<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE , 1998
REGISTRATION NO. 333-
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
-------------
AMERICAN EXPRESS COMPANY AMERICAN EXPRESS COMPANY CAPITAL TRUST I
(EXACT NAME OF REGISTRANT AS AMERICAN EXPRESS COMPANY CAPITAL TRUST II
SPECIFIED IN ITS CHARTER) (EXACT NAME OF EACH REGISTRANT AS SPECIFIED
IN ITS CHARTER)
NEW YORK DELAWARE
(STATE OR OTHER JURISDICTION) (STATE OR OTHER JURISDICTION)
13-4922250 51-6508487
51-6508488
(I.R.S. EMPLOYER (I.R.S. EMPLOYER IDENTIFICATION NUMBER)
IDENTIFICATION NUMBER)
200 VESEY STREET 200 VESEY STREET
NEW YORK, NEW YORK 10285 NEW YORK, NEW YORK 10285
(212) 640-2000 (212) 640-2000
(ADDRESS, INCLUDING ZIP CODE, (ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE
AND TELEPHONE NUMBER, INCLUDING AREA CODE
NUMBER, INCLUDING AREA CODE OF OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
REGISTRANT'S PRINCIPAL -------------
EXECUTIVE OFFICES)
LOUISE M. PARENT, ESQ.
EXECUTIVE VICE PRESIDENT AND GENERAL COUNSEL
AMERICAN EXPRESS COMPANY
200 VESEY STREET
NEW YORK, NEW YORK 10285
(212) 640-2000
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE
NUMBER, AREA CODE, OF AGENT FOR SERVICE
WITH COPIES TO:
KENNETH L. BACHMAN MARK J. WELSHIMER
CLEARY, GOTTLIEB, STEEN & SULLIVAN & CROMWELL
HAMILTON 125 BROAD STREET
2000 PENNSYLVANIA AVENUE, N.W. NEW YORK, NY 10004
WASHINGTON, D.C. 20006 (212) 558-4000
(202) 974-1500 -------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this Registration Statement.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [_]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, please check the following box. [X]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act of 1933, please check the
following box and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering. [_]
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
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CALCULATION OF REGISTRATION FEE
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<TABLE>
<CAPTION>
PROPOSED PROPOSED
AMOUNT MAXIMUM MAXIMUM
TITLE OF EACH CLASS OF TO BE OFFERING PRICE AGGREGATE AMOUNT OF
SECURITIES TO BE REGISTERED REGISTERED PER UNIT(1) OFFERING PRICE REGISTRATION FEE
- --------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Junior Subordinated
Deferrable Interest
Debentures of American
Express Company(2).... $500,000,000 $ $500,000,000 N/A
- --------------------------------------------------------------------------------------------
Capital Securities of
American Express
Company Capital Trust I
and American Express
Company Capital Trust
II.................... $500,000,000 $ $500,000,000 $147,500
- --------------------------------------------------------------------------------------------
American Express Company
Guarantees with respect
to Capital
Securities(3)(4)...... N/A N/A N/A N/A
- --------------------------------------------------------------------------------------------
Total.................. $500,000,000(5) 100% $500,000,000(5) $147,500
- --------------------------------------------------------------------------------------------
</TABLE>
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(1) Estimated solely for the purpose of computing the registration fee.
(2) The Junior Subordinated Deferrable Interest Debentures will be purchased
by American Express Company Capital Trust I and American Express Company
Capital Trust II with the proceeds of the sale of the Capital Securities.
(3) No separate consideration will be received for American Express Company
Guarantees.
(4) This Registration Statement is deemed to cover the Junior Subordinated
Deferrable Interest Debentures of American Express Company, the rights of
holders of Junior Subordinated Deferrable Interest Debentures of American
Express Company under the Indenture, the rights of holders of Capital
Securities of American Express Company Capital Trust I and American
Express Company Capital Trust II under each Trust Agreement, the rights of
holders of the Capital Securities under the Guarantees and the Expense
Agreements, which taken together, fully irrevocably and unconditionally
guarantee all of the respective obligations of American Express Company
Capital Trust I and American Express Company Capital Trust II under the
Capital Securities.
(5) Such amount represents the principal amount of Junior Subordinated
Deferrable Interest Debentures issued at their principal amount and the
issue price rather than the principal amount of Junior Subordinated
Deferrable Interest Debentures issued at an original issue discount. Such
amount also represents the initial public offering price of the American
Express Company Capital Trust I and American Express Company Capital Trust
II Capital Securities.
-------------
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, AS AMENDED, 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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<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE +
+SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY +
+OFFERS TO BUY BE ACCEPTED WITHOUT THE DELIVERY OF A FINAL PROSPECTUS +
+SUPPLEMENT AND ACCOMPANYING PROSPECTUS. THIS PROSPECTUS SUPPLEMENT AND THE +
+ACCOMPANYING PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE +
+SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE +
+SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE +
+UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF +
+ANY SUCH STATE. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED , 1998
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED , 1998
$
AMERICAN EXPRESS COMPANY CAPITAL TRUST I
% CAPITAL SECURITIES, SERIES I
(LIQUIDATION AMOUNT $1,000 PER CAPITAL SECURITY)
FULLY AND UNCONDITIONALLY GUARANTEED, AS DESCRIBED HEREIN, BY
AMERICAN EXPRESS COMPANY
LOGO
-----------
The % Capital Securities, Series I (the "Capital Securities"), offered
hereby represent beneficial interests in American Express Company Capital Trust
I, a statutory business trust created under the laws of the State of Delaware
(the "Issuer"). American Express Company, a New York corporation (the
"Corporation"), will be the owner of all of the beneficial interests
represented by common securities of the Issuer (the "Common Securities" and,
collectively with the Capital Securities, the "Trust Securities"). Bankers
Trust Company is the Property Trustee of the Issuer. The Issuer exists for the
sole purpose of issuing the Trust Securities and investing the proceeds thereof
in $ initial principal amount of % Junior Subordinated Deferrable Interest
Debentures (the "Junior Subordinated Debentures"), to be issued by the
Corporation and engaging in only those other activities necessary or incidental
thereto. The Subordinated Debentures will mature on , 2028, which date may
be shortened to a date not earlier than , 2013.
(Continued on next page)
SEE "RISK FACTORS" BEGINNING ON PAGE S-5 HEREOF FOR CERTAIN INFORMATION
RELEVANT TO AN INVESTMENT IN THE CAPITAL SECURITIES.
-----------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR
THE PROSPECTUS TO WHICH IT RELATES.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
-----------
<TABLE>
<CAPTION>
INITIAL PUBLIC UNDERWRITING PROCEEDS TO
OFFERING PRICE(1) COMMISSION(2) THE ISSUER(3)(4)
----------------- ------------- ----------------
<S> <C> <C> <C>
Per Capital Security................... $1,000 (3) $1,000
Total.................................. $ (3) $
</TABLE>
- -----
(1) Plus accrued Distributions, if any, from the date of original issuance.
(2) The Issuer and the Corporation have each agreed to indemnify the several
Underwriters against certain liabilities, including liabilities under the
Securities Act of 1933, as amended. See "Underwriting".
(3) In view of the fact that the proceeds of the sale of the Capital Securities
will be invested in the Junior Subordinated Debentures, the Corporation has
agreed to pay to the Underwriters as compensation ("Underwriters'
Compensation") for their arranging the investment therein of such proceeds
$ per Capital Security (or $ in the aggregate). See "Underwriting".
(4) Expenses of the offering which are payable by the Corporation are estimated
to be $ .
-----------
The Capital Securities offered hereby are offered severally by the
Underwriters, as specified herein, subject to receipt and acceptance by them
and subject to their right to reject any order in whole or in part. It is
expected that the Capital Securities will be ready for delivery in book-entry
form only through the facilities of The Depository Trust Company in New York,
New York, on or about , 1998, against payment therefor in immediately
available funds. See "Underwriting".
-----------
The date of this Prospectus Supplement is , 1998
<PAGE>
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE CAPITAL
SECURITIES, INCLUDING OVER-ALLOTMENT, STABILIZING AND SHORT COVERING
TRANSACTIONS IN SUCH SECURITIES, AND THE IMPOSITION OF A PENALTY BID, DURING
AND AFTER THE OFFERING. FOR A DESCRIPTION OF THESE ACTIVITIES, SEE
"UNDERWRITING".
----------------
(cover page continued)
The Capital Securities will have a preference under certain circumstances with
respect to cash distributions and amounts payable on liquidation, redemption
or otherwise over the Common Securities. See "Description of Capital
Securities--Subordination of Common Securities" in the accompanying
Prospectus.
Holders of the Capital Securities will be entitled to receive preferential
cumulative cash distributions accruing from the date of original issuance and
payable semi-annually in arrears on the first day of and of each
year, commencing on , 1998, at the annual rate of % of the Liquidation
Amount of $1,000 per Capital Security ("Distributions"). Subject to certain
exceptions, as described herein, the Corporation has the right to defer
payment of interest on the Junior Subordinated Debentures at any time or from
time to time for a period not exceeding 10 consecutive semi-annual periods
with respect to each deferral period (each, an "Extension Period"), provided
that no Extension Period may extend beyond the Stated Maturity of the Junior
Subordinated Debentures. Upon the termination of any such Extension Period and
the payment of all interest then accrued and unpaid (together with interest
thereon at the rate of % per annum, compounded semi-annually, to the extent
permitted by applicable law), the Corporation may elect to begin a new
Extension Period subject to the requirements set forth herein. If interest
payments on the Junior Subordinated Debentures are so deferred, Distributions
on the Capital Securities will also be deferred and the Corporation will not
be permitted, subject to certain exceptions described herein, to declare or
pay any cash distributions with respect to the Corporation's capital stock or
debt securities that rank pari passu with or junior to the Junior Subordinated
Debentures. During an Extension Period, interest on the Junior Subordinated
Debentures will continue to accrue (and the amount of Distributions to which
holders of the Capital Securities are entitled will accumulate) at the rate of
% per annum, compounded semi-annually from the relevant payment date for such
interest, and holders of Capital Securities will be required to accrue
interest income for United States federal income tax purposes. See "Certain
Terms of Junior Subordinated Debentures--Option to Defer Interest Payments"
and "U.S. Federal Income Tax Consequences--Interest Income and Original Issue
Discount".
The Junior Subordinated Debentures are unsecured and subordinated to all
Senior Debt (as defined in the accompanying Prospectus). Substantially all of
the Corporation's existing indebtedness constitutes Senior Debt. Because the
Corporation is a holding company, the right of the Corporation to participate
in any distribution of assets of any subsidiary, including American Express
Travel Related Services Company, Inc., American Express Financial Corporation
and American Express Bank Ltd., upon such subsidiary's liquidation or
reorganization or otherwise (and, thus, the ability of holders of Capital
Securities to benefit indirectly from such distribution), is subject to the
prior claims of creditors of that subsidiary except to the extent that the
Corporation may itself be recognized as a creditor of that subsidiary.
Accordingly, the Junior Subordinated Debentures (and therefore the Capital
Securities) will be effectively subordinated to all existing and future
liabilities of the Corporation's subsidiaries, and holders thereof should look
only to the assets of the Corporation for payments on the Junior Subordinated
Debentures. See "Description of Junior Subordinated Debentures--Subordination"
in the accompanying Prospectus.
S-2
<PAGE>
(cover page continued)
The Corporation has, through the Guarantee, the Trust Agreement, the Junior
Subordinated Debentures, the Indenture and the Expense Agreement (each as
defined herein), taken together, fully, irrevocably and unconditionally
guaranteed all of the Issuer's obligations under the Capital Securities. See
"Relationship Among the Capital Securities, the Corresponding Junior
Subordinated Debentures, the Expense Agreement and the Guarantees--Full and
Unconditional Guarantee" in the accompanying Prospectus. The Guarantee of the
Corporation guarantees the payment of Distributions and payments on
liquidation or redemption of the Capital Securities, but only in each case to
the extent of funds held by the Issuer, as described herein (the "Guarantee").
See "Description of Guarantees" in the accompanying Prospectus. If the
Corporation does not make interest payments on the Junior Subordinated
Debentures held by the Issuer, the Issuer will have insufficient funds to pay
Distributions on the Capital Securities. The Guarantee does not cover payment
of Distributions when the Issuer has insufficient funds to pay such
Distributions. In such event, a holder of Capital Securities may institute a
legal proceeding directly against the Corporation pursuant to the terms of the
Indenture to enforce payment of amounts equal to such Distributions to such
holder. See "Description of Junior Subordinated Debentures--Enforcement of
Certain Rights By Holders of Capital Securities" in the accompanying
Prospectus. The obligations of the Corporation under the Guarantee and the
Capital Securities are subordinate and junior in right of payment to all
Senior Debt of the Corporation.
The Capital Securities are subject to mandatory redemption, in whole or in
part, upon repayment of the Junior Subordinated Debentures at maturity or
their earlier redemption. The Junior Subordinated Debentures are redeemable
prior to maturity at the option of the Corporation (i) on or after ,
2008, in whole at any time or in part from time to time or (ii) at any time
prior to , 2008 in whole (but not in part) at any time within 90 days
following the occurrence and continuation of a Tax Event or an Investment
Company Event (each as defined herein), in each case at the redemption price
set forth herein, which includes the accrued and unpaid interest on the Junior
Subordinated Debentures so redeemed to the date fixed for redemption.
The Corporation will have the right at any time to terminate the Issuer and
cause the Junior Subordinated Debentures to be distributed to the holders of
the Capital Securities in liquidation of the Issuer.
In the event of the termination of the Issuer, after satisfaction of
liabilities to creditors of the Issuer as required by applicable law, the
holders of the Capital Securities will be entitled to receive a Liquidation
Amount of $1,000 per Capital Security plus accumulated and unpaid
Distributions thereon to the date of payment, which may be in the form of a
distribution of such amount in Junior Subordinated Debentures, subject to
certain exceptions. See "Description of Capital Securities--Liquidation
Distribution Upon Termination" in the accompanying Prospectus.
The Capital Securities will be represented by global certificates registered
in the name of The Depository Trust Company ("DTC") or its nominee. Beneficial
interests in the Capital Securities will be shown on, and transfers thereof
will be effected only through, records maintained by participants in DTC.
Except as described in the accompanying Prospectus, Capital Securities in
certificated form will not be issued in exchange for the global certificates.
See "Book-Entry Issuance" in the accompanying Prospectus.
The information in this Prospectus Supplement supplements and should be read
in conjunction with the information contained in the accompanying Prospectus.
As used herein, (i) the "Indenture" means the Junior Subordinated Indenture,
as amended and supplemented from time to time, between the Corporation and
Bankers Trust Company, as trustee (the "Debenture Trustee"), (ii) the "Trust
Agreement" means the Amended and Restated Trust Agreement relating to the
Issuer among the Corporation, as Depositor, Bankers Trust Company, as Property
Trustee (the "Property Trustee") and
S-3
<PAGE>
Bankers Trust (Delaware), as Delaware Trustee (the "Delaware Trustee")
(collectively, the "Issuer Trustees") and (iii) the "Guarantee" means the
Guarantee Agreement relating to the Capital Securities, as amended and
supplemented from time to time, between the Corporation and Bankers Trust
Company, as Guarantee Trustee. Each of the other capitalized terms used in
this Prospectus Supplement and not otherwise defined in this Prospectus
Supplement has the meaning set forth in the accompanying Prospectus.
S-4
<PAGE>
RISK FACTORS
Prospective purchasers of the Capital Securities should carefully review the
information contained elsewhere in this Prospectus Supplement and in the
accompanying Prospectus and should particularly consider the following
matters. In addition, because holders of Capital Securities may receive Junior
Subordinated Debentures in exchange therefor upon liquidation of the Issuer,
prospective purchasers of Capital Securities are also making an investment
decision with regard to the Junior Subordinated Debentures and should
carefully review all the information regarding the Junior Subordinated
Debentures contained herein.
RANKING OF SUBORDINATED OBLIGATIONS UNDER THE GUARANTEE AND THE JUNIOR
SUBORDINATED DEBENTURES
The obligations of the Corporation under the Guarantee issued by the
Corporation for the benefit of the holders of Capital Securities and under the
Junior Subordinated Debentures are unsecured and rank subordinate and junior
in right of payment to all Senior Debt of the Corporation. Substantially all
of the Corporation's existing indebtedness constitutes Senior Debt. Because
the Corporation is a holding company, the right of the Corporation to
participate in any distribution of assets of any subsidiary, including
American Express Travel Related Services Company, Inc., American Express
Financial Corporation and American Express Bank Ltd., upon such subsidiary's
liquidation or reorganization or otherwise (and, thus, the ability of holders
of the Capital Securities to benefit indirectly from such distribution), is
subject to the prior claims of creditors of that subsidiary, except to the
extent that the Corporation may itself be recognized as a creditor of that
subsidiary. Accordingly, the Junior Subordinated Debentures (and, therefore,
the Capital Securities) will be effectively subordinated to all existing and
future liabilities of the Corporation's subsidiaries, and holders thereof
should look only to the assets of the Corporation for payments on the Junior
Subordinated Debentures. See "The Corporation". None of the Indenture, the
Guarantee, the Trust Agreement or the Expense Agreement places any limitation
on the amount of secured or unsecured debt, including Senior Debt, that may be
incurred by the Corporation. See "Description of Guarantees--Status of the
Guarantees" and "Description of Junior Subordinated Debentures--Subordination"
in the accompanying Prospectus.
The ability of the Issuer to pay amounts due on the Capital Securities is
solely dependent upon the Corporation making payments on the Junior
Subordinated Debentures as and when required.
OPTION TO EXTEND INTEREST PAYMENT PERIOD; TAX CONSEQUENCES
So long as no event of default under the Indenture has occurred or is
continuing, the Corporation has the right under the Indenture to defer payment
of interest on the Junior Subordinated Debentures at any time or from time to
time for a period not exceeding 10 consecutive semi-annual periods with
respect to each Extension Period, provided that no Extension Period may extend
beyond the Stated Maturity of the Junior Subordinated Debentures. As a
consequence of any such deferral, semi-annual Distributions on the Capital
Securities by the Issuer will also be deferred (and the amount of
Distributions to which holders of the Capital Securities are entitled will
accumulate additional Distributions thereon at the rate of % per annum,
compounded semi-annually from the relevant payment date for such
Distributions) during any such Extension Period. During any Extension Period,
the Corporation may not (i) declare or pay any dividends or distributions on,
or redeem, purchase, acquire, or make a liquidation payment with respect to,
any of the Corporation's capital stock or (ii) make any payment of principal
of or interest or premium, if any, on or repay, repurchase or redeem any debt
securities of the Corporation that rank pari passu in all respects with or
junior in interest to the Junior Subordinated Debentures (other than (a)
repurchases, redemptions or other acquisitions of shares of capital stock of
the Corporation in connection with any employment contract, benefit plan or
other similar arrangement with or for the benefit of one or more employees,
officers, directors or
S-5
<PAGE>
consultants, in connection with a dividend reinvestment or stockholder stock
purchase plan or in connection with the issuance of capital stock of the
Corporation (or securities convertible into or exercisable for such capital
stock) as consideration in an acquisition transaction entered into prior to
the applicable Extension Period, (b) as a result of any exchange or conversion
of any class or series of the Corporation's capital stock (or any capital
stock of a subsidiary of the Corporation) for any class or series of the
Corporation's capital stock or of any class or series of the Corporation's
indebtedness for any class or series of the Corporation's capital stock, (c)
the purchase of fractional interests in shares of the Corporation's capital
stock pursuant to the conversion or exchange provisions of such capital stock
or the security being converted or exchanged, (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 ranks pari
passu with or junior to such stock). Prior to the termination of any such
Extension Period, the Corporation may further defer the payment of interest,
provided that no Extension Period may exceed 10 consecutive semi-annual
periods or extend beyond the Stated Maturity of the Junior Subordinated
Debentures. Upon the termination of any Extension Period and the payment of
all interest then accrued and unpaid (together with interest thereon at the
annual rate of %, compounded semi-annually from the relevant Interest Payment
Date (as defined herein) for such interest, to the extent permitted by
applicable law), the Corporation may elect to begin a new Extension Period
subject to the above requirements. There is no limitation on the number of
times that the Corporation may elect to begin an Extension Period. See
"Certain Terms of Capital Securities--Distributions" and "Certain Terms of
Junior Subordinated Debentures--Option to Defer Interest Payments".
Should an Extension Period occur, a holder of Capital Securities will be
required to recognize income (in the form of original issue discount on a
constant yield method) in respect of its pro rata share of the Junior
Subordinated Debentures held by the Issuer for United States federal income
tax purposes. As a result, a holder of Capital Securities will be required to
include such income in gross income for United States federal income tax
purposes in advance of the receipt of cash attributable to such income, and
will not receive the cash related to such income from the Issuer if the holder
disposes of the Capital Securities prior to the record date for the payment of
Distributions. See "U.S. Federal Income Tax Consequences--Interest Income and
Original Issue Discount" and "--Sale or Redemption of Capital Securities".
The Corporation has no current intention of exercising its right to defer
payments of interest by extending the interest payment period on the Junior
Subordinated Debentures. However, should the Corporation elect to exercise
such right in the future, the market price of the Capital Securities is likely
to be affected. A holder that disposes of its Capital Securities during an
Extension Period, therefore, might not receive the same return on its
investment as a holder that continues to hold its Capital Securities.
TAX EVENT OR INVESTMENT COMPANY EVENT--REDEMPTION
Upon the occurrence and continuation of a Tax Event or an Investment Company
Event, the Corporation has the right to redeem the Junior Subordinated
Debentures in whole (but not in part) within 90 days following the occurrence
and continuation of such Tax Event or Investment Company Event and thereby
cause a mandatory redemption of the Capital Securities. See "U.S. Federal
Income Tax Consequences--Possible Tax Law Changes".
A "Tax Event" means the receipt by the Issuer of an opinion of 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
S-6
<PAGE>
political subdivision or taxing authority thereof or therein, or (b) any
judicial decision or any official administrative pronouncement (including any
private letter ruling, technical advice memorandum or field service advice) or
regulatory procedure (an "Administrative Action"), regardless of whether such
judicial decision or Administrative Action is issued to or in connection with
a proceeding involving the Corporation or the Issuer and whether or not
subject to review or appeal, which amendment, clarification, change,
Administrative Action or decision is enacted, promulgated or announced, in
each case, on or after the date of this Prospectus Supplement, there is more
than an insubstantial risk that (i) the Issuer is, or will be within 90 days
of the date of such opinion, subject to United States federal income tax with
respect to income received or accrued on the Junior Subordinated Debentures,
(ii) interest payable by the Corporation on the Junior Subordinated Debentures
is not, or within 90 days of such opinion, will not be, deductible by the
Corporation, in whole or in part, for United States federal income tax
purposes, or (iii) the Issuer is, or will be within 90 days of the date of the
opinion, subject to more than a de minimis amount of other taxes, duties or
other governmental charges.
"Investment Company Event" means the receipt by the Issuer 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 or a written change (including any
announced prospective change) in interpretation or application of law or
regulation by any legislative body, court, governmental agency or regulatory
authority, there is more than an insubstantial risk that the Issuer is or will
be considered an "investment company" that is required to be registered under
the Investment Company Act of 1940, as amended (the "Investment Company Act"),
which change or prospective change becomes effective or would become
effective, as the case may be, on or after the date of the issuance of the
Capital Securities.
EXCHANGE OF CAPITAL SECURITIES FOR JUNIOR SUBORDINATED DEBENTURES
The holders of all of the outstanding Common Securities have the right at
any time to terminate the Issuer and, after satisfaction of liabilities to
creditors of the Issuer as required by applicable law, cause the Junior
Subordinated Debentures to be distributed to the holders of the Capital
Securities and Common Securities in exchange therefor upon liquidation of the
Issuer. See "Certain Terms of Capital Securities--Liquidation of Issuer and
Distribution of Junior Subordinated Debentures to Holders".
Under current United States federal income tax law and interpretations, a
distribution of the Junior Subordinated Debentures upon liquidation of the
Issuer would not be a taxable event to holders of the Capital Securities.
However, if any event described in clause (a) or (b) of the definition of "Tax
Event" above were to occur which would cause the Issuer to be subject to
United States federal income tax with respect to income received or accrued on
the Junior Subordinated Debentures, as the case would be if, for example, the
Issuer were treated as an association taxable as a corporation, a distribution
of the Junior Subordinated Debentures by the Issuer could be a taxable event
to the Issuer and the holders of the Capital Securities. See "U.S. Federal
Income Tax Consequences--Distribution of the Junior Subordinated Debentures to
Holders of Capital Securities Upon Liquidation of the Issuer".
SHORTENING OF STATED MATURITY OF JUNIOR SUBORDINATED DEBENTURES
The Corporation will have the right at any time to shorten the maturity of
the Junior Subordinated Debentures to a date not earlier than , 2013 and
thereby cause the Capital Securities to be redeemed on such earlier date.
MARKET PRICES
There can be no assurance as to the market prices for Capital Securities or
Junior Subordinated Debentures that may be distributed in exchange for Capital
Securities upon liquidation of the Issuer. Accordingly, the Capital Securities
that an investor may purchase, whether pursuant to the offer made hereby or in
the secondary market, or the Junior Subordinated Debentures that a holder of
Capital
S-7
<PAGE>
Securities may receive on liquidation of the Issuer, may trade at a discount
to the price that the investor paid to purchase the Capital Securities offered
hereby. As a result of the existence of the Corporation's right to defer
interest payments, the market price of the Capital Securities (which represent
preferred beneficial interests in the Issuer) may be more volatile than the
market prices of other securities on which original issue discount accrues
that are not subject to such deferrals. In addition, because the Corporation
has the right to shorten the Stated Maturity of the Junior Subordinated
Debentures, there can be no assurance that the Corporation will not exercise
its option to change the maturity of the Junior Subordinated Debentures as
permitted by the terms thereof and of the Indenture. If the Corporation does
exercise such option, there can be no assurance that the shortening of the
maturity of the Junior Subordinated Debentures will not have an effect on the
market price of the Capital Securities. See "Certain Terms of the Junior
Subordinated Debentures" and "Description of Junior Subordinated Debentures--
Corresponding Junior Subordinated Debentures" in the accompanying Prospectus.
RIGHTS UNDER THE GUARANTEE; DIRECT ACTION
The Guarantee guarantees to the holders of the Capital Securities the
following payments, to the extent not paid by the Issuer: (i) any accumulated
and unpaid Distributions required to be paid on the Capital Securities, to the
extent that the Issuer has funds on hand available therefor at such time, (ii)
the redemption price with respect to any Trust Securities called for
redemption, to the extent that the Issuer has funds on hand available therefor
at such time, and (iii) upon a voluntary or involuntary dissolution, winding-
up or liquidation of the Issuer (unless the Junior Subordinated Debentures are
distributed to holders of the Trust Securities), the lesser of (a) the
aggregate of the Liquidation Amount and all accumulated and unpaid
Distributions to the date of payment to the extent that the Issuer has funds
on hand available therefor at such time and (b) the amount of assets of the
Issuer remaining available for distribution to holders of the Capital
Securities. The Guarantee will be qualified as an indenture under the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"). Bankers Trust
Company will act as the indenture trustee under the Guarantee (the "Guarantee
Trustee") for the purposes of compliance with the Trust Indenture Act and will
hold the Guarantee for the benefit of the holders of the Capital Securities.
Bankers Trust Company will also act as Debenture Trustee for the Junior
Subordinated Debentures and as Property Trustee under the Trust Agreement and
Bankers Trust (Delaware) will act as Delaware Trustee under the Trust
Agreement.
The holders of not less than a majority in aggregate liquidation amount of
the outstanding 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 power conferred upon the Guarantee Trustee under the Guarantee. Any
holder of the Capital Securities may institute a legal proceeding directly
against the Corporation to enforce its rights under the Guarantee without
first instituting a legal proceeding against the Issuer, the Guarantee Trustee
or any other person or entity. If the Corporation were to default on its
obligation to pay amounts payable under the Junior Subordinated Debentures,
the Issuer 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. Instead, in the event a Debenture Event
of Default shall have occurred and be continuing and such event is
attributable to the failure of the Corporation to pay interest on or principal
of the Junior Subordinated Debentures on the payment date on which such
payment is due and payable, then a holder of Capital Securities may institute
a legal proceeding directly against the Corporation for enforcement of payment
to such holder of the principal of or interest on such Junior Subordinated
Debentures having a principal amount equal to the aggregate Liquidation Amount
of the Capital Securities of such holder (a "Direct Action"). In connection
with such Direct Action, the Corporation will have a right of set-off under
the Indenture to the extent of any payment made by the Corporation to such
holder of Capital Securities in the Direct Action. Except as described herein,
holders of Capital Securities will not be able to exercise directly any other
remedy available to the
S-8
<PAGE>
holders of the Junior Subordinated Debentures or assert directly any other
rights in respect of the Junior Subordinated Debentures. See "Description of
Junior Subordinated Debentures--Enforcement of Certain Rights by Holders of
Capital Securities" and "--Debenture Events of Default" and "Description of
Guarantees" in the accompanying Prospectus. The Trust Agreement provides that
each holder of Capital Securities by acceptance thereof agrees to the
provisions of the Guarantee and the Indenture.
LIMITED VOTING RIGHTS
Holders of Capital Securities generally will have limited voting rights
relating generally to the modification of the Capital Securities and the
Guarantee and the exercise of the Issuer's rights as holder of Junior
Subordinated Debentures. Holders of Capital Securities will not be entitled to
vote to appoint, remove or replace the Property Trustee or the Delaware
Trustee except upon the occurrence of certain events described in the
accompanying Prospectus. The Property Trustee and the holders of all of the
Common Securities may, subject to certain conditions, amend the Trust
Agreement without the consent of holders of Capital Securities to ensure that
(i) the Issuer will be classified for United States federal income tax
purposes as a grantor trust or as other than as an association taxable as a
corporation, (ii) the Junior Subordinated Debentures will be treated as
indebtedness of the Corporation or (iii) the Issuer will not be required to
register as an "investment company" under the Investment Company Act. See
"Description of Capital Securities--Voting Rights; Amendment of Each Trust
Agreement" and "--Removal of Issuer Trustees; Appointment of Successors" in
the accompanying Prospectus.
TRADING CHARACTERISTICS OF CAPITAL SECURITIES
The Capital Securities may trade at prices that do not fully reflect the
value of accrued but unpaid interest with respect to the underlying Junior
Subordinated Debentures. A holder of Capital Securities that disposes of its
Capital Securities between record dates for payments of Distributions (and
consequently does not receive a Distribution from the Issuer for the period
prior to such disposition) will nevertheless be required to include accrued
but unpaid interest on the Junior Subordinated Debentures through the date of
disposition in income as ordinary income for U.S. federal income tax purposes.
Such holder will recognize a capital loss to the extent the selling price
(which may not fully reflect the value of accrued but unpaid interest) is less
than its adjusted tax basis. Subject to certain limited exceptions, capital
losses cannot be applied to offset ordinary income for United States federal
income tax purposes. See "U.S. Federal Income Tax Consequences--Sale or
Redemption of Capital Securities".
AMERICAN EXPRESS COMPANY CAPITAL TRUST I
American Express Company Capital Trust I is a statutory business trust
created under Delaware law pursuant to (i) the Trust Agreement executed by the
Corporation, as Depositor and Bankers Trust (Delaware), as Delaware Trustee
and (ii) the filing of a certificate of trust with the Delaware Secretary of
State on May 29, 1998. The Issuer's business and affairs are conducted by its
trustees: initially Bankers Trust Company, as Property Trustee and Bankers
Trust (Delaware), as Delaware Trustee. In addition, two individuals who are
employees or officers of or affiliated with the holder of a majority of the
Common Securities will act as administrators with respect to the Issuer (the
"Administrators"). The Administrators will be selected by the holders of the
Common Securities. See "Description of Capital Securities--Miscellaneous" in
the accompanying Prospectus. The Issuer exists for the exclusive purposes of
(i) issuing and selling the Trust Securities, (ii) using the proceeds from the
sale of Trust Securities to acquire Junior Subordinated Debentures issued by
the Corporation and (iii) engaging in only those other activities necessary or
incidental thereto (such as registering the transfer of the Capital
Securities). Accordingly, the Junior Subordinated Debentures will be the sole
assets of the Issuer, and payments under the Junior Subordinated Debentures
will be the sole revenue of the Issuer.
S-9
<PAGE>
All of the Common Securities will be initially owned by the Corporation. The
Common Securities will rank pari passu, and payments will be made thereon pro
rata, with the Capital Securities, except that upon the occurrence and
continuance of an event of default under the Trust Agreement resulting from an
event of default under the Indenture, the rights of the Corporation, as holder
of the Common Securities, to payment in respect of Distributions and payments
upon liquidation, redemption or otherwise will be subordinated to the rights
of the holders of the Capital Securities. See "Description of Capital
Securities--Subordination of Common Securities" in the accompanying
Prospectus. The Corporation will acquire Common Securities in an aggregate
liquidation amount equal to 3% of the total capital of the Issuer. The Issuer
has a term of 55 years, but may terminate earlier as provided in the Trust
Agreement. The principal executive office of the Issuer is at World Financial
Center, 200 Vesey Street, New York, New York 10285, and its telephone number
is (212) 640-2000. See "The Issuers" in the accompanying Prospectus.
It is anticipated that the Issuer will not be subject to the reporting
requirements under the Securities Exchange Act of 1934, as amended (the
"Exchange Act").
THE CORPORATION
Through its subsidiaries, the Corporation is primarily engaged in the
business of providing travel related services, financial advisory services and
international banking services throughout the world.
Travel related services are offered principally through American Express
Travel Related Services Company, Inc. and its subsidiaries ("TRS") and include
a variety of products and services, including the American Express(R) Card,
the Optima Card(R) and other consumer and corporate lending products (the
"Cards"), the American Express(R) Travelers Cheque (the "Travelers Cheque")
and other stored value products, business expense management products and
services, tax preparation and bookkeeping services, corporate and consumer
travel products and services, magazine publishing, and management and merchant
transaction processing, point of sale and back office products and services.
At December 31, 1997, there were 42.7 million Cards in force worldwide, and
worldwide Card billed business for the year ended December 31, 1997 was $209.2
billion. U.S. consumer lending operations are conducted by American Express
Centurion Bank, a wholly-owned subsidiary of TRS whose deposits are insured by
the Federal Deposit Insurance Corporation. Travelers Cheque sales for the year
ended December 31, 1997 were $25 billion.
American Express Financial Corporation ("AEFC") and its subsidiaries are
engaged in providing a variety of financial products and services to help
individuals, businesses and institutions establish and achieve their financial
goals. AEFC's products and services include financial planning and advice,
insurance and annuities, a variety of investment products, including
investment certificates, mutual funds and limited partnerships, investment
advisory services, trust and employee plan administration services, personal
auto and homeowner's insurance and retail securities brokerage services. At
December 31, 1997, American Express Financial Advisors Inc. ("AEFA"), AEFC's
principal marketing subsidiary, maintained a nationwide financial planning
field force of 8,776 persons. At December 31, 1997, AEFA's assets owned and/or
managed totaled approximately $173.4 billion.
American Express Bank Ltd., together with its subsidiaries ("AEBL") offers
products that meet the financial services needs of four client groups:
corporations, financial institutions, affluent individuals and retail
customers. AEBL's five primary business lines are corporate banking and
finance, correspondent banking, private banking, personal financial services
and global trading. AEBL does not do business in the United States except as
an incident to its activities outside the United States.
The Corporation has its principal executive offices at World Financial
Center, 200 Vesey Street, New York, New York 10285, and its telephone number
is (212) 640-2000.
S-10
<PAGE>
CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the Corporation's ratios of earnings to fixed
charges for the years and periods indicated:
<TABLE>
<CAPTION>
THREE MONTHS
ENDED
MARCH 31 YEAR ENDED DECEMBER 31,
------------- ------------------------
1998 1997 1997 1996 1995 1994 1993
------ ------ ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges...... 2.09 2.26 2.22 2.17 1.86 1.90 2.20
</TABLE>
In computing the ratio of earnings to fixed charges, "earnings" consist of
pretax income from continuing operations plus interest expense and other
adjustments. For purposes of computing "earnings", other adjustments included
adding the amortization of capitalized interest, the net loss of affiliates
accounted for under the equity method whose debt is not guaranteed by the
Corporation, the minority interest in the earnings of majority-owned
subsidiaries with fixed charges, and the interest component of rental expense
and subtracting undistributed net income of affiliates accounted for under the
equity method.
"Fixed charges" consist of interest expense and other adjustments, including
capitalized interest costs and the interest component of rental expense.
Interest expense includes interest expense related primarily to the
international banking operations of the Corporation and TRS's Cardmember
lending activities, which is netted against interest and dividends and
Cardmember lending net finance charge revenue, respectively, in the
Corporation's Consolidated Statements of Income.
On May 31, 1994, the Corporation completed the spin-off of Lehman Brothers
Holdings, Inc. ("Lehman Brothers") through a dividend to common shareholders
of the Corporation. Accordingly, Lehman Brothers' results are reported as a
discontinued operation and are excluded from the above computation for all
periods presented. In March 1993, the Corporation reduced its ownership in
First Data Corporation ("FDC") to approximately 22 percent through a public
offering. As a result, beginning in 1993, FDC was reported as an equity
investment in the above computation. In the fourth quarter of 1995, the
Corporation's ownership was further reduced to approximately 10 percent as a
result of shares issued by FDC in connection with a merger transaction.
Accordingly, as of December 31, 1995, the Corporation's investment in FDC is
accounted for as Investments--Available for sale.
S-11
<PAGE>
USE OF PROCEEDS
All of the proceeds from the sale of Capital Securities will be invested by
the Issuer in Junior Subordinated Debentures. The Corporation intends that the
proceeds from the sale of such Junior Subordinated Debentures will be used for
general corporate purposes.
CAPITALIZATION
The following table sets forth the consolidated capitalization of the
Corporation and its subsidiaries (in millions) as of December 31, 1997 and as
adjusted to give effect to the consummation of the offering of the Capital
Securities. The following data should be read in conjunction with the
consolidated financial statements and notes thereto included in the documents
incorporated herein by reference. See "Incorporation of Certain Documents by
Reference" in the accompanying Prospectus.
<TABLE>
<CAPTION>
OUTSTANDING
DECEMBER 31, AS
1997 ADJUSTED
------------ --------
<S> <C> <C>
LONG-TERM INDEBTEDNESS
Notes due June 15, 2000................................ $ 300 $
Notes due November 15, 2001............................ 299
Notes due August 15, 2001.............................. 299
Floating Rate Notes due December 18, 2001.............. 300
Floating Rate Notes due May 1, 2002.................... 399
Notes due August 12, 2002.............................. 400
Notes due June 23, 2004................................ 499
Other Fixed Senior Notes due 1998-2022................. 1,509
Other Floating Senior Notes due 1998-2002.............. 3,106
Other Floating Rate Notes due 1999-2004................ 506
Other Fixed Rate Notes due 1998-2006................... 256
------- -------
Total................................................ $ 7,873 $
Guaranteed Preferred Beneficial Interests in the
Corporation's Junior Subordinated Deferrable Interest
Debentures(1)...........................................
STOCKHOLDERS' EQUITY
Common shares; par value $.60 a share (authorized 1.2
billion shares; 466.4 million shares issued and
outstanding).......................................... 280
Capital surplus........................................ 4,624
Net unrealized securities gains........................ 579
Foreign currency translation adjustments............... (97)
Retained earnings...................................... 4,188
------- -------
Total stockholders' equity........................... 9,574
------- -------
Total Capitalization..................................... $17,447 $
======= =======
</TABLE>
- --------
(1) As described herein, the sole assets of the Issuer will be $ of %
Junior Subordinated Debentures, issued by the Corporation to the Issuer.
The Junior Subordinated Debentures will mature on , 2028 which
date may be shortened to a date not earlier than , 2013. The
Corporation owns all of the Common Securities of the Issuer, which accrue
distributions at the rate of % per annum.
Except as set forth herein, there has been no material change in the
consolidated capitalization of the Corporation and its subsidiaries since
December 31, 1997 to the date of this Prospectus Supplement.
