event in respect of the
Capital Securities and its consequences, provided that, if the underlying
Indenture Event of Default:
(i) is not waivable under the Indenture, the Trust Enforcement Event
under the Declaration shall also not be waivable; or
(ii) requires the consent or vote of greater than a majority in
principal amount of the holders of the Debentures (a "Super
Majority") to be waived under the Indenture, the Trust Enforcement
Event under the Declaration may only be waived by the vote or
written consent of the Holders of at least the proportion in
liquidation amount of the Capital Securities that the relevant
Super Majority represents of the aggregate principal amount of the
Debentures outstanding.
The foregoing provisions of this Section 2.6(a) shall be in lieu of
Section 316(a)(1)(B) of the Trust Indenture Act and such Section 316(a)(1)(B) of
the Trust Indenture Act is hereby expressly excluded from this Declaration and
the Securities, as permitted by the Trust Indenture Act. Upon such waiver, any
such default shall cease to exist, and any Trust Enforcement Event with respect
to the Capital Securities arising therefrom shall be deemed to have been cured,
for every purpose of this Declaration and the Capital Securities, but no such
waiver shall extend to any subsequent or other Trust Enforcement Event with
respect to the Capital Securities or impair any right consequent thereon. Any
waiver by the Holders of the Capital Securities of a Trust Enforcement Event
with respect to the Capital Securities shall also be deemed to constitute a
waiver by the Holders of the Common Securities of any such Trust Enforcement
Event with respect to the Common Securities for all purposes of this Declaration
without any further act, vote, or consent of the Holders of the Common
Securities.
(b) The Holders of a Majority in Liquidation Amount of the Capital
Securities will have the right to direct the time, method and place of
conducting any proceeding of any remedy available to the Property Trustee or to
direct the exercise of any trust or power
<PAGE> 15
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conferred upon the Property Trustee, including the right to direct the Property
Trustee to exercise the remedies available to it as Holder of the Debentures.
(c) The Holders of a Majority in Liquidation Amount of the Common
Securities may, by vote or written consent, on behalf of the Holders of all of
the Common Securities, waive any past Trust Enforcement Event in respect of the
Common Securities and its consequences, provided that, if the underlying
Indenture Event of Default:
(i) is not waivable under the Indenture, except where the Holders of
the Common Securities are deemed to have waived such Trust
Enforcement Event under the Declaration as provided below in this
Section 2.6(c), the Trust Enforcement Event under the Declaration
shall also not be waivable; or
(ii) requires the consent or vote of a Super Majority to be waived
under the Indenture, except where the Holders of the Common
Securities are deemed to have waived such Trust Enforcement Event
under the Declaration as provided below in this Section 2.6(c),
the Trust Enforcement Event under the Declaration may only be
waived by the vote or written consent of the Holders of at least
the proportion in liquidation amount of the Common Securities that
the relevant Super Majority represents of the aggregate principal
amount of the Debentures outstanding;
provided further, each Holder of Common Securities will be deemed to have waived
any Trust Enforcement Event and all Trust Enforcement Events with respect to the
Common Securities and the consequences thereof until all Trust Enforcement
Events with respect to the Capital Securities have been cured, waived or
otherwise eliminated, and until such Trust Enforcement Events with respect to
the Capital Securities have been so cured, waived or otherwise eliminated, the
Property Trustee will be deemed to be acting solely on behalf of the Holders of
the Capital Securities and only the Holders of the Capital Securities will have
the right to direct the Property Trustee in accordance with the terms of the
Securities. The foregoing provisions of this Section 2.6(c) shall be in lieu of
Sections 316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act and such
Sections 316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act are hereby
expressly excluded from this Declaration and the Securities, as permitted by the
Trust Indenture Act. Subject to the foregoing provisions of this Section 2.6(c),
upon such waiver, any such default shall cease to exist and any Trust
Enforcement Event with respect to the Common Securities arising therefrom shall
be deemed to have been cured for every purpose of this Declaration, but no such
waiver shall extend to any subsequent or other Trust Enforcement Event with
respect to the Common Securities or impair any right consequent thereon.
(d) A waiver of an Indenture Event of Default by the Property Trustee
at the direction of the Holders of the Capital Securities constitutes a waiver
of the corresponding Trust Enforcement Event with respect to the Capital
Securities under this Declaration. The foregoing provisions of this Section
2.6(d) shall be in lieu of Section 316(a)(1)(B) of the Trust Indenture Act and
such Section 316(a)(1)(B) of the Trust Indenture Act is hereby expressly
excluded from this Declaration and the Securities, as permitted by the Trust
Indenture Act.
<PAGE> 16
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Section 2.7 Trust Enforcement Event; Notice.
(a) The Property Trustee shall, within 90 days after the occurrence of
a Trust Enforcement Event, transmit by mail, first class postage prepaid, to the
Holders of the Securities, notices of all defaults with respect to the
Securities actually known to a Responsible Officer of the Property Trustee,
unless such defaults have been cured before the giving of such notice (the term
"defaults" for the purposes of this Section 2.7(a) being hereby defined to be an
Indenture Event of Default, not including any periods of grace provided for
therein and irrespective of the giving of any notice provided therein); provided
that, except for a default in the payment of principal of (or premium, if any)
or interest on any of the Debentures, the Property Trustee shall be fully
protected in withholding such notice if and so long as a Responsible Officer of
the Property Trustee in good faith determines that the withholding of such
notice is in the interests of the Holders of the Securities.
(b) The Property Trustee shall not be deemed to have knowledge of any
default except:
(i) a default under Sections 501(1) and 501(2) of the Indenture; or
(ii) any default as to which the Property Trustee shall have received
written notice or of which a Responsible Officer of the Property
Trustee charged with the administration of this Declaration shall
have actual knowledge.
ARTICLE 3
ORGANIZATION
Section 3.1 Name and Organization.
The Trust hereby continued is named "Huntington Capital I" as such name
may be modified from time to time by the Regular Trustees following written
notice to the Holders of Securities. The Trust's activities may be conducted
under the name of the Trust or any other name deemed advisable by the Regular
Trustees.
Section 3.2 Office.
The address of the principal executive office of the Trust is c/o
Huntington Bancshares Incorporated, Huntington Center, 41 South High Street,
Columbus, Ohio 43287, Attn: Judith D. Fisher. On 10 Business Days' written
notice to the Holders of Securities, the Regular Trustees may designate another
principal office.
<PAGE> 17
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Section 3.3 Purpose.
The exclusive purposes and functions of the Trust are (a) to issue and
sell the Securities and use the gross proceeds from such sale to acquire the
Debentures, and (b) except as otherwise limited herein, to engage in only those
other activities necessary or incidental thereto. The Trust shall not borrow
money, issue debt or reinvest proceeds derived from investments, mortgage,
pledge any of its assets or otherwise undertake (or permit to be undertaken) any
activity that would cause the Trust not to be classified as a grantor trust for
United States federal income tax purposes.
By the acceptance of this Trust, none of the Trustees, the Sponsor, the
Holders of the Capital Securities or Common Securities or the Capital Security
Beneficial Owners will take any position which is contrary to the classification
of the Trust as a grantor trust for United States federal income tax purposes.
Section 3.4 Authority.
Subject to the limitations provided in this Declaration and to the
specific duties of the Property Trustee, the Regular Trustees shall have
exclusive authority to carry out the purposes of the Trust. An action taken by
the Regular Trustees in accordance with their powers shall constitute the act of
and serve to bind the Trust and an action taken by the Property Trustee on
behalf of the Trust in accordance with its powers shall constitute the act of
and serve to bind the Trust. In dealing with the Trustees acting on behalf of
the Trust, no person shall be required to inquire into the authority of the
Trustees to bind the Trust. Persons dealing with the Trust are entitled to rely
conclusively on the power and authority of the Trustees as set forth in this
Declaration.
(a) Except as expressly set forth in this Declaration and except if a
meeting of the Regular Trustees is called with respect to any matter over which
the Regular Trustees have power to act, any power of the Regular Trustees may be
exercised by, or with the consent of, any one such Regular Trustee.
(b) Unless otherwise determined by the Regular Trustees, and except as
otherwise required by the Business Trust Act or applicable law, any Regular
Trustee is authorized to execute on behalf of the Trust any documents which the
Regular Trustees have the power and authority to cause the Trust to execute
pursuant to Section 3.6(b); and
(c) A Regular Trustee may, by power of attorney consistent with
applicable law, delegate to any other natural person over the age of 21 his or
her power for the purposes of signing any documents which the Regular Trustees
have power and authority to cause the Trust to execute pursuant to Section 3.6.
<PAGE> 18
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Section 3.5 Title to Property of the Trust.
Except as provided in Section 3.8 with respect to the Debentures and
the Property Account or as otherwise provided in this Declaration, legal title
to all assets of the Trust shall be vested in the Trust. The Holders shall not
have legal title to any part of the assets of the Trust, but shall have an
undivided beneficial ownership interest in the assets of the Trust.
Section 3.6 Powers and Duties of the Regular Trustees.
The Regular Trustees shall have the power, duty and authority to cause
the Trust to engage in the following activities, subject to the limitations and
restrictions of applicable laws:
(a) to establish the terms and form of the Capital Securities and the
Common Securities in the manner specified in Section 7.1 and issue and sell the
Capital Securities and the Common Securities in accordance with this
Declaration; provided, that there shall be no interests in the Trust other than
the Securities, and no more than one series of Common Securities and one series
of Capital Securities;
(b) in connection with the issue and sale of the Capital Securities, at
the direction of the Sponsor, to:
(i) if deemed necessary or desirable by the Sponsor, execute and file
an application, prepared by the Sponsor, to the Luxembourg Stock
Exchange or other foreign national stock exchange for listing of
any Capital Securities, the Guarantee and the Debentures;
(ii) execute and file any documents prepared by the Sponsor, or take
any acts as determined by the Sponsor to be necessary, in order to
qualify or register all or part of the Capital Securities in any
State in which the Sponsor has determined to qualify or register
such Capital Securities for sale;
(iii) execute and file an application, prepared by the Sponsor, to the
Private Offerings, Resales and Trading through Automated Linkages
("PORTAL") Market and if and at such time determined by the
Sponsor, to The New York Stock Exchange, Inc. or any other
national stock exchange or the Nasdaq Stock Market's National
Market for listing upon notice of issuance of any Capital
Securities;
(iv) execute and deliver letters or documents to, or instruments with,
DTC relating to the Capital Securities;
(v) execute and enter into a purchase agreement and other related
agreements providing for the sale of the Capital Securities to the
Initial Purchasers; and
<PAGE> 19
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(vi) execute and enter into the Registration Rights Agreement.
(c) to acquire the Debentures with the proceeds of the sale of the
Capital Securities and the Common Securities; provided, however, that the
Regular Trustees shall cause legal title to the Debentures to be held of record
in the name of the Property Trustee for the benefit of the Holders of the
Capital Securities and the Holders of the Common Securities;
(d) to give the Sponsor and the Property Trustee prompt written notice
of the occurrence of a Special Event; provided that the Regular Trustees shall
consult with the Sponsor and the Property Trustee before taking or refraining
from taking any action in relation to any such Special Event;
(e) to establish a record date with respect to all actions to be taken
hereunder that require a record date be established, including and with respect
to, for the purposes of Section 316(c) of the Trust Indenture Act,
Distributions, voting rights, redemptions and exchanges, and to issue relevant
notices to the Holders of Capital Securities and Holders of Common Securities as
to such actions and applicable record dates;
(f) to take all actions and perform such duties as may be required of
the Regular Trustees pursuant to the terms of this Declaration and the
Securities;
(g) to bring or defend, pay, collect, compromise, arbitrate, resort to
legal action or otherwise adjust claims or demands of or against the Trust
("Legal Action"), unless pursuant to Section 3.8(e), the Property Trustee has
the exclusive power to bring such Legal Action;
(h) to employ or otherwise engage employees and agents (who may be
designated as officers with titles) and managers, contractors, advisors and
consultants to conduct only those services that the Regular Trustees have
authority to conduct directly, and to and pay reasonable compensation for such
services;
(i) to incur expenses that are necessary or incidental to carry out any
of the purposes of the Trust;
(j) to act as, or appoint another Person to act as, registrar, paying
agent and transfer agent for the Securities; provided, however, that at all
times and for so long as the Capital Securities are listed on the Luxembourg
Stock Exchange, and the Luxembourg Stock Exchange so requires, there shall be a
transfer agent and paying agent for the Securities in Luxembourg (the
"Luxembourg Transfer and Paying Agent");
(k) to give prompt written notice to the Holders of the Securities of
any notice received from the Debenture Issuer of its election to defer payments
of interest on the Debentures by extending the interest payment period under the
Debentures as authorized by the Indenture;
<PAGE> 20
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(l) to take all action that may be necessary or appropriate for the
preservation and the continuation of the Trust's valid existence, rights,
franchises and privileges as a statutory business trust under the laws of the
State of Delaware and of each other jurisdiction in which such existence is
necessary to protect the limited liability of the Holders of the Capital
Securities or to enable the Trust to effect the purposes for which the Trust was
created;
(m) to take any action, not inconsistent with applicable law, that the
Regular Trustees determine in their discretion to be necessary or desirable in
carrying out the purposes and functions of the Trust as set out in Section 3.3
or the activities of the Trust as set out in this Section 3.6, including, but
not limited to:
(i) causing the Trust not to be deemed to be an Investment Company
required to be registered under the Investment Company Act;
(ii) causing the Trust to be classified as a grantor trust for United
States federal income tax purposes; and
(iii) cooperating with the Debenture Issuer to ensure that the
Debentures will be treated as indebtedness of the Debenture Issuer
for United States federal income tax purposes.
(n) to take all action necessary to cause all applicable tax returns
and tax information reports that are required to be filed with respect to the
Trust to be duly prepared and filed by the Regular Trustees, on behalf of the
Trust;
(o) to execute all documents or instruments, perform all duties and
powers, and do all things for and on behalf of the Trust in all matters
necessary or incidental to the foregoing; and
No provision of this Declaration shall be construed to relieve a
Regular Trustee from liability for his own negligent action, his own negligent
failure to act, or his own willful misconduct, except that:
(i) prior to the occurrence of a Trust Enforcement Event and after the
curing or waiving of such Trust Enforcement Event that may have
occurred:
(A) the duties and obligations of the Regular Trustees shall be
determined solely by the express provisions of this
Declaration and the Regular Trustee shall not be liable
except for the performance of such duties and obligations as
are specifically set forth in this Declaration, and no
implied covenants or obligations shall be read into this
Declaration against the Regular Trustees; and
(B) in the absence of bad faith on the part of a Regular Trustee,
such Regular Trustee may conclusively rely, as to the truth
of the statements and the correctness of the opinions
expressed therein, upon
<PAGE> 21
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any certificates or opinions furnished to such Regular
Trustee and conforming to the requirements of this
Declaration; but in the case of any such certificates or
opinions that by any provision hereof are specifically
required to be furnished to such Regular Trustee, such
Regular Trustee shall be under a duty to examine the same to
determine whether or not they substantially conform to the
requirements of this Declaration;
(ii) a Regular Trustee shall not be liable for any error of judgment
made in good faith unless it shall be proved that such Regular
Trustee was negligent in ascertaining the pertinent facts;
(iii) no provision of this Declaration shall require a Regular Trustee
to expend or risk his own funds or otherwise incur personal
financial liability in the performance of any of his duties or in
the exercise of any of his rights or powers, if he shall have
reasonable grounds for believing that the repayment of such funds
or liability is not reasonably assured to him under the terms of
this Declaration or indemnity reasonably satisfactory to such
Regular Trustee against such risk or liability is not reasonably
assured to him;
(iv) a Regular Trustee shall not be responsible for monitoring the
compliance by the Property Trustee or the Sponsor with their
respective duties under this Declaration, nor shall such Regular
Trustee be liable for any default or misconduct of the Property
Trustee or the Sponsor;
(v) a Regular Trustee may conclusively rely and shall be fully
protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document believed by
him to be genuine and to have been signed, sent or presented by
the proper party or parties;
(vi) a Regular Trustee shall have no duty to see to any recording,
filing or registration of any instrument (including any financing
or continuation statement or any filing under tax or securities
laws) or any rerecording, refiling or registration thereof;
(vii) the Regular Trustees may consult with counsel or other experts of
their selection and the advice or opinion of such counsel and
experts with respect to legal matters or advice within the scope
of such experts' area of expertise shall be full and complete
authorization and protection in respect of any action taken,
suffered or omitted by them hereunder in good faith and in
accordance with such advice or opinion, such counsel may be
counsel to the Sponsor or any of its Affiliates, and may include
any of its employees. The Regular Trustees shall have the right at
any time to seek instructions concerning the administration of
this Declaration from any court of
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competent jurisdiction;
(viii) the Regular Trustees shall be under no obligation to exercise any
of the rights or powers vested in them by this Declaration at the
request or direction of any Holder, unless such Holder shall have
provided to the Regular Trustees security and indemnity,
reasonably satisfactory to the Regular Trustees, against the
costs, expenses (including attorneys' fees and expenses) and
liabilities that might be incurred by them in complying with such
request or direction, including such reasonable advances as may be
requested by them;
(ix) a Regular Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence
of indebtedness or other paper or document, but he, in his
discretion, may make such further inquiry or investigation into
such facts or matters as he may see fit;
(x) a Regular Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents, custodians, nominees or attorneys and such Regular
Trustee shall not be responsible for any misconduct or negligence
on the part of any agent or attorney appointed with due care by
him hereunder;
(xi) any action taken by a Regular Trustee or his agents hereunder
shall bind the Trust and the Holders of the Securities, and the
signature of such Regular Trustee or his agents alone shall be
sufficient and effective to perform any such action and no third
party shall be required to inquire as to the authority of such
Regular Trustee to so act or as to his compliance with any of the
terms and provisions of this Declaration, both of which shall be
conclusively evidenced by such Regular Trustee's or his agent's
taking such action;
(xii) except as otherwise expressly provided by this Declaration, a
Regular Trustee shall not be under any obligation to take any
action that is discretionary under the provisions of this
Declaration; and
(xiii) a Regular Trustee shall not be liable for any action taken,
suffered, or omitted to be taken by it in good faith and
reasonably believed by it to be authorized or within the
discretion or rights or powers conferred upon it by this
Declaration.
The Regular Trustees shall exercise the powers set forth in this
Section 3.6 in a manner that is consistent with the purposes and functions of
the Trust set out in Section 3.3 and subject to the limitations and restrictions
of applicable law, and the Regular Trustees shall have no power to, and shall
not, take any action that is inconsistent with the purposes and
<PAGE> 23
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functions of the Trust set forth in Section 3.3 or that is inconsistent with or
in contravention of any applicable law.
Subject to this Section 3.6, the Regular Trustees shall have none of
the powers or the authority of the Property Trustee set forth in Section 3.8.
Any expenses incurred by the Regular Trustees pursuant to this Section
3.6 shall be reimbursed by the Debenture Issuer.
Section 3.7 Prohibition of Actions by the Trust and the Trustees.
(a) The Trust shall not, and the Trustees (including the Property
Trustee) shall cause the Trust not to, engage in any activity other than as
required or authorized by this Declaration. In particular, the Trust shall not
and the Trustees (including the Property Trustee) shall cause the Trust not to:
(i) invest any proceeds received by the Trust from holding the
Debentures, but shall distribute all such proceeds to Holders of
Securities pursuant to the terms of this Declaration and of the
Securities;
(ii) acquire any assets other than the Debentures (and any interest or
proceeds received thereon) and the Guarantee (and the proceeds
received thereon or with respect thereto);
(iii) possess Trust property for other than a Trust purpose;
(iv) make any loans or incur any indebtedness;
(v) possess any power or otherwise act in such a way as to vary the
Trust assets;
(vi) possess any power or otherwise act in such a way as to vary the
terms of the Securities in any way whatsoever (except to the
extent expressly authorized in this Declaration or by the terms of
the Securities);
(vii) issue any securities or other evidences of beneficial ownership
of, or beneficial interest in, the Trust other than the
Securities; or
(viii) other than as provided in this Declaration or by the terms of
the Securities, (A) direct the time, method and place of
exercising any trust or power conferred upon the Debenture Trustee
with respect to the Debentures, (B) waive any past default that is
waivable under the Indenture, (C) exercise any right to rescind or
annul any declaration that the principal of all the Debentures
shall be due and payable, or (D) consent to any amendment,
modification or termination of the Indenture or the Debentures
where such consent shall be required unless, in each case, the
Trust shall have received (A) the prior approval of the Majority
in Liquidation Amount of the Capital
<PAGE> 24
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Securities; provided, however, that where a consent or action
under the Indenture would require the consent or act of the
holders of more than a majority of the aggregate liquidation
amount of Debentures affected thereby, only the Holders of the
percentage of the aggregate stated liquidation amount of the
Capital Securities which is at least equal to the percentage
required under the Indenture may direct the Property Trustee to
give such consent to take such action and (B) an opinion of
counsel to the effect that such modification will not cause more
than an insubstantial risk that the Trust will be deemed an
Investment Company required to be registered under the Investment
Company Act, or the Trust will not be classified as a grantor
trust for United States federal income tax purposes; or
(ix) take any action inconsistent with the status of the Trust as a
grantor trust for United States federal income tax purposes; or
(x) revoke any action previously authorized or approved by a vote of
the Holders of the Capital Securities except pursuant to a
subsequent vote of the Holders of the Capital Securities.
Section 3.8 Powers and Duties of the Property Trustee.
(a) The legal title to the Debentures shall be owned by and held of
record in the name of the Property Trustee in trust for the benefit of the Trust
and the Holders of the Securities. The right, title and interest of the Property
Trustee to the Debentures shall vest automatically in each Person who may
hereafter be appointed as Property Trustee in accordance with Section 6.6. Such
vesting and cessation of title shall be effective whether or not conveyancing
documents with regard to the Debentures have been executed and delivered.
(b) The Property Trustee shall not transfer its right, title and
interest in the Debentures to the Regular Trustees or to the Delaware Trustee
(if the Property Trustee does not also act as Delaware Trustee).
(c) The Property Trustee shall:
(i) establish and maintain a segregated non-interest bearing trust
account (the "Property Account") in the name of and under the
exclusive control of the Property Trustee on behalf of the Holders
of the Securities and, upon the receipt of payments of funds made
in respect of the Debentures held by the Property Trustee, deposit
such funds into the Property Account and make payments to the
Holders of the Capital Securities and Holders of the Common
Securities from the Property Account in accordance with Section
7.2. Funds in the Property Account shall be held uninvested until
disbursed in accordance with this Declaration. The Property
Account shall be an account that is maintained with a banking
institution the rating on whose long-term unsecured indebtedness
is at least equal to the rating assigned to the Capital Securities
by a "nationally recognized statistical rating
<PAGE> 25
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organization", as that term is defined for purposes of Rule
436(g)(2) under the Securities Act;
(ii) engage in such ministerial activities as shall be necessary or
appropriate to effect the redemption of the Capital Securities and
the Common Securities to the extent the Debentures are redeemed or
mature; and
(iii) upon written notice of distribution issued by the Regular
Trustees in accordance with the terms of the Securities, engage in
such ministerial activities as so directed and as shall be
necessary or appropriate to effect the distribution of the
Debentures to Holders of Securities upon the occurrence of a
Special Event.
(d) The Property Trustee shall take all actions and perform such duties
as may be specifically required of the Property Trustee pursuant to the terms of
this Declaration and the Securities.
(e) The Property Trustee shall take any Legal Action which arises out
of or in connection with a Trust Enforcement Event of which a Responsible
Officer of the Property Trustee has actual knowledge or the Property Trustee's
duties and obligations under this Declaration or the Trust Indenture Act;
provided, however, that if a Trust Enforcement Event has occurred and is
continuing and such event is attributable to the failure of the Debenture Issuer
to pay interest or principal (or premium, if any) on the Debentures on the date
such interest or principal (or premium, if any) is otherwise payable (or in the
case of redemption, on the redemption date), then a Holder of Capital Securities
may directly institute a proceeding for enforcement of payment to such Holder of
the principal of (or premium, if any) or interest on the Debentures having a
principal amount equal to the aggregate liquidation amount of the Capital
Security of such Holder (a "Direct Action"), on or after the respective due date
specified in the Debentures. In connection with such Direct Action, the rights
of the Holders of the Common Securities will be subrogated to the rights of such
Holder of Capital Securities to the extent of any payment made by the Debenture
Issuer to such Holder of Capital Securities in such Direct Action; provided,
however, that no Holder of the Common Securities may exercise any such right of
subrogation so long as an Trust Enforcement Event with respect to the Capital
Securities has occurred and is continuing. Except as provided in the preceding
sentences, the Holders of Capital Securities will not be able to exercise
directly any other remedy available to the Holders of the Debentures.
(f) The Property Trustee shall continue to serve as a Trustee until
either:
(i) the Trust has been completely liquidated and the proceeds of the
liquidation distributed to the Holders of Securities pursuant to
the terms of the Securities;
(ii) a Successor Property Trustee has been appointed and has accepted
that appointment in accordance with Section 6.6; or
<PAGE> 26
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(iii) the Property Trustee has resigned in accordance with Section 6.6.
(g) Subject to such limitations as are necessary to insure compliance
with Section 3.3, the Property Trustee shall have the legal power to exercise
all of the rights, powers and privileges of a holder of Debentures under the
Indenture and, if a Trust Enforcement Event actually known to a Responsible
Officer of the Property Trustee occurs and is continuing, the Property Trustee
shall, for the benefit of Holders of the Securities, enforce its rights as
holder of the Debentures subject to the rights of the Holders pursuant to the
terms of such Securities.
(h) The Property Trustee may authorize one or more Persons (each, a
"Paying Agent") to pay Distributions, redemption payments or liquidation
payments on behalf of the Trust with respect to all Securities and any such
Paying Agent shall comply with Section 317(b) of the Trust Indenture Act;
provided, however, that at all times and so long as the Capital Securities are
listed on the Luxembourg Stock Exchange, and the Luxembourg Stock Exchange so
requires, the Property Trustee will authorize a Paying Agent in Luxembourg to
act as a Paying Agent and who will also cause the rate of Distributions, amount
of Distributions, the payment dates for each Distribution and the Extension
Period, if any, or any other information required by the Luxembourg Stock
Exchange, to be provided to the Luxembourg Stock Exchange and published in a
leading newspaper having general circulation in Luxembourg (which is expected to
be the Luxembourg Wort) as soon as possible after the determination thereof. Any
Paying Agent may be removed by the Property Trustee at any time and a successor
Paying Agent or additional Paying Agents may be appointed at any time by the
Property Trustee. In the event the Capital Securities do not remain in the form
of one or more Global Securities, the Property Trustee and, at all times and so
long as the Capital Securities are listed on the Luxembourg Stock Exchange and
such exchange so requires, an entity designated as the Luxembourg Transfer and
Paying Agent, will act as Paying Agents. The Property Trustee may designate
additional or substitute Paying Agents at any time, subject to the requirements
of the Luxembourg Stock Exchange.
(i) Subject to this Section 3.8, the Property Trustee shall have none
of the duties, liabilities, powers or the authority of the Regular Trustees set
forth in Section 3.6.
The Property Trustee shall exercise the powers set forth in this
Section 3.8 in a manner that is consistent with the purposes and functions of
the Trust set out in Section 3.3 and subject to the limitations and restrictions
of applicable law, and the Property Trustee shall have no power to, and shall
not, take any action that is inconsistent with the purposes and functions of the
Trust set out in Section 3.3.
Section 3.9 Certain Duties and Responsibilities of the Property
Trustee.
(a) The Property Trustee, before the occurrence of any Trust
Enforcement Event and after the curing of all Trust Enforcement Events that may
have occurred, shall undertake to perform only such duties as are specifically
set forth in this Declaration and no implied covenants shall be read into this
Declaration against the Property Trustee. In case a Trust Enforcement Event has
occurred (that has not been cured or waived pursuant to Section
<PAGE> 27
24
2.6) of which a Responsible Officer of the Property Trustee has actual
knowledge, the Property Trustee shall exercise such of the rights and powers
vested in it by this Declaration, and use the same degree of care and skill in
their exercise, as a prudent person would exercise or use under the
circumstances in the conduct of his or her own affairs.
(b) No provision of this Declaration shall be construed to relieve the
Property Trustee from liability for its own negligent action, its own negligent
failure to act or its own willful misconduct, except that:
(i) prior to the occurrence of a Trust Enforcement Event and after the
curing or waiving of all such Trust Enforcement Events that may
have occurred:
a. the duties and obligations of the Property Trustee shall be
determined solely by the express provisions of this
Declaration and the Property Trustee shall not be liable
except for the performance of such duties and obligations as
are specifically set forth in this Declaration, and no
implied covenants or obligations shall be read into this
Declaration against the Property Trustee; and
b. in the absence of bad faith on the part of the Property
Trustee, the Property Trustee may conclusively rely, as to
the truth of the statements and the correctness of the
opinions expressed therein, upon any certificates or opinions
furnished to the Property Trustee and conforming to the
requirements of this Declaration; but in the case of any such
certificates or opinions that by any provision hereof are
specifically required to be furnished to the Property
Trustee, the Property Trustee shall be under a duty to
examine the same to determine whether or not they
substantially conform to the requirements of this
Declaration;
(ii) the Property Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer of the Property
Trustee, unless it shall be proved that the Property Trustee was
negligent in ascertaining the pertinent facts;
(iii) the Property Trustee shall not be liable with respect to any
action taken or omitted to be taken by it without negligence, in
good faith in accordance with the direction of the Holders of not
less than a Majority in Liquidation Amount of the Securities
relating to the time, method and place of conducting any
proceeding for any remedy available to the Property Trustee, or
exercising any trust or power conferred upon the Property Trustee
under this Declaration;
(iv) no provision of this Declaration shall require the Property
Trustee to expend or risk its own funds or otherwise incur
personal financial liability in the performance of any of its
duties or in the exercise of any of its rights or
<PAGE> 28
25
powers, if it shall have reasonable grounds for believing that the
repayment of such funds or liability is not reasonably assured to
it under the terms of this Declaration or indemnity reasonably
satisfactory to the Property Trustee against such risk or
liability is not reasonably assured to it;
(v) the Property Trustee's sole duty with respect to the custody,
safe-keeping and physical preservation of the Debentures and the
Property Account shall be to deal with such property in a similar
manner as the Property Trustee deals with similar property for its
own account, subject to the protections and limitations on
liability afforded to the Property Trustee under this Declaration
and the Trust Indenture Act;
(vi) the Property Trustee shall have no duty or liability for or with
respect to the value, genuineness, existence or sufficiency of the
Debentures or the payment of any taxes or assessments levied
thereon or in connection therewith;
(vii) the Property Trustee shall not be liable for any interest on any
money received by it except as it may otherwise agree with the
Sponsor in writing. Money held by the Property Trustee need not be
segregated from other funds held by it except in relation to the
Property Account maintained by the Property Trustee pursuant to
Section 3.8(c)(i) and except to the extent otherwise required by
law;
(viii) the Property Trustee shall not be responsible for monitoring the
compliance by the Regular Trustees or the Sponsor with their
respective duties under this Declaration, nor shall the Property
Trustee be liable for any default or misconduct of the Regular
Trustees or the Sponsor; and
(ix) The Trustee shall be under no liability for interest on any money
received by it hereunder except as otherwise agreed in writing
with the Debenture Issuer.
Section 3.10 Certain Rights of Property Trustee.
(a) Subject to the provisions of Section 3.9:
(i) the Property Trustee may conclusively rely and shall be fully
protected in acting or refraining from acting upon any resolution,
certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document believed by it
to be genuine and to have been signed, sent or presented by the
proper party or parties;
(ii) any direction or act of the Sponsor or the Regular Trustees
contemplated by this Declaration shall be sufficiently evidenced
by an Officers' Certificate
<PAGE> 29
26
(or, with respect to the establishment of the terms and form of
the Securities by the Regular Trustees, by a Trustees'
Authorization Certificate);
(iii) whenever in the administration of this Declaration, the Property
Trustee shall deem it desirable that a matter be proved or
established before taking, suffering or omitting any action
hereunder, the Property Trustee (unless other evidence is herein
specifically prescribed) may, in the absence of bad faith on its
part, request and conclusively rely upon an Officers' Certificate
which, upon receipt of such request, shall be promptly delivered
by the Sponsor or the Regular Trustees;
(iv) the Property Trustee shall have no duty to see to any recording,
filing or registration of any instrument (including any financing
or continuation statement or any filing under tax or securities
laws) or any rerecording, refiling or registration thereof;
(v) the Property Trustee may consult with counsel of its choice or
other experts and the advice or opinion of such counsel and
experts with respect to legal matters or advice within the scope
of such experts' area of expertise shall be full and complete
authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in
accordance with such advice or opinion, such counsel may be
counsel to the Sponsor or any of its Affiliates, and may include
any of its employees. The Property Trustee shall have the right at
any time to seek instructions concerning the administration of
this Declaration from any court of competent jurisdiction;
(vi) the Property Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Declaration at the
request or direction of any Holder, unless such Holder shall have
provided to the Property Trustee security and indemnity,
reasonably satisfactory to the Property Trustee, against the
costs, expenses (including attorneys' fees and expenses and the
expenses of the Property Trustee's agents, nominees or custodians)
and liabilities that might be incurred by it in complying with
such request or direction, including such reasonable advances as
may be requested by the Property Trustee; provided that, nothing
contained in this Section 3.10(a) shall be taken to relieve the
Property Trustee, upon the occurrence of an Indenture Event of
Default, of its obligation to exercise the rights and powers
vested in it by this Declaration;
(vii) the Property Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence
of indebtedness or other paper or document, but the Property
Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit;
<PAGE> 30
27
(viii) the Property Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents, custodians, nominees or attorneys and the Property
Trustee shall not be responsible for any misconduct or negligence
on the part of any agent or attorney appointed with due care by it
hereunder;
(ix) any action taken by the Property Trustee or its agents hereunder
shall bind the Trust and the Holders of the Securities, and the
signature of the Property Trustee or its agents alone shall be
sufficient and effective to perform any such action and no third
party shall be required to inquire as to the authority of the
Property Trustee to so act or as to its compliance with any of the
terms and provisions of this Declaration, both of which shall be
conclusively evidenced by the Property Trustee's or its agent's
taking such action;
(x) whenever in the administration of this Declaration the Property
Trustee shall deem it desirable to receive instructions with
respect to enforcing any remedy or right or taking any other
action hereunder, the Property Trustee (i) may request
instructions from the Holders of the Securities, the Regular
Trustees or the Sponsor which instructions may only be given by
the Holders of the same proportion in liquidation amount of the
Securities as would be entitled to direct the Property Trustee
under the terms of the Securities in respect of such remedy, right
or action, (ii) may refrain from enforcing such remedy or right or
taking such other action until such instructions are received, and
(iii) shall be protected in conclusively relying on or acting in
accordance with such instructions;
(xi) if no Trust Enforcement Event has occurred and is continuing and
the Property Trustee is required to decide between alternative
causes of action, construe ambiguous provisions in their
Declaration or is unsure of the application of any provision of
their Declaration, and the matter is not one on which Holders of
Capital Securities are entitled under the Declaration to vote,
then the Property Trustee may, but shall be under no duty to, take
such action as is directed by the Sponsor and will have no
liability except for its own bad faith, negligence or willful
misconduct;
(xii) except as otherwise expressly provided by this Declaration, the
Property Trustee shall not be under any obligation to take any
action that is discretionary under the provisions of this
Declaration;
(xiii) the Property Trustee shall not be liable for any action taken,
suffered or omitted to be taken by it without negligence, in good
faith and reasonably believed by it to be authorized or within the
discretion, rights or powers conferred upon it by this
Declaration; and
(xiv) the Trustee shall have a lien prior to the Securities as to all
property and funds held by it hereunder for any amount owing it or
any predecessor
<PAGE> 31
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Trustee, except with respect to funds held in trust for the
benefit of the Holders of particular Securities.
(b) No provision of this Declaration shall be deemed to impose any duty
or obligation on the Property Trustee to perform any act or acts or exercise any
right, power, duty or obligation conferred or imposed on it, in any jurisdiction
in which it shall be illegal, or in which the Property Trustee shall be
unqualified or incompetent in accordance with applicable law, to perform any
such act or acts, or to exercise any such right, power, duty or obligation. No
permissive power or authority available to the Property Trustee shall be
construed to be a duty.
Section 3.11 Delaware Trustee.
Notwithstanding any other provision of this Declaration other than
Section 6.2, the Delaware Trustee shall not be entitled to exercise any powers,
nor shall the Delaware Trustee have any of the duties and responsibilities of
the Regular Trustees or the Property Trustee described in this Declaration.
Except as set forth in Section 6.2, the Delaware Trustee shall be a Trustee for
the sole and limited purpose of fulfilling the requirements of Section 3807 of
the Business Trust Act.
Section 3.12 Execution of Documents.
Unless otherwise determined by the Regular Trustees, and except as
otherwise required by the Business Trust Act, any Regular Trustee is authorized
to execute on behalf of the Trust any documents that the Regular Trustees have
the power and authority to execute pursuant to Section 3.6.
Section 3.13 Not Responsible for Recitals or Issuance of Securities.
The recitals contained in this Declaration and the Securities shall be
taken as the statements of the Sponsor, and the Trustees do not assume any
responsibility for their correctness. The Trustees make no representations as to
the value or condition of the property of the Trust or any part thereof. The
Trustees make no representations as to the validity or sufficiency of this
Declaration, the Securities, the Debentures or the Indenture.
Section 3.14 Duration of Trust.
The Trust shall exist until terminated pursuant to the provisions of
Article 8 hereof.
Section 3.15 Mergers.
(a) The Trust may not consolidate, amalgamate, merge with or into, or
be replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other body, except as
described in Section 3.15(b) and (c).
<PAGE> 32
29
(b) The Trust may, at the request of the Sponsor, with the consent of
Holders of at least a Majority in Liquidation Amount of the Capital Securities,
consolidate, amalgamate, merge with or into, or be replaced by or convey,
transfer or lease its properties substantially as an entirety to a trust
organized as such under the laws of any State; provided that:
(i) if the Trust is not the successor, such successor entity (the
"Successor Entity") either:
a. expressly assumes all of the obligations of the Trust under
the Securities; or
b. substitutes for the Capital Securities other securities
having substantially the same terms as the Capital Securities
(the "Successor Securities") so long as the Successor
Securities rank the same as the Capital Securities rank in
priority with respect to Distributions and payments upon
liquidation, redemption and otherwise;
(ii) the Sponsor expressly appoints a trustee of such Successor Entity
that possesses the same powers and duties as the Property Trustee
as the holder of the Debentures;
(iii) the Capital Securities or any Successor Securities are listed, or
any Successor Securities will be listed upon notification of
issuance, on any national securities exchange or with any other
organization on which the Capital Securities are then listed or
quoted, if any;
(iv) such merger, consolidation, amalgamation, replacement, conveyance,
transfer or lease does not cause the Capital Securities (including
any Successor Securities) to be downgraded by any nationally
recognized statistical rating organization;
(v) such merger, consolidation, amalgamation, replacement, conveyance,
transfer or lease does not adversely affect the rights,
preferences and privileges of the Holders of the Capital
Securities (including any Successor Securities) in any material
respect;
(vi) such Successor Entity has a purpose substantially identical to
that of the Trust;
(vii) prior to such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease the Sponsor has received an opinion
of independent counsel to the Trust experienced in such matters to
the effect that:
<PAGE> 33
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a. such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the
rights, preferences and privileges of the Holders of the
Capital Securities (including any Successor Securities) in
any material respect;
b. following such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease neither the Trust
nor the Successor Entity will be required to register as an
Investment Company; and
c. following such merger, consolidation, amalgamation or
replacement, the Trust (or the Successor Entity) will
continue to be classified as a grantor trust for United
States federal income tax purposes;
(viii) the Sponsor or any permitted successor or assignee owns all of
the Common Securities and guarantees the obligations of such
Successor Entity under the Successor Securities at least to the
extent provided by the Guarantee; and
(ix) such Successor Entity expressly assumes all of the obligations of
the Trust with respect to the Trustees.
(c) Notwithstanding Section 3.15(b), the Trust shall not, except with
the consent of Holders of 100% in liquidation amount of the Securities,
consolidate, amalgamate, merge with or into any other entity, or be replaced by
or convey, transfer or lease its properties and assets substantially as an
entirety to any other entity or permit any other entity to consolidate,
amalgamate, merge with or into, or replace it if such consolidation,
amalgamation, merger, replacement, conveyance transfer or lease would cause the
Trust or Successor Entity to be classified as other than a grantor trust for
United States federal income tax purposes and each Holder of the Securities not
to be treated as owning an undivided beneficial ownership interest in the
Debentures.
Section 3.16 Property Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
similar judicial proceeding relative to the Trust or any other obligor upon the
Securities or the property of the Trust or of such other obligor or their
creditors, the Property Trustee (irrespective of whether any Distributions on
the Securities shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Property Trustee shall
have made any demand on the Trust for the payment of any past due Distributions)
shall be entitled and empowered, to the fullest extent permitted by law, by
intervention in such proceeding or otherwise:
(a) to file and prove a claim for the whole amount of any Distributions
owing and unpaid in respect of the Securities (or, if the Securities are
original issue discount Securities, such portion of the liquidation amount as
may be specified in the terms of such Securities) and to file such other papers
or documents as may be necessary or advisable in
<PAGE> 34
31
order to have the claims of the Property Trustee (including any claim for the
reasonable compensation, expenses, disbursements and advances of the Property
Trustee, its agents and counsel) and of the Holders allowed in such judicial
proceeding, and
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Property Trustee and, in the event the
Property Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Property Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Property Trustee, its
agents and counsel, and any other amounts due the Property Trustee.
Nothing herein contained shall be deemed to authorize the Property
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement adjustment or compensation affecting the
Securities or the rights of any Holder thereof or to authorize the Property
Trustee to vote in respect of the claim of any Holder in any such proceeding.
ARTICLE 4
SPONSOR
Section 4.1 Responsibilities of the Sponsor.
In connection with the issue and sale of the Capital Securities, the
Sponsor shall have the exclusive right and responsibility to engage in the
following activities:
(a) to determine the States in which to take appropriate action to
qualify or register for sale all or part of the Capital Securities and to do any
and all such acts, other than actions which must be taken by the Trust, and
advise the Trust of actions it must take, and prepare for execution and filing
any documents to be executed and filed by the Trust, as the Sponsor deems
necessary or advisable in order to comply with the applicable laws of any such
States;
(b) to prepare any filing by the Trust of an application to Luxembourg
Stock Exchange or other foreign national stock exchange for listing, if such
filing is determined to be necessary or desirable by the Sponsor;
(c) to prepare for filing and cause the filing by the Trust, as may be
appropriate, of an application to the PORTAL, The New York Stock Exchange, Inc.
or any other national stock exchange or the Nasdaq National Market for listing
or quotation upon notice of issuance of any Capital Securities;
<PAGE> 35
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(d) to negotiate the terms of and execute and deliver a purchase
agreement and other related agreements providing for the sale of the Capital
Securities to the Initial Purchasers; and
(e) to negotiate the terms of the Registration Rights Agreement.
Section 4.2 Compensation, Indemnification and Expenses of the Trustee.
Pursuant to Sections 607 and 1009 of the Indenture, the Sponsor, in its
capacity as Debenture Issuer, agrees:
(1) to pay to the Trustees from time to time such compensation as the
Debenture Issuer and the Trustees shall from time to time agree in writing
for all services rendered by it hereunder (which compensation shall not be
limited by any provision of law in regard to the compensation of a trustee
of an express trust);
(2) to reimburse the Trustees upon their request for all reasonable
expenses, disbursements and advances incurred or made by the Trustees in
accordance with any provision of the Indenture (including the compensation
and the expenses and disbursements of its agent and counsel), except any
such expense, disbursement or advance as may be attributable to its
negligence or bad faith; and
(3) to indemnify the Property Trustee and the Delaware Trustee and
their respective officers, directors, employees and authorized agents for,
and to hold each of them harmless against, any loss, liability or expense
including taxes (other than taxes based upon, measured by or determined by
the income of any Trustee) incurred without negligence or bad faith on the
part of the Property Trustee, the Delaware Trustee or their respective
officers, directors, employees and authorized agents, as the case may be,
arising out of or in connection with the acceptance or administration of the
trust or trusts hereunder, including the costs and expenses of defending any
of them against any claim or liability in connection with the exercise or
performance of any of their respective powers or duties hereunder; the
provisions of this Section 4.2 shall survive the resignation or removal of
the Delaware Trustee or the Property Trustee or the termination of this
Declaration.
ARTICLE 5
TRUST COMMON SECURITIES HOLDER
Section 5.1 Debenture Issuer's Purchase of Common Securities.
On the Closing Date the Debenture Issuer will purchase all of the
Common Securities issued by the Trust, for an amount at least equal to 3% of the
capital of the Trust, at the same time as the Capital Securities are sold.
<PAGE> 36
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Section 5.2 Covenants of the Common Securities Holder.
For so long as the Capital Securities remain outstanding, the Common
Securities Holder will covenant (i) to maintain directly 100% ownership of the
Common Securities, (ii) to cause the Trust to remain a statutory business trust
and not to voluntarily dissolve, wind up, liquidate or be terminated, except as
permitted by this Declaration, (iii) to use its commercially reasonable efforts
to ensure that the Trust will not be an investment company for purposes of the
Investment Company Act, and (iv) to take no action which would be reasonably
likely to cause the Trust to be classified as an association or a publicly
traded partnership taxable as a corporation for United States federal income tax
purposes.
ARTICLE 6
TRUSTEES
Section 6.1 Number of Trustees.
The number of Trustees initially shall be five (5), and:
(a) at any time before the issuance of any Securities, the Sponsor may,
by written instrument, increase or decrease the number of Trustees; and
(b) after the issuance of any Securities, the number of Trustees may be
increased or decreased by vote of the Holders of a Majority in Liquidation
Amount of the Common Securities voting as a class at a meeting of the Holders of
the Common Securities or by written consent in lieu of such meeting; provided
that (1) the Delaware Trustee, in the case of a natural person, shall be a
person who is a resident of the State of Delaware or that, if not a natural
person, is an entity which has its principal place of business in the State of
Delaware and otherwise meets the requirements of applicable law; (2) at least
one Regular Trustee is an employee or officer of, or is affiliated with, the
Sponsor; and (3) one Trustee shall be the Property Trustee for so long as this
Declaration is required to qualify as an indenture under the Trust Indenture
Act, and such Trustee may also serve as Delaware Trustee if it meets the
applicable requirements.
Section 6.2 Delaware Trustee.
If required by the Business Trust Act, one Trustee (the "Delaware
Trustee") shall be:
(a) a natural person who is a resident of the State of Delaware; or
(b) if not a natural person, an entity which has its principal place of
business in the State of Delaware, and otherwise meets the requirements of
applicable law,
<PAGE> 37
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provided that, if the Property Trustee has its principal place of business in
the State of Delaware and otherwise meets the requirements of applicable law,
then the Property Trustee shall also be the Delaware Trustee and Section 3.11
shall have no application.
Section 6.3 Property Trustee; Eligibility.
(a) There shall at all times be one Trustee which shall act as Property
Trustee which shall:
(i) not be an Affiliate of the Sponsor or any Person involved in the
organization or operation of the Sponsor;
(ii) not offer or provide credit or credit enhancement to the Trust;
and
(iii) be a corporation organized and doing business under the laws of
the United States of America or any State or Territory thereof or
of the District of Columbia, or a corporation or other Person
permitted by the Commission to act as an institutional trustee
under the Trust Indenture Act, authorized under such laws to
exercise corporate trust owners, having a combined capital and
surplus of at least 50 million U.S. dollars ($50,000,000), and
subject to supervision or examination by Federal, State,
Territorial or District of Columbia authority. If such corporation
publishes reports of condition at least annually, pursuant to law
or to the requirements of the supervising or examining authority
referred to above, then for the purposes of this Section
6.3(a)(iii), the combined capital and surplus of such corporation
shall be deemed to be its combined capital and surplus as set
forth in its most recent report of condition so published.
(b) If at any time the Property Trustee shall cease to be eligible to
so act under Section 6.3(a), the Property Trustee shall promptly resign in the
manner and with the effect set forth in Section 6.6(c).
(c) If the Property Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture Act, the
Property Trustee and the Holder of the Common Securities (as if it were the
Obliger referred to in Section 310(b) of the Trust Indenture Act) shall in all
respects comply with the provisions of Section 310(b) of the Trust Indenture
Act.
(d) The Guarantee, the Indenture, the Debentures and the Securities
shall be deemed to be specifically described in this Declaration for purposes of
clause (i) of the first provision contained in Section 310(b) of the Trust
Indenture Act.
<PAGE> 38
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Section 6.4 Qualifications of Regular Trustees and Delaware Trustee
Generally.
Each Regular Trustee and the Delaware Trustee (unless the Property
Trustee also acts as Delaware Trustee) shall be either a natural person who is
at least 21 years of age or a legal entity that shall act through one or more
Authorized Officers.
Section 6.5 Initial Regular Trustees.
The initial Regular Trustees shall be:
Milton D. Baughman, Beth A. Russell and Paul V. Sebert, the business
address of all of whom is c/o Huntington Bancshares Incorporated, Huntington
Center, 41 South High Street, Columbus, Ohio 43287.
Section 6.6 Appointment, Removal and Resignation of Trustees.
(a) Subject to Section 6.6(b), Trustees may be appointed or removed
without cause at any time except, if a Trust Enforcement Event has occurred and
is continuing:
(i) until the issuance of any Securities, by written instrument
executed by the Sponsor; and
(ii) after the issuance of any Securities, by vote of the Holders of a
Majority in Liquidation Amount of the Common Securities voting as
a class at a meeting of the Holders of the Common Securities.
(b) The Trustee that acts as Property Trustee shall not be removed in
accordance with Section 6.6(a) until a successor Trustee possessing the
qualifications to act as Property Trustee under Section 6.3(a) (a "Successor
Property Trustee") has been appointed and has accepted such appointment by
written instrument executed by such Successor Property Trustee and delivered to
the Regular Trustees and the Sponsor. The Trustee that acts as Delaware Trustee
shall not be removed in accordance with Section 6.6(a) until a successor Trustee
possessing the qualifications to act as Delaware Trustee under Sections 6.2 and
6.4 (a "Successor Delaware Trustee") has been appointed and has accepted such
appointment by written instrument executed by such Successor Delaware Trustee
and delivered to the Regular Trustees and the Sponsor.
(c) A Trustee appointed to office shall hold office until his or its
successor shall have been appointed, until his death or its dissolution or until
his or its removal or resignation. Any Trustee may resign from office (without
need for prior or subsequent accounting) by an instrument in writing signed by
the Trustee and delivered to the Sponsor and the Trust, which resignation shall
take effect upon such delivery or upon such later date as is specified therein;
provided, however, that:
<PAGE> 39
36
(i) No such resignation of the Trustee that acts as the Property
Trustee shall be effective:
a. until a Successor Property Trustee has been appointed and has
accepted such appointment by instrument executed by such
Successor Property Trustee and delivered to the Trust, the
Sponsor and the resigning Property Trustee; or
b. until the assets of the Trust have been completely liquidated
and the proceeds thereof distributed to the holders of the
Securities; and
(ii) no such resignation of the Trustee that acts as the Delaware
Trustee shall be effective until a Successor Delaware Trustee has
been appointed and has accepted such appointment by instrument
executed by such Successor Delaware Trustee and delivered to the
Trust, the Sponsor and the resigning Delaware Trustee.
(d) The Holders of the Common Securities shall use their best efforts
to promptly appoint a Successor Delaware Trustee or Successor Property Trustee,
as the case may be, if the Property Trustee or the Delaware Trustee delivers an
instrument of resignation in accordance with this Section 6.6.
(e) If no Successor Property Trustee or Successor Delaware Trustee, as
the case may be, shall have been appointed and accepted appointment as provided
in this Section 6.6 within 30 days after delivery to the Sponsor and the Trust
of an instrument of resignation or removal, the resigning or removed Property
Trustee or Delaware Trustee, as applicable, may petition any court of competent
jurisdiction for appointment of a Successor Property Trustee or Successor
Delaware Trustee, as applicable. Such court may thereupon, after prescribing
such notice, if any, as it may deem proper, appoint a Successor Property Trustee
or Successor Delaware Trustee, as the case may be.
(f) No Property Trustee or Delaware Trustee shall be liable for the
acts or omissions to act of any Successor Property Trustee or Successor Delaware
Trustee, as the case may be.
(g) Upon the resignation or removal of the Property Trustee, such
Property Trustee shall be paid all amounts due and owing.
Section 6.7 Vacancies among Trustees.
If a Trustee ceases to hold office for any reason and the number of
Trustees is not reduced pursuant to Section 6.1, or if the number of Trustees is
increased pursuant to Section 6.1, a vacancy shall occur. The vacancy shall be
filled with a Trustee appointed in accordance with Section 6.6.
Section 6.8 Effect of Vacancies.
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The death, resignation, retirement, removal, bankruptcy, dissolution,
liquidation, incompetence or incapacity to perform the duties of a Trustee shall
not operate to annul the Trust. Whenever a vacancy in the number of Regular
Trustees shall occur, until such vacancy is filled by the appointment of a
Regular Trustee in accordance with Section 6.6, the Regular Trustees in office,
regardless of their number, shall have all the powers granted to the Regular
Trustees and shall discharge all the duties imposed upon the Regular Trustees by
this Declaration.
Section 6.9 Delegation of Power.
(a) Any Regular Trustee may, by power of attorney consistent with
applicable law, delegate to any natural person over the age of 21 his, her or
its power for the purpose of executing any documents contemplated in Section
3.6, including making governmental filings.
(b) The Regular Trustees shall have power to delegate from time to time
to such of their number or to officers of the Trust the doing of such things and
the execution of such instruments either in the name of the Trust or the names
of the Regular Trustees or otherwise as the Regular Trustees may deem expedient,
to the extent such delegation is not prohibited by applicable law or contrary to
the provisions of the Trust, as set forth herein.
Section 6.10 Merger, Conversion, Consolidation or Succession to
Business.
Any corporation into which the Property Trustee, the Delaware Trustee
or a Regular Trustee, if a legal entity, as the case may be, may be merged or
converted or with which either may be consolidated, or any corporation resulting
from an merger, conversion or consolidation to which the Property Trustee, the
Delaware Trustee or a Regular Trustee, if a legal entity, as the case may be,
shall be a party, or any corporation succeeding to all or substantially all the
corporate trust business of the such Trustee shall be the successor of such
Trustee hereunder, provided such corporation shall be otherwise qualified and
eligible under this Article without the execution or filing of any paper or any
further act on the part of any of the parties hereto.
ARTICLE 7
THE SECURITIES
Section 7.1 General Provisions Regarding Securities.
(a) The Regular Trustees shall on behalf of the Trust issue a class of
capital securities representing undivided beneficial ownership interests in the
assets of the Trust (the "Capital Securities"), and a class of common securities
representing undivided beneficial ownership interests in the assets of the Trust
(the "Common Securities"). The aggregate liquidation amount of Capital
Securities and Common Securities that may be issued by the Trust is unlimited;
provided that the Common Securities outstanding at any time must have an
aggregate liquidation amount with respect to the assets of the Trust equal to at
least 3% of the
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assets of the Trust; and provided further that after the initial issuance of
Capital Securities and Common Securities, the Trust may not issue additional
Capital Securities or Common Securities unless the Trustees have received an
opinion of counsel to the effect that the issuance of such securities will not
affect the Trust's status as a grantor trust for United States federal income
tax purposes.
(i) Capital Securities. The Capital Securities of the Trust have a
liquidation amount with respect to the assets of the Trust of
$1,000 per Capital Security. The Capital Security Certificates
evidencing the Capital Securities shall be substantially in the
form of Exhibit A-1 to the Declaration, with such changes and
additions thereto or deletions therefrom as may be required by
ordinary usage, custom or practice.
(ii) Common Securities. The Common Securities of the Trust have a
liquidation amount with respect to the assets of the Trust of
$1,000 per Common Security. The Common Security Certificates
evidencing the Common Securities shall be substantially in the
form of Exhibit A-2 to the Declaration, with such changes and
additions thereto or deletions therefrom as may be required by
ordinary usage, custom or practice.
The Trust shall issue no securities or other interests in the assets of
the Trust other than the Capital Securities and the Common Securities.
(b) Payment of Distributions on, and payments of the Redemption Price
upon a redemption of, the Capital Securities and the Common Securities, as
applicable, shall be made Pro Rata based on the liquidation amount of such
Capital Securities and Common Securities; provided, however, that if on any date
on which amounts payable on Distribution or redemption an Indenture Event of
Default shall have occurred and be continuing, no payment of any Distribution,
or Redemption Price on, any of the Common Securities, and no other payment on
account of the redemption, liquidation or other acquisition of such Common
Securities, shall be made unless payment in full in cash of all accumulated and
unpaid Distributions on all of the outstanding Capital Securities for all
Distribution periods terminating on or prior thereto, or in the case of amounts
payable on redemption the full amount of the Redemption Price for all of the
outstanding Capital Securities then called for redemption, shall have been made
or provided for, and all funds available to the Property Trustee shall first be
applied to the payment in full in cash of all Distributions on, or payments of
the Redemption Price upon a redemption of, the Capital Securities then due and
payable. The Trust shall issue no securities or other interests in the assets of
the Trust other than the Capital Securities and the Common Securities.
(c) The Certificates shall be signed on behalf of the Trust by a
Regular Trustee. Such signature shall be the manual or facsimile signature of
any Regular Trustee. In case a Regular Trustee of the Trust who shall have
signed any of the Certificates shall cease to be such Regular Trustee before the
Certificates so signed shall be delivered by the Trust, such Certificates
nevertheless may be delivered as though the person who signed such Certificates
had not ceased to be such Regular Trustee; and any Certificate may be signed on
behalf of the
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Trust by such persons who, at the actual date of execution of such Certificate,
shall be the Regular Trustees of the Trust, although at the date of the
execution and delivery of the Declaration any such person was not such a Regular
Trustee. Certificates shall be printed, lithographed or engraved or may be
produced in any other manner as is reasonably acceptable to the Regular
Trustees, as evidenced by their execution thereof, and may have such letters,
numbers or other marks of identification or designation and such legends or
endorsements as the Regular Trustees may deem appropriate, or as may be required
to comply with any law or with any rule or regulation of any stock exchange on
which Securities may be listed, or to conform to usage.
A Capital Security Certificate shall not be valid until authenticated
by the manual signature of an authorized officer of the Property Trustee. Such
signature shall be conclusive evidence that the Certificate has been
authenticated under this Declaration.
Upon a written order of the Trust signed by one Regular Trustee, the
Property Trustee shall authenticate the Certificates for original issue.
The Property Trustee may appoint an authenticating agent acceptable to
the Trust to authenticate Certificates. An authenticating agent may authenticate
Certificates whenever the Property Trustee may do so. Each reference in this
Declaration to authentication by the Property Trustee includes authentication by
such agent. An authenticating agent has the same rights as the Property Trustee
to deal with the Sponsor or an Affiliate of the Sponsor.
(d) The consideration received by the Trust for the issuance of the
Securities shall constitute a contribution to the capital of the Trust and shall
not constitute a loan to the Trust.
(e) Upon issuance of the Securities as provided in this Declaration,
the Securities so issued shall be deemed to be validly issued, fully paid and
non-assessable.
(f) Every Person, by virtue of having become a Holder or a Capital
Security Beneficial Owner in accordance with the terms of this Declaration,
shall be deemed to have expressly assented and agreed to the terms of, and shall
be bound by, this Declaration and the terms of the Securities, the Guarantee,
the Indenture and the Debentures.
(g) The Securities shall have no preemptive rights.
Section 7.2 Distributions.
(a) Holders of Securities shall be entitled to receive cumulative cash
Distributions at a variable per annum rate on the stated liquidation amount of
$1,000 per Security equal to the variable per annum rate on the Debentures
calculated on the basis of the actual number of days elapsed in a year
consisting of twelve 30-day months. For any period shorter than a full 90-day
quarterly period, distributions will be computed on the basis of the actual
number of days elapsed in such 90-day quarterly period. Subject to Section
7.1(b), Distributions shall be made on the Capital Securities and the Common
Securities on a Pro Rata
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basis. Distributions on the Securities shall, from the date of original issue,
accrue and be cumulative and shall be payable quarterly only to the extent that
the Trust has funds available for the payment of such Distributions in the
Property Account. Distributions not paid on the scheduled payment date will
accumulate and compound quarterly at the rate payable on the Debentures, to the
extent permitted by applicable law ("Compounded Distributions"). "Distributions"
shall mean ordinary cumulative distributions together with any Compounded
Distributions. If and to the extent that the Debenture Issuer makes a payment of
interest (including Additional Interest (as defined in the Indenture)), premium
and/or principal on the Debentures held by the Property Trustee (the amount of
any such payment being a "Payment Amount"), the Property Trustee shall and is
directed, to the extent funds are available for that purpose, to make a Pro Rata
distribution (a "Distribution") of the Payment Amount to Holders, subject to the
terms of Section 7.1(b).
(b) Distributions on the Securities will be cumulative, will accrue
from the date of initial issuance and will be payable quarterly in arrears on
the last day of January, April, July and October, commencing April 30, 1997,
when, as and if available for payment, by the Property Trustee, except as
otherwise described below. If Distributions are not paid when scheduled, the
accrued Distributions shall be paid to the Holders of record of Securities as
they appear on the books and records of the Trust on the record date as
determined under Section 7.2(c).
(c) Distributions on the Securities will be payable to the Holders
thereof as they appear on the books and records of the Trust on the relevant
record dates, which relevant record date shall be the fifteenth day of the month
of the relevant payment dates. In the event that any date on which distributions
are payable on the Securities is not a Business Day, payment of the distribution
payable on such date will be made on the next succeeding day which is a Business
Day (without any interest or other payment in respect of any such delay), except
that, if such Business Day falls in the next calendar year, such payment will be
made on the immediately preceding Business Day, in each case with the same force
and effect as if made on such date.
Section 7.3 Redemption of Securities; Distribution of Debentures.
(a) Upon the repayment or redemption, in whole or in part, of the
Debentures, the proceeds from such repayment or redemption shall be
simultaneously applied Pro Rata (subject to Section 7.1(b)) to redeem Securities
having an aggregate liquidation amount equal to the aggregate principal amount
of the Debentures so repaid or redeemed for an amount equal to the redemption
price paid by the Debenture Issuer in respect of such Debentures plus an amount
equal to accrued and unpaid Distributions thereon through the date of the
redemption or such lesser amount as shall be received by the Trust in respect of
the Debentures so repaid or redeemed (the "Redemption Price"). Holders will be
given not less than 30 or more than 60 days notice of such redemption.
(b) If, at any time, a Special Event shall occur and be continuing, the
Sponsor may elect to, unless the Debentures are redeemed, within 90 days
following the occurrence of such Special Event cause the dissolution of the
Trust upon not less than 30 nor more than 60
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days' notice and, after satisfaction of creditors, if any, cause the Debentures
to be distributed to the holders of the Common Securities and the Capital
Securities in liquidation of the Trust.
(c) On the date fixed for any distribution of Debentures, upon
dissolution of the Trust, (i) the Capital Securities and the Common Securities
will no longer be deemed to be outstanding and (ii) certificates representing
Securities will be deemed to represent the Debentures having an aggregate
principal amount equal to the stated liquidation amount of, and bearing accrued
and unpaid distributions equal to accrued and unpaid distributions on, such
Securities until such certificates are presented to the Sponsor or its agent for
transfer or reissuance.
Section 7.4 Redemption Procedures.
(a) Notice of any redemption of, or notice of distribution of
Debentures in exchange for, the Securities (a "Redemption/Distribution Notice")
will be given by the Trust by mail, and, if required by the Luxembourg Stock
Exchange, by publication in a leading newspaper having general circulation in
Luxembourg, to each Holder of Securities to be redeemed or exchanged not fewer
than 30 nor more than 60 days before the date fixed for redemption or exchange
thereof which, in the case of a redemption, will be the date fixed for
redemption of the Debentures. For purposes of the calculation of the date of
redemption or exchange and the dates on which notices are given pursuant to this
Section 7.4, a Redemption/Distribution Notice shall be deemed to be given on the
later of the date of any publication in Luxembourg, if required, and the seventh
day after such notice is first mailed by first-class mail, postage prepaid, to
Holders of Securities. Each Redemption/Distribution Notice shall be addressed to
the Holders of Securities at the address of each such Holder appearing in the
books and records of the Trust. No defect in the Redemption/Distribution Notice
or in the mailing of either thereof with respect to any Holder shall affect the
validity of the redemption or exchange proceedings with respect to any other
Holder.
(b) If fewer than all the outstanding Securities are to be so redeemed,
the Common Securities and the Capital Securities will be redeemed Pro Rata and
the Capital Securities to be redeemed will be redeemed as described below. The
Trust may not redeem the Securities in part unless all accrued and unpaid
interest has been paid in full on all Securities then outstanding plus accrued
but unpaid interest to the date of redemption. For all purposes of this
Declaration, unless the context otherwise requires, all provisions relating to
the redemption of Capital Securities shall relate, in the case of any Capital
Security redeemed or to be redeemed only in part, to the portion of the
aggregate liquidation amount of Capital Securities which has been or is to be
redeemed.
(c) If Securities are to be redeemed and the Trust gives a
Redemption/Distribution Notice, which notice may only be issued if the
Debentures are redeemed as set out in this Section 7.4 (which notice will be
irrevocable), then (A) by 12:00 noon, New York City time, on the redemption date
with respect to Global Securities, the Property Trustee, to the extent funds are
available, will deposit irrevocably with the DTC (in the case of book-entry form
Capital Securities) or its nominee (or successor Clearing Agency or its nominee)
funds sufficient to pay the applicable Redemption Price with respect to the
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Capital Securities held in DTC and will give the DTC irrevocable instructions
and authority to pay the Redemption Price to the Holders of the Capital
Securities held through DTC, and (B) with respect to Capital Securities and
Common Securities issued in definitive form, the Property Trustee, to the extent
funds are available, will irrevocably deposit with the paying agent for such
Capital Securities and Common Securities funds sufficient to pay the relevant
Redemption Price to the Holders and will give the paying agent irrevocable
instructions and authority to pay the Redemption Price to such Holders upon
surrender of their certificates evidencing the Capital Securities or Common
Securities. If a Redemption/Distribution Notice shall have been given and funds
deposited as required, then immediately prior to the close of business on the
date of such deposit, distributions will cease to accrue on the Securities so
called for redemption and all rights of Holders of such Securities will cease,
except the right of the Holders of such Securities to receive the Redemption
Price, but without interest on such Redemption Price. If any date fixed for
redemption of Securities is not a Business Day, then payment of the Redemption
Price payable on such date will be made on the next succeeding day that is a
Business Day (and without any interest or other payment in respect of any such
delay) except that, if such Business Day falls in the next calendar year, such
payment will be made on the immediately preceding Business Day, in each case
with the same force and effect as if made on such date fixed for redemption. If
payment of the Redemption Price in respect of any Securities is improperly
withheld or refused and not paid either by the Property Trustee or by the
Sponsor as guarantor pursuant to the Guarantee, Distributions on such Securities
will continue to accrue at the then applicable rate from the original redemption
date to the actual date of payment, in which case the actual payment date will
be considered the date fixed for redemption for purposes of calculating the
Redemption Price. For these purposes, the applicable Redemption Price shall not
include Distributions which are being paid to Holders who were Holders on a
relevant record date. Upon satisfaction of the foregoing conditions, then
immediately prior to the close of business on the date of such deposit or
payment, all rights of Holders of such Debentures so called for redemption will
cease, except the right of the Holders to receive the Redemption Price, but
without interest on such Redemption Price, and from and after the date fixed for
redemption, such Debentures will not accrue distributions or bear interest.
Neither the Regular Trustees nor the Trust shall be required to
register or cause to be registered the transfer or exchange of any Securities
that have been called for redemption, except in the case of any Securities being
redeemed in part, any portion thereof not to be redeemed.
(d) Subject to the foregoing and applicable law (including, without
limitation, United States Federal securities laws), the Debenture Issuer or its
subsidiaries may at any time and from time to time purchase outstanding Capital
Securities by tender, in the open market or by private agreement.
Section 7.5 Voting Rights of Capital Securities.
(a) Except as provided under this Article VII and as otherwise required
by the Business Trust Act, the Trust Indenture Act and other applicable law, the
Holders of the Capital Securities will have no voting rights.
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(b) Subject to the requirement of the Property Trustee obtaining a tax
opinion in certain circumstances set forth in Section 7.5(d) below, the Holders
of a Majority in Liquidation Amount of the Capital Securities have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Property Trustee, or to direct the exercise of any trust or
power conferred upon the Property Trustee under the Declaration, including the
right to direct the Property Trustee, as Holder of the Debentures, to (i)
exercise the remedies available to it under the Indenture as a Holder of the
Debentures or (ii) consent to any amendment or modification of the Indenture or
the Debentures where such consent shall be required; provided, however, that
where a consent or action under the Indenture would require the consent or act
of the Holders of more than a majority in aggregate principal amount of
Debentures affected thereby, only the Holders of the percentage of the aggregate
stated liquidation amount of the Capital Securities which is at least equal to
the percentage required under the Indenture may direct the Property Trustee to
give such consent to take such action.
(c) If the Property Trustee fails to enforce its rights under the
Debentures after a Holder of record of Capital Securities has made a written
request, such Holder of record of Capital Securities may, to the extent
permitted by applicable law, institute a legal proceeding directly against the
Debenture Issuer to enforce the Property Trustee's rights under the Indenture
without first instituting any legal proceeding against the Property Trustee or
any other person or entity. Notwithstanding the foregoing, if a Trust
Enforcement Event has occurred and is continuing and such event is attributable
to the failure of the Debenture Issuer to make any required payment when due
under the Indenture, then a Holder of Capital Securities may directly institute
a proceeding against the Debenture Issuer for enforcement of such payment under
the Indenture.
(d) The Property Trustee shall notify all Holders of the Capital
Securities of any written notice of any Indenture Event of Default received from
the Debenture Issuer with respect to the Debentures. Such notice shall state
that such Indenture Event of Default also constitutes a Trust Enforcement Event.
Except with respect to directing the time, method, and place of conducting a
proceeding for a remedy, the Property Trustee shall be under no obligation to
take any of the actions described in clause 7.5(b)(i) and (ii) above unless the
Property Trustee has obtained an opinion of independent tax counsel to the
effect that as a result of such action, the Trust will not fail to be classified
as a grantor trust for United States federal income tax purposes and each Holder
will be treated as owning an undivided beneficial ownership interest in the
Debentures.
(e) In the event the consent of the Property Trustee, as the Holder of
the Debentures, is required under the Indenture with respect to any amendment or
modification of the Indenture, the Property Trustee shall request the direction
of the Holders of the Securities with respect to such amendment or modification
and shall vote with respect to such amendment or modification as directed by a
Majority in Liquidation Amount of the Securities voting together as a single
class; provided, however, that where a consent under the Indenture would require
the consent of the Holders of more than a majority in aggregate principal amount
of the Debentures, the Property Trustee may only give such consent at the
direction of the Holders of at least the same proportion in aggregate stated
liquidation amount of the
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Securities. The Property Trustee shall not take any such action in accordance
with the directions of the Holders of the Securities unless the Property Trustee
has obtained an opinion of tax counsel to the effect that, as a result of such
action, the Trust will not be classified as other than a grantor trust for
United States federal income tax purposes and each Holder will be treated as
owning an undivided beneficial ownership interest in the Debentures.
(f) A waiver of an Indenture Event of Default with respect to the
Debentures will constitute a waiver of the corresponding Trust Enforcement
Event.
(g) Any required approval or direction of Holders of Capital Securities
may be given at a separate meeting of Holders of Capital Securities convened for
such purpose, at a meeting of all of the Holders of Securities or pursuant to
written consent. The Regular Trustees will cause a notice of any meeting at
which Holders of Capital Securities are entitled to vote, or of any matter upon
which action by written consent of such Holders is to be taken, to be mailed to
each Holder of record of Capital Securities. Each such notice will include a
statement setting forth the following information: (i) the date of such meeting
or the date by which such action is to be taken; (ii) a description of any
resolution proposed for adoption at such meeting on which such Holders are
entitled to vote or of such matter upon which written consent is sought; and
(iii) instructions for the delivery of proxies or consents.
(h) No vote or consent of the Holders of Capital Securities will be
required for the Trust to redeem and cancel Capital Securities or distribute
Debentures in accordance with the Declaration.
(i) Notwithstanding that Holders of Capital Securities are entitled to
vote or consent under any of the circumstances described above, any of the
Securities that are owned at such time by the Debenture Issuer or any Trustee or
any entity directly or indirectly controlled by, or under direct or indirect
common control with, the Debenture Issuer or any Trustee, shall not be entitled
to vote or consent and shall, for purposes of such vote or consent, be treated
as if such Securities were not outstanding, provided, however that persons
otherwise eligible to vote to whom the Debenture Issuer or any Trustee or any of
their subsidiaries have pledged Capital Securities may vote or consent with
respect to such pledged Capital Securities under any of the circumstances
described herein.
(j) Holders of the Capital Securities will have no rights to appoint or
remove the Trustees, who may be appointed, removed or replaced solely by the
Debenture Issuer, as the Holder of all of the Common Securities.
Section 7.6 Voting Rights of Common Securities.
(a) Except as provided under Section 6.1(b) or this Section 7.6 or as
otherwise required by the Business Trust Act, the Trust Indenture Act or other
applicable law or provided by the Declaration, the Holders of the Common
Securities will have no voting rights.
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(b) The Holders of the Common Securities are entitled, in accordance
with Article 6 of the Declaration, to vote to appoint, remove or replace any
Trustee or to increase or decrease the number of Trustees.
(c) Subject to Section 2.6 of the Declaration and only after all Trust
Enforcement Events with respect to the Capital Securities have been cured,
waived, or otherwise eliminated and subject to the requirement of the Property
Trustee obtaining a tax opinion in certain circumstances set forth in this
paragraph (c), the Holders of a Majority in liquidation amount of the Common
Securities have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Property Trustee, or direct the
exercise of any trust or power conferred upon the Property Trustee under the
Declaration, including the right to direct the Property Trustee, as Holder of
the Debentures, to (i) exercise the remedies available to it under the Indenture
as a Holder of the Debentures, or (ii) consent to any amendment or modification
of the Indenture or the Debentures where such consent shall be required;
provided, however, that where a consent or action under the Indenture would
require the consent or act of the Holders of more than a majority in aggregate
principal amount of Debentures affected thereby, only the Holders of the
percentage of the aggregate stated liquidation amount of the Common Securities
which is at least equal to the percentage required under the Indenture may
direct the Property Trustee to have such consent or take such action. Except
with respect to directing the time, method, and place of conducting a proceeding
for a remedy, the Property Trustee shall be under no obligation to take any of
the actions described in clause 7.6(c)(i) and (ii) above unless the Property
Trustee has obtained an opinion of independent tax counsel to the effect that,
as a result of such action, for United States federal income tax purposes the
Trust will not fail to be classified as a grantor trust and each Holder will be
treated as owning an undivided beneficial interest in the Debentures.
(d) If the Property Trustee fails to enforce its rights under the
Debentures after a Holder of record of Common Securities has made a written
request, such Holder of record of Common Securities may, to the extent permitted
by applicable law, directly institute a legal proceeding directly against the
Debenture Issuer, as sponsor of the Trust, to enforce the Property Trustee's
rights under the Debentures without first instituting any legal proceeding
against the Property Trustee or any other person or entity.
(e) A waiver of an Indenture Event of Default with respect to the
Debentures will constitute a waiver of the corresponding Trust Enforcement
Event.
(f) Any required approval or direction of Holders of Common Securities
may be given at a separate meeting of Holders of Common Securities convened for
such purpose, at a meeting of all of the Holders of Securities or pursuant to
written consent. The Regular Trustees will cause a notice of any meeting at
which Holders of Common Securities are entitled to vote, or of any matter on
which action by written consent of such Holders is to be taken, to be mailed to
each Holder of Common Securities. Each such notice will include a statement
setting forth the following information: (i) the date of such meeting or the
date by which such action is to be taken; (ii) a description of any resolution
proposed for adoption at such meeting on which such Holders are entitled to vote
or of such matter upon which written consent is sought; and (iii) instructions
for the delivery of proxies or consents.
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(g) No vote or consent of the Holders of Common Securities will be
required for the Trust to redeem and cancel Common Securities or to distribute
Debentures in accordance with the Declaration and the terms of the Securities.
Section 7.7 Paying Agent.
In the event that any Capital Securities are not in book-entry only
form, the Trust shall maintain in the Borough of Manhattan, City of New York,
State of New York and in Luxembourg, at all times and so long as any Capital
Securities are listed on the Luxembourg Stock Exchange and such exchange so
requires, an office or agency where the Capital Securities may be presented for
payment (each a "Paying Agent"). The Trust may appoint the Paying Agents and may
appoint additional Paying Agents in such other locations as it shall determine.
The term "Paying Agent" includes any additional Paying Agents. The Trust may
change any Paying Agent without prior notice to the Holders. The Trust shall
notify the Property Trustee of the name and address of any Paying Agent not a
party to this Declaration. If the Trust fails to appoint or maintain another
entity as Paying Agent, the Property Trustee shall act as such; provided,
however, that at all times and so long as any Capital Securities are listed on
the Luxembourg Stock Exchange and such exchange so requires, the Property
Trustee shall designate and maintain a paying agent in Luxembourg. The Trust or
any of its Affiliates may act as a Paying Agent. The Chase Manhattan Bank and
Chase Manhattan Bank Luxembourg, S.A. shall initially act as Paying Agents for
the Capital Securities and The Chase Manhattan Bank will act as initial Paying
Agent for the Common Securities. In the event the Property Trustee shall no
longer be the Paying Agent, the Regular Trustees shall appoint a successor
(which shall be a bank or trust company acceptable to the Regular Trustees and
Debenture Issuer) to act as Paying Agent. The Paying Agent shall be permitted to
resign as Paying Agent upon 30 days' written notice to the Property Trustee and
the Debenture Issuer.