S-12
<PAGE>
SELECTED FINANCIAL DATA
The following table presents summary consolidated financial data derived
from the consolidated financial statements of the Corporation. This summary is
qualified in its entirety by the financial statements and the notes thereto
included in the documents incorporated herein by reference. See "Incorporation
of Certain Documents by Reference" in the accompanying Prospectus.
<TABLE>
<CAPTION>
THREE MONTHS ENDED YEAR ENDED DECEMBER 31,
---------------------- ------------------------------------------------------
1998 1997 1997 1996 1995 1994 1993
--------- --------- -------- -------- -------- ------- -------
(MILLIONS, EXCEPT PER SHARE AMOUNTS AND WHERE ITALICIZED)
<S> <C> <C> <C> <C> <C> <C> <C>
OPERATING RESULTS
Net revenues............ $ 4,521 $ 4,164 $ 17,760 $ 16,380 $ 15,921 $14,342 $13,301
Percent increase
(decrease)............. 9% 7% 8% 3% 11% 8% (7%)
Expenses................ 3,907 3,524 15,010 13,716 13,738 12,451 10,975
Income from continuing
operations before
accounting changes
As reported............. 460 454 1,991 1,901 1,564 1,380 1,605
Adjusted(1)............. 460 454 1,991 1,739 1,564 1,380 1,172
Net income.............. 460 454 1,991 1,901 1,564 1,413 1,478
Return on average
shareholders'
equity(2).............. 23.1% 23.0% 23.5% 22.8% 22.0% 20.3% 20.9%
<CAPTION>
AS OF MARCH 31, AS OF AND FOR YEAR ENDED DECEMBER 31,
---------------------- ------------------------------------------------------
1998 1997 1997 1996 1995 1994 1993
--------- --------- -------- -------- -------- ------- -------
(MILLIONS, EXCEPT PER SHARE AMOUNTS AND WHERE ITALICIZED)
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCE SHEET
Cash and cash
equivalents............. $ 4,342 $ 3,170 $ 4,179 $ 2,677 $ 3,200 $ 3,433 $ 3,312
Accounts receivable and
accrued interest, net... 20,094 19,164 21,774 20,491 19,914 17,147 16,142
Investments.............. 39,876 38,140 39,648 38,339 42,561 40,108 39,308
Loans, net............... 19,416 19,182 20,109 18,518 16,091 14,722 14,796
Total assets............. 120,303 108,105 120,003 108,512 107,405 97,006 94,132
Customers' deposits...... 9,724 10,603 9,444 9,555 9,889 10,013 11,131
Travelers Cheques
outstanding............. 5,585 5,766 5,634 5,838 5,697 5,271 4,800
Insurance and annuity
reserves................ 26,039 25,817 26,165 25,674 25,157 24,849 23,406
Short-term debt.......... 18,151 17,324 20,570 18,402 17,654 14,810 12,489
Long-term debt........... 8,140 6,331 7,873 6,552 7,570 7,162 8,561
Shareholders' equity..... 9,425 8,382 9,574 8,528 8,220 6,433 8,734
</TABLE>
- --------
(1) Adjusted to exclude: in 1996--a $300 million gain on the exchange of the
Corporation's DECS and a $138 million restructuring charge; 1993--a $433
million gain on the sale of FDC shares.
(2) Return on average shareholders' equity is based on adjusted income from
continuing operations before accounting changes and excludes the effect of
SFAS No. 115 beginning in 1994.
S-13
<PAGE>
ACCOUNTING TREATMENT
For financial reporting purposes, the Issuer will be treated as a subsidiary
of the Corporation and, accordingly, the accounts of the Issuer will be
included in the consolidated financial statements of the Corporation. The
Capital Securities will be presented as a separate line item in the
consolidated balance sheets of the Corporation, entitled "Guaranteed Preferred
Beneficial Interests in the Company's Junior Subordinated Deferrable Interest
Debentures" and appropriate disclosures about the Capital Securities, the
Guarantee and the Junior Subordinated Debentures will be included in the notes
to the consolidated financial statements. For financial reporting purposes,
the Corporation will record Distributions payable on the Capital Securities as
an expense in the consolidated statements of income.
The Corporation has determined that future financial reports of the
Corporation will: (i) include in a footnote to the financial statements
disclosure that the sole assets of the Issuer are the Junior Subordinated
Debentures; and (ii) if Staff Accounting Bulletin 53 treatment is sought,
include, in an audited footnote to the financial statements, disclosure that
(a) the trust is wholly owned, (b) the sole assets of the Issuer are the
Junior Subordinated Debentures and (c) the obligations of the Corporation
under the Junior Subordinated Debentures, the Indenture, Trust Agreement,
Guarantee and Expense Agreement, in the aggregate, constitute a full and
unconditional guarantee by the Corporation of the Issuer's obligations under
the Capital Securities.
CERTAIN TERMS OF CAPITAL SECURITIES
GENERAL
The following summary of certain terms and provisions of the Capital
Securities supplements the description of the terms and provisions of the
Capital Securities set forth in the accompanying Prospectus under the heading
"Description of Capital Securities", to which description reference is hereby
made. This summary of certain terms and provisions of the Capital Securities,
which summarizes the material provisions thereof, does not purport to be
complete and is subject to, and qualified in its entirety by reference to, the
Trust Agreement to which reference is hereby made. The form of Trust Agreement
has been filed as an exhibit to the Registration Statement of which this
Prospectus Supplement and accompanying Prospectus form a part.
DISTRIBUTIONS
The Capital Securities represent beneficial interests in the Issuer, and
Distributions on the Capital Securities will be payable at the annual rate of
% of the stated Liquidation Amount of $1,000, payable semi-annually in
arrears on and of each year (each a "Distribution Date"), to
the holders of the Capital Securities at the close of business on the
fifteenth day (whether or not a Business Day (as defined below)) next
preceding the relevant Distribution Date. Distributions will accumulate from
the date of original issuance. The first Distribution payment date for the
Capital Securities will be , 1998. The amount of Distributions payable
for any period will be computed on the basis of a 360-day year of twelve 30-
day months. In the event that any date on which Distributions are payable on
the Capital Securities is not a Business Day, then payment of the
Distributions payable on such date will be made on the next succeeding day
that is a Business Day (and without any additional Distributions or other
payment in respect of any such delay) with the same force and effect as if
made on the date such payment was originally payable. The Paying Agent for the
Capital Securities shall be Bankers Trust Company. See "Description of Capital
Securities--Distributions" in the accompanying Prospectus.
So long as no event of default under the Indenture has occurred and is
continuing, the Corporation has the right under the Indenture to defer payment
of interest on the Junior Subordinated Debentures
S-14
<PAGE>
at any time or from time to time for a period not exceeding 10 consecutive
semi-annual periods with respect to each Extension Period, provided that no
Extension Period may extend beyond the Stated Maturity of the Junior
Subordinated Debentures. As a consequence of any such deferral of interest
payments by the Corporation, semi-annual Distributions on the Capital
Securities will also be deferred by the Issuer during any such Extension
Period. Distributions to which holders of the Capital Securities are entitled
will accumulate additional Distributions thereon at the rate per annum of [ ]%
thereof, compounded semi-annually from the relevant payment date for such
Distributions. The term "Distributions" as used herein shall include any such
additional Distributions. During any such Extension Period, the Corporation
may not (i) declare or pay any dividends or distributions on, or redeem,
purchase, acquire, or make a liquidation payment with respect to, any of the
Corporation's capital stock or (ii) make any payment of principal of or
interest or premium, if any, on or repay, repurchase or redeem any debt
securities of the Corporation that rank pari passu in all respects with or
junior in interest to the Junior Subordinated Debentures (other than (a)
repurchases, redemptions or other acquisitions of shares of capital stock of
the Corporation in connection with any employment contract, benefit plan or
other similar arrangement with or for the benefit of one or more employees,
officers, directors or consultants, in connection with a dividend reinvestment
or stockholder stock purchase plan or in connection with the issuance of
capital stock of the Corporation (or securities convertible into or
exercisable for such capital stock) as consideration in an acquisition
transaction entered into prior to the applicable Extension Period, (b) as a
result of any exchange or conversion of any class or series of the
Corporation's capital stock (or any capital stock of a subsidiary of the
Corporation) for any class or series of the Corporation's capital stock or of
any class or series of the Corporation's indebtedness for any class or series
of the Corporation's capital stock, (c) the purchase of fractional interests
in shares of the Corporation's capital stock pursuant to the conversion or
exchange provisions of such capital stock or the security being converted or
exchanged, (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 ranks pari passu with or junior to such stock).
Prior to the termination of any such Extension Period, the Corporation may
further defer the payment of interest on the Junior Subordinated Debentures,
provided that no Extension Period may exceed 10 consecutive semi-annual
periods or extend beyond the Stated Maturity of the Junior Subordinated
Debentures. Upon the termination of any such Extension Period and the payment
of all interest then accrued and unpaid (together with interest thereon at the
rate of % per annum, compounded semi-annually, to the extent permitted by
applicable law), the Corporation may elect to begin a new Extension Period.
There is no limitation on the number of times that the Corporation may elect
to begin an Extension Period. See "Certain Terms of Junior Subordinated
Debentures--Option to Defer Interest Payments" and "U.S. Federal Income Tax
Consequences--Interest Income and Original Issue Discount".
The Corporation has no current intention of exercising its right to defer
payments of interest by extending the interest payment period on the Junior
Subordinated Debentures.
REDEMPTION
Upon the repayment or redemption, in whole or in part, of the Junior
Subordinated Debentures, whether at Stated Maturity or upon earlier redemption
as provided in the Indenture, the proceeds from such repayment or redemption
shall be applied by the Property Trustee to redeem a Like Amount (as defined
below) of Trust Securities, upon not less than 30 nor more than 60 days notice
prior to the date fixed for repayment or redemption, at a redemption price
(the "Redemption Price"), equal to the aggregate Liquidation Amount of such
Trust Securities plus accumulated and unpaid Distributions thereon to the date
of redemption (the "Redemption Date") and the related amount of the premium,
if
S-15
<PAGE>
any, paid by the Corporation upon the concurrent redemption of such Junior
Subordinated Debentures. See "Description of Capital Securities--Redemption or
Exchange" in the accompanying Prospectus. For a description of the Stated
Maturity and redemption provisions of the Junior Subordinated Debentures, see
"Certain Terms of Junior Subordinated Debentures--General" and "--Redemption".
The Corporation has the right to redeem the Junior Subordinated Debentures
(i) on or after , 2008, in whole at any time or in part from time to
time, or (ii) in whole (but not in part) at any time within 90 days following
the occurrence and during the continuation of a Tax Event or Investment
Company Event. A redemption of the Junior Subordinated Debentures would cause
a mandatory redemption of a Like Amount of the Capital Securities and Common
Securities.
The Redemption Price, in the case of a redemption under (i) above, shall
equal the following prices, expressed in percentages of the Liquidation Amount
(as defined below), together with accumulated Distributions to but excluding
the date fixed for redemption, if redeemed during the 12-month period
beginning of the year indicated below:
<TABLE>
<CAPTION>
REDEMPTION
YEAR PRICE
---- ----------
<S> <C>
2008...........................................................
2009...........................................................
2010...........................................................
2011...........................................................
2012...........................................................
2013...........................................................
2014...........................................................
2015...........................................................
2016...........................................................
2017...........................................................
</TABLE>
and at 100% on or after , 2018.
The Redemption Price, in the case of a redemption prior to , 2008
following a Tax Event or Investment Company Event as described under (ii)
above, will equal for each Capital Security the Make-Whole Amount for a
corresponding $1,000 principal amount of Junior Subordinated Debentures
together with accumulated Distributions to but excluding the date fixed for
redemption. The "Make-Whole Amount" will be equal to the greater of (i) 100%
of the principal amount of such Junior Subordinated Debentures or (ii) as
determined by a Quotation Agent (as defined below), the sum of the present
values of the principal amount and premium payable as part of the Redemption
Price with respect to an optional redemption of such Junior Subordinated
Debentures on , 2008 together with the present values of scheduled
payments of interest from the Redemption Date to , 2008 (the "Remaining
Life"), in each case discounted to the Redemption Date on a semi-annual basis
(assuming a 360-day year consisting of 30-day months) at the Adjusted Treasury
Rate.
"Adjusted Treasury Rate" means, with respect to any Redemption Date, the
Treasury Rate plus (i) % if such Redemption Date occurs on or before
or (ii) % if such Redemption Date occurs after .
"Treasury Rate" means (i) the yield, under the heading which represents the
average for the week immediately prior to the calculation date, appearing in
the most recently published statistical release designated "H.15(519)" or any
successor publication which is published weekly by the Federal Reserve and
which establishes yields on actively traded United States Treasury securities
adjusted to constant maturity under the caption "Treasury Constant
Maturities", for the maturity corresponding to
S-16
<PAGE>
the Remaining Life (if no maturity is within three months before or after the
Remaining Life, yields for the two published maturities most closely
corresponding to the Remaining Life shall be determined and the Treasury Rate
shall be interpolated or extrapolated from such yields on a straight-line
basis, rounding to the nearest month) or (ii) if such release (or any
successor release) is not published during the week preceding the calculation
date or does not contain such yields, the rate per annum equal to the semi-
annual equivalent yield to maturity of the Comparable Treasury Issue,
calculated using a price for the Comparable Treasury Issue (expressed as a
percentage of its principal amount) equal to the Comparable Treasury Price for
such Redemption Date. The Treasury Rate shall be calculated on the third
Business Day preceding the Redemption Date.
"Business Day" means a day other than (i) a Saturday or Sunday, (ii) a day
on which banking institutions in The City of New York are authorized or
required by law or executive order to remain closed or (iii) a day on which
the Property Trustee's Corporate Trust Office or the Corporate Trust Office of
the Debenture Trustee is closed for business.
"Comparable Treasury Issue" means with respect to any Redemption Date the
United States Treasury security selected by the Quotation Agent as having a
maturity comparable to the Remaining Life that would be utilized, at the time
of selection and in accordance with customary financial practice, in pricing
new issues of corporate debt securities of comparable maturity to the
Remaining Life. If no United States Treasury security has a maturity which is
within a period from three months before to three months after , 2008 the
two most closely corresponding United States Treasury securities shall be used
as the Comparable Treasury Issue, and the Treasury Rate shall be interpolated
or extrapolated on a straight-line basis, rounding to the nearest month using
such securities.
"Quotation Agent" means and its successors; provided, however,
that if the foregoing shall cease to be a primary U.S. Government securities
dealer in New York City (a "Primary Treasury Dealer"), the Corporation shall
substitute therefor another Primary Treasury Dealer.
"Reference Treasury Dealer" means (i) the Quotation Agent and (ii) any other
Primary Treasury Dealer selected by the Debenture Trustee after consultation
with the Corporation.
"Comparable Treasury Price" means (i) the average of five Reference Treasury
Dealer Quotations for such Redemption Date, after excluding the highest and
lowest such Reference Treasury Dealer Quotations, or (ii) if the Debenture
Trustee obtains fewer than five such Reference Treasury Dealer Quotations, the
average of all such Quotations.
"Reference Treasury Dealer Quotations" means, with respect to each Reference
Treasury Dealer and any Redemption Date, the average, as determined by the
Debenture Trustee, of the bid and asked prices for the Comparable Treasury
Issue (expressed in each case as a percentage of its principal amount) quoted
in writing to the Debenture Trustee by such Reference Treasury Dealer at 5:00
p.m., New York City time, on the third Business Day preceding such Redemption
Date.
"Like Amount" means (i) with respect to a redemption of Trust Securities,
Trust Securities having a Liquidation Amount (as defined below) equal to the
principal amount of Junior Subordinated Debentures to be contemporaneously
redeemed in accordance with the Indenture, allocated to the Common Securities
and to the Capital Securities based upon the relative Liquidation Amounts of
such classes and (ii) with respect to a distribution of Junior Subordinated
Debentures to holders of Trust Securities in connection with a dissolution or
liquidation of the Issuer, Junior Subordinated Debentures having a principal
amount equal to the Liquidation Amount of the Trust Securities of the holder
to whom such Junior Subordinated Debentures are distributed.
"Liquidation Amount" means the stated amount of $1,000 per Trust Security.
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<PAGE>
A "Tax Event" means the receipt by the Issuer of an opinion of 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 political
subdivision or taxing authority thereof or therein, or (b) any judicial
decision or any official administrative pronouncement (including any private
letter ruling, technical advice memorandum or field service advice) or
regulatory procedure (an "Administrative Action"), regardless of whether such
judicial decision or Administrative Action is issued to or in connection with
a proceeding involving the Corporation or the Issuer and whether or not
subject to review or appeal, which amendment, clarification, change,
Administrative Action or decision is enacted, promulgated or announced, in
each case, on or after the date of this Prospectus Supplement, there is more
than an insubstantial risk that (i) the Issuer is, or will be within 90 days
of the date of such opinion, subject to United States federal income tax with
respect to income received or accrued on the Junior Subordinated Debentures,
(ii) interest payable by the Corporation on the Junior Subordinated Debentures
is not, or within 90 days of such opinion, will not be, deductible by the
Corporation, in whole or in part, for United States federal income tax
purposes, or (iii) the Issuer is, or will be within 90 days of the date of the
opinion, subject to more than a de minimis amount of other taxes, duties or
other governmental charges.
"Investment Company Event" means the receipt by the Issuer 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 or a written change (including any
announced prospective change) in interpretation or application of law or
regulation by any legislative body, court, governmental agency or regulatory
authority, there is more than an insubstantial risk that the Issuer is or will
be considered an "investment company" that is required to be registered under
the Investment Company Act of 1940, as amended (the "Investment Company Act"),
which change or prospective change becomes effective or would become
effective, as the case may be, on or after the date of the issuance of the
Capital Securities.
Payment of Additional Sums. If a Tax Event described in clause (i) or (iii)
of the definition of Tax Event above has occurred and is continuing and the
Issuer is the holder of all of the Junior Subordinated Debentures, the
Corporation will pay Additional Sums (as defined below), if any, on the Junior
Subordinated Debentures.
"Additional Sums" means the additional amounts as may be necessary in order
that the amount of Distributions then due and payable by the Issuer on the
outstanding Capital Securities and Common Securities will not be reduced as a
result of certain additional taxes, duties and other governmental charges to
which the Issuer has become subject as a result of a Tax Event.
LIQUIDATION OF ISSUER AND DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES TO
HOLDERS
The amount payable on the Capital Securities in the event of any liquidation
of the Issuer is $1,000 per Capital Security plus accumulated and unpaid
Distributions, subject to certain exceptions, which may be in the form of a
distribution of such amount in Junior Subordinated Debentures.
The holders of all of the outstanding Common Securities will have the right
at any time to liquidate the Issuer and cause the Junior Subordinated
Debentures to be distributed to the holders of the Capital Securities and
Common Securities in exchange therefor upon liquidation of the Issuer.
Under current United States federal income tax law, a distribution of Junior
Subordinated Debentures in exchange for Capital Securities would not be a
taxable event to holders of the Capital Securities. However, should any event
described in clause (a) or (b) of the definition of "Tax Event" above occur,
the distribution of the Junior Subordinated Debentures could be a taxable
event to holders of the Capital Securities. See "U.S. Federal Income Tax
Consequences--Distribution of Junior Subordinated Debentures to Holders of
Capital Securities Upon Liquidation of the Issuer". If the Corporation elects
neither to redeem the Junior Subordinated Debentures prior to maturity nor to
liquidate the Issuer and distribute the Junior Subordinated Debentures to
holders of the Capital
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<PAGE>
Securities in exchange therefor, the Capital Securities will remain
outstanding until the Stated Maturity of the Junior Subordinated Debentures.
If the Corporation elects to liquidate the Issuer and thereby causes the
Junior Subordinated Debentures to be distributed to holders of the Capital
Securities in exchange therefor upon liquidation of the Issuer, the
Corporation shall continue to have the right to shorten the maturity of the
Junior Subordinated Debentures, subject to certain conditions as described
under "Certain Terms of Junior Subordinated Debentures--General".
REGISTRATION OF CAPITAL SECURITIES
The Capital Securities will be represented by global certificates registered
in the name of DTC or its nominee. Beneficial interests in the Capital
Securities will be shown on, and transfers thereof will be effected only
through, records maintained by Participants in DTC (as defined in the
accompanying Prospectus). Except as described below and in the accompanying
Prospectus, Capital Securities in certificated form will not be issued in
exchange for the global certificates. See "Book-Entry Issuance" in the
accompanying Prospectus.
A global security shall be exchangeable for Capital Securities registered in
the names of persons other than DTC or its nominee only if (i) DTC notifies
the Issuer that it is unwilling or unable to continue as a depository for such
global security and no successor depository shall have been appointed, or if
at any time DTC ceases to be a clearing agency registered under the Exchange
Act, at a time when DTC is required to be so registered to act as such
depository, (ii) the Issuer in its sole discretion determines that such global
security shall be so exchangeable or (iii) there shall have occurred and be
continuing an event of default under the Indenture with respect to the Junior
Subordinated Debentures. Any global security that is exchangeable pursuant to
the preceding sentence shall be exchangeable for definitive certificates
registered in such names as DTC shall direct. It is expected that such
instructions will be based upon directions received by DTC from its
Participants with respect to ownership of beneficial interests in such global
security. In the event that Capital Securities are issued in definitive form,
such Capital Securities will be in denominations of $1,000 and integral
multiples thereof and may be transferred or exchanged at the offices described
below.
Payments on Capital Securities represented by a global security will be made
to DTC, as depository for the Capital Securities. In the event Capital
Securities are issued in certificated form, the Liquidation Amount and
Distributions will be payable, the transfer of the Capital Securities will be
registrable, and Capital Securities will be exchangeable for Capital
Securities of other denominations of a like aggregate Liquidation Amount, at
the corporate office of the Property Trustee in New York, New York, or at the
offices of any paying agent or transfer agent chosen by the Property Trustee
and acceptable to the Administrators, provided that payment of any
Distribution may be made by check mailed to the address of the persons
entitled thereto or by wire transfer. In addition, if the Capital Securities
are issued in certificated form, the record dates for payment of Distributions
will be the 15th day of the month in which the relevant Distribution payment
is scheduled to be made. For a description of DTC and the terms of DTC
arrangements relating to payments, transfers, voting rights, redemptions, and
other notices and other matters, see "Book-Entry Issuance" in the accompanying
Prospectus.
CERTAIN TERMS OF JUNIOR SUBORDINATED DEBENTURES
GENERAL
The following summary of certain terms and provisions of the Junior
Subordinated Debentures supplements the description of the terms and
provisions of the Corresponding Junior Subordinated Debentures set forth in
the accompanying Prospectus under the headings "Description of Junior
Subordinated Debentures", to which description reference is hereby made. The
summary of certain
S-19
<PAGE>
terms and provisions of the Junior Subordinated Debentures set forth below,
which describes the material provisions thereof, does not purport to be
complete and is subject to, and is qualified in its entirety by reference to,
the Indenture to which reference is hereby made. The form of Indenture has
been filed as an exhibit to the Registration Statement of which this
Prospectus Supplement and accompanying Prospectus form a part.
Concurrently with the issuance of the Capital Securities, the Issuer will
invest the proceeds thereof, together with the consideration paid by the
Corporation for the Common Securities, in the Junior Subordinated Debentures
issued by the Corporation. The Junior Subordinated Debentures will bear
interest at the annual rate of % of the principal amount thereof, payable
semi-annually in arrears on and of each year (each, an "Interest
Payment Date"), commencing , 1998, to the person in whose name each
Junior Subordinated Debenture is registered, subject to certain exceptions, at
the close of business on the Business Day next preceding such Interest Payment
Date. It is anticipated that, until the liquidation, if any, of the Issuer,
the Junior Subordinated Debentures will be held in the name of the Property
Trustee in trust for the benefit of the holders of the Trust Securities. The
amount of interest payable for any period will be computed on the basis of a
360-day year of twelve 30-day months. In the event that any date on which
interest is payable on the Junior Subordinated Debentures is not a Business
Day, then payment of the interest payable on such date will be made on the
next succeeding day that is a Business Day (and without any interest or other
payment in respect of any such delay), except that, if such Business Day is in
the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case with the same force and
effect as if made on the date such payment was originally payable. Accrued
interest that is not paid on the applicable Interest Payment Date will bear
additional interest on the amount thereof (to the extent permitted by law) at
the rate per annum of % thereof, compounded semi-annually from the relevant
Interest Payment Date. The term "interest" as used herein shall include semi-
annual interest payments, interest on semi-annual interest payments not paid
on the applicable Interest Payment Date and Additional Sums, as applicable.
The Junior Subordinated Debentures will be issued under the Indenture. The
Junior Subordinated Debentures will mature on , 2028 (such date, as it
may be shortened as hereinafter described, the "Stated Maturity"). Such date
may be shortened to a date not earlier than , 2013. In the event the
Corporation elects to shorten the Stated Maturity of the Junior Subordinated
Debentures, it shall give notice to the Debenture Trustee, and the Debenture
Trustee shall give notice of such shortening to the holders of the Junior
Subordinated Debentures no more than 30 and no less than 60 days prior to the
effectiveness thereof.
The Junior Subordinated Debentures will be unsecured and will rank junior
and be subordinate in right of payment to all Senior Debt of the Corporation.
See "Description of Junior Subordinated Debentures--Subordination" in the
accompanying Prospectus. Substantially all of the Corporation's existing
indebtedness constitutes Senior Debt. Because the Corporation is a holding
company, the right of the Corporation to participate in any distribution of
assets of any subsidiary, including TRS, AEFC and AEBL, upon such subsidiary's
liquidation or reorganization or otherwise (and thus the ability of holders of
the Capital Securities to benefit indirectly from such distribution), is
subject to the prior claims of creditors of that subsidiary, except to the
extent that the Corporation may itself be recognized as a creditor of that
subsidiary. Accordingly, the Junior Subordinated Debentures will be
effectively subordinated to all existing and future liabilities of the
Corporation's subsidiaries, and holders of Junior Subordinated Debentures
should look only to the assets of the Corporation for payments on the Junior
Subordinated Debentures. The Indenture does not limit the incurrence or
issuance of other secured or unsecured debt of the Corporation, including
Senior Debt, whether under the Indenture or any existing or other indenture
that the Corporation may enter into in the future or otherwise. See
"Description of Junior Subordinated Debentures--Subordination" in the
accompanying Prospectus.
S-20
<PAGE>
OPTION TO DEFER INTEREST PAYMENTS
So long as no event of default under the Indenture has occurred and is
continuing, the Corporation has the right under the Indenture at any time or
from time to time during the term of the Junior Subordinated Debentures to
defer payment of interest on the Junior Subordinated Debentures for a period
not exceeding 10 consecutive semi-annual periods with respect to each
Extension Period, provided that no Extension Period may extend beyond the
Stated Maturity of the Junior Subordinated Debentures. At the end of such
Extension Period, the Corporation must pay all interest then accrued and
unpaid on the Junior Subordinated Debentures (together with interest on such
unpaid interest at the annual rate of %, compounded semi-annually from the
relevant Interest Payment Date, to the extent permitted by applicable law).
During an Extension Period, interest will continue to accrue and holders of
Junior Subordinated Debentures (or holders of Capital Securities while they
are outstanding) will be required to accrue interest income for United States
federal income tax purposes. See "U.S. Federal Income Tax Consequences--
Interest Income and Original Issue Discount".
During any such Extension Period, the Corporation may not (i) declare or pay
any dividends or distributions on, or redeem, purchase, acquire, or make a
liquidation payment with respect to, any of the Corporation's capital stock or
(ii) make any payment of principal of or interest or premium, if any, on or
repay, repurchase or redeem any debt securities of the Corporation that rank
pari passu in all respects with or junior in interest to the Junior
Subordinated Debentures (other than (a) repurchases, redemptions or other
acquisitions of shares of capital stock of the Corporation in connection with
any employment contract, benefit plan or other similar arrangement with or for
the benefit of one or more employees, officers, directors or consultants, in
connection with a dividend reinvestment or stockholder stock purchase plan or
in connection with the issuance of capital stock of the Corporation (or
securities convertible into or exercisable for such capital stock) as
consideration in an acquisition transaction entered into prior to the
applicable Extension Period, (b) as a result of any exchange or conversion of
any class or series of the Corporation's capital stock (or any capital stock
of a subsidiary of the Corporation) for any class or series of the
Corporation's capital stock or of any class or series of the Corporation's
indebtedness for any class or series of the Corporation's capital stock, (c)
the purchase of fractional interests in shares of the Corporation's capital
stock pursuant to the conversion or exchange provisions of such capital stock
or the security being converted or exchanged, (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 ranks pari
passu with or junior to such stock). Prior to the termination of any such
Extension Period, the Corporation may further defer the payment of interest on
the Junior Subordinated Debentures, provided that no Extension Period may
exceed 10 consecutive semi-annual periods or extend beyond the Stated Maturity
of the Junior Subordinated Debentures. Upon the termination of any such
Extension Period and the payment of all interest then accrued and unpaid
(together with interest thereon at the rate of % per annum compounded semi-
annually, to the extent permitted by applicable law), the Corporation may
elect to begin a new Extension Period subject to the above requirements. No
interest shall be due and payable during an Extension Period, except at the
end thereof. The Corporation must give the Issuer Trustees notice of its
election to begin such Extension Period at least one Business Day prior to the
earlier of (i) the date interest on the Junior Subordinated Debentures would
have been payable except for the election to begin such Extension Period or
(ii) the date such interest is payable, but in any event not less than one
Business Day prior to such record date. The Debenture Trustee shall give
notice of the Corporation's election to begin a new Extension Period to the
holders of the Junior Subordinated Debentures. There is no limitation on the
number of times that the Corporation may elect to begin an Extension Period.
See "Description of Junior Subordinated Debentures--Option to Defer Interest
Payments" in the accompanying Prospectus.
S-21
<PAGE>
ADDITIONAL SUMS
The Corporation has covenanted in the Indenture that, if and for so long as
(i) the Issuer is the holder of all the Junior Subordinated Debentures and
(ii) the Issuer is required to pay certain additional taxes, duties or other
governmental charges as a result of a Tax Event, the Corporation will pay as
additional amounts on the Junior Subordinated Debentures such amounts as shall
be required so that the Distributions payable by the Issuer shall not be
reduced as a result of any such additional taxes, duties or other governmental
charges. See "Description of Capital Securities--Redemption".
Pursuant to the Agreement as to Expenses and Liabilities, the Corporation
will agree to pay all debts and other obligations (other than with respect to
the Capital Securities) and all costs and expenses of the Issuer (including
costs and expenses relating to the organization of the Issuer, the fees and
expenses of the Issuer Trustees and the costs and expenses relating to the
operation of the Issuer). The form of Agreement as to Expenses and Liabilities
is included as Exhibit D in the form of Trust Agreement, which has been filed
as an exhibit to the Registration Statement of which this Prospectus
Supplement and accompanying Prospectus form a part.
REDEMPTION
The Junior Subordinated Debentures are redeemable prior to maturity at the
option of the Corporation (i) on or after , 2008 in whole at any time or
in part from time to time, or (ii) in whole (but not in part) at any time
within 90 days following the occurrence and during the continuation of a Tax
Event or Investment Company Event in each case at the redemption price
described below. The proceeds of any such redemption will be used by the
Issuer to redeem the Capital Securities.
The redemption price for Junior Subordinated Debentures in the case of a
redemption under (i) above shall equal the following prices, expressed in
percentages of the principal amount, together with accrued interest to but
excluding the date fixed for redemption, if redeemed during the 12-month
period beginning of the years indicated below:
<TABLE>
<CAPTION>
REDEMPTION
YEAR PRICE
---- ----------
<S> <C>
2008...........................................................
2009...........................................................
2010...........................................................
2011...........................................................
2012...........................................................
2013...........................................................
2014...........................................................
2015...........................................................
2016...........................................................
2017...........................................................
</TABLE>
and at 100% on or after , 2018.
The redemption price for Junior Subordinated Debentures, in the case of a
redemption prior to , 2008 following a Tax Event or Investment Company
Event, as described under (ii) above, will equal the Make-Whole Amount (as
defined under "Certain Terms of Capital Securities--Redemption"), together
with accrued interest to but excluding the date fixed for redemption.
DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES
As described under "Certain Terms of Capital Securities--Liquidation of
Issuer and Distribution of Junior Subordinated Debentures to Holders", under
certain circumstances involving the termination of
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<PAGE>
the Issuer, Junior Subordinated Debentures may be distributed to the holders
of the Capital Securities in exchange therefor upon liquidation of the Issuer
after satisfaction of liabilities to creditors of the Issuer as provided by
applicable law. If distributed to holders of Capital Securities, the Junior
Subordinated Debentures will initially be issued in the form of one or more
global securities and DTC, or any successor depositary for the Capital
Securities, will act as depositary for the Junior Subordinated Debentures. It
is anticipated that DTC arrangements for the Junior Subordinated Debentures
would be substantially identical to those in effect for the Capital
Securities. There can be no assurance as to the market price of any Junior
Subordinated Debentures that may be distributed to the holders of Capital
Securities.
REGISTRATION OF JUNIOR SUBORDINATED DEBENTURES
The Junior Subordinated Debentures will be represented by global
certificates registered in the name of DTC or its nominee. Beneficial
interests in the Junior Subordinated Debentures will be shown on, and
transfers thereof will be effected only through, records maintained by
Participants in DTC. Except as described below and in the accompanying
Prospectus, Junior Subordinated Debentures in certificated form will not be
issued in exchange for the global certificates. See "Book-Entry Issuance" in
the accompanying Prospectus.
A global security shall be exchangeable for Junior Subordinated Debentures
registered in the names of persons other than DTC or its nominee only if (i)
DTC notifies the Corporation that it is unwilling or unable to continue as a
depositary for such global security and no successor depositary shall have
been appointed, or if at any time DTC ceases to be a clearing agency
registered under the Exchange Act, at a time when DTC is required to be so
registered to act as such depositary, (ii) the Corporation in its sole
discretion determines that such global security shall be so exchangeable, or
(iii) there shall have occurred and be continuing an event of default under
the Indenture with respect to the Junior Subordinated Debentures. Any global
security that is exchangeable pursuant to the preceding sentence shall be
exchangeable for definitive certificates registered in such names as DTC shall
direct. It is expected that such instructions will be based upon directions
received by DTC from its Participants with respect to ownership of beneficial
interests in such global security. In the event that Junior Subordinated
Debentures are issued in definitive form, such Junior Subordinated Debentures
will be in denominations of $1,000 and integral multiples thereof and may be
transferred or exchanged at the offices described below.
Payments on Junior Subordinated Debentures represented by a global security
will be made to DTC, as depositary for the Junior Subordinated Debentures. In
the event Junior Subordinated Debentures are issued in certificated form,
principal and interest will be payable, the transfer of the Junior
Subordinated Debentures will be registrable, and Junior Subordinated
Debentures will be exchangeable for Junior Subordinated Debentures of other
denominations of a like aggregate principal amount, at the corporate office of
the Debenture Trustee in New York, New York, or at the offices of any paying
agent or transfer agent appointed by the Corporation, provided that payment of
interest may be made at the option of the Corporation by check mailed to the
address of the persons entitled thereto or by wire transfer. For a description
of DTC and the terms of the depositary arrangements relating to payments,
transfers, voting rights, redemptions and other notices and other matters, see
"Book-Entry Issuance" in the accompanying Prospectus.
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<PAGE>
CERTAIN TERMS OF GUARANTEE
The Guarantee guarantees to the holders of the Capital Securities the
following payments, to the extent not paid by the Issuer: (i) any accumulated
and unpaid Distributions required to be paid on the Capital Securities, to the
extent that the Issuer has funds on hand available therefor at such time, (ii)
the Redemption Price with respect to any Capital Securities called for
redemption, to the extent that the Issuer has funds on hand available therefor
at such time, and (iii) upon a voluntary or involuntary dissolution, winding-
up or liquidation of the Issuer (unless the Junior Subordinated Debentures are
distributed to holders of the Capital Securities), the lesser of (a) the
aggregate of the Liquidation Amount and all accumulated and unpaid
Distributions to the date of payment, to the extent that the Issuer has funds
on hand available therefor at such time, and (b) the amount of assets of the
Issuer remaining available for distribution to holders of the Capital
Securities after payment of creditors of the Issuer as required by applicable
law. The Guarantee will be qualified as an indenture under the Trust Indenture
Act. Bankers Trust Company will act as the Guarantee Trustee for the purposes
of compliance with the Trust Indenture Act and will hold the Guarantee for the
benefit of the holders of the Capital Securities. Bankers Trust Company will
also act as Debenture Trustee for the Junior Subordinated Debentures and as
Property Trustee.
The holders of not less than a majority in aggregate Liquidation Amount of
the Capital Securities have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Guarantee Trustee in
respect to the Guarantee or to direct the exercise of any trust power
conferred upon the Guarantee Trustee under the Guarantee. Any holder of the
Capital Securities may institute a legal proceeding directly against the
Corporation to enforce its rights under the Guarantee without first
instituting a legal proceeding against the Issuer, the Guarantee Trustee or
any other person or entity. If the Corporation were to default on its
obligation to pay amounts payable under the Junior Subordinated Debentures,
the Issuer 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. Instead, if any event of default under
the Indenture shall have occurred and be continuing and such event is
attributable to the failure of the Corporation to pay interest or premium, if
any, on or principal of the Junior Subordinated Debentures on the applicable
payment date, then a holder of Capital Securities may institute a Direct
Action against the Corporation pursuant to the terms of the Indenture for
enforcement of payment to such holder of the principal of or interest or
premium, if any, on such Junior Subordinated Debentures having a principal
amount equal to the aggregate Liquidation Amount of the Capital Securities of
such holder. In connection with such Direct Action, the Corporation will have
a right to set-off under the Indenture to the extent of any payment made by
the Corporation to such holder of Capital Securities in the Direct Action.
Except as described herein, holders of Capital Securities will not be able to
exercise directly any other remedy available to the holders of the Junior
Subordinated Debentures or assert directly any other rights in respect of the
Junior Subordinated Debentures. See "Description of Guarantee" in the
accompanying Prospectus. The Trust Agreement provides that each holder of
Capital Securities by acceptance thereof agrees to the provisions of the
Guarantee, the Expense Agreement and the Indenture.
U.S. FEDERAL INCOME TAX CONSEQUENCES
The following is a summary of U.S. federal income tax consequences material
to the purchase, ownership and disposition of Capital Securities. This summary
does not purport to be a comprehensive description of all of the tax
consequences that may be relevant to a decision to purchase Capital Securities
by any particular investor, including tax consequences that arise from rules
of general application to all taxpayers or to certain classes of taxpayers or
that are generally assumed to be known by investors. This summary addresses
the tax consequences only to a person that acquires Capital Securities on
their original issue at their original offering price and that is (i) an
individual citizen
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<PAGE>
or resident of the United States, (ii) a corporation or partnership organized
in or under the laws of the United States or any state thereof or the District
of Columbia or (iii) otherwise subject to U.S. federal income taxation on a
net income basis in respect of the Capital Securities (a "United States
Holder"). This summary also does not address the tax consequences to (i)
persons that are not United States Holders, except as described below under
"--United States Alien Holders" (ii) persons that may be subject to special
treatment under United States federal income tax law, such as banks, insurance
companies, thrift institutions, regulated investment companies, real estate
investment trusts, tax-exempt organizations, traders in securities that elect
to mark to market and dealers in securities or currencies, (iii) persons that
will hold Capital Securities as part of a position in a "straddle" or as part
of a "hedging," "conversion" or other integrated investment transaction for
federal income tax purposes, (iv) persons whose functional currency is not the
United States dollar or (v) persons that do not hold Capital Securities as
capital assets.
This summary is based upon the U.S. Internal Revenue Code of 1986, as
amended (the "Code"), Treasury regulations, Internal Revenue Service rulings
and pronouncements and judicial decisions now in effect, all of which are
subject to change at any time. Such changes may be applied retroactively in a
manner that could cause the tax consequences to vary substantially from the
consequences described below, possibly adversely affecting a beneficial owner
of Capital Securities. For example, a judicial decision could be issued or
legislation could be enacted that would adversely affect the Corporation's
ability to deduct interest on the Junior Subordinated Debentures, either of
which might in turn permit the Corporation to cause a redemption of the
Capital Securities. See "--Possible Tax Law Changes". The authorities on which
this summary is based are subject to various interpretations, and it is
therefore possible that the federal income tax treatment of the purchase,
ownership and disposition of Capital Securities may differ from the treatment
described below. All references herein to federal tax refer to United States
federal tax.