Section 7.8 Transfer of Securities.
(a) The Trust shall cause to be kept at the Corporate Trust Office of
the Property Trustee a register (the register maintained in such office being
herein sometimes referred to as the "Security Register") in which, subject to
such reasonable regulations as it may prescribe, the Trust shall provide for the
registration of Capital Securities and of transfers of Capital Securities. The
Property Trustee is hereby appointed "Security Registrar" for the purpose of
registering Capital Securities and transfers of Capital Securities as herein
provided.
(b) Upon surrender for registration of transfer of any Security at an
office or agency of the Trust designated for such purpose, the Trust shall
execute, upon receipt of an order to authenticate, and the Property Trustee
shall authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Securities of any authorized denominations and of a
like aggregate principal amount.
(c) At the option of the Holder, Securities may be exchanged for other
Securities of any authorized denominations and of a like aggregate principal
amount, upon surrender of the Securities to be exchanged at such office or
agency. Whenever any Securities
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are so surrendered for exchange, the Trust shall execute, and the Property
Trustee shall authenticate and deliver, the Securities which the Holder making
the exchange is entitled to receive.
(d) Every Security presented or surrendered for registration of
transfer or for exchange shall (if so required by the Trust) be duly endorsed,
or be accompanied by a written instrument of transfer in form satisfactory to
the Trust duly executed, by the Holder thereof or his attorney duly authorized
in writing.
(e) No service charge shall be made for any registration of transfer or
exchange of Securities, but the Trust may require payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Securities.
(f) If the Securities are to be redeemed in part, the Trust shall not
be required (A) to issue, register the transfer of or exchange any Securities
during a period beginning at the opening of business 15 days before the day of
the mailing of a notice of redemption of any such Securities selected for
redemption under Section 7.4 and ending at the close of business on the day of
such mailing, or (B) to register the transfer of or exchange any Security so
selected for redemption in whole or in part, except the unredeemed portion of
any Security being redeemed in part.
Section 7.9 Mutilated, Destroyed, Lost or Stolen Certificates.
If:
(a) any mutilated Certificates should be surrendered to the Regular
Trustees, or if the Regular Trustees shall receive evidence to their
satisfaction of the destruction, loss or theft of any Certificate; and
(b) there shall be delivered to the Regular Trustees such security or
indemnity as may be required by them to keep each of them, the Sponsor and the
Trust harmless, then, in the absence of notice that such Certificate shall have
been acquired by a bona fide purchaser, any Regular Trustee on behalf of the
Trust shall execute and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
denomination. In connection with the issuance of any new Certificate under this
Section 7.9, the Regular Trustees may require the payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
therewith. Any duplicate Certificate issued pursuant to this Section shall
constitute conclusive evidence of an ownership interest in the relevant
Securities, as if originally issued, whether or not the lost, stolen or
destroyed Certificate shall be found at any time.
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Section 7.10 Deemed Security Holders.
The Trustees may treat the Person in whose name any Certificate shall
be registered on the books and records of the Trust as the sole holder of such
Certificate and of the Securities represented by such Certificate for purposes
of receiving Distributions and for all other purposes whatsoever and,
accordingly, shall not be bound to recognize any equitable or other claim to or
interest in such Certificate or in the Securities represented by such
Certificate on the part of any Person, whether or not the Trust shall have
actual or other notice thereof.
Section 7.11 Global Securities.
If the Trust shall establish that the Capital Securities are to be
issued in global form (each, a "Global Security"), then a Regular Trustee on
behalf of the Trust shall execute, upon receipt of an order to authenticate, and
the Property Trustee shall authenticate and deliver one or more Global
Securities that (i) shall represent and shall be denominated in an amount equal
to the aggregate liquidation amount of all of the Capital Securities to be
issued in the form of Global Securities and not yet cancelled, (ii) shall be
registered in the name of the Depositary for such Global Security or Capital
Securities or the nominee of such Depositary, and (iii) shall be delivered by
the Property Trustee to such Depositary or pursuant to such Depositary's
instructions. Global Securities shall bear a legend substantially to the
following effect:
"This Capital Security is a Global Security within the meaning of the
Declaration hereinafter referred to and is registered in the name of a
Depositary or a nominee of a Depositary. Notwithstanding the provisions of
Section 7.8 of the Declaration, unless and until it is exchanged in whole or in
part for Capital Securities in definitive registered form, a Global Security
representing all or a part of the Capital Securities may not be transferred in
the manner provided in Section 7.8 of the Declaration except as a whole by the
Depositary to a nominee of such Depositary or by a nominee of such Depositary to
such Depositary or another nominee of such Depositary or by such Depositary or
any such nominee to a successor Depositary or a nominee of such successor
Depositary. Every Capital Security delivered upon registration or transfer of,
or in exchange for, or in lieu of, this Global Security shall be a Global
Security subject to the foregoing, except in the limited circumstances described
above. Unless this certificate is presented by an authorized representative of
DTC to the Trust or its agent for registration of transfer, exchange or payment,
and any certificate issued is registered in the name of Cede & Co. or in such
other name as is requested by an authorized representative of DTC (and any
payment is to be made to Cede & Co. or to such other entity as is requested by
an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the
registered owner hereof, Cede & Co., has an interest herein."
Definitive Capital Securities issued in exchange for all or a part of a
Global Security pursuant to this Section 7.11 shall be registered in such names
and in such authorized denominations as the Depositary, pursuant to instructions
from its direct or indirect participants or otherwise, shall instruct the
Property Trustee. Upon execution and
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authentication, the Property Trustee shall deliver such definitive Capital
Securities to the persons in whose names such definitive Capital Securities are
so registered.
At such time as all interests in Global Securities have been redeemed,
repurchased or canceled, such Global Securities shall be, upon receipt thereof,
canceled by the Property Trustee in accordance with its standing procedures in
effect from time to time and instructions existing between the Depositary and
the Custodian. At any time prior to such cancellation, if any interest in Global
Securities is exchanged for definitive Capital Securities, redeemed, canceled or
transferred to a transferee who receives definitive Capital Securities therefor
or any definitive Capital Security is exchanged or transferred for part of
Global Securities, the principal amount of such Global Securities shall, in
accordance with the standing procedures in effect from time to time and
instructions existing between the Depositary and the Custodian, be reduced or
increased, as the case may be, and an endorsement shall be made on such Global
Securities by the Property Trustee or the Custodian, at the direction of the
Property Trustee, to reflect such reduction or increase.
The Trust and the Property Trustee may for all purposes, including the
making of payments due on the Capital Securities, deal with the Depositary as
the authorized representative of the Holders for the purposes of exercising the
rights of Holders hereunder. The rights of the owner of any beneficial interest
in a Global Security shall be limited to those established by law and agreements
between such owners and depositary participants or Euroclear and Cedel; provided
that no such agreement shall give any rights to any person against the Trust or
the Property Trustee without the written consent of the parties so affected.
Multiple requests and directions from and votes of the Depositary as holder of
Capital Securities in global form with respect to any particular matter shall
not be deemed inconsistent to the extent they do not represent an amount of
Capital Securities in excess of those held in the name of the Depositary or its
nominee.
If at any time the Depositary for any Capital Securities represented by
one or more Global Securities notifies the Trust that it is unwilling or unable
to continue as Depositary for such Capital Securities or if at any time the
Depositary for such Capital Securities shall no longer be eligible under this
Section 7.11, the Trust shall appoint a successor Depositary with respect to
such Capital Securities. If a successor Depositary for such Capital Securities
is not appointed by the Trust within 90 days after the Trust receives such
notice or becomes aware of such ineligibility, the Trust's election that such
Capital Securities be represented by one or more Global Securities shall no
longer be effective and a Regular Trustee on behalf of the Trust shall execute,
and the Property Trustee will authenticate and deliver Capital Securities in
definitive registered form, in any authorized denominations, in an aggregate
liquidation amount equal to the principal amount of the Global Security or
Capital Securities representing such Capital Securities in exchange for such
Global Security or Capital Securities.
The Trust may at any time and in its sole discretion determine that the
Capital Securities issued in the form of one or more Global Securities shall no
longer be represented by a Global Security or Capital Securities. In such event
a Regular Trustee on behalf of the Trust shall execute, and the Property
Trustee, shall authenticate and deliver, Capital Securities
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in definitive registered form, in any authorized denominations, in an aggregate
liquidation amount equal to the principal amount of the Global Security or
Capital Securities representing such Capital Securities, in exchange for such
Global Security or Capital Securities.
Notwithstanding any other provisions of this Declaration, Global
Securities may not be transferred as a whole except by the Depositary to a
nominee of the Depositary or by a nominee of the Depositary to the Depositary or
another nominee of the Depositary or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary.
Interests of beneficial owners in Global Security may be transferred or
exchanged for definitive Capital Securities and definitive Capital Securities
may be transferred or exchange for Global Securities in accordance with rules of
the Depositary.
Any Capital Security in global form may be endorsed with or have
incorporated in the text thereof such legends or recitals or changes not
inconsistent with the provisions of this Declaration as may be required by the
Custodian, the Depositary or by the National Association of Securities Dealers,
Inc. in order for the Capital Securities to be tradeable on the PORTAL Market or
as may be required for the Capital Securities to be tradeable on any other
market developed for trading of securities pursuant to Rule 144A or required to
comply with any applicable law or any regulation thereunder or with Regulation S
or with the rules and regulations of any securities exchange upon which the
Capital Securities may be listed or traded or to conform with any usage with
respect thereto, or to indicate any special limitations or restrictions to which
any particular Capital Securities are subject.
Section 7.12 Restrictive Legend.
(a) Each Global Security and definitive Capital Security that
constitutes a Restricted Security shall bear the following legend (the "Private
Placement Legend") on the face thereof until three years after the later of the
date of original issue and the last date on which the Sponsor or any affiliate
of the Sponsor was the owner of such Capital Securities (or any predecessor
thereto) (the "Resale Restriction Termination Date"), unless otherwise agreed by
the Trust and the Holder thereof:
"THIS CAPITAL SECURITY (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), ANY
STATE SECURITIES LAWS AND NEITHER THIS CAPITAL SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF THIS CAPITAL SECURITY IS HEREBY NOTIFIED THAT THE SELLER MAY BE
RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES
ACT PROVIDED BY RULE 144A, REGULATION S OR ANOTHER EXEMPTION THEREUNDER. THE
HOLDER OF THIS CAPITAL SECURITY, BY ITS ACCEPTANCE HEREOF, REPRESENTS,
ACKNOWLEDGES AND AGREES FOR THE BENEFIT OF THE
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TRUST THAT: (I) IT HAS ACQUIRED A "RESTRICTED" SECURITY WHICH HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT; (II) IT WILL NOT OFFER, SELL OR
OTHERWISE TRANSFER THIS CAPITAL SECURITY PRIOR TO THE LATER OF THE DATE
WHICH IS THREE YEARS AFTER THE DATE OF ORIGINAL ISSUANCE HEREOF AND THE LAST
DATE ON WHICH THE TRUST OR ANY AFFILIATE OF THE TRUST WAS THE OWNER OF SUCH
RESTRICTED SECURITIES (OR ANY PREDECESSOR) EXCEPT (A) TO THE TRUST, (B)
PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER
THE SECURITIES ACT, (C) FOR SO LONG AS THIS CAPITAL SECURITY IS ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A, TO A PERSON WHO THE SELLER REASONABLY BELIEVES
IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (D)
OUTSIDE THE UNITED STATES IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
904 UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL "ACCREDITED INVESTOR,"
WITHIN THE MEANING OF SUBPARAGRAPH (A)(1), (2), (3) OR (7) OF RULE 501 UNDER
THE SECURITIES ACT THAT IS ACQUIRING THE SECURITIES FOR ITS OWN ACCOUNT OR
FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL "ACCREDITED INVESTOR," FOR
INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN
CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (F)
PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT AND, IN EACH CASE, IN ACCORDANCE WITH THE APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY APPLICABLE
JURISDICTION; AND (III) IT WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO,
NOTIFY ANY PURCHASER FROM IT OF THIS CAPITAL SECURITY OF THE RESALE
RESTRICTIONS SET FORTH IN (II) ABOVE. ANY OFFER, SALE OR OTHER DISPOSITION
PURSUANT TO THE FOREGOING CLAUSES (II)(D), (E) AND (F) IS SUBJECT TO THE
RIGHT OF THE ISSUER OF THIS CAPITAL SECURITY AND THE PROPERTY TRUSTEE FOR
SUCH CAPITAL SECURITIES TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATIONS OR OTHER INFORMATION ACCEPTABLE TO THEM IN FORM AND
SUBSTANCE."
Any Capital Security (or security issued in exchange or substitution
therefor) as to which such restrictions on transfer shall have expired in
accordance with their terms may, upon satisfaction of the requirements of
Section 7.12(b) and surrender of such Capital Security for exchange to the
Capital Security Registrar in accordance with the provisions of this Section
7.12(a), be exchanged for a new Capital Security or Capital Securities, of like
tenor and aggregate liquidation amount, which shall not bear the restrictive
legend required by this Section 7.12(a).
(b) Upon any sale or transfer of any Restricted Security (including any
interest in a Global Security) (i) that is effected pursuant to an effective
registration statement under
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the Securities Act or (ii) in connection with which the Property Trustee
receives certificates and other information (including an opinion of counsel, if
requested) reasonably acceptable to the Sponsor to the effect that such security
will no longer be subject to the resale restrictions under federal and state
securities laws, then (A) in the case of a Restricted Security in definitive
form, the Capital Security registrar or co-registrar shall permit the holder
thereof to exchange such Restricted Security for a security that does not bear
the legend set forth in Section 7.12(a), and shall rescind any such restrictions
on transfer and (B) in the case of Restricted Securities represented by a Global
Security, such Capital Security shall no longer be subject to the restrictions
contained in the legend set forth in Section 7.12(a) (but still subject to the
other provisions hereof). In addition, any Capital Security (or security issued
in exchange or substitution therefor) as to which the restrictions on transfer
described in the legend set forth in Section 7.12(a) have expired by their
terms, may, upon surrender thereof (in accordance with the terms of this
Indenture) together with such certifications and other information (including an
opinion of counsel having substantial experience in practice under the
Securities Act and otherwise reasonably acceptable to the Sponsor, addressed to
the Sponsor and the Property Trustee and in a form acceptable to the Sponsor, to
the effect that the transfer of such Restricted Security has been made in
compliance with Rule 144 or such successor provision) acceptable to the Sponsor
and the Property Trustee as either of them may reasonably require, be exchanged
for a new Capital Security or Capital Securities of like tenor and aggregate
liquidation amount, which shall not bear the restrictive legends set forth in
Section 7.12(a). Notwithstanding anything to the contrary, the Property Trustee
may conclusively rely upon the completed certificate set forth in the
certificate evidencing the Capital Securities.
Section 7.13 Special Transfer Provisions.
(a) At any time at the request of the beneficial Holder of a Capital
Security in global form, such beneficial holder shall be entitled to obtain a
definitive Capital Security upon written request to the Property Trustee in
accordance with the standing instructions and procedures existing between the
Depositary and the Property Trustee for the issuance thereof. Any transfer of a
beneficial interest in a Capital Security in global form which cannot be
effected through book-entry settlement must be effected by the delivery to the
transferee (or its nominee) of a definitive Capital Security or Securities
registered in the name of the transferee (or its nominee) on the books
maintained by the Security Registrar. With respect to any such transfer, the
Property Trustee will cause, in accordance with the standing instructions and
procedures existing between the Depositary and the Property Trustee, the
aggregate liquidation amount of the Global Security to be reduced and, following
such reduction, the Property Trustee will cause definitive Capital Securities
(which have been executed and delivered to it as a Regular Trustee) in the
appropriate aggregate liquidation amount in the name of such transferee (or its
nominee) and bearing such restrictive legends as may be required by this
Declaration to be delivered. In connection with any such transfer, the Property
Trustee may request such representations and agreements relating to the
restrictions on transfer of such Capital Securities from such transferee (or
such transferee's nominee) as the Property Trustee may reasonably require.
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(b) So long as the Capital Securities are eligible for book-entry
settlement, or unless otherwise required by law, upon any transfer of a
definitive Capital Security to a QIB in accordance with Rule 144A, unless
otherwise requested by the transferor, and upon receipt of the definitive
Capital Security being so transferred, together with a certification from the
transferor that the transferor reasonably believes the transferee is a QIB (or
other evidence satisfactory to the Property Trustee), the Property Trustee shall
make an endorsement on the Restricted Global Security to reflect an increase in
the aggregate liquidation amount of the Restricted Global Security, and the
Property Trustee shall cancel such definitive Capital Security and cause, in
accordance with the standing instructions and procedures existing between the
Depositary and the Property Trustees, the aggregate liquidation amount of
Capital Securities represented by the Restricted Global Security to be increased
accordingly.
(c) So long as the Capital Securities are eligible for book-entry
settlement, or unless otherwise required by law, upon any transfer of a
definitive Capital Security in accordance with Regulation S, if requested by the
transferor, and upon receipt of the definitive Capital Security or Capital
Securities being so transferred, together with a certification from the
transferor that the transfer was made in accordance with Rule 903 or 904 of
Regulation S or Rule 144 under the Securities Act (or other evidence
satisfactory to the Property Trustee), the Property Trustee shall make or direct
the Custodian to make, an endorsement on the Regulation S Global Security to
reflect an increase in the aggregate liquidation amount of the Capital
Securities represented by the Regulation S Global Security, the Property Trustee
shall cancel such definitive Capital Security or Capital Securities and cause,
or direct the Custodian to cause, in accordance with the standing instructions
and procedures existing between the Depositary and the Property Trustee, the
aggregate liquidation amount of Capital Securities represented by the Regulation
S Global Security to be increased accordingly. Notwithstanding anything to the
contrary, the Property Trustee may conclusively rely upon the completed
certificate set forth in the certificate evidencing the Capital Securities.
(d) If a holder of a beneficial interest in the Restricted Global
Security wishes at any time to exchange its interest in the Restricted Global
Security for an interest in the Regulation S Global Security, or to transfer its
interest in the Restricted Global Security to a person who wishes to take
delivery thereof in the form of an interest in the Regulation S Global Security,
such holder may, subject to the rules and procedures of the Depositary and to
the requirements set forth in the following sentence, exchange or cause the
exchange or transfer or cause the transfer of such interest for an equivalent
beneficial interest in the Regulation S Global Security. Upon receipt by the
Property Trustee of (1) instructions given in accordance with the Depositary's
procedures from or on behalf of a holder of a beneficial interest in the
Restricted Global Security, directing the Property Trustee (via DWAC), as
transfer agent, to credit or cause to be credited a beneficial interest in the
Regulation S Global Security in an amount equal to the beneficial interest in
the Restricted Global Security to be exchanged or transferred, (2) a written
order in accordance with the Depositary's procedures containing information
regarding the Euroclear or Cedel account to be credited with such increase and
the name of such account, and (3) a certificate given by the holder of such
beneficial interest stating that the exchange or transfer of such interest has
been made pursuant to and in accordance with Rule 903 or Rule 904 of Regulation
S or Rule 144 under the Securities Act, the Property Trustee, as transfer agent,
shall promptly deliver appropriate
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instructions to the Depositary (via DWAC), its nominee, or the custodian for the
Depositary, as the case may be, to reduce or reflect on its records a reduction
of the Restricted Global Security by the aggregate liquidation amount of the
beneficial interest in such Restricted Global Security to be so exchanged or
transferred from the relevant participant, and the Property Trustee, as transfer
agent, shall promptly deliver appropriate instructions (via DWAC) to the
Depositary, its nominee, or the custodian for the Depositary, as the case may
be, concurrently with such reduction, to increase or reflect on its records an
increase of the liquidation amount of such Regulation S Global Security by the
aggregate liquidation amount of the beneficial interest in such Restricted
Global Security to be so exchanged or transferred, and to credit or cause to be
credited to the account of the person specified in such instructions (who may be
Morgan Guaranty Trust Company of New York, Brussels office, as operator of
Euroclear or Cedel or another agent member of Euroclear or Cedel, or both, as
the case may be, acting for and on behalf of them) a beneficial interest in such
Regulation S Global Security equal to the reduction in the liquidation amount of
such Restricted Global Security. Notwithstanding anything to the contrary, the
Property Trustee may conclusively rely upon the completed certificate set forth
in the certificate evidencing the Capital Securities.
(e) If a holder of a beneficial interest in the Regulation S Global
Security wishes at any time to exchange its interest in the Regulation S Global
Security for an interest in the Restricted Global Security, or to transfer its
interest in the Regulation S Global Security to a person who wishes to take
delivery thereof in the form of an interest in the Restricted Global Security,
such holder may, subject to the rules and procedures of Euroclear or Cedel and
the Depositary, as the case may be, and to the requirements set forth in the
following sentence, exchange or cause the exchange or transfer or cause the
transfer of such interest for an equivalent beneficial interest in such
Restricted Global Security. Upon receipt by the Property Trustee, as transfer
agent of (l) instructions given in accordance with the procedures of Euroclear
or Cedel and the Depositary, as the case may be, from or on behalf of a
beneficial owner of an interest in the Regulation S Global Security directing
the Property Trustee, as transfer agent, to credit or cause to be credited a
beneficial interest in the Restricted Global Security in an amount equal to the
beneficial interest in the Regulation S Global Security to be exchanged or
transferred, (2) a written order given in accordance with the procedures of
Euroclear or Cedel and the Depositary, as the case may be, containing
information regarding the account with the Depositary to be credited with such
increase and the name of such account, and (3) prior to the expiration of the
Restricted Period, a certificate given by the holder of such beneficial interest
and stating that the person transferring such interest in such Regulation S
Global Security reasonably believes that the person acquiring such interest in
the Restricted Global Security is a QIB and is obtaining such beneficial
interest in a transaction meeting the requirements of Rule 144A and any
applicable securities laws of any state of the United States or any other
jurisdiction (or other evidence satisfactory to the Property Trustee), the
Property Trustee, as transfer agent, shall promptly deliver (via DWAC)
appropriate instructions to the Depositary, its nominee, or the custodian for
the Depositary, as the case may be, to reduce or reflect on its records a
reduction of the Regulation S Global Security by the aggregate liquidation
amount of the beneficial interest in such Regulation S Global Security to be
exchanged or transferred, and the Property Trustee , as transfer agent, shall
promptly deliver (via DWAC) appropriate instructions to the Depositary, its
nominee, or the custodian for the Depositary, as the case may be, concurrently
with such reduction, to increase or reflect
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on its records an increase of the liquidation amount of the Restricted Global
Security by the aggregate liquidation amount of the beneficial interest in the
Regulation S Global Security to be so exchanged or transferred, and to credit or
cause to be credited to the account of the person specified in such instructions
a beneficial interest in the Restricted Global Security equal to the reduction
in the liquidation amount of the Regulation S Global Security. After the
expiration of the Restricted Period, the certification requirement set forth in
clause (3) of the second sentence of this Section 7.13 will no longer apply to
such exchanges and transfers. Notwithstanding anything to the contrary, the
Property Trustee may conclusively rely upon the completed certificate set forth
in the certificate evidencing the Capital Securities.
(f) Any beneficial interest in one of the Global Securities that is
transferred to a person who takes delivery in the form of an interest in the
other Global Security will, upon transfer, cease to be an interest in such
Global Security and become an interest in the other Global Security and,
accordingly, will thereafter be subject to all transfer restrictions and other
procedures applicable to beneficial interests in such other Global Security for
as long as it remains such an interest.
ARTICLE 8
DISSOLUTION AND TERMINATION OF TRUST
Section 8.1 Dissolution and Termination of Trust.
(a) The Trust shall dissolve upon the earliest of:
(i) January 31, 2052, the expiration time of the Trust;
(ii) any liquidation, insolvency or similar proceeding with respect to
the Holder of the Common Securities or the Sponsor or all or
substantially all of their property;
(iii) the entry of a decree of judicial dissolution of the Sponsor or
the Trust;
(iv) the time when all of the Securities shall have matured or been
called for redemption and the amounts then due shall have been
paid to the Holders in accordance with the terms of the
Securities;
(v) upon the election of the Sponsor, following the occurrence and
continuation of a Special Event pursuant to which the Trust shall
have been dissolved in accordance with the terms of the
Securities, and all of the Debentures shall have been distributed
to the Holders of Securities in exchange for all of the
Securities; or
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(vi) an election by a Majority in Liquidation Amount of the Common
Securities provided such action is taken before the issuance of
any Securities.
(b) As soon as is practicable after the occurrence of an event referred
to in Section 8.1(a) and upon completion of the winding up of the Trust, the
Trustees shall terminate the Trust by filing a certificate of cancellation with
the Secretary of State of the State of Delaware.
(c) The provisions of Section 3.9 and Article 9 shall survive the
termination of the Trust.
Section 8.2 Liquidation Distribution Upon Termination and Dissolution
of the Trust.
(a) In the event of any voluntary or involuntary liquidation,
dissolution, winding-up or termination of the Trust (each a "Liquidation"), the
Holders of the Capital Securities on the date of the Liquidation will be
entitled to receive, out of the assets of the Trust available for distribution
to Holders of Securities after satisfaction of the Trusts' liabilities and
creditors, distributions in cash or other immediately available funds in an
amount equal to the aggregate of the stated liquidation amount of $1,000 per
Security plus accrued and unpaid Distributions thereon to the date of payment
(such amount being the "Liquidation Distribution"), unless, in connection with
such Liquidation, Debentures in an aggregate principal amount equal to the
aggregate liquidation amount of, with an interest rate identical to the interest
rate of, and accrued and unpaid distributions equal to accrued and unpaid
distributions on, such Securities shall be distributed on a Pro Rata basis to
the Holders of the Securities in exchange for such Securities.
(b) If, upon any such Liquidation, the Liquidation Distribution can be
paid only in part because the Trust has insufficient assets available to pay in
full the aggregate Liquidation Distribution, then the amounts payable directly
by the Trust on the Securities shall be paid on a Pro Rata basis. The Holders of
the Common Securities will be entitled to receive distributions upon any such
Liquidation Pro Rata with the Holders of the Capital Securities except that if
an Indenture Event of Default has occurred and is continuing, the Capital
Securities shall have a preference over the Common Securities with regard to
such distributions.
ARTICLE 9
LIMITATION OF LIABILITY OF
HOLDERS OF SECURITIES, TRUSTEES OR OTHERS
Section 9.1 Liability.
(a) Except as expressly set forth in this Declaration, the Guarantee
and the terms of the Securities, the Sponsor and the Holder of the Common
Securities:
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(i) shall not be personally liable for the return of any portion of
the capital contributions (or any return thereon) of the Holders
of the Securities which shall be made solely from assets of the
Trust; and
(ii) shall not be required to pay to the Trust or to any Holder of
Securities any deficit upon dissolution of the Trust or otherwise.
(b) The Holder of the Common Securities shall be liable for all of the
debts and obligations of the Trust (other than with respect to the Securities)
to the extent not satisfied out of the Trust's assets.
(c) Pursuant to Section 3803(a) of the Business Trust Act, the Holders
of the Capital Securities shall be entitled to the same limitation of personal
liability extended to stockholders of private corporations for profit organized
under the General Corporation Law of the State of Delaware.
Section 9.2 Exculpation.
(a) No Indemnified Person shall be liable, responsible or accountable
in damages or otherwise to the Trust or any Covered Person for any loss, damage
or claim incurred by reason of any act or omission performed or omitted by such
Indemnified Person in good faith on behalf of the Trust and in a manner such
Indemnified Person reasonably believed to be within the scope of the authority
conferred on such Indemnified Person by this Declaration or by law, except that
an Indemnified Person shall be liable or any such loss, damage or claim incurred
by reason of such Indemnified Person's negligence or willful misconduct with
respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying in good
faith upon the records of the Trust and upon such information, opinions, reports
or statements presented to the Trust by any Person as to matters the Indemnified
Person reasonably believes are within such other Person's professional or expert
competence and who has been selected with reasonable care by or on behalf of the
Trust, including information, opinions, reports or statements as to the value
and amount of the assets, liabilities, profits, losses or any other facts
pertinent to the existence and amount of assets from which Distributions to
Holders of Securities might properly be paid.
Section 9.3 Fiduciary Duty.
(a) To the extent that, at law or in equity, an Indemnified Person has
duties (including fiduciary duties) and liabilities relating thereto to the
Trust or to any other Covered Person, an Indemnified Person acting under this
Declaration shall not be liable to the Trust or to any other Covered Person for
its good faith reliance on the provisions of this Declaration. The provisions of
this Declaration, to the extent that they restrict the duties and liabilities of
an Indemnified Person otherwise existing at law or in equity (other than the
duties imposed on the Property Trustee under the Trust Indenture Act), are
agreed by the parties hereto to replace such other duties and liabilities of
such Indemnified Person.
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(b) Unless otherwise expressly provided herein:
(i) whenever a conflict of interest exists or arises between any
Covered Persons; or
(ii) whenever this Declaration or any other agreement contemplated
herein or therein provides that an Indemnified Person shall act in
a manner that is, or provide terms that are, fair and reasonable
to the Trust or any Holder of Securities,
the Indemnified Person shall resolve such conflict of interest, take such action
or provide such terms, considering in each case the relative interest of each
party (including its own interest) to such conflict, agreement, transaction or
situation and the benefits and burdens relating to such interests, any customary
or accepted industry practices and any applicable generally accepted accounting
practices or principles. In the absence of bad faith by the Indemnified Person,
the resolution, action or term so made, taken or provided by the Indemnified
Person shall not constitute a breach of this Declaration or any other agreement
contemplated herein or of any duty or obligation of the Indemnified Person at
law or in equity or otherwise.
(c) Whenever in this Declaration an Indemnified Person is permitted or
required to make a decision:
(i) in its "discretion" or under a grant of similar authority, the
Indemnified Person shall be entitled to consider such interests
and factors as it desires, including its own interests, and shall
have no duty or obligation to give any consideration to any
interest of or factors affecting the Trust or any other Person; or
(ii) in its "good faith" or under another express standard, the
Indemnified Person shall act under such express standard and shall
not be subject to any other or different standard imposed by this
Declaration or by applicable law.
Section 9.4 Indemnification.
(a)(i) The Debenture Issuer shall indemnify, to the full extent
permitted by law, any Debenture Issuer Indemnified Person who was or is a party
or is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the Trust) by reason
of the fact that he is or was a Debenture Issuer Indemnified Person against
expenses (including attorney fees), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the Trust,
and, with respect to any criminal action or proceeding, had no reasonable cause
to believe his conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction or upon a plea of nolo
contendere or its equivalent, shall not, of itself, create a presumption that
the Debenture Issuer Indemnified Person did not
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act in good faith and in a manner which he reasonably believed to be in or not
opposed to the best interests of the Trust, and, with respect to any criminal
action or proceeding, had reasonable cause to believe that his conduct was
unlawful.
(ii) The Debenture Issuer shall indemnify, to the full extent permitted
by law, any Debenture Issuer Indemnified Person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the Trust to procure a judgment in its favor by
reason of the fact that he is or was a Debenture Issuer Indemnified Person
against expenses (including attorneys' fees) actually and reasonably incurred by
him in connection with the defense or settlement of such action or suit if he
acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the Trust and except that no such
indemnification shall be made in respect of any claim, issue or matter as to
which such Debenture Issuer Indemnified Person shall have been adjudged to be
liable to the Trust unless and only to the extent that the Court of Chancery of
Delaware or the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which such Court of Chancery or such other court
shall deem proper.
(iii) Any indemnification under paragraphs (i) and (ii) of this Section
9.4(a) (unless ordered by a court) shall be made by the Debenture Issuer only as
authorized in the specific case upon a determination that indemnification of the
Debenture Issuer Indemnified Person is proper in the circumstances because he
has met the applicable standard of conduct set forth in paragraphs (i) and (ii).
Such determination shall be made (1) by the Regular Trustees by a majority vote
of a quorum consisting of such Regular Trustees who were not parties to such
action, suit or proceeding, (2) if such a quorum is not obtainable, or, even if
obtainable, if a quorum of disinterested Regular Trustees so directs, by
independent legal counsel in a written opinion, or (3) by the Common Security
Holder of the Trust.
(iv) Expenses (including attorneys' fees) incurred by a Debenture
Issuer Indemnified Person in defending a civil, criminal, administrative or
investigative action, suit or proceeding referred to in paragraphs (i) and (ii)
of this Section 9.4(a) shall be paid by the Debenture Issuer in advance of the
final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such Debenture Issuer Indemnified Person to repay
such amount if it shall ultimately be determined that he is not entitled to be
indemnified by the Debenture Issuer as authorized in this Section 9.4(a).
Notwithstanding the foregoing, no advance shall be made by the Debenture Issuer
if a determination is reasonably and promptly made (i) by the Regular Trustees
by a majority vote of a quorum of disinterested Regular Trustees, (ii) if such a
quorum is not obtainable, or, even if obtainable, if a quorum of disinterested
Regular Trustees so directs, by independent legal counsel in a written opinion
or (iii) the Common Security Holder of the Trust, that, based upon the facts
known to the Regular Trustees, counsel or the Common Security Holder at the time
such determination is made, such Debenture Issuer Indemnified Person acted in
bad faith or in a manner that such person did not believe to be in or not
opposed to the best interests of the Trust, or, with respect to any criminal
proceeding, that such Debenture Issuer Indemnified Person believed or had
reasonable cause to believe his conduct was unlawful. In no event shall any
advance be
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made in instances where the Regular Trustees, independent legal counsel or
Common Security Holder reasonably determine that such person deliberately
breached his duty to the Trust or its Common or Capital Security Holders.
(v) The indemnification and advancement of expenses provided by, or
granted pursuant to, the other paragraphs of this Section 9.4(a) shall not be
deemed exclusive of any other rights to which those seeking indemnification and
advancement of expenses may be entitled under any agreement, vote of
stockholders or disinterested directors of the Debenture Issuer or Capital
Security Holders of the Trust or otherwise, both as to action in his official
capacity and as to action in another capacity while holding such office. All
rights to indemnification under this Section 9.4(a) shall be deemed to be
provided by a contract between the Debenture Issuer and each Debenture Issuer
Indemnified Person who serves in such capacity at any time while this Section
9.4(a) is in effect. Any repeal or modification of this Section 9.4(a) shall not
affect any rights or obligations then existing.
(vi) The Debenture Issuer or the Trust may purchase and maintain
insurance on behalf of any person who is or was a Debenture Issuer Indemnified
Person against any liability asserted against him and incurred by him in any
such capacity, or arising out of his status as such, whether or not the
Debenture Issuer would have the power to indemnify him against such liability
under the provisions of this Section 9.4(a).
(vii) For purposes of this Section 9.4(a), references to "the Trust"
shall include, in addition to the resulting or surviving entity, any constituent
entity (including any constituent of a constituent) absorbed in a consolidation
or merger, so that any person who is or was a director, trustee, officer or
employee of such constituent entity, or is or was serving at the request of such
constituent entity as a director, trustee, officer, employee or agent of another
entity, shall stand in the same position under the provisions of this Section
9.4(a) with respect to the resulting or surviving entity as he would have with
respect to such constituent entity if its separate existence had continued.
(viii) The indemnification and advancement of expenses provided by, or
granted pursuant to, this Section 9.4(a) shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a Debenture
Issuer Indemnified Person and shall inure to the benefit of the heirs, executors
and administrators of such a person. The obligation to indemnify as set forth in
this Section 9.4(a) shall survive the satisfaction and discharge of this
Declaration.
(b) The Debenture Issuer agrees to indemnify the (i) Property Trustee,
(ii) the Delaware Trustee, (iii) an Affiliate of the Property Trustee and the
Delaware Trustee, and (iv) any officers, directors, shareholders, members,
partners, employees, representatives, custodians, nominees or agents of the
Property Trustee and the Delaware Trustee (each of the Persons in (i) through
(iv) being referred to as a "Fiduciary Indemnified Person") for, and to hold
each Fiduciary Indemnified Person harmless against, any loss, liability or
expense incurred without negligence or bad faith on its part, arising out of or
in connection with the acceptance or administration of the trust or trusts
hereunder, including the costs and expenses (including reasonable legal fees and
expenses) of defending itself against or investigating any
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claim or liability in connection with the exercise or performance of any of its
powers or duties hereunder. The obligation to indemnify as set forth in this
Section 9.4(a) shall survive the satisfaction and discharge of this Declaration.
Section 9.5 Outside Businesses.
Any Covered Person, the Sponsor and any Trustee may engage in or
possess an interest in other business ventures of any nature or description,
independently or with others, similar or dissimilar to the activities of the
Trust, and the Trust and the Holders of Securities shall have no rights by
virtue of this Declaration in and to such independent ventures or the income or
profits derived therefrom, and the pursuit of any such venture, even if
competitive with the activities of the Trust, shall not be deemed wrongful or
improper. No Covered Person, the Sponsor or any Trustee shall be obligated to
present any particular investment or other opportunity to the Trust even if such
opportunity is of a character that, if presented to the Trust, could be taken by
the Trust, and any Covered Person, the Sponsor and any Trustee shall have the
right to take for its own account (individually or as a partner or fiduciary) or
to recommend to others any such particular investment or other opportunity. Any
Covered Person and any Trustee may engage or be interested in any financial or
other transaction with the Sponsor or any Affiliate of the Sponsor, or may act
as depositary for, trustee or agent for, or act on any committee or body of
holders of, securities or other obligations of the Sponsor or its Affiliates.
ARTICLE 10
ACCOUNTING
Section 10.1 Fiscal Year.
The fiscal year ("Fiscal Year") of the Trust shall be the calendar
year, or such other year as is required by the Code.
Section 10.2 Certain Accounting Matters.
(a) At all times during the existence of the Trust, the Regular
Trustees shall keep, or cause to be kept, full books of account, records and
supporting documents, which shall reflect in reasonable detail, each transaction
of the Trust. The books of account shall be maintained on the accrual method of
accounting, in accordance with generally accepted accounting principles. The
Trust shall use the accrual method of accounting for United States federal
income tax purposes.
(b) The Regular Trustees shall cause to be duly prepared and delivered
to each of the Holders of Securities, an annual United States federal income tax
information statement, required by the Code, containing such information with
regard to the Securities held by each Holder as is required by the Code and the
Treasury Regulations. Notwithstanding any right under the Code to deliver any
such statement at a later date, the Regular Trustees shall
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endeavor to deliver all such statements within 30 days after the end of each
Fiscal Year of the Trust.
(c) The Regular Trustees shall cause to be duly prepared and filed with
the appropriate taxing authority, an annual United States federal income tax
return, on a Form 1041 or such other form required by United States federal
income tax law, and any other annual income tax returns required to be filed by
the Regular Trustees on behalf of the Trust with any state or local taxing
authority.
Section 10.3 Banking.
The Trust shall maintain one or more bank accounts in the name and for
the sole benefit of the Trust; provided, however, that all payments of funds in
respect of the Debentures held by the Property Trustee shall be made directly to
the Property Account and no other funds of the Trust shall be deposited in the
Property Account. The sole signatories for such accounts shall be designated by
the Regular Trustees; provided, however, that the Property Trustee shall
designate the signatories for the Property Account.
Section 10.4 Withholding.
The Trust and the Regular Trustees shall comply with all withholding
requirements under United States federal, state and local law. The Trust shall
request, and the Holders shall provide to the Trust, such forms or certificates
as are necessary to establish an exemption from withholding with respect to each
Holder, and any representations and forms as shall reasonably be requested by
the Trust to assist it in determining the extent of, and in fulfilling, its
withholding obligations. The Regular Trustees shall file required forms with
applicable jurisdictions and, unless an exemption from withholding is properly
established by a Holder, shall remit amounts withheld with respect to the Holder
to applicable jurisdictions. To the extent that the Trust is required to
withhold and pay over any amounts to any authority with respect to distributions
or allocations to any Holder, the amount withheld shall be deemed to be a
distribution in the amount of the withholding to the Holder. In the event of any
claimed over withholding, Holders shall be limited to an action against the
applicable jurisdiction. If the amount required to be withheld was not withheld
from actual Distributions made, the Trust may reduce subsequent Distributions by
the amount of such withholding.
ARTICLE 11
AMENDMENTS AND MEETINGS
Section 11.1 Amendments.
(a) Except as otherwise provided in this Declaration or by any
applicable terms of the Securities, this Declaration may only be amended by a
written instrument approved and executed by (i) the Regular Trustees (or, if
there are more than two Regular Trustees, a majority of the Regular Trustees)
and (ii) by the Property Trustee if the amendment affects the
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rights, powers, duties, obligations or immunities of the Property Trustee; (iii)
by the Delaware Trustee if the amendment affects the rights, powers, duties,
obligations or immunities of the Delaware Trustee; and (iv) the Sponsor.
(b) No amendment shall be made, and any such purported amendment shall
be void and ineffective:
(i) unless, in the case of any proposed amendment, the Property
Trustee shall have first received an Officers' Certificate from
each of the Trust and the Sponsor that such amendment is permitted
by, and conforms to, the terms of this Declaration (including the
terms of the Securities);
(ii) unless, in the case of any proposed amendment which affects the
rights, powers, duties, obligations or immunities of the Property
Trustee, the Property Trustee shall have first received:
a. an Officers' Certificate from each of the Trust and the
Sponsor that such amendment is permitted by, and conforms to,
the terms of this Declaration (including the terms of the
Securities); and
b. an opinion of counsel (who may be counsel to the Sponsor or
the Trust) that such amendment is permitted by, and conforms
to, the terms of this Declaration (including the terms of the
Securities); and
(iii) to the extent the result of such amendment would be to:
a. cause the Trust to be classified other than as a grantor
trust for United States federal income tax purposes;
b. reduce or otherwise adversely affect the powers of the
Property Trustee in contravention of the Trust Indenture Act;
or
c. cause the Trust to be deemed to be an Investment Company
required to be registered under the Investment Company Act.
(c) At such time after the Trust has issued any Securities that remain
outstanding, if the amendment would (i) adversely affect the powers, preferences
or special rights of the Securities, whether by way of amendment to the
Declaration or otherwise or (ii) result in the dissolution, winding-up or
termination of the Trust other than pursuant to the terms of this Declaration
or, (iii) change the amount or timing of any distribution of the Securities or
otherwise adversely affect the amount of any distribution required to be made in
respect of the Securities as of a specified date or (iv) restrict the right of a
Holder of Securities to institute suit for the enforcement of any such payment
on or after such date, then the Holders of the Securities voting together as a
single class will be entitled to vote on such amendment or proposal and such
amendment or proposal shall not be effective except with the approval of at
least a Majority in Liquidation Amount of the Securities affected thereby;
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provided that, if any amendment or proposal referred to in clause (i) above
would adversely affect only the Capital Securities or the Common Securities,
then only the affected class will be entitled to vote on such amendment or
proposal and such amendment or proposal shall not be effective except with the
approval of a Majority in Liquidation Amount of such class of Securities.
(d) Section 7.8 and this Section 11.1 shall not be amended without the
consent of all of the Holders of the Securities.
(e) Article 4 shall not be amended without the consent of the Holders
of a Majority in Liquidation Amount of the Common Securities.
(f) The rights of the Holders of the Common Securities under Article 6
to increase or decrease the number of, and appoint and remove Trustees shall not
be amended without the consent of the Holders of a Majority in Liquidation
Amount of the Common Securities.
(g) Notwithstanding Section 11.1(c), this Declaration may be amended by
the holders of a majority of the Common Securities and the Regular Trustees,
without the consent of the Holders of the Securities:
(i) to cure any ambiguity, correct or supplement any provisions in
this Declaration that may be inconsistent with any other
provision, or to make any other provisions with respect to matters
or questions arising under this Declaration that shall not be
inconsistent with the other provisions of this Declaration;
(ii) to modify, eliminate or add to any provisions of this Declaration
to such extent as shall be necessary to ensure that the Trust will
be classified as a grantor trust and will not be taxable as a
corporation for United States federal income tax purposes at all
times that any Securities are outstanding or to ensure that the
Trust will not be required to register as an "investment company"
under the Investment Company Act; or
(iii) to conform to any change in Rule 3a-7 under the Investment
Company Act or written change in interpretation or application of
such Rule 3a-7 by any legislative body, court, government agency
or regulatory authority which amendment does not have a material
adverse effect on the rights, preferences or privileges of the
Holders.
provided, however, that such action shall not adversely affect in any material
respect the interests of any Holder of Capital Securities or Common Securities,
and any amendments of this Declaration shall become effective when notice
thereof is given to the Holders of Capital Securities and Common Securities.
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(h) The issuance of a Trustees' Authorization Certificate by the
Regular Trustees for purposes of establishing the terms and form of the
Securities as contemplated by Section 8.1 shall not be deemed an amendment of
this Declaration subject to the provisions of this Section 11.1.
(i) Notwithstanding any provision of this Declaration, the right of any
Holder of Trust Securities to receive payment of Distributions and other
payments upon redemption or otherwise, on or after their respective due dates,
or to institute a suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of such
Holder. For the protection and enforcement of the foregoing provision, each and
every Holder of Trust Securities shall be entitled to such relief as can be
given either at law or equity.
Section 11.2 Meetings of the Holders of Securities; Action by Written
Consent.
(a) Meetings of the Holders of any class of Securities may be called at
any time by the Regular Trustees (or as provided in the terms of the Securities)
to consider and act on any matter on which Holders of such class of Securities
are entitled to act under the terms of this Declaration, the terms of the
Securities or the rules of any stock exchange on which the Capital Securities
are listed or admitted for trading, if any. The Regular Trustees shall call a
meeting of the Holders of such class if directed to do so by the Holders of at
least 10% in Liquidation Amount of such class of Securities. Such direction
shall be given by delivering to the Regular Trustees one or more calls in a
writing stating that the signing Holders of Securities wish to call a meeting
and indicating the general or specific purpose for which the meeting is to be
called. Any Holders of Securities calling a meeting shall specify in writing the
Certificates held by the Holders of Securities exercising the right to call a
meeting and only those Securities specified shall be counted for purposes of
determining whether the required percentage set forth in the second sentence of
this paragraph has been met.
(b) Except to the extent otherwise provided in the terms of the
Securities, the following provisions shall apply to meetings of Holders of
Securities:
(i) notice of any such meeting shall be given to all the Holders of
Securities having a right to vote thereat at least 7 days and not
more than 60 days before the date of such meeting. Whenever a
vote, consent or approval of the Holders of Securities is
permitted or required under this Declaration or the rules of any
stock exchange on which the Capital Securities are listed or
admitted for trading, if any, such vote, consent or approval may
be given at a meeting of the Holders of Securities. Any action
that may be taken at a meeting of the Holders of Securities may be
taken without a meeting if a consent in writing setting forth the
action so taken is signed by the Holders of Securities owning not
less than the minimum amount of Securities in liquidation amount
that would be necessary to authorize or take such action at a
meeting at which all Holders of Securities having a right to vote
thereon were present and voting. Prompt notice of the taking of
action without a meeting shall be given to the Holders of
Securities entitled to vote who have
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not consented in writing. The Regular Trustees may specify that
any written ballot submitted to the Security Holders for the
purpose of taking any action without a meeting shall be returned
to the Trust within the time specified by the Regular Trustees;
(ii) each Holder of a Security may authorize any Person to act for it
by proxy on all matters in which a Holder of Securities is
entitled to participate, including waiving notice of any meeting,
or voting or participating at a meeting. No proxy shall be valid
after the expiration of 11 months from the date thereof unless
otherwise provided in the proxy. Every proxy shall be revocable at
the pleasure of the Holder of Securities executing such proxy.
Except as otherwise provided herein, all matters relating to the
giving, voting or validity of proxies shall be governed by the
General Corporation Law of the State of Delaware relating to
proxies, and judicial interpretations thereunder, as if the Trust
were a Delaware corporation and the Holders of the Securities were
stockholders of a Delaware corporation;
(iii) each meeting of the Holders of the Securities shall be conducted
by the Regular Trustees or by such other Person that the Regular
Trustees may designate; and
(iv) consistent with the Business Trust Act, this Declaration, the
terms of the Securities, the Trust Indenture Act or the listing
rules of any stock exchange on which the Capital Securities are
then listed for trading, otherwise provides, the Regular Trustees,
in their sole discretion, shall establish all other provisions
relating to meetings of Holders of Securities, including notice of
the time, place or purpose of any meeting at which any matter is
to be voted on by any Holders of Securities, waiver of any such
notice, action by consent without a meeting, the establishment of
a record date, quorum requirements, voting in person or by proxy
or any other matter with respect to the exercise of any such right
to vote.
ARTICLE 12
REPRESENTATIONS OF PROPERTY TRUSTEE
AND DELAWARE TRUSTEE
Section 12.1 Representations and Warranties of the Property Trustee.
The Trustee that acts as initial Property Trustee represents and
warrants to the Trust and to the Sponsor at the date of this Declaration, and
each Successor Property Trustee represents and warrants to the Trust and the
Sponsor at the time of the Successor Property Trustee's acceptance of its
appointment as Property Trustee that:
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(a) the Property Trustee is a corporation or bank duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
incorporation or organization, with trust power and authority to execute and
deliver, and to carry out and perform its obligations under the terms of, this
Declaration;
(b) the Property Trustee satisfies the requirements set forth in
Section 6.3(a);
(c) the execution, delivery and performance by the Property Trustee of
this Declaration has been duly authorized by all necessary corporate action on
the part of the Property Trustee. This Declaration has been duly executed and
delivered by the Property Trustee, and it constitutes a legal, valid and binding
obligation of the Property Trustee, enforceable against it in accordance with
its terms, subject to applicable bankruptcy, reorganization, moratorium,
insolvency and other similar laws affecting creditors' rights generally and to
general principles of equity and the discretion of the court (regardless of
whether the enforcement of such remedies is considered in a proceeding in equity
or at law);
(d) the execution, delivery and performance of this Declaration by the
Property Trustee does not conflict with or constitute a breach of the articles
of association or incorporation, as the case may be, or the by-laws (or other
similar organizational documents) of the Property Trustee; and
(e) no consent, approval or authorization of, or registration with or
notice to, any State or Federal banking authority is required for the execution,
delivery or performance by the Property Trustee of this Declaration.
Section 12.2 Representations and Warranties of the Delaware Trustee.
The Trustee that acts as initial Delaware Trustee represents and
warrants to the Trust and to the Sponsor at the date of this Declaration, and
each Successor Delaware Trustee represents and warrants to the Trust and the
Sponsor at the time of the Successor Delaware Trustee's acceptance of its
appointment as Delaware Trustee that:
(a) the Delaware Trustee satisfies the requirements set forth in
Section 6.2 and has the power and authority to execute and deliver, and to carry
out and perform its obligations under the terms of, this Declaration and, if it
is not a natural person, is duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation or organization;
(b) the Delaware Trustee has been authorized to perform its obligations
under the Certificate of Trust and this Declaration. This Declaration under
Delaware law constitutes a legal, valid and binding obligation of the Delaware
Trustee, enforceable against it in accordance with its terms, subject to
applicable bankruptcy, reorganization, moratorium, insolvency and other similar
laws affecting creditors' rights generally and to general principles of equity
and the discretion of the court (regardless of whether the enforcement of such
remedies is considered in a proceeding in equity or at law); and
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(c) no consent, approval or authorization of, or registration with or
notice to, any State or Federal banking authority is require for the execution,
delivery or performance by the Delaware Trustee of this Declaration.
ARTICLE 13
MISCELLANEOUS
Section 13.1 Notices.
All notices provided for in this Declaration shall be in writing, duly
signed by the party giving such notice, and shall be delivered, telecopied or
mailed by registered or certified mail, as follows:
(a) if given to the Trust, in care of the Regular Trustees at the
Trust's mailing address set forth below (or such other address as the Trust may
give notice of to the Property Trustee, the Delaware Trustee and the Holders of
the Securities):
c/o Huntington Bancshares Incorporated
Huntington Center
41 South High Street
Columbus, Ohio 43287
(b) if given to the Delaware Trustee, at the mailing address set forth
below (or such other address as the Delaware Trustee may give notice of to the
Regular Trustees, the Property Trustee and the Holders of the Securities):
Chase Manhattan Bank Delaware
801 Delaware Avenue, 13th Floor
Wilmington, DE 19801
(c) if given to the Property Trustee, at its Corporate Trust Office (or
such other address as the Property Trustee may give notice of to the Regular
Trustees, the Delaware Trustee and the Holders of the Securities):
The Chase Manhattan Bank
450 W. 33rd Street, 15th Floor
New York, NY 10001-2697
(d) if given to the Sponsor, at the mailing address set forth below (or
such other address as the Sponsor may give notice of to the Property Trustee,
the Delaware Trustee and the Trust):
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Huntington Bancshares Incorporated
Huntington Center
41 South High Street
Columbus, Ohio 43287
Attn: Judith D. Fisher
(e) if given to any Holder, at the address set forth on the books and
records of the Trust.
All such notices shall be deemed to have been given when received in person,
telecopied with receipt confirmed or on the seventh day after being mailed by
first class mail, postage prepaid except that if a notice or other document is
refused delivery or cannot be delivered because of a changed address of which no
notice was given, such notice or other document shall be deemed to have been
delivered on the date of such refusal or inability to deliver. If so required by
the Luxembourg Stock Exchange, notice to any holder shall also be given by
publication in a leading newspaper having general circulation in Luxembourg and,
in the event notice is also mailed, notice shall be deemed to have been given on
the later of the date of publication and the seventh day after being mailed.
Section 13.2 Governing Law.
This Declaration and the rights of the parties hereunder shall be
governed by and interpreted in accordance with the laws of the State of Delaware
without regard to the principles of conflict of laws.
Section 13.3 Intention of the Parties.
It is the intention of the parties hereto that the Trust be classified
for United States federal income tax purposes as a grantor trust. The provisions
of this Declaration shall be interpreted in a manner consistent with such
classification.
Section 13.4 Headings.
Headings contained in this Declaration are inserted for convenience of
reference only and do not affect the interpretation of this Declaration or any
provision hereof.
Section 13.5 Successors and Assigns.
Whenever in this Declaration any of the parties hereto is named or
referred to, the successors and assigns of such party shall be deemed to be
included, and all covenants and agreements in this Declaration by the Sponsor
and the Trustees shall bind and inure to the benefit of their respective
successors and assigns, whether so expressed.
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70
Section 13.6 Partial Enforceability.
If any provision of this Declaration, or the application of such
provision to any Person or circumstance, shall be held invalid, the remainder of
this Declaration, or the application of such provision to persons or
circumstances other than those to which it is held invalid, shall not be
affected thereby.
Section 13.7 Counterparts.
This Declaration may contain more than one counterpart of the signature
page and this Declaration may be executed by the affixing of the signature of
each of the Trustees to one of such counterpart signature pages. All of such
counterpart signature pages shall be read as though one, and they shall have the
same force and effect as though all of the signers had signed a single signature
page.
Section 13.8 Undertaking for Costs.
In any suit for the enforcement of any right or remedy under this
Declaration or in any suit against any Trustee for any action taken or omitted
by it as a Trustee, a court in its discretion may require the filing by any
party litigant in the suit of an undertaking to pay the costs of the suit, and
the court in its discretion may assess reasonable costs, including reasonable
attorney's fees and expenses, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section 13.8 does not apply to a suit by a Trustee, a suit by a
Holder to enforce its right to payment or a suit by Holders of more than 10% in
Liquidation Amount of the then outstanding Securities.
<PAGE> 74
71
IN WITNESS WHEREOF, the undersigned have caused these presents to be
executed as of the day and year first above written.
HUNTINGTON BANCSHARES
INCORPORATED,
as Sponsor and Common Securities Holder
BY: /s/ JUDITH D. FISHER
-------------------------------------
Name: Judith D. Fisher
Title: Executive Vice President
THE CHASE MANHATTAN BANK,
as Property Trustee
BY: /s/ TIMOTHY E. BURKE
-------------------------------------
Name: Timothy E. Burke
Title: Second Vice President
CHASE MANHATTAN BANK DELAWARE,
as Delaware Trustee
BY: /s/ JOHN J. CASHIN
-------------------------------------
Name: John J. Cashin
Title: Senior Trust Officer
Milton D. Baughman, as Regular Trustee
By: /s/ MILTON D. BAUGHMAN
-------------------------------------
Name: Milton D. Baughman
Title: Regular Trustee
Beth A. Russell, as Regular Trustee
By: /s/ BETH A. RUSSELL
-------------------------------------
Name: Beth A. Russell
Title: Regular Trustee
Paul V. Sebert, as Regular Trustee
By: /s/ PAUL V. SEBERT
-------------------------------------
Name: Paul V. Sebert
Title: Regular Trustee
<PAGE> 75
EXHIBIT A-1
THIS CAPITAL SECURITY (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY STATE
SECURITIES LAWS AND NEITHER THIS CAPITAL SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF THIS CAPITAL SECURITY IS HEREBY NOTIFIED THAT THE SELLER MAY BE
RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT
PROVIDED BY RULE 144A, REGULATION S OR ANOTHER EXEMPTION THEREUNDER. THE HOLDER
OF THIS CAPITAL SECURITY, BY ITS ACCEPTANCE HEREOF, REPRESENTS, ACKNOWLEDGES AND
AGREES FOR THE BENEFIT OF THE TRUST THAT: (I) IT HAS ACQUIRED A "RESTRICTED"
SECURITY WHICH HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT; (II) IT WILL
NOT OFFER, SELL OR OTHERWISE TRANSFER THIS CAPITAL SECURITY PRIOR TO THE LATER
OF THE DATE WHICH IS THREE YEARS AFTER THE DATE OF ORIGINAL ISSUANCE HEREOF AND
THE LAST DATE ON WHICH THE TRUST OR ANY AFFILIATE OF THE TRUST WAS THE OWNER OF
SUCH RESTRICTED SECURITIES (OR ANY PREDECESSOR) EXCEPT (A) TO THE TRUST, (B)
PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT, (C) FOR SO LONG AS THIS CAPITAL SECURITY IS ELIGIBLE FOR RESALE
PURSUANT TO RULE 144A, TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES
ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (D) OUTSIDE THE
UNITED STATES IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 904 UNDER THE
SECURITIES ACT, (E) TO AN INSTITUTIONAL "ACCREDITED INVESTOR," WITHIN THE
MEANING OF SUBPARAGRAPH (A)(1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES
ACT THAT IS ACQUIRING THE SECURITIES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF
SUCH AN INSTITUTIONAL "ACCREDITED INVESTOR," FOR INVESTMENT PURPOSES AND NOT
WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN
VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND, IN EACH CASE, IN
ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES
OR ANY APPLICABLE JURISDICTION; AND (III) IT WILL, AND EACH SUBSEQUENT HOLDER IS
REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THIS CAPITAL SECURITY OF THE RESALE
RESTRICTIONS SET FORTH IN (II) ABOVE. ANY OFFER, SALE OR OTHER DISPOSITION
PURSUANT TO THE FOREGOING CLAUSES (II)(D), (E) AND (F) IS SUBJECT TO THE RIGHT
OF THE ISSUER OF THIS CAPITAL SECURITY AND THE PROPERTY TRUSTEE FOR SUCH CAPITAL
SECURITIES TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATIONS OR
OTHER INFORMATION ACCEPTABLE TO THEM IN FORM AND SUBSTANCE.
This Capital Security is a Global Certificate within the meaning of the
Declaration hereinafter referred to and is registered in the name of The
Depository Trust Company, a New York corporation (the "Depositary"), or a
nominee of the Depositary. This
A-1-1
<PAGE> 76
Capital Security is exchangeable for Capital Securities registered in the name
of a person other than the Depositary or its nominee only in the limited
circumstances described in the Declaration and no transfer of this Capital
Security (other than a transfer of this Capital Security as a whole by the
Depositary to a nominee of the Depositary or by a nominee of the Depositary to
the Depositary or another nominee of the Depositary) may be registered except in
limited circumstances.
Unless this Capital Security Certificate is presented by an authorized
representative of the Depositary to Huntington Capital I or its agent for
registration of transfer, exchange or payment, and any Capital Security
Certificate issued is registered in the name of Cede & Co. or such other name as
registered by an authorized representative of the Depositary (and any payment
hereon is made to Cede & Co. or to such other entity as is requested by an
authorized representative of the Depositary), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the
registered owner hereof, Cede & Co., has an interest herein.
CERTIFICATE NO. CUSIP NO.
AGGREGATE LIQUIDATION AMOUNT OF CAPITAL SECURITIES: $[__],000,000
Certificate Evidencing Capital Securities
of
Huntington Capital I
Floating Rate Capital Securities
(liquidation amount $1,000 per Capital Security)
HUNTINGTON CAPITAL I, a statutory business trust formed under the laws
of the State of Delaware (the "Trust"), hereby certifies that Cede & Co. (the
"Holder") is the registered owner of capital securities in the aggregate
liquidation amount of $[__],000,000 of the Trust representing undivided
beneficial interests in the assets of the Trust designated the Floating Rate
Capital Securities (liquidation amount $1,000 per Capital Security) (the
"Capital Securities"). The Capital Securities are transferable on the books and
records of the Trust, in person or by a duly authorized attorney, upon surrender
of this certificate duly endorsed and in proper form for transfer as provided in
the Declaration (as defined below). The designation, rights, privileges,
restrictions, preferences and other terms and provisions of the Capital
Securities represented hereby are issued and shall in all respects be subject to
the provisions of the Amended and Restated Declaration of Trust of the Trust,
dated as of January 31, 1997 (as the same may be amended from time to time (the
"Declaration"), among Huntington Bancshares Incorporated, as Sponsor (the
"Company"), Milton D. Baughman, Beth A. Russell and Paul V. Sebert, as Regular
Trustees, The Chase Manhattan Bank, as Property Trustee, and Chase Manhattan
Bank Delaware, as Delaware Trustee. Capitalized terms used herein but not
defined shall have the meaning given them in the Declaration. The Holder is
entitled to the benefits of the Guarantee to the extent described therein. The
Sponsor will provide a copy of the Declaration, the Guarantee and the Indenture
to a Holder without charge upon written request to the Sponsor at its principal
place of business.
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
A-1-2
<PAGE> 77
By acceptance, the Holder agrees to treat, for United States federal
income tax purposes, the Debentures as indebtedness and the Capital Securities
as evidence of undivided indirect beneficial interests in the Debentures.
This Capital Security shall be governed by and interpreted in
accordance with the laws of the State of Delaware.
IN WITNESS WHEREOF, the Trust has executed this certificate this 31st
day of January, 1997.
HUNTINGTON CAPITAL I
By:___________________________
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This is one of the Securities referred to in the within-mentioned
Declaration.
THE CHASE MANHATTAN BANK
By:___________________________
Authorized Signatory
A-1-3
<PAGE> 78
In connection with any transfer of this Security occurring prior to the
date which is the earlier of (i) the date of the declaration by the Commission
of the effectiveness of a registration statement under the Securities Act
covering resales of this Security (which effectiveness shall not have been
suspended or terminated at the date of the transfer) and (ii) three years after
the later of the date of original issue and the last date on which the Company
or any affiliate of the Company was the owner of such Capital Securities (or any
predecessor thereto) (the "Resale Restriction Termination Date"), the
undersigned confirms that it has not utilized any general solicitation or
general advertising in connection with the transfer:
[CHECK ONE]
(1) ___ to the Company or a subsidiary thereof; or
(2) ___ pursuant to and in compliance with Rule 144A under the Securities
Act of 1933, as amended; or
(3) ___ to an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as
amended) that has furnished to the Trustee a signed letter
containing certain representations and agreements (the form of which
letter can be obtained from the Trustee); or
(4) ___ outside the United States to a "foreign person" in compliance with
Rule 904 of Regulation S under the Securities Act of 1933, as
amended; or
(5) ___ pursuant to the exemption from registration provided by Rule 144
under the Securities Act of 1933, as amended; or
(6) ___ pursuant to an effective registration statement under the Securities
Act of 1933, as amended; or
(7) ___ pursuant to another available exemption from the registration
requirements of the Securities Act of 1933, as amended.
Unless one of the boxes is checked, the Trustee will refuse to register any of
the Securities evidenced by this certificate in the name of any person other
than the registered Holder thereof; provided, however, that if box (3), (4), (5)
or (7) is checked, the Company or the Trustee may require, prior to registering
any such transfer of the Securities, in its sole discretion, such written legal
opinions, certifications (including an investment letter in the case of box (3)
or (4)) and other information as the Trustee or the Company has reasonably
requested to confirm that such transfer is being made pursuant to an exemption
from, or in a transaction not subject to, the registration requirements of the
Securities Act of 1933, as amended.
A-1-4
<PAGE> 79
If none of the foregoing boxes is checked, the Trustee or Security Registrar
shall not be obligated to register this Security in the name of any person other
than the Holder hereof unless and until the conditions to any such transfer of
registration set forth herein and in Section 315 of the Indenture shall have
been satisfied.
Dated: ______________________
Signed:_________________________________________________________________________
(Sign exactly as name appears on the other side of this Security)
Signature Guarantee:____________
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing this
Security for its own account or an account with respect to which it exercises
sole investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act
and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Company as the
undersigned has requested pursuant to Rule 144A or has determined not to request
such information and that it is aware that the transferor is relying upon the
undersigned's foregoing representations in order to claim the exemption from
registration provided by Rule 144A.
Dated: ____________
_________________________________________________________________________
NOTICE: To be executed by an executive officer
A-1-5
<PAGE> 80
EXHIBIT A-2
THIS CERTIFICATE IS NOT TRANSFERABLE
CERTIFICATE NO. NUMBER OF COMMON SECURITIES:
CERTIFICATE EVIDENCING COMMON SECURITIES
OF
HUNTINGTON CAPITAL I
COMMON SECURITIES
(LIQUIDATION AMOUNT $1,000 PER COMMON SECURITY)
Huntington Capital I, a statutory business trust formed under the
laws of the State of Delaware (the "Trust"), hereby certifies that Huntington
Bancshares Incorporated (the "Holder") is the registered owner of common
securities of the Trust representing an undivided beneficial interest in the
assets of the Trust designated the Floating Rate Common Securities (liquidation
amount $1,000 per Common Security) (the "Common Securities"). The Common
Securities are not transferable and any attempted transfer thereof shall be
void. The designation, rights, privileges, restrictions, preferences and other
terms and provisions of the Common Securities represented hereby are issued and
shall in all respects be subject to the provisions of the Amended and Restated
Declaration of Trust of the Trust, dated as of January 31, 1997 (as the same may
be amended from time to time, the "Declaration"), among Huntington Bancshares
Incorporated, as Sponsor, Milton D. Baughman, Beth A. Russell and Paul V.
Sebert, as Regular Trustees, The Chase Manhattan Bank, as Property Trustee and
Chase Manhattan Bank Delaware, as Delaware Trustee. The Holder is entitled to
the benefits of the Guarantee to the extent described therein. Capitalized terms
used herein but not defined shall have the meaning given them in the
Declaration. The Sponsor will provide a copy of the Declaration, the Guarantee
and the Indenture to a Holder without charge upon written request to the Sponsor
at its principal place of business.
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat, for United States federal
income tax purposes, the Debentures as indebtedness and the Common Securities as
evidence of an undivided indirect beneficial interest in the Debentures.
This Common Security shall be governed by and interpreted in
accordance with the laws of the State of Delaware.
A-2-1
<PAGE> 81
IN WITNESS WHEREOF, the Trust has executed this certificate this
31st day of January, 1997.
HUNTINGTON CAPITAL I
By:____________________________________
Name:
Title:
<PAGE> 1
Exhibit 4(d)
FORM OF UNRESTRICTED CERTIFICATE OF CAPITAL SECURITY
----------------------------------------------------
This Capital Security is a Global Certificate within the
meaning of the Declaration hereinafter referred to and is registered in the name
of The Depository Trust Company, a New York corporation (the "Depositary"), or a
nominee of the Depositary. This Capital Security is exchangeable for Capital
Securities registered in the name of a person other than the Depositary or its
nominee only in the limited circumstances described in the Declaration and no
transfer of this Capital Security (other than a transfer of this Capital
Security as a whole by the Depositary to a nominee of the Depositary or by a
nominee of the Depositary to the Depositary or another nominee of the
Depositary) may be registered except in limited circumstances.
Unless this Capital Security Certificate is presented by an
authorized representative of the Depositary to Huntington Capital I or its agent
for registration of transfer, exchange or payment, and any Capital Security
Certificate issued is registered in the name of Cede & Co. or such other name as
registered by an authorized representative of the Depositary (and any payment
hereon is made to Cede & Co. or to such other entity as is requested by an
authorized representative of the Depositary), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the
registered owner hereof, Cede & Co., has an interest herein.
CERTIFICATE NO. ______ CUSIP NO. ___________
AGGREGATE LIQUIDATION AMOUNT OF CAPITAL SECURITIES: $_____________
Certificate Evidencing Capital Securities
of
Huntington Capital I
Floating Rate Capital Securities
(liquidation amount $1,000 per Capital Security)
HUNTINGTON CAPITAL I, a statutory business trust formed under
the laws of the State of Delaware (the "Trust"), hereby certifies that Cede &
Co. (the "Holder") is the registered owner of capital securities in the
aggregate liquidation amount of $____________ of the Trust representing
undivided beneficial interests in the assets of the Trust designated the
Floating Rate Capital Securities (liquidation amount $1,000 per Capital
Security) (the "Capital Securities"). The Capital Securities are transferable on
the books and records of the Trust, in person or by a duly authorized attorney,
upon surrender of this certificate duly endorsed and in proper form for transfer
as provided in the Declaration (as defined below). The designation, rights,
privileges, restrictions, preferences and other terms and provisions of the
Capital Securities represented hereby are issued and shall in all respects be
subject to the provisions of the Amended and Restated Declaration of Trust of
the Trust, dated as of January 31, 1997 (as
<PAGE> 2
the same may be amended from time to time (the "Declaration"), among Huntington
Bancshares Incorporated, as Sponsor (the "Company"), Milton D. Baughman, Beth A.
Russell and Paul V. Sebert, as Regular Trustees, The Chase Manhattan Bank, as
Property Trustee, and Chase Manhattan Bank Delaware, as Delaware Trustee.
Capitalized terms used herein but not defined shall have the meaning given them
in the Declaration. The Holder is entitled to the benefits of the Guarantee to
the extent described therein. The Sponsor will provide a copy of the
Declaration, the Guarantee and the Indenture to a Holder without charge upon
written request to the Sponsor at its principal place of business.
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat, for United States
federal income tax purposes, the Debentures as indebtedness and the Capital
Securities as evidence of undivided indirect beneficial interests in the
Debentures.
This Capital Security shall be governed by and interpreted in
accordance with the laws of the State of Delaware.
IN WITNESS WHEREOF, the Trust has executed this certificate this ____
day of ____________, 199__.
HUNTINGTON CAPITAL I
By:
-----------------------------------
Name:
Title:
CERTIFICATE OF AUTHENTICATION
This is one of the Securities referred to in the within-mentioned
Declaration.
THE CHASE MANHATTAN BANK
By:
-----------------------------------
Authorized Officer
<PAGE> 1
Exhibit 4(e)
- - --------------------------------------------------------------------------------
GUARANTEE AGREEMENT
HUNTINGTON CAPITAL I
DATED AS OF ____________________
- - --------------------------------------------------------------------------------
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
ARTICLE 1
<S> <C>
INTERPRETATION AND DEFINITIONS....................... 1
SECTION 1.1 Interpretation and Definitions.................................. 1
ARTICLE 2
TRUST INDENTURE ACT............................ 4
SECTION 2.1 Trust Indenture Act; Application................................ 4
SECTION 2.2 Lists of Holders of Securities.................................. 4
SECTION 2.3 Reports by Guarantee Trustee.................................... 5
SECTION 2.4 Periodic Reports to Guarantee Trustee........................... 5
SECTION 2.5 Evidence of Compliance with Conditions Precedent................ 5
SECTION 2.6 Guarantee Event of Default; Waiver.............................. 5
SECTION 2.7 Guarantee Event of Default; Notice.............................. 5
SECTION 2.8 Conflicting Interests........................................... 6
SECTION 2.9 Disclosure of Information....................................... 6
SECTION 2.10 Guarantee Trustee May File Proofs of Claim..................... 6
ARTICLE 3
POWERS, DUTIES AND RIGHTS OF
GUARANTEE TRUSTEE.............................. 6
SECTION 3.1 Powers and Duties of Guarantee Trustee.......................... 6
SECTION 3.2 Certain Rights of Guarantee Trustee............................. 8
SECTION 3.3 Not Responsible for Recitals or Issuance of Guarantee...........10
ARTICLE 4
GUARANTEE TRUSTEE........................... 10
SECTION 4.1 Guarantee Trustee; Eligibility................................. 10
SECTION 4.2 Appointment, Removal and Resignation of Guarantee Trustee...... 11
ARTICLE 5
GUARANTEE............................... 12
SECTION 5.1 Guarantee...................................................... 12
SECTION 5.2 Waiver of Notice and Demand.................................... 12
SECTION 5.3 Obligations Not Affected....................................... 12
SECTION 5.4 Rights of Holders.............................................. 13
SECTION 5.5 Guarantee of Payment........................................... 14
</TABLE>
-i-
<PAGE> 3
<TABLE>
Page
----
<S> <C>
SECTION 5.6 Subrogation.................................................... 14
SECTION 5.7 Independent Obligations........................................ 14
ARTICLE 6
LIMITATION OF TRANSACTIONS; SUBORDINATION.................. 14
SECTION 6.1 Limitation of Transactions..................................... 14
SECTION 6.2 Ranking........................................................ 15
ARTICLE 7
TERMINATION.............................. 15
SECTION 7.1 Termination.................................................... 15
ARTICLE 8
INDEMNIFICATION............................ 16
SECTION 8.1 Exculpation.................................................... 16
SECTION 8.2 Indemnification................................................ 16
SECTION 8.3 Compensation................................................... 16
ARTICLE 9
MISCELLANEOUS............................. 17
SECTION 9.1 Successors and Assigns......................................... 17
SECTION 9.2 Amendments..................................................... 17
SECTION 9.3 Notices........................................................ 17
SECTION 9.4 Benefit........................................................ 18
SECTION 9.5 Governing Law.................................................. 18
</TABLE>
-ii-
<PAGE> 4
GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT (the "Guarantee"), dated as of
______________, is executed and delivered by Huntington Bancshares Incorporated,
a Maryland corporation (the "Guarantor"), and The Chase Manhattan Bank, a New
York banking corporation, as trustee (the "Guarantee Trustee"), for the benefit
of the Holders (as defined herein) of the Securities (as defined herein) of
Huntington Capital I, a Delaware statutory business trust (the "Trust").
W I T N E S E T H :
WHEREAS, pursuant to the Declaration (as defined herein), the
Trust is issuing on the date hereof, and may in the future issue additional,
capital securities, having a liquidation amount of $1,000 per capital security,
designated the Floating Rate Capital Securities (the "Capital Securities") and
common securities, having a liquidation amount of $1,000 per common security,
designated the Floating Rate Common Securities (the "Common Securities";
together with the Capital Securities, the "Securities");
WHEREAS, as incentive for the Holders to purchase the
Securities, the Guarantor desires irrevocably and unconditionally to agree, to
the extent set forth in this Guarantee, to pay to the Holders of the Securities
the Guarantee Payments (as defined herein) and to make certain other payments on
the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the purchase by each
Holder of Securities, which purchase the Guarantor hereby agrees shall benefit
the Guarantor, the Guarantor executes and delivers this Guarantee for the
benefit of the Holders.
ARTICLE 1
INTERPRETATION AND DEFINITIONS
SECTION 1.1 Interpretation and Definitions. In this Guarantee,
unless the context otherwise requires:
(a) capitalized terms used in this Guarantee but not defined
in the preamble above have the respective meanings assigned to them in
this Section 1.1;
(b) a term defined anywhere in this Guarantee has the same
meaning throughout;
(c) all references to "the Guarantee" or "this Guarantee" are
to this Guarantee as modified, supplemented or amended from time to
time;
(d) all references in this Guarantee to Articles and Sections
are to Articles and Sections of this Guarantee, unless otherwise
specified;
<PAGE> 5
-2-
(e) a term defined in the Trust Indenture Act has the same
meaning when used in this Guarantee, unless otherwise defined in this
Guarantee or unless the context otherwise requires; and
(f) a reference to the singular includes the plural and vice
versa and a reference to the masculine includes, as applicable, the
feminine.
"Affiliate" has the same meaning as given to that term in Rule
405 of the Securities Act of 1933, as amended, or any successor rule thereunder.
"Business Day" has the meaning given to such term in the
Indenture.
"Corporate Trust Office" means the office of the Guarantee
Trustee at which the corporate trust business of the Guarantee Trustee shall at
any particular time, be principally administered, which office at the date of
execution of this Guarantee is located at The Chase Manhattan Bank, 450 West
33rd Street, New York, New York 10001, Attention: Global Trust Services.
"Covered Person" means any Holder or beneficial owner of
Securities.
"Debentures" means the series of junior subordinated
debentures to be issued by the Guarantor, designated the Floating Rate Junior
Subordinated Debentures due 2027 held by the Property Trustee (as defined in the
Declaration) of the Trust.
"Declaration" means the Amended and Restated Declaration of
Trust, dated as of January 31, 1997, as amended, modified or supplemented from
time to time, among the trustees of the Trust named therein, the Guarantor, as
sponsor, and the holders from time to time of undivided beneficial ownership
interests in the assets of the Trust.
"Guarantee Event of Default" means a default by the Guarantor
on any of its payment or other obligations under this Guarantee.
"Guarantee Trustee" means The Chase Manhattan Bank, until a
successor Guarantee Trustee has been appointed and has accepted such appointment
pursuant to the terms of this Guarantee and thereafter means each such Successor
Guarantee Trustee.