PROSPECTIVE INVESTORS ARE ADVISED TO CONSULT WITH THEIR OWN TAX ADVISORS IN
LIGHT OF THEIR OWN PARTICULAR CIRCUMSTANCES AS TO THE UNITED STATES FEDERAL
TAX CONSEQUENCES OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF CAPITAL
SECURITIES, AS WELL AS THE EFFECT OF ANY STATE, LOCAL OR FOREIGN TAX LAWS.
CLASSIFICATION OF THE JUNIOR SUBORDINATED DEBENTURES AND THE ISSUER
In connection with the issuance of the Junior Subordinated Debentures,
Cleary, Gottlieb, Steen & Hamilton will render its opinion that, under then
current law and assuming full compliance with the terms of the Indenture (and
certain other documents), and based on certain facts and assumptions contained
in such opinion, the Junior Subordinated Debentures will be classified for
United States federal income tax purposes as indebtedness of the Corporation.
By acceptance of a Capital Security, each United States Holder covenants to
treat the Junior Subordinated Debentures as indebtedness of the Corporation
and the Capital Securities as an undivided beneficial ownership interest in
the Junior Subordinated Debentures.
In connection with the issuance of the Capital Securities, Cleary, Gottlieb,
Steen & Hamilton will render its opinion that, under current law and assuming
full compliance with the terms of the Trust Agreement and the Indenture (and
certain other documents), and based on certain facts and assumptions contained
in such opinion, the Issuer will be classified for United States federal
income tax purposes as a grantor trust and not as an association taxable as a
corporation. Accordingly, for United States federal income tax purposes, each
United States Holder of Capital Securities will be considered the owner of an
undivided beneficial ownership interest in the Junior Subordinated Debentures,
and each United States Holder will be required to include in its gross income
any interest (or original issue discount accrued) with respect to its
allocable share of those Junior Subordinated Debentures. See "--Interest
Income and Original Issue Discount".
S-25
<PAGE>
An opinion of Cleary, Gottlieb, Steen & Hamilton is not binding on the
Internal Revenue Service (the "IRS") or the courts. Prospective investors
should note that no rulings have been or are expected to be sought from the
IRS with respect to any of these issues and no assurance can be given that the
IRS will not take contrary positions. Moreover, no assurance can be given that
any of the opinions expressed herein will not be challenged by the IRS or, if
challenged, that such challenge will not be successful. See "--Possible Tax
Law Changes".
INTEREST INCOME AND ORIGINAL ISSUE DISCOUNT
Under Treasury regulations applicable to debt instruments issued on or after
August 13, 1996 (the "Regulations"), a contingency that stated interest will
not be timely paid that is "remote", because of the terms of the relevant debt
instrument, will be ignored in determining whether such debt instrument is
issued with original issue discount ("OID"). As a result of terms and
conditions of the Junior Subordinated Debentures that prohibit certain
payments with respect to the Corporation's capital stock and indebtedness if
the Corporation elects to extend interest payment periods, the Corporation
believes that the likelihood of its exercising its option to defer payments is
remote. See "Certain Terms of Junior Subordinated Debentures--Option to Defer
Interest Payments". Based on the foregoing, the Corporation believes that the
Junior Subordinated Debentures will not be considered to be issued with OID at
the time of their original issuance and, accordingly, a United States Holder
should include in gross income such holder's allocable share of interest on
the Junior Subordinated Debentures in accordance with such holder's normal
method of accounting for tax purposes.
If the option to defer any payment of interest was determined not to be
"remote" or if the Corporation exercises its option to defer any payment of
interest, the Junior Subordinated Debentures would be treated as issued with
OID at the time of issuance or at the time of such exercise, as the case may
be, and all stated interest on the Junior Subordinated Debentures would
thereafter be treated as OID as long as the Junior Subordinated Debentures
remained outstanding. In such event, all of a United States Holder's taxable
interest income with respect to the Junior Subordinated Debentures would be
accounted for as OID on a constant yield method regardless of such holder's
method of tax accounting, and actual distributions of stated interest would
not be reported as taxable income. Consequently, a United States Holder would
be required to include OID in gross income even though the Corporation would
not make any actual cash payments during an Extension Period.
The Regulations have not been addressed in any rulings or other
interpretations by the IRS, and it is possible that the IRS could take a
position contrary to the interpretation herein.
Because income on the Capital Securities will constitute interest or OID,
corporate United States Holders of the Capital Securities will not be entitled
to a dividends-received deduction with respect to any income recognized with
respect to the Capital Securities.
DISTRIBUTION OF JUNIOR SUBORDINATED DEBENTURES TO HOLDERS OF CAPITAL
SECURITIES UPON LIQUIDATION OF THE ISSUER
Under current law, a distribution by the Issuer of the Junior Subordinated
Debentures as described under the caption "Certain Terms of Capital
Securities--Liquidation of Issuer and Distribution of Junior Subordinated
Debentures to Holders" will be non-taxable and will result in the United
States Holder receiving directly its pro rata share of the Junior Subordinated
Debentures previously held indirectly through the Issuer, with a holding
period and aggregate tax basis equal to the holding period and aggregate tax
basis such United States Holder had in its Capital Securities before such
distribution. If, however, the liquidation of the Issuer were to occur because
the Issuer is subject to United States federal income tax with respect to
income accrued or received on the Junior Subordinated Debentures, as would be
the case if, for example, the Issuer were treated as an association taxable as
a corporation, the distribution of Junior Subordinated Debentures to a United
States Holder by the
S-26
<PAGE>
Issuer would be a taxable event to the Issuer and each United States Holder,
and each United States Holder would recognize gain or loss as if the United
States Holder had exchanged its Capital Securities for the Junior Subordinated
Debentures it received upon the liquidation of the Issuer. A United States
Holder will include interest in income in respect of Junior Subordinated
Debentures received from the Issuer in the manner described above under "--
Interest Income and Original Issue Discount".
SALE OR REDEMPTION OF CAPITAL SECURITIES
A United States Holder that sells (including a redemption for cash of its
Capital Securities) Capital Securities will recognize gain or loss equal to
the difference between its adjusted tax basis in the Capital Securities and
the amount realized on the sale of such Capital Securities. Assuming that the
Corporation does not exercise its option to defer payment of interest on the
Junior Subordinated Debentures and the Junior Subordinated Debentures are not
considered issued with OID, a United States Holder's adjusted tax basis in the
Capital Securities generally will be its initial purchase price. If the Junior
Subordinated Debentures are deemed to be issued with OID, as a result of the
Corporation's deferral of interest payments, a United States Holder's adjusted
tax basis in the Capital Securities generally will be its initial purchase
price, increased by OID previously includible in such United States Holder's
gross income to the date of disposition and decreased by Distributions or
other payments received on the Capital Securities since and including the date
of the first Extension Period. Such gain or loss generally will be a capital
gain or loss (except to the extent any amount realized is treated as a payment
of accrued interest with respect to such United States Holder's pro rata share
of the Junior Subordinated Debentures required to be included in income).
Capital gain derived by non-corporate United States Holders on the sale of
Capital Securities that have been held for more than eighteen months will be
subject to a 20% maximum tax rate and capital gain derived by non-corporate
United States Holders on the sale of Capital Securities that have been held
for more than one year but less than eighteen months will be subject to a 28%
maximum tax rate. To the extent the selling price is less than the United
States Holder's adjusted tax basis, such holder will recognize a capital loss.
Subject to certain limited exceptions, capital losses cannot be applied to
offset ordinary income for United States federal income tax purposes.
The Capital Securities may trade at a price that does not accurately reflect
the value of accrued but unpaid interest with respect to the underlying Junior
Subordinated Debentures. A United States Holder who uses the accrual method of
accounting for tax purposes (and a cash method holder, if the Junior
Subordinated Debentures are deemed to have been issued with OID) who disposes
of its Capital Securities between record dates for payments of distributions
thereon will be required to include accrued but unpaid interest on the Junior
Subordinated Debentures through the date of disposition in income as ordinary
income (i.e., interest or, possibly, OID), and to add such amount to the
United States Holder's adjusted tax basis in the pro rata share of the
underlying Junior Subordinated Debentures deemed disposed of. To the extent
the selling price is less than the United States Holder's adjusted tax basis
(which will include all accrued but unpaid interest) a United States Holder
will recognize a capital loss. Subject to certain limited exceptions, capital
losses cannot be applied to offset ordinary income for U.S. federal income tax
purposes.
BACKUP WITHHOLDING TAX AND INFORMATION REPORTING
The amount of interest income paid and OID accrued on the Capital Securities
held of record by United States Holders (other than corporations and other
exempt United States Holders) will be reported to the IRS. "Backup"
withholding at a rate of 31% will apply to payments of interest to a nonexempt
United States Holder unless the United States 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.
S-27
<PAGE>
Payment of the proceeds from the disposition of Capital Securities to or
through the 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 United States Holder under the backup
withholding rules will be allowed as a refund or a credit against such United
States Holder's United States federal income tax liability, provided the
required information is furnished to the IRS.
It is anticipated that income on the Capital Securities will be reported to
holders on Form 1099-INT or, if the Corporation exercises its option to defer
any payment of interest, on Form 1099-OID, and mailed to holders of the
Capital Securities by January 31 following each calendar year.
POSSIBLE TAX LAW CHANGES
Prospective investors should be aware that Enron Corporation has filed a
petition in U.S. Tax Court challenging the proposed disallowance by the IRS of
the deduction of interest expense on securities issued by Enron Corporation in
1993 and 1994 that are similar to, although different in a number of respects
from, the Junior Subordinated Debentures. It is possible that a decision in
that case could give rise to a Tax Event, which would permit the Corporation
to cause a redemption of the Capital Securities, as described more fully under
"Description of Capital Securities--Redemption or Exchange" in the
accompanying Prospectus. Prospective investors also should be aware that
legislation has been proposed by the Clinton Administration in the past that,
if enacted, would have denied an interest deduction to issuers of instruments
such as the Junior Subordinated Debentures. No such legislation is currently
pending. There can be no assurance, however, that similar legislation will not
ultimately be enacted into law, or that other developments will not occur on
or after the date hereof that would adversely affect the tax treatment of the
Junior Subordinated Debentures or the Issuer. Such changes also could give
rise to a Tax Event.
UNITED STATES ALIEN HOLDERS
For purposes of this discussion, a "United States Alien Holder" is a holder
of Capital Securities that is a nonresident alien individual or a foreign
corporation. Under present United States federal income tax laws: (i) payments
by the Issuer or any of its paying agents to any holder of a Capital Security
who or which is a United States Alien Holder will not be subject to
withholding of United States federal income tax; provided that, (a) the
beneficial owner of the Capital Security does not actually or constructively
own 10 percent or more of the total combined voting power of all classes of
stock of the Corporation entitled to vote, (b) the beneficial owner of the
Capital Security is not a controlled foreign corporation that is related to
the Corporation through stock ownership, and (c) either (A) the beneficial
owner of the Capital Security certifies to the Issuer or its agent, under
penalty of perjury, that it is not a United States Holder and provides its
name and address or (B) a securities clearing organization, bank or other
financial institution that holds customers' securities in the ordinary course
of its trade or business (a "Financial Institution"), and holds the Capital
Security in such capacity, certifies to the Issuer or its agent, under penalty
of perjury, that such statement has been received from the beneficial owner by
it or by a Financial Institution between it and the beneficial owner and
furnishes the Issuer or its agent with a copy thereof; and (ii) a United
States Alien Holder of a Capital Security will generally not be subject to
withholding of United States federal income tax on any gain realized upon the
sale or other disposition of a Capital Security provided the gain is not
effectively connected with the conduct of a trade or business in the United
States by the United States Alien Holder.
On October 6, 1997, the Treasury Department issued new regulations (the "New
Regulations") which may make certain modifications to the withholding, backup
withholding and information reporting rules described above. The New
Regulations attempt to unify certification requirements and modify reliance
standards. The New Regulations will generally be effective for payments made
after December 31, 1999, subject to certain transition rules. Prospective
investors are urged to consult their own tax advisors regarding the New
Regulations.
S-28
<PAGE>
CERTAIN ERISA CONSIDERATIONS
Each fiduciary of a pension, profit-sharing or other employee benefit plan
subject to the Employee Retirement Income Security Act of 1974, as amended
("ERISA") (a "Plan"), should consider the fiduciary standards of ERISA in the
context of the Plan's particular circumstances before authorizing an
investment in the Capital Securities. Accordingly, among other factors, the
fiduciary should consider whether the investment would satisfy the prudence
and diversification requirements of ERISA and would be consistent with the
documents and instruments governing the Plan.
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 engaging in certain transactions involving "plan
assets" with persons who are "parties in interest" under ERISA or
"disqualified persons" under the Code ("Parties in Interest") 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) (5) of ERISA) are not subject to the requirements of ERISA or
Section 4975 of the Code.
Under a regulation (the "Plan Assets Regulation") issued by the U.S.
Department of Labor ("DOL"), the assets of the Issuer would be deemed to be
"plan assets" of a Plan for purposes of ERISA and Section 4975 of the Code if
"plan assets" of the Plan were used to acquire Capital Securities issued by
the Issuer and no exception were applicable under the Plan Assets Regulation.
Pursuant to an exception contained in the Plan Assets Regulation, the assets
of the Issuer would not be deemed to be "plan assets" of investing Plans if,
immediately after the most recent acquisition of any Capital Securities issued
by the Issuer, less than 25% of the value of each class of Capital Securities
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 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 of the Issuer held by Benefit Plan investors will be less
than 25% of the total value of such Capital Securities of the Issuer at the
completion of the initial offering or thereafter, 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 by the
Corporation.
Certain transactions involving the Issuer could be deemed to constitute
direct or indirect prohibited transactions under ERISA and Section 4975 of the
Code with respect to a Plan if the Capital Securities of the Issuer were
acquired with "plan assets" of such Plan and assets of the Issuer were deemed
to be "plan assets" of Plans investing in the Issuer. For example, if the
Corporation is a Party in Interest with respect to an investing Plan (either
directly or by reason of its ownership of its subsidiaries), extensions of
credit between the Corporation and the Issuer (as represented by the Junior
Subordinated Debentures and the Guarantee) would likely be prohibited by
Section 406(a) (1) (B) of ERISA and Section 4975(c) (1) (B) of the Code,
unless exemptive relief were available under an applicable administrative
exemption (see below).
The DOL has issued five prohibited transaction class exemptions ("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 Issuer were deemed to be "plan assets" of Plans
investing in the Issuer (see above). Those class exemptions are PTCE 96-23
(for certain transactions determined by in-house asset managers), PTCE 95-60
(for certain transactions involving insurance company general accounts), PTCE
91-38 (for certain transactions involving bank collective investment
S-29
<PAGE>
funds), PTCE 90-1 (for certain transactions involving insurance company
separate accounts), and PTCE 84-14 (for certain transactions determined by
independent qualified asset managers).
The Capital Securities may not be purchased or held by any Plan, any entity
whose underlying assets include "plan assets" by reason of any Plan's
investment in the entity (a "Plan Asset Entity") or any person investing "plan
assets" of any Plan, unless such purchaser or holder is eligible for the
exemptive relief available under PTCE 96-23, 95-60, 91-38, 90-1, or 84-14. 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 it either
(a) 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) is eligible for the
exemptive relief available under PTCE 96-23, 95-60, 91-38, 90-1 or 84-14 with
respect to such purchase or holding.
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 considering
purchasing the Capital Securities on behalf of or with "plan assets" of any
Plan consult with their counsel regarding the potential consequences if the
assets of the Issuer are deemed to be "plan assets" and the availability of
exemptive relief under PTCE 96-23, 95-60, 91-38, 90-1 or 84-14.
S-30
<PAGE>
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting Agreement,
the Corporation and the Issuer have agreed that the Issuer will sell to each
of the Underwriters named below, and each of such Underwriters have severally
agreed to purchase from the Issuer, the respective number of Capital
Securities set forth opposite their names below.
<TABLE>
<CAPTION>
NUMBER OF
CAPITAL
UNDERWRITER SECURITIES
- ----------- ----------
<S> <C>
............................................................
---
Total..............................................................
===
</TABLE>
Under the terms and conditions of the Underwriting Agreement and the Pricing
Agreement, the Underwriters are committed to take and pay for all of the
Capital Securities, if any are taken.
The Underwriters have advised the Corporation that they propose initially to
offer the Capital Securities to the public at the initial public offering
price set forth on the cover page of this Prospectus Supplement and in part to
certain dealers at such price less a concession not in excess of $ per
Capital Security. The Underwriters may allow, and such dealers may re-allow, a
discount not in excess of $ per Capital Security to certain other dealers.
After the Capital Securities are released for sale to the public, the public
offering price, and other selling terms may from time to time be varied by the
Underwriters.
In view of the fact that the proceeds from the sale of the Capital
Securities will be used to purchase the Junior Subordinated Debentures issued
by the Corporation, the Underwriting Agreement provides that the Corporation
will pay as Underwriters' compensation for the Underwriters' arranging the
investment therein of such proceeds an amount of $ per Capital Security for
the accounts of the several Underwriters.
The Corporation and the Issuer have agreed that, during the period beginning
from the date of the Underwriting Agreement and continuing to and including
the earlier of (i) the termination of trading restrictions on the Capital
Securities, as determined by the Underwriters, and (ii) 30 days after the
closing date, they will not offer, sell, contract to sell or otherwise dispose
of any Capital Securities, any other beneficial interests in the assets of the
Issuer, or any preferred securities or any other securities of the Issuer or
the Corporation which are substantially similar to the Capital Securities,
including any guarantee of such securities, or any securities convertible into
or exchangeable for or representing the right to receive securities, preferred
securities or any such substantially similar securities of either the Issuer
or the Corporation, without the prior written consent of the Underwriters,
except for the Capital Securities offered in connection with this offering.
Prior to this offering, there has been no public market for the Capital
Securities. The representatives of the Underwriters have advised the
Corporation that they intend to make a market in the Capital Securities but
are not obligated to do so and may discontinue market making at any time
without notice. No assurance can be given as to the liquidity of the trading
market for the Capital Securities.
In connection with the offering, the Underwriters may purchase and sell the
Capital Securities in the open market. These transactions may include over-
allotment and stabilizing transactions and purchases to cover syndicate short
positions created in connection with the offering. Stabilizing transactions
consist of certain bids or purchases for the purpose of preventing or
retarding a decline in the market price of the Capital Securities, and
syndicate short positions involve the sale by the Underwriters of a greater
number of Capital Securities than they are required to purchase from the
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<PAGE>
Issuer in the offering. The Underwriters also may impose a penalty bid,
whereby selling concessions allowed to syndicate members or other broker-
dealers in respect of the Capital Securities sold in the offering for their
account may be reclaimed by the syndicate if such Capital Securities are
repurchased by the syndicate in stabilizing or covering transactions. These
activities may stabilize, maintain or otherwise affect the market price of the
Capital Securities, which may be higher than the price that might otherwise
prevail in the open market; and these activities, if commenced, may be
discontinued at any time. These transactions may be effected on a national
securities exchange, in the over-the-counter market or otherwise.
The Corporation and the Issuer have agreed to indemnify the several
Underwriters against, or contribute to payments that the Underwriters may be
required to make in respect of, certain liabilities, including liabilities
under the Securities Act of 1933, as amended.
Certain of the Underwriters or their affiliates have provided from time to
time, and expect to provide in the future, investment or commercial banking
services to the Corporation and its affiliates, for which such Underwriters or
their affiliates have received or will receive customary fees and commissions.
VALIDITY OF SECURITIES
Certain matters of Delaware law relating to the validity of the Capital
Securities, the enforceability of the Trust Agreement and the formation of the
Issuer will be passed upon by Richards, Layton & Finger, P.A., special
Delaware Counsel to the Corporation and the Issuer. The validity of the
Guarantee and the Junior Subordinated Debentures will be passed upon for the
Corporation by Louise M. Parent, Executive Vice President and General Counsel
of the Corporation and for the Underwriters by Sullivan & Cromwell. Sullivan &
Cromwell will rely on the opinion of Richards, Layton & Finger, P.A. as to
matters of Delaware law. Certain matters relating to United States federal
income tax considerations will be passed upon for the Corporation by Cleary,
Gottlieb, Steen & Hamilton.
S-32
<PAGE>
$500,000,000
AMERICAN EXPRESS COMPANY
JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES
AMERICAN EXPRESS COMPANY CAPITAL TRUST I
AMERICAN EXPRESS COMPANY CAPITAL TRUST II
CAPITAL SECURITIES FULLY AND UNCONDITIONALLY
GUARANTEED, AS DESCRIBED HEREIN, BY
AMERICAN EXPRESS COMPANY
----------------
American Express Company, a New York corporation (the "Corporation"), may
from time to time offer in one or more series or issuances its junior
subordinated deferrable interest debentures (the "Junior Subordinated
Debentures"). The Junior Subordinated Debentures will be unsecured and
subordinate and junior in right of payment to all Senior Debt (as defined in
"Description of Junior Subordinated Debentures--Subordination") of the
Corporation. The Corporation will have the right to defer payments of interest
on any series of Junior Subordinated Debentures by extending the interest
payment period thereon at any time or from time to time for up to such number
of consecutive interest payment periods (which shall not extend beyond the
Stated Maturity (as defined herein) of the Junior Subordinated Debentures)
with respect to each deferral period as may be specified in the applicable
Prospectus Supplement (each, an "Extension Period"). In such circumstances,
however, the Corporation would not be permitted, subject to certain exceptions
set forth herein, to declare or pay any dividends, distributions or other
payments with respect to, or repay, repurchase, redeem or otherwise acquire,
the Corporation's capital stock or debt securities that rank pari passu in all
respects with or junior to the Junior Subordinated Debentures. See
"Description of Junior Subordinated Debentures--Option to Defer Interest
Payments" and "--Restrictions on Certain Payments".
American Express Company Capital Trust I and American Express Company
Capital Trust II, each a statutory business trust created under the laws of
the State of Delaware (each, an Issuer and collectively, the "Issuers"), may
severally offer, from time to time, capital securities (the "Capital
Securities") representing beneficial interests in such Issuer. The Corporation
will be the owner of the common securities representing common ownership
interests in such Issuer (the "Common Securities" and, together with the
Capital Securities, the "Trust Securities"). Holders of the Capital Securities
will be entitled to receive preferential cumulative cash distributions
("Distributions") accumulating from the date of original issuance and payable
periodically as provided in an accompanying Prospectus Supplement.
Concurrently with the issuance by an Issuer of its Capital Securities, such
Issuer will invest the proceeds thereof and of any contributions received in
respect of the Common Securities in a corresponding series of the
Corporation's Junior Subordinated Debentures (the "Corresponding Junior
Subordinated Debentures") with terms corresponding to the terms of that
Issuer's Capital Securities (the "Related Capital Securities"). The
Corresponding Junior Subordinated Debentures will be the sole assets of each
Issuer, and payments under the Corresponding Junior Subordinated Debentures
will be the only revenue of each Issuer. If provided in an accompanying
Prospectus Supplement, the Corporation may redeem the Corresponding Junior
Subordinated Debentures (and cause the redemption of the related Trust
Securities) or may terminate each Issuer and cause the Corresponding Junior
Subordinated Debentures to be distributed to the holders of the Related
Capital Securities in liquidation of their interests in such Issuer. See
"Description of Capital Securities--Liquidation Distribution Upon
Termination".
(continued on next page)
----------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURI-
TIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
----------------
The date of this Prospectus is , 1998
<PAGE>
(cover page continued)
If provided in the accompanying Prospectus Supplement, the Corporation will
have the right to defer payments of interest on any series of Corresponding
Junior Subordinated Debentures. If interest payments are so deferred,
Distributions on the Related Capital Securities will also be deferred and the
Corporation will not be permitted, subject to certain exceptions set forth
herein, to declare or pay any cash distributions with respect to the
Corporation's capital stock or debt securities that rank pari passu with or
junior to the Corresponding Junior Subordinated Debentures. During an
Extension Period, Distributions will continue to accumulate (and the Capital
Securities will accumulate additional Distributions thereon at the rate set
forth in the Prospectus Supplement). See "Description of Capital Securities--
Distributions".
Taken together, the Corporation's obligations under each series of Junior
Subordinated Debentures, the Indenture, the related Trust Agreement, the
related Expense Agreement and the related Guarantee (each, as defined herein),
in the aggregate, provide a full, irrevocable and unconditional guarantee of
payments of distributions and other amounts due on the related series of
Capital Securities. See "Relationship Among the Capital Securities, the
Corresponding Junior Subordinated Debentures, the Expense Agreements and the
Guarantees--Full and Unconditional Guarantee". The payment of Distributions
with respect to the Capital Securities of each Issuer and payments on
liquidation or redemption with respect to such Capital Securities, in each
case out of funds held by such Issuer, are each irrevocably guaranteed by the
Corporation to the extent described herein (each, a "Guarantee"). See
"Description of Guarantees". The obligations of the Corporation under each
Guarantee will be subordinate and junior in right of payment to all Senior
Debt of the Corporation.
The Junior Subordinated Debentures and the Capital Securities may be offered
at prices and on terms to be determined at the time of offering; provided,
however, that the aggregate initial offering price of all Junior Subordinated
Debentures (other than Corresponding Junior Subordinated Debentures) and
Capital Securities (including the Corresponding Junior Debentures) issued
pursuant to the Registration Statement of which this Prospectus forms a part
shall not exceed $500,000,000. Certain specific terms of the Junior
Subordinated Debentures or Capital Securities in respect of which this
Prospectus is being delivered will be described in an accompanying Prospectus
Supplement, including without limitation and where applicable and to the
extent not set forth herein, (a) in the case of Junior Subordinated
Debentures, the specific designation, aggregate principal amount,
denominations, Stated Maturity (including any provisions for the shortening or
extension thereof), interest payment dates, interest rate (which may be fixed
or variable) or method of calculating interest, if any, applicable Extension
Period or interest deferral terms, if any, place or places where principal,
premium, if any, and interest, if any, will be payable, any terms of
redemption, initial offering or purchase price, methods of distribution and
any other special terms, and (b) in the case of Capital Securities, the
identity of the Issuer, specific title, aggregate amount, stated liquidation
amount, number of securities, Distribution rate or method of calculating such
rate, Distribution payment dates, applicable Distribution deferral terms, if
any, place or places where Distributions will be payable, any terms of
redemption or, exchange, initial offering or purchase price, methods of
distribution and any other special terms.
The Prospectus Supplement also will contain information, as applicable,
about certain United States federal income tax consequences relating to the
Junior Subordinated Debentures and the Capital Securities.
The Junior Subordinated Debentures and the Capital Securities may be sold to
or through underwriters, through dealers, remarketing firms or agents or
directly to purchasers. See "Plan of Distribution". The names of any
underwriters, dealers, remarketing firms or agents involved in the sale of
Junior Subordinated Debentures or the Capital Securities in respect of which
this Prospectus is being delivered and any applicable fee, commission or
discount arrangements with them will be set forth in a Prospectus Supplement.
The Prospectus Supplement will state whether the Junior Subordinated
Debentures or Capital Securities will be listed on any national securities
exchange or automated quotation system. If the Junior Subordinated Debentures
or Capital Securities are not listed on any national securities exchange or
automated quotation system, there can be no assurance that there will be a
secondary market for the Junior Subordinated Debentures or Capital Securities.
This Prospectus may not be used to consummate sales of Junior Subordinated
Debentures or the Capital Securities unless accompanied by a Prospectus
Supplement.
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AVAILABLE INFORMATION
The Corporation is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith, files reports, proxy statements and other information
with the Securities and Exchange Commission (the "Commission"). Such reports,
proxy statements and other information can be inspected and copied at the
public reference facilities of the Commission at Room 1024, 450 Fifth Street,
N.W., Washington, D.C. 20549 and at the regional offices of the Commission
located at 7 World Trade Center, 13th Floor, Suite 1300, New York, New York
10048 and Suite 1400, Citicorp Center, 14th Floor, 500 West Madison Street,
Chicago, Illinois 60661. Copies of such material can also be obtained at
prescribed rates by writing to the Public Reference Section of the Commission
at 450 Fifth Street, N.W., Washington, D.C. 20549. Such material may also be
accessed electronically by means of the Commission's home page on the Internet
at http://www.sec.gov. In addition, such reports, proxy statements and other
information concerning the Corporation can be inspected at the offices of the
New York Stock Exchange, Inc., 20 Broad Street, New York, New York 10005, at
the offices of the Pacific Stock Exchange, Inc., 301 Pine Street, San
Francisco, California 94104, at the offices of the Chicago Stock Exchange,
Inc., 440 South LaSalle Street, Chicago, Illinois 60605, and at the offices of
the Boston Stock Exchange, Inc., One Boston Place, Boston, Massachusetts
02108.
The Corporation and the Issuers have filed with the Commission a
Registration Statement on Form S-3 (together with all amendments and exhibits
thereto, the "Registration Statement") under the Securities Act of 1933, as
amended (the "Securities Act"), with respect to the securities offered hereby.
This Prospectus does not contain all 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 Corporation and the securities offered hereby,
reference is made to the Registration Statement and the exhibits and the
financial statements, notes and schedules filed as a 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 or
through the Commission's home page on the Internet. 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 any Issuer have been included herein.
The Corporation and the Issuers do not consider that such financial statements
would be material to holders of the Capital Securities because each Issuer is
a newly formed special purpose entity, has no operating history or independent
operations and is not engaged in and does not propose to engage in any
activity other than holding as trust assets the Corresponding Junior
Subordinated Debentures of the Corporation and issuing the Trust Securities.
Furthermore, taken together, the Corporation's obligations under each series
of Corresponding Junior Subordinated Debentures, the Indenture, the related
Trust Agreement, the related Expense Agreement and the related Guarantee
provide, in the aggregate, a full, irrevocable and unconditional guarantee of
payments of Distributions and other amounts due on the Capital Securities of
an Issuer. See "The Issuers", "Description of Capital Securities",
"Description of Junior Subordinated Debentures--Corresponding Junior
Subordinated Debentures" and "Description of Guarantees". In addition, the
Corporation does not expect that any of the Issuers will be filing reports
under the Exchange Act with the Commission.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Corporation with the Commission are
incorporated into this Prospectus by reference:
1. The Corporation's Annual Report on Form 10-K for the year ended
December 31, 1997 dated March 30, 1998;
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2. The Corporation's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1998; and
3. The Corporation's Current Reports on Form 8-K dated January 26, 1998,
February 4, 1998, February 10, 1998, April 16, 1998, April 23, 1998 and
April 29, 1998.
Each document or report filed by the Corporation pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act after the date hereof and prior to the
termination of any offering of securities made by this Prospectus shall be
deemed to be incorporated by reference into this Prospectus and to be a part
of this Prospectus from the date of filing of such document. Any statement
contained herein, or in a document all or a portion of which is incorporated
or deemed to be incorporated by reference herein, shall be deemed to be
modified or superseded for purposes of the Registration Statement and this
Prospectus to the extent that a statement contained herein or in any other
subsequently filed document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of the Registration Statement or this
Prospectus.
The Corporation will provide without charge to any person to whom this
Prospectus is delivered, on the written or oral request of such person, a copy
of any or all of the foregoing documents incorporated by reference herein
(other than exhibits not specifically incorporated by reference into the texts
of such documents). Requests for such documents should be directed to Mr.
Stephen P. Norman, Secretary, American Express Company, World Financial
Center, 200 Vesey Street, New York, New York 10285, telephone number (212)
640-2000.
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THE CORPORATION
Through its subsidiaries, the Company is primarily engaged in the business
of providing travel related services, financial advisory services and
international banking services throughout the world.
Travel related services are offered principally through American Express
Travel Related Services Company, Inc. and its subsidiaries ("TRS") and include
a variety of products and services, including the American Express(R) Card,
the Optima(R) Card and other consumer and corporate lending products (the
"Cards"), the American Express(R) Travelers Cheque (the "Travelers Cheque")
and other stored value products, business expense management products and
services, tax preparation and bookkeeping services, corporate and consumer
travel products and services, magazine publishing, and management and merchant
transaction processing, point of sale and back office products and services.
At December 31, 1997, there were 42.7 million Cards in force worldwide, and
worldwide Card billed business for the year ended December 31, 1997 was $209.2
billion. U.S. consumer lending operations are conducted by American Express
Centurion Bank, a wholly-owned subsidiary of TRS whose deposits are insured by
the Federal Deposit Insurance Corporation. Travelers Cheque sales for the year
ended December 31, 1997 were $25 billion.
American Express Financial Corporation ("AEFC") and its subsidiaries are
engaged in providing a variety of financial products and services to help
individuals, businesses and institutions establish and achieve their financial
goals. AEFC's products and services include financial planning and advice,
insurance and annuities, a variety of investment products, including
investment certificates, mutual funds and limited partnerships, investment
advisory services, trust and employee plan administration services, personal
auto and homeowner's insurance and retail securities brokerage services. At
December 31, 1997, American Express Financial Advisors Inc. ("AEFA"), AEFC's
principal marketing subsidiary, maintained a nationwide financial planning
field force of 8,776 persons. At December 31, 1997, AEFA's assets owned and/or
managed totaled approximately $173.4 billion.
American Express Bank Ltd., together with its subsidiaries ("AEBL") offers
products that meet the financial service needs of four client groups:
corporations, financial institutions, affluent individuals and retail
customers. AEBL's five primary business lines are corporate banking and
finance, correspondent banking, private banking, personal financial services
and global trading. AEBL does not do business in the United States except as
an incident to its activities outside the United States.
The Corporation has its principal executive offices at World Financial
Center, 200 Vesey Street, New York, New York 10285, telephone number (212)
640-2000.
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THE ISSUERS
Each Issuer is a statutory business trust created under Delaware law
pursuant to (i) a trust agreement executed by the Corporation, as Depositor of
the Issuer and the Delaware Trustee of the Issuer (each as defined herein) and
(ii) the filing of a certificate of trust with the Delaware Secretary of
State. Each trust agreement will be amended and restated in its entirety
(each, as so amended and restated, a "Trust Agreement") substantially in the
form filed as an exhibit to the Registration Statement of which this
Prospectus forms a part. Each Trust Agreement will be qualified as an
indenture under the Trust Indenture Act of 1939, as amended (the "Trust
Indenture Act"). Each Issuer exists for the exclusive purposes of (i) issuing
and selling the Trust Securities, (ii) using the proceeds from the sale of
such Trust Securities to acquire a series of Corresponding Junior Subordinated
Debentures issued by the Corporation and (iii) engaging in only those other
activities necessary or incidental thereto (such as registering the transfer
of the Trust Securities). Accordingly, the Corresponding Junior Subordinated
Debentures and the right to reimbursement of expenses under the related
Expense Agreement will be the sole assets of each Issuer, and payments under
the Corresponding Junior Subordinated Debentures and the related Expense
Agreement will be the sole revenue of each Issuer.
All of the Common Securities of each Issuer will be owned by the
Corporation. The Common Securities of an Issuer will rank pari passu, and
payments will be made thereon pro rata, with the Capital Securities of such
Issuer, except that upon the occurrence and continuance of an event of default
under the Trust Agreement resulting from an event of default under the
Indenture, the rights of the Corporation, as holder of the Common Securities,
to payment in respect of Distributions and payments upon liquidation or
redemption will be subordinated to the rights of the holders of the Capital
Securities of such Issuer. See "Description of Capital Securities--
Subordination of Common Securities." The Corporation will acquire Common
Securities in an aggregate Liquidation Amount equal to not less than 3% of the
total capital of each Issuer.
Unless otherwise specified in the Prospectus Supplement, each Issuer has a
term of approximately 55 years, but may terminate earlier as provided in the
Trust Agreement. Each Issuer's business and affairs are conducted by its
trustees. The trustees of each Issuer will be Bankers Trust Company, as the
Property Trustee (the "Property Trustee"), and Bankers Trust (Delaware), as
the Delaware Trustee (the "Delaware Trustee") (collectively, "Issuer
Trustees"). In addition, two individuals who are employees or officers of or
affiliated with the holder of a majority of the Common Securities will act as
administrators with respect to each Issuer (the "Administrators"). The
Administrators will be selected by the holder of the Common Securities.
Bankers Trust Company will act as sole indenture trustee under each Trust
Agreement for purposes of compliance with the Trust Indenture Act. Bankers
Trust Company will also act as trustee under the Guarantees and the Indenture.
See "Description of Guarantees" and "Description of Junior Subordinated
Debentures." The duties and obligations of each Issuer are governed by the
applicable Trust Agreement. The Corporation will pay all fees and expenses
related to each Issuer and the offering of the Capital Securities and will
pay, directly or indirectly, all ongoing costs, expenses and liabilities of
each Issuer.
Bankers Trust Company has extended lines of credit to the Corporation and,
as either principal or fiduciary, may own debt of the Corporation. The
Corporation and its subsidiaries have other customary banking relationships
with Bankers Trust Company in the ordinary course of business.
The principal executive office of each Issuer is at World Financial Center,
200 Vesey Street, New York, New York 10285, and its telephone number is (212)
640-2000.
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USE OF PROCEEDS
Except as otherwise set forth in the applicable Prospectus Supplement, the
Corporation intends to use the proceeds from the sale of its Junior
Subordinated Debentures (including Corresponding Junior Subordinated
Debentures issued to Issuers in connection with the investment by the Issuers
of all the proceeds from the sale of Capital Securities) for general corporate
purposes.
DESCRIPTION OF JUNIOR SUBORDINATED DEBENTURES
The Junior Subordinated Debentures are to be issued in one or more series
under a Junior Subordinated Indenture, as supplemented from time to time (as
so supplemented, the "Indenture"), between the Corporation and Bankers Trust
Company, as trustee (the "Debenture Trustee"). This summary of certain terms
and provisions of the Junior Subordinated Debentures and the Indenture, which
summarizes the material provisions thereof, does not purport to be complete
and is subject to, and is qualified in its entirety by reference to, the
Indenture, the form of which is filed as an exhibit to the Registration
Statement of which this Prospectus forms a part, and to the Trust Indenture
Act, to each of which reference is hereby made. The Indenture is qualified
under the Trust Indenture Act. Whenever particular defined terms of the
Indenture (as supplemented or amended from time to time) are referred to
herein or in a Prospectus Supplement, such defined terms are incorporated
herein or therein by reference.
GENERAL
Each series of Junior Subordinated Debentures will rank pari passu with all
other series of Junior Subordinated Debentures and will be unsecured and
subordinate and junior in right of payment to the extent and in the manner set
forth in the Indenture to all Senior Debt (as defined below) of the
Corporation. See "--Subordination". The Corporation is a non-operating holding
company and almost all of the operating assets of the Corporation and its
consolidated subsidiaries are owned by such subsidiaries. The Corporation
relies primarily on dividends from such subsidiaries to meet its obligations.
Because the Corporation is a holding company, the right of the Corporation to
participate in any distribution of assets of any subsidiary upon such
subsidiary's liquidation or reorganization or otherwise, is subject to the
prior claims of creditors of the subsidiary, except to the extent the
Corporation may itself be recognized as a creditor of that subsidiary.
Accordingly, the Junior Subordinated Debentures will be effectively
subordinated to all existing and future liabilities of the Corporation's
subsidiaries, and holders of Junior Subordinated Debentures should look only
to the assets of the Corporation for payments on the Junior Subordinated
Debentures. Except as otherwise provided in the applicable Prospectus
Supplement, the Indenture does not limit the incurrence or issuance of other
secured or unsecured debt of the Corporation, including Senior Debt, whether
under the Indenture, any other existing indenture or any other indenture that
the Corporation may enter into in the future or otherwise. See "--
Subordination" and the Prospectus Supplement relating to any offering of
Capital Securities or Junior Subordinated Debentures.
The Junior Subordinated Debentures will be issuable in one or more series
pursuant to an indenture supplemental to the Indenture or a resolution of the
Corporation's Board of Directors or a committee thereof.