"Guarantee Payments" means the following payments or
distributions, without duplication, with respect to the Securities, to the
extent not paid or made by the Trust: (i) any accumulated and unpaid
Distributions (as defined in the Declaration) that are required to be paid on
such Securities to the extent the Trust shall have sufficient funds available
therefor at the time, (ii) the redemption price, including all accrued and
unpaid Distributions to the date of redemption with respect to any Securities
called for redemption by the Trust, to the extent the Trust shall have
sufficient funds available therefor at the time, and (iii) upon a voluntary or
involuntary dissolution, winding-up or liquidation of the Trust (other than in
connection with the distribution of Debentures to the Holders in exchange for
Securities as provided in the
<PAGE> 6
-3-
Declaration), the lesser of (a) the aggregate of the liquidation amount and all
accrued and unpaid Distributions on the Securities to the date of payment, and
(b) the amount of assets of the Trust remaining available for distribution to
Holders in liquidation of the Trust (in either case, the "Liquidation
Distribution"). If a Trust Enforcement Event (as defined in the Declaration) has
occurred and is continuing, the rights of holders of the Common Securities to
receive Guarantee Payments under this Guarantee are subordinated to the rights
of Holders of the Capital Securities to receive payments hereunder.
"Holder" shall mean any holder of Securities, as registered on
the books and records of the Trust; provided, however, that, in determining
whether the Holders of the requisite percentage of Capital Securities have given
any request, notice, consent or waiver hereunder, "Holder" shall not include the
Guarantor or any Affiliate of the Guarantor or any other obligor on the Capital
Securities; and provided further, that in determining whether the Holders of the
requisite liquidation amount of Capital Securities have voted on any matter
provided for in this Guarantee, then for the purpose of such determination only
(and not for any other purpose hereunder), if the Capital Securities remain in
the form of one or more Global Certificates (as defined in the Declaration), the
term "Holders" shall mean the holder of the Global Certificate acting at the
direction of the beneficial holders of the Securities.
"Indemnified Person" means the Guarantee Trustee, any
Affiliate of the Guarantee Trustee, and any officers, directors, shareholders,
members, partners, employees, representatives, nominees, custodians or agents of
the Guarantee Trustee.
"Indenture" means the Indenture, dated as of January 31, 1997,
among the Guarantor (the "Company") and The Chase Manhattan Bank, as trustee,
and any indenture supplemental thereto pursuant to which the Debentures are to
be issued to the Property Trustee (as defined in the Declaration) of the Trust.
"Majority in Liquidation Amount of the Securities" means,
except as provided in the terms of the Securities or by the Trust Indenture Act,
Holder(s) of outstanding Securities, voting separately as a class, who are the
record holders of more than 50% of the aggregate liquidation amount (including
the stated amount that would be paid on redemption, liquidation or otherwise,
plus accrued and unpaid Distributions to the date upon which the voting
percentages are determined) of all outstanding Securities. In determining
whether the Holders of the requisite amount of Securities have voted, Securities
which are owned by the Guarantor or any Affiliate of the Guarantor shall be
disregarded for the purpose of any such determination.
"Officers' Certificate" means, with respect to any Person, a
certificate signed on behalf of such Person by two Authorized Officers (as
defined in the Declaration) of such Person. Any Officers' Certificate delivered
with respect to compliance with a condition or covenant provided for in this
Guarantee shall include:
(a) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions
relating thereto;
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(b) a statement that each such officer has made such
examination or investigation as, in such officer's opinion, is
necessary to enable such officer on behalf of such Person to express an
informed opinion as to whether or not such covenant or condition has
been complied with; and
(c) a statement as to whether, in the opinion of each such
officer acting on behalf of such Person, such condition or covenant has
been complied with.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint stock
company, limited liability company, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Responsible Officer", when used with respect to the Guarantee
Trustee, means any officer within the Corporate Trust Office, including any Vice
President, Assistant Vice President, the Secretary, any Assistant Secretary or
any other officer of the Guarantee Trustee customarily performing functions
similar to those performed by any of the above designated officers and also
means, with respect to a particular corporate trust matter, any other officer to
whom such matter is referred because of that officer's knowledge of and
familiarity with the particular subject.
"Successor Guarantee Trustee" means a successor Guarantee
Trustee possessing the qualifications to act as Guarantee Trustee under Section
4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended from time to time, or any successor legislation.
ARTICLE 2
TRUST INDENTURE ACT
SECTION 2.1 Trust Indenture Act; Application. (a) This
Guarantee is subject to the provisions of the Trust Indenture Act that are
required to be part of this Guarantee and shall, to the extent applicable, be
governed by such provisions.
(b) If and to the extent that any provision of this Guarantee
limits, qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act, such imposed duties shall control.
SECTION 2.2 Lists of Holders of Securities. (a) The Guarantor
shall provide the Guarantee Trustee with a list, in such form as the Guarantee
Trustee may reasonably require, of the names and addresses of the Holders of the
Securities ("List of Holders"), (i) quarterly, not later than March 31, June 30,
September 30 and December 31 of each year and current as of such date, and (ii)
at such other times as the Guarantee Trustee may request in
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writing, within 30 days of receipt by the Guarantor of a written request from
the Guarantee Trustee for a List of Holders as of a date no more than 15 days
before such List of Holders is given to the Guarantee Trustee; excluding from
any such list names and addresses received by the Guarantee Trustee in its
capacity as Security Registrar (as defined in the Indenture). The Guarantee
Trustee shall preserve, in as current a form as is reasonably practicable, all
information contained in Lists of Holders given to it, provided that it may
destroy any List of Holders previously given to it on receipt of a new List of
Holders.
(b) The Guarantee Trustee shall comply with its obligations
under Sections 311(a), 311(b) and 312(b) of the Trust Indenture Act.
SECTION 2.3 Reports by Guarantee Trustee. Within 60 days after
May 15 of each year (commencing with the year of the first anniversary of the
issuance of the Securities), the Guarantee Trustee shall provide to the Holders
of the Securities such reports as are required by Section 313 of the Trust
Indenture Act (if any) in the form and in the manner provided by Section 313 of
the Trust Indenture Act. The Guarantee Trustee shall also comply with the
requirements of Section 313(d) of the Trust Indenture Act.
SECTION 2.4 Periodic Reports to Guarantee Trustee. The
Guarantor shall provide to the Guarantee Trustee such documents, reports and
information as required by Section 314 (if any) of the Trust Indenture Act and
the compliance certificate required by Section 314 of the Trust Indenture Act in
the form, in the manner and at the times required by Section 314 of the Trust
Indenture Act.
SECTION 2.5 Evidence of Compliance with Conditions Precedent.
The Guarantor shall provide to the Guarantee Trustee such evidence of compliance
with any conditions precedent, if any, provided for in this Guarantee that
relate to any of the matters set forth in Section 314(c) of the Trust Indenture
Act. Any certificate or opinion required to be given by an officer pursuant to
Section 314(c)(1) shall be given in the form of an Officers' Certificate.
SECTION 2.6 Guarantee Event of Default; Waiver. The Holders of
a Majority in Liquidation Amount of the Securities may, by vote or written
consent, on behalf of the Holders of all of the Securities, waive any past
Guarantee Event of Default and its consequences. Upon such waiver, any such
Guarantee Event of Default shall cease to exist, and any Guarantee Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Guarantee, but no such waiver shall extend to any subsequent or other
default or Guarantee Event of Default or impair any right consequent thereon.
SECTION 2.7 Guarantee Event of Default; Notice. (a) The
Guarantee Trustee shall, within 90 days after the occurrence of a Guarantee
Event of Default, transmit by mail, first class postage prepaid, to the Holders
of the Securities, notices of all Guarantee Events of Default actually known to
a Responsible Officer of the Guarantee Trustee, unless such defaults have been
cured before the giving of such notice; provided, that the Guarantee Trustee
shall be protected in withholding such notice if and so long as a Responsible
Officer of the Guarantee
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Trustee in good faith determines that the withholding of such notice is in the
interests of the Holders of the Securities.
(b) The Guarantee Trustee shall not be deemed to have
knowledge of any Guarantee Event of Default unless the Guarantee Trustee shall
have received written notice thereof or a Responsible Officer of the Guarantee
Trustee charged with the administration of the Declaration shall have obtained
actual knowledge thereof.
SECTION 2.8 Conflicting Interests. The Declaration shall be
deemed to be specifically described in this Guarantee for the purposes of clause
(i) of the first provision contained in Section 310(b) of the Trust Indenture
Act.
SECTION 2.9 Disclosure of Information. The disclosure of
information as to the names and addresses of the Holders of the Securities in
accordance with Section 312 of the Trust Indenture Act, regardless of the source
from which such information was derived, shall not be deemed to be a violation
of any existing law, or any law hereafter enacted which does not specifically
refer to Section 312 of the Trust Indenture Act, nor shall the Guarantee Trustee
be held accountable by reason of mailing any material pursuant to a request made
under Section 312(b) of the Trust Indenture Act.
SECTION 2.10 Guarantee Trustee May File Proofs of Claim. Upon
the occurrence of a Guarantee Event of Default, the Guarantee Trustee is hereby
authorized to (a) recover judgment, in its own name and as trustee of an express
trust, against the Guarantor for the whole amount of any Guarantee Payments
remaining unpaid and (b) file such proofs of claim and other papers or documents
as may be necessary or advisable in order to have its claims and those of the
Holders of the Securities allowed in any judicial proceedings relative to the
Guarantor, its creditors or its property.
ARTICLE 3
POWERS, DUTIES AND RIGHTS OF
GUARANTEE TRUSTEE
SECTION 3.1 Powers and Duties of Guarantee Trustee.
(a) This Guarantee shall be held by the Guarantee Trustee on
behalf of the Trust for the benefit of the Holders of the Securities, and the
Guarantee Trustee shall not transfer this Guarantee to any Person except a
Holder of Securities exercising his or her rights pursuant to Section 5.4(b) or
to a Successor Guarantee Trustee on acceptance by such Successor Guarantee
Trustee. The right, title and interest of the Guarantee Trustee in and to this
Guarantee shall automatically vest in any Successor Guarantee Trustee, and such
vesting and succession of title shall be effective whether or not conveyancing
documents have been executed and delivered pursuant to the appointment of such
Successor Guarantee Trustee.
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(b) If a Guarantee Event of Default actually known to a
Responsible Officer of the Guarantee Trustee has occurred and is continuing, the
Guarantee Trustee shall enforce this Guarantee for the benefit of the Holders of
the Securities.
(c) The Guarantee Trustee, before the occurrence of any
Guarantee Event of Default and after the curing of all Guarantee Events of
Default that may have occurred, shall undertake to perform only such duties as
are specifically set forth in this Guarantee, and no implied covenants shall be
read into this Guarantee against the Guarantee Trustee. In case a Guarantee
Event of Default has occurred (that has not been cured or waived pursuant to
Section 2.6) and is actually known to a Responsible Officer of the Guarantee
Trustee, the Guarantee Trustee shall exercise such of the rights and powers
vested in it by this Guarantee, and use the same degree of care and skill in its
exercise thereof, as a prudent person would exercise or use under the
circumstances in the conduct of his or her own affairs.
(d) No provision of this Guarantee shall be construed to
relieve the Guarantee Trustee from liability for its own negligent action, its
own negligent failure to act, or its own willful misconduct, except that:
(i) prior to the occurrence of any Guarantee Event of Default
and after the curing or waiving of all such Guarantee Events of Default
that may have occurred:
(A) the duties and obligations of the Guarantee
Trustee shall be determined solely by the express provisions
of this Guarantee, and the Guarantee Trustee shall not be
liable except for the performance of such duties and
obligations as are specifically set forth in this Guarantee,
and no implied covenants or obligations shall be read into
this Guarantee against the Guarantee Trustee; and
(B) in the absence of bad faith on the part of the
Guarantee Trustee, the Guarantee Trustee may conclusively
rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon any certificates or
opinions furnished to the Guarantee Trustee and conforming to
the requirements of this Guarantee; but in the case of any
such certificates or opinions that by any provision hereof are
specifically required to be furnished to the Guarantee
Trustee, the Guarantee Trustee shall be under a duty to
examine the same to determine whether or not they conform to
the requirements of this Guarantee;
(ii) the Guarantee Trustee shall not be liable for any error
of judgment made in good faith by a Responsible Officer of the
Guarantee Trustee, unless it shall be proved that the Guarantee
Trustee was negligent in ascertaining the pertinent facts upon which
such judgment was made;
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(iii) the Guarantee Trustee shall not be liable with respect
to any action taken or omitted to be taken by it in good faith in
accordance with the direction of the Holders of not less than a
Majority in Liquidation Amount of the Securities relating to the time,
method and place of conducting any proceeding for any remedy available
to the Guarantee Trustee, or exercising any trust or power conferred
upon the Guarantee Trustee under this Guarantee; and
(iv) no provision of this Guarantee shall require the
Guarantee Trustee to expend or risk its own funds or otherwise incur
personal financial liability in the performance of any of its duties
or in the exercise of any of its rights or powers, if the Guarantee
Trustee shall have reasonable grounds for believing that the repayment
of such funds or liability is not reasonably assured to it under the
terms of this Guarantee or indemnity, reasonably satisfactory to the
Guarantee Trustee, against such risk or liability is not reasonably
assured to it.
SECTION 3.2 Certain Rights of Guarantee Trustee. (a) Subject
to the provisions of Section 3.1:
(i) The Guarantee Trustee may conclusively rely, and shall be
fully protected in acting or refraining from acting upon, any
resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or document believed by
it to be genuine and to have been signed, sent or presented by the
proper party or parties;
(ii) Any direction or act of the Guarantor contemplated by
this Guarantee shall be sufficiently evidenced by an Officers'
Certificate;
(iii) Whenever, in the administration of this Guarantee, the
Guarantee Trustee shall deem it desirable that a matter be proved or
established before taking, suffering or omitting any action hereunder,
the Guarantee Trustee may, in the absence of bad faith on its part,
request and conclusively rely upon an Officers' Certificate which, upon
receipt of such request, shall be promptly delivered by the Guarantor;
(iv) The Guarantee Trustee shall have no duty to see to any
recording, filing or registration or any instrument (or any
rerecording, refiling or registration thereof);
(v) The Guarantee Trustee may consult with counsel, and the
advice or opinion of such counsel with respect to legal matters shall
be full and complete authorization and protection in respect of any
action taken, suffered or omitted by it hereunder in good faith and in
accordance with such advice or opinion. Such counsel may be counsel to
the Guarantor or any of its Affiliates and may include any of its
employees. The Guarantee Trustee shall have the right at any
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time to seek instructions concerning the administration of this
Guarantee from any court of competent jurisdiction;
(vi) The Guarantee Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Guarantee at
the request or direction of any Holder, unless such Holder shall have
provided to the Guarantee Trustee such security and indemnity,
reasonably satisfactory to the Guarantee Trustee, against the costs,
expenses (including attorneys' fees and expenses and the expenses of
the Guarantee Trustee's agents, nominees or custodians) and liabilities
that might be incurred by it in complying with such request or
direction, including such reasonable advances as may be requested by
the Guarantee Trustee; provided, that nothing contained in this Section
3.2(a)(vi) shall be taken to relieve the Guarantee Trustee, upon the
occurrence of a Guarantee Event of Default, of its obligation to
exercise the rights and powers vested in it by this Guarantee;
(vii) The Guarantee Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Guarantee Trustee, in
its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit;
(viii) The Guarantee Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by
or through agents, nominees, custodians or attorneys, and the Guarantee
Trustee shall not be responsible for any misconduct or negligence on
the part of any agent or attorney appointed with due care by it
hereunder;
(ix) Any action taken by the Guarantee Trustee or its agents
hereunder shall bind the Holders of the Securities, and the signature
of the Guarantee Trustee or its agents alone shall be sufficient and
effective to perform any such action. No third party shall be required
to inquire as to the authority of the Guarantee Trustee to so act or as
to its compliance with any of the terms and provisions of this
Guarantee, both of which shall be conclusively evidenced by the
Guarantee Trustee's or its agent's taking such action; and
(x) Whenever in the administration of this Guarantee the
Guarantee Trustee shall deem it desirable to receive instructions with
respect to enforcing any remedy or right or taking any other action
hereunder, the Guarantee Trustee (i) may request instructions from the
Holders of a Majority in Liquidation Amount of the Securities, (ii) may
refrain from enforcing such remedy or right or taking such other action
until such instructions are received, and (iii) shall be protected in
conclusively relying on or acting in accordance with such instructions.
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(b) No provision of this Guarantee shall be deemed to impose
any duty or obligation on the Guarantee Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it in any
jurisdiction in which it shall be illegal, or in which the Guarantee Trustee
shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts or to exercise any such right, power, duty or
obligation. No permissive power or authority available to the Guarantee Trustee
shall be construed to be a duty.
SECTION 3.3 Not Responsible for Recitals or Issuance of
Guarantee. The recitals contained in this Guarantee shall be taken as the
statements of the Guarantor, and the Guarantee Trustee does not assume any
responsibility for their correctness. The Guarantee Trustee makes no
representations as to the validity or sufficiency of this Guarantee.
ARTICLE 4
GUARANTEE TRUSTEE
SECTION 4.1 Guarantee Trustee; Eligibility.
(a) There shall be at all times a Guarantee Trustee which
shall:
(i) not be an Affiliate of the Guarantor; and
(ii) be a corporation organized and doing business
under the laws of the United States of America or any State or
Territory thereof or of the District of Columbia, or a
corporation or Person permitted by the Securities and Exchange
Commission to act as an institutional trustee under the Trust
Indenture Act, authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus
of at least 50 million U.S. dollars ($50,000,000), and subject
to supervision or examination by Federal, State, Territorial
or District of Columbia authority. If such corporation
publishes reports of condition at least annually, pursuant to
law or to the requirements of the supervising or examining
authority referred to above, then, for the purposes of this
Section 4.1(a)(ii), the combined capital and surplus of such
corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so
published.
(b) If at any time the Guarantee Trustee shall cease to be
eligible to so act under Section 4.1(a), the Guarantee Trustee shall promptly
resign in the manner and with the effect set out in Section 4.2(c).
(c) If the Guarantee Trustee has or shall acquire any
"conflicting interest" within the meaning of Section 310(b) of the Trust
Indenture Act, the Guarantee Trustee and
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Guarantor shall in all respects comply with the provisions of Section 310(b) of
the Trust Indenture Act.
SECTION 4.2 Appointment, Removal and Resignation of Guarantee
Trustee.
(a) No resignation or removal of the Guarantee Trustee and no
appointment of a Successor Guarantee Trustee pursuant to this Article shall
become effective until the acceptance of appointment by the Successor Guarantee
Trustee by written instrument executed by the Successor Guarantee Trustee and
delivered to the Holders, the Guarantor and the Guarantee Trustee.
(b) Subject to the immediately preceding paragraph, a
Guarantee Trustee may resign at any time by giving written notice thereof to the
Holders and the Guarantor. If the instrument of acceptance by the Successor
Guarantee Trustee shall not have been delivered to the Guarantee Trustee within
30 days after the giving of such notice of resignation, the Guarantee Trustee
may petition, at the expense of the Guarantor, any court of competent
jurisdiction for the appointment of a Successor Guarantee Trustee.
(c) The Guarantee Trustee may be removed for cause at any time
by Act (within the meaning of Section 104 of the Indenture) of the Holders of at
least a Majority in Liquidation Amount of the Capital Securities, delivered to
the Guarantee Trustee.
(d) If a Guarantee Trustee shall be removed or become
incapable of acting as Guarantee Trustee, or if any vacancy shall occur in the
office of any Guarantee Trustee for any cause, the Holders of the Capital
Securities, by Act of the Holders of record of not less than 25% in aggregate
Liquidation Amount of the Capital Securities then outstanding delivered to such
Guarantee Trustee, shall promptly appoint a Successor Guarantee Trustee. If no
Successor Guarantee Trustee shall have been so appointed by the Holders of the
Capital Securities and such appointment accepted by the Successor Guarantee
Trustee, any Holder, on behalf of himself and all other similarly situated, may
petition any court of competent jurisdiction for the appointment of a Successor
Guarantee Trustee.
(e) No Guarantee Trustee shall be liable for the acts or
omissions to act of any Successor Guarantee Trustee.
(f) Upon termination of this Guarantee or removal or
resignation of the Guarantee Trustee pursuant to this Section 4.2, the Guarantor
shall pay to the Guarantee Trustee all amounts owing for fees and reimbursement
of expenses which have accrued to the date of such termination, removal or
resignation.
(g) The Guarantor shall promptly notify the Holders of the
resignation, removal or appointment of the Guarantee Trustee.
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ARTICLE 5
GUARANTEE
SECTION 5.1 Guarantee.
The Guarantor irrevocably and unconditionally agrees to pay in
full to the Holders the Guarantee Payments (without duplication of amounts
theretofore paid by the Trust), as and when due, regardless of any defense,
right of set-off or counterclaim that the Trust may have or assert. The
Guarantor's obligation to make a Guarantee Payment may be satisfied by direct
payment of the required amounts by the Guarantor to the Holders or by causing
the Trust to pay such amounts to the Holders.
SECTION 5.2 Waiver of Notice and Demand.
The Guarantor hereby waives notice of acceptance of this
Guarantee and of any liability to which it applies or may apply, presentment,
demand for payment, any right to require a proceeding first against the Trust or
any other Person before proceeding against the Guarantor, protest, notice of
nonpayment, notice of dishonor, notice of redemption and all other notices and
demands. Notwithstanding anything to the contrary herein, the Guarantor retains
all of its rights under the Indenture to (i) extend the interest payment period
on the Debentures and the Guarantor shall not be obligated hereunder to make any
Guarantee Payments during any Extended Interest Payment Period (as defined in
the Indenture) with respect to the Distributions (as defined in the Declaration)
on the Securities, and (ii) change the maturity date of the Debentures to the
extent permitted by the Indenture.
SECTION 5.3 Obligations Not Affected.
The obligations, covenants, agreements and duties of the
Guarantor under this Guarantee shall be absolute and unconditional and shall
remain in full force and effect until the entire liquidation amount of all
outstanding Securities shall have been paid and such obligation shall in no way
be affected or impaired by reason of the happening from time to time of any
event, including without limitation, the following, whether or not with notice
to, or the consent of, the Guarantor:
(a) The release or waiver, by operation of law or otherwise,
of the performance or observance by the Trust of any express or implied
agreement, covenant, term or condition relating to the Securities to be
performed or observed by the Trust;
(b) The extension of time for the payment by the Trust of all
or any portion of the Distributions, Redemption Price (as defined in
the Indenture), Liquidation Distribution or any other sums payable
under the terms of the Securities or the extension of time for the
performance of any other obligation under, arising out of, or in
connection with the Securities (other than an extension of time for
payment of
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Distributions, Redemption Price, Liquidation Distribution or other sum
payable that results from the extension of any interest payment period
on the Debentures or any change to the maturity date of the Debentures
permitted by the Indenture);
(c) Any failure, omission, delay or lack of diligence on the
part of the Property Trustee or the Holders to enforce, assert or
exercise any right, privilege, power or remedy conferred on the
Property Trustee or the Holders pursuant to the terms of the
Securities, or any action on the part of the Trust granting indulgence
or extension of any kind;
(d) The voluntary or involuntary liquidation, dissolution,
sale of any collateral, receivership, insolvency, bankruptcy,
assignment for the benefit of creditors, reorganization, arrangement,
composition or readjustment of debt of, or other similar proceedings
affecting, the Trust or any of the assets of the Trust;
(e) Any invalidity of, or defect or deficiency in, the
Securities;
(f) The settlement or compromise of any obligation guaranteed
hereby or hereby incurred; or
(g) Any other circumstance whatsoever that might otherwise
constitute a legal or equitable discharge or defense of a guarantor, it
being the intent of this Section 5.3 that the obligations of the
Guarantor hereunder shall be absolute and unconditional under any and
all circumstances.
There shall be no obligation of the Guarantee Trustee or the
Holders to give notice to, or obtain consent of the Guarantor or any other
Person with respect to the happening of any of the foregoing.
No setoff, counterclaim, reduction or diminution of any
obligation, or any defense of any kind or nature that the Guarantor has or may
have against any Holder shall be available hereunder to the Guarantor against
such Holder to reduce the payments to it under this Guarantee.
SECTION 5.4 Rights of Holders.
(a) The Holders of a Majority in Liquidation Amount of the
Securities have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Guarantee Trustee in respect of this
Guarantee or exercising any trust or power conferred upon the Guarantee Trustee
under this Guarantee.
(b) If the Guarantee Trustee fails to enforce this Guarantee,
then any Holder of Securities may, subject to the subordination provisions of
Section 6.2, institute a legal proceeding directly against the Guarantor to
enforce the Guarantee Trustee's rights under this Guarantee without first
instituting a legal proceeding against the Trust, the Guarantee Trustee
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or any other person or entity. Notwithstanding the foregoing, if the Guarantor
has failed to make a Guarantee Payment, a Holder of Securities may, subject to
the subordination provisions of Section 6.2, directly institute a proceeding
against the Guarantor for enforcement of the Guarantee for such payment to the
Holder of the Securities of the principal of or interest on the Debentures on or
after the respective due dates specified in the Debentures, and the amount of
the payment will be based on the Holder's pro rata share of the amount due and
owing on all of the Securities. The Guarantor hereby waives any right or remedy
to require that any action on this Guarantee be brought first against the Trust
or any other person or entity before proceeding directly against the Guarantor.
SECTION 5.5 Guarantee of Payment.
This Guarantee creates a guarantee of payment and not of
collection.
SECTION 5.6 Subrogation.
The Guarantor shall be subrogated to all (if any) rights of
the Holders of Securities against the Trust in respect of any amounts paid to
such Holders by the Guarantor under this Guarantee; provided, however, that the
Guarantor shall not (except to the extent required by mandatory provisions of
law) be entitled to enforce or exercise any right that it may acquire by way of
subrogation of any indemnity, reimbursement or other agreement, in all cases as
a result of payment under this Guarantee, if at the time of any such payment,
any amounts are due and unpaid under this Guarantee. If any amount shall be paid
to the Guarantor in violation of the preceding sentence, the Guarantor agrees to
hold such amount in trust for the Holders and to pay over such amount to the
Guarantee Trustee for the benefit of the Holders.
SECTION 5.7 Independent Obligations.
The Guarantor acknowledges that its obligations hereunder are
independent of the obligations of the Trust with respect to the Securities, and
that the Guarantor shall be liable as principal and as debtor hereunder to make
Guarantee Payments pursuant to the terms of this Guarantee notwithstanding the
occurrence of any event referred to in subsections 5.3(a) through 5.3(g),
inclusive, hereof.
ARTICLE 6
LIMITATION OF TRANSACTIONS; SUBORDINATION
SECTION 6.1 Limitation of Transactions.
So long as any Securities remain outstanding, if there shall
have occurred a Guarantee Event of Default or a Trust Enforcement Event, then
the Guarantor shall not, and shall not permit any subsidiary of the Guarantor,
to (i) declare or pay any dividends or
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distributions on, or redeem, purchase, acquire, or make a liquidation payment
with respect to, the Guarantor's capital stock or (ii) make any payment of
principal, interest or premium, if any, on or repay, repurchase or redeem any
debt securities of the Guarantor that rank pari passu with or junior to the
Debentures or make any guarantee payments with respect to any guarantee by the
Guarantor of the debt securities of any subsidiary of the Guarantor if such
guarantee ranks pari passu with or junior to the Debentures (other than (a)
repurchases, redemptions or other acquisitions of shares of capital stock of the
Guarantor in connection with any employment contract, benefit plan or other
similar arrangement with or for the benefit of any one or more employees,
officers, directors or consultants or in connection with a dividend reinvestment
or stockholder stock purchase plan, (b) as a result of an exchange or conversion
of any class or series of the Guarantor's capital stock (or any capital stock of
a subsidiary of the Guarantor) for any other class or series of the Guarantor's
capital stock or of any class of series of the Guarantor's indebtedness for any
class or series of the Guarantor's capital stock, (c) the purchase of fractional
interests in shares of the Guarantor's capital stock pursuant to the conversion
or exchange provisions of such capital stock or the security being converted or
exchanged, (d) any declaration of a dividend in connection with any
stockholder's rights plan, or the issuance of rights, stock or other property
under any stockholder's rights plan, or the redemption or repurchase of rights
pursuant thereto, or (e) any dividend in the form of stock, warrants, options or
other rights where the dividend stock or the stock issuable upon exercise of
such warrants, options or other rights is the same stock as that on which the
dividend is being paid (or pari passu with or junior to such stock).
SECTION 6.2 Ranking.
This Guarantee will constitute an unsecured obligation of the
Guarantor and will rank subordinate and junior in right of payment to all other
liabilities of the Guarantor, except those liabilities of the Guarantor made
pari passu or subordinate hereto by their express terms.
If a Trust Enforcement Event has occurred and is continuing
under the Declaration, the rights of the holders of the Common Securities to
receive Guarantee Payments hereunder shall be subordinated to the rights of the
holders of the Capital Securities to receive payment of all amounts due and
owing hereunder.
ARTICLE 7
TERMINATION
SECTION 7.1 Termination.
This Guarantee shall terminate upon (i) full payment of the
Redemption Price (as defined in the Indenture) of all Securities, (ii) upon the
distribution of the Debentures to the Holders of all the Securities or (iii)
upon full payment of the amounts payable in accordance with the Declaration upon
liquidation of the Trust. Notwithstanding the foregoing, this Guarantee will
continue to be effective or will be reinstated, as the case may be, if at any
time
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any Holder of Securities must restore payment of any sums paid under the
Securities or under this Guarantee.
ARTICLE 8
INDEMNIFICATION
SECTION 8.1 Exculpation.
(a) No Indemnified Person shall be liable, responsible or
accountable in damages or otherwise to the Guarantor or any Covered Person for
any loss, damage or claim incurred by reason of any act or omission performed or
omitted by such Indemnified Person in good faith in accordance with this
Guarantee and in a manner that such Indemnified Person reasonably believed to be
within the scope of the authority conferred on such Indemnified Person by this
Guarantee or by law, except that an Indemnified Person shall be liable for any
such loss, damage or claim incurred by reason of such Indemnified Person's
negligence or willful misconduct with respect to such acts or omissions.
(b) An Indemnified Person shall be fully protected in relying
in good faith upon the records of the Guarantor and upon such information,
opinions, reports or statements presented to the Guarantor by any Person as to
any matter the Indemnified Person reasonably believes is within such other
Person's professional or expert competence and who has been selected with
reasonable care by or on behalf of the Guarantor, including information,
opinions, reports or statements as to the value and amount of the assets,
liabilities, profits, losses, or any other facts pertinent to the existence and
amount of assets from which Distributions to Holders of Securities might
properly be paid.
SECTION 8.2 Indemnification.
The Guarantor agrees to indemnify each Indemnified Person for,
and to hold each Indemnified Person harmless against any loss, liability or
expense incurred without gross negligence or bad faith on its part, arising out
of or in connection with the acceptance or administration of the trust or trusts
hereunder, including the costs and expenses (including reasonable legal fees and
expenses and fees and expenses of its agents) of defending itself against, or
investigating, any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder. The obligation to
indemnify as set forth in this Section 8.2 shall survive the termination of this
Guarantee.
SECTION 8.3 Compensation.
The Guarantor agrees to pay to the Guarantee Trustee from time
to time reasonable compensation, as mutually agreed to by the Guarantor and the
Guarantee Trustee, for all services rendered by it hereunder (which compensation
shall not be limited by any provision of law in regard to the compensation of a
trustee of an express trust).
<PAGE> 20
-17-
ARTICLE 9
MISCELLANEOUS
SECTION 9.1 Successors and Assigns.
All guarantees and agreements contained in this Guarantee
shall bind the successors, assigns, receivers, trustees and representatives of
the Guarantor and shall inure to the benefit of the Holders of the Securities
then outstanding. Except in connection with any merger or consolidation of the
Guarantor with or into another entity or any sale, transfer or lease of the
Guarantor's assets to another entity, in each case, to the extent permitted
under the Indenture, the Guarantor may not assign its rights or delegate its
obligations under this Guarantee.
SECTION 9.2 Amendments.
Except with respect to any changes that do not adversely
affect the rights of the Holders (in which case no consent of the Holders will
be required), this Guarantee may only be amended with the prior approval of the
Holders of at least a Majority in Liquidation Amount of the Securities. The
provisions of Section 11.2 of the Declaration with respect to meetings of, and
action by written consent of the Holders of the Securities apply to the giving
of such approval.
SECTION 9.3 Notices.
All notices provided for in this Guarantee shall be in
writing, duly signed by the party giving such notice, and shall be delivered,
telecopied or mailed by registered or certified mail, as follows:
(a) If given to the Guarantee Trustee, at the Guarantee
Trustee's mailing address set forth below (or such other address as the
Guarantee Trustee may give notice of to the Guarantor and the Holders
of the Securities):
The Chase Manhattan Bank
450 West 33rd Street
New York, New York 10001
Attention: Global Trust Services
Fax: 212-946-8154 or 8156
(b) If given to the Guarantor, at the Guarantor's mailing
addresses set forth below (or such other address as the Guarantor may
give notice of to the Guarantee Trustee and the Holders of the
Securities):
<PAGE> 21
-18-
Huntington Bancshares Incorporated
Huntington Center
41 South High Street
Columbus, Ohio 43287
Attn: Judith D. Fisher
Fax: (614) 480-5474
(c) If given to any Holder of Securities, at the address set
forth on the books and records of the Trust.
All such notices shall be deemed to have been given when
received in person, telecopied with receipt confirmed, or mailed by first class
mail, postage prepaid, except that if a notice or other document is refused
delivery or cannot be delivered because of a changed address of which no notice
was given, such notice or other document shall be deemed to have been delivered
on the date of such refusal or inability to deliver.
SECTION 9.4 Benefit.
This Guarantee is solely for the benefit of the Holders of the
Securities and, subject to Section 3.1(a), is not separately transferable from
the Securities.
SECTION 9.5 Governing Law.
THIS GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
<PAGE> 22
-19-
IN WITNESS WHEREOF, this Guarantee is executed as of the day
and year first above written.
HUNTINGTON BANCSHARES
INCORPORATED,
as Guarantor
By: /s/ JUDITH D. FISHER
------------------------------------
Name: Judith D. Fisher
Title: Executive Vice President
THE CHASE MANHATTAN BANK,
as Guarantee Trustee
By: /s/ TIMOTHY E. BURKE
------------------------------------
Name: Timothy E. Burke
Title: Second Vice President
<PAGE> 1
Exhibit 4(f)
================================================================================
REGISTRATION RIGHTS AGREEMENT
Dated as of January 31, 1997
Among
HUNTINGTON CAPITAL I,
HUNTINGTON BANCSHARES INCORPORATED
and
MORGAN STANLEY & CO. INCORPORATED
and
Lehman Brothers Inc.,
and
Salomon Brothers Inc
as Initial Purchasers
================================================================================
<PAGE> 2
TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
Page
----
<S> <C>
1. Definitions..................................................................... 1
2. Securities Subject to This Agreement............................................ 3
3. Registered Exchange Offer....................................................... 3
4. Shelf Registration.............................................................. 5
5. Additional Interest and Additional Distributions Under Certain Circumstances.... 6
6. Registration Procedures......................................................... 7
7. Registration Expenses........................................................... 14
8. Indemnification and Contribution................................................ 15
9. Rule 144A....................................................................... 17
10. Participation in Underwritten Registrations..................................... 17
11. Selection of Underwriters....................................................... 18
12. Miscellaneous................................................................... 18
</TABLE>
i
<PAGE> 3
This Registration Rights Agreement (this "Agreement") is made
and entered into as of January 31, 1997 by and among Huntington Capital I, a
Delaware statutory business trust (the "Trust"), Huntington Bancshares
Incorporated, a Maryland corporation ("the Company"), and Morgan Stanley & Co.
Incorporated, Lehman Brothers Inc. and Salomon Brothers Inc (together, the
"Initial Purchasers").
This Agreement is entered into in connection with the Purchase
Agreement, dated as of January 23, 1997, among the Company, the Trust and the
Initial Purchasers (the "Purchase Agreement"), and any additional purchase
agreement between such parties, in each case which provides for the sale by the
Trust to the Initial Purchasers of the Trust's Floating Rate Capital Securities,
liquidation amount $1,000 per security (the "Capital Securities"). The Company
will be the owner of all of the beneficial ownership interest represented by the
common securities (the "Common Securities") of the Trust. The Capital Securities
and the Common Securities will be guaranteed by a guarantee (the "Guarantee") by
the Company, to the extent of funds held by the Trust. Concurrently with the
issuance of the Capital Securities, the Guarantee and the Common Securities, the
Trust will invest the proceeds of each thereof in the Company's Floating Rate
Junior Subordinated Debentures due 2027 (the "Junior Subordinated Debentures"
and, together with the Capital Securities and the Guarantee, the "Securities").
In order to induce the Initial Purchasers to enter into the Purchase Agreement,
the Trust and the Company have agreed to provide the registration rights set
forth in this Agreement for the benefit of the Initial Purchasers and their
direct and indirect transferees and assigns. The execution and delivery of this
Agreement is a condition to the Initial Purchasers' obligations to purchase the
Capital Securities under the Purchase Agreement.
The parties hereby agree as follows:
1. Definitions. As used in this Agreement, the following
capitalized terms shall have the following meanings:
Additional Interest: as defined in Section 5(a) hereof.
Additional Distributions: as defined in Section 5(a) hereof.
Broker-Dealer: Any broker or dealer registered under the
Exchange Act.
Closing Date: The date on which the Securities were sold.
Commission: The Securities and Exchange Commission.
Consummate: A Registered Exchange Offer shall be deemed
"Consummated" for purposes of this Agreement upon the occurrence of (i)
the filing and effectiveness under the Securities Act of the Exchange
Offer Registration Statement relating to the New Securities to be
issued in the Exchange Offer, (ii) the maintenance of such Registration
Statement continuously effective and the keeping of the Exchange Offer
open for a period not less than the minimum period required pursuant to
Section 3(b) hereof, and (iii) the delivery by the Company and the
Trust of the New Securities in the same aggregate principal amount as
the aggregate principal amount of Transfer Restricted Securities that
were tendered by Holders thereof pursuant to the Exchange Offer.
Declaration: The Amended and Restated Declaration of Trust,
dated as of January 31, 1997, among The Chase Manhattan Bank, as
Property Trustee, Chase Manhattan Bank Delaware, as Delaware Trustee,
and the Regular Trustees named therein, pursuant to which the Capital
Securities are being issued, as amended or supplemented from time to
time in accordance with the terms thereof.
<PAGE> 4
2
Distribution: As defined in the Declaration.
Effectiveness Target Date: As defined in Section 5.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Exchange Offer: The registration by the Company and the Trust
under the Securities Act of the New Securities pursuant to a
Registration Statement pursuant to which the Company and the Trust
offer the Holders of all outstanding Transfer Restricted Securities the
opportunity to exchange all such outstanding Transfer Restricted
Securities held by such Holders for New Securities in an aggregate
amount equal to the aggregate amount of the Transfer Restricted
Securities tendered in such exchange offer by such Holders.