The applicable Prospectus Supplement or Prospectus Supplements will describe
the following terms of the Junior Subordinated Debentures: (i) the title of
the Junior Subordinated Debentures; (ii) any limit upon the aggregate
principal amount of the Junior Subordinated Debentures; (iii) the date or
dates on which the principal of the Junior Subordinated Debentures is payable
(the "Stated Maturity") or the method of determination thereof; (iv) the rate
or rates, if any, at which the Junior Subordinated Debentures shall bear
interest, the dates on which any such interest shall be payable (the "Interest
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Payment Dates"), the right, if any, of the Corporation to defer or extend an
Interest Payment Date, and the record dates for any interest payable on any
Interest Payment Date or the method by which any of the foregoing shall be
determined; (v) the place or places where, subject to the terms of the
Indenture as described below under "--Payment and Paying Agents," the
principal of and premium, if any, and interest on the Junior Subordinated
Debentures will be payable and where, subject to the terms of the Indenture as
described below under "--Denominations, Registration and Transfer," the Junior
Subordinated Debentures may be presented for registration of transfer or
exchange and the place or places where notices and demands to or upon the
Corporation in respect of the Junior Subordinated Debentures and the
Indentures may be made ("Place of Payment"); (vi) any period or periods within
which or date or dates on which, the price or prices at which and the terms
and conditions upon which Junior Subordinated Debentures may be redeemed, in
whole or in part, at the option of the Corporation or a holder thereof; (vii)
the obligation or the right, if any, of the Corporation or a holder thereof to
redeem, purchase or repay the Junior Subordinated Debentures and the period or
periods within which, the price or prices at which and the other terms and
conditions upon which the Junior Subordinated Debentures shall be redeemed,
repaid or purchased, in whole or in part, pursuant to such obligation; (viii)
the denominations in which any Junior Subordinated Debentures shall be
issuable; (ix) if other than in U.S. Dollars, the currency or currencies
(including currency unit or units) in which the principal of (and premium, if
any) and interest and Additional Interest, if any, on the Junior Subordinated
Debentures shall be payable, or in which the Junior Subordinated Debentures
shall be denominated; (x) any additions, modifications or deletions in the
events of default under the Indenture or covenants of the Corporation
specified in the Indenture with respect to the Junior Subordinated Debentures;
(xi) if other than the principal amount thereof, the portion of the principal
amount of Junior Subordinated Debentures that shall be payable upon
declaration or acceleration of the maturity thereof; (xii) any additions or
changes to the Indenture with respect to a series of Junior Subordinated
Debentures as shall be necessary to permit or facilitate the issuance of such
series in bearer form, registrable or not registrable as to principal, and
with or without interest coupons; (xiii) any index or indices used to
determine the amount of payments of principal of and premium, if any, on the
Junior Subordinated Debentures and the manner in which such amounts will be
determined; (xiv) the terms and conditions relating to the issuance of a
temporary Global Security representing all of the Junior Subordinated
Debentures of such series and the exchange of such temporary Global Security
for definitive Junior Subordinated Debentures of such series; (xv) subject to
the terms described herein under "--Global Junior Subordinated Debentures,"
whether the Junior Subordinated Debentures of the series shall be issued in
whole or part in the form of one or more Global Securities and, in such case,
the Depositary for such Global Securities, which Depositary shall be a
clearing agency registered under the Exchange Act; (xvi) the appointment of
any paying agent or agents; (xvii) the terms and conditions of any obligation
or right of the Corporation or a holder to convert or exchange the Junior
Subordinated Debentures into Capital Securities; (xviii) the form of Trust
Agreement, Guarantee Agreement and Expense Agreement, if applicable; (xix) the
relative degree, if any, to which such Junior Subordinated Debentures of the
series shall be senior to or be subordinated to other series of such Junior
Subordinated Debentures or other Indebtedness of the Corporation in right of
payment, whether such other series of Junior Subordinated Debentures or other
indebtedness are outstanding or not; and (xx) any other terms of the Junior
Subordinated Debentures not inconsistent with the provisions of the Indenture.
The Junior Subordinated Debentures may be sold at a substantial discount
below their stated principal amount, bearing no interest or interest at a rate
which at the time of issuance is below market rates. Certain United States
federal income tax consequences and special considerations applicable to
Junior Subordinated Debentures will be described in the applicable Prospectus
Supplement.
If the purchase price of any of the Junior Subordinated Debentures is
payable in one or more foreign currencies or currency units or if any Junior
Subordinated Debentures are denominated in one or more foreign currencies or
currency units or if the principal of, premium, if any, or interest, if any,
on
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any Junior Subordinated Debentures is payable in one or more foreign
currencies or currency units, the restrictions, elections, certain United
States federal income tax consequences, specific terms and other information
with respect to such series of Junior Subordinated Debentures and such foreign
currency or currency units will be set forth in the applicable Prospectus
Supplement.
If any index is used to determine the amount of payments of principal of,
premium, if any, or interest on any series of Junior Subordinated Debentures,
special United States federal income tax, accounting and other considerations
applicable thereto will be described in the applicable Prospectus Supplement.
REGISTRATION AND TRANSFER
Junior Subordinated Debentures of any series will be exchangeable for other
Junior Subordinated Debentures of the same issue and series, of any authorized
denominations, of a like aggregate principal amount, of the same original
issue date and stated maturity and bearing the same interest rate.
Junior Subordinated Debentures may be presented for exchange as provided
above, and may be presented for registration of transfer (with the form of
transfer endorsed thereon, or a satisfactory written instrument of transfer,
duly executed), at the office of the appropriate securities registrar or at
the office of any transfer agent designated by the Corporation for such
purpose with respect to any series of Junior Subordinated Debentures and
referred to in the applicable Prospectus Supplement without service charge and
upon payment of any taxes and other governmental charges as described in the
Indenture. The Corporation will appoint the Debenture Trustee as securities
registrar under the Indenture. The Corporation may at any time designate
additional transfer agents with respect to any series of Junior Subordinated
Debentures.
In the event of any redemption, neither the Corporation nor the Debenture
Trustee shall be required to (i) issue, register the transfer of or exchange
Junior Subordinated Debentures of any series during the period beginning at
the opening of business 15 days before the day of selection for redemption of
Junior Subordinated Debentures of that series and ending at the close of
business on the day of mailing of the relevant notice of redemption or (ii)
transfer or exchange any Junior Subordinated Debentures so selected for
redemption, except, in the case of any Junior Subordinated Debentures being
redeemed in part, any portion thereof not to be redeemed.
GLOBAL JUNIOR SUBORDINATED DEBENTURES
The Junior Subordinated Debentures of a series may be issued in whole or in
part in the form of one or more Global Junior Subordinated Debentures that
will be deposited with, or on behalf of, The Depository Trust Company ("DTC"),
as depositary. Global Junior Subordinated Debentures may be issued only in
fully registered form and in either temporary or permanent form. Unless and
until it is exchanged in whole or in part for the individual Junior
Subordinated Debentures represented thereby, a Global Junior Subordinated
Debenture may not be transferred except as a whole by DTC to a nominee of DTC
or by a nominee of DTC to DTC or another nominee of DTC or by DTC or any
nominee to a successor depositary or any nominee of such successor.
The specific terms of the depositary arrangement with respect to a series of
Junior Subordinated Debentures will be described in the Prospectus Supplement
relating to such series. The Corporation anticipates that the following
provisions will generally apply to depositary arrangements.
Upon the issuance of a Global Junior Subordinated Debenture, and the deposit
of such Global Junior Subordinated Debenture with or on behalf of DTC, DTC or
its nominee will credit, on its book-entry registration and transfer system,
the respective principal amounts of the individual Junior Subordinated
Debentures represented by such Global Junior Subordinated Debenture to the
accounts
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of persons that have accounts with DTC ("Participants"), including Morgan
Guaranty Trust Company of New York, Brussels Office, as operator of the
Euroclear System ("Euroclear") and Cedel Bank societe anonyme ("Cedel Bank").
Such accounts shall be designated by the dealers, underwriters or agents with
respect to such Junior Subordinated Debentures or by the Corporation if such
Junior Subordinated Debentures are offered and sold directly by the
Corporation. Ownership of beneficial interests in a Global Junior Subordinated
Debenture will be limited to Participants or persons that may hold interests
through Participants. Ownership of beneficial interests in a Global Junior
Subordinated Debenture will be shown on, and the transfer of that ownership
will be effected only through, records maintained by DTC or its nominee (with
respect to interests of Participants), and the records of Participants (with
respect to interests of persons who hold through Participants).
So long as DTC, or its nominee, is the registered owner of such Global
Junior Subordinated Debenture, DTC or such nominee, as the case may be, will
be considered the sole owner or holder of the Junior Subordinated Debentures
represented by such Global Junior Subordinated Debenture for all purposes
under the Indenture governing such Junior Subordinated Debentures. Except as
provided below, owners of beneficial interests in a Global Junior Subordinated
Debenture will not be entitled to have any of the individual Junior
Subordinated Debentures of the series represented by such Global Junior
Subordinated Debenture registered in their names, will not receive or be
entitled to receive physical delivery of any such Junior Subordinated
Debentures of such series in definitive form and will not be considered the
owners or holders thereof under the Indenture.
Payments of principal of (and premium, if any) and interest on individual
Junior Subordinated Debentures represented by a Global Junior Subordinated
Debenture registered in the name of DTC or its nominee will be made to DTC or
its nominee, as the case may be, as the registered owner of the Global Junior
Subordinated Debenture representing such Junior Subordinated Debentures. None
of the Corporation, the Debenture Trustee, any Paying Agent or the Securities
Registrar for such Junior Subordinated Debentures will have any responsibility
or liability for any aspect of the records relating to or payments made on
account of beneficial ownership interests of the Global Junior Subordinated
Debenture representing such Junior Subordinated Debentures or for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests.
The Corporation expects that DTC or its nominee, upon receipt of any payment
of principal, premium, if any, or interest in respect of a permanent Global
Junior Subordinated Debenture representing any of such Junior Subordinated
Debentures, immediately will credit Participants' accounts with payments in
amounts proportionate to their respective beneficial interest in the principal
amount of such Global Junior Subordinated Debenture for such Junior
Subordinated Debentures as shown on the records of DTC or its nominee. The
Corporation also expects that payments by Participants to owners of beneficial
interests in such Global Junior Subordinated Debenture held through such
Participants, including Euroclear and Cedel Bank, will be governed by standing
instructions and customary practices, as is now the case with securities held
for the accounts of customers in bearer form or registered in "street name."
Such payments will be the responsibility of such Participants.
Unless otherwise specified in the applicable Prospectus Supplement, if DTC
is at any time unwilling, unable or ineligible to continue as depositary and
the Corporation is unable to locate a qualified successor, the Corporation
will issue individual Junior Subordinated Debentures of such series in
exchange for the Global Junior Subordinated Debenture representing such series
of Junior Subordinated Debentures. In addition, the Corporation may at any
time and in its sole discretion determine not to have any Junior Subordinated
Debentures of such series represented by one or more Global Junior
Subordinated Debentures and, in such event, will issue certificated Junior
Subordinated Debentures of such series in exchange for the Global Junior
Subordinated Debenture or securities representing such series of Junior
Subordinated Debentures. Further, if the Corporation so specifies with respect
to the Junior Subordinated Debentures of a series , an owner of a beneficial
interest in a
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Global Junior Subordinated Debenture representing Junior Subordinated
Debentures of such series may, on terms acceptable to the Corporation and the
Debenture Trustee, receive certificated Junior Subordinated Debentures of such
series in exchange for such beneficial interests. In any such instance, an
owner of a beneficial interest in a Global Junior Subordinated Debenture will
be entitled to physical delivery of certificated Junior Subordinated Debentures
of the series represented by such Global Junior Subordinated Debenture equal in
principal amount to such beneficial interest and to have such Junior
Subordinated Debentures registered in its name. Individual Junior Subordinated
Debentures of such series so issued will be issued in denominations specified
in the Prospectus Supplement.
PAYMENT AND PAYING AGENTS
Unless otherwise indicated in the applicable Prospectus Supplement, payment
of principal of (and premium, if any) and any interest on Junior Subordinated
Debentures will be made at the office of the Debenture Trustee in the City of
New York or at the office of such paying agent or paying agents as the
Corporation may designate from time to time, except, at the option of the
Corporation, payment of any interest may be made (i) except in the case of
Global Junior Subordinated Debentures, by check mailed to the address of the
Person entitled thereto as such address shall appear in the securities register
or (ii) by transfer to an account maintained by the person entitled thereto as
specified in the securities register, provided that proper transfer
instructions have been received by the Regular Record Date. Unless otherwise
indicated in the applicable Prospectus Supplement, payment of any interest on
Junior Subordinated Debentures will be made to the person in whose name such
Junior Subordinated Debenture is registered at the close of business on the
Regular Record Date for such interest, except in the case of Defaulted
Interest. The Corporation may at any time designate additional Paying Agents or
rescind the designation of any paying agent; however, the Corporation will at
all times be required to maintain a paying agent in each place of payment for
each series of Junior Subordinated Debentures.
Any moneys deposited with the Debenture Trustee or any paying agent, or then
held by the Corporation in trust, for the payment of the principal of (and
premium, if any) or interest on any Junior Subordinated Debenture and remaining
unclaimed for two years after such principal (and premium, if any) or interest
has become due and payable shall, at the request of the Corporation, be repaid
to the Corporation and the holder of such Junior Subordinated Debenture shall
thereafter look, as a general unsecured creditor, only to the Corporation for
payment thereof.
OPTION TO DEFER INTEREST PAYMENTS
If provided in the applicable Prospectus Supplement, the Corporation will
have the right at any time and from time to time during the term of any series
of Junior Subordinated Debentures to defer payment of interest for up to such
number of consecutive interest payment periods as may be specified in the
applicable Prospectus Supplement (each, an "Extension Period"), subject to the
terms, conditions and covenants, if any, specified in such Prospectus
Supplement, provided that such Extension Period may not extend beyond the
Stated Maturity of such series of Junior Subordinated Debentures. Certain
United States federal income tax consequences and special considerations
applicable to any such Junior Subordinated Debentures will be described in the
applicable Prospectus Supplement.
REDEMPTION
Unless otherwise indicated in the applicable Prospectus Supplement, the
Junior Subordinated Debentures will not be subject to any sinking fund.
Unless otherwise indicated in the applicable Prospectus Supplement, the
Corporation may, at its option redeem the Junior Subordinated Debentures of any
series in whole at any time or in part from time to time on or after a date and
upon the satisfaction of such additional conditions as may be specified in the
applicable Prospectus Supplement. The applicable Prospectus Supplement will
also specify the minimum denominations of Junior Subordinated Debentures which
may be redeemed and the redemption price.
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Except as otherwise specified in the applicable Prospectus Supplement, if a
Tax Event (as defined below) in respect of a series of Junior Subordinated
Debentures or an Investment Company Event (as defined below) shall occur and
be continuing, the Corporation may, at its option, redeem such series of
Junior Subordinated Debentures in whole (but not in part) at any time within
90 days following the occurrence of such Tax Event or Investment Company
Event, at a redemption price specified in the applicable Prospectus
Supplement.
"Tax Event" means with respect to an Issuer of a series of Capital
Securities, the receipt by such Issuer of an opinion of 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 political subdivision or taxing
authority thereof or therein, or (b) any judicial decision or any official
administrative pronouncement (including any private letter ruling, technical
advice memorandum or field service advice) or regulatory procedure (an
"Administrative Action"), regardless of whether such judicial decision or
Administrative Action is issued to or in connection with a proceeding
involving the Corporation or such Issuer and whether or not subject to review
or appeal, which amendment, clarification, change, Administrative Action or
decision is enacted, promulgated or announced, in each case, on or after the
date of the applicable Prospectus Supplement, there is more than an
insubstantial risk that (i) such Issuer 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 such series Junior Subordinated Debentures,
(ii) interest payable by the Corporation on such series of Corresponding
Junior Subordinated Debentures is not, or within 90 days of such opinion, will
not be, deductible by the Corporation, in whole or in part, for United States
federal income tax purposes, or (iii) such Issuer is, or will be within 90
days of the date of the opinion, subject to more than a de minimis amount of
other taxes, duties or other governmental charges. See "Description of Capital
Securities--Redemption or Exchange--Possible Tax Law Changes".
"Investment Company Event" means the receipt by an Issuer of a series of
Capital Securities of an opinion of counsel to the Corporation experienced in
such matters to the effect that, as a result of the occurrence of a change in
law or regulation or a written change (including any announced prospective
change) in interpretation or application of law or regulation by any
legislative body, court, governmental agency or regulatory authority, there is
more than an insubstantial risk that such Issuer is or will be considered an
"investment company" that is required to be registered under the Investment
Company Act of 1940, as amended (the "Investment Company Act"), which change
or prospective change becomes effective or would become effective, as the case
may be, on or after the date of the issuance of such Capital Securities.
Notice of any redemption will be mailed at least 45 days but not more than
75 days before the redemption date to each Holder of Junior Subordinated
Debentures to be redeemed at its registered address. Unless the Corporation
defaults in payment of the redemption price, on and after the redemption date
interest shall cease to accrue on such Junior Subordinated Debentures or
portions thereof called for redemption.
RESTRICTIONS ON CERTAIN PAYMENTS
The Corporation will also covenant, as to each series of Junior Subordinated
Debentures, that it will not (i) declare or pay any dividends or distributions
on, or redeem, purchase, acquire, or make a liquidation payment with respect
to, any of the Corporation's capital stock or (ii) make any payment of
principal of or interest or premium, if any, on, or repay, repurchase or
redeem any debt securities of the Corporation (including other Junior
Subordinated Debentures) that rank pari passu in all respects with or junior
in interest to the Junior Subordinated Debentures (other than (a) repurchases,
redemptions or other acquisitions of shares of capital stock of the
Corporation in connection with any
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employment contract, benefit plan or other similar arrangement with or for the
benefit of one or more employees, officers, directors or consultants, in
connection with a dividend reinvestment or stockholder stock purchase plan or
in connection with the issuance of capital stock of the Corporation (or
securities convertible into or exercisable for such capital stock) as
consideration in an acquisition transaction entered into prior to the
applicable Extension Period, (b) as a result of any exchange or conversion of
any class or series of the Corporation's capital stock (or any capital stock
of a subsidiary of the Corporation) for any class or series of the
Corporation's capital stock or of any class or series of the Corporation's
indebtedness for any class or series of the Corporation's capital stock, (c)
the purchase of fractional interests in shares of the Corporation's capital
stock pursuant to the conversion or exchange provisions of such capital stock
or the security being converted or exchanged, (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 ranks pari
passu with or junior to such stock), if at such time (i) there shall have
occurred any event of which the Corporation has actual knowledge that (a) with
the giving of notice or the lapse of time, or both, would constitute an "Event
of Default" under the Indenture with respect to the Junior Subordinated
Debentures of such series and (b) in respect of which the Corporation shall
not have taken reasonable steps to cure, (ii) if such Junior Subordinated
Debentures are held by an Issuer of a series of Related Capital Securities,
the Corporation shall be in default with respect to its payment of any
obligations under the Guarantee relating to such related Capital Securities or
(iii) the Corporation shall have given notice of its selection of an Extension
Period as provided in the Indenture with respect to the Junior Subordinated
Debentures of such series and shall not have rescinded such notice, or such
Extension Period, or any extension thereof, shall be continuing.
MODIFICATION OF INDENTURE
From time to time the Corporation and the Debenture Trustee may, without the
consent of the holders of any series of Junior Subordinated Debentures, amend,
waive or supplement the Indenture for specified purposes, including, among
other things, curing ambiguities, defects or inconsistencies (provided that
any such action does not materially adversely affect the interest of the
holders of any series of Junior Subordinated Debentures or, in the case of
Corresponding Junior Subordinated Debentures, the holders of Related Capital
Securities so long as they remain outstanding) and qualifying, or maintaining
the qualification of, the Indenture under the Trust Indenture Act. The
Indenture contains provisions permitting the Corporation and the Debenture
Trustee, with the consent of the holders of not less than a majority in
principal amount of each outstanding series of Junior Subordinated Debentures
affected, to modify the Indenture in a manner affecting adversely the rights
of the holders of such series of Junior Subordinated Debentures in any
material respect, provided that no such modification may, without the consent
of the holder of each outstanding Junior Subordinated Debenture so affected,
(i) change the Stated Maturity of any series of Junior Subordinated Debentures
(except as otherwise specified in the applicable Prospectus Supplement),
reduce the principal amount thereof, or reduce the rate or extend the time of
payment of interest thereon or (ii) reduce the percentage of principal amount
of Junior Subordinated Debentures of any series, the holders of which are
required to consent to any such modification of the Indenture. Furthermore, in
the case of Corresponding Junior Subordinated Debentures, so long as any of
the Related 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 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 all outstanding Related
Capital Securities affected unless and until the principal of the
Corresponding Junior Subordinated Debentures and all accrued and unpaid
interest thereon have been paid in full and certain other conditions have been
satisfied.
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In addition, the Corporation and the Debenture Trustee may execute, without
the consent of any holder of Junior Subordinated Debentures, any supplemental
Indenture for the purpose of creating any new series of Junior Subordinated
Debentures.
DEBENTURE EVENTS OF DEFAULT
The Indenture provides that any one or more of the following described
events with respect to a series of Junior Subordinated Debentures that has
occurred and is continuing constitutes a "Debenture Event of Default" with
respect to such series of Junior Subordinated Debentures:
(i) failure for 30 days to pay any interest on such series of Junior
Subordinated Debentures, including any Additional Interest in respect
thereof, when due (subject to the deferral of any interest payment in the
case of an Extension Period); or
(ii) failure to pay any principal or premium, if any, on such series of
Junior Subordinated Debentures when due whether at maturity or upon
redemption; or
(iii) failure to observe or perform any other covenants contained in the
Indenture for 90 days after written notice to the Corporation from the
Debenture Trustee or the holders of at least 25% in aggregate outstanding
principal amount of such affected series of Junior Subordinated Debentures;
or
(iv) certain events in bankruptcy, insolvency or reorganization of the
Corporation.
The holders of a majority in aggregate outstanding principal amount of
Junior Subordinated Debentures of each series affected have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Debenture Trustee. The Debenture Trustee or the holders of
not less than 25% in aggregate outstanding principal amount of the Junior
Subordinated Debentures of each series affected may declare the principal due
and payable immediately upon a Debenture Event of Default, and, in the case of
Corresponding Junior Subordinated Debentures, should the Debenture Trustee or
such holders of such Corresponding Junior Subordinated Debentures fail to make
such declaration, the holders of at least 25% in aggregate Liquidation Amount
of the outstanding Related Capital Securities shall have such right. The
holders of a majority in aggregate outstanding principal amount of the Junior
Subordinated Debentures of each series affected may annul such declaration. In
the case of Corresponding Junior Subordinated Debentures, should the holders
of such Corresponding Junior Subordinated Debentures fail to annul such
declaration and waive such default, the holders of a majority in aggregate
Liquidation Amount of the outstanding Related Capital Securities shall have
such right.
The holders of a majority in aggregate outstanding principal amount of each
series of outstanding Junior Subordinated Debentures affected thereby may, on
behalf of the holders of all the Junior Subordinated Debentures of such
series, waive any default, except a default in the payment of principal (or
premium if any) or interest (including any Additional 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 Debenture Trustee) or a default in respect of a covenant or provision
which under the Indenture cannot be modified or amended without the consent of
the holder of each outstanding Junior Subordinated Debenture of such series.
In the case of Corresponding Junior Subordinated Debentures, should the
holders of such Corresponding Junior Subordinated Debentures fail to waive
such default, the holders of a majority in aggregate Liquidation Amount of the
outstanding Related Capital Securities shall have such right. The Corporation
is required to file annually with the Debenture Trustee a certificate as to
whether or not the Corporation is in compliance with all the conditions and
covenants applicable to it under the Indenture.
In case a Debenture Event of Default shall occur and be continuing as to a
series of Corresponding Junior Subordinated Debentures, the Property Trustee
will have the right to declare the
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principal of and the interest on such Corresponding Junior Subordinated
Debentures, and any other amounts payable under the Indenture, to be forthwith
due and payable and to enforce its other rights as a creditor with respect to
such Corresponding Junior Subordinated Debentures.
ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF CAPITAL SECURITIES
If a Debenture Event of Default with respect to a series of Corresponding
Junior Subordinated Debentures has occurred and is continuing and such event
is attributable to the failure of the Corporation to pay any interest or
principal on such Corresponding Junior Subordinated Debentures on the date
interest or principal is due and payable, a holder of Related Capital
Securities may institute a legal proceeding directly against the Corporation
for enforcement of payment to such holder of the principal of or interest
(including any Additional Interest) on such Corresponding Junior Subordinated
Debentures having a principal amount equal to the aggregate Liquidation Amount
of the Related Capital Securities of such holder (a "Direct Action"). The
Corporation may not amend the Indenture to remove the foregoing right to bring
a Direct Action without the prior written consent of the holders of all of the
Capital Securities outstanding. If the right to bring a Direct Action is
removed, the Issuer may become subject to the reporting obligations under the
Exchange Act. The Corporation shall have the right under the Indenture to set-
off any payment made to such holder of Capital Securities by the Corporation
in connection with a Direct Action.
The holders of the Capital Securities will not be able to exercise directly
any remedies other than those set forth in the preceding paragraph available
to the holders of the Junior Subordinated Debentures unless there shall have
been an event of default under the Trust Agreement. See "Description of
Capital Securities--Events of Default; Notice".
CONSOLIDATION, MERGER, SALE OF ASSETS AND OTHER TRANSACTIONS
The Indenture provides that the Corporation shall not consolidate with or
merge into any other Person or convey, transfer or lease its properties and
assets substantially as an entirety to any Person, and that no Person shall
consolidate with or merge into the Corporation or convey, transfer or lease
its properties and assets substantially as an entirety to the Corporation,
unless (i) in case the Corporation consolidates with or merges into another
Person or conveys or transfers its properties and assets substantially as an
entirety to any Person, the successor Person is organized under the laws of
the United States or any state or the District of Columbia, and such successor
Person expressly assumes the Corporation's obligations on the Junior
Subordinated Debentures issued under the Indenture; (ii) immediately after
giving effect thereto, no Debenture Event of Default, and no event which,
after notice or lapse of time or both, would become a Debenture Event of
Default, shall have occurred and be continuing; and (iii) certain other
conditions as prescribed by the Indenture are met.
The general provisions of the Indenture do not afford holders of the Junior
Subordinated Debentures protection in the event of a highly leveraged or other
transaction involving the Corporation that may adversely affect holders of the
Junior Subordinated Debentures.
SATISFACTION AND DISCHARGE
The Indenture provides that when, among other things, all Junior
Subordinated Debentures not previously delivered to the Debenture Trustee for
cancellation (i) have become due and payable or (ii) will become due and
payable at their Stated Maturity within one year, and the Corporation deposits
or causes to be deposited with the Debenture Trustee funds, in trust, for the
purpose and in an amount in the currency or currencies in which the Junior
Subordinated Debentures are payable sufficient to pay and discharge the entire
indebtedness on the Junior Subordinated Debentures not previously delivered to
the Debenture Trustee for cancellation, for the principal (and premium, if
any) and interest (including any Additional Interest) to the date of the
deposit or to the Stated Maturity, as the case may
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be, then the Indenture will cease to be of further effect (except as to the
Corporation's obligations to pay all other sums due pursuant to the Indenture
and to provide the officers' certificates and opinions of counsel described
therein), and the Corporation will be deemed to have satisfied and discharged
the Indenture.
SUBORDINATION
The Junior Subordinated Debentures will be subordinate in right of payment,
to the extent set forth in the Indenture, to all Senior Debt (as defined
below) of the Corporation. If the Corporation defaults in the payment of any
principal, premium, if any, or interest, if any, or any other amount payable
on any Senior Debt when the same becomes due and payable, whether at maturity
or at a date fixed for redemption or by declaration of acceleration or
otherwise, then, unless and until such default has been cured or waived or has
ceased to exist or all Senior Debt has been paid, no direct or indirect
payment (in cash, property, securities, by set-off or otherwise) may be made
or agreed to be made on the Junior Subordinated Debentures, or in respect of
any redemption, repayment, retirement, purchase or other acquisition of the
Junior Subordinated Debentures.
As used herein, "Senior Debt" means any obligation of the Corporation to its
creditors, whether now outstanding or subsequently incurred, other than any
obligation as to which, in the instrument creating or evidencing the
obligation or pursuant to which the obligation is outstanding, it is provided
that such obligation is not Senior Debt, but does not include trade accounts
payable and accrued liabilities arising in the ordinary course of business.
Senior Debt includes any subordinated debt securities issued in the future
with substantially similar subordination terms, but does not include the
Junior Subordinated Debentures of any series or any junior subordinated debt
securities issued in the future with subordination terms substantially similar
to those of the Junior Subordinated Debentures. Substantially all of the
existing indebtedness of the Corporation constitutes Senior Debt.
In the event of (i) any insolvency, bankruptcy, receivership, liquidation,
reorganization, readjustment, composition or other similar proceeding relating
to the Corporation, its creditors or its property, (ii) any proceeding for the
liquidation, dissolution or other winding up of the Corporation, voluntary or
involuntary, whether or not involving insolvency or bankruptcy proceedings,
(iii) any assignment by the Corporation for the benefit of creditors or (iv)
any other marshalling of the assets of the Corporation, all Senior Debt
(including any interest thereon accruing after the commencement of any such
proceedings) shall first be paid in full before any payment or distribution,
whether in cash, securities or other property, shall be made on account of the
Junior Subordinated Debentures. In such event, any payment or distribution on
account of the Junior Subordinated Debentures, whether in cash, securities or
other property, that would otherwise (but for the subordination provisions) be
payable or deliverable in respect of the Junior Subordinated Debentures will
be paid or delivered directly to the holders of Senior Debt in accordance with
the priorities then existing among such holders until all Senior Debt
(including any interest thereon accruing after the commencement of any such
proceedings) has been paid in full.
In the event of any such proceeding, after payment in full of all sums owing
with respect to Senior Debt, the holders of Junior Subordinated Debentures,
together with the holders of any obligations of the Corporation ranking on a
parity with the Junior Subordinated Debentures, will be entitled to be paid
from the remaining assets of the Corporation the amounts at the time due and
owing on the Junior Subordinated Debentures and such other obligations before
any payment or other distribution, whether in cash, property or otherwise,
will be made on account of any capital stock or obligations of the Corporation
ranking junior to the Junior Subordinated Debentures. If any payment or
distribution on account of the Junior Subordinated Debentures of any character
or any security, whether in cash, securities or other property is received by
any holder of any Junior Subordinated Debentures in contravention of any of
the terms hereof and before all the Senior Debt has been paid in full, such
payment or distribution or security will be received in trust for the benefit
of, and must be paid over or
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delivered and transferred to, the holders of the Senior Debt at the time
outstanding in accordance with the priorities then existing among such holders
for application to the payment of all Senior Debt remaining unpaid to the
extent necessary to pay all such Senior Debt in full. By reason of such
subordination, in the event of the insolvency of the Corporation, holders of
Senior Debt may receive more, ratably, and holders of the Junior Subordinated
Debentures may receive less, ratably, than the other creditors of the
Corporation. Such subordination will not prevent the occurrence of any Event
of Default under the Indenture.
The Junior Subordinated Indenture places no limitation on the amount of
additional Senior Debt that may be incurred by the Corporation. The
Corporation expects from time to time to incur additional indebtedness
constituting Senior Debt.
TRUST EXPENSES
Pursuant to the Expense Agreement for each series of Corresponding Junior
Subordinated Debentures the Corporation will irrevocably and unconditionally
agree with any Issuer that holds such Junior Subordinated Debentures that the
Corporation will pay to such Issuer, and reimburse such Issuer for, the full
amounts of any costs, expenses or liabilities of such Issuer, other than
obligations of such Issuer to pay to the holders of any Capital Securities or
other similar interests in such Issuer the amounts due such holders pursuant
to the terms of the Capital Securities or such other similar interests, as the
case may be. Such payment obligation will include any such costs, expenses or
liabilities of each Issuer that are required by applicable law to be satisfied
in connection with a termination of such Issuer.
GOVERNING LAW
The Indenture and the Junior Subordinated Debentures will be governed by and
construed in accordance with the laws of the State of New York.
INFORMATION CONCERNING THE DEBENTURE TRUSTEE
The Debenture Trustee shall have and be subject to all the duties and
responsibilities specified with respect to an indenture trustee under the
Trust Indenture Act. Subject to such provisions, the Debenture Trustee is
under no obligation to exercise any of the powers vested in it by the
Indenture at the request of any holder of Junior Subordinated Debentures,
unless offered reasonable indemnity by such holder against the costs, expenses
and liabilities which might be incurred thereby. The Debenture Trustee is not
required to expend or risk its own funds or otherwise incur personal financial
liability in the performance of its duties if the Debenture Trustee reasonably
believes that repayment or adequate indemnity is not reasonably assured to it.
CORRESPONDING JUNIOR SUBORDINATED DEBENTURES
The Corresponding Junior Subordinated Debentures may be issued in one or
more series of Junior Subordinated Debentures under the Indenture with terms
corresponding to the terms of a series of Related Capital Securities. In that
event, concurrently with the issuance of each Issuer's Capital Securities,
such Issuer will invest the proceeds thereof and the consideration paid by the
Corporation for the Common Securities of such Issuer in such series of
Corresponding Junior Subordinated Debentures issued by the Corporation to such
Issuer. Each series of Corresponding Junior Subordinated Debentures will be in
the principal amount equal to the aggregate stated Liquidation Amount of the
Related Capital Securities and the Common Securities of such Issuer and will
rank pari passu with all other series of Junior Subordinated Debentures.
Holders of the Related Capital Securities for a series of Corresponding Junior
Subordinated Debentures will have the rights in connection with modifications
to the Indenture or upon occurrence of Debenture Events of Default, as
described under "--Modification of Indenture" and "--Debenture Events of
Default", unless provided otherwise in the Prospectus Supplement for such
Related Capital Securities.
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Unless otherwise specified in the applicable Prospectus Supplement, if a Tax
Event or Investment Company Event in respect of an Issuer shall occur and be
continuing, the Corporation may, at its option, redeem the Corresponding
Junior Subordinated Debentures at any time within 90 days of the occurrence of
such Tax Event, or Investment Company Event, in whole but not in part, subject
to the provisions of the Indenture and whether or not such Corresponding
Junior Subordinated Debentures are then otherwise redeemable at the option of
the Corporation at a redemption price specified in the applicable Prospectus
Supplement. For so long as the applicable Issuer is the holder of all the
outstanding Corresponding Junior Subordinated Debentures of such Issuer, the
proceeds of any such redemption will be used by the Issuer to redeem the
corresponding Trust Securities in accordance with their terms. The Corporation
may not redeem a series of Corresponding Junior Subordinated Debentures in
part unless all accrued and unpaid interest has been paid in full on all
outstanding Corresponding Junior Subordinated Debentures of such series for
all interest periods terminating on or prior to the Redemption Date.
The Corporation will covenant in the Indenture, as to each series of
Corresponding Junior Subordinated Debentures, that if and so long as (i) the
Issuer of the related series of Trust Securities is the holder of all such
Corresponding Junior Subordinated Debentures, (ii) a Tax Event described in
clause (i) or (iii) of the definition of Tax Event has occurred and is
continuing in respect of such Issuer and (iii) the Corporation has elected,
and has not revoked such election, to pay Additional Sums (as defined under
"Description of Capital Securities--Redemption or Exchange") in respect of
such Trust Securities, the Corporation will pay to such Issuer such Additional
Sums. The Corporation will also covenant, as to each series of Corresponding
Junior Subordinated Debentures, (i) to maintain directly or indirectly 100%
ownership of the Common Securities of the Issuer to which such Corresponding
Junior Subordinated Debentures have been issued, provided that certain
successors which are permitted pursuant to the Indenture may succeed to the
Corporation's ownership of the Common Securities, (ii) not to voluntarily
terminate, wind-up or liquidate any Issuer, except (a) in connection with a
distribution of Corresponding Junior Subordinated Debentures to the holders of
the Capital Securities in exchange therefor upon liquidation of such Issuer or
(b) in connection with certain mergers, consolidations or amalgamations
permitted by the related Trust Agreement, and (iii) to use its reasonable
efforts, consistent with the terms and provisions of the related Trust
Agreement, to cause such Issuer not to be taxable as a corporation for United
States federal income tax purposes.
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DESCRIPTION OF CAPITAL SECURITIES
Pursuant to the terms of the Trust Agreement for each Issuer, the Property
Trustee on behalf of such Issuer will issue the Capital Securities and the
Common Securities. The Capital Securities of a particular Issuer will
represent preferred beneficial interests in the Issuer and the holders thereof
will be entitled to a preference in certain circumstances with respect to
Distributions and amounts payable on redemption or liquidation over the Common
Securities of such Issuer, as well as other benefits as described in the
corresponding Trust Agreement. This summary of certain provisions of the
Capital Securities and each Trust Agreement, which summarizes the material
terms thereof, does not purport to be complete and is subject to, and is
qualified in its entirety by reference to, all the provisions of each Trust
Agreement, including the definitions therein of certain terms, and the Trust
Indenture Act, to which reference is hereby made. Wherever particular defined
terms of a Trust Agreement (as amended or supplemented from time to time) are
referred to herein or in a Prospectus Supplement, such defined terms are
incorporated herein or therein by reference. The form of the Trust Agreement
has been filed as an exhibit to the Registration Statement of which this
Prospectus forms a part. Each of the Issuers is a legally separate entity and
the assets of one are not available to satisfy the obligations of the other.
GENERAL
The Capital Securities of an Issuer will rank pari passu, and payments will
be made thereon pro rata, with the Common Securities of that Issuer except as
described under "--Subordination of Common Securities". Legal title to the
Corresponding Junior Subordinated Debentures will be held by the Property
Trustee in trust for the benefit of the holders of the related Capital
Securities and Common Securities. Each Guarantee Agreement executed by the
Corporation for the benefit of the holders of an Issuer's Capital Securities
(the "Guarantee" for such Capital Securities) will be a guarantee on a
subordinated basis with respect to the related Capital Securities but will not
guarantee payment of Distributions or amounts payable on redemption or
liquidation of such Capital Securities when the related Issuer does not have
funds on hand available to make such payments. See "Description of
Guarantees".
DISTRIBUTIONS
Distributions on the Capital Securities will be cumulative, will accumulate
from the date of original issuance and will be payable on such dates as
specified in the applicable Prospectus Supplement. In the event that any date
on which Distributions are payable on the Capital Securities is not a Business
Day (as defined below), payment of the Distribution 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 to any such delay) except that, if such
Business Day is in the next succeeding calendar year, payment of such
Distribution shall be made on the immediately preceding Business Day, in
either case with the same force and effect as if made on such date (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 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
Debenture Trustee is closed for business.
Each Issuer's Capital Securities represent preferred beneficial interests in
the applicable Issuer, and the Distributions on each Capital Security will be
payable at a rate specified in the applicable Prospectus Supplement for such
Capital Securities. The amount of Distributions payable for any period will be
computed on the basis of a 360-day year of twelve 30-day months unless
otherwise specified in the applicable Prospectus Supplement. Distributions to
which holders of Capital Securities are entitled will accumulate additional
Distributions at the rate per annum if and as specified in the applicable
Prospectus Supplement. The term "Distributions" as used herein includes any
such additional Distributions unless otherwise stated.
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If provided in the applicable Prospectus Supplement, the Corporation has the
right under the Indenture pursuant to which it will issue the Corresponding
Junior Scheduled Debentures, to defer the payment of interest at any time or
from time to time on any series of the Corresponding Junior Subordinated
Debentures for up to such number of consecutive interest payment periods which
will be specified in the applicable Prospectus Supplement (each, an "Extension
Period"), provided that no Extension Period may extend beyond the Stated
Maturity of the Corresponding Junior Subordinated Debentures. As a consequence
of any such deferral, Distributions on the Related Capital Securities would be
deferred (but would continue to accumulate additional Distributions thereon at
the rate set forth in the applicable Prospectus Supplement) by the Issuer of
such Capital Securities during any such Extension Period. During any such
Extension Period, the Corporation may not (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire or make a liquidation payment
with respect to, any of the Corporation's capital stock or (ii) make any
payment of principal of or interest or premium, if any, on or repay,
repurchase or redeem any debt securities of the Corporation that rank pari
passu in all respects with or junior in interest to the Corresponding Junior
Subordinated Debentures (other than (a) repurchases, redemptions or other
acquisitions of shares of capital stock of the Corporation in connection with
any employment contract, benefit plan or other similar arrangement with or for
the benefit of one or more employees, officers, directors or consultants, in
connection with a dividend reinvestment or stockholder stock purchase plan or
in connection with the issuance of capital stock of the Corporation (or
securities convertible into or exercisable for such capital stock) as
consideration in an acquisition transaction entered into prior to the
applicable Extension Period, (b) as a result of any exchange or conversion of
any class or series of the Corporation's capital stock (or any capital stock
of a subsidiary of the Corporation) for any class or series of the
Corporation's capital stock or of any class or series of the Corporation's
indebtedness for any class or series of the Corporation's capital stock, (c)
the purchase of fractional interests in shares of the Corporation's capital
stock pursuant to the conversion or exchange provisions of such capital stock
or the security being converted or exchanged, (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 ranks pari
passu with or junior to such stock).
The revenue of each Issuer available for distribution to holders of its
Capital Securities will be limited to payments under the Corresponding Junior
Subordinated Debentures in which the Issuer will invest the proceeds from the
issuance and sale of the Trust Securities. See "Description of Junior
Subordinated Debentures--Corresponding Junior Subordinated Debentures." If the
Corporation does not make interest payments on such Corresponding Junior
Subordinated Debentures, the Property Trustee will not have funds available to
pay Distributions on the Related Capital Securities. The payment of
Distributions (if and to the extent the Issuer has funds legally available for
the payment of such Distributions and cash sufficient to make such payments)
is guaranteed by the Corporation on a limited basis as set forth herein under
"Description of Guarantees."
Distributions on the Capital Securities will be payable to the holders
thereof as they appear on the register of such Issuer on the relevant record
date, which, as long as the Capital Securities remain in book-entry form, will
be one Business Day prior to the relevant Distribution Date. Subject to any
applicable laws and regulations and the provisions of the applicable Trust
Agreement, each such payment will be made as described under "Book-Entry
Issuance." In the event any Capital Securities are not in book-entry form, the
relevant record date for such Capital Securities shall be the date at least 15
days prior to the relevant Distribution Date, as specified in the applicable
Prospectus Supplement.
REDEMPTION OR EXCHANGE
Mandatory Redemption. Upon the repayment or redemption, in whole or in part,
of any Corresponding Junior Subordinated Debentures, whether at maturity or
upon earlier redemption as
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provided in the Indenture, the proceeds from such repayment or redemption
shall be applied by the Property Trustee to redeem a Like Amount (as defined
below) of the Trust Securities, upon not less than 30 nor more than 60 days
notice, at a redemption price (the "Redemption Price") specified in the
applicable Prospectus Supplement. If less than all of any series of
Corresponding Junior Subordinated Debentures are to be repaid or redeemed on a
Redemption Date, then the proceeds from such repayment or redemption shall be
allocated to the redemption pro rata of the Related Capital Securities and the
Common Securities. The amount of premium, if any, paid by the Corporation upon
the redemption of all or any part of any series of any Corresponding Junior
Subordinated Debentures to be repaid or redeemed on a Redemption Date shall be
allocated to the redemption pro rata of the Related Capital Securities and the
Common Securities.
The Corporation will have the right to redeem any series of Corresponding
Junior Subordinated Debentures (i) on or after such date as may be specified
in the applicable Prospectus Supplement, in whole at any time or in part from
time to time, (ii) at any time, in whole (but not in part), upon the
occurrence of a Tax Event or Investment Company Event or (iii) as may be
otherwise specified in the applicable Prospectus Supplement.
Distribution of Corresponding Junior Subordinated Debentures. The
Corporation has the right at any time to terminate any Issuer and, after
satisfaction of the liabilities of creditors of such Issuer as provided by
applicable law, cause such Corresponding Junior Subordinated Debentures in
respect of the Related Capital Securities and Common Securities issued by such
Issuer to be distributed to the holders of such Capital Securities and Common
Securities in liquidation of the Issuer.
Tax Event or Investment Company Event Redemption. If a Tax Event or
Investment Company Event in respect of a series of Capital Securities and
Common Securities shall occur and be continuing, the Corporation has the right
to redeem the Corresponding Junior Subordinated Debentures in whole (but not
in part) and thereby cause a mandatory redemption of such Capital Securities
and Common Securities in whole (but not in part) at the Redemption Price
within 90 days following the occurrence of such Tax Event or Investment
Company Event. In the event a Tax Event or Investment Company Event in respect
of the Capital Securities and Common Securities has occurred and is continuing
and the Corporation does not elect to redeem the Corresponding Junior
Subordinated Debentures and thereby cause a mandatory redemption of such
Capital Securities or to liquidate the related Issuer and cause the
Corresponding Junior Subordinated Debentures to be distributed to the holders
of such Capital Securities and Common Securities in exchange therefor upon
liquidation of the Issuer as described above, such Capital Securities will
remain outstanding and, as specified in the applicable Prospectus Supplement,
Additional Sums (as defined below) may be payable on the Corresponding Junior
Subordinated Debentures.
"Additional Sums" means the additional amounts as may be necessary in order
that the amount of Distributions then due and payable by an Issuer on the
outstanding Capital Securities and Common Securities of the Issuer shall not
be reduced as a result of certain additional taxes, duties and other
governmental charges to which the Issuer has become subject as a result of a
Tax Event.
"Like Amount" means (i) with respect to a redemption of any series of Trust
Securities, the Trust Securities of such series having a Liquidation Amount
(as defined below) equal to the principal amount of Corresponding Junior
Subordinated Debentures to be contemporaneously redeemed in accordance with
the Indenture, the proceeds of which will be used to pay the Redemption Price
of such Trust Securities, and (ii) with respect to a distribution of
Corresponding Junior Subordinated Debentures to holders of any series of Trust
Securities in connection with a dissolution or liquidation of the related
Issuer, Corresponding Junior Subordinated Debentures having a principal amount
equal to the Liquidation Amount of the Trust Securities in respect of which
such distribution is made.
"Liquidation Amount" means the stated amount per Trust Security specified in
the applicable Prospectus Supplement.
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"Tax Event" means, with respect to an Issuer of a series of Capital
Securities, the receipt by such Issuer of an opinion of 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 political subdivision or taxing
authority thereof or therein, or (b) any judicial decision or any official
administrative pronouncement (including any private letter ruling, technical
advice memorandum or field service advice) or regulatory procedure (an
"Administrative Action"), regardless of whether such judicial decision or
Administrative Action is issued to or in connection with a proceeding
involving the Corporation or such Issuer and whether or not subject to review
or appeal, which amendment, clarification, change, Administrative Action or
decision is enacted, promulgated or announced, in each case, on or after the
date of the applicable Prospectus Supplement, there is more than an
insubstantial risk that (i) such Issuer 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 such series of Corresponding Junior
Subordinated Debentures, (ii) interest payable by the Corporation on such
series of Corresponding Junior Subordinated Debentures is not, or within 90
days of such opinion, will not be, deductible by the Corporation, in whole or
in part, for United States federal income tax purposes, or (iii) such Issuer
is, or will be within 90 days of the date of the opinion, subject to more than
a de minimis amount of other taxes, duties or other governmental charges.
Possible Tax Law Changes. Prospective investors should be aware that Enron
Corporation has filed a petition in Tax Court challenging the proposed
disallowance by the Internal Revenue Service of the deduction of interest
expense on securities issued by Enron Corporation in 1993 and 1994 that are
similar to, although different in a number of respects from, the Junior
Subordinated Debentures. It is possible that a decision in that case could
give rise to a Tax Event, which would permit the Corporation to cause a
redemption of Capital Securities. Prospective investors also should be aware
that legislation has been proposed by the Clinton Administration in the past
that, if enacted, would have denied an interest expense deduction to issuers
of instruments such as the Junior Subordinated Debentures. No such legislation
is currently pending. There can be no assurance, however, that similar
legislation will not ultimately be enacted into law, or that other
developments will not occur on or after the date hereof that would adversely
affect the tax treatment of the Junior Subordinated Debentures. Such changes
also could give rise to a Tax Event.
"Investment Company Event" means, with respect to an Issuer, the receipt by
such Issuer of a series of Capital Securities of an opinion of counsel to the
Corporation experienced in such matters to the effect that, as a result of the
occurrence of a change in law or regulation or a written change (including any
announced prospective change) in interpretation or application of law or
regulation by any legislative body, court, governmental agency or regulatory
authority, there is more than an insubstantial risk that such Issuer is or
will be considered an "investment company" that is required to be registered
under the Investment Company Act, which change or prospective change becomes
effective or would become effective, as the case may be, on or after the date
of the issuance of such Capital Securities.
After the liquidation date fixed for any distribution of Corresponding
Junior Subordinated Debentures for any series of Capital Securities (i) such
series of Capital Securities will no longer be deemed to be outstanding, (ii)
the depositary or its nominee, as the record holder of such series of Capital
Securities, will receive a registered global certificate or certificates
representing the Corresponding Junior Subordinated Debentures to be delivered
upon such distribution and (iii) any certificates representing such series of
Capital Securities not held by DTC or its nominee will be deemed to represent
the Corresponding Junior Subordinated Debentures having a principal amount
equal to the stated Liquidation Amount of such series of Capital Securities,
and bearing accrued and unpaid interest in an amount equal to the accrued and
unpaid Distributions on such series of Capital Securities until such
certificates are presented to the agent for transfer or reissuance.
There can be no assurance as to the market prices for the Capital Securities
or the Corresponding Junior Subordinated Debentures that may be distributed in
exchange for Capital Securities if a
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dissolution and liquidation of an Issuer were to occur. Accordingly, the
Capital Securities that an investor may purchase, or the Corresponding Junior
Subordinated Debentures that the investor may receive on dissolution and
liquidation of an Issuer, may trade at a discount to the price that the
investor paid to purchase the Capital Securities offered hereby.
REDEMPTION PROCEDURES
Capital Securities redeemed on each Redemption Date shall be redeemed at the
Redemption Price with the applicable proceeds from the contemporaneous
redemption of the Corresponding Junior Subordinated Debentures. Redemptions of
the Capital Securities shall be made and the Redemption Price shall be payable
on each Redemption Date only to the extent that the related Issuer has funds
on hand available for the payment of such Redemption Price. See also "--
Subordination of Common Securities".
If an Issuer gives a notice of redemption in respect of its 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 funds sufficient to pay the applicable Redemption Price
and will give DTC irrevocable instructions and authority to pay the Redemption
Price to the holders of such Capital Securities. See "Book-Entry Issuance". If
such Capital Securities are no longer in book-entry form, the Property
Trustee, 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 such paying agent irrevocable
instructions and authority to pay the Redemption Price to the holders thereof
upon surrender of their certificates evidencing such Capital Securities.
Notwithstanding the foregoing, Distributions payable on or prior to the
Redemption Date for any Capital Securities called for redemption shall be
payable to the holders of such Capital Securities on the relevant record dates
for the related Distribution Dates. If notice of redemption shall have been
given and funds deposited as required, then upon the date of such deposit, all
rights of the holders of such Capital Securities so called for redemption will
cease, except the right of the holders of such Capital Securities to receive
the Redemption Price and any Distribution payable in respect of the Capital
Securities on or prior to the Redemption Date, 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 such date. 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 Issuer or by the Corporation
pursuant to the Guarantee as described under "Description of Guarantees",
Distributions on such Capital Securities will continue to accrue at the then
applicable rate from the Redemption Date originally established by the Issuer
for such 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 laws), the Corporation or its subsidiaries may at any time
and from time to time purchase outstanding Capital Securities by tender, in
the open market or by private agreement.
Payment of the Redemption Price on the Capital Securities and any
distribution of Corresponding Junior Subordinated Debentures to holders of
Capital Securities shall be made to the applicable recordholders thereof as
they appear on the register for such Capital Securities on the relevant record
date, which shall be one Business Day prior to the relevant Redemption Date or
liquidation date, as applicable; provided, however, that in the event that any
Capital Securities are not in book-entry form,
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the relevant record date for such Capital Securities shall be a date at least
15 days prior to the Redemption Date or liquidation date, as applicable, as
specified in the Prospectus Supplement.
If less than all of the Capital Securities and Common Securities issued by
an Issuer are to be redeemed on a Redemption Date, then the aggregate
Liquidation Amount of such Capital Securities and Common Securities to be
redeemed shall be allocated pro rata to the Capital Securities and the Common
Securities based upon the relative Liquidation Amounts of such classes. 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
of the Liquidation Amount of Capital Securities as specified in the applicable
Prospectus Supplement. The Property Trustee shall promptly notify the
securities registrar in writing of the Capital Securities selected for
redemption and, in the case of any Capital Securities selected for partial
redemption, the Liquidation Amount thereof to be redeemed. For all purposes of
each Trust Agreement, unless the context otherwise requires, all provisions
relating to the redemption of Capital Securities shall relate, in the case of
any Capital Securities 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.
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 Trust Securities to be
redeemed at its registered address. Unless the Corporation defaults in payment
of the Redemption Price on the Corresponding Junior Subordinated Debentures,
on and after the Redemption Date interest will cease to accrue on such Junior
Subordinated Debentures or portions thereof (and Distributions will cease to
accrue on the Related Capital Securities or portions thereof) called for
redemption.
SUBORDINATION OF COMMON SECURITIES
Payment of Distributions on, and the Redemption Price of, each Issuer's
Capital Securities and 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, Redemption
Date or Liquidation Date a Debenture Event of Default shall have occurred and
be continuing, no payment of any Distribution on, or Redemption Price of, or
Liquidation Distribution in respect of, any of the Issuer's 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 Issuer's
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 Issuer's outstanding Capital
Securities then called for redemption, or in the case of payment of the
Liquidation Distribution the full amount of such Liquidation Distribution on
all outstanding Capital Securities, 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
Issuer's Capital Securities then due and payable.
In the case of any event of default under the applicable Trust Agreement
resulting from a Debenture Event of Default, the Corporation as holder of such
Issuer's Common Securities will be deemed to have waived any right to act with
respect to any such Event of Default under the applicable Trust Agreement
until the effect of all such Events of Default with respect to such Capital
Securities have been cured, waived or otherwise eliminated. Until any such
Events of Default under the applicable Trust Agreement with respect to the
Capital Securities have been so cured, waived or otherwise eliminated, the
Property Trustee shall act solely on behalf of the holders of such Capital
Securities and not on behalf of the holders of the Common Securities, and only
the holders of such Capital Securities will have the right to direct the
Property Trustee to act on their behalf.
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LIQUIDATION DISTRIBUTION UPON TERMINATION
Pursuant to each Trust Agreement, each Issuer shall automatically terminate
upon expiration of its term and shall terminate on the first to occur of: (i)
certain events of bankruptcy, dissolution or liquidation of the holder of the
Common Securities; (ii) the distribution of a Like Amount of the Corresponding
Junior Subordinated Debentures to the holders of its Trust Securities, if the
holders of Common Securities have given written direction to the Property
Trustee to terminate such Issuer (which direction is optional and wholly
within the discretion of the holders of Common Securities); (iii) redemption
of all of the Issuer's Trust Securities as described under "Description of
Capital Securities--Redemption or Exchange--Mandatory Redemption"; and (iv)
the entry of an order for the dissolution of the Issuer by a court of
competent jurisdiction.
If early termination of an Issuer occurs as described in clause (i), (ii) or
(iv) above, the Issuer shall be liquidated by the Property Trustee as
expeditiously as the Property Trustee determines to be possible by
distributing, after satisfaction of liabilities to creditors of such Issuer as
provided by applicable law, to the holders of such Trust Securities in
exchange therefor a Like Amount of the Corresponding Junior Subordinated
Debentures, unless such distribution is determined by the Property Trustee not
to be practical, in which event such holders will be entitled to receive out
of the assets of such Issuer available for distribution to holders, after
satisfaction of liabilities to creditors of such Issuer 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 Distribution can be paid only
in part because such Issuer has insufficient assets available to pay in full
the aggregate Liquidation Distribution, then the amounts payable directly by
such Issuer on its Capital Securities shall be paid on a pro rata basis. The
holder(s) of such Issuer's Common Securities will be entitled to receive
distributions upon any such liquidation pro rata with the holders of its
Capital Securities, except that if a Debenture Event of Default has occurred
and is continuing, the Capital Securities shall have a priority over the
Common Securities.
EVENTS OF DEFAULT; NOTICE
Any one of the following events constitutes an "Event of Default" under each
Trust Agreement with respect to the Capital Securities issued thereunder
(whatever the reason for such Event of Default and whether it shall be
voluntary or involuntary or be effected by operation of law or pursuant to any
judgment, decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(i) the occurrence of a Debenture Event of Default under the Indenture
(see "Description of Junior Subordinated Debentures--Debenture Events of
Default"); or
(ii) default by the Issuer in the payment of any Distribution when it
becomes due and payable, and continuation of such default for a period of
30 days; or
(iii) default by the Issuer in the payment of any Redemption Price of any
Trust Security when it becomes due and payable; or
(iv) default in the performance, or breach, in any material respect, of
any covenant or warranty of the Issuer Trustees in such Trust Agreement
(other than a covenant or warranty a default in the performance of which or
the breach of which is dealt with in clause (ii) or (iii) above), and
continuation of such default or breach for a period of 60 days after there
has been given, by registered or certified mail, to the defaulting Issuer
Trustees and the Corporation by the holders of at least 25% in aggregate
Liquidation Amount of the outstanding Capital Securities of the applicable
Issuer, a written notice specifying such default or breach and requiring it
to be remedied and stating that such notice is a "Notice of Default" under
such Trust Agreement; or
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(v) the occurrence of certain events of bankruptcy or insolvency with
respect to the Property Trustee if a successor Property Trustee has not
been appointed within 90 days thereof.
Within five Business Days after the occurrence of any Event of Default
actually known to the Property Trustee, the Property Trustee shall transmit
notice of such Event of Default to the holders of such Issuer's Trust
Securities and the Administrators unless such Event of Default shall have been
cured or waived. The Corporation, as Depositor, and the Administrators are
required to file annually with the Property Trustee a certificate as to
whether or not they are in compliance with all the conditions and covenants
applicable to them under each Trust Agreement.
If a Debenture Event of Default has occurred and is continuing, the Capital
Securities shall have a preference over the Common Securities as described
above. See "--Liquidation Distribution Upon Termination". The existence of an
Event of Default does not entitle the holders of Capital Securities to
accelerate the maturity thereof.
REMOVAL OF ISSUER TRUSTEES; APPOINTMENT OF SUCCESSORS
The holders of at least a majority in aggregate Liquidation Amount of the
outstanding Capital Securities may remove the related Issuer Trustees for
cause or, if a Debenture Event of Default has occurred and is continuing, with
or without cause. If an Issuer Trustee is removed by the holders of the
outstanding Capital Securities, the successor may be appointed by the holders
of at least 25% in Liquidation Amount of Capital Securities. If an Issuer
Trustee resigns, such Trustee will appoint its successor. If an Issuer Trustee
fails to appoint a successor, the holders of at least 25% in Liquidation
Amount of the outstanding Capital Securities may appoint a successor. If a
successor has not been appointed by the holders, any holder of Capital
Securities or Common Securities or the other Issuer Trustee may petition a
court in the State of Delaware to appoint a successor. Any Delaware Trustee
must meet the applicable requirements of Delaware law. Any Property Trustee
must be a national or state-chartered bank, and at the time of appointment
have securities rated in one of the three highest rating categories by a
nationally recognized statistical rating organization and have capital and
surplus of at least $50,000,000. No resignation or removal of an Issuer
Trustee and no appointment of a successor trustee shall be effective until the
acceptance of appointment by the successor trustee in accordance with the
provisions of the applicable Trust Agreement.
MERGER OR CONSOLIDATION OF ISSUER TRUSTEES
Any Person into which the Property Trustee or the Delaware Trustee may be
merged or converted or with which it may be consolidated, or any Person
resulting from any merger, conversion or consolidation to which such Trustee
shall be a party, or any Person succeeding to all or substantially all the
corporate trust business of such Trustee, shall be the successor of such
Issuer Trustee under each Trust Agreement, provided such Entity shall be
otherwise qualified and eligible.
MERGERS, CONSOLIDATIONS, AMALGAMATIONS OR REPLACEMENTS OF THE ISSUERS
An Issuer may not merge with or into, consolidate, amalgamate, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other Person, except as
described below. An Issuer may, at the request of the holders of the Common
Securities and 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, or be replaced by or convey, transfer or lease its
properties and assets substantially as an entirety to a trust organized as
such under the laws of any state, provided, that (i) such successor entity
either (a) expressly assumes all of the obligations of the Issuer 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
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in priority with respect to distributions and payments upon liquidation,
redemption and otherwise, (ii) a trustee of such successor entity possessing
the same powers and duties as the Property Trustee is appointed to hold the
Corresponding Junior Subordinated Debentures, (iii) the Successor Securities
are listed, or any Successor Securities will be listed upon notification of
issuance, on any national securities exchange or other organization on which
the Capital Securities are then listed, if any, (iv) such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease does
not cause the Capital Securities to be downgraded by any nationally recognized
statistical rating organization which assigns ratings to the Capital
Securities, (v) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the material rights,
preferences and privileges of the holders of the Capital Securities (including
any Successor Securities) in any material respect, (vi) such successor entity
has a purpose identical to that of the Issuer, (vii) prior to such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease, the
Corporation has received an opinion from independent counsel to the Issuer
experienced in such matters to the effect that (a) such merger, consolidation,
amalgamation, replacement, conveyance, transfer or lease does not adversely
affect the material rights, preferences and privileges of the holders of the
Capital Securities (including any Successor Securities) in any material
respect, and (b) following such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, neither the Issuer nor such
successor entity will be required to register as an investment company under
the Investment Company Act; and (viii) the Corporation or any permitted
successor or assignee owns all of the Common Securities of such successor
entity and guarantees the obligations of such successor entity under the
Successor Securities at least to the extent provided by the Guarantee.
Notwithstanding the foregoing, an Issuer shall not, except with the consent of
holders of 100% in aggregate Liquidation Amount of the Capital Securities,
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 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 Issuer or the
successor entity to be classified as an association taxable as a corporation
or as other than a grantor trust for United States federal income tax purposes
or cause the Junior Subordinated Debentures to be treated as other than
indebtedness of the Corporation for United States federal income tax purposes.
VOTING RIGHTS; AMENDMENT OF EACH TRUST AGREEMENT
Except as provided below and under "Description of Guarantees--Amendments
and Assignment" and as otherwise required by law and the Trust Agreement, the
holders of the Capital Securities will have no voting rights.
Each Trust Agreement may be amended from time to time by the holders of a
majority of the Common Securities and the Property Trustee, without the
consent of the holders of the Capital Securities (i) to cure any ambiguity,
correct or supplement any provisions in such Trust Agreement that may be
inconsistent with any other provision, or to make any other provisions with
respect to matters or questions arising under such Trust Agreement, which are
not inconsistent with the other provisions of such Trust Agreement, or (ii) to
modify, eliminate or add to any provisions of such Trust Agreement to such
extent as may be necessary to ensure that the Issuer will not be taxable as a
corporation or be classified as other than a grantor trust for United States
federal income tax purposes at any time that any Trust Securities are
outstanding, or to ensure that the Junior Subordinated Debentures are treated
as indebtedness of the Corporation for United States federal income tax
purposes or to ensure that the related Issuer will not be required to register
as an "investment company" under the Investment Company Act, provided,
however, that in the case of either clause (i) or (ii) such action shall not
adversely affect in any material respect the interests of any holder and any
amendments of such Trust Agreement will become effective when notice of such
amendment is given to the holders of Trust Securities. Each Trust Agreement
may be amended by the holders of a majority of the Common Securities and the
Property Trustee with (i) the consent of holders representing not less than a
majority in aggregate Liquidation Amount of the outstanding Capital Securities
and (ii) receipt by the Issuer
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Trustees of an opinion of counsel to the effect that such amendment or the
exercise of any power granted to the Issuer Trustees in accordance with such
amendment will not affect the Issuer's not being taxable as a corporation for
United States federal income tax purposes or the Issuer's exemption from
status as an "investment company" under the Investment Company Act, except
that without the consent of each holder of Trust Securities, such Trust
Agreement may not be amended to (a) change the amount or timing of any
Distribution on the Trust Securities or otherwise adversely affect the amount
of any Distribution required to be made in respect of the Trust Securities as
of a specified date or (b) restrict the right of a holder of Trust Securities
to institute suit for the enforcement of any such payment on or after such
date.
So long as any Corresponding Junior Subordinated Debentures are held by the
Property Trustee, the Property Trustee shall not (i) direct the time, method
and place of conducting any proceeding for any remedy available to the
Debenture Trustee, or executing any trust or power conferred on the Property
Trustee with respect to the Corresponding Junior Subordinated Debentures, (ii)
waive any past default that is waivable under the Indenture, (iii) exercise
any right to rescind or annul a declaration that the principal of all the
Corresponding Junior Subordinated Debentures shall be due and payable or (iv)
consent to any amendment, modification or termination of the Indenture or the
Corresponding Junior Subordinated Debentures, where such consent shall be
required, without, in each case, obtaining the prior approval of the holders
of a majority in aggregate Liquidation Amount of all outstanding Capital
Securities, provided, however, that where a consent under the Indenture would
require the consent of each holder of Corresponding Junior Subordinated
Debentures affected thereby, no such consent shall be given by the Property
Trustee without the prior consent of each holder of the corresponding Capital
Securities. The Property Trustee shall not revoke any action previously
authorized or approved by a vote of the holders of the Capital Securities
except by subsequent vote of the holders of the Capital Securities. The
Property Trustee shall notify each holder of Capital Securities of any notice
of default with respect to the Junior Subordinated Debentures. In addition to
obtaining the foregoing approvals of the holders of the Capital Securities,
prior to taking any of the foregoing actions, the Property Trustee shall
obtain an opinion of counsel experienced in such matters to the effect that
the Issuer will not be classified as an association taxable as a corporation
for United States federal income tax purposes on account of such action and
such action would not cause the Issuer to be classified as other than a
grantor trust for United States federal income tax purposes and would not
cause the Junior Subordinated Debentures to be treated as other than
indebtedness of the Corporation for United States federal income tax purposes.
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 Property Trustee will cause a notice of any meeting at
which holders of Capital Securities are entitled to vote, or of any matter
upon which action by written consent of such holders is to be taken, to be
given to each holder of record of Capital Securities in the manner set forth
in each Trust Agreement.
No vote or consent of the holders of Capital Securities will be required for
an Issuer to redeem and cancel its Capital Securities in accordance with the
applicable Trust Agreement.
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 Corporation, the Issuer Trustees or any
affiliate of the Corporation or any Issuer Trustees, shall, for purposes of
such vote or consent, be treated as if they were not outstanding.
GLOBAL CAPITAL SECURITIES
The Capital Securities of any series may be issued in whole or in part in
the form of one or more Global Capital Securities that will be deposited with,
or on behalf of, DTC and registered in the name of a nominee of DTC. Global
Capital Securities may be issued only in fully registered form and in either
temporary or permanent form. Unless and until it is exchanged in whole or in
part for the individual Capital Securities represented thereby, a Global
Capital Security may not be transferred except as a
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whole by DTC to a nominee of DTC or by a nominee of DTC to DTC or another
nominee of DTC or by DTC or any nominee to a successor depositary or any
nominee of such successor.
The specific terms of the depositary arrangement with respect to a series of
Capital Securities will be described in the Prospectus Supplement relating to
such series. The Corporation anticipates that the following provisions will
generally apply to depositary arrangements.
Upon the issuance of a Global Capital Security, and the deposit of such
Global Capital Security with or on behalf of DTC, DTC or its nominee will
credit, on its book-entry registration and transfer system, the respective
aggregate Liquidation Amounts of the individual Capital Securities represented
by such Global Capital Securities to the accounts of Participants. Such
accounts shall initially be designated by the dealers, underwriters or agents
with respect to such Capital Securities or by the Corporation if such Capital
Securities are offered and sold directly by the Corporation. Ownership of
beneficial interests in a Global Capital Security will be limited to
Participants or persons that may hold interests through Participants.
Ownership of beneficial interests in such Global Capital Security will be
shown on, and the transfer of that ownership will be effected only through,
records maintained by DTC or its nominee (with respect to interests of
Participants) and the records of Participants (with respect to interests of
persons who hold through Participants).
So long as DTC, or its nominee, is the registered owner of such Global
Capital Security, DTC or such nominee, as the case may be, will be considered
the sole owner or holder of the Capital Securities represented by such Global
Capital Security for all purposes under the Indenture governing such Capital
Securities. Except as provided below, owners of beneficial interests in a
Global Capital Security will not be entitled to have any of the individual
Capital Securities of the series registered in their names, will not receive
or be entitled to receive physical delivery of any such Capital Securities of
such series in definitive form and will not be considered the owners or
holders thereof under the Indenture.
Payments of principal of (and premium, if any) and interest on individual
Capital Securities represented by a Global Capital Security registered in the
name of DTC or its nominee will be made to DTC or its nominee, as the case may
be, as the registered owner of the Global Capital Security representing such
Capital Securities. None of the Corporation, the Property Trustee, any Paying
Agent, or the Securities Registrar for such Capital Securities will have any
responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests of the Global
Capital Security representing such Capital Securities or for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests.
The Corporation expects that DTC or its nominee, upon receipt of any payment
of Liquidation Amount, premium or Distributions, including any payment of
Redemption Price, in respect of a Global Capital Security representing Capital
Securities of a series immediately will credit Participants' accounts with
payments in amounts proportionate to their respective beneficial interest in
the aggregate Liquidation Amount of such Global Capital Security for such
Capital Securities as shown on the records of DTC or its nominee. The
Corporation also expects that payments by Participants, including Euroclear
and Cedel Bank, to owners of beneficial interests in such Global Capital
Security held through such Participants will be governed by standing
instructions and customary practices, as is now the case with securities held
for the accounts of customers in bearer form or registered in "street name."
Such payments will be the responsibility of such Participants.
Unless otherwise specified in the applicable Prospectus Supplement, if DTC
is at any time unwilling, unable or ineligible to continue as depositary and a
successor depositary is not appointed by the Issuer within 90 days, or if
there shall have occurred and be continuing an event of default under the
Indenture with respect to the Junior Subordinated Debentures of such series,
the Issuer will issue individual Capital Securities of such series in exchange
for the Global Capital Security representing such series of Capital
Securities. In addition, the Issuer may at any time, in its sole discretion,
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determine not to have any Capital Securities of such series represented by one
or more Global Capital Securities and, in such event, will issue certificated
Capital Securities of such series in exchange for the Global Capital Security
or Securities representing such series of Capital Securities. Further, if the
Issuer so specifies with respect to the Capital Securities of a series, an
owner of a beneficial interest in a Global Capital Security representing
Capital Securities of such series may, on terms acceptable to the Issuer, the
Property Trustee and DTC, receive individual Capital Securities of such series
in exchange for such beneficial interests, subject to any limitations
described in the Prospectus Supplement relating to such Capital Securities. In
any such instance, an owner of a beneficial interest in a Global Capital
Security will be entitled to physical delivery of individual Capital
Securities of the series equal in principal amount to such beneficial interest
and to have such Capital Securities registered in its name. Individual Capital
Securities of such series so issued will be issued in denominations, unless
otherwise specified by the Issuer, and integral multiples thereof that are the
same as the denominations and multiples in which the Capital Securities are
issued.
PAYMENT AND PAYING AGENCY
Payments in respect of the Capital Securities shall be made to DTC, which
shall credit the relevant accounts at DTC on the applicable Distribution Dates
or, if any Issuer's Capital Securities are not held by DTC, such payments
shall be made by check mailed to the address of the holder entitled thereto as
such address shall appear on the Register. Unless otherwise specified in the
applicable Prospectus Supplement, 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 Administrators. The Paying Agent shall
be permitted to resign as Paying Agent upon 30 days' written notice to the
Property Trustee and the Corporation. In the event that the Property Trustee
shall no longer be the Paying Agent, the Property Trustee shall appoint a
successor (which shall be a bank or trust company acceptable to the
Administrators) to act as Paying Agent.
REGISTRAR AND TRANSFER AGENT
Unless otherwise specified in the applicable Prospectus Supplement, the
Property Trustee will act as registrar and transfer agent for the Capital
Securities.
Registration of transfers of Capital Securities will be effected without
charge by or on behalf of each Issuer, but upon payment of any tax or other
governmental charges that may be imposed in connection with any transfer or
exchange. The Issuer will not be required to register or cause to be
registered the transfer of their Capital Securities after such Capital
Securities have been called for redemption.
INFORMATION CONCERNING THE PROPERTY TRUSTEE
The Property Trustee, other than during the occurrence and continuance of an
Event of Default, undertakes to perform only such duties as are specifically
set forth in each Trust Agreement and, after such Event of Default, must
exercise the same degree of care and skill as a prudent person would exercise
or use in the conduct of his or her own affairs. Subject to this provision,
the Property Trustee is under no obligation to exercise any of the powers
vested in it by the applicable Trust Agreement 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 Event of
Default has occurred and is continuing and the Property Trustee is required to
decide between alternative causes of action, construe ambiguous provisions in
the applicable Trust Agreement or is unsure of the application of any
provision of the applicable Trust Agreement, and the matter is not one on
which holders of Trust Securities are entitled under such Trust Agreement to
vote, then the Property Trustee shall take such action as it deems advisable
and in the best interests of the holders of the Trust Securities and will have
no liability except for its own bad faith, negligence or willful misconduct.
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MISCELLANEOUS
The Administrators and the Property Trustee are authorized and directed to
conduct the affairs of and to operate the Issuers in such a way that no Issuer
will be deemed to be an "investment company" required to be registered under
the Investment Company Act or classified as an association taxable as a
corporation or as other than a grantor trust for United States federal income
tax purposes and so that the Corresponding Junior Subordinated Debentures will
be treated as indebtedness of the Corporation for United States federal income
tax purposes. In this connection, the Property Trustee and the holders of
Common Securities are authorized to take any action, not inconsistent with
applicable law, the certificate of trust of each Issuer or each Trust
Agreement, that the Property Trustee and the holders of Common Securities
determine in their discretion to be necessary or desirable for such purposes,
as long as such action does not materially adversely affect the interests of
the holders of the related Capital Securities.
Holders of the Capital Securities have no preemptive or similar rights.
The Issuer may not borrow money or issue debt or mortgage or pledge any of
its assets.
BOOK-ENTRY ISSUANCE
DTC will act as securities depositary for all of the Capital Securities and
the Junior Subordinated Debentures. The Capital Securities and the Junior
Subordinated Debentures will be issued only as fully-registered securities
registered in the name of Cede & Co. (DTC's nominee) for credit to the
respective accounts of the purchasers at DTC, Euroclear and Cedel Bank. One or
more fully-registered global certificates will be issued for the Capital
Securities and the Junior Subordinated Debentures of each Issuer, representing
in the aggregate the total number of such Issuer's Capital Securities or
aggregate principal balance of the Junior Subordinated Debentures,
respectively, and will be deposited with DTC.
The Corporation and each Issuer understand that: DTC is a limited purpose
trust company organized under the New York Banking Law, a "banking
organization" within the meaning of the New York Banking Law, a member of the
Federal Reserve System, a "clearing corporation" within the meaning of the New
York Uniform Commercial Code, and a "clearing agency" registered pursuant to
the provisions of Section 17A of the Exchange Act. DTC holds securities that
its Participants deposit with DTC. DTC also facilitates the settlement among
Participants of securities transactions, such as transfers and pledges, in
deposited securities through electronic computerized book-entry changes in
Participants' accounts, thereby eliminating the need for physical movement of
securities certificates. "Direct Participants" include securities brokers and
dealers, banks, trust companies, clearing corporations and certain other
organizations. DTC is owned by a number of its Direct Participants and by the
New York Stock Exchange, Inc., the American Stock Exchange, Inc. and the
National Association of Securities Dealers, Inc. Access to the DTC system is
also available to others such as securities brokers and dealers, banks and
trust companies that clear through or maintain custodial relationships with
Direct Participants, either directly or indirectly ("Indirect Participants").
The rules applicable to DTC and its Participants are on file with the
Commission.
Purchases of Capital Securities or Junior Subordinated Debentures within the
DTC system must be made by or through Direct Participants, which will receive
a credit for the Capital Securities or Junior Subordinated Debentures on DTC's
records. The ownership interest of each actual purchaser of each Capital
Security and each Junior Subordinated Debenture ("Beneficial Owner") is in
turn to be recorded on the Direct and Indirect Participants' records.
Beneficial Owners will not receive written confirmation from DTC of their
purchases, but Beneficial Owners are expected to receive written confirmations
providing details of the transactions, as well as periodic statements of their
holdings, from the Direct or Indirect Participants through which the
Beneficial Owners purchased Capital Securities or Junior Subordinated
Debentures. Transfers of ownership interests in the Capital
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Securities or Junior Subordinated Debentures are to be accomplished by entries
made on the books of Participants acting on behalf of Beneficial Owners.
Beneficial Owners will not receive certificates representing their ownership
interests in Capital Securities or Junior Subordinated Debentures, except in
the event that use of the book-entry system for the Capital Securities of such
Issuer or Junior Subordinated Debentures is discontinued.
Transfers between Participants in DTC will be effected in the ordinary way
in accordance with DTC rules and will be settled in same-day funds. The laws
of some states require that certain persons take physical delivery of
securities in definitive form. Consequently, the ability to transfer
beneficial interests in a Global Capital Security to such persons may be
limited. Because DTC can only act on behalf of Direct Participants, who in
turn act on behalf of Indirect Participants and certain banks, the ability of
a person having a beneficial interest in a Global Capital Security to pledge
such interest to persons or entities that do not participate in the DTC
system, or otherwise take actions in respect of such interest, may be affected
by the lack of a physical certificate of such interest. Transfers between
Participants in Euroclear and Cedel will be effected in the ordinary way in
accordance with their respective rules an operating procedures.
Cross-market transfers between DTC participants, on the one hand, and
directly or indirectly through Euroclear or Cedel Bank participants, on the
other, will be effected in DTC in accordance with DTC rules on behalf of
Euroclear or Cedel Bank, as the case may be, by its respective depositary;
however, such cross-market transactions will require delivery of instructions
to Euroclear or Cedel Bank, as the case may be, by the counterparty in such
system in accordance with its rules and procedures and within its established
deadlines (Brussels time). Euroclear or Cedel Bank, 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 a Global Capital Security in
DTC, and making or receiving payment in accordance with normal procedures for
same-day funds settlement applicable to DTC, Cedel Bank participants and
Euroclear participants may not deliver instructions directly to the
depositaries for Cedel Bank or Euroclear.
Because of time zone differences, the securities account of a Euroclear or
Cedel Bank participant purchasing an interest in a Global Capital Security
from a DTC participant will be credited during the securities settlement
processing day (which must be a business day for Euroclear and Cedel Bank)
immediately following the DTC settlement date, and such credit will be
reported to the relevant Euroclear or Cedel Bank participant on such
processing day. Cash received in Euroclear or Cedel Bank as a result of sales
of interests in a Global Capital Security by or through a Euroclear or Cedel
Bank participant to a DTC participant will be received with value on the DTC
settlement date but will be available in the relevant Euroclear or Cedel Bank
cash account only as of the business day following settlement in DTC.
DTC has no knowledge of the actual Beneficial Owners of the Capital
Securities or Junior Subordinated Debentures; DTC's records reflect only the
identity of the Direct Participants to whose accounts such Capital Securities
or Junior Subordinated Debentures are credited, which may or may not be the
Beneficial Owners. The Participants will remain responsible for keeping
account of their holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct
Participants and Indirect Participants to Beneficial Owners and the voting
rights of Direct Participants, Indirect Participants and Beneficial Owners
will be governed by arrangements among them, subject to any statutory or
regulatory requirements as may be in effect from time to time.
Redemption notices will be sent to Cede & Co. as the registered holder of
the Capital Securities or Junior Subordinated Debentures. If less than all of
an Issuer's Capital Securities or the Junior
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Subordinated Debentures are being redeemed, DTC's current practice is to
determine by lot the amount of the interest of each Direct Participant to be
redeemed.