Exchange Offer Registration Statement: The Registration
Statement relating to the Exchange Offer, including the Prospectus
which forms a part thereof.
Exempt Resales: The transactions in which the Initial
Purchasers propose to sell the Securities to certain "qualified
institutional buyers," as such term is defined in Rule 144A under the
Securities Act, to certain institutional "accredited investors," as
such term is defined in Rule 501(a)(1), (2), (3) and (7) of Regulation
D under the Securities Act ("Accredited Institutions") and to certain
non-"U.S. persons" in "offshore transactions," as such terms are
defined in Regulation S under the Securities Act.
Guarantee Agreement: The Guarantee Agreement, dated as of
January 31, 1997, between the Company and The Chase Manhattan Bank, as
Guarantee Trustee, pursuant to which the Guarantee is being issued, as
amended or supplemented from time to time in accordance with the terms
thereof.
Holders: As defined in Section 2(b) hereof.
Indenture: The Indenture, dated as of January 31, 1997,
between the Company and The Chase Manhattan Bank, as trustee (the
"Trustee"), pursuant to which the Junior Subordinated Debentures are to
be issued, as such Indenture is amended or supplemented from time to
time in accordance with the terms thereof.
Initial Purchasers: As defined in the preamble hereto.
NASD: National Association of Securities Dealers, Inc.
New Junior Subordinated Debentures: The Company's Junior
Subordinated Debentures to be issued pursuant to the Indenture in the
Exchange Offer.
New Securities: The Securities to be issued pursuant to the
Indenture, the Declaration and the Guarantee Agreement in the Exchange
Offer.
Person: An individual, partnership, corporation, limited
liability company, trust or unincorporated organization, or a
government or agency or political subdivision thereof.
<PAGE> 5
3
Prospectus: The prospectus included in a Registration
Statement, as amended or supplemented by any prospectus supplement and
by all other amendments thereto, including post-effective amendments,
and all material incorporated by reference into such Prospectus.
Registration Default: As defined in Section 5 hereof.
Registration Statement: Any registration statement of the
Company and the Trust relating to (a) an offering of New Securities
pursuant to an Exchange Offer or (b) the registration for resale of
Transfer Restricted Securities pursuant to the Shelf Registration
Statement, which is filed pursuant to the provisions of this Agreement,
in either case, including the Prospectus included therein, all
amendments and supplements thereto (including post-effective
amendments) and all exhibits and material incorporated by reference
therein.
Securities Act: The Securities Act of 1933, as amended.
Shelf Filing Deadline: As defined in Section 4 hereof.
Shelf Registration Statement: As defined in Section 4 hereof.
TIA: The Trust Indenture Act of 1939, as amended.
Transfer Restricted Securities: Each Security, until the
earliest to occur of (a) the date on which such Security has been
exchanged by a person other than a Broker-Dealer for New Securities in
the Exchange Offer, (b) following the exchange by a Broker-Dealer in
the Exchange Offer of such Security for one or more New Securities, the
date on which such New Securities are sold to a purchaser who receives
from such Broker-Dealer on or prior to the date of such sale a copy of
the prospectus contained in the Exchange Offer Registration Statement,
(c) the date on which such Security has been effectively registered
under the Securities Act and disposed of in accordance with the Shelf
Registration Statement or (d) the date on which such Security is
distributed to the public pursuant to Rule 144 under the Securities
Act;
Underwritten Registration or Underwritten Offering: A
registration in which securities of the Company and the Trust are sold
to an underwriter for reoffering to the public.
2. Securities Subject to This Agreement.
(a) Transfer Restricted Securities. The securities entitled to
the benefits of this Agreement are the Transfer Restricted Securities.
(b) Holders of Transfer Restricted Securities. A Person is
deemed to be a holder of Transfer Restricted Securities (each, a
"Holder") whenever such Person beneficially owns Transfer Restricted
Securities.
3. Registered Exchange Offer.
(a) Unless the Exchange Offer shall not be permissible under
applicable law or Commission policy (after the procedures set forth in
Section 6(a) below have been complied with), the Company and the Trust
shall (i) cause to be filed with the Commission as soon as practicable
after the Closing Date, but in no event later than 150 days after the
Closing Date, a Registration Statement under the Securities Act
relating to the New Securities and the
<PAGE> 6
4
Exchange Offer, (ii) use their respective best efforts to cause such
Registration Statement to become effective at the earliest possible
time, but in no event later than 180 days after the Closing Date, (iii)
in connection with the foregoing, file (A) all pre-effective amendments
to such Registration Statement as may be necessary in order to cause
such Registration Statement to become effective, (B) if applicable, a
post-effective amendment to such Registration Statement pursuant to
Rule 430A under the Securities Act and (C) cause all necessary filings
in connection with the registration and qualification of the New
Securities to be made under the Blue Sky laws of such jurisdictions as
are necessary to permit Consummation of the Exchange Offer, and (iv)
unless the Exchange Offer would not be permitted by applicable law or
Commission policy, the Company will commence the Exchange Offer and use
its best efforts to issue on or prior to 30 business days after the
date on which such Registration Statement was declared effective by the
Commission, New Securities in exchange for all Securities tendered
prior thereto in the Exchange Offer. The Exchange Offer shall be on the
appropriate form permitting registration of the New Securities to be
offered in exchange for the Transfer Restricted Securities and to
permit resales of New Securities held by Broker-Dealers as contemplated
by Section 3(c) below.
(b) The Company and the Trust shall cause the Exchange Offer
Registration Statement to be effective continuously and shall keep the
Exchange Offer open for a period of not less than the minimum period
required under applicable federal and state securities laws to
Consummate the Exchange Offer; provided, however, that in no event
shall such period be less than 20 business days. The Company and the
Trust shall cause the Exchange Offer to comply with all applicable
federal and state securities laws. No securities other than the New
Securities shall be included in the Exchange Offer Registration
Statement. The Company and the Trust shall use their best efforts to
cause the Exchange Offer to be Consummated on the earliest practicable
date after the Exchange Offer Registration Statement has become
effective, but in no event later than 30 business days thereafter.
(c) The Company and the Trust shall indicate in a "Plan of
Distribution" section contained in the Prospectus contained in the
Exchange Offer Registration Statement that any Broker-Dealer who holds
Securities that are Transfer Restricted Securities and that were
acquired for its own account as a result of market-making activities or
other trading activities (other than Transfer Restricted Securities
acquired directly from the Company and the Trust), may exchange such
Securities pursuant to the Exchange Offer; however, such Broker-Dealer
may be deemed to be an "underwriter" within the meaning of the
Securities Act and must, therefore, deliver a prospectus meeting the
requirements of the Securities Act in connection with any resales of
the New Securities received by such Broker-Dealer in the Exchange
Offer, which prospectus delivery requirement may be satisfied by the
delivery by such Broker-Dealer of the Prospectus contained in the
Exchange Offer Registration Statement. Such "Plan of Distribution"
section shall also contain all other information with respect to such
resales by Broker-Dealers that the Commission may require in order to
permit such resales pursuant thereto, but such "Plan of Distribution"
shall not name any such Broker-Dealer or disclose the amount of New
Securities held by any such Broker-Dealer except to the extent required
by the Commission as a result of a change in policy announced after the
date of this Agreement.
The Company and the Trust shall use their respective best
efforts to keep the Exchange Offer Registration Statement continuously
effective, supplemented and amended as required by the provisions of Section
6(c) below to the extent necessary to ensure that it is available for resales of
New Securities acquired by Broker-Dealers for their own accounts as a result of
market-making activities or other trading activities, and to ensure that it
conforms with the requirements of this Agreement, the
<PAGE> 7
5
Securities Act and the policies, rules and regulations of the Commission as
announced from time to time, for a period of 180 days from the date on which the
Exchange Offer Registration Statement is declared effective.
The Company and the Trust shall provide sufficient copies of
the latest version of such Prospectus to Broker-Dealers promptly upon request at
any time during such 180-day period in order to facilitate such resales.
4. Shelf Registration.
(a) Shelf Registration. If (i) the Company and the Trust are
not required to file an Exchange Offer Registration Statement or to
consummate the Exchange Offer because the Exchange Offer is not
permitted by applicable law or Commission policy (after the procedures
set forth in Section 6(a) below have been complied with), (ii) the
Company has received an opinion of counsel, rendered by a law firm
experienced in such matters, to the effect that, as a result of the
consummation of the Exchange Offer there is more than an insubstantial
risk that (x) the Trust would be subject to United States federal
income tax with respect to income received or accrued on the Junior
Subordinated Debentures or New Junior Subordinated Debentures, (y)
interest payable by the Company on such Junior Subordinated Debentures
or New Junior Subordinated Debentures would not be deductible by the
Company, in whole or in part, for United States federal income tax
purposes, or (z) the Trust would be subject to more than a de minimis
amount of other taxes, duties or other governmental charges or (iii)
any Holder of Transfer Restricted Securities shall notify the Company
on or before the 20th business day following the Consummation of the
Exchange Offer (A) that such Holder is prohibited by applicable law or
Commission policy from participating in the Exchange Offer, or (B) that
such Holder may not resell the New Securities acquired by it in the
Exchange Offer to the public without delivering a prospectus and that
the Prospectus contained in the Exchange Offer Registration Statement
is not appropriate or available for such resales by such Holder, or (C)
that such Holder is a Broker-Dealer and holds Securities acquired
directly from the Trust or one of its affiliates, then the Trust and
the Company shall use their respective best efforts to:
(x) cause to be filed a shelf registration statement
pursuant to Rule 415 under the Securities Act, which may be an
amendment to the Exchange Offer Registration Statement (in
either event, the "Shelf Registration Statement"), on or prior
to the earliest to occur of (1) the 150th day after the date
on which the Trust and the Company determines that they are
not required to file the Exchange Offer Registration Statement
or (2) the 150th day after the date on which the Trust and the
Company receive notice from a Holder of Transfer Restricted
Securities as contemplated by clause (iii) above (such
earliest date being the "Shelf Filing Deadline"), which Shelf
Registration Statement shall provide for resales of all
Transfer Restricted Securities the Holders of which shall have
provided the information required pursuant to Section 4(b)
hereof; and
(y) cause such Shelf Registration Statement to be
declared effective by the Commission on or before the 180th
day after the Shelf Filing Deadline.
<PAGE> 8
6
The Trust and the Company shall use their respective best
efforts to keep such Shelf Registration Statement continuously
effective, supplemented and amended as required by the
provisions of Sections 6(b) and (c) hereof to the extent
necessary to ensure that it is available for resales of
Securities by the Holders of Transfer Restricted Securities
entitled to the benefit of this Section 4(a), and to ensure
that it conforms with the requirements of this Agreement, the
Securities Act and the policies, rules and regulations of the
Commission as announced from time to time, for a period ending
on the third anniversary of the Closing Date.
(b) Provision by Holders of Certain Information in
Connection with the Shelf Registration Statement. No Holder of
Transfer Restricted Securities may include any of its Transfer
Restricted Securities in any Shelf Registration Statement
pursuant to this Agreement unless and until such Holder
furnishes to the Trust and the Company in writing, within 20
business days after receipt of a request therefor, such
information as the Trust and the Company may reasonably
request for use in connection with any Shelf Registration
Statement or Prospectus or preliminary Prospectus included
therein. No Holder of Transfer Restricted Securities shall be
entitled to Additional Distributions pursuant to Section 5
hereof unless and until such Holder shall have used its best
efforts to provide all such reasonably requested information.
Each Holder as to which any Shelf Registration Statement is
being effected agrees to furnish promptly to the Trust and the
Company all information required to be disclosed in order to
make the information previously furnished to the Trust and the
Company by such Holder not materially misleading.
5. Additional Interest and Additional Distributions Under Certain
Circumstances.
(a) If (a) any Registration Statement required by this
Agreement is not filed with the Commission on or prior to the date specified for
such filing in this Agreement, (b) any such Registration Statement has not been
declared effective by the Commission on or prior to the date specified for such
effectiveness in this Agreement (the "Effectiveness Target Date"), (c) the
Exchange Offer has not been Consummated within 30 business days after the
Effectiveness Target Date with respect to the Exchange Offer Registration
Statement or (d) any Registration Statement required by this Agreement is filed
and declared effective but shall thereafter cease to be effective or fail to be
usable for its intended purpose (other than for any reason set forth in Section
6(c)(iii)(D) hereof) without being succeeded within five business days by a
post-effective amendment to such Registration Statement that cures such failure
and that is itself immediately declared effective (each such event referred to
in clauses (a) through (d), a "Registration Default"), additional interest (the
"Additional Interest") shall accrue in respect of the Junior Subordinated
Debentures (including in respect of amounts accruing during any Extension Period
(as defined in the Indenture)) and corresponding additional Distributions (the
"Additional Distributions") shall accrue to each Holder of Capital Securities
(in its capacity as such and not in its capacity as an indirect holder of a pro
rata share of the Junior Subordinated Debentures) commencing upon the occurrence
of such Registration Default in an amount equal to .25% per annum per $1,000
liquidation amount of Capital Securities held by such Holder. The amount of
Additional Interest (and corresponding Additional Distributions) will not exceed
.25% per annum regardless of the number of Registration Defaults. All accrued
Additional Interest (and corresponding Additional Distributions) shall be paid
to Holders by the Trust and the Company in the same manner as interest and
distributions are made pursuant to the Indenture and the Declaration. Following
the cure of all Registration Defaults relating to any particular Transfer
Restricted Securities, the accrual of Additional Interest (and corresponding
Additional Distributions) with respect to such Transfer Restricted Securities
will cease.
<PAGE> 9
7
All obligations of the Trust and the Company set forth in the
preceding paragraph that are outstanding with respect to any Transfer Restricted
Security at the time such security ceases to be a Transfer Restricted Security
shall survive until such time as all such obligations with respect to such
Transfer Restricted Security shall have been satisfied in full.
(b) The Trust and the Company shall notify the Property
Trustee within one business day after each and every date on which an event
occurs in respect of which Additional Distributions are required to be paid (an
"Event Date"). Additional Distributions shall be paid by depositing Additional
Interest with the Property Trustee, in trust, for the benefit of the Holders
thereof, on or before the applicable Interest Payment Date (whether or not any
payment other than Additional Distributions is payable on the Capital
Securities), in immediately available funds in sums sufficient to pay the
Additional Distributions then due to Holders of Transfer Restricted Securities
with respect to which the Property Trustee serves. Each obligation to pay
Additional Interest and Additional Distributions shall be deemed to accrue from
the applicable date of the occurrence of the Registration Default.
6. Registration Procedures.
(a) Exchange Offer Registration Statement. In connection with
the Exchange Offer, the Trust and the Company shall comply with all of
the provisions of Section 6(c) below, shall use their best efforts to
effect such exchange to permit the sale of Transfer Restricted
Securities being sold in accordance with the intended method or methods
of distribution thereof, and shall comply with all of the following
provisions:
(i) If in the reasonable opinion of counsel to the
Trust and the Company there is a question as to whether the
Exchange Offer is permitted by applicable law, the Trust and
the Company hereby agree to seek a no-action letter from the
Commission allowing the Trust and the Company to Consummate an
Exchange Offer for such Securities. The Trust and the Company
hereby agree to pursue the issuance of such a decision to the
Commission staff level but shall not be required to take
commercially unreasonable action to effect a change of
Commission policy. The Trust and the Company hereby agree,
however, to (A) participate in telephonic conferences with the
Commission, (B) deliver to the Commission staff an analysis
prepared by counsel to the Trust and the Company setting forth
the legal bases, if any, upon which such counsel has concluded
that such an Exchange Offer should be permitted and (C)
diligently pursue a resolution (which need not be favorable)
by the Commission staff of such submission.
(ii) As a condition to its participation in the
Exchange Offer pursuant to the terms of this Agreement, each
Holder of Transfer Restricted Securities shall furnish, upon
the request of the Trust or the Company, prior to the
Consummation thereof, a written representation to the Trust or
the Company (which may be contained in the letter of
transmittal contemplated by the Exchange Offer Registration
Statement) to the effect that (A) it is not an affiliate of
the Trust or the Company, (B) it is not engaged in, and does
not intend to engage in, and has no arrangement or
understanding with any person to participate in, a
distribution of the New Securities to be issued in the
Exchange Offer and (C) it is acquiring the New Securities in
its ordinary course of business. In addition, all such Holders
of Transfer Restricted Securities shall otherwise cooperate in
the Company's and the Trust's preparations for the Exchange
Offer. Each Holder hereby acknowledges and agrees that any
Broker-Dealer and any such Holder using the Exchange Offer to
participate in
<PAGE> 10
8
a distribution of the securities to be acquired in the
Exchange Offer (1) could not under Commission policy as in
effect on the date of this Agreement rely on the position of
the Commission enunciated in Morgan Stanley and Co., Inc.
(available June 5, 1991) and Exxon Capital Holdings
Corporation (available May 13, 1988), as interpreted in the
Commission's letter to Shearman & Sterling dated July 2, 1993,
and similar no-action letters (including any no-action letter
obtained pursuant to clause (i) above), and (2) must comply
with the registration and prospectus delivery requirements of
the Securities Act in connection with a secondary resale
transaction and that such a secondary resale transaction
should be covered by an effective registration statement
containing the selling security holder information required by
Item 507 or 508, as applicable, of Regulation S-K if the
resales are of New Securities obtained by such Holder in
exchange for Securities acquired by such Holder directly from
the Trust or the Company.
(iii) Prior to effectiveness of the Exchange Offer
Registration Statement, the Company and the Trust shall
provide a supplemental letter to the Commission (A) stating
that the Company and the Trust are registering the Exchange
Offer in reliance on the position of the Commission enunciated
in Exxon Capital Holdings Corporation (available May 13,
1988), Morgan Stanley and Co., Inc. (available June 5, 1991)
and, if applicable, any no-action letter obtained pursuant to
clause (i) above and (B) including a representation that the
Company and the Trust have not entered into any arrangement or
understanding with any Person to distribute the New Securities
to be received in the Exchange Offer and that, to the best of
the Company's and the Trust's information and belief, based
only on written representations received under clause (ii)
above, that each Holder participating in the Exchange Offer is
acquiring the New Securities in its ordinary course of
business and has no arrangement or understanding with any
Person to participate in the distribution of the New
Securities received in the Exchange Offer.
(b) Shelf Registration Statement. In connection with the Shelf
Registration Statement, the Company and the Trust shall comply with all
the provisions of Section 6(c) below and shall use their best efforts
to effect such registration to permit the sale of the Transfer
Restricted Securities being sold in accordance with the intended method
or methods of distribution thereof, and pursuant thereto the Company
and the Trust will as expeditiously as possible prepare and file with
the Commission a Registration Statement relating to the registration on
any appropriate form under the Securities Act, which form shall be
available for the sale of the Transfer Restricted Securities in
accordance with the intended method or methods of distribution thereof.
(c) General Provisions. In connection with any Registration
Statement and any Prospectus required by this Agreement to permit the
sale or resale of Transfer Restricted Securities (including, without
limitation, any Registration Statement and the related Prospectus
required to permit resales of Securities by Broker-Dealers), the
Company and the Trust shall:
(i) use their best efforts to keep such Registration
Statement continuously effective and provide all requisite
financial statements for the period specified in Section 3 or
4 of this Agreement, as applicable; upon the occurrence of any
event that would cause any such Registration Statement or the
Prospectus contained therein (A) to contain a material
misstatement or omission or (B) not to be effective and usable
for resale of Transfer Restricted Securities during the period
required by this
<PAGE> 11
9
Agreement, the Company and the Trust shall file promptly an
appropriate amendment to such Registration Statement, in the
case of clause (A), correcting any such misstatement or
omission, and, in the case of either clause (A) or (B), use
their best efforts to cause such amendment to be declared
effective and such Registration Statement and the related
Prospectus to become usable for their intended purpose(s) as
soon as practicable thereafter;
(ii) prepare and file with the Commission such
amendments and post-effective amendments to the Registration
Statement as may be necessary to keep the Registration
Statement effective for the applicable period set forth in
Section 3 or 4 hereof, as applicable, or such shorter period
as will terminate when all Transfer Restricted Securities
covered by such Registration Statement have been sold; cause
the Prospectus to be supplemented by any required Prospectus
supplement, and as so supplemented to be filed pursuant to
Rule 424 under the Securities Act, and to comply fully with
the applicable provisions of Rules 424 and 430A under the
Securities Act in a timely manner; and comply with the
provisions of the Securities Act with respect to the
disposition of all securities covered by such Registration
Statement during the applicable period in accordance with the
intended method or methods of distribution by the sellers
thereof set forth in such Registration Statement or supplement
to the Prospectus;
(iii) advise the underwriter(s), if any, and selling
Holders promptly and, if requested by such Persons, to confirm
such advice in writing, (A) when the Prospectus or any
Prospectus supplement or post-effective amendment has been
filed, and, with respect to any Registration Statement or any
post-effective amendment thereto, when the same has become
effective, (B) of any request by the Commission for amendments
to the Registration Statement or amendments or supplements to
the Prospectus or for additional information relating thereto,
(C) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement
under the Securities Act or of the suspension by any state
securities commission of the qualification of the Transfer
Restricted Securities for offering or sale in any
jurisdiction, or the initiation of any proceeding for any of
the preceding purposes, and (D) of the existence of any fact
or the happening of any event that makes any statement of a
material fact made in the Registration Statement, the
Prospectus, any amendment or supplement thereto, or any
document incorporated by reference therein untrue, or that
requires the making of any additions to or changes in the
Registration Statement or the Prospectus in order to make the
statements therein not misleading; provided that the Company
shall not be required to disclose the nature or substance of
any such fact or event as long as it is acting in good faith.
If at any time the Commission shall issue any stop order
suspending the effectiveness of the Registration Statement, or
any state securities commission or other regulatory authority
shall issue an order suspending the qualification or exemption
from qualification of the Transfer Restricted Securities under
state securities or Blue Sky laws, the Trust and the Company
shall use their best efforts to obtain the withdrawal or
lifting of such order at the earliest possible time;
(iv) furnish to each of the selling or exchanging
Holders and each of the underwriter(s), if any, before filing
with the Commission, copies of any Shelf Registration
Statement or any Prospectus included therein or any amendments
or supplements to any such Shelf Registration Statement or
Prospectus (excluding all
<PAGE> 12
10
documents incorporated by reference after the initial filing
of such Registration Statement), which documents will be
subject to the review of such Holders and underwriter(s), if
any, for a period of at least five business days, and the
Trust and the Company will not file any such Registration
Statement or Prospectus or any amendment or supplement to any
such Registration Statement or Prospectus (excluding all
documents incorporated by reference) to which a selling Holder
of Transfer Restricted Securities covered by such Registration
Statement or the underwriter(s), if any, shall reasonably
object within five business days after the receipt thereof. A
selling Holder or underwriter, if any, shall be deemed to have
reasonably objected to such filing if such Registration
Statement, amendment, Prospectus or supplement, as applicable,
as proposed to be filed, contains a material misstatement or
omission;
(v) promptly after the filing of any document that is
to be incorporated by reference into a Registration Statement
or Prospectus, provide copies of such document to the selling
Holders and to the underwriter(s), if any, make the Trust's
and the Company's representatives available for discussion of
such document and other customary due diligence matters;
(vi) make available at reasonable times for
inspection by the selling Holders, any underwriter
participating in any disposition pursuant to such Registration
Statement, and any attorney or accountant retained by such
selling Holders or any of the underwriter(s), all financial
and other records, pertinent corporate documents and
properties of the Trust and the Company and cause the Trust's
and the Company's officers, directors, managers and employees
to supply all information reasonably requested by any such
Holder, underwriter, attorney or accountant in connection with
such Registration Statement subsequent to the filing thereof
and prior to its effectiveness;
(vii) if requested by any selling Holders under the
Shelf Registration Statement or the underwriter(s), if any,
promptly incorporate in any Registration Statement or
Prospectus, pursuant to a supplement or post-effective
amendment if necessary, such information as such selling
Holders and underwriter(s), if any, may reasonably request to
have included therein, including, without limitation,
information relating to the "Plan of Distribution" of the
Transfer Restricted Securities, information with respect to
the principal amount of Transfer Restricted Securities being
sold to such underwriter(s), the purchase price being paid
therefor and any other terms of the offering of the Transfer
Restricted Securities to be sold in such offering; and make
all required filings of such Prospectus supplement or
post-effective amendment as soon as practicable after the
Trust and the Company are notified of the matters to be
incorporated in such Prospectus supplement or post-effective
amendment;
(viii) cause the Transfer Restricted Securities
covered by the Registration Statement to be rated with the
appropriate rating agencies, if so requested by the Holders of
a majority in aggregate principal amount of Securities covered
thereby or the underwriter(s), if any;
(ix) furnish to each selling Holder and each of the
underwriter(s), if any, without charge, at least one copy of
the Registration Statement, as first filed with the
Commission, and of each amendment thereto, including all
documents incorporated
<PAGE> 13
11
by reference therein and all exhibits (including exhibits
incorporated therein by reference);
(x) deliver to each selling Holder and each of the
underwriter(s), if any, without charge, as many copies of the
Prospectus (including each preliminary prospectus) and any
amendment or supplement thereto as such Persons reasonably may
request; the Trust and the Company hereby consent to the use
of the Prospectus and any amendment or supplement thereto by
each of the selling Holders and each of the underwriter(s), if
any, in connection with the offering and the sale of the
Transfer Restricted Securities covered by the Prospectus or
any amendment or supplement thereto;
(xi) enter into such agreements (including an
underwriting agreement), and make such representations and
warranties, and take all such other actions in connection
therewith in order to expedite or facilitate the disposition
of the Transfer Restricted Securities pursuant to any
Registration Statement contemplated by this Agreement, all to
such extent as may be reasonably requested by any Purchaser or
by any Holder of Transfer Restricted Securities or underwriter
in connection with any sale or resale pursuant to any
Registration Statement contemplated by this Agreement; and in
connection with an Underwritten Registration, the Trust and
the Company shall:
(A) upon request, furnish to each selling
Holder and each underwriter, if any, in such
substance and scope as they may reasonably request
and as are customarily made by issuers to
underwriters in primary underwritten offerings, upon
the date of the effectiveness of the Shelf
Registration Statement:
(1) a certificate, dated the date
of the effectiveness of the Shelf
Registration Statement, signed by (y) the
Chairman of the Board, its President or a
Vice President and (z) the Chief Financial
Officer of the Company, confirming, as of
the date thereof, such matters as such
parties may reasonably request;
(2) an opinion, dated the date of
the effectiveness of the Shelf Registration
Statement, of counsel for the Company and
the Trust, covering such matters as such
parties may reasonably request, and in any
event including a statement to the effect
that such counsel has participated in
conferences with officers and other
representatives of the Company and the
Trust, representatives of the independent
public accountants for the Company, the
Initial Purchasers' representatives and the
Initial Purchasers' counsel in connection
with the preparation of such Registration
Statement and the related Prospectus and
have considered the matters required to be
stated therein and the statements contained
therein, although such counsel has not
independently verified the accuracy,
completeness or fairness of such statements;
and that such counsel advises that, on the
basis of the foregoing (relying as to
materiality to a large extent upon facts
provided to such counsel by officers and
other representatives of the Company and the
Trust and without independent check or
verification), no facts came to such
counsel's attention that caused such counsel
to believe that the applicable Registration
Statement, at the time such
<PAGE> 14
12
Registration Statement or any post-effective
amendment thereto became effective,
contained an untrue statement of a material
fact or omitted to state a material fact
required to be stated therein or necessary
to make the statements therein not
misleading, or that the Prospectus contained
in such Registration Statement as of its
date, contained an untrue statement of a
material fact or omitted to state a material
fact necessary in order to make the
statements therein, in light of the
circumstances under which they were made,
not misleading. Without limiting the
foregoing, such counsel may state further
that such counsel assumes no responsibility
for, and has not independently verified, the
accuracy, completeness or fairness of the
financial statements, notes and schedules
and other financial data included in any
Registration Statement contemplated by this
Agreement or the related Prospectus; and
(3) a customary comfort letter,
dated the date of the effectiveness of the
Shelf Registration Statement, from the
Company's independent accountants, in the
customary form and covering matters of the
type customarily covered in comfort letters
by underwriters in connection with primary
underwritten offerings.
(B) set forth in full or incorporate by
reference in the underwriting agreement, if any, the
indemnification provisions and procedures of Section
8 hereof with respect to all parties to be
indemnified pursuant to said Section; and
(C) deliver such other documents and
certificates as may be reasonably requested by such
parties to evidence compliance with clause (A) above
and with any customary conditions contained in the
underwriting agreement or other agreement entered
into by the Company and the Trust pursuant to this
clause (xi), if any.
If at any time the representations and warranties of
the Company contemplated in clause (A)(1) above cease to be
true and correct, the Company shall so advise the Initial
Purchasers and the underwriter(s), if any, and each selling
Holder promptly and, if requested by such Persons, shall
confirm such advice in writing;
(xii) prior to any public offering of Transfer
Restricted Securities, cooperate with the selling Holders, the
underwriter(s), if any, and their respective counsel in
connection with the registration and qualification of the
Transfer Restricted Securities under the securities or Blue
Sky laws of such jurisdictions as the selling Holders or
underwriter(s) may reasonably request and do any and all other
acts or things necessary or advisable to enable the
disposition in such jurisdictions of the Transfer Restricted
Securities covered by the Shelf Registration Statement;
provided, however, that neither the Company nor the Trust
shall not be required to register or qualify as a foreign
corporation where it is not now so qualified or to take any
action that would subject it to the service of process in
suits or to taxation, other than as to matters and
transactions relating to the Registration Statement, in any
jurisdiction where it is not now so subject;
<PAGE> 15
13
(xiii) shall issue, upon the request of any Holder of
Securities covered by the Shelf Registration Statement, New
Securities in the same amount as the Securities surrendered to
the Company and the Trust by such Holder in exchange therefor
or being sold by such Holder; such New Securities to be
registered in the name of such Holder or in the name of the
purchaser(s) of such Securities, as the case may be; in
return, the Securities held by such Holder shall be
surrendered to the Company and the Trust for cancellation;
(xiv) cooperate with the selling Holders and the
underwriter(s), if any, to facilitate the timely preparation
and delivery of certificates representing Transfer Restricted
Securities to be sold and not bearing any restrictive legends;
and enable such Transfer Restricted Securities to be in such
denominations and registered in such names as the Holders or
the underwriter(s), if any, may request at least two business
days prior to any sale of Transfer Restricted Securities made
by such underwriter(s);
(xvi) if any fact or event contemplated by clause
(c)(iii)(D) above shall exist or have occurred, as promptly as
is practicable under the circumstances in the good faith
determination of the Company prepare a supplement or
post-effective amendment to the Registration Statement or
related Prospectus or any document incorporated therein by
reference or file any other required document so that, as
thereafter delivered to the purchasers of Transfer Restricted
Securities, the Registration Statement will not contain an
untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein not
misleading; and any Prospectus will not contain an untrue
statement of a material fact or omit to state any material
fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading;
(xvii) provide CUSIP numbers for all Transfer
Restricted Securities not later than the effective date of the
Registration Statement and provide certificates for the
Transfer Restricted Securities;
(xviii) cooperate and assist in any filings required
to be made with the NASD and in the performance of any due
diligence investigation by any underwriter (including any
"qualified independent underwriter") that is required to be
retained in accordance with the rules and regulations of the
NASD, and use its best efforts to cause such Registration
Statement to become effective and approved by such
governmental agencies or authorities as may be necessary to
enable the Holders selling Transfer Restricted Securities to
consummate the disposition of such Transfer Restricted
Securities;
(xix) otherwise use its best efforts to comply with
all applicable rules and regulations of the Commission, and
make generally available to its security holders, a
consolidated earnings statement of the Company and its
subsidiaries (which need not be audited) complying with
Section 11(a) of the Securities Act and the rules and
regulations of the Commission thereunder (including, at the
option of the Company, Rule 158), as soon as practicable, but
in any event not later than eighteen months after (A) Transfer
Restricted Securities are sold to underwriters in a firm or
best efforts Underwritten Offering or (B) if not sold to
underwriters in such an offering, the effective date of the
Registration Statement;
<PAGE> 16
14
(xx) cause the Indenture and the Declaration to be
qualified under the TIA not later than the effective date of
the first Registration Statement required by this Agreement,
and, in connection therewith, cooperate with the Trustee and
the Holders of Securities to effect such changes to the
Indenture and the Declaration as may be required for such
Indenture and the Declaration to be so qualified in accordance
with the terms of the TIA; and execute and use their best
efforts to cause the Indenture Trustee, Guarantee Trustee and
the Property Trustee to execute, all documents that may be
required to effect such changes and all other forms and
documents required to be filed with the Commission to enable
such Indenture to be so qualified in a timely manner; and
(xxi) provide promptly to each Holder upon request
each document filed with the Commission pursuant to the
requirements of Section 13(a) and Section 15(d) of the
Exchange Act.
Each Holder agrees by acquisition of a Transfer Restricted
Security that, upon receipt of any notice from the Company or the Trust
of the existence of any fact or event of the kind described in Section
6(c)(iii)(D) hereof, such Holder will forthwith discontinue disposition
of Transfer Restricted Securities pursuant to the applicable
Registration Statement until such Holder's receipt of the copies of the
supplemented or amended Prospectus contemplated by Section 6(c)(xvi)
hereof, or until it is advised in writing (the "Advice") by the Company
or the Trust that the use of the Prospectus may be resumed, and has
received copies of any additional or supplemental filings that are
incorporated by reference in the Prospectus. If so directed by the
Company or the Trust, each Holder will deliver to the Company or the
Trust (at the Company's and the Trust's expense) all copies, other than
permanent file copies then in such Holder's possession, of the
Prospectus covering such Transfer Restricted Securities that was
current at the time of receipt of such notice. In the event the Company
or the Trust shall give any such notice, the time period regarding the
effectiveness of such Registration Statement set forth in Section 3 or
4 hereof, as applicable, shall be extended by the number of days during
the period from and including the date of the giving of such notice
pursuant to Section 6(c)(iii)(D) hereof to and including the date when
each selling Holder covered by such Registration Statement shall have
received the copies of the supplemented or amended Prospectus
contemplated by Section 6(c)(xvi) hereof or shall have received the
Advice.
7. Registration Expenses.
All expenses incident to the Company's and the Trust's
performance of or compliance with this Agreement, other than the
expenses of any Holder, will be borne by the Company and the Trust,
regardless of whether a Registration Statement becomes effective,
including without limitation: (i) all registration and filing fees and
expenses (including filings made by any Purchaser with the NASD (and,
if applicable, the fees and expenses of any "qualified independent
underwriter" and its counsel that may be required by the rules and
regulations of the NASD)); (ii) all fees and expenses of compliance
with federal securities and state Blue Sky or securities laws; (iii)
all expenses of printing (including printing certificates for the New
Securities to be issued in the Exchange Offer and printing of
Prospectuses), and associated messenger and delivery services and
telephone; (iv) all fees and disbursements of counsel for the Company
and the Trust; (v) all application and filing fees in connection with
listing Securities on a national securities exchange or automated
quotation system pursuant to the requirements hereof; and (vi) all fees
and disbursements of independent certified public
<PAGE> 17
15
accountants of the Company and the Trust (including the expenses of any
special audit and comfort letters required by or incident to such
performance).
The Company and the Trust will, in any event, bear their
internal expenses (including, without limitation, all salaries and
expenses of their officers and employees performing legal or accounting
duties), the expenses of any annual audit and the fees and expenses of
any Person, including special experts, retained by the Company or the
Trust.
8. Indemnification and Contribution.
(a) In connection with a Shelf Registration Statement or in
connection with any delivery of a Prospectus contained in an Exchange Offer
Registration Statement by any participating Broker-Dealer or Initial Purchaser,
as applicable, who seeks to sell New Securities, the Company and the Trust shall
indemnify and hold harmless each Holder of Transfer Restricted Securities
included within any such Shelf Registration Statement and each participating
Broker-Dealer or Initial Purchaser selling New Securities, and each person, if
any, who controls any such person within the meaning of Section 15 of the
Securities Act (each, a "Participant") from and against any loss, claim, damage
or liability, joint or several, or any action in respect thereof (including, but
not limited to, any loss, claim, damage, liability or action relating to
purchases and sales of Securities) to which such Participant or controlling
person may become subject, under the Securities Act or otherwise, insofar as
such loss, claim, damage, liability or action arises out of, or is based upon,
(i) any untrue statement or alleged untrue statement of a material fact
contained in any such Registration Statement or any prospectus forming part
thereof or in any amendment or supplement thereto or (ii) the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, and shall reimburse
each Participant promptly upon demand for any legal or other expenses reasonably
incurred by such Participant in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability or action as
such expenses are incurred; provided, however, that (i) the Company and the
Trust shall not be liable in any such case to the extent that any such loss,
claim, damage, liability or action arises out of, or is based upon, any untrue
statement or alleged untrue statement or omission or alleged omission made in
any such Registration Statement or any prospectus forming part thereof or in any
such amendment or supplement in reliance upon and in conformity with written
information furnished to the Company and the Trust by or on behalf of any
Participant specifically for inclusion therein; and provided further that as to
any preliminary Prospectus, the indemnity agreement contained in this Section
8(a) shall not inure to the benefit of any such Participant or any controlling
person of such Participant on account of any loss, claim, damage, liability or
action arising from the sale of the New Securities to any person by that
Participant if (i) that Participant failed to send or give a copy of the
Prospectus, as the same may be amended or supplemented, to that person within
the time required by the Securities Act and (ii) the untrue statement or alleged
untrue statement of a material fact or omission or alleged omission to state a
material fact in such preliminary Prospectus was corrected in the Prospectus,
unless, in each case, such failure resulted from non-compliance by the Company
and the Trust with Section 6(c). The foregoing indemnity agreement is in
addition to any liability which the Company and the Trust may otherwise have to
any Participant or to any controlling person of that Participant.
(b) Each Participant, severally and not jointly, shall
indemnify and hold harmless the Company and the Trust, each of its directors,
officers, employees or agents and each person, if any, who controls the Company
and the Trust within the meaning of Section 15 of the Securities Act, from and
against any loss, claim, damage or liability, joint or several, or any action in
respect thereof, to which the Company and the Trust or any such director,
officer, employees or agents or controlling person may become subject, under the
Securities Act or otherwise, insofar as such loss, claim, damage,
<PAGE> 18
16
liability or action arises out of, or is based upon, (i) any untrue statement or
alleged untrue statement of a material fact contained in any preliminary
Prospectus, Registration Statement or Prospectus or in any amendment or
supplement thereto or (ii) the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, but in each case only to the extent that the untrue
statement or alleged untrue statement or omission or alleged omission was made
in reliance upon and in conformity with written information furnished to the
Company and the Trust by or on behalf of that Participant specifically for
inclusion herein, and shall reimburse the Company and the Trust and any such
director, officer, employees or agents or controlling person for any legal or
other expenses reasonably incurred by the Company and the Trust or any such
director, officer, employees or agents or controlling person in connection with
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action as such expenses are incurred. The foregoing
indemnity agreement is in addition to any liability which any Participant may
otherwise have to the Company and the Trust or any such director, officer or
controlling person.