Although voting with respect to the Capital Securities or the Junior
Subordinated Debentures is limited to the holders of record of the Capital
Securities or Junior Subordinated Debentures, in those instances in which a
vote is required, neither DTC nor Cede & Co. will itself consent or vote with
respect to Capital Securities or Junior Subordinated Debentures. Under its
usual procedures, DTC would mail an omnibus proxy (the "Omnibus Proxy") to the
Property Trustee as soon as possible after the record date. The Omnibus Proxy
assigns Cede & Co.'s consenting or voting rights to those Direct Participants
to whose accounts such Capital Securities or Junior Subordinated Debentures
are credited on the record date (identified in a listing attached to the
Omnibus Proxy).
The Corporation expects that DTC or its nominee, upon receipt of payments in
respect of each Global Capital Security, will immediately credit Participants'
accounts with payments in amounts proportionate to their respective beneficial
interests in the principal amount of each Global Capital Security as shown on
the records of DTC or its nominee. The Corporation also expects that payments
by Participants to owners of beneficial interests in each Global Capital
Security held through such Participants, including Cedel Bank and Euroclear,
will be governed by standing instructions and customary practices, and, in the
case of Cedel Bank and Euroclear, in accordance with the relevant system's
rules and procedures. Such payments will be the responsibility of such
Participants.
DTC may discontinue providing its services as securities depositary with
respect to any of the Capital Securities or the Junior Subordinated Debentures
at any time by giving reasonable notice to the Property Trustee and the
Corporation. In the event that a successor securities depositary is not
obtained, definitive Capital Security or Junior Subordinated Debenture
certificates representing such Capital Securities or Junior Subordinated
Debentures are required to be printed and delivered. The Corporation, at its
option, may decide to discontinue use of the system of book-entry transfers
through DTC (or a successor depositary). After a Debenture Event of Default,
the holders of a majority in liquidation preference of Capital Securities or
aggregate principal amount of Junior Subordinated Debentures may determine to
discontinue the system of book-entry transfers through DTC. In any such event,
definitive certificates for such Capital Securities or Junior Subordinated
Debentures will be printed and delivered.
Although DTC, Cedel Bank and Euroclear have agreed to the foregoing
procedures in order to facilitate transfers of interests in the Global Capital
Securities among participants of DTC, Cedel Bank and Euroclear, they are under
no obligation to perform or continue to perform such procedures, and such
procedures may be discontinued at any time. Neither the Company nor the
Issuers will have any responsibility for the performance by DTC, Cedel Bank,
or Euroclear or their respective participants or indirect participants of
their respective obligations under the rules and procedures governing their
operations.
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DESCRIPTION OF GUARANTEES
A Guarantee will be executed and delivered by the Corporation concurrently
with the issuance by each Issuer of its Capital Securities for the benefit of
the holders from time to time of such Capital Securities. Bankers Trust
Company will act as indenture trustee ("Guarantee Trustee") under each
Guarantee for the purposes of compliance with the Trust Indenture Act and each
Guarantee will be qualified as an indenture under the Trust Indenture Act.
This summary of certain provisions of the Guarantees, which summarizes the
material terms thereof, does not purport to be complete and is subject to, and
qualified in its entirety by reference to, all of the provisions of each
Guarantee, including the definitions therein of certain terms, and the Trust
Indenture Act, to each of which reference is hereby made. The form of the
Guarantee has been filed as an exhibit to the Registration Statement of which
this Prospectus forms a part. Reference in this summary to Capital Securities
means that Issuer's Capital Securities to which a Guarantee relates. The
Guarantee Trustee will hold each Guarantee for the benefit of the holders of
the related Issuer's Capital Securities.
GENERAL
The Corporation will irrevocably agree to pay in full on a subordinated
basis, to the extent set forth herein, the Guarantee Payments (as defined
below) to the holders of the Capital Securities, as and when due, regardless
of any defense, right of set-off or counterclaim that such Issuer 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
related Issuer (the "Guarantee Payments"), will be subject to the Guarantee:
(i) any accumulated and unpaid Distributions required to be paid on such
Capital Securities, to the extent that such Issuer has funds on hand available
therefor at such time, (ii) the Redemption Price with respect to any Capital
Securities called for redemption, to the extent that such Issuer has funds on
hand available therefor at such time, or (iii) upon a voluntary or involuntary
dissolution, winding up or liquidation of such Issuer (unless the
Corresponding Junior Subordinated Debentures are distributed to holders of
such Capital Securities in exchange therefor), the lesser of (a) the
Liquidation Distribution and (b) the amount of assets of such Issuer remaining
available for distribution to holders of Capital Securities after satisfaction
of liabilities to creditors of such Issuer as required by applicable law. The
Corporation's obligation to make a Guarantee Payment may be satisfied by
direct payment of the required amounts by the Corporation to the holders of
the applicable Capital Securities or by causing the Issuer to pay such amounts
to such holders.
Each Guarantee will be an irrevocable guarantee on a subordinated basis of
the related Issuer's obligations under the Capital Securities, but will apply
only to the extent that such related Issuer has funds sufficient to make such
payments, and is not a guarantee of collection.
If the Corporation does not make interest payments on the Corresponding
Junior Subordinated Debentures held by the Issuer, the Issuer will not be able
to pay Distributions on the Related Capital Securities and will not have funds
legally available therefor. Each Guarantee will rank subordinate and junior in
right of payment to all Senior Debt of the Corporation. See "--Status of the
Guarantee". Because the Corporation is a holding company, the right of the
Corporation to participate in any distribution of assets of any subsidiary
upon such subsidiary's liquidation or reorganization or otherwise, is subject
to the prior claims of creditors of that subsidiary, except to the extent the
Corporation may itself be recognized as a creditor of that subsidiary.
Accordingly, the Corporation's obligations under the Guarantees will be
effectively subordinated to all existing and future liabilities of the
Corporation's subsidiaries, and claimants should look only to the assets of
the Corporation for payments thereunder. See "The Corporation". Except as
otherwise provided in the applicable Prospectus Supplement, the Guarantees do
not limit the incurrence or issuance of other secured or unsecured debt of the
Corporation, including Senior Debt, whether under the Indenture, any other
existing indenture or any other indenture that the Corporation may enter into
in the future or otherwise.
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The Corporation has, through the applicable Guarantee, the applicable Trust
Agreement, the applicable series of Corresponding Junior Subordinated
Debentures, the Indenture and the applicable Expense Agreement, taken
together, fully, irrevocably and unconditionally guaranteed all of the
Issuer's obligations under the Capital Securities. No single document standing
alone or operating in conjunction with fewer than all of the other documents
constitutes such guarantee. It is only the combined operation of these
documents that has the effect of providing a full, irrevocable and
unconditional guarantee of the Issuer's obligations under the Capital
Securities. See "Relationship Among the Capital Securities, the Corresponding
Junior Subordinated Debentures and the Guarantees".
STATUS OF THE GUARANTEES
Each Guarantee will constitute an unsecured obligation of the Corporation
and will rank subordinate and junior in right of payment to all Senior Debt of
the Corporation in the same manner as Junior Subordinated Debentures.
Each Guarantee will rank pari passu with all other Guarantees issued by the
Corporation. Each Guarantee will constitute a guarantee of payment and not of
collection (i.e., the guaranteed party may institute a legal proceeding
directly against the Corporation to enforce its rights under the Guarantee
without first instituting a legal proceeding against any other person or
entity). Each Guarantee will be held for the benefit of the holders of the
related Capital Securities. Each Guarantee will not be discharged except by
payment of the Guarantee Payments in full to the extent not paid by the Issuer
or upon distribution to the holders of the Capital Securities of the
Corresponding Junior Subordinated Debentures. None of the Guarantees places a
limitation on the amount of additional Senior Debt that may be incurred by the
Corporation. The Corporation expects from time to time to incur additional
indebtedness constituting Senior Debt.
AMENDMENTS AND ASSIGNMENT
Except with respect to any changes which do not materially adversely affect
the material rights of holders of the related Capital Securities (in which
case no vote will be required), no Guarantee may be amended without the prior
approval of the holders of not less than a majority of the aggregate
Liquidation Amount of such outstanding Capital Securities. The manner of
obtaining any such approval will be as set forth under "Description of Capital
Securities--Voting Rights; Amendment of the Trust Agreement". All guarantees
and agreements contained in each Guarantee shall bind the successors, assigns,
receivers, trustees and representatives of the Corporation and shall inure to
the benefit of the holders of the related Capital Securities then outstanding.
EVENTS OF DEFAULT
An event of default under each Guarantee will occur upon the failure of the
Corporation to perform any of its payment obligations thereunder or to perform
any non-payment obligations if such non-payment default remains unremedied for
30 days. The holders of not less than a majority in aggregate Liquidation
Amount of the related 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 such Guarantee or to direct the exercise of
any trust or power conferred upon the Guarantee Trustee under such Guarantee.
Any holder of the Capital Securities may institute a legal proceeding
directly against the Corporation to enforce its rights under such Guarantee
without first instituting a legal proceeding against the Issuer, the Guarantee
Trustee or any other person or entity.
The Corporation, as guarantor, is required to file annually with the
Guarantee Trustee a certificate as to whether or not the Corporation is in
compliance with all the conditions and covenants applicable to it under the
Guarantee.
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INFORMATION CONCERNING THE GUARANTEE TRUSTEE
The Guarantee Trustee, other than during the occurrence and continuance of a
default by the Corporation in performance of the Guarantee, 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 Securities unless it is offered
reasonable indemnity against the costs, expenses and liabilities that might be
incurred thereby.
TERMINATION OF THE GUARANTEES
Each Guarantee will terminate and be of no further force and effect upon
full payment of the Redemption Price of the related Capital Securities, upon
full payment of the amounts payable upon liquidation of the Issuer or upon
distribution of Corresponding Junior Subordinated Debentures to the holders of
the related Capital Securities in exchange therefor. Each Guarantee will
continue to be effective or will be reinstated, as the case may be, if at any
time any holder of the related Capital Securities must restore payment of any
sums paid under such Capital Securities or such Guarantee.
GOVERNING LAW
Each Guarantee will be governed by and construed in accordance with the laws
of the State of New York.
THE EXPENSE AGREEMENTS
Pursuant to the Expense Agreements entered into by the Corporation under
each Trust Agreement (each, an "Expense Agreement"), the Corporation will
irrevocably and unconditionally guarantee to each Person or entity to whom
each Issuer becomes indebted or liable, the full payment of any costs,
expenses or liabilities of such Issuer, other than obligations of such Issuer
to pay to the holders of any Capital Securities or other similar interests in
such Issuer the amounts due such holders pursuant to the terms of the Capital
Securities or such other similar interests, as the case may be. The Expense
Agreements will be enforceable by third parties.
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<PAGE>
RELATIONSHIP AMONG THE CAPITAL SECURITIES, THE CORRESPONDING JUNIOR
SUBORDINATED DEBENTURES, THE EXPENSE AGREEMENTS AND THE GUARANTEES
FULL AND UNCONDITIONAL GUARANTEE
Payments of Distributions and other amounts due on the Capital Securities
(to the extent the Issuer has funds available for the payment of such
Distributions) are irrevocably guaranteed by the Corporation as and to the
extent set forth under "Description of Guarantees". Taken together, the
Corporation's obligations under each series of Corresponding Junior
Subordinated Debentures, the Indenture, the related Trust Agreement, the
related Expense Agreement, and the related Guarantee provide, in the
aggregate, a full, irrevocable and unconditional guarantee of payments of
Distributions and other amounts due on the Related Capital Securities. No
single document standing alone or operating in conjunction with fewer than all
of the other documents constitutes such guarantee. It is only the combined
operation of these documents that has the effect of providing a full,
irrevocable and unconditional guarantee of the Issuer's obligations under the
Related Capital Securities. If and to the extent that the Corporation does not
make payments on any series of Corresponding Junior Subordinated Debentures,
such Issuer will not pay Distributions or other amounts due on its Related
Capital Securities. The Guarantees do not cover payment of Distributions when
the related Issuer does not have sufficient funds to pay such Distributions.
In such event, the remedy of a holder of a series of Capital Securities is to
institute a legal proceeding directly against the Corporation pursuant to the
terms of the Indenture for enforcement of payment of amounts of such
Distributions to such holder. The obligations of the Corporation under each
Guarantee are subordinate and junior in right of payment to all Senior Debt of
the Corporation.
SUFFICIENCY OF PAYMENTS
As long as payments of interest and other payments are made when due on each
series of Corresponding Junior Subordinated Debentures, such payments will be
sufficient to cover Distributions and other payments due on the Related
Capital Securities, primarily because (i) the aggregate principal amount of
each series of Corresponding Junior Subordinated Debentures will be equal to
the sum of the aggregate stated Liquidation Amount of the Related Capital
Securities and the Common Securities; (ii) the interest rate and interest and
other payment dates on each series of Corresponding Junior Subordinated
Debentures will match the Distribution rate and Distribution and other payment
dates for the Related Capital Securities; (iii) the Corporation shall pay for
all and any costs, expenses and liabilities of such Issuer except such
Issuer's obligations to holders of its Capital Securities under such Capital
Securities; and (iv) each Trust Agreement provides that the Issuer will not
engage in any activity that is not consistent with the limited purposes of
such Issuer.
Notwithstanding anything to the contrary in the Indenture, the Corporation
has the right to set-off any payment it is otherwise required to make
thereunder with and to the extent the Corporation has theretofore made, or is
concurrently on the date of such payment making, a payment under the related
Guarantee.
ENFORCEMENT RIGHTS OF HOLDERS OF CAPITAL SECURITIES
A holder of any Related Capital Security may institute a legal proceeding
directly against the Corporation to enforce its rights under the related
Guarantee without first instituting a legal proceeding against the Guarantee
Trustee, the related Issuer or any other person or entity.
A default or event of default under any Senior Debt of the Corporation would
not constitute a default or Event of Default under the Indenture. However, in
the event of payment defaults under, or acceleration of, Senior Debt of the
Corporation, the subordination provisions of the Indenture provide that no
payments may be made in respect of the Corresponding Junior Subordinated
Debentures until such Senior Debt has been paid in full or any payment default
thereunder has been cured or waived. Failure to make required payments on any
series of Corresponding Junior Subordinated Debentures would constitute an
Event of Default under the Indenture.
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<PAGE>
LIMITED PURPOSE OF THE ISSUERS
Each Issuer's Capital Securities evidence a beneficial interest in such
Issuer, and each Issuer exists for the sole purpose of issuing its Capital
Securities and Common Securities and investing the proceeds thereof in the
Corresponding Junior Subordinated Debentures and engaging in only those other
activities necessary or incidental thereto. A principal difference between the
rights of a holder of a Capital Security and a holder of a Corresponding
Junior Subordinated Debenture is that a holder of a Corresponding Junior
Subordinated Debenture is entitled to receive from the Corporation the
principal amount of and interest accrued on Corresponding Junior Subordinated
Debentures held, while a holder of Capital Securities is entitled to receive
Distributions from the Issuer (or from the Corporation under the Guarantee) if
and to the extent such Issuer has funds available for the payment of such
Distributions.
RIGHTS UPON TERMINATION
Upon any voluntary or involuntary termination, winding-up or liquidation of
any Issuer involving the liquidation of the Corresponding Junior Subordinated
Debentures, the holders of the Related Capital Securities will be entitled to
receive, out of the assets held by such Issuer, the Liquidation Distribution
in cash. See "Description of Capital Securities--Liquidation Distribution Upon
Termination". Upon any voluntary or involuntary liquidation or bankruptcy of
the Corporation, the Property Trustee, as registered holder of the
Corresponding Junior Subordinated Debentures, would be a subordinated creditor
of the Corporation, subordinated in right of payment to all Senior Debt as set
forth in the Indenture, but entitled to receive payment in full of principal
and interest, before any stockholders of the Corporation receive payments or
distributions. Since the Corporation is the guarantor under the Guarantee and
has agreed to pay for all costs, expenses and liabilities of each Issuer
(other than the Issuer's obligations to the holders of its Capital
Securities), the positions of a holder of such Capital Securities and a holder
of such Corresponding Junior Subordinated Debentures relative to other
creditors and to stockholders of the Corporation in the event of liquidation
or bankruptcy of the Corporation are expected to be substantially the same.
PLAN OF DISTRIBUTION
The Junior Subordinated Debentures or the Capital Securities may be sold in
a public offering to or through underwriters or dealers designated from time
to time. The Corporation and each Issuer may sell its Junior Subordinated
Debentures or Capital Securities as soon as practicable after effectiveness of
the Registration Statement of which this Prospectus forms a part. The names of
any underwriters or dealers involved in the sale of the Junior Subordinated
Debentures or Capital Securities in respect of which this Prospectus is
delivered, the amount or number of Junior Subordinated Debentures and Capital
Securities to be purchased by any such underwriters and any applicable
commissions or discounts will be set forth in the applicable Prospectus
Supplement.
Underwriters may offer and sell Junior Subordinated Debentures or Capital
Securities at a fixed price or prices, which may be changed, or from time to
time at market prices prevailing at the time of sale, at prices related to
such prevailing market prices or at negotiated prices. In connection with the
sale of Capital Securities, underwriters may be deemed to have received
compensation from the Corporation and/or the applicable Issuer in the form of
underwriting discounts or commissions and may also receive commissions.
Underwriters may sell Junior Subordinated Debentures or Capital Securities to
or through dealers, and such dealers may receive compensation in the form of
discounts, concessions or commissions from the underwriters.
Any underwriting compensation paid by the Corporation and/or the applicable
Issuer to underwriters in connection with the offering of Junior Subordinated
Debentures or Capital Securities, and any discounts, concessions or
commissions allowed by such underwriters to participating dealers, will be
described in an accompanying Prospectus Supplement. Underwriters and dealers
participating
38
<PAGE>
in the distribution of Junior Subordinated Debentures or Capital Securities
may be deemed to be underwriters, and any discounts and commissions received
by them and any profit realized by them on resale of such Junior Subordinated
Debentures or Capital Securities may be deemed to be underwriting discounts
and commissions, under the Securities Act.
Underwriters and dealers may be entitled, under agreement with the
Corporation and the applicable Issuer to indemnification against and
contribution toward certain civil liabilities, including liabilities under the
Securities Act, and to reimbursement by the Corporation for certain expenses.
In connection with the offering of the Capital Securities of any Issuer,
such Issuer may grant to the underwriters an option to purchase additional
Capital Securities to cover over-allotments, if any, at the initial public
offering price (with an additional underwriting commission), as may be set
forth in the accompanying Prospectus Supplement. If such Issuer grants any
over-allotment option, the terms of such over-allotment option will be set
forth in the Prospectus Supplement for such Capital Securities.
Underwriters and dealers may engage in transactions with, or perform
services for, the Corporation and/or the applicable Issuer and/or any of their
affiliates in the ordinary course of business.
The Junior Subordinated Debentures and the Capital Securities will be new
issues of securities and will have no established trading market. Any
underwriters to whom Junior Subordinated Debentures or Capital Securities are
sold for public offering and sale may make a market in such Junior
Subordinated Debentures and Capital Securities, but such underwriters will not
be obligated to do so and may discontinue any market making at any time
without notice. Such Junior Subordinated Debentures or Capital Securities may
or may not be listed on a national securities exchange or the Nasdaq National
Market. No assurance can be given as to the liquidity of or the existence of
trading markets for any Junior Subordinated Debentures or Capital Securities.
VALIDITY OF SECURITIES
Unless otherwise indicated in the Prospectus Supplement, certain matters of
Delaware law relating to the validity of the Capital Securities, the
enforceability of the Trust Agreements and the formation of the Issuers will
be passed upon by Richards, Layton & Finger, P.A., special Delaware counsel to
the Corporation and the Issuer. Unless otherwise indicated in the Prospectus
Supplement, the validity of the Guarantees and the Junior Subordinated
Debentures will be passed upon for the Corporation by Louise M. Parent,
Executive Vice President and General Counsel of the Corporation, and for the
underwriters by Sullivan & Cromwell. Certain matters relating to United States
Federal income tax considerations will be passed upon for the Corporation by
Cleary, Gottlieb, Steen & Hamilton, as special tax counsel for the
Corporation.
EXPERTS
The consolidated financial statements of the Corporation as of December 31,
1997 and December 31, 1996, and for each of the years ended December 31, 1997,
1996 and 1995 appearing in its Annual Report on Form 10-K dated March 30,
1998, have been audited by Ernst & Young LLP, independent auditors, as set
forth in their respective reports thereon included therein and incorporated
herein by reference. Such consolidated financial statements are incorporated
herein by reference in reliance upon such reports given upon the authority of
such firms as experts in accounting and auditing.
With respect to the unaudited consolidated interim financial information for
the three month periods ended March 31, 1998 and 1997, incorporated by
reference in the Prospectus and Registration Statement, Ernst & Young LLP,
independent auditors, have reported that they have applied limited
39
<PAGE>
procedures in accordance with professional standards for a review of such
information. However, their separate report, included in the Company's
Quarterly Report on Form 10-Q for the quarter ended March 31, 1998, and
incorporated herein by reference, states that they did not audit and they do
not express an opinion on that interim financial information. Accordingly, the
degree of reliance on their report on such information should be restricted
considering the limited nature of the review procedures applied. The
independent auditors are not subject to the liability provisions of Section 11
of the Securities Act of 1933 for their report on the unaudited interim
financial information because that report is not a "report" or a "part" of the
Registration Statement prepared or certified by the auditors within the
meaning of Sections 7 and 11 of the Securities Act of 1933.
40
<PAGE>
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NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRE-
SENTATION NOT CONTAINED IN THIS PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING PRO-
SPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE
RELIED UPON AS HAVING BEEN AUTHORIZED BY AMERICAN EXPRESS COMPANY CAPITAL
TRUST I, AMERICAN EXPRESS COMPANY OR THE UNDERWRITERS. THIS PROSPECTUS SUPPLE-
MENT AND THE PROSPECTUS DO NOT CONSTITUTE AN OFFER TO SELL OR A SOLICIATION OF
AN OFFER TO BUY ANY OF THE SECURITIES OFFERED HEREBY IN ANY JURISDICTION TO
ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION.
NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS NOR ANY
SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION
THAT THE INFORMATION HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE
HEREOF OR THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF AMERICAN EXPRESS
COMPANY CAPITAL TRUST I OR AMERICAN EXPRESS COMPANY SINCE SUCH DATE.
-----------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
PROSPECTUS SUPPLEMENT
<S> <C>
Risk Factors.............................................................. S-5
American Express Company Capital Trust I.................................. S-9
The Corporation........................................................... S-10
Consolidated Ratio of Earnings to Fixed Charges........................... S-11
Use of Proceeds........................................................... S-12
Capitalization............................................................ S-12
Selected Financial Data................................................... S-13
Accounting Treatment...................................................... S-14
Certain Terms of Capital Securities....................................... S-14
Certain Terms of Subordinated Debentures.................................. S-19
Certain Terms of Guarantee................................................ S-24
U.S. Federal Income Tax Consequences...................................... S-24
Certain ERISA Considerations.............................................. S-29
Underwriting.............................................................. S-31
Validity of Securities.................................................... S-32
PROSPECTUS
Available Information..................................................... 3
Incorporation of Certain Documents by Reference........................... 3
The Corporation........................................................... 5
The Issuers............................................................... 6
Use of Proceeds........................................................... 7
Description of Junior Subordinated Debentures............................. 7
Description of Capital Securities......................................... 19
Book-Entry Issuance....................................................... 31
Description of Guarantees................................................. 34
The Expense Agreements.................................................... 36
Relationship Among the Capital Securities the Corresponding Junior
Subordinated Debentures, the Expense Agreements and the Guarantees....... 37
Plan of Distribution...................................................... 38
Validity of Securities.................................................... 39
Experts................................................................... 39
</TABLE>
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$
AMERICAN EXPRESS COMPANY CAPITAL TRUST I
% CAPITAL SECURITIES, SERIES I
FULLY AND UNCONDITIONALLY GUARANTEED, AS DESCRIBED HEREIN, BY
AMERICAN EXPRESS COMPANY
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LOGO
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<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following is an estimate of the expenses which will be incurred in
connection with the issuance and distribution of the securities being
registered, other than underwriting discounts and commissions:
To be borne by the Corporation:
<TABLE>
<CAPTION>
AMOUNT
TO BE PAID
----------
<S> <C>
Registration Fee.................................................. $147,500
Rating Agency Fees................................................ 25,000
Transfer Agent and Registrar Fees................................. 5,000
Printing and Engraving............................................ 30,000
Legal Fees and Expenses........................................... 150,000
Accounting Fees................................................... 20,000
Blue Sky Fees and Expenses........................................ 25,000
Trustees Fees and Expenses........................................ 5,000
Miscellaneous..................................................... 10,000
--------
Total........................................................... $417,500
========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Article VI of the Corporation's By-laws, as amended, provides as follows:
Section 6.1--The corporation shall, to the fullest extent permitted by
applicable law as the same exists or may hereafter be in effect, indemnify any
person who is or was or has agreed to become a director or officer of the
corporation and who is or was made or threatened to be made a party to, and
may, in its discretion, indemnify, any person who is or was or has agreed to
become a director or officer and is otherwise involved in, any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative, legislative or investigative, including an action by or in the
right of the corporation to procure a judgment in its favor and an action by
or in the right of any other corporation of any type of kind, domestic or
foreign, or any partnership, joint venture, trust, employee benefit plan or
other enterprise, which such person is serving or has served or has agreed to
serve in any capacity at the request of the corporation, by reason of the fact
that he is or was serving or has agreed to serve such other corporation,
partnership, joint venture, trust, employee benefit plan or other enterprise
in any capacity, against judgments, fines, amounts paid or to be paid in
settlement, penalties, costs, charges and expenses, including attorneys' fees,
incurred in connection with such action or proceeding or any appeal thereof;
provided, however, that no indemnification shall be provided to any such
person if a judgment or other final adjudication adverse to the director or
officer establishes (i) that his acts were committed in bad faith or were the
result of active and deliberate dishonesty and, in either case, were material
to the cause of action so adjudicated, or (ii) he personally gained in fact a
financial profit or other advantage to which he was not legally entitled. The
benefits of this Section 6.1 shall extend to the heirs, executors,
administrators and legal representatives of any person entitled to
indemnification under this Section.
Section 6.2--The Board in its discretion may authorize the corporation to
indemnify any person, other than a director or officer, for expenses incurred
or other amounts paid in any civil or criminal action, suit or proceeding, to
which such person was, or was threatened to be made a party by reason of the
fact that he, his testator or intestate is or was an employee of the
corporation.
II-1
<PAGE>
Section 6.3--The corporation may indemnify any person to whom the
corporation is permitted by applicable law or these by-laws to provide
indemnification or the advancement of expenses, whether pursuant to rights
granted pursuant to, or provided by, the New York Business Corporation Law or
any other law or these by-laws or other rights created by (i) a resolution of
shareholders, (ii) a resolution of directors, or (iii) an agreement providing
for such indemnification, it being expressly intended that these by-laws
authorize the creation of other rights in any such manner. The right to be
indemnified and to the reimbursement or advancement of expenses incurred in
defending a proceeding in advance of its final disposition authorized by the
Section 6.3, shall not be exclusive of any other right which any person may
have or hereafter acquire under any statute, provision of the certificate of
incorporation, by-laws, agreement, vote of shareholders or disinterested
directors or otherwise.
Section 6.4--The right to indemnification conferred by Section 6.1, and any
indemnification extended under Section 6.3, (i) is a contract right pursuant
to which the person entitled thereto may bring suit as if the provisions
thereof were set forth in a separate written contract between the corporation
and such person, (ii) is intended to be retroactive to events occurring prior
to the adoption of this Article VI, to the fullest extent permitted by
applicable law, and (iii) shall continue to exist after the rescission or
restrictive modification thereof with respect to events occurring prior
thereto.
With certain limitations, a director or officer of a corporation organized
under the New York Business Corporation Law is entitled to indemnification by
the corporation against reasonable expenses, including attorneys fees,
incurred by him in connection with the defense of a civil or criminal
proceeding to which he has been made, or has threatened to be made, a party by
reason of the fact that he was such director or officer. In certain
circumstances, indemnity is provided against judgments, fines and amounts paid
in settlement. Specific court approval is required in some cases. The
foregoing is subject to the detailed provisions of the New York Business
Corporation Law.
In addition, the Corporation has purchased insurance policies which provide
coverage for its directors and officers in certain situations where the
Corporation cannot directly indemnify such directors or officers.
For the undertaking with respect to indemnification, see Item 17 below.
Reference is made to the Underwriting Agreement, which is filed as Exhibit
1.1 to this Registration Statement.
Under the Trust Agreement, the Corporation will agree to indemnify each of
the Trustees of the Issuers or any predecessor Trustee for the Issuers, and to
hold the Trustees harmless against, any loss, damage, claims, 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 Agreement,
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 under the Trust Agreement.
ITEM 16. EXHIBITS
The following exhibits are filed herewith or incorporated by reference
herein as part of this Registration Statement:
<TABLE>
<C> <S>
1.1 Form of Underwriting Agreement.
3.1 American Express Company's Restated Certificate of Incorporation dated
May 29, 1997, as amended to date (incorporated by reference to Exhibit
4.1 of the Corporation's Registration Statement on Form S-3 (File No.
333-325251), filed with the Commission on July 31, 1997).
3.2 American Express Company's By-Laws, as amended (incorporated by
reference to Exhibit 3.2 of the Corporation's Annual Report on Form 10-
K for the year ended December 31, 1997).
</TABLE>
II-2
<PAGE>
<TABLE>
<C> <S>
4.1 Junior Subordinated Indenture, dated as of , 1998, between
American Express Company and Bankers Trust Company, as Debenture
Trustee.
4.2 Certificate of Trust of American Express Company Capital Trust I.
4.3 Trust Agreement of American Express Company Capital Trust I.
4.4 Certificate of Trust of American Express Company Capital Trust II.
4.5 Trust Agreement of American Express Company Capital Trust II.
4.6 Form of Amended and Restated Trust Agreement of American Express
Company Capital Trust I and American Express Company Capital Trust II.
4.7 Form of Capital Security Certificate for American Express Company
Capital Trust I and American Express Company Capital Trust II (included
as Exhibit E of Exhibit 4.6).
4.8 Form of Guarantee Agreement for American Express Company Capital Trust
I and American Express Company Capital Trust II.
5.1 Opinion of Louise M. Parent, Esq. as to legality of the Junior
Subordinated Debentures and the Guarantees to be issued by American
Express Company.
5.2 Opinion of Richards, Layton & Finger, P.A. as to legality of the
Capital Securities to be issued by American Express Company Capital
Trust I.
5.3 Opinion of Richards, Layton & Finger, P.A. as to the legality of the
Capital Securities to be issued by American Express Company Capital
Trust II.
8.1 Opinion of Cleary, Gottlieb, Steen & Hamilton as to certain United
States federal income tax matters.
12.1 Computation of Ratio Earnings to Fixed Charges and Ratio of Earnings to
Fixed Charges (incorporated by reference to Exhibit 12 of the
Corporation's Quarterly Report on Form 10-Q for the quarter ended March
31, 1998).
15.1 Letter re: unaudited financial information.
23.1 Consent of Ernst & Young LLP.
23.2 Consent of Louise M. Parent, Esq. (included in Exhibit 5.1).
23.3 Consent of Richards, Layton & Finger, P.A. (included in Exhibits 5.2
and 5.3).
23.4 Consent of Cleary, Gottlieb, Steen & Hamilton (included in Exhibit
8.1).
24.1 Power of Attorney.
25.1 Form T-1 Statement of Eligibility of Bankers Trust Company to act as
Trustee under the Junior Subordinated Indenture.
25.2 Form T-1 Statement of Eligibility of Bankers Trust Company to act as
Property Trustee for the Amended and Restated Trust Agreement of
American Express Company Capital Trust I.
25.3 Form T-1 Statement of Eligibility of Bankers Trust Company to act as
Property Trustee for the Amended and Restated Trust Agreement of
American Express Company Capital Trust II.
25.4 Form T-1 Statement of Eligibility of Bankers Trust Company to act as
Guarantee Trustee under the Guarantee for the benefit of the holders of
Capital Securities of American Express Company Capital Trust I.
25.5 Form T-1 Statement of Eligibility of Bankers Trust Company to act as
Guarantee Trustee under the Guarantee for the benefit of holders of
Capital Securities of American Express Company Capital Trust II.
</TABLE>
II-3
<PAGE>
ITEM 17. UNDERTAKING
The undersigned hereby undertake:
(1) to file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) to reflect in the prospectus any facts or events arising after the
effective date of this registration statement (or the most recent post-
effective amendment thereto) which, individually or in the aggregate,
represent a fundamental change in the information set forth in this
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than 20% change in the maximum aggregate offering
price set forth in the "Calculation of Registration Fee" table in the
effective registration statement; and
(iii) to include any material information with respect to the plan of
distribution not previously disclosed in this registration statement or any
material change to such information in this registration statement;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the
information required to be included in post-effective amendment by those
paragraphs is contained in periodic reports filed by a registrant pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in this registration statement.
(2) that, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) to remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of
the offering.
(4) to provide to the underwriter at the closing specified in the
underwriting agreement certificates in such denominations and registered in
such names as required by the underwriter to permit prompt delivery to each
purchaser.
Each of the undersigned registrants hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of a
registrant's Annual Report pursuant to Section 13(a) or 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in this
registration statement shall be deemed to be a new registration statement
relating to the securities offered 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
each registrant pursuant to the provisions described in Item 15 above, or
otherwise, each registrant has been advised that in the opinion of the
Securities and Exchange Commission, such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by each registrant of expenses incurred or paid by a director, officer
or controlling person of each registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, each
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication
of such issue.
II-4
<PAGE>
The undersigned hereby undertake that:
(1) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part of
this registration statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the registrant pursuant to rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities Act
of 1933, each post-effective amendment that contains a form of prospectus
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
II-5
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE CORPORATION
CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL OF THE
REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS REGISTRATION
STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY
AUTHORIZED, IN THE CITY OF NEW YORK, STATE OF NEW YORK ON THE 1ST DAY OF JUNE,
1998.
American Express Company
/s/ Stephen P. Norman
By: _________________________________
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES AND ON THE DATE INDICATED.
NAME TITLE
* Chairman, Chief Executive Officer
- ------------------------------------- and Director
HARVEY GOLUB
* President, Chief Operating Officer
- ------------------------------------- and Director
KENNETH I. CHENAULT
* Vice Chairman and Chief Financial
- ------------------------------------- Officer
RICHARD KARL GOELTZ
* Senior Vice President and
- ------------------------------------- Comptroller
DANIEL T. HENRY
* Director
- -------------------------------------
DANIEL F. AKERSON
* Director
- -------------------------------------
ANNE L. ARMSTRONG
Director
- -------------------------------------
EDWIN L. ARTZT
II-6
<PAGE>
NAME TITLE
* Director
- -------------------------------------
WILLIAM G. BOWEN
* Director
- -------------------------------------
CHARLES W. DUNCAN, JR.
* Director
- -------------------------------------
BEVERLY SILLS GREENOUGH
* Director
- -------------------------------------
F. ROSS JOHNSON
* Director
- -------------------------------------
VERNON E. JORDAN, JR.
* Director
- -------------------------------------
JAN LESCHLY
* Director
- -------------------------------------
DREW LEWIS
* Director
- -------------------------------------
ALDO PAPONE
* Director
- -------------------------------------
FRANK P. POPOFF
/s/ Stephen P. Norman
By: _________________________________
STEPHEN P. NORMAN
(AS ATTORNEY-IN-FACT)
II-7
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AMERICAN EXPRESS
COMPANY CAPITAL TRUST I CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE
THAT IT MEETS ALL OF THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY
CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY OF NEW YORK, STATE OF NEW
YORK ON THE 1ST DAY OF JUNE, 1998.
American Express Company Capital
Trust I
By American Express Company, as
Depositor
/s/ Kim Rosenberg
By: _________________________________
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AMERICAN EXPRESS
COMPANY CAPITAL TRUST II CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE
THAT IT MEETS ALL OF THE REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY
CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY OF NEW YORK, STATE OF NEW
YORK ON THE 1ST DAY OF JUNE, 1998.
American Express Company Capital
Trust II
By American Express Company, as
Depositor
/s/ Kim Rosenberg
By: _________________________________
II-8
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT DESCRIPTION NUMBERED PAGES
------- ----------- --------------
<C> <S> <C>
1.1 Form of Underwriting Agreement.
3.1 American Express Company's Restated Certificate of
Incorporation dated May 29, 1997, as amended to date
(incorporated by reference to Exhibit 4.1 of the
Corporation's Registration Statement on Form S-3
(File No. 333-325251), filed with the Commission on
July 31, 1997).
3.2 American Express Company's By-Laws, as amended
(incorporated by reference to Exhibit 3.2 of the
Corporation's Annual Report on Form 10-K for the year
ended December 31, 1997).
4.1 Junior Subordinated Indenture, dated as of ,
1998, between American Express Company and Bankers
Trust Company, as Debenture Trustee.
4.2 Certificate of Trust of American Express Company
Capital Trust I.
4.3 Trust Agreement of American Express Company Capital
Trust I.
4.4 Certificate of Trust of American Express Company
Capital Trust II.
4.5 Trust Agreement of American Express Company Capital
Trust II.
4.6 Form of Amended and Restated Trust Agreement of
American Express Company Capital Trust I and American
Express Company Capital Trust II.
4.7 Form of Capital Security Certificate for American
Express Company Capital Trust I and American Express
Company Capital Trust II (included as Exhibit E of
Exhibit 4.6).
4.8 Form of Guarantee Agreement for American Express
Company Capital Trust I and American Express Company
Capital Trust II.
5.1 Opinion of Louise M. Parent, Esq. as to legality of
the Junior Subordinated Debentures and the Guarantees
to be issued by American Express Company.
5.2 Opinion of Richards, Layton & Finger, P.A. as to
legality of the Capital Securities to be issued by
American Express Company Capital Trust I.
5.3 Opinion of Richards, Layton & Finger, P.A. as to the
legality of the Capital Securities to be issued by
American Express Company Capital Trust II.
8.1 Opinion of Cleary, Gottlieb, Steen & Hamilton as to
certain United States federal income tax matters.
12.1 Computation of Ratio Earnings to Fixed Charges and
Ratio of Earnings to Fixed Charges (incorporated by
reference to Exhibit 12 of the Corporation's
Quarterly Report on Form 10-Q for the quarter ended
March 31, 1998).
15.1 Letter re: unaudited financial information.
23.1 Consent of Ernst & Young LLP.
23.2 Consent of Louise M. Parent, Esq. (included in
Exhibit 5.1).
23.3 Consent of Richards, Layton & Finger, P.A. (included
in Exhibits 5.2 and 5.3).
23.4 Consent of Cleary, Gottlieb, Steen & Hamilton
(included in Exhibit 8.1).
24.1 Power of Attorney.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT DESCRIPTION NUMBERED PAGES
------- ----------- --------------
<C> <S> <C>
25.1 Form T-1 Statement of Eligibility of Bankers Trust
Company to act as Trustee under the Junior
Subordinated Indenture.
25.2 Form T-1 Statement of Eligibility of Bankers Trust
Company to act as Property Trustee for the Amended
and Restated Trust Agreement of American Express
Company Capital Trust I.
25.3 Form T-1 Statement of Eligibility of Bankers Trust
Company to act as Property Trustee for the Amended
and Restated Trust Agreement of American Express
Company Capital Trust II.
25.4 Form T-1 Statement of Eligibility of Bankers Trust
Company to act as Guarantee Trustee under the
Guarantee for the benefit of the holders of Capital
Securities of American Express Company Capital Trust
I.
25.5 Form T-1 Statement of Eligibility of Bankers Trust
Company to act as Guarantee Trustee under the
Guarantee for the benefit of holders of Capital
Securities of American Express Company Capital Trust
II.
</TABLE>
<PAGE>
Exhibit 1.1
American Express Company Capital Trust I
American Express Company Capital Trust II
Capital Securities
guaranteed to the extent set forth in the Guarantees by
AMERICAN EXPRESS COMPANY
Underwriting Agreement
----------------------
____ __, 199_
To the Representatives of the several Underwriters
named in Schedule I to the respective
Pricing Agreements hereinafter described
Ladies and Gentlemen:
From time to time American Express Company Capital Trust I or American
Express Company Capital Trust II, each a statutory business trust formed under
the laws of the State of Delaware (each a "Trust" and collectively, the
"Trusts"), and American Express Company, a New York corporation (the "Company"),
as depositor of each trust and as guarantor, propose to enter into one or more
Pricing Agreements (each a "Pricing Agreement") in the form of Annex I hereto,
with such additions and deletions as the parties thereto may determine, and,
subject to the terms and conditions stated herein and therein, that the Trust
identified in the applicable Pricing Agreement (such Trust being the "Designated
Trust" with respect to such Pricing Agreement) issue and sell to the firms named
in Schedule I to the applicable Pricing Agreement (such firms constituting the
"Underwriters" with respect to such Pricing Agreement and the securities
specified therein) certain of its preferred securities (the "Securities")
representing undivided beneficial interests in the assets of the Designated
Trust. The Securities specified in such Pricing Agreement are referred to as
the "Firm Designated Securities" with respect to such Pricing Agreement. If
specified in such Pricing Agreement, the Designated Trust may grant the
Underwriters the right to purchase at their election an additional number of
Securities, specified as provided in such Pricing Agreement as provided in
Section 3 hereof (the "Optional Designated Securities"). The Firm Designated
Securities and any
<PAGE>
Optional Designated Securities are collectively called the "Designated
Securities." The proceeds of the sale of the Designated Securities to the public
and of common securities of the Designated Trust (the "Common Securities") to
the Company concurrently with the sale of the Designated Securities are to be
invested in junior subordinated deferrable interest debentures of the Company
(the "Subordinated Debentures") identified in the Pricing Agreement with respect
to such Designated Securities (with respect to such Pricing Agreement, the
"Designated Subordinated Debentures"), to be issued pursuant to a junior
subordinated indenture to be dated as of June __, 1998 (the "Indenture") between
the Company and Bankers Trust Company as trustee (the "Indenture Trustee"). The
Designated Securities may be exchangeable into Designated Subordinated
Debentures, as specified in Schedule II to such Pricing Agreement. The
Designated Securities will be guaranteed by the Company to the extent set forth
in the Pricing Agreement with respect to such Designated Securities (the
"Designated Guarantee") (all such Designated Guarantees together, the
"Guarantees").
The terms and rights of any particular issuance of Designated Securities
shall be as specified in the Pricing Agreement relating thereto and in or
pursuant to the amended and restated trust agreement identified in such Pricing
Agreement (with respect to such Pricing Agreement, the "Trust Agreement").
1. Particular sales of Designated Securities may be made from time to time to
the Underwriters of such Designated Securities, for whom the firms designated as
representatives of the Underwriters of such Designated Securities in the Pricing
Agreement relating thereto will act as representatives (the "Representatives").
The term "Representatives" also refers to a single firm acting as sole
representative of the Underwriters and to Underwriters who act without any firm
being designated as their representative. This Underwriting Agreement shall not
be construed as an obligation of either Trust to sell any of the Securities or
as an obligation of any of the Underwriters to purchase any of the Securities.
The obligation of either Trust to issue and sell any of the Securities and the
obligation of any of the Underwriters to purchase any of the Securities shall be
evidenced by the Pricing Agreement with respect to the Designated Securities
specified therein. Each Pricing Agreement shall specify the aggregate number of
the Firm Designated Securities, the maximum number of Optional Designated
Securities, if any, the initial public offering price of such Firm and Optional
Designated Securities or the manner of determining such price, the terms of the
Designated Securities, including the terms on which and terms of the securities
into which the Designated Securities will be exchangeable, the purchase price to
the Underwriters of such Designated Securities, the names of the Underwriters of
such Designated Securities, the names of the Representatives of such
Underwriters, the number of such Designated Securities to be purchased by each
Underwriter and the commission, if any, payable to the Underwriters with respect
thereto and shall set forth the date, time and manner of delivery of such Firm
Designated Securities and such Optional Designated Securities, if any, and
payment therefor. The Pricing Agreement shall also specify (to the extent not
set forth in the registration statement and prospectus with respect thereto) the
terms of such Designated Securities. A Pricing Agreement shall be in the form of
an executed writing (which may be in counterparts), and may be evidenced by an
exchange of telegraphic communications or any other rapid transmission device
designed to produce a written record of communications transmitted. The standard
provisions set forth herein
2
<PAGE>
will be incorporated by reference in any Pricing Agreement. The obligations of
the Underwriters under this Agreement and each Pricing Agreement shall be
several and not joint.
2. The Designated Trust and the Company, jointly and severally, each
represents and warrants to, and agrees with, each of the Underwriters that:
(a) A registration statement on Form S-3 (File No. 333-[ ]) (the
"Initial Registration Statement") in respect of the Securities, the
Subordinated Debentures and the Guarantees (including the Designated
Securities, the Designated Subordinated Debentures and the Designated
Guarantees) has been filed with the Securities and Exchange Commission (the
"Commission"); the Initial Registration Statement and any post-effective
amendment thereto, each in the form heretofore delivered or to be delivered
to the Representatives and, excluding exhibits to such registration
statement, but including all documents incorporated by reference in the
prospectus included therein, to the Representatives for each of the other
Underwriters has been declared effective by the Commission in such form;
other than a registration statement, if any, increasing the size of the
offering (a "Rule 462(b) Registration Statement"), filed pursuant to Rule
462(b) under the Securities Act of 1933, as amended (the "Act"), which became
effective upon filing, no other document with respect to the Initial
Registration Statement or document incorporated by reference therein has
heretofore been filed, or transmitted for filing, with the Commission (other
than prospectuses filed pursuant to Rule 424(b) of the rules and regulations
of the Commission under the Act, each in the form heretofore delivered to the
Representatives); and no stop order suspending the effectiveness of the
Initial Registration Statement, any post-effective amendment thereto or the
Rule 462(b) Registration Statement, if any, has been issued and no proceeding
for that purpose has been initiated or, to the knowledge of the Company,
threatened by the Commission (any preliminary prospectus included in the
Initial Registration Statement or filed with the Commission pursuant to Rule
424(a) under the Act is hereinafter called a "Preliminary Prospectus"; the
various parts of the Initial Registration Statement and the Rule 462(b)
Registration Statement, if any, including (i) the information contained in
the form of final prospectus filed with the Commission pursuant to Rule
424(b) under the Act in accordance with Section 5(a) hereof and deemed by
virtue of Rule 430A under the Act to be part of the Initial Registration
Statement at the time it was declared effective or such part of the Rule
462(b) Registration Statement, if any, became or hereafter becomes effective,
(ii) all exhibits thereto and (iii) the documents incorporated by reference
in the prospectus contained in the registration statement at the time such
part of the registration statement became effective but excluding Forms T-1,
each as amended at the time such part of the registration statement became
effective, are hereinafter collectively called the "Registration Statement";
the prospectus relating to the Securities, the Subordinated Debentures and
the Guarantees, in the form in which it has most recently been filed, or
transmitted for filing, with the Commission on or prior to the date of this
Agreement, is hereinafter called the "Prospectus"; any reference herein to
any Preliminary Prospectus or the Prospectus shall be deemed to refer to and
include the documents incorporated by reference therein pursuant to the
applicable form under the Act, as of the date of such Preliminary Prospectus
or Prospectus, as the case may be; any reference to any amendment or
supplement to any Preliminary Prospectus or the Prospectus shall be deemed to
refer to and include any documents filed after the date of such Preliminary
Prospectus or Prospectus, as the case may
3
<PAGE>
be, under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and incorporated by reference in such Preliminary Prospectus or
Prospectus, as the case may be; any reference to any amendment to the
Registration Statement shall be deemed to refer to and include any annual
report of either Trust, if any, and the Company filed pursuant to Section
13(a) or 15(d) of the Exchange Act after the effective date of the
Registration Statement that is incorporated by reference in the Registration
Statement; and any reference to the Prospectus as amended or supplemented
shall be deemed to refer to the Prospectus as amended or supplemented in
relation to the applicable Designated Securities in the form in which it is
filed with the Commission pursuant to Rule 424(b) under the Act in accordance
with Section 5(a) hereof, including any documents incorporated by reference
therein as of the date of such filing);
(b) The documents incorporated by reference in the Prospectus, when they
became effective or were filed with the Commission, as the case may be,
conformed in all material respects to the requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of the Commission
thereunder, and none of such documents 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; and any
further documents so filed and incorporated by reference in the Prospectus or
any further amendment or supplement thereto, when such documents become
effective or are filed with the Commission, as the case may be, will conform
in all material respects to the requirements of the Act or the Exchange Act,
as applicable, and the rules and regulations of the Commission thereunder and
will not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; provided, however, that this
representation and warranty shall not apply to any statements or omissions
made in reliance upon and in conformity with information furnished in writing
to the Designated Trust or the Company by an Underwriter of Designated
Securities through the Representatives expressly for use in the Prospectus as
amended or supplemented relating to such Securities;
(c) The Registration Statement and the Prospectus conform, and any further
amendments or supplements to the Registration Statement or the Prospectus
will conform, in all material respects to the requirements of the Act and the
Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"), and the
rules and regulations of the Commission thereunder and do not and will not,
as of the applicable effective date as to the Registration Statement and any
amendment thereto and as of the applicable filing date as to the Prospectus
and any amendment or supplement thereto, contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Designated Trust or the Company by an
Underwriter of Designated Securities through the Representatives expressly
for use in the Prospectus as amended or supplemented relating to such
Securities;
(d) Neither the Company nor any of the Company's subsidiaries has
sustained since the date of the latest audited financial statements included
or incorporated by reference in the
4
<PAGE>
Prospectus any loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance, or from any
labor dispute or court or governmental action, order or decree, other than
any such loss or interference that would not have a material adverse effect
on or affecting the general affairs, management, financial position,
shareholders' equity or results of operations of the Company and its
subsidiaries taken as a whole, otherwise than as set forth or contemplated in
the Prospectus; and, since the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not been
any material change in the capital stock or long-term debt of the Company or
any of its subsidiaries or any material adverse change in or affecting the
general affairs, management, financial position, shareholders' equity or
results of operations of the Company and its subsidiaries taken as a whole,
otherwise than as set forth or contemplated in the Prospectus;
(e) The Designated Trust has been duly created and is validly existing as
a business trust in good standing under the laws of the State of Delaware,
with power and authority to own, lease and operate its properties and conduct
its business as described in the Prospectus; the Company has been duly
incorporated and is validly existing as a corporation in good standing under
the laws of the State of New York, with power and authority (corporate and
other) to own, lease and operate its properties and conduct its business as
described in the Prospectus;
(f) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company have
been duly and validly authorized and issued and are fully paid and non-
assessable; all the outstanding beneficial interests in the Designated Trust
have been duly and validly authorized and issued, are fully paid and non-
assessable and conform to the descriptions thereof contained in the
Prospectus;
(g) Each of American Express Travel Related Services Company, Inc.,
American Express Financial Corporation and American Express Bank Ltd. (the
"Significant Subsidiaties"), has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the jurisdiction
of its incorporation, has power and authority (corporate and other) to own,
lease and operate its properties and to conduct its business as described in
the Prospectus, and is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure to so qualify
or be in good standing would not have a material adverse effect on the
condition, financial or otherwise, or the earnings or business affairs of the
Company and its subsidiaries taken as a whole; and all of the issued and
outstanding capital stock of each Significant Subsidiary has been duly
authorized and validly issued, is fully paid and non-assessable and all such
shares owned by the Company, directly or through subsidiaries, are owned free
and clear of any security interest, mortgage, pledge, lien, encumbrance,
claim or security.
(h) The Designated Securities have been duly and validly authorized, and,
when the Firm Designated Securities are issued and delivered pursuant to this
Agreement and the Pricing Agreement with respect to such Designated
Securities and, in the case of any Optional
5
<PAGE>
Designated Securities, pursuant to Over-allotment Options (as defined in
Section 3 hereof) with respect to such Securities, such Designated Securities
will be duly and validly issued and fully paid and non-assessable beneficial
interests in the Designated Trust entitled to the benefits provided by the
applicable Trust Agreement, which will be substantially in the form filed as
an exhibit to the Registration Statement; the Designated Securities conform
to the description thereof contained in the Registration Statement and the
Designated Securities will conform to the description thereof contained in
the Prospectus as amended or supplemented with respect to such Designated
Securities;
(i) The holders of the Designated Securities (the "Securityholders") 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;
(j) The Common Securities of the Designated Trust have been duly
authorized on behalf of the Designated Trust by the Company, as depositor of
the Designated Trust, and upon delivery by the Designated Trust to the
Company against payment therefor as set forth in the Trust Agreement, will be
duly and validly issued and non-assessable beneficial interests in the
Designated Trust and will conform to the description thereof contained in the
Prospectus; the issuance of the Common Securities of the Designated Trust is
not subject to preemptive or other similar rights; the Common Securities
conform to the description thereof contained in the Registration Statement;
and at each Time of Delivery (as defined in Section 4 hereof), all of the
issued and outstanding Common Securities of the Designated Trust will be
directly owned by the Company free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity;
(k) The Designated Guarantee, the Agreement as to Expenses and Liabilities
between the Company and the Designated Trust set forth in the Pricing
Agreement (the "Designated Expense Agreement") (all such Designated Expense
Agreements together, the "Expense Agreements") the Trust Agreement for the
Designated Trust, the Designated Subordinated Debentures and the Indenture
(the Designated Guarantee, the Designated Expense Agreement, such Trust
Agreement, the Designated Subordinated Debentures and the Indenture being
collectively referred to as the "Company Agreements") have each been duly
authorized and when validly executed and delivered by the Company and, in the
case of the Designated Guarantee, by the Guarantee Trustee (as defined in the
Guarantee), in the case of the Designated Expense Agreement, by the
Designated Trust, in the case of the Trust Agreement, by the Trustees (as
defined in the Trust Agreement) and, in the case of the Indenture, by the
Indenture Trustee, and, in the case of the Company Subordinated Debentures,
when validly issued by the Company and duly authenticated and delivered by
the Indenture Trustee, will constitute valid and legally binding obligations
of the Company, enforceable in accordance with their respective terms,
subject, as to enforcement, to bankruptcy, insolvency, reorganization and
other laws of general applicability relating to or affecting creditors'
rights and to general equity principles; the Trust Agreement, the Indenture
and the Designated Guarantee have each been duly qualified under the Trust
Indenture Act; the Designated Subordinated Debentures are entitled to the
benefits of the Indenture; and the Company Agreements, which will be in
substantially the form filed as exhibits to the Registration Statement, will
conform to the
6
<PAGE>
descriptions thereof in the Prospectus as amended or supplemented with
respect to the Designated Securities to which they relate;
(l) The issue and sale of the Designated Securities by the Designated
Trust, the compliance by the Designated Trust with all of the provisions of
this Agreement, any Pricing Agreement and each Over-allotment Option, if any,
the Designated Securities, the Designated Expense Agreement and the Trust
Agreement, the purchase of the Designated Subordinated Debentures by the
Designated Trust, the execution, delivery and performance by the Designated
Trust of the Trust Agreement and the consummation of the transactions
contemplated herein and therein will not conflict with or result in a breach
or violation of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which such Trust is a party or by which such Trust
is bound or to which any of the property or assets of such Trust is subject,
nor will such action result in any violation of the provisions of the Trust
Agreement or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over such Trust or any of its
properties; and no consent, approval, authorization, order, registration or
qualification of or with any such court or governmental agency or body is
required for the issue and sale of the Designated Securities and the Common
Securities by such Trust, the purchase of the Subordinated Debentures by the
such Trust or the consummation by such Trust of the transactions contemplated
by this Agreement, the Pricing Agreement or any Over-allotment Option, the
Designated Expense Agreement or the Trust Agreement, except such as have
been, or will have been, prior to each Time of Delivery, obtained under the
Act and the Trust Indenture Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under state securities or
Blue Sky laws in connection with the purchase and distribution of the
Designated Securities by the Underwriters;
(m) The issuance by the Company of the Guarantees and the Subordinated
Debentures, the compliance by the Company with all of the provisions of this
Agreement, any Pricing Agreement and each Over-allotment Option, if any, the
Guarantees, the Expense Agreements, the Subordinated Debentures, the Trust
Agreements and the Indenture, the execution, delivery and performance by the
Company of the Company Agreements, and the consummation of the transactions
contemplated herein and therein will not conflict with or result in a breach
or violation of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company or any of its subsidiaries is a
party or by which the Company or any of its subsidiaries is bound or to which
any of the property or assets of the Company or any of its subsidiaries is
subject, other than any such conflict, breach or violation that would not
have a material adverse effect on or affecting the general affairs,
management, financial position, shareholders' equity or results of operations
of the Company and its subsidiaries taken as a whole, nor will such action
result in any violation of the provisions of the Restated Certificate of
Incorporation or By-Laws of the Company or any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction
over the Company or any of its properties; and no consent, approval,
authorization, order, registration or qualification of or with any such court
or governmental agency or body is required for the issue of the Guarantees or
the Subordinated Debentures or the consummation by the Company of the other
transactions contemplated by this Agreement, any Pricing Agreement or the
7
<PAGE>
Company Agreements, except such as have been or will have been, prior to each
Time of Delivery, obtained under the Act or the Trust Indenture Act and such
consents, approvals, authorizations, registrations or qualifications as may
be required under state securities or Blue Sky laws in connection with the
issuance by the Company of the Guarantees and the Subordinated Debentures;
(n) Other than as set forth in the Prospectus, there are no legal or
governmental proceedings pending to which the Designated Trust, the Company
or any of its subsidiaries is a party or of which any of their properties is
the subject, which, if determined adversely to the Designated Trust, the
Company or any of its subsidiaries, would individually or in the aggregate
have a material adverse effect on the current or future consolidated
financial position, shareholders' equity or results of operations of the
Designated Trust, the Company and its subsidiaries taken as a whole; and, to
the best of the Designated Trust's and the Company's knowledge, no such
proceedings are threatened or contemplated by governmental authorities or
threatened by others;
(o) None of the Designated Trust, the Company nor any of its subsidiaries,
as applicable, is in violation of the Trust Agreement for the Designated
Trust, the Certificate of Trust for the Designated Trust, the Restated
Certificate of Incorporation or By-Laws of the Company, or the charter or by-
laws of any of its subsidiaries or in default in the performance or
observance of any material obligation, agreement, covenant or condition
contained in any indenture, mortgage, deed of trust, loan agreement, lease or
other agreement or instrument to which it is a party or by which it or any of
its properties may be bound, other than any such violation or default that
would not have a material adverse effect on or affecting the general affairs,
management, financial position, shareholders' equity or results of operations
of the Company and its subsidiaries taken as a whole;
(p) The Company and its subsidiaries possess such certificates,
authorities or permits issued by the appropriate state, federal or foreign
regulatory agencies or bodies necessary to conduct the business now operated
by them, except where the failure to possess such certificates, authorities
or permits would not have a material adverse effect on the condition,
financial or otherwise, or the earnings or business affairs of the Company
and its subsidiaries taken as a whole; and neither the Company nor any of its
subsidiaries has received any notice of proceedings relating to the
revocation or modification of any such certificate, authority or permit
which, singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would materially and adversely affect the condition,
financial or otherwise, or the earnings or business affairs of the Company
and its subsidiaries taken as a whole;
(q) The financial statements of the Company and its consolidated
subsidiaries included or incorporated by reference in the Registration
Statement and the Prospectus present fairly in all material respects the
consolidated financial position of the Company and its consolidated
subsidiaries as of the dates indicated and the consolidated results of their
operations for the periods specified; and, except as stated therein, said
financial statements have been prepared in conformity with generally accepted
accounting principles in the United States applied on a consistent basis;
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(r) The statements set forth in (i) the Prospectus under the captions
"Description of Junior Subordinated Debentures", "Description of Capital
Securities", "Description of Guarantees", "The Expense Agreements" and
"Relationship Among the Capital Securities, the Corresponding Junior
Subordinated Debentures, the Expense Agreements and the Guarantees", and (ii)
in the Prospectus as amended or supplemented under the captions "Certain
Terms of Capital Securities", "Certain Terms of Subordinated Debentures" and
"Certain Terms of Guarantee", insofar as they constitute a summary of the
terms of the Securities, Subordinated Debentures, the Guarantee, the Expense
Agreement and the Company Agreements (including the Designated Securities,
the Designated Subordinated Debentures, the Designated Guarantees and the
Designated Expense Agreements), and (x) in the Prospectus under the caption
"Plan of Distribution" and (y) in the Prospectus as amended or supplemented
under the caption "Underwriting", insofar they purport to describe the
provisions of the laws and documents referred to therein, in each case are
accurate, complete and fair;
(s) Neither the Designated Trust nor the Company is or, after giving
effect to the offering and sale of the Securities, will be, an "investment
company" or an entity "controlled" by an "investment company", as such terms
are defined in the Investment Company Act of 1940, as amended (the
"Investment Company Act");
(t) Ernst & Young LLP, who have certified certain financial statements of
the Company and its subsidiaries, are independent public accountants as
required by the Act and the rules and regulations of the Commission
thereunder; and
(u) The Pricing Agreement with respect to the Designated Securities
(incorporating the provisions hereof) and this Agreement each have been duly
authorized, executed and delivered by the Company and the Designated Trust.
3. Upon the execution of the Pricing Agreement applicable to any Designated
Securities and authorization by the Representatives of the release of the Firm
Designated Securities, the several Underwriters propose to offer the Firm
Designated Securities for sale upon the terms and conditions set forth in the
Prospectus as amended or supplemented.
The Designated Trust may specify in the Pricing Agreement applicable to any
Designated Securities that the Designated Trust thereby grants to the
Underwriters the right (an "Over-allotment Option") to purchase at their
election up to the number of Optional Designated Securities set forth in such
Pricing Agreement, on the terms set forth in the paragraph above, for the sole
purpose of covering over-allotments in the sale of the Firm Designated
Securities. Any such election to purchase Optional Designated Securities may be
exercised by written notice from the Representatives to the Designated Trust and
the Company, given within a period specified in the Pricing Agreement, setting
forth the aggregate number of Optional Designated Securities to be purchased and
the date on which such Optional Designated Securities are to be delivered, as
determined by the Representatives but in no event earlier than the First Time of
Delivery (as defined in Section 4 hereof) or, unless the Representatives, the
Designated Trust and the Company otherwise agree in writing, earlier than or
later than the respective number of business days after the date of such notice
set forth in such Pricing Agreement.
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The number of Optional Designated Securities to be added to the number of
Firm Designated Securities to be purchased by each Underwriter as set forth in
Schedule I to the Pricing Agreement applicable to such Designated Securities
shall be, in each case, the number of Optional Designated Securities which the
Designated Trust and the Company have been advised by the Representatives have
been attributed to such Underwriter; provided that, if the Designated Trust and
the Company have not been so advised, the number of Optional Designated
Securities to be so added shall be, in each case, that proportion of Optional
Designated Securities which the number of Firm Designated Securities to be
purchased by such Underwriter under such Pricing Agreement bears to the
aggregate number of Firm Designated Securities (rounded as the Representatives
may determine to the nearest 100 securities). The total number of Designated
Securities to be purchased by all the Underwriters pursuant to such Pricing
Agreement shall be the aggregate number of Firm Designated Securities set forth
in Schedule I to such Pricing Agreement plus the aggregate number of Optional
Designated Securities which the Underwriters elect to purchase.
As compensation to the Underwriters of the Designated Securities for their
commitments hereunder and under the Pricing Agreement, and in view of the fact
that the proceeds of the sale of the Designated Securities will be used by the
Designated Trust to purchase the Designated Subordinated Debentures of the
Company, the Company agrees to pay at each Time of Delivery to Goldman, Sachs &
Co., for the accounts of the several Underwriters, the amount set forth in the
Pricing Agreement per capital security for the Designated Securities to be
delivered at each Time of Delivery.
4. Certificates for the Firm Designated Securities and the Optional
Designated Securities to be purchased by each Underwriter pursuant to the
Pricing Agreement relating thereto, in the form specified in such Pricing
Agreement, and in such authorized denominations and registered in such names as
the Representatives may request upon at least two business days' prior notice to
the Designated Trust and the Company, shall be delivered by or on behalf of the
Designated Trust to the Representatives for the account of such Underwriter,
against payment by such Underwriter or on its behalf of the purchase price
therefor by wire transfer of Federal (same day) Funds to an account designated
by the Designated Trust, (i) with respect to the Firm Designated Securities, all
in the manner and at the place and time and date specified in such Pricing
Agreement or at such other place and time and date as the Representatives, the
Designated Trust and the Company may agree upon in writing, such time and date
being herein called the "First Time of Delivery" and (ii) with respect to the
Optional Designated Securities, if any, in the manner and at the time and date
specified by the Representatives in the written notice given by the
Representatives of the Underwriters' election to purchase such Optional
Designated Securities, or at such other time and date as the Representatives,
the Designated Trust and the Company may agree upon in writing, such time and
date, if not the First Time of Delivery, being herein called the "Second Time of
Delivery". Each such time and date for delivery is herein called a "Time of
Delivery".
5. The Designated Trust and the Company, jointly and severally, agree with
each of the Underwriters of any Designated Securities:
(a) To prepare the Prospectus as amended and supplemented in relation to
such Designated Securities in a form approved by the Representatives and to
file such Prospectus
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pursuant to Rule 424(b) under the Act not later than the Commission's close
of business on the second business day following the execution and delivery
of the Pricing Agreement relating to the Designated Securities or, if
applicable, such earlier time as may be required by Rule 424(b); to make no
further amendment or any supplement to the Registration Statement or
Prospectus as amended or supplemented after the date of the Pricing Agreement
relating to such Securities and prior to any Time of Delivery for such
Securities which shall be disapproved by the Representatives for such
Securities promptly after reasonable notice thereof; to advise the
Representatives promptly of any such amendment or supplement after any Time
of Delivery for the Designated Securities and furnish the Representatives
with copies thereof; to file promptly all reports and any definitive proxy or
information statements required to be filed by the Designated Trust or the
Company with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of
the Exchange Act for so long as the delivery of a prospectus is required in
connection with the offering or sale of the Designated Securities, and during
such same period to advise the Representatives, promptly after it receives
notice thereof, of the time when any amendment to the Registration Statement
has been filed or becomes effective or any supplement to the Prospectus or
any amended Prospectus has been filed with the Commission, of the issuance by
the Commission of any stop order or of any order preventing or suspending the
use of any prospectus relating to the Securities, of the suspension of the
qualification of the Designated Securities or the Designated Subordinated
Debentures for offering or sale in any jurisdiction, of the initiation or
threatening of any proceeding for any such purpose, or of any request by the
Commission for the amending or supplementing of the Registration Statement or
Prospectus or for additional information; and, in the event of the issuance
of any such stop order or of any such order preventing or suspending the use
of any prospectus relating to the Securities or suspending any such
qualification, promptly to use its best efforts to obtain the withdrawal of
such order;
(b) Promptly from time to time to take such action as the Representatives
may reasonably request to qualify such Designated Securities or the
Designated Subordinated Debentures for offering and sale under the securities
laws of such jurisdictions as the Representatives may reasonably request and
to comply with such laws so as to permit the continuance of sales and
dealings therein in such jurisdictions for as long as may be necessary to
complete the distribution of such Designated Securities, provided that in
connection therewith neither the Designated Trust nor the Company shall be
required to qualify as a foreign corporation or to file a general consent to
service of process in any jurisdiction;
(c) Prior to 10:00 a.m., New York City time, on the New York Business Day
next succeeding the date of the Pricing Agreement for such Designated
Securities or some other day as agreed by the Company and the Underwriters
and from time to time thereafter, to furnish the Underwriters with copies of
the Prospectus in New York City as amended or supplemented in such quantities
as the Representatives may reasonably request, and, if the delivery of a
prospectus is required at any time in connection with the offering or sale of
the Designated Securities or the Designated Subordinated Debentures and if at
such time any event shall have occurred as a result of which the Prospectus
as then amended or supplemented would include an untrue statement of a
material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made
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<PAGE>
when such Prospectus is delivered, not misleading, or, if for any other
reason it shall be necessary during such same period to amend or supplement
the Prospectus or to file under the Exchange Act any document incorporated by
reference in the Prospectus in order to comply with the Act, the Exchange Act
or the Trust Indenture Act, to notify the Representatives and upon their
request to file such document and to prepare and furnish without charge to
each Underwriter and to any dealer in securities as many copies as the
Representatives may from time to time reasonably request of an amended
Prospectus or a supplement to the Prospectus which will correct such
statement or omission or effect such compliance;
(d) In the case of the Company, to make generally available to its
security holders as soon as practicable, but in any event not later than
eighteen months after the effective date of the Registration Statement (as
defined in Rule 158(c) under the Act), an earnings statement of the Company
and its subsidiaries (which need not be audited) complying with Section 11(a)
of the Act and the rules and regulations of the Commission thereunder
(including, at the option of the Company, Rule 158);
(e) During the period beginning from the date of the Pricing Agreement for
such Designated Securities and continuing to and including the later of (i)
the termination of trading restrictions for such Designated Securities, as
notified to the Designated Trust and the Company by the Representatives and
(ii) 30 days after the last Time of Delivery for such Designated Securities,
not to offer, sell, contract to sell or otherwise dispose of, except as
provided hereunder, any Securities, any other beneficial interests in the
assets of any Trust, or any capital securities or any other securities of any
Trust or the Company, as the case may be, that are substantially similar to
such Designated Securities (including any guarantee of such securities) or
any securities that are convertible into or exchangeable for, or that
represent the right to receive securities, capital securities or any such
substantially similar securities of any Trust or the Company without
the prior written consent of the Representatives;
(f) In the case of the Company, to issue the Guarantee concurrently with
the issue and sale of the Securities as contemplated herein or in the Pricing
Agreement; and
(g) If the Trust and the Company elect to rely upon Rule 462(b), the Trust
and the Company shall file a Rule 462(b) Registration Statement with the
Commission in compliance with Rule 462(b) by 10:00 P.M., Washington, D.C.
time, on the date of this Agreement, and the Trust and the Company shall at
the time of filing either pay to the Commission the filing fee for the rule
462(b) Registration Statement or give irrevocable instructions for the
payment of such fee pursuant to Rule 111(b) under the Act.
6. The Company covenants and agrees with the several Underwriters that it
will pay or cause to be paid the following: (i) the fees, disbursements and
expenses of the Company's counsel and accountants in connection with the
registration of the Securities, the Guarantees and the Subordinated Debentures
under the Act and all other expenses in connection with the preparation,
printing and filing of the Registration Statement, any Preliminary Prospectus
and the Prospectus and amendments and supplements thereto and the mailing and
delivering of copies thereof to the
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Underwriters and dealers; (ii) the cost of printing or producing any Agreement
among Underwriters, this Agreement, any Pricing Agreement, any Company
Agreement, the Securities and the Subordinated Debentures, any Blue Sky
Memorandum, closing documents (including any compilations thereof) and any other
documents in connection with the offering, purchase, sale and delivery of the
Securities; (iii) all expenses in connection with the qualification of the
Securities, the Guarantees and the Subordinated Debentures for offering and sale
under state securities laws as provided in Section 5(b) hereof, including the
fees and disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky survey(s); (iv) any fees
charged by securities rating services for rating the Securities and the
Subordinated Debentures; (v) any filing fees incident to, and the fees and
disbursements of counsel for the Underwriters in connection with, any required
reviews by the National Association of Securities Dealers, Inc. of the terms of
the sale of the Securities and the issuance of the Guarantees and the
Subordinated Debentures; (vi) the cost of preparing the Securities and the
Subordinated Debentures; (vii) the fees and expenses of any Trustee, Indenture
Trustee and Guarantee Trustee, and any agent of any trustee and the fees and
disbursements of counsel for any trustee in connection with any Trust Agreement,
Indenture, Guarantee and the Securities; (viii) the cost of qualifying the
Securities with The Depository Trust Company; (ix) any fees and expenses in
connection with listing the Securities and the Subordinated Debentures and the
cost of registering the Securities under Section 12 of the Exchange Act; and (x)
all other costs and expenses incident to the performance of its obligations
hereunder and under any Over-allotment Options which are not otherwise
specifically provided for in this Section. It is understood, however, that,
except as provided in this Section, and Sections 8 and 11 hereof, the
Underwriters will pay all of their own costs and expenses, including the fees of
their counsel, transfer taxes on resale of any of the Securities by them, and
any advertising expenses connected with any offers they may make.