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of which
indemnity may be sought pursuant to either paragraph (a) or (b) above, such
person (the "indemnified party") shall promptly notify the person against whom
such indemnity may be sought (the "indemnifying party") in writing and the
indemnifying party, upon request of the indemnified party, shall retain counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party and any others the indemnifying party may designate in such proceeding and
shall pay the fees and expenses of such counsel related to such proceeding. In
any such proceeding, any indemnified party shall have the right to retain its
own counsel, but the fees and expenses of such counsel shall be at the expense
of such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate, in the reasonable judgement
of the indemnified party, because of actual or potential differing interests
between them. It is understood that the indemnifying party shall not, in respect
of the legal expenses of any indemnified party in connection with any proceeding
or related proceedings in the same jurisdiction, be liable for the fees and
expenses of more than one separate firm (in addition to any local counsel) for
(i) all Initial Purchasers and those other Participants and their respective
officers, employees and controlling persons who may be subject to liability
arising out of any claim in respect of which indemnity may be sought by the
Participants against the Company and the Trust under this Section 8 and (ii) the
Company and the Trust, their directors, their officers, employees or agents and
each person, if any, who controls the Trust and the Company within the meaning
of Section 15 of the Securities Act, and that all such fees and expenses shall
be reimbursed as they are incurred. In the case of any such separate firm for
the Initial Purchasers and such Participants, such firm shall be designated in
writing by Morgan Stanley & Co. Incorporated. In the case of any such separate
firm for the Company and the Trust, and such directors, officers, employees,
agents and control persons of the Company and the Trust, such firm shall be
designated in writing by the Company and the Trust. The indemnifying party shall
not be liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the indemnified party
from and against any loss or liability by reason of such settlement or judgment.
Notwithstanding the foregoing sentence, if at any time an indemnified party
shall have requested an indemnifying party to reimburse the indemnified party
for fees and expenses of counsel as contemplated by the second and third
sentences of this paragraph, the indemnifying party agrees that it shall be
liable for any settlement of any proceeding effected without its written consent
if (i) such settlement is entered into more than 30 days after receipt by such
indemnifying party of the aforesaid request and (ii) such indemnifying party
<PAGE> 19
17
shall not have reimbursed the indemnified party in accordance with such request
prior to the date of such settlement. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement of any
pending or threatened proceeding in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such proceeding.
(d) If the indemnification provided for in this Section 8
shall for any reason be unavailable to or insufficient to hold harmless an
indemnified party under Section 8(a) or 8(b) in respect of any loss, claim,
damage or liability, or any action in respect thereof, referred to therein, then
each indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, in such
proportion as shall be appropriate to reflect the relative fault of the Trust
and the Company on the one hand and the Participants on the other with respect
to the statements or omissions which resulted in such loss, claim, damage or
liability, or action in respect thereof, as well as any other relevant equitable
considerations. The relative fault shall be determined by reference to whether
the untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the Trust
and the Company or the Participants, the intent of the parties and their
relative knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company and the Trust and the Participants agree
that it would not be just and equitable if contributions pursuant to this
Section 8(d) were to be determined by pro rata allocation (even if the
Participants were treated as one entity for such purpose) or by any other method
of allocation which does not take into account the equitable considerations
referred to herein. The amount paid or payable by an indemnified party as a
result of the loss, claim, damage or liability, or action in respect thereof,
referred to above in this Section 8(d) shall be deemed to include, for purposes
of this Section 8(d), any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this Section 8(d), no Participant
shall be required to contribute any amount in excess of the amount by which
proceeds received by such Participant from an offering of the Notes exceeds the
amount of any damages which such Participant has otherwise paid or become liable
to pay by reason of any untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Participants' obligations to contribute as provided in
this Section 8(d) are several and not joint.
9. Rule 144A.
The Company and the Trust hereby agrees with each Holder, for
so long as any Transfer Restricted Securities remain outstanding, to make
available to any Holder or beneficial owner of Transfer Restricted Securities in
connection with any sale thereof and any prospective purchaser of such Transfer
Restricted Securities from such Holder or beneficial owner, upon request, the
information required by Rule 144A(d)(4) under the Securities Act in order to
permit resales of such Transfer Restricted Securities pursuant to Rule 144A.
10. Participation in Underwritten Registrations.
No Holder may participate in any Underwritten Registration
hereunder unless such Holder (a) agrees to sell such Holder's Transfer
Restricted Securities on the basis provided in any underwriting arrangements
approved by the Persons entitled hereunder to approve such arrangements and (b)
completes and executes all reasonable questionnaires, powers of attorney,
indemnities,
<PAGE> 20
18
underwriting agreements, lock-up letters and other documents required under the
terms of such underwriting arrangements.
11. Selection of Underwriters.
The Holders of Transfer Restricted Securities covered by the
Shelf Registration Statement who desire to do so may sell such Transfer
Restricted Securities in an Underwritten Offering. In any such Underwritten
Offering, the investment banker or investment bankers and manager or managers
that will administer the offering will be selected by the Holders of a majority
in aggregate principal amount of the Transfer Restricted Securities included in
such offering; provided, that such investment bankers and managers must be
reasonably satisfactory to the Company.
12. Miscellaneous.
(a) Remedies. The Company and the Trust agree that monetary
damages (including the Additional Interest and Additional Distributions
contemplated hereby) would not be adequate compensation for any loss
incurred by reason of a breach by it of the provisions of this
Agreement and hereby agree to waive the defense in any action for
specific performance that a remedy at law would be adequate.
(b) No Inconsistent Agreements. The Company and the Trust will
not on or after the date of this Agreement enter into any agreement
with respect to their securities that is inconsistent with the
registration rights granted to the Holders in this Agreement or
otherwise conflicts with the provisions hereof. The Company and the
Trust have not previously entered into any agreement granting any
registration rights with respect to their securities to any Person. The
rights granted to the Holders hereunder do not in any way conflict with
and are not inconsistent with the rights granted to the holders of the
Trust's and the Company's securities under any agreement in effect on
the date hereof.
(c) Adjustments Affecting the Notes. Absent the redemption of
the Securities upon the occurence of a Special Event, the Company and
the Trust will not take any action, or permit any change to occur, with
respect to Securities that would materially and adversely affect the
ability of the Holders to Consummate any Exchange Offer.
(d) Amendments and Waivers. The provisions of this Agreement
may not be amended, modified or supplemented, and waivers or consents
to or departures from the provisions hereof may not be given unless the
Company and the Trust have obtained the written consent of Holders of a
majority of the outstanding principal amount of Transfer Restricted
Securities. Notwithstanding the foregoing, a waiver or consent to
departure from the provisions hereof that relates exclusively to the
rights of Holders whose securities are being tendered pursuant to the
Exchange Offer and that does not affect directly or indirectly the
rights of other Holders whose securities are not being tendered
pursuant to such Exchange Offer may be given by the Holders of a
majority of the outstanding principal amount of Transfer Restricted
Securities being tendered or registered.
(e) Notices. All notices and other communications provided for
or permitted hereunder shall be made in writing by hand-delivery,
first-class mail (registered or certified, return receipt requested),
telex, telecopier, or air courier guaranteeing overnight delivery:
<PAGE> 21
19
(i) if to a Holder, at the address set forth on
the records of the Declaration; and
(ii) if to the Company and the Trust:
Huntington Bancshares Incorporated
Huntington Center
Columbus, Ohio 43287
Attention: Judith D. Fisher
All such notices and communications shall be deemed to have
been duly given: at the time delivered by hand, if personally
delivered; five business days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; when
receipt acknowledged, if telecopied; and on the next business day, if
timely delivered to an air courier guaranteeing overnight delivery.
Copies of all such notices, demands or other communications
shall be concurrently delivered by the Person giving the same to the
Trustee at the address specified in the Indenture.
(f) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of
the parties, including without limitation and without the need for an
express assignment, subsequent Holders of Transfer Restricted
Securities; provided, however, that this Agreement shall not inure to
the benefit of or be binding upon a successor or assign of a Holder
unless and to the extent such successor or assign acquired Transfer
Restricted Securities from such Holder.
(g) Counterparts. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and
all of which taken together shall constitute one and the same
agreement.
(h) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect
the meaning hereof.
(i) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REGARD TO THE CONFLICT OF LAW RULES THEREOF.
(j) Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any
circumstance, is held invalid, illegal or unenforceable, the validity,
legality and enforceability of any such provision in every other
respect and of the remaining provisions contained herein shall not be
affected or impaired thereby.
(k) Entire Agreement. This Agreement together with the other
transaction documents is intended by the parties as a final expression
of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in
respect of the subject matter contained herein. There are no
restrictions, promises, warranties or undertakings, other than those
set forth or referred to herein with respect to the registration
<PAGE> 22
20
rights granted by the Company and the Trust with respect to the
Transfer Restricted Securities. This Agreement supersedes all prior
agreements and understandings between the parties with respect to such
subject matter.
(l) Required Consents. Whenever the consent or approval of
Holders of a specified percentage of Transfer Restricted Securities is
required hereunder, Transfer Restricted Securities held by the Company
or its affiliates (as such term is defined in Rule 405 under the
Securities Act) shall not be counted in determining whether such
consent or approval was given by the Holders of such required
percentage.
<PAGE> 23
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
HUNTINGTON BANCSHARES
INCORPORATED
By: /s/ JUDITH D. FISHER
------------------------------------
Name: Judith D. Fisher
Title: Executive Vice President
HUNTINGTON CAPITAL I
By: /s/ PAUL V. SEBERT
------------------------------------
Name: Paul V. Sebert
Title: Regular Trustee
<PAGE> 24
Accepted as of the date thereof
Morgan Stanley & Co. Incorporated
Lehman Brothers Inc.
Salomon Brothers Inc
By MORGAN STANLEY & CO. INCORPORATED
By: /s/ MICHAEL FUSCO
-------------------------
Name: Michael Fusco
Title: Vice President
<PAGE> 1
Exhibit 5(a)
June 30, 1997
Huntington Bancshares Incorporated
41 South High Street
Columbus, Ohio 43287
Ladies and Gentlemen:
In connection with the registration under the Securities Act of 1933,
as amended (the "Act") on a Form S-4 Registration Statement (the "Registration
Statement") of $200,000,000 aggregate principal amount of Floating Rate Junior
Subordinated Debentures (the "Subordinated Debentures") of Huntington Bancshares
Incorporated, a Maryland corporation (the "Company"), $200,000,000 aggregate
liquidation amount of Floating Rate Capital Securities (the "Capital
Securities") of Huntington Capital I, a business trust created under the laws of
the State of Delaware (the "Trust"), and the Guarantee with respect to the
Capital Securities (the "Guarantee") to be executed and delivered by the Company
for the benefit of the holders from time to time of the Capital Securities, we,
as your counsel, have examined such corporate records, certificates and other
documents, and such questions of law, as we have considered necessary or
appropriate for the purposes of this opinion.
Upon the basis of such examination, we advise you that, when:
(i) The Registration Statement relating to the Subordinated
Debentures, the Capital Securities and the Guarantee has become
effective under the Act;
(ii) the Guarantee Agreement relating to the Guarantee with
respect to the Capital Securities of the Trust has been duly executed
and delivered;
(iii) the Subordinated Debentures have been duly executed and
authenticated in accordance with the Indenture and issued and delivered
as contemplated in the Registration Statement; and
(iv) the Capital Securities have been duly executed in
accordance with the Amended and Restated Declaration of Trust of the
Trust and issued and delivered as contemplated in the Registration
Statement,
the Subordinated Debentures and the Guarantee relating to the Capital
Securities of the Trust will constitute valid and legally binding obligations
of the Company, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditors' rights, to general equity principles and an implied
covenant of good faith and fair dealing.
<PAGE> 2
Huntington Bancshares Incorporated
June 30, 1997
Page 2
The foregoing opinion is limited to the laws of the State of Ohio, and
where applicable, the Federal laws of the United States and the laws of the
State of Maryland. The Subordinated Debentures and the Guarantee provide that
they shall be governed by the laws of the State of New York. For purposes of our
opinion, we have not examined the laws of the State of New York or the question
of what law would govern the interpretation or enforcement of the Subordinated
Debentures or the Guarantee. Our opinion therefore is based on and qualified by
the assumption that the internal laws of the State of New York and the State of
Ohio are in all relevant respects identical. We are expressing no opinion as to
the effect of the laws of any other jurisdiction.
We understand that you have received an opinion regarding the Capital
Securities from Richards, Layton & Finger, LLP, special Delaware counsel for the
Company and the Trust. We are expressing no opinion with respect to the
matters contained in such opinion.
Also, we have relied as to certain matters on information obtained from
public officials, officers of the Company and other sources believed by us
to be responsible.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the references to us under the heading "Legal
Matters" in the Prospectus. In giving such consent, we do not thereby admit that
we are in the category of persons whose consent is required under Section 7 of
the Act.
Very truly yours,
/s/ Porter, Wright, Morris & Arthur
PORTER, WRIGHT, MORRIS & ARTHUR
<PAGE> 1
Exhibit 5(b)
June 30, 1997
Huntington Capital I
c/o Huntington Bancshares Incorporated
Huntington Center
Columbus, Ohio 43287
RE: HUNTINGTON CAPITAL I
Ladies and Gentlemen:
We have acted as special Delaware counsel for Huntington
Bancshares Incorporated, a Mayland corporation (the "Sponsor"), and Huntington
Capital I, a Delaware business trust (the "Trust"), in connection with the
matters set forth herein. At your request, this opinion is being furnished to
you.
For purposes of giving the opinions hereinafter set forth, our
examination of documents has been limited to the examination of originals or
copies of the following:
(a) The Certificate of Trust of the Trust, dated as of
January 23, 1997 (the "Certificate"), as filed in the
office of the Secretary of State of the State of
Delaware (the "Secretary of State") on January 24,
1997;
(b) The Declaration of Trust of the Trust, dated as of
January 23, 1997, as amended by the Amended and
Restated Declaration of Trust of the Trust, dated as
of January 31, 1997 (including Exhibits A-1 and A-2
thereto), among the Sponsor, the trustees of the
Trust named therein (the "Trustees") and the holders,
from time to time, of undivided beneficial interests
in the assets of the Trust (the "Declaration");
(c) The Registration Statement (the "Registration
Statement") on Form S-4, including a prospectus with
respect to the Trust (the "Prospectus"), relating to
the Floating Rate Capital Income Securities of the
Trust representing undivided beneficial interests in
the assets of the Trust (each, a "New Capital
Security" and
<PAGE> 2
Huntington Capital Trust I
June 30, 1997
Page 2
collectively, the "New Capital Securities"), filed
by the Sponsor and the Trust with the Securities and
Exchange Commission; and
(d) A Certificate of Good Standing for the Trust, dated
June 30, 1997, obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise
defined are used as defined in the Trust Agreement.
For purposes of this opinion, we have not reviewed any
documents other than the documents listed above, and we have assumed that there
exists no provision in any document that we have not reviewed that bears upon or
is inconsistent with the opinions stated herein. We have conducted no
independent factual investigation of our own but rather have relied solely upon
the foregoing documents, the statements and information set forth therein and
the additional matters recited or assumed herein, all of which we have assumed
to be true, complete and accurate in all material respects.
With respect to all documents examined by us, we have assumed
(i) the authenticity of all documents submitted to us as authentic originals,
(ii) the conformity with the originals of all documents submitted to us as
copies or forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the
Trust Agreement constitutes the entire agreement among the parties thereto with
respect to the subject matter thereof, including with respect to the creation,
operation and termination of the Trust, and that the Trust Agreement and the
Certificate are in full force and effect and have not been amended, (ii) except
to the extent provided in paragraph 1 below, the due creation or due
organization or due formation, as the case may be, and valid existence in good
standing of each party to the documents examined by us under the laws of the
jurisdiction governing its creation, organization or formation, (iii) the legal
capacity of natural persons who are parties to the documents examined by us,
(iv) that each of the parties to the documents examined by us has the power and
authority to execute and deliver, and to perform its obligations under, such
documents, (v) the due authorization, execution and delivery by all parties
thereto of all documents examined by us, (vi) the receipt by each Person to whom
a New Capital Security is to be issued by the Trust (collectively, the "Security
Holders") of a certificate for such New Security and the payment for the New
Capital Security acquired by it, in accordance with the Trust Agreement and the
Prospectus, and (vii) that the New Capital Securities are issued and sold to the
Security Holders in accordance with the Trust Agreement and the Prospectus. We
have not participated in the preparation of the Prospectus and assume no
responsibility for its contents.
<PAGE> 3
Huntington Capital Trust I
June 30, 1997
Page 3
This opinion is limited to the laws of the State of Delaware
(excluding the securities laws of the State of Delaware), and we have not
considered and express no opinion on the laws of any other jurisdiction,
including federal laws and rules and regulations relating thereto. Our opinions
are rendered only with respect to Delaware laws and rules, regulations and
orders thereunder which are currently in effect.
Based upon the foregoing, and upon our examination of such
questions of law and statutes of the State of Delaware as we have considered
necessary or appropriate, and subject to the assumptions, qualifications,
limitations and exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly existing in
good standing as a business trust under the Business Trust Act.
2. The New Capital Securities will represent valid and,
subject to the qualifications set forth in paragraph 3 below, fully paid and
nonassessable undivided beneficial interests in the assets of the Trust.
3. The Security Holders, as beneficial owners of the Trust,
will be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware. We note that the Security Holders may
be obligated to make payments as set forth in the Trust Agreement.
We consent to the filing of this opinion with the Securities
and Exchange Commission as an exhibit to the Registration Statement. In
addition, we hereby consent to the use of our name under the heading "Legal
Matters" in the Prospectus. In giving the foregoing consents, we do not thereby
admit that we come within the category of Persons whose consent is required
under Section 7 of the Securities Act of 1933, as amended, or the rules and
regulations of the Securities and Exchange Commission thereunder. Except as
stated above, without our prior written consent, this opinion may not be
furnished or quoted to, or relied upon by, any other Person for any purpose.
Very truly yours,
Richards, Layton & Finger
<PAGE> 1
Exhibit 8
June 30, 1997
Huntington Bancshares Incorporated
41 South High Street
Columbus, Ohio 43287
Ladies and Gentlemen:
As special tax counsel to Huntington Capital I (the "Trust") and
Huntington Bancshares Incorporated in connection with the exchange offer by the
Trust of $200,000,000 of its Floating Rate Capital Securities pursuant to a
preliminary Prospectus dated June 30, 1997 (the "Prospectus"), and assuming that
the operative documents described in the Prospectus will be performed in
accordance with the terms described therein, we hereby confirm to you our
opinion as set forth under the heading "Certain United States Federal Income Tax
Consequences" in the Prospectus, subject to the limitations set forth therein.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the references to us under the hearing "Certain
United States Federal Income Tax Consequences" in the Prospectus. In giving such
consent, we do not thereby admit that we are in the category of persons whose
consent is required under Section 7 of the Act.
Very truly yours,
/s/ Porter, Wright, Morris & Arthur
PORTER, WRIGHT, MORRIS & ARTHUR
<PAGE> 1
Exhibit 12
HUNTINGTON BANCSHARES INCORPORATED
RATIO OF EARNINGS TO FIXED CHARGES
(IN THOUSANDS OF DOLLARS)
<TABLE>
<CAPTION>
Year Ended December 31
Three Months --------------------------------------------------------------
Ended
March 31, 1997 1996 1995 1994 1993 1992
------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
EXCLUDING INTEREST ON DEPOSITS
Income before taxes .............. $ 103,114 $ 398,821 $ 378,448 $ 366,474 $ 363,791 $ 233,435
Fixed charges:
Interest expense .............. 77,288 292,126 311,702 168,891 122,566 95,048
1/3 of net rent expense ....... 2,074 8,098 7,873 7,932 7,562 6,771
------------------------------------------------------------------------------
Total fixed charges ....... 79,362 300,224 319,575 176,823 130,128 101,819
------------------------------------------------------------------------------
Earnings ......................... $ 182,476 $ 699,045 $ 698,023 $ 543,297 $ 493,919 $ 335,254
==============================================================================
Fixed charges .................... $ 79,362 $ 300,224 $ 319,575 $ 176,823 $ 130,128 $ 101,819
==============================================================================
Ratio of Earnings
to Fixed Charges ............... 2.30 2.33 2.18 3.07 3.80 3.29
INCLUDING INTEREST ON DEPOSITS
Income before taxes .............. $ 103,114 $ 398,821 $ 378,448 $ 366,474 $ 363,791 $ 233,435
Fixed charges:
Interest expense .............. 193,664 751,640 737,333 463,671 440,111 504,846
1/3 of net rent expense ....... 2,074 8,098 7,873 7,932 7,562 6,771
------------------------------------------------------------------------------
Total fixed charges ....... 195,738 759,738 745,206 471,603 447,673 511,617
------------------------------------------------------------------------------
Earnings ......................... $ 298,852 $1,158,559 $1,123,654 $ 838,077 $ 811,464 $ 745,052
==============================================================================
Fixed charges .................... $ 195,738 $ 759,738 $ 745,206 $ 471,603 $ 447,673 $ 511,617
==============================================================================
Ratio of Earnings to
Fixed Charges .................. 1.53 1.52 1.51 1.78 1.81 1.46
</TABLE>
<PAGE> 1
Exhibit 23a
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement on Form S-4 and the related Prospectus of Huntington
Bancshares Incorporated for the registration of $200,000,000 Capital Securities
and to the incorporation by reference therein of our report dated January 15,
1997, with respect to the consolidated financial statements of Huntington
Bancshares Incorporated included in its Annual Report on Form 10-K for the year
ended December 31, 1996, filed with the Securities and Exchange Commission.
Ernst & Young LLP
Columbus, Ohio
June 27, 1997
<PAGE> 1
Exhibit 24
POWER OF ATTORNEY
Each of the undersigned officers and directors of Huntington Bancshares
Incorporated (the "Corporation") hereby appoints Judith D. Fisher, Ralph K.
Frasier, and Gerald R. Williams as his attorneys or any of them, with power to
act without the other, as his attorney, to sign, in his name and on his behalf
and in any and all capacities stated below, and to cause to be filed with the
Securities and Exchange Commission (the "Commission"), the Corporation's
Registration Statement on the appropriate form (the "Registration Statement")
for the purpose of registering under the Securities Act of 1933, as amended,
Capital Securities of a Delaware statutory business trust to be formed by the
Corporation (the "Trust") and Junior Subordinated Debentures of the Corporation,
to be issued and sold from time to time in one or more series, resulting in
proceeds to the Trust and to the Corporation in an aggregate principal amount
not to exceed $210 million (or such greater amount as shall result in aggregate
proceeds of $210 million if such securities are sold at an original issue
discount), and any and all amendments, including post-effective amendments, to
the Registration Statement, hereby granting unto such attorneys and each of them
full power and authority to do and perform in the name and on behalf of the
undersigned, and in any and all such capacities, every act and thing whatsoever
necessary to be done in and about the premises as fully as the undersigned could
or might do in person, hereby granting to each such attorney-in-fact full power
of substitution and revocation, and hereby ratifying all that any such
attorney-in-fact or his substitute may do by virtue hereof.
IN WITNESS WHEREOF, the undersigned have signed these presents this
23rd day of January, 1997.
<TABLE>
<CAPTION>
SIGNATURE TITLE
<S> <C>
/s/ Frank Wobst Chairman and Chief Executive Officer
- - --------------------------------- (principal executive officer)
Frank Wobst
/s/ Zuheir Sofia President, Treasurer, and Director
- - ---------------------------------
Zuheir Sofia
/s/ W. Lee Hoskins Vice Chairman and Director
- - ---------------------------------
W. Lee Hoskins
</TABLE>
<PAGE> 2
<TABLE>
<CAPTION>
SIGNATURE TITLE
<S> <C>
/s/ Gerald R. Williams Executive Vice President and Chief
- - --------------------------------- Financial Officer
Gerald R. Williams (principal financial officer
and principal accounting officer)
/s/ Don M. Casto, III Director
- - ---------------------------------
Don M. Casto, III
/s/ Don Conrad Director
- - ---------------------------------
Don Conrad
- - --------------------------------- Director
John B. Gerlach
/s/ Patricia T. Hayot Director
- - ---------------------------------
Patricia T. Hayot
/s/ Wm. J. Lhota Director
- - ---------------------------------
Wm. J. Lhota
/s/ George A. Skestos Director
- - ---------------------------------
George A. Skestos
/s/ Lewis R. Smoot Director
- - ---------------------------------
Lewis R. Smoot, Sr.
/s/ Timothy P. Smucker Director
- - ---------------------------------
Timothy P. Smucker
/s/ William J. Williams Director
- - ---------------------------------
William J. Williams
</TABLE>
<PAGE> 1
Exhibit 25(a)
-------------------------------------------------------------------
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)
--------------------------------------------------------
HUNTINGTON BANCSHARES INCORPORATED
(Exact name of obligor as specified in its charter)
MARYLAND 31-0724920
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
HUNTINGTON CENTER
41 SOUTH HIGH STREET
COLUMBUS, OHIO 43287
(Address of principal executive offices) (Zip Code)
------------
FLOATING RATE JUNIOR SUBORDINATED DEBENTURES
(Title of the indenture securities)
<PAGE> 2
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> 3
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 March 31, 1997, in
accordance with a call made by the Federal Reserve
Bank of this District pursuant to the provisions of
the Federal Reserve Act.
DOLLAR AMOUNTS
<TABLE>
<CAPTION>
ASSETS IN MILLIONS
<S> <C>
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin...................................... $ 11,721
Interest-bearing balances.............................. 3,473
Securities: ...............................................
Held to maturity securities................................. 2,965
Available for sale securities............................... 35,903
Federal Funds sold and securities purchased under
agreements to resell .................................. 24,025
Loans and lease financing receivables:
Loans and leases, net of unearned income $123,957
Less: Allowance for loan and lease losses 2,853
Less: Allocated transfer risk reserve ... 13
-----------
Loans and leases, net of unearned income,
allowance, and reserve ................................ 121,091
Trading Assets ............................................. 54,340
Premises and fixed assets (including capitalized
leases)................................................ 2,875
Other real estate owned .................................... 302
Investments in unconsolidated subsidiaries and
associated companies................................... 139
Customers' liability to this bank on acceptances
outstanding ........................................... 2,270
Intangible assets .......................................... 1,535
Other assets ............................................... 10,283
---------
TOTAL ASSETS ............................................... $270,922
=========
</TABLE>
- 4 -
<PAGE> 4
<TABLE>
<CAPTION>
LIABILITIES
<S> <C>
Deposits
In domestic offices .................................... $ 84,776
Noninterest-bearing ..........................$32,492
Interest-bearing ............................. 52,284
-------
In foreign offices, Edge and Agreement subsidiaries,
and IBF's .............................................. 69,171
Noninterest-bearing ..........................$ 4,181
Interest-bearing ..............................64,990
Federal funds purchased and securities sold under agree-
ments to repurchase ......................................... 32,885
Demand notes issued to the U.S. Treasury .................... 1,000
Trading liabilities.......................................... 42,538
Other Borrowed money (includes mortgage indebtedness
and obligations under capitalized leases):
With a remaining maturity of one year or less .......... 4,431
With a remaining maturity of more than one year ............. 466
Bank's liability on acceptances executed and outstanding 2,270
Subordinated notes and debentures ........................... 5,911
Other liabilities ........................................... 11,575
TOTAL LIABILITIES ........................................... 255,023
--------
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 ...................... 4,941
Net unrealized holding gains (Losses)
on available-for-sale securities ............................ (552)
Cumulative foreign currency translation adjustments ......... 16
TOTAL EQUITY CAPITAL ........................................ 15,899
--------
TOTAL LIABILITIES, LIMITED-LIFE PREFERRED
STOCK AND EQUITY CAPITAL ............................... $270,922
========
</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> 1
Exhibit 25(b)
-------------------------------------------------------------------
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)
---------------------------------------------
HUNTINGTON CAPITAL I
(Exact name of obligor as specified in its charter)
DELAWARE
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
C/O HUNTINGTON BANCSHARES INCORPORATED
HUNTINGTON CENTER
41 SOUTH HIGH STREET
COLUMBUS, OHIO 43287
(Address of principal executive offices) (Zip Code)
----------------------------
FLOATING RATE CAPITAL SECURITIES
(Title of the indenture securities)
<PAGE> 2
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> 3
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 25TH day of JUNE, 1997.
THE CHASE MANHATTAN BANK
By /s/ Timothy E. Burke
----------------------------
Timothy E. Burke
Second Vice President
- 3 -
<PAGE> 4
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 March 31, 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 ............................... $ 11,721
Interest-bearing balances ....................... 3,473
Securities: .........................................
Held to maturity securities... ....................... 2,965
Available for sale securities......................... 35,903
Federal Funds sold and securities purchased under
agreements to resell ............................ 24,025
Loans and lease financing receivables:
Loans and leases, net of unearned income $123,957
Less: Allowance for loan and lease losses 2,853
Less: Allocated transfer risk reserve .... 13
--------
Loans and leases, net of unearned income,
allowance, and reserve .......................... 121,091
Trading Assets ....................................... 54,340
Premises and fixed assets (including capitalized
leases).......................................... 2,875
Other real estate owned .............................. 302
Investments in unconsolidated subsidiaries and
associated companies............................. 139
Customers' liability to this bank on acceptances
outstanding ..................................... 2,270
Intangible assets .................................... 1,535
Other assets.......................................... 10,283
--------
TOTAL ASSETS ......................................... $270,922
========
</TABLE>
- 4 -
<PAGE> 5
<TABLE>
<CAPTION>
LIABILITIES
<S> <C>
Deposits
In domestic offices.................................... $84,776
Noninterest-bearing ...........................$32,492
Interest-bearing .............................. 52,284
------
In foreign offices, Edge and Agreement subsidiaries,
and IBF's ............................................. 69,171
Noninterest-bearing ...........................$ 4,181
Interest-bearing ............................. 64,990
Federal funds purchased and securities sold under agree-
ments to repurchase ........................................ 32,885
Demand notes issued to the U.S. Treasury ................... 1,000
Trading liabilities ........................................ 42,538
Other Borrowed money (includes mortgage indebtedness
and obligations under capitalized leases):
With a remaining maturity of one year or less ......... 4,431
With a remaining maturity of more than one year ............ 466
Bank's liability on acceptances executed and outstanding.... 2,270
Subordinated notes and debentures .......................... 5,911
Other liabilities .......................................... 11,575
TOTAL LIABILITIES .......................................... 255,023
-------
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 ..................... 4,941
Net unrealized holding gains (Losses)
on available-for-sale securities ........................... (552)
Cumulative foreign currency translation adjustments ........ 16
TOTAL EQUITY CAPITAL ....................................... 15,899
------
TOTAL LIABILITIES, LIMITED-LIFE PREFERRED
STOCK AND EQUITY CAPITAL .............................. $270,922
========
</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> 1
Exhibit 25(c)
-------------------------------------------------------------------
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)
----------------------------------------------------------
HUNTINGTON BANCSHARES INCORPORATED
(Exact name of obligor as specified in its charter)
MARYLAND 31-0724920
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
HUNTINGTON CENTER
41 SOUTH HIGH STREET
COLUMBUS, OHIO 43287
(Address of principal executive offices) (Zip Code)
---------------------
GUARANTEE WITH RESPECT TO THE
CAPITAL SECURITIES OF HUNTINGTON CAPITAL I
(Title of the indenture securities)
<PAGE> 2
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> 3
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 25TH day of JUNE, 1997.
THE CHASE MANHATTAN BANK
By /s/ Timothy E. Burke
----------------------------
Timothy E. Burke
Second Vice President
- 3 -
<PAGE> 4
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 March 31, 1997, in
accordance with a call made by the Federal Reserve
Bank of this District pursuant to the provisions of
the Federal Reserve Act.
DOLLAR AMOUNTS
<TABLE>
<CAPTION>
ASSETS IN MILLIONS
<S> <C>
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin ................................. $ 11,721
Interest-bearing balances ......................... 3,473
Securities:.............................................
Held to maturity securities............................. 2,965
Available for sale securities........................... 35,903
Federal Funds sold and securities purchased under
agreements to resell............................... 24,025
Loans and lease financing receivables:
Loans and leases, net of unearned income $123,957
Less: Allowance for loan and lease losses 2,853
Less: Allocated transfer risk reserve .... 13
--------
Loans and leases, net of unearned income,
allowance, and reserve ............................ 121,091
Trading Assets.......................................... 54,340
Premises and fixed assets (including capitalized
leases)............................................ 2,875
Other real estate owned ................................ 302
Investments in unconsolidated subsidiaries and
associated companies............................... 139
Customers' liability to this bank on acceptances
outstanding ....................................... 2,270
Intangible assets ...................................... 1,535
Other assets ........................................... 10,283
------
TOTAL ASSETS............................................ $270,922
=========
</TABLE>
- 4 -
<PAGE> 5
<TABLE>
<CAPTION>
LIABILITIES
<S> <C>
Deposits
In domestic offices.................................... $ 84,776
Noninterest-bearing...........................$32,492
Interest-bearing ............................. 52,284
-------
In foreign offices, Edge and Agreement subsidiaries,
and IBF's........................................ 69,171
Noninterest-bearing ..........................$ 4,181
Interest-bearing ............................. 64,990
Federal funds purchased and securities sold under agree-
ments to repurchase......................................... 32,885
Demand notes issued to the U.S. Treasury ................... 1,000
Trading liabilities......................................... 42,538
Other Borrowed money (includes mortgage indebtedness
and obligations under capitalized leases):
With a remaining maturity of one year or less ......... 4,431
With a remaining maturity of more than one year ............ 466
Bank's liability on acceptances executed and outstanding 2,270
Subordinated notes and debentures .......................... 5,911
Other liabilities........................................... 11,575
TOTAL LIABILITIES .......................................... 255,023
--------
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 ..................... 4,941
Net unrealized holding gains (Losses)
on available-for-sale securities............................ (552)
Cumulative foreign currency translation adjustments ........ 16
TOTAL EQUITY CAPITAL ....................................... 15,899
--------
TOTAL LIABILITIES, LIMITED-LIFE PREFERRED
STOCK AND EQUITY CAPITAL............................... $270,922
========
</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> 1
Exhibit 99(a)
LETTER OF TRANSMITTAL
HUNTINGTON CAPITAL I
OFFER TO EXCHANGE ITS
FLOATING RATE CAPITAL SECURITIES
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
WHICH HAVE BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933
FOR ANY AND ALL OF ITS OUTSTANDING
FLOATING RATE CAPITAL SECURITIES
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
PURSUANT TO THE PROSPECTUS
DATED _________, 1997
- - --------------------------------------------------------------------------------
THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL
EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON ___________, 1997,
UNLESS THE OFFER IS EXTENDED.
- - --------------------------------------------------------------------------------
----------------------
THE EXCHANGE AGENT FOR THE EXCHANGE OFFER IS:
THE CHASE MANHATTAN BANK
BY REQUIRED OR CERTIFIED MAIL: BY HAND OR OVERNIGHT DELIVERY:
- - --------------------------------- ------------------------------
THE CHASE MANHATTAN BANK THE CHASE MANHATTAN BANK
450 WEST 33RD STREET, 15TH FLOOR 450 WEST 33RD STREET, 15TH FLOOR
NEW YORK, NEW YORK 10001 NEW YORK, NEW YORK 10001
ATTENTION: GLOBAL TRUST SERVICES ATTENTION: GLOBAL TRUST SERVICES
CONFIRM BY TELEPHONE:
--------------------
(212) 946-3042
FACSIMILE TRANSMISSIONS:
-----------------------
(ELIGIBLE INSTITUTIONS ONLY)
(212) 946-8154
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS
OTHER THAN AS SET FORTH ABOVE OR TRANSMISSION OF THIS
LETTER OF TRANSMITTAL VIA FACSIMILE TO A NUMBER OTHER
THAN AS SET FORTH ABOVE DOES NOT CONSTITUTE A VALID DELIVERY
THE INSTRUCTIONS CONTAINED HEREIN SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED
<PAGE> 2
Capitalized terms used but not defined herein shall have the same
meaning given them in the Prospectus (as defined below).
This Letter of Transmittal is to be completed by holders of Old Capital
Securities (as defined below) either if Old Capital Securities are to be
forwarded herewith or if tenders of Old Capital Securities are to be made by
book-entry transfer to an account maintained by The Chase Manhattan Bank (the
"Exchange Agent") at The Depository Trust Company ("DTC") pursuant to the
procedures set forth in "The Exchange Offer -- Procedures for Tendering Old
Capital Securities" in the Prospectus and an Agent's Message (as defined herein)
is not delivered.
Holders of Old Capital Securities whose certificates (the
"Certificates") for such Old Capital Securities are not immediately available or
who cannot deliver their Certificates and all other required documents to the
Exchange Agent on or prior to the Expiration Date (as defined in the Prospectus)
or who cannot complete the procedures for book-entry transfer on a timely basis
must tender their Old Capital Securities according to the guaranteed delivery
procedures set forth in "The Exchange Offer -- Procedures for Tendering Old
Capital Securities" in the Prospectus.
DELIVERY OF DOCUMENTS TO DTC DOES NOT CONSTITUTE DELIVERY TO THE
EXCHANGE AGENT.
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
ALL TENDERING HOLDERS COMPLETE THIS BOX:
<TABLE>
<CAPTION>
- - ----------------------------------------------------------------------------------------------------------------------
DESCRIPTION OF OLD CAPITAL SECURITIES
- - ----------------------------------------------------------------------------------------------------------------------
If blank, please print name and address Old Capital Securities tendered
of registered holder (Attach additional list if necessary)
- - ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
Aggregate Liquidation Amount
Liquidation Amount of Old Capital
Certificate of Old Capital Securities Tendered
Number(s)* Securities (if less than all)
----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------
----------------------------------------------------------------------
TOTAL
AMOUNT
TENDERED:
- - ----------------------------------------------------------------------------------------------------------------------
* Need not be completed by book-entry holders.
- - ----------------------------------------------------------------------------------------------------------------------
</TABLE>
2
<PAGE> 3
(BOXES BELOW TO BE CHECKED BY ELIGIBLE INSTITUTIONS ONLY)
[ ] CHECK HERE IF TENDERED OLD CAPITAL SECURITIES ARE BEING DELIVERED BY
BOOK-ENTRY TRANSFER MADE TO THE ACCOUNT MAINTAINED BY THE EXCHANGE
AGENT WITH DTC AND COMPLETE THE FOLLOWING:
Name of Tendering Institution
-----------------------------------------
DTC Account Number
----------------------------------------------------
Transaction Code Number
-----------------------------------------------
[ ] CHECK HERE AND ENCLOSE A PHOTOCOPY OF THE NOTICE OF GUARANTEED
DELIVERY IF TENDERED OLD CAPITAL SECURITIES ARE BEING DELIVERED
PURSUANT TO A NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE
EXCHANGE AGENT AND COMPLETE THE FOLLOWING:
Name of Registered Holder(s)
------------------------------------------
Window Ticket Number (if any)
-----------------------------------------
Date of Execution of Notice of Guaranteed Delivery
--------------------
Name of Institution which Guaranteed Delivery
-------------------------
If Guaranteed Delivered is to be made By Book-Entry Transfer.
Name of Tendering Institution
-----------------------------------------
DTC Account Number
----------------------------------------------------
Transaction Code Number
-----------------------------------------------
[ ] CHECK HERE IF TENDERED BY BOOK-ENTRY TRANSFER AND NON-EXCHANGED OLD
CAPITAL SECURITIES ARE TO BE RETURNED BY CREDITING THE DTC ACCOUNT
NUMBER SET FORTH ABOVE.
[ ] CHECK HERE IF YOU ARE A BROKER-DEALER WHO ACQUIRED THE OLD CAPITAL
SECURITIES FOR ITS OWN ACCOUNT AS A RESULT OF MARKET MAKING OR OTHER
TRADING ACTIVITIES (A "PARTICIPATING BROKER-DEALER") AND WISH TO
RECEIVE 10 ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY
AMENDMENTS OR SUPPLEMENTS THERETO.
Name:
-----------------------------------------------------------------
Address:
--------------------------------------------------------------
3
<PAGE> 4
Ladies and Gentlemen:
The undersigned hereby tenders to Huntington Capital I, a statutory
business trust formed under the laws of the State of Delaware (the "Trust"), and
Huntington Bancshares Incorporated, a Maryland corporation (the "Corporation"),
the above described aggregate Liquidation Amount of the Trust's Floating Rate
Capital Securities (the "Old Capital Securities") in exchange for a like
aggregate Liquidation Amount of the Trust's Floating Rate Capital Securities
(the "New Capital Securities") which have been registered under the Securities
Act of 1933 (the "Securities Act"), upon the terms and subject to the conditions
set forth in the Prospectus dated June 30, 1997 (as the same may be amended or
supplemented from time to time, the "Prospectus"), receipt of which is
acknowledged, and in this Letter of Transmittal (which, together with the
Prospectus, constitute the "Exchange Offer").
Subject to and effective upon the acceptance for exchange of all or any
portion of the Old Capital Securities tendered herewith in accordance with the
terms and conditions of the Exchange Offer (including, if the Exchange Offer is
extended or amended, the terms and conditions of any such extension or
amendment), the undersigned hereby sells, assigns and transfers to or upon the
order of the Trust all right, title and interest in and to such Old Capital
Securities as are being tendered herewith. The undersigned hereby irrevocably
constitutes and appoints the Exchange Agent as its agent and attorney-in-fact
(with full knowledge that the Exchange Agent is also acting as agent of the
Corporation and the Trust in connection with the Exchange Offer) with respect to
the tendered Old Capital Securities, with full power of substitution (such power
of attorney being deemed to be an irrevocable power coupled with an interest),
subject only to the right of withdrawal described in the Prospectus, to (i)
deliver Certificates for Old Capital Securities to the Corporation or the Trust
together with all accompanying evidences of transfer and authenticity to, or
upon the order of, the Trust, upon receipt by the Exchange Agent as the
undersigned's agent, of the New Capital Securities to be issued in exchange for
such Old Capital Securities, (ii) present Certificates for such Old Capital
Securities for transfer, and to transfer the Old Capital Securities on the books
of the Trust, and (iii) receive for the account of the Trust all benefits and
otherwise exercise all rights of beneficial ownership of such Old Capital
Securities, all in accordance with the terms and conditions of the Exchange
Offer.
THE UNDERSIGNED HEREBY REPRESENTS AND WARRANTS THAT THE UNDERSIGNED HAS
FULL POWER AND AUTHORITY TO TENDER, EXCHANGE, SELL, ASSIGN AND TRANSFER THE OLD
CAPITAL SECURITIES TENDERED HEREBY AND THAT, WHEN THE SAME ARE ACCEPTED FOR
EXCHANGE, THE TRUST WILL ACQUIRE GOOD, MARKETABLE AND UNENCUMBERED TITLE
THERETO, FREE AND CLEAR OF ALL LIENS, RESTRICTIONS, CHARGES AND ENCUMBRANCES,
AND THAT THE OLD CAPITAL SECURITIES TENDERED HEREBY ARE NOT SUBJECT TO ANY
ADVERSE CLAIMS OR PROXIES. THE UNDERSIGNED WILL, UPON REQUEST, EXECUTE AND
DELIVER ANY ADDITIONAL DOCUMENTS DEEMED BY THE TRUST OR THE EXCHANGE AGENT TO BE
NECESSARY OR DESIRABLE TO COMPLETE THE EXCHANGE, SALE, ASSIGNMENT AND TRANSFER
OF THE OLD CAPITAL SECURITIES TENDERED HEREBY, AND THE UNDERSIGNED WILL COMPLY
WITH ITS OBLIGATIONS UNDER THE REGISTRATION RIGHTS AGREEMENT (AS DEFINED IN THE
PROSPECTUS). THE UNDERSIGNED HAS READ AND AGREES TO ALL OF THE TERMS OF THE
EXCHANGE OFFER.
The name(s) and address(es) of the registered holder(s) of the Old
Capital Securities tendered hereby should be printed above, if they are not
already set forth above, as they appear on the Certificates representing such
Old Capital Securities. The Certificate number(s) and the Old Capital Securities
that the undersigned wishes to tender should be indicated in the appropriate
boxes above.
If any tendered Old Capital Securities are not exchanged pursuant to
the Exchange Offer for any reason, or if Certificates are submitted for more Old
Capital Securities than are tendered or accepted for exchange, Certificates for
such nonexchanged or nontendered Old Capital Securities will be returned (or, in
the case of Old Capital Securities tendered by book-entry transfer, such Old
Capital Securities will be credited to an account maintained at DTC), without
expense to the tendering holder, promptly following the expiration or
termination of the Exchange Offer.
The undersigned understands that tenders of Old Capital Securities
pursuant to any one of the procedures described in "The Exchange Offer --
Procedures for Tendering Old Capital Securities" in the Prospectus and in the
instruction will, upon the Trust's acceptance for exchange of such tendered Old
Capital Securities, constitute a binding agreement between the undersigned and
the Trust upon the terms and subject to the conditions of the Exchange Offer.
The undersigned recognizes that, under certain circumstances set forth in the
Prospectus, the Trust may not be required to accept for exchange any of the Old
Capital Securities tendered hereby.
4
<PAGE> 5
Unless otherwise indicated herein in the box entitled "Special Issuance
Instructions" below, the undersigned hereby directs that the New Capital
Securities be issued in the name(s) of the undersigned or, in the case of a
book-entry transfer of Old Capital Securities, that such New Capital Securities
be credited to the account indicated above maintained at DTC. If applicable,
substitute Certificates representing Old Capital Securities not exchanged or not
accepted for exchange will be issued to the undersigned or, in the case of a
book-entry transfer of Old Capital Securities, will be credited to the account
indicated above maintained at DTC. Similarly, unless otherwise indicated under
"Special Delivery Instructions" below, please deliver New Capital Securities to
the undersigned at the address shown below the undersigned's signature.
BY TENDERING OLD CAPITAL SECURITIES AND EXECUTING THIS LETTER OF
TRANSMITTAL, THE UNDERSIGNED HEREBY REPRESENTS AND AGREES THAT (I) THE
UNDERSIGNED IS NOT AN "AFFILIATE" OF THE CORPORATION OR THE TRUST WITHIN THE
MEANING OF RULE 405 UNDER THE SECURITIES ACT, (II) ANY NEW CAPITAL SECURITIES TO
BE RECEIVED BY THE UNDERSIGNED ARE BEING ACQUIRED IN THE ORDINARY COURSE OF ITS
BUSINESS, (III) THE UNDERSIGNED HAS NO ARRANGEMENT OR UNDERSTANDING WITH ANY
PERSON TO PARTICIPATE IN A DISTRIBUTION (WITHIN THE MEANING OF THE SECURITIES
ACT) OF NEW CAPITAL SECURITIES TO BE RECEIVED IN THE EXCHANGE OFFER, AND (IV) IF
THE UNDERSIGNED IS NOT A BROKER-DEALER, THE UNDERSIGNED IS NOT ENGAGED IN, AND
DOES NOT INTEND TO ENGAGE IN, A DISTRIBUTION (WITHIN THE MEANING OF THE
SECURITIES ACT) OF SUCH NEW CAPITAL SECURITIES. BY TENDERING OLD CAPITAL
SECURITIES PURSUANT TO THE EXCHANGE OFFER AND EXECUTING THIS LETTER OF
TRANSMITTAL, A HOLDER OF OLD CAPITAL SECURITIES WHICH IS A BROKER-DEALER
REPRESENTS AND AGREES, CONSISTENT WITH CERTAIN INTERPRETIVE LETTERS ISSUED BY
THE STAFF OF THE DIVISION OF CORPORATION FINANCE OF THE SECURITIES AND EXCHANGE
COMMISSION TO THIRD PARTIES, THAT (A) SUCH OLD CAPITAL SECURITIES HELD BY THE
BROKER-DEALER ARE HELD ONLY AS A NOMINEE, OR (B) SUCH OLD CAPITAL SECURITIES
WERE ACQUIRED BY SUCH BROKER-DEALER FOR ITS OWN ACCOUNT AS A RESULT OF
MARKET-MAKING ACTIVITIES OR OTHER TRADING ACTIVITIES AND IT WILL DELIVER A
PROSPECTUS (AS AMENDED OR SUPPLEMENTED FROM TIME TO TIME) MEETING THE
REQUIREMENTS OF THE SECURITIES ACT IN CONNECTION WITH ANY RESALE OF SUCH NEW
CAPITAL SECURITIES (PROVIDED THAT, BY SO ACKNOWLEDGING AND BY DELIVERING A
PROSPECTUS, SUCH BROKER-DEALER WILL NOT BE DEEMED TO ADMIT THAT IT IS AN
"UNDERWRITER" WITHIN THE MEANING OF THE SECURITIES ACT).
THE CORPORATION AND THE TRUST HAVE AGREED THAT, SUBJECT TO THE
PROVISIONS OF THE REGISTRATION RIGHTS AGREEMENT, THE PROSPECTUS, AS IT MAY BE
AMENDED OR SUPPLEMENTED FROM TIME TO TIME, MAY BE USED BY A PARTICIPATING
BROKER-DEALER (AS DEFINED BELOW) IN CONNECTION WITH RESALES OF NEW CAPITAL
SECURITIES RECEIVED IN EXCHANGE FOR OLD CAPITAL SECURITIES, WHERE SUCH OLD
CAPITAL SECURITIES WERE ACQUIRED BY SUCH PARTICIPATING BROKER-DEALER FOR ITS OWN
ACCOUNT AS A RESULT OF MARKET-MAKING ACTIVITIES OR OTHER TRADING NAMES, FOR A
PERIOD ENDING 180 DAYS AFTER THE EXPIRATION DATE (SUBJECT TO EXTENSION UNDER
CERTAIN LIMITED CIRCUMSTANCES DESCRIBED IN THE PROSPECTUS) OR, IF EARLIER, WHEN
ALL SUCH NEW CAPITAL SECURITIES HAVE BEEN DISPOSED OF BY SUCH PARTICIPATING
BROKER-DEALER. IN THAT REGARD, EACH BROKER-DEALER WHO ACQUIRED OLD CAPITAL
SECURITIES FOR ITS OWN ACCOUNT AS A RESULT OF MARKET-MAKING OR OTHER TRADING
ACTIVITIES (A "PARTICIPATING BROKER-DEALER"), BY TENDERING SUCH OLD CAPITAL
SECURITIES AND EXECUTING THIS LETTER OF TRANSMITTAL OR DELIVERING AN AGENT'S
MESSAGE IN LIEU THEREOF, AGREES THAT, UPON RECEIPT OF NOTICE FROM THE
CORPORATION OR THE TRUST OF THE OCCURRENCE OF ANY EVENT OR THE DISCOVERY OF ANY
FACT WHICH MAKES ANY STATEMENT CONTAINED OR INCORPORATED BY REFERENCE IN THE
PROSPECTUS UNTRUE IN ANY MATERIAL RESPECT OR WHICH CAUSES THE PROSPECTUS TO OMIT
TO STATE A MATERIAL FACT NECESSARY IN ORDER TO MAKE THE STATEMENTS CONTAINED OR
INCORPORATED BY REFERENCE THEREIN, IN LIGHT OF THE CIRCUMSTANCES UNDER WHICH
THEY WERE MADE, NOT MISLEADING OR OF THE OCCURRENCE OF CERTAIN OTHER EVENTS
SPECIFIED IN THE REGISTRATION RIGHTS AGREEMENT, SUCH PARTICIPATING BROKER-DEALER
WILL SUSPEND THE SALE OF NEW CAPITAL SECURITIES (OR THE NEW GUARANTEE OR THE NEW
SUBORDINATED DEBENTURES, AS APPLICABLE) PURSUANT TO THE PROSPECTUS UNTIL THE
CORPORATION OR THE TRUST HAS AMENDED OR SUPPLEMENTED THE PROSPECTUS TO CORRECT
SUCH MISSTATEMENT OR OMISSION AND HAS FURNISHED COPIES OF THE AMENDED OR
SUPPLEMENTED PROSPECTUS TO THE PARTICIPATING BROKER-DEALER OR THE CORPORATION OR
THE TRUST HAS GIVEN NOTICE THAT THE SALE OF THE NEW CAPITAL SECURITIES (OR THE
NEW GUARANTEE OR THE NEW SUBORDINATED DEBENTURES, AS APPLICABLE) MAY BE RESUMED,
AS THEY CAN BE. IF THE CORPORATION OR THE TRUST GIVES SUCH NOTICE TO SUSPEND
THE SALE OF THE NEW CAPITAL SECURITIES, IT SHALL EXTEND THE 180-DAY PERIOD
REFERRED TO ABOVE DURING WHICH PARTICIPATING BROKER-DEALERS ARE ENTITLED TO USE
THE PROSPECTUS IN CONNECTION WITH THE RESALE OF NEW CAPITAL SECURITIES BY THE
NUMBER OF DAYS DURING THE PERIOD FROM AND INCLUDING THE DATE OF THE GIVING OF
SUCH NOTICE TO AND INCLUDING THE DATE WHEN PARTICIPATING BROKER-DEALERS SHALL
HAVE RECEIVED COPIES OF THE SUPPLEMENTED OR AMENDED PROSPECTUS NECESSARY TO
PERMIT RESALES OF THE NEW CAPITAL SECURITIES OR TO AND INCLUDING THE DATE ON
WHICH THE CORPORATION OR THE TRUST HAS GIVEN NOTICE THAT THE SALE OF NEW CAPITAL
SECURITIES (OR THE NEW GUARANTEE OR THE NEW SUBORDINATED DEBENTURES, AS
APPLICABLE) MAY BE RESUMED, AS THE CASE MAY BE.
5
<PAGE> 6
As a result, a Participating Broker-Dealer who intends to use the
Prospectus in connection with resales of New Capital Securities received in
exchange for Old Capital Securities pursuant to the Exchange Offer must notify
the Corporation or the Trust, or cause the Corporation or the Trust to be
notified, on or prior to the Expiration Date, that it is a Participating
Broker-Dealer. Such notice may be given in the space provided above or may be
delivered to the Exchange Agent at the address set forth in the Prospectus under
"The Exchange Offer -- Exchange Agent."
Holders of Old Capital Securities whose Old Capital Securities are
accepted for exchange will not receive accumulated Distributions on such Old
Capital Securities for any period from and after the last Distribution Date with
respect to such Old Capital Securities prior to the original issue date of the
New Capital Securities and will be deemed to have waived the right to receive
any Distributions on such Old Capital Securities accumulated from and after such
Distribution Date.
The undersigned will, upon request, execute and deliver any additional
documents deemed by the Trust or the Exchange Agent to be necessary or desirable
to complete the exchange, sale, assignment and transfer of the Old Capital
Securities tendered hereby. All authority herein conferred or agreed to be
conferred in this Letter of Transmittal shall survive the death or incapacity of
the undersigned and any obligation of the undersigned hereunder shall be binding
upon the heirs, executors, administrators, representatives, trustees in
bankruptcy, legal representatives, successors and assigns of the undersigned.
Except as stated in the Prospectus, this tender is irrevocable.
6
<PAGE> 7
HOLDER(S) SIGN HERE
(SEE INSTRUCTIONS 2, 5 AND 6)
(NOTE: SIGNATURE(S) MUST BE GUARANTEED IF REQUIRED BY INSTRUCTION 2)
Must be signed by registered holder(s) exactly as name(s) appear(s) on
Certificate(s) for the Old Capital Securities hereby tendered or on a security
position listing, or by any person(s) authorized to become the registered
holder(s) by endorsements and documents transmitted herewith (including such
opinions of counsel, certificates and other information as may be required by
the Trust or the Exchange Agent to comply with the restrictions on transfer
applicable to the Old Capital Securities). If signature is by an
attorney-in-fact, executor, administrator, trustee, guardian, officer of a
corporation or another acting in a fiduciary capacity or representative
capacity, please set forth the signer's full title. See Instruction 5.
- - --------------------------------------------------------------------------------
- - --------------------------------------------------------------------------------
(Signature(s) of Holder(s))
Date , 1997
-----------------------------
Name(s)
-------------------------------------------------------------------------
(Please Print)
Area Code(s) and Telephone Number
----------------------------------------------
- - --------------------------------------------------------------------------------
(Tax Identification or Social Security Number(s))
GUARANTEE OF SIGNATURE(S)
(SEE INSTRUCTIONS 2 AND 5)
Authorized Signature
-----------------------------------------------------------
Name
---------------------------------------------------------------------------
(Please Print)
Date , 1997
-----------------------------
Capacity or Title
--------------------------------------------------------------
Name of Firm
-------------------------------------------------------------------
Address
------------------------------------------------------------------------
(Include Zip Code)
Area Code and Telephone Number
-------------------------------------------------
7
<PAGE> 8
SPECIAL ISSUANCE INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5 AND 6)
To be completed ONLY if New Capital Securities and/or any Old Capital
Securities that are not tendered are to be issued in the name of someone other
than the registered holder of the Old Capital Securities whose name(s) appear(s)
above.
Issue:
[ ] New Capital Securities to:
[ ] Old Capital Securities not tendered to:
Name
---------------------------------------------------------------------------
(Please Print)
Address
------------------------------------------------------------------------
- - --------------------------------------------------------------------------------
- - --------------------------------------------------------------------------------
(Include Zip Code)
- - --------------------------------------------------------------------------------
(Taxpayer Identification or Social Security No.)
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5 AND 6)
To be completed ONLY if New Capital Securities and/or any Old Capital
Securities that are not tendered are to be sent to someone other than the
registered holder of the Old Capital Securities whose name(s) appear(s) above,
or to the registered holder(s) at an address other than that shown above.
Mail:
[ ] New Capital Securities to:
[ ] Old Capital Securities not tendered to:
Name
---------------------------------------------------------------------------
(Please Print)
Address
------------------------------------------------------------------------
- - --------------------------------------------------------------------------------
- - --------------------------------------------------------------------------------
(Include Zip Code)
- - --------------------------------------------------------------------------------
(Taxpayer Identification or Social Security No.)
8
<PAGE> 9
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE EXCHANGE OFFER
1. DELIVERY OF LETTER OF TRANSMITTAL AND CERTIFICATES; GUARANTEED
DELIVERY PROCEDURES. This Letter of Transmittal is to be completed either if (a)
tenders are to be made pursuant to the procedures for tender by book-entry
transfer set forth in "The Exchange Offer -- Procedures for Tendering Old
Capital Securities" in the Prospectus and an Agent's Message is not delivered or
(b) Certificates are to be forwarded herewith. Timely confirmation of a
book-entry transfer of such Old Capital Securities into the Exchange Agent's
account at DTC (a "book-entry confirmation"), or Certificates as well as this
Letter of Transmittal (or facsimile thereof) properly completed and duly
executed, with any required signature guarantees, and any other documents
required by this Letter of Transmittal, must be received by the Exchange Agent
at its addresses set forth herein on or prior to the Expiration Date. Tenders by
book-entry transfer may also be made by delivering an Agent's Message in lieu of
this Letter of Transmittal. The term "Agent's Message" means a message,
transmitted by DTC to and received by the Exchange Agent and forming a part of a
book-entry confirmation, which states that DTC has received an express
acknowledgment from the DTC participant, which acknowledgment states that such
participant has received and agrees to be bound by the Letter of Transmittal
(including the representations contained herein) and that the Trust and the
Corporation may enforce the Letter of Transmittal against such participant.
Holders who wish to tender their Old Capital Securities and (i) who
cannot complete the procedures for delivery by book-entry transfer on a timely
basis, (ii) who cannot deliver their Old Capital Securities, this Letter of
Transmittal and all other required documents to the Exchange Agent on or prior
to the Expiration Date or (iii) whose Old Capital Securities are not immediately
available, may tender their Old Capital Securities by properly completing and
duly executing a Notice of Guaranteed Delivery pursuant to the guaranteed
delivery procedures set forth in "The Exchange Offer -- Procedures for Tendering
Old Capital Securities" in the Prospectus. Pursuant to such procedures: (a) such
tender must be made by or through an Eligible Institution (as defined below);
(b) a properly completed and duly executed Notice of Guaranteed Delivery,
substantially in the form accompanying this Letter of Transmittal, must be
received by the Exchange Agent on or prior to the Expiration Date; and (c) the
Certificates (or a book-entry confirmation) representing tendered Old Capital
Securities, in proper form for transfer, together with a Letter of Transmittal
(or facsimile thereof or Agent's Message in lieu thereof), properly completed
and duly executed, with any required signature guarantees and any other
documents required by this Letter of Transmittal, must be received by the
Exchange Agent within three New York Stock Exchange trading days after the date
of execution of such Notice of Guaranteed Delivery, all as provided in "The
Exchange Offer -- Procedures for Tendering Old Capital Securities" in the
Prospectus.
The Notice of Guaranteed Delivery may be delivered by hand or
transmitted by facsimile or mail to the Exchange Agent, and must include a
guarantee by an Eligible Institution in the form set forth in such Notice. For
Old Capital Securities to be properly tendered pursuant to the guaranteed
delivery procedure, the Exchange Agent must receive a Notice of Guaranteed
Delivery on or prior to the Expiration Date. As used herein and in the
Prospectus, "Eligible Institution" means a firm or other entity identified in
Rule 17Ad-15 under the Exchange Act as "an eligible guarantor institution,"
including (as such terms are defined therein) (i) a bank; (ii) a broker, dealer,
municipal securities broker or dealer or government securities broker or dealer,
(iii) a credit union, (iv) a national securities exchange, registered securities
association or clearing agency, or (v) a savings association that is a
participant in a Securities Transfer Association.
THE METHOD OF DELIVERY OF CERTIFICATES, THIS LETTER OF TRANSMITTAL AND
ALL OTHER REQUIRED DOCUMENTS IS AT THE OPTION AND SOLE RISK OF THE TENDERING
HOLDER AND THE DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE
EXCHANGE AGENT. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT
REQUESTED, PROPERLY INSURED, OR OVERNIGHT DELIVERY SERVICE IS RECOMMENDED. IN
ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.
Neither the Corporation nor the Trust will accept any alternative,
conditional or contingent tenders. Each tendering holder, by execution of a
Letter of Transmittal (or facsimile thereof), waives any right to receive any
notice of the acceptance of such tender.
2. GUARANTEE OF SIGNATURES. No signature guarantee on this
Letter of Transmittal is required if:
(i) this Letter of Transmittal is signed by the registered
holder (which term, for purposes of this document, shall include any
participant in DTC whose name appears on a security position listing as
the owner
9
<PAGE> 10
of the Old Capital Securities) of Old Capital Securities tendered
herewith, unless such holder(s) has completed either the box entitled
"Special Issuance Instructions" or the box entitled "Special Delivery
Instructions" above, or
(ii) such Old Capital Securities are transferred for the
account of a firm that is an Eligible Institution.
In all other cases, an Eligible Institution must guarantee the
signature(s) on this Letter of Transmittal. See Instruction 5.
3. INADEQUATE SPACE. If the space provided in the box captioned
"Description of Old Capital Securities" is inadequate, the Certificate number(s)
and/or the Liquidation Amount of Old Capital Securities and any other required
information should be listed on a separate signed schedule which is attached to
this Letter of Transmittal.
4. PARTIAL TENDERS AND WITHDRAWAL RIGHTS. If less than all the Old
Capital Securities evidenced by any Certificate submitted are to be tendered,
fill in the Liquidation Amount of Old Capital Securities which are to be
tendered in the box entitled "Liquidation Amount of Old Capital Securities
Tendered." In such case, new Certificate(s) for the remainder of the Old Capital
Securities that were evidenced by your old Certificate(s) will be sent to the
holder of the Old Capital Securities, promptly after the Expiration Date, unless
the appropriate boxes on this Letter of Transmittal are completed. All Old
Capital Securities represented by Certificates delivered to the Exchange Agent
will be deemed to have been tendered unless otherwise indicated.
Except as otherwise provided herein, tenders of Old Capital Securities
may be withdrawn at any time on or prior to the Expiration Date. In order for a
withdrawal to be effective on or prior to that time, a written, telegraphic,
telex or facsimile transmission of such notice of withdrawal must be timely
received by the Exchange Agent at one of its addresses set forth above or in the
Prospectus on or prior to the Expiration Date. Any such notice of withdrawal
must specify the name of the person who tendered the Old Capital Securities to
be withdrawn, the aggregate Liquidation Amount of Old Capital Securities to be
withdrawn, and (if Certificates for Old Capital Securities have been tendered)
the name of the registered holder of the Old Capital Securities as set forth on
the Certificates for the Old Capital Securities, if different from that of the
person who tendered such Old Capital Securities. If Certificates for the Old
Capital Securities have been delivered or otherwise identified to the Exchange
Agent, then prior to the physical release of such Certificates for the Old
Capital Securities, the tendering holder must submit the serial numbers shown on
the particular Certificates for the Old Capital Securities to be withdrawn and
the signature on the notice of withdrawal must be guaranteed by an Eligible
Institution, except in the case of Old Capital Securities tendered for the
account of an Eligible Institution. If Old Capital Securities have been tendered
pursuant to the procedures for book-entry transfer set forth in "The Exchange
Offer -- Procedures for Tendering Old Capital Securities," the notice of
withdrawal must specify the name and number of the account at DTC to be credited
with the withdrawal of Old Capital Securities, in which case a notice of
withdrawal will be effective if delivered to the Exchange Agent by written,
telegraphic, telex or facsimile transmission on or prior to the Expiration Date.
Withdrawals of tenders of Old Capital Securities may not be rescinded. Old
Capital Securities properly withdrawn will not be deemed validly tendered for
purposes of the Exchange Offer, but may be retendered at any subsequent time on
or prior to the Expiration Date by following any of the procedures described in
the Prospectus under "The Exchange Offer -- Procedures for Tendering Old Capital
Securities."
All questions as to the validity, form and eligibility (including time
of receipt) of such withdrawal notices will be determined by the Trust, in its
sole discretion, whose determination shall be final and binding on all parties.
Neither the Corporation, the Trust, any affiliates or assigns of the Corporation
or the Trust, the Exchange Agent nor any other person shall be under any duty to
give any notification of any irregularities in any notice of withdrawal or incur
any liability for failure to give any such notification. Any Old Capital
Securities which have been tendered but which are withdrawn will be returned to
the holder thereof without cost to such holder promptly after withdrawal.
5. SIGNATURES ON LETTER OF TRANSMITTAL, ASSIGNMENTS AND ENDORSEMENTS.
If this Letter of Transmittal is signed by the registered holder(s) of the Old
Capital Securities tendered hereby, the signature(s) must correspond exactly
with the name(s) written on the face of the Certificate(s) without alteration,
enlargement or any change whatsoever.
If any of the Old Capital Securities tendered hereby are owned of
record by two or more joint owners, all such owners must sign this Letter of
Transmittal.
10
<PAGE> 11
If any tendered Old Capital Securities are registered in different
name(s) on several Certificates, it will be necessary to complete, sign and
submit as many separate Letters of Transmittal (or facsimiles thereof) as there
are different registrations of Certificates.
If this Letter of Transmittal or any Certificates or bond powers are
signed by trustees, executors, administrators, guardians, attorneys-in-fact,
officers of corporations or others acting in a fiduciary or representative
capacity, such persons should so indicate when signing and must submit proper
evidence satisfactory to the Corporation and the Trust, in their sole
discretion, of such persons' authority to so act.
When this Letter of Transmittal is signed by the registered owner(s) of
the Old Capital Securities listed and transmitted hereby, no endorsement(s) of
Certificate(s) or separate bond power(s) are required unless New Capital
Securities are to be issued in the name of a person other than the registered
holder(s). Signature(s) on such Certificate(s) or bond power(s) must be
guaranteed by an Eligible Institution.
If this Letter of Transmittal is signed by a person other than the
registered owner(s) of the Old Capital Securities listed, the Certificates must
be endorsed or accompanied by appropriate bond powers, signed exactly as the
name or names of the registered owner(s) appear(s) on the Certificates, and also
must be accompanied by such opinions of counsel, certifications and other
information as the Trust or the Exchange Agent may require in accordance with
the restrictions on transfer applicable to the Old Capital Securities.
Signatures on such Certificates or bond powers must be guaranteed by an Eligible
Institution.
6. SPECIAL ISSUANCE AND DELIVERY INSTRUCTIONS. If New Capital
Securities are to be issued in the name of a person other than the signer of
this Letter of Transmittal, or if New Capital Securities are to be sent to
someone other than the signer of this Letter of Transmittal or to an address
other than that shown above, the appropriate boxes on this Letter of Transmittal
should be completed. Certificates for Old Capital Securities not exchanged will
be returned by mail or, if tendered by book-entry transfer, by crediting the
account indicated above maintained at DTC unless the appropriate boxes on this
Letter of Transmittal are completed. See Instruction 4.
7. IRREGULARITIES. The Corporation and the Trust will determine, in
their sole discretion, all questions as to the form of documents, validity,
eligibility (including time of receipt) and acceptance for exchange of any
tender of Old Capital Securities, which determination shall be final and binding
on all parties. The Corporation and the Trust reserve the absolute right, in
their sole and absolute discretion, to reject any and all tenders determined by
them not to be in proper form or the acceptance of which, or exchange for, may,
in the view of counsel to the Corporation and the Trust, be unlawful. The
Corporation and the Trust also reserve the absolute right, subject to applicable
law, to waive any of the conditions of the Exchange Offer set forth in the
Prospectus under "The Exchange Offer -- Conditions to the Exchange Offer" or any
conditions or irregularity in any tender of Old Capital Securities of any
particular holder whether or not similar conditions or irregularities are waived
in the case of other holders. The Corporation's and the Trust's interpretation
of the terms and conditions of the Exchange Offer (including the Letter of
Transmittal and the instructions hereto) will be final and binding. No tender of
Old Capital Securities will be deemed to have been validly made until all
irregularities with respect to such tender have been cured or waived. Neither
the Corporation, the Trust, any affiliates or assigns of the Corporation, the
Trust, the Exchange Agent, nor any other person shall be under any duty to give
notification of any irregularities in tenders or incur any liability for failure
to give such notification.
8. QUESTIONS, REQUESTS FOR ASSISTANCE AND ADDITIONAL COPIES. Questions
and requests for assistance may be directed to the Exchange Agent at its address
and telephone number set forth on the front of this Letter of Transmittal.
Additional copies of the Prospectus, this Letter of Transmittal and the Notice
of Guaranteed Delivery may be obtained from the Exchange Agent or from your
broker, dealer, commercial bank, trust company or other nominee.
9. WAIVER OF CONDITIONS. The Corporation and the Trust reserve the
absolute right, subject to applicable law, to waive satisfaction of any or all
conditions enumerated in the Prospectus.
10. NO CONDITIONAL TENDERS. No alternative, conditional or contingent
tenders will be accepted. All tendering holders of Old Capital Securities, by
execution of this Letter of Transmittal, shall waive any right to receive notice
of the acceptance of Old Capital Securities for exchange.
Neither the Corporation, the Trust, the Exchange Agent nor any other
person is obligated to give notice of any defect or irregularity with respect to
any tender of Old Capital Securities nor shall any of them incur any liability
for failure to give any such notice.
11. LOST, DESTROYED OR STOLEN CERTIFICATES. If any Certificate(s)
representing Old Capital Securities have been lost, destroyed or stolen, the
holder should promptly notify the Exchange Agent. The holder will then be
instructed
11
<PAGE> 12
as to the steps that must be taken in order to replace the Certificate(s). This
Letter of Transmittal and related documents cannot be processed until the
procedures for replacing lost, destroyed or stolen Certificate(s) have been
followed.
12. SECURITY TRANSFER TAXES. Holders who tender their Old Capital
Securities for exchange will not be obligated to pay any transfer taxes in
connection therewith. If, however, New Capital Securities are to be delivered
to, or are to be issued in the name of, any person other than the registered
holder of the Old Capital Securities tendered, or if a transfer tax is imposed
for any reason other than the exchange of Old Capital Securities in connection
with the Exchange Offer, then the amount of any such transfer tax (whether
imposed on the registered holder or any other persons) will be payable by the
tendering holder. If satisfactory evidence of payment of such taxes or exemption
therefrom is not submitted with the Letter of Transmittal, the amount of such
transfer taxes will be billed directly to such tendering holder.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR FACSIMILE THEREOF) AND ALL
OTHER REQUIRED DOCUMENTS MUST BE RECEIVED BY THE EXCHANGE AGENT ON OR PRIOR TO
THE EXPIRATION DATE.
12
<PAGE> 1
EXHIBIT 99(b)
NOTICE OF GUARANTEED DELIVERY
FOR TENDER OF
FLOATING RATE CAPITAL SECURITIES
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
OF
HUNTINGTON CAPITAL I
This Notice of Guaranteed Delivery, or one substantially equivalent to
this form, must be used to accept the Exchange Offer (as defined below) if (i)
the procedures for delivery by book-entry transfer cannot be completed on a
timely basis (ii) certificates for the Trust's (as defined below) Floating Rate
Capital Securities (the "Old Capital Securities") are not immediately available
or (iii) Old Capital Securities, the Letter of Transmittal and all other
required documents cannot be delivered to The Chase Manhattan Bank (the
"Exchange Agent") on or prior to the Expiration Date (as defined in the
Prospectus referred to below). This Notice of Guaranteed Delivery may be
delivered by hand, overnight courier or mail, or transmitted by facsimile
transmission, to the Exchange Agent. See "The Exchange Offer -- Procedures for
Tendering Old Capital Securities" in the Prospectus.
THE EXCHANGE AGENT FOR THE EXCHANGE OFFER IS:
THE CHASE MANHATTAN BANK
BY REGISTERED OR CERTIFIED MAIL: BY HAND OR OVERNIGHT DELIVERY
- - -------------------------------- -----------------------------
The Chase Manhattan Bank The Chase Manhattan Bank
450 West 33rd Street, 15th Floor 450 West 33rd Street, 15th Floor
New York, New York 10001 New York, New York 10001
Attention: Global Trust Services Attention: Global Trust Services
CONFIRM BY TELEPHONE:
---------------------
(212) 946-3042
FACSIMILE TRANSMISSIONS:
------------------------
(ELIGIBLE INSTITUTIONS ONLY)
(212) 946-8154
Delivery of the Notice of Guaranteed Delivery to an address other than
as set forth above or transmission of this Notice of Guaranteed Delivery via a
facsimile to a number other than as set forth above will not constitute a valid
delivery.
This Notice of Guaranteed Delivery is not to be used to guarantee
signatures. If a signature on a Letter of Transmittal is required to be
guaranteed by an "Eligible Institution" under the instructions thereto, such
signature guarantee must appear in the applicable space provided in the
signature box on the Letter of Transmittal.
<PAGE> 2
Ladies and Gentlemen:
The undersigned hereby tenders to Huntington Capital I, a statutory
business trust formed under the laws of the State of Delaware (the "Trust"),
upon the terms and subject to the conditions set forth in the Prospectus dated
June 30, 1997 (as the same may be amended or supplemented from time to time, the
"Prospectus"), and the related Letter of Transmittal (which together constitute
the "Exchange Offer"), receipt of which is hereby acknowledged, the aggregate
Liquidation Amount of Old Capital Securities set forth below pursuant to the
guaranteed delivery procedures set forth in the Prospectus under the caption
"The Exchange Offer -- Procedures for Tendering Old Capital Securities."
<TABLE>
<S> <C>
Aggregate Liquidation Amount Name(s) of Registered Holder(s):
Tendered:
-------------------------------- ---------------------------------------
Certificate No(s) (if available): Address(es):
--------
- - ----------------------------------------- ---------------------------------------
---------------------------------------
If Old Capital Securities will be tendered by Area Code and Telephone Number(s):
book-entry transfer, provide the following -----
information: ---------------------------------------
DTC Account Number: Signature(s):
---------------------- ---------------------------
Date: -----------------------------------------
------------------------------------ -----------------------------------------
</TABLE>
2
<PAGE> 3
THE GUARANTEE ON THE NEXT PAGE MUST BE COMPLETED
GUARANTEE
(NOT TO BE USED SIGNATURE GUARANTEE)
The undersigned, a firm or other entity identified in Rule 17Ad-15
under the Securities Exchange Act of 1934, as amended, as an "eligible guarantor
institution," including (as such terms are defined therein): (1) a bank; (2) a
broker, dealer, municipal securities broker, municipal securities dealer,
government securities broker, government securities dealer; (3) a credit union;
(4) a national securities exchange, registered securities association or
clearing agency; or (5) a savings association that is a participant in a
Securities Transfer Association recognized program (each of the foregoing being
referred to as an "Eligible Institution"), hereby guarantees to deliver to the
Exchange Agent, at one of its addresses set forth above, either the Old Capital
Securities tendered hereby in proper form for transfer, or confirmation of the
book-entry transfer of such Old Capital Securities to the Exchange Agent's
account at The Depository Trust Company ("DTC"), pursuant to the procedures for
book-entry transfer set forth in the Prospectus, in either case together with
one or more properly completed and duly executed Letter(s) of Transmittal (or
facsimile thereof) and any other required documents within three New York Stock
Exchange trading days after the date of execution of this Notice of Guaranteed
Delivery.
The undersigned acknowledges that it must deliver the Letter(s) of
Transmittal and the Old Capital Securities tendered hereby to the Exchange Agent
within the time period set forth above and that failure to do so could result in
a financial loss to the undersigned.
Name of Firm:____________________________ _____________________________
(Authorized Signature)
Address:_________________________________ Title:_______________________
________________________________________ Name:________________________
(Zip Code) (Please type or print)
Area Code and
Telephone Number:_______________________ Date:_______________________
NOTE: DO NOT SEND OLD CAPITAL SECURITIES WITH THIS NOTICE OF GUARANTEED
DELIVERY. ACTUAL SURRENDER OF OLD CAPITAL SECURITIES MUST BE MADE PURSUANT TO,
AND BE ACCOMPANIED BY, A PROPERLY COMPLETED AND DULY EXECUTED LETTER OF
TRANSMITTAL AND ANY OTHER REQUIRED DOCUMENTS.
3