7. The obligations of the Underwriters of any Designated Securities under the
Pricing Agreement relating to such Designated Securities shall be subject, in
the discretion of the Representatives, to the condition that all representations
and warranties and other statements of the Designated Trust and the Company in
or incorporated by reference in the Pricing Agreement relating to such
Designated Securities are, at and as of each Time of Delivery for such
Designated Securities, true and correct, the condition that the Designated Trust
and the Company shall have performed all of their respective obligations
hereunder theretofore to be performed, and the following additional conditions:
(a) The Prospectus as amended or supplemented in relation to such
Designated Securities shall have been filed with the Commission pursuant to
Rule 424(b) within the applicable time period prescribed for such filing by
the rules and regulations under the Act and in accordance with Section 5(a)
hereof; if the Trust and the Company have elected to rely upon Rule 462(b),
the Rule 462(b) Registration Statement shall have become effective by 10:00
P.M., Washington, D.C. time, on the date of this Agreement; no stop order
suspending the effectiveness of the Registration Statement or any part
thereof shall have been issued and no proceeding for that purpose shall have
been initiated or, to the knowledge of the Company, threatened by the
Commission; and all requests for additional information on the part of the
Commission shall have been complied with to the Representatives' reasonable
satisfaction;
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<PAGE>
(b) Counsel for the Underwriters shall have furnished to the
Representatives such opinion or opinions (a draft of each such opinion is
attached as Annex III(a) hereto), dated each Time of Delivery for such
Designated Securities, with respect to the incorporation of the Company, the
validity of the Designated Subordinated Debentures and the Designated
Guarantee, the Registration Statement, the Prospectus as amended or
supplemented, as well as such other related matters as the Representatives
may reasonably request, and such counsel shall have received such papers and
information as they may reasonably request to enable them to pass upon such
matters;
(c) Louise M. Parent, Executive Vice President and General Counsel of the
Company, shall have furnished to the Representatives her written opinion (a
draft of such opinion is attached as Annex III(b) hereto), dated each Time of
Delivery for such Designated Securities, respectively, in form and substance
satisfactory to the Representatives, to the effect that:
(i) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of New York,
and each Significant Subsidiary has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, with power and authority (corporate and
other) to own, lease and operate its properties and conduct its business
as described in the Prospectus as amended or supplemented;
(ii) The Company has an authorized capitalization as set forth in the
Prospectus as amended or supplemented, and all of the issued shares of
capital stock of the Company have been duly and validly authorized and
issued and are fully paid and non-assessable; the Designated Securities
have been duly authorized by the Company as depositor on behalf of the
Designated Trust; and the Designated Securities conform to the description
of the Securities contained in the Prospectus as amended or supplemented;
(iii) To the best of such counsel's knowledge and other than as set
forth in the Prospectus, there are no legal or governmental proceedings
pending to which the Company or any of its subsidiaries is a party or of
which any property of the Company or any of its subsidiaries is the
subject which, if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a material
adverse effect on the consolidated financial position, shareholders'
equity or results of operations of the Company and its subsidiaries taken
as a whole; to the best of such counsel's knowledge, there are no legal or
governmental proceedings pending to which the Designated Trust is a party
or of which any property of the Designated Trust is the subject; and to
the best of such counsel's knowledge, no such proceedings are threatened
or contemplated by governmental authorities or threatened by others;
- --------------------
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(iv) This Agreement and the Pricing Agreement with respect to the
Designated Securities have been duly authorized, executed and delivered by
the Designated Trust and the Company;
(v) The issuance by the Company of the Designated Guarantee and the
Designated Subordinated Debentures, the compliance by the Company with all
of the provisions of this Agreement and the Pricing Agreement and the
Company Agreements, the execution, delivery and performance by the Company
of the Company Agreements and the consummation of the transactions herein
and therein contemplated will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument known to such counsel to which the Company or any
of its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject other than any such
conflict, breach or violation that would not have a material adverse
effect on or affecting the general affairs, management, financial
position, shareholders' equity or results of operations of the Company and
its subsidiaries taken as a whole, nor will such actions result in any
violation of any statute or any order, rule or regulation known to such
counsel of any court or governmental agency or body having jurisdiction
over the Designated Trust or the Company or any of their properties;
(vi) No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body is
required for the issue and sale of the Designated Securities being
delivered at such Time of Delivery or the issuance of the Designated
Guarantee and the Designated Subordinated Debentures or the consummation
by the Designated Trust or the Company of the transactions contemplated by
this Agreement or such Pricing Agreement and the Company Agreements,
except such as have been obtained under the Act and the Trust Indenture
Act and such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky laws
in connection with the purchase and distribution of the Designated
Securities by the Underwriters or the issuance of the Designated Guarantee
and Designated Subordinated Debentures by the Company;
(vii) To the best of such counsel's knowledge, neither the Company
nor any of its subsidiaries is in violation of its charter or by-laws or
in default in the performance or observance of any material obligation,
agreement, covenant or condition contained in any indenture, mortgage,
deed of trust, loan agreement, lease or other agreement or instrument of
which it is a party or by which it or any of its properties may be bound,
other than any such violation or default that would not have a material
adverse effect on or affecting the general affairs, management, financial
position, shareholders' equity or results of operations of the Company and
its subsidiaries taken as a whole; the Designated Trust is not in
violation of its Trust Agreement or in default in the performance or
observance of any material obligation, agreement, covenant or condition
contained in any indenture, mortgage, deed of trust, loan agreement, lease
or other agreement or instrument to which it is a party or by which it or
any of its properties may be bound;
(viii) The statements set forth (i) in the Prospectus under the
captions "Description of Junior Subordinated Debentures", "Description of
Capital Securities", "Description of Guarantees", "The Expense Agreements"
and "Relationship Among the Capital Securities,
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<PAGE>
the Corresponding Junior Subordinated Debentures, the Expense Agreements
and the Guarantees", and (ii) in the Prospectus as amended or supplemented
under the captions "Certain Terms of Capital Securities", "Certain Terms
of Subordinated Debentures" and "Certain Terms of Guarantee",
insofar as they constitute a summary of the terms of the Securities,
Subordinated Debentures, the Guarantees, the Expense Agreements and the
Company Agreements (including the Designated Securities, the Designated
Subordinated Debentures, the Designated Guarantee and the Designated
Expense Agreement), and (x) in the Prospectus under the caption "Plan of
Distribution" and (y) in the Prospectus as amended or supplemented under
the caption "Underwriting", insofar as they purport to describe the
provisions of the laws and documents referred to therein, in each case are
accurate, complete and fair;
(ix) The Designated Subordinated Debentures are in the form
prescribed in or pursuant to the Indenture, have been duly and validly
authorized by the Company by all necessary corporate action and, when
completed, executed and authenticated as specified in or pursuant to the
Indenture and issued and delivered, will be valid and binding obligations
of the Company, enforceable in accordance with their terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization and other laws of
general applicability relating to or affecting creditors' rights and to
general equity principles;
(x) The Company Agreements have each been duly authorized, executed
and delivered by the parties thereto and constitute valid and legally
binding instruments, enforceable in accordance with their respective
terms, subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or
affecting creditors' rights and to general equity principles; and the
Indenture, the Designated Guarantee and the Designated Trust Agreement
have been duly qualified under the Trust Indenture Act;
(xi) The issuance by the Company of the Guarantee and the
Subordinated Debentures, the compliance by the Company with all of the
provisions of this Agreement and the Pricing Agreement and the Company
Agreements, the execution, delivery and performance by the Company of the
Company Agreements and the consummation of the transactions herein and
therein contemplated will not result in any violation of the provisions of
the Company's Restated Certificate of Incorporation or By-Laws;
(xii) The Designated Trust is not an "investment company" or an
entity "controlled" by an "investment company", as such terms are defined
in the Investment Company Act;
(xiii) The documents incorporated by reference in the Prospectus as
amended or supplemented (other than the financial statements and related
schedules therein, as to which such counsel need express no opinion), when
they became effective or were filed with the Commission, as the case may
be, complied as to form in all material respects with the requirements of
the Act or the Exchange Act, as applicable, and the rules and regulations
of the Commission thereunder; and such counsel has no reason to believe
that any of such documents, when they became effective or were so filed,
as the case may be,
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contained, in the case of a registration statement which became effective
under the Act, 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, in the case of other documents
which were filed under the Act or the Exchange Act with the Commission, an
untrue statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made when such documents were so
filed, not misleading; and
(xiv) The Registration Statement and the Prospectus as amended or
supplemented, and any further amendments and supplements thereto made by
the Designated Trust or the Company prior to such Time of Delivery (other
than the financial statements and related schedules therein, as to which
such counsel need express no opinion), comply as to form in all material
respects with the requirements of the Act and the rules and regulations
thereunder; although they do not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement or the Prospectus, except for those referred to in
the opinion in subsection (viii) of this Section 7(c), such counsel has no
reason to believe that, as of its effective date, the Registration
Statement or any further amendment thereto made by the Designated Trust or
the Company prior to such Time of Delivery (other than the financial
statements and related schedules therein, as to which such counsel need
express no opinion) 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, as of its
date, the Prospectus as amended or supplemented or any further amendment
or supplement thereto made by the Designated Trust or the Company prior to
such Time of Delivery (other than the financial statements and related
schedules therein, as to which such counsel need express no opinion)
contained an untrue statement of a material fact or omitted to state a
material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading or that, as
of such Time of Delivery, either the Registration Statement or the
Prospectus as amended or supplemented or any further amendment or
supplement thereto made by the Designated Trust or the Company prior to
such Time of Delivery (other than the financial statements and related
schedules therein, as to which such counsel need express no opinion)
contains an untrue statement of a material fact or omits to state a
material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading; and they do
not know of any amendment to the Registration Statement required to be
filed or any contracts or other documents of a character required to be
filed as an exhibit to the Registration Statement or required to be
incorporated by reference into the Prospectus as amended or supplemented
or required to be described in the Registration Statement or the
Prospectus as amended or supplemented which are not filed or incorporated
by reference or described as required;
(d) Special Delaware counsel to the Designated Trust and the Company
satisfactory to the Representatives shall have furnished to the Representatives,
the Company and the Designated Trust their written opinion (a draft of such
opinion is attached as Annex III(c) hereto), dated the respective Time of
Delivery in form and substance satisfactory to the Representatives to the effect
that
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(i) The Designated Trust has been duly created and is validly
existing in good standing as a business trust under the Delaware Business
Trust Act, and all filings required under the laws of the State of
Delaware with respect to the creation and valid existence of the
Designated Trust as a business trust have been made;
(ii) Under the Delaware Business Trust Act and the Trust Agreement,
the Designated Trust has the power and authority to own property and
conduct its business, all as described in the Prospectus;
(iii) The Trust Agreement constitutes a valid and binding
obligation of the Company and the Trustees, enforceable against the
Company and the Trustees, in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, receivership, liquidation,
fraudulent conveyance, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors'
rights to general equity principles, including applicable law relating to
fiduciary duties (regardless of whether considered and applied in a
proceeding in equity or at law), and to the effect of applicable public
policy on the enforceability of provisions relating to indemnification or
contribution;
(iv) Under the Delaware Business Trust Act and the Trust Agreement, the
Designated Trust has the requisite trust power and authority to (a)
execute, deliver and perform its obligations under this Agreement and the
Pricing Agreement and (b) issue and perform its obligations under the
Designated Securities and the Common Securities of the Designated Trust;
(v) Under the Delaware Business Trust Act and the Trust Agreement,
the execution and delivery by the Designated Trust of this Agreement and
the Pricing Agreement, and the performance by the Designated Trust of its
obligations hereunder and thereunder, have been duly authorized by the
requisite trust action on the part of the Designated Trust;
(vi) The Designated Securities have been duly authorized by the Trust
Agreement and are duly and validly issued and, subject to the
qualifications set forth herein, fully paid and non-assessable beneficial
interests in the Designated Trust and are entitled to the benefits
provided by the Trust Agreement; the Securityholders, as beneficial owners
of the Designated 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; provided that such counsel may note that the Securityholders may
be obligated, pursuant to the Trust Agreement, to (a) provide indemnity
and/or security in connection with and pay taxes or governmental charges
arising from transfers or exchanges of Securities Certificates and the
issuance of replacement Securities Certificates and (b) provide security
and indemnity in connection with requests of or directions to the Property
Trustee (as defined in the Trust Agreement) to exercise its rights and
remedies under the Trust Agreement;
(vii) The Common Securities of the Designated Trust have been duly
authorized by the Trust Agreement and are validly issued and represent
beneficial interests in the Designated Trust;
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<PAGE>
(viii) Under the Delaware Business Trust Act and the Trust Agreement,
the issuance of the Designated Securities and the Common Securities of the
Designated Trust is not subject to preemptive rights;
(ix) The issuance and sale by the Designated Trust of Designated
Securities and the Common Securities of the Designated Trust, the
execution, delivery and performance by the Designated Trust of this
Agreement and the Pricing Agreement, the consummation by the Designated
Trust of the transactions contemplated thereby and compliance by the
Designated Trust with its obligations thereunder will not violate (a) any
of the provisions of the Certificate of Trust of the Designated Trust or
the Trust Agreement, or (b) any applicable Delaware law or administrative
regulation;
(x) Assuming that the Designated Trust derives no income from or
connected with sources within the State of Delaware and has no
assets, activities (other than maintaining the Delaware Trustee and the
filing of documents with the Secretary of State of the State of Delaware)
or employees in the State of Delaware, no authorization, approval, consent
or order of any Delaware court or governmental authority or agency is
required to be obtained by the Designated Trust solely in connection with
the issuance and sale of the Designated Securities and the Common
Securities of the Designated Trust. (In rendering the opinion expressed
in this paragraph (x), such counsel need express no opinion concerning the
securities laws of the State of Delaware.); and
(xi) Assuming that the Designated Trust derives no income from or
connected with sources within the State of Delaware and has no
assets, activities (other than maintaining the Delaware Trustee and the
filing of documents with the Secretary of State of the State of Delaware)
or employees in the State of Delaware, the Securityholders (other than
those holders of the Securities who reside or are domiciled in the State
of Delaware) will have no liability for income taxes imposed by the State
of Delaware solely as a result of their participation in the Designated
Trust, and the Designated Trust will not be liable for any income tax
imposed by the State of Delaware;
(xii) Assuming that the Designated Trust derives no income from or
connected with sources within the State of Delaware and has no assets,
activities (other than maintaining the Delaware Trustee and the filing of
documents with the Secretary of State of the State of Delaware) or
employees in the State of Delaware, there are no taxes, fees or other
governmental charges payable by the Designated Trust (or the Trustees of
the Designated Trust on behalf of the Designated Trust) under the laws of
the State of Delaware or any political subdivision thereof in connection
with the execution, delivery and performance by either Trustee of the
Designated Trust of the Trust Agreement;
(e) Tax counsel for the Designated Trust and the Company satisfactory to
the Representatives shall have furnished to the Representatives their written
opinion (a draft of such opinion is attached as Annex III(d) hereto), dated
the respective Time of Delivery, in form and substance satisfactory to the
Representatives, to the effect that such firm confirms its opinion set forth
in the Prospectus under the caption "U.S. Federal Income Tax Consequences";
(f) On the date of the Pricing Agreement for such Designated Securities at
a time prior to the execution of the Pricing Agreement with respect to the
Designated Securities and at each Time of Delivery for such Designated
Securities, Ernst & Young LLP, who have certified the financial statements of
the Company and its subsidiaries included or incorporated by reference in the
Registration Statement, shall have furnished to the Representatives a letter,
dated the effective date of the Registration Statement or the date of the
most recent report filed with the Commission containing financial statements
and incorporated by reference in the
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<PAGE>
Registration Statement, if the date of such report is later than such
effective date, and a letter dated such Time of Delivery, respectively, to
the effect set forth in Annex II hereto, and with respect to such letter
dated such Time of Delivery, as to such other matters as the Representatives
may reasonably request and in form and substance satisfactory to the
Representatives;
(g) (i) None of the Designated Trust, the Company or any of the Company's
subsidiaries shall have sustained since the date of the latest audited
financial statements included or incorporated by reference in the Prospectus
as amended or supplemented prior to the date of the Pricing Agreement
relating to the Designated Securities any loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or governmental
action, order, decree or regulation, otherwise than as set forth or
contemplated in the Prospectus as amended or supplemented prior to the date
of the Pricing Agreement relating to the Designated Securities, and (ii)
since the respective dates as of which information is given in the Prospectus
as amended or supplemented prior to the date of the Pricing Agreement
relating to the Designated Securities there shall not have been any change in
the capital stock or long-term debt of the Company or any of its subsidiaries
or any change, or any development involving a prospective change, in or
affecting the general affairs, management, financial position, shareholders'
equity or results of operations of the Company and its subsidiaries,
otherwise than as set forth or contemplated in the Prospectus as amended or
supplemented prior to the date of the Pricing Agreement relating to the
Designated Securities, the effect of which, in any such case described in
Clause (i) or (ii), is in the judgment of the Representatives so material and
adverse as to make it impracticable or inadvisable to proceed with the public
offering or the delivery of the Firm Designated Securities or Optional
Designated Securities or both on the terms and in the manner contemplated in
the Prospectus as first amended or supplemented relating to the Designated
Securities;
(h) On or after the date of the Pricing Agreement relating to the
Designated Securities (i) no downgrading shall have occurred in the rating
accorded the Company's debt securities or preferred stock by any "nationally
recognized statistical rating organization", as that term is defined by the
Commission for purposes of Rule 436(g)(2) under the Act, and (ii) no such
organization shall have publicly announced that it has under surveillance or
review, with possible negative implications, its rating of any of the
Company's debt securities or preferred stock;
(i) On or after the date of the Pricing Agreement relating to the
Designated Securities there shall not have occurred any of the following: (i)
a suspension or material limitation in trading in securities generally on the
New York Stock Exchange; (ii) a suspension or material limitation in trading
in the Company's securities in the over-the-counter market; (iii) a general
moratorium on commercial banking activities declared by either Federal or New
York State authorities; or (iv) the outbreak or escalation of hostilities
involving the United States or the declaration by the United States of a
national emergency or war, if the effect of any such event specified in this
Clause (iv) in the judgment of the Representatives makes it impracticable or
inadvisable to proceed with the public offering or the delivery of the Firm
Designated
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<PAGE>
Securities or Optional Designated Securities or both on the terms and in the
manner contemplated in the Prospectus as first amended or supplemented
relating to the Designated Securities;
(j) The Company shall have complied with the provisions of Section 5(c)
hereof with respect to the furnishing of prospectuses on the New York
Business Day next succeeding the date of the Pricing Agreement for such
Designated Securities or some other day as agreed by the Company and the
Underwriters; and
(k) The Designated Trust and the Company shall have furnished or caused to
be furnished to the Representatives at each Time of Delivery for the
Designated Securities certificates of officers of the Designated Trust and
the Company satisfactory to the Representatives as to the accuracy of the
representations and warranties of the Designated Trust and the Company herein
at and as of such Time of Delivery, as to the performance by the Designated
Trust and the Company of all of its obligations hereunder to be performed at
or prior to such Time of Delivery, as to the matters set forth in subsections
(a) and (h) of this Section and as to such other matters as the
Representatives may reasonably request.
8. (a) The Designated Trust and the Company, jointly and severally, will
indemnify and hold harmless each Underwriter against any losses, claims, damages
or liabilities, joint or several, to which such Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, any preliminary prospectus supplement, the Registration
Statement, the Prospectus as amended or supplemented and any other prospectus
relating to the Designated Securities, or any amendment or supplement thereto,
or arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, and will reimburse each Underwriter for any
legal or other expenses reasonably incurred by such Underwriter in connection
with investigating or defending any such action or claim as such expenses are
incurred; provided, however, that neither the Designated Trust nor the Company
shall be liable in any such case to the extent that any such loss, claim, damage
or liability arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in any Preliminary
Prospectus, any preliminary prospectus supplement, the Registration Statement,
the Prospectus as amended or supplemented and any other prospectus relating to
the Securities, or any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Designated Trust and the
Company by any Underwriter of Designated Securities through the Representatives
expressly for use in the Prospectus as amended or supplemented relating to such
Securities; provided further, that the Company shall not be liable to any
-------- -------
Underwriter under the indemnity agreement in this subsection (a) with respect to
any Preliminary Prospectus to the extent that any such loss, claim, damage or
liability of such Underwriter results from the fact that such Underwriter sold
Designated Securities to a person as to whom it shall be established by the
Company that there was not sent or given, at or prior to the written
confirmation of such sale, a copy of a Prospectus or a Prospectus as then
amended or supplemented in any case where such delivery is required by the Act
if the Company has previously furnished copies thereof in sufficient quantity to
such Underwriter as required by Section 5(c) and the loss, claim, damage or
liability of such Underwriter results from an untrue statement or omission of a
material fact contained in the Preliminary Prospectus which was identified in
writing prior to the date hereof to such Underwriter and corrected in the
Prospectus or in the Prospectus as then amended or supplemented.
(b) Each Underwriter will indemnify and hold harmless the Designated Trust
and the Company against any losses, claims, damages or liabilities to which the
Designated Trust may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Designated Securities, or
any amendment or supplement thereto, or arise out of or
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<PAGE>
are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in any Preliminary Prospectus, any preliminary prospectus supplement, the
Registration Statement, the Prospectus as amended or supplemented and any other
prospectus relating to the Securities, or any such amendment or supplement in
reliance upon and in conformity with written information furnished to the
Designated Trust and the Company by such Underwriter through the Representatives
expressly for use therein; and will reimburse the Designated Trust and the
Company for any legal or other expenses reasonably incurred by the Designated
Trust in connection with investigating or defending any such action or claim as
such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection (a) or
(b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against an indemnifying party
under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify such indemnifying party
shall not relieve it from any liability which it may have to any indemnified
party otherwise than under such subsection. In case any such action shall be
brought against any indemnified party and it shall notify the indemnifying party
of the commencement thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, jointly with any
other indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and,
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal expenses of
other counsel or any other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof other than reasonable
costs of investigation. No indemnifying party shall, without the written
consent of the indemnified party, effect the settlement or compromise of, or
consent to the entry of any judgment with respect to, any pending or threatened
action or claim in respect of which indemnification or contribution may be
sought hereunder (whether or not the indemnified party is an actual or potential
party to such action or claim) unless such settlement, compromise or judgment
(i) includes an unconditional release of the indemnified party from all
liability arising out of such action or claim and (ii) does not include any
statement as to, or an admission of, fault, culpability or a failure to act, by
or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 8 is unavailable to
or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above in respect of any losses, claims, damages or liabilities (or actions
in respect thereof) referred to therein, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (or actions in respect thereof)
in such proportion as is appropriate to reflect the relative benefits received
by the Designated Trust and the Company on the one hand and the Underwriters of
the Designated Securities on the other from the offering of the Designated
Securities to which such loss, claim, damage or liability (or action in respect
thereof) relates. If, however, the allocation provided by the immediately
preceding sentence is not permitted by applicable law or if the indemnified
party failed to give the notice required under
22
<PAGE>
subsection (c) above, then each indemnifying party shall contribute to such
amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Designated Trust and the Company on the one hand and the
Underwriters of the Designated Securities on the other in connection with the
statements or omissions which resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative benefits received by the Designated Trust
and the Company on the one hand and such Underwriters on the other shall be
deemed to be in the same proportion as the total net proceeds from such offering
(before deducting expenses) received by the Designated Trust and the Company
bear to the total underwriting discounts and commissions received by such
Underwriters. The relative fault shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Designated Trust and the Company on the one hand or
such Underwriters on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Designated Trust, the Company and the Underwriters agree that it
would not be just and equitable if contributions pursuant to this subsection (d)
were determined by pro rata allocation (even if the Underwriters were treated as
one entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to above in this
subsection (d). The amount paid or payable by an indemnified party as a result
of the losses, claims, damages or liabilities (or actions in respect thereof)
referred to above in this subsection (d) shall be deemed to include any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this subsection (d), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
the applicable Designated Securities underwritten by it and distributed to the
public were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The obligations of the Underwriters of Designated
Securities in this subsection (d) to contribute are several in proportion to
their respective underwriting obligations with respect to such Securities and
not joint.
(e) The obligations of the Designated Trust and the Company under this
Section 8 shall be in addition to any liability which the Designated Trust and
the Company may otherwise have and shall extend, upon the same terms and
conditions, to each person, if any, who controls any Underwriter within the
meaning of the Act; and the obligations of the Underwriters under this Section 8
shall be in addition to any liability which the respective Underwriters may
otherwise have and shall extend, upon the same terms and conditions, to each
officer and director of the Designated Trust and the Company and to each person,
if any, who controls the Designated Trust and the Company within the meaning of
the Act.
9. (a) If any Underwriter shall default in its obligation to purchase the
Firm Designated Securities or Optional Designated Securities which it has agreed
to purchase under the Pricing Agreement relating to such Securities, the
Representatives may in their discretion arrange for
23
<PAGE>
themselves or another party or other parties to purchase such Securities on the
terms contained herein. If within thirty-six hours after such default by any
Underwriter the Representatives do not arrange for the purchase of such Firm
Designated Securities or Optional Designated Securities, as the case may be,
then the Designated Trust shall be entitled to a further period of thirty-six
hours within which to procure another party or other parties satisfactory to the
Representatives to purchase such Securities on such terms. In the event that,
within the respective prescribed period, the Representatives notify the
Designated Trust that they have so arranged for the purchase of such Securities,
or the Designated Trust notifies the Representatives that it has so arranged for
the purchase of such Securities, the Representatives or the Designated Trust
shall have the right to postpone a Time of Delivery for such Securities for a
period of not more than seven days, in order to effect whatever changes may
thereby be made necessary in the Registration Statement or the Prospectus as
amended or supplemented, or in any other documents or arrangements, and the
Designated Trust agrees to file promptly any amendments or supplements to the
Registration Statement or the Prospectus which in the opinion of the
Representatives may thereby be made necessary. The term "Underwriter" as used in
this Agreement shall include any person substituted under this Section with like
effect as if such person had originally been a party to the Pricing Agreement
with respect to such Designated Securities.
(b) If, after giving effect to any arrangements for the purchase of the Firm
Designated Securities or Optional Designated Securities, as the case may be, of
a defaulting Underwriter or Underwriters by the Representatives and the
Designated Trust as provided in subsection (a) above, the aggregate number of
such Securities which remains unpurchased does not exceed one-eleventh of the
aggregate number of the Firm Designated Securities or Optional Designated
Securities, as the case may be, to be purchased at the respective Time of
Delivery, then the Designated Trust shall have the right to require each non-
defaulting Underwriter to purchase the number of Firm Designated Securities or
Optional Designated Securities, as the case may be, which such Underwriter
agreed to purchase under the Pricing Agreement relating to such Designated
Securities and, in addition, to require each non-defaulting Underwriter to
purchase its pro rata share (based on the number of Firm Designated Securities
or Optional Designated Securities, as the case may be, which such Underwriter
agreed to purchase under such Pricing Agreement) of the Firm Designated
Securities or Optional Designated Securities, as the case may be, of such
defaulting Underwriter or Underwriters for which such arrangements have not been
made; but nothing herein shall relieve a defaulting Underwriter from liability
for its default.
(c) If, after giving effect to any arrangements for the purchase of the Firm
Designated Securities or Optional Designated Securities, as the case may be, of
a defaulting Underwriter or Underwriters by the Representatives and the
Designated Trust as provided in subsection (a) above, the aggregate number of
Firm Designated Securities or Optional Designated Securities, as the case may
be, which remains unpurchased exceeds one-eleventh of the aggregate number of
the Firm Designated Securities or Optional Designated Securities, as the case
may be, to be purchased at the respective Time of Delivery, as referred to in
subsection (b) above, or if the Designated Trust shall not exercise the right
described in subsection (b) above to require non-defaulting Underwriters to
purchase Firm Designated Securities or Optional Designated Securities, as the
case may be, of a defaulting Underwriter or Underwriters, then the Pricing
Agreement relating to such Firm Designated Securities or the Over-allotment
Option relating to such Optional Designated Securities,
24
<PAGE>
as the case may be, shall thereupon terminate, without liability on the part of
any non-defaulting Underwriter or the Designated Trust or the Company, except
for the expenses to be borne by the Designated Trust and the Company and the
Underwriters as provided in Section 6 hereof and the indemnity and contribution
agreements in Section 8 hereof; but nothing herein shall relieve a defaulting
Underwriter from liability for its default.
10. The respective indemnities, agreements, representations, warranties and
other statements of the Designated Trust or the Company and the several
Underwriters, as set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement, shall remain in full force and effect,
regardless of any investigation (or any statement as to the results thereof)
made by or on behalf of any Underwriter or any controlling person of any
Underwriter, or the Designated Trust or the Company, or any officer or director
or controlling person of the Designated Trust or the Company, and shall survive
delivery of and payment for the Securities.
11. If any Pricing Agreement or Over-allotment Option shall be terminated
pursuant to Section 9 hereof, neither the Designated Trust nor the Company shall
then be under any liability to any Underwriter with respect to the Firm
Designated Securities or Optional Designated Securities with respect to which
such Pricing Agreement shall have been terminated except as provided in Sections
6 and 8 hereof; but, if for any other reason Designated Securities are not
delivered by or on behalf of the Designated Trust or the Company as provided
herein, the Company will reimburse the Underwriters through the Representatives
for all out-of-pocket expenses approved in writing by the Representatives,
including fees and disbursements of counsel, reasonably incurred by the
Underwriters in making preparations for the purchase, sale and delivery of such
Designated Securities, but the Designated Trust or the Company shall then be
under no further liability to any Underwriter with respect to such Designated
Securities except as provided in Sections 6 and 8 hereof.
12. In all dealings hereunder, the Representatives of the Underwriters of
Designated Securities shall act on behalf of each of such Underwriters, and the
parties hereto shall be entitled to act and rely upon any statement, request,
notice or agreement on behalf of any Underwriter made or given by such
Representatives jointly or by such of the Representatives, if any, as may be
designated for such purpose in the Pricing Agreement.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Representatives as set forth in the
Pricing Agreement; and if to the Designated Trust or the Company shall be
delivered or sent by mail, telex or facsimile transmission to the address of the
Designated Trust or the Company, respectively, set forth in the Registration
Statement, Attention: Secretary; provided, however, that any notice to an
Underwriter pursuant to Section 8(c) hereof shall be delivered or sent by mail,
telex or facsimile transmission to such Underwriter at its address set forth in
its Underwriters' Questionnaire, or telex constituting such Questionnaire, which
address will be supplied to the Designated Trust and the Company by the
Representatives upon request. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
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<PAGE>
13. This Agreement and each Pricing Agreement shall be binding upon, and
inure solely to the benefit of, the Underwriters, each Designated Trust, the
Company and, to the extent provided in Sections 8 and 10 hereof, the officers
and directors of each Designated Trust, the Company and each person who controls
any Designated Trust or the Company or any Underwriter, and their respective
heirs, executors, administrators, successors and assigns, and no other person
shall acquire or have any right under or by virtue of this Agreement or any such
Pricing Agreement. No purchaser of any of the Securities from any Underwriter
shall be deemed a successor or assign merely by reason of such purchase.
14. Time shall be of the essence of each Pricing Agreement. As used herein,
the term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
15. This Agreement and each Pricing Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
16. This Agreement and each Pricing Agreement may be executed by any one or
more of the parties hereto and thereto in any number of counterparts, each of
which shall be deemed to be an original, but all such respective counterparts
shall together constitute one and the same instrument.
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Very truly yours,
AMERICAN EXPRESS COMPANY
By:
-----------------------
Name:
Title:
AMERICAN EXPRESS COMPANY
CAPITAL TRUST I
By: American Express Company
as Depositor
By:
-----------------------
Name:
Title:
AMERICAN EXPRESS COMPANY
CAPITAL TRUST II
By: American Express Company
as Depositor
By:
-----------------------
Name:
Title:
27
<PAGE>
Pricing Agreement
-----------------
ANNEX I
[Names of Representatives]
As Representatives of the several
Underwriters named in Schedule I hereto,
Date: ____ __, 199_
Ladies and Gentlemen:
American Express Company Capital Trust [I][II], a statutory business trust
formed under the laws of the State of Delaware (the "Designated Trust") and
American Express Company, a New York corporation (the "Company"), propose,
subject to the terms and conditions stated herein and in the Underwriting
Agreement, dated ____ __, 199_ (the "Underwriting Agreement"), to issue and sell
to the Underwriters named in Schedule I hereto (the "Underwriters") the
Securities specified in Schedule II hereto (the "Designated Securities"
consisting of Firm Designated Securities and any Optional Designated Securities
the Underwriters may elect to purchase). The principal asset of the Trust
consists of debt securities of the Company (the "Subordinated Debentures"), as
specified in Schedule II to this Agreement. The Designated Securities will be
guaranteed by the Company to the extent set forth in this Agreement with respect
to such Designated Securities (the "Guarantee"). Each of the provisions of the
Underwriting Agreement is incorporated herein by reference in its entirety, and
shall be deemed to be a part of this Agreement to the same extent as if such
provisions had been set forth in full herein; and each of the representations
and warranties set forth therein shall be deemed to have been made at and as of
the date of this Pricing Agreement, except that each representation and warranty
which refers to the Prospectus in Section 2 of the Underwriting Agreement shall
be deemed to be a representation or warranty as of the date of the Underwriting
Agreement in relation to the Prospectus (as therein defined), and also a
representation and warranty as of the date of this Pricing Agreement in relation
to the Prospectus as amended or supplemented relating to the Designated
Securities which are the subject of this Pricing Agreement. Each reference to
the Representative herein and in the provisions of the Underwriting Agreement so
incorporated by reference shall be deemed to refer to you. Unless otherwise
defined herein, terms defined in the Underwriting Agreement are used herein as
therein defined. The Representative designated to act on behalf of the
Representatives and on behalf of each of the Underwriters of the Designated
Securities pursuant to Section 12 of the Underwriting Agreement and the address
of the Representatives referred to in such Section 12 are set forth at the end
of Schedule II hereto.
An amendment to the Initial Registration Statement or a supplement to the
Prospectus, as the case may be, relating to the Designated Securities, in the
form heretofore delivered to you is now proposed to be filed with the
Commission.
<PAGE>
Subject to the terms and conditions set forth herein and in the Underwriting
Agreement incorporated herein by reference, (a) the Designated Trust agrees to
issue and sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Designated Trust, at the time
and place and at the purchase price to the Underwriters set forth in Schedule II
hereto, the number of Firm Designated Securities set forth opposite the name of
such Underwriter in Schedule I hereto and, (b) in the event and to the extent
that the Underwriters shall exercise the election to purchase Optional
Designated Securities, as provided below, the Designated Trust agrees to issue
and sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Designated Trust at the purchase
price to the Underwriters set forth in Schedule II hereto that portion of the
number of Optional Designated Securities as to which such election shall have
been exercised.
The Designated Trust hereby grants to each of the Underwriters the right to
purchase at their election up to the number of Optional Designated Securities
set forth opposite the name of such Underwriter in Schedule I hereto on the
terms referred to in the paragraph above for the sole purpose of covering over-
allotments in the sale of the Firm Designated Securities. Any such election to
purchase Optional Designated Securities may be exercised by written notice from
the Representatives to the Designated Trust and the Company given within a
period of 30 calendar days after the date of this Pricing Agreement, setting
forth the aggregate number of Optional Designated Securities to be purchased and
the date on which such Optional Designated Securities are to be delivered, as
determined by the Representatives, but in no event earlier than the First Time
of Delivery or, unless the Representatives and the Designated Trust otherwise
agree in writing, no earlier than two or later than ten business days after the
date of such notice.
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If the foregoing is in accordance with your understanding, please sign and
return to us [ ] counterparts hereof, and upon acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such acceptance hereof,
including the provisions of the Underwriting Agreement incorporated herein by
reference, shall constitute a binding agreement between each of the Underwriters
and the Designated Trust and the Company. It is understood that your acceptance
of this letter on behalf of each of the Underwriters is or will be pursuant to
the authority set forth in a form of Agreement among Underwriters, the form of
which shall be submitted to the Designated Trust and the Company for
examination, upon request, but without warranty on the part of the
Representatives as to the authority of the signers thereof.
Very truly yours,
AMERICAN EXPRESS COMPANY
By:
------------------------------
Name:
Title:
AMERICAN EXPRESS COMPANY
CAPITAL TRUST [I] [II]
By: American Express Company
as Depositor
By:
------------------------------
Name:
Title:
Accepted as of the date hereof:
[Names of Representatives]
As Representatives of the Underwriters
named in Schedule I hereto
By:
---------------------------------
3
<PAGE>
SCHEDULE I
<TABLE>
<CAPTION>
Maximum Number
Number of of Optional
Firm Designated
Designated Securities Which
Securities May be
Underwriter to be Purchased Purchased
----------- --------------- ---------
<S> <C> <C>
[Names of Representatives]...................
[Names of other Underwriters]................
Total
</TABLE>
I-1
<PAGE>
SCHEDULE II
Designated Trust:
American Express Company Capital Trust [I][II]
Title of Designated Securities:
[___%] [Floating Rate] Capital Securities, Series ___
Liquidation Amount of the Designated Securities:
$__ per Designated Security
Aggregate principal amount:
Aggregate liquidation amount of Designated
Securities to be sold: $
Price to Public:
___% of the liquidation amount of the Designated Securities
Purchase Price by Underwriters:
_______% of the liquidation amount of the Designated Securities
Underwriters' Compensation:
As compensation to the Underwriters for their commitments hereunder, and in
view of the fact that the proceeds of the sale of the Designated Securities
will be used by the Designated Trust to purchase the Subordinated
Debentures of the Company, the Company hereby agrees to pay at each Time of
Delivery to [the Designated Representative], for the accounts of the
several Underwriters, an amount equal to $ per capital
security for the Designated Securities to be delivered at each Time of
Delivery ($ in the aggregate).
Specified funds for payment of purchase price:
Federal (same day) Funds
Accountants' Letter to be delivered on date of Pricing Agreement:
Yes
II-1
<PAGE>
Trust Agreement:
Amended and Restated Trust Agreement dated as of ____ __, 199_, between the
Company, as Depositor, Bankers Trust Company, as Property Trustee, Bankers
Trust (Delaware), as Delaware Trustee, and the several Holders of Trust
Securities
Indenture:
Indenture dated as of ____ __, 199_, between the Company and Bankers Trust
Company, as Indenture Trustee (the "Indenture")
Guarantee:
Guarantee Agreement dated as of ____ __, 199_, between Company and Bankers
Trust Company, as Guarantee Trustee
Expense Agreement
Agreement as to Expenses and Liabilities, dated as of ____ __, 199_ between
the Company and the Designated Trust
Subordinated Debentures:
[___%] [Floating Rate] Junior Subordinated Debentures, Series ___
Maturity:
________ __, ____ [(subject to shortening such maturity to a date not
earlier than ____ __, ____]
Interest Rate:
Interest Payment Dates:
[March 1, June 1, September 1 and December 1] [June 1 and December 1] of
each year, commencing on _________, ____
Extension Period:
[20 quarters] [10 semi-annual periods]
Redemption Provisions:
II-2
<PAGE>
[The redemption provisions set forth in Section ___ of the Trust Agreement
shall apply to the Designated Securities]
Sinking Fund Provisions:
No sinking fund provisions
Exchange for Designated Securities:
[The Subordinated Debentures may be delivered in exchange for the
Designated Securities as provided in the Prospectus Supplement]
Listing of Designated Securities:
[New York Stock Exchange][None].
Time of Delivery:
_____ a.m., New York City time
____ __, ____
Closing Location:
Names and addresses of Representatives:
[Names of Representatives]
[Address for Notices]
II-3
<PAGE>
ANNEX II
Pursuant to Section 7(f) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with respect to
the Designated Trust and the Company and its subsidiaries within the
meaning of the Act and the applicable published rules and regulations
thereunder;
(ii) In their opinion, the financial statements and any supplementary
financial information and schedules (and, if applicable, financial
forecasts and/or pro forma financial information) examined by them and
included or incorporated by reference in the Registration Statement or the
Prospectus comply as to form in all material respects with the applicable
accounting requirements of the Act or the Exchange Act, as applicable, and
the related published rules and regulations thereunder; and, if applicable,
they have made a review in accordance with standards established by the
American Institute of Certified Public Accountants of the consolidated
interim financial statements, selected financial data, pro forma financial
information, financial forecasts and/or condensed financial statements
derived from audited financial statements of the Company for the periods
specified in such letter, as indicated in their reports thereon, copies of
which have been separately furnished to the representatives of the
Underwriters (the "Representatives");
(iii) They have made a review in accordance with standards established
by the American Institute of Certified Public Accountants of the unaudited
condensed consolidated statements of income, consolidated balance sheets
and consolidated statements of cash flows included in the Prospectus and/or
included in the Company's quarterly reports on Form 10-Q incorporated by
reference into the Prospectus as indicated in their reports thereon copies
of which have been separately furnished to the Representatives; and on the
basis of specified procedures including inquiries of officials of the
Company who have responsibility for financial and accounting matters
regarding whether the unaudited condensed consolidated financial statements
referred to in paragraph (vi)(A)(i) below comply as to form in all material
respects with the applicable accounting requirements of the Act and the
Exchange Act and the related published rules and regulations, nothing came
to their attention that caused them to believe that the unaudited condensed
consolidated financial statements do not comply as to form in all material
respects with the applicable accounting requirements of the Act and the
Exchange Act and the related published rules and regulations;
(iv) The unaudited selected financial information with respect to the
consolidated results of operations and financial position of the Company
for the five most recent fiscal years included in the Prospectus and
included or incorporated by reference in Item 6 of the Company's Annual
Report on Form 10-K for the most recent fiscal year agrees with the
corresponding amounts (after restatement where applicable) in the audited
consolidated financial statements for such five fiscal years which were
included or incorporated by reference in the Company's Annual Reports on
Form 10-K for such fiscal years;
<PAGE>
(v) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available interim
financial statements of the Company and its subsidiaries, inspection of the
minute books of the Company and its subsidiaries since the date of the
latest audited financial statements included or incorporated by reference
in the Prospectus, inquiries of officials of the Company and its
subsidiaries responsible for financial and accounting matters and such
other inquiries and procedures as may be specified in such letter, nothing
came to their attention that caused them to believe that:
(A) (i) the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of cash flows
included in the Prospectus and/or included or incorporated by reference in
the Company's Quarterly Reports on Form 10-Q incorporated by reference in
the Prospectus do not comply as to form in all material respects with the
applicable accounting requirements of the Exchange Act and the related
published rules and regulations, or (ii) any material modifications should
be made to the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of cash flows
included in the Prospectus or included in the Company's Quarterly Reports
on Form 10-Q incorporated by reference in the Prospectus, for them to be in
conformity with generally accepted accounting principles;
(B) any other unaudited income statement data and balance sheet items
included in the Prospectus do not agree with the corresponding items in the
unaudited consolidated financial statements from which such data and items
were derived, and any such unaudited data and items were not determined on
a basis substantially consistent with the basis for the corresponding
amounts in the audited consolidated financial statements included or
incorporated by reference in the Company's Annual Report on Form 10-K for
the most recent fiscal year;
(C) the unaudited financial statements which were not included in the
Prospectus but from which were derived the unaudited condensed financial
statements referred to in clause (A) and any unaudited income statement
data and balance sheet items included in the Prospectus and referred to in
clause (B) were not determined on a basis substantially consistent with the
basis for the audited financial statements included or incorporated by
reference in the Company's Annual Report on Form 10-K for the most recent
fiscal year;
(D) any unaudited pro forma consolidated condensed financial
statements included or incorporated by reference in the Prospectus do not
comply as to form in all material
2
<PAGE>
respects with the applicable accounting requirements of the Act and the
published rules and regulations thereunder or the pro forma adjustments
have not been properly applied to the historical amounts in the compilation
of those statements;
(E) as of a specified date not more than five days prior to the date
of such letter, there have been any changes in the consolidated capital
stock (other than issuances of capital stock upon exercise of options and
stock appreciation rights, upon earn-outs of performance shares and upon
conversions of convertible securities, in each case which were outstanding
on the date of the latest balance sheet included or incorporated by
reference in the Prospectus) or any increase in the consolidated long-term
debt of the Company and its subsidiaries, or any decreases in consolidated
net current assets or stockholders' equity or other items specified by the
Representatives, or any increases in any items specified by the
Representatives, in each case as compared with amounts shown in the latest
balance sheet included or incorporated by reference in the Prospectus,
except in each case for changes, increases or decreases which the
Prospectus discloses have occurred or may occur or which are described in
such letter; and
(F) for the period from the date of the latest financial statements
included or incorporated by reference in the Prospectus to the specified
date referred to in Clause (E) there were any decreases in consolidated net
revenues or operating profit or the total or per share amounts of
consolidated net income or other items specified by the Representatives, or
any increases in any items specified by the Representatives, in each case
as compared with the comparable period of the preceding year and with any
other period of corresponding length specified by the Representatives,
except in each case for increases or decreases which the Prospectus
discloses have occurred or may occur or which are described in such letter;
and
(vi) In addition to the examination referred to in their report(s)
included or incorporated by reference in the Prospectus and the limited
procedures, inspection of minute books, inquiries and other procedures
referred to in paragraphs (iii) and (vi) above, they have carried out
certain specified procedures, not constituting an examination in accordance
with generally accepted auditing standards, with respect to certain
amounts, percentages and financial information specified by the
Representatives which are derived from the general accounting records of
the Company and its subsidiaries, which appear in the Prospectus (excluding
documents incorporated by reference), or in Part II of, or in exhibits and
schedules to, the Registration Statement specified by the Representatives
or in documents incorporated by reference in the Prospectus specified by
the Representatives, and have compared certain of such amounts, percentages
and financial information with the accounting records of the Company and
its subsidiaries and have found them to be in agreement.
All references in this Annex II to the Prospectus shall be deemed to refer
to the Prospectus (including the documents incorporated by reference therein) as
defined in the Underwriting Agreement as of the date of the letter delivered on
the date of the Pricing Agreement for purposes of such letter and to the
Prospectus as amended or supplemented (including the documents
3
<PAGE>
incorporated by reference therein) in relation to the applicable Designated
Securities for purposes of the letter delivered at the Time of Delivery for such
Designated Securities.
4
<PAGE>
ANNEX III(a)
[Draft Opinion of Counsel for the Underwriters]
<PAGE>
ANNEX III(b)
[Draft Opinion of Louise M. Parent]
<PAGE>
ANNEX III(c)
[Draft Opinion of Special Delaware Counsel for the Designated Trust and the
Company]
<PAGE>
ANNEX III(d)
[Draft Opinion of Tax Counsel]
<PAGE>
Exhibit 4.1
AMERICAN EXPRESS COMPANY
to
BANKERS TRUST COMPANY,
as Trustee
JUNIOR SUBORDINATED INDENTURE
Dated as of June --, 1998
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I
Definitions and Other Provisions of General Application
Section 1.1. Definitions................................................... 1
Section 1.2. Compliance Certificate and Opinions........................... 9
Section 1.3. Forms of Documents Delivered to Trustee....................... 10
Section 1.4. Acts of Holders............................................... 11
Section 1.5. Notices, Etc. to Trustee and Corporation...................... 13
Section 1.6. Notice to Holders; Waiver..................................... 13
Section 1.7. Conflict with Trust Indenture Act............................. 13
Section 1.8. Effect of Headings and Table of Contents...................... 14
Section 1.9. Successors and Assigns........................................ 14
Section 1.10. Separability Clause.......................................... 14
Section 1.11. Benefits of Indenture........................................ 14
Section 1.12. Governing Law................................................ 14
Section 1.13. Non-Business Days............................................ 14
ARTICLE II
Security Forms
Section 2.1. Forms Generally............................................... 15
Section 2.2. Form of Face of Security...................................... 15
Section 2.3. Form of Reverse of Security................................... 18
Section 2.4. Additional Provisions Required in Global Security............. 21
Section 2.5. Form of Trustee's Certificate of Authentication............... 21
ARTICLE III
The Securities
Section 3.1. Title and Terms............................................... 22
Section 3.2. Denominations................................................. 25
Section 3.3. Execution, Authentication, Delivery and Dating................ 25
Section 3.4. Temporary Securities.......................................... 26
Section 3.5. Global Securities............................................. 27
Section 3.6. Registration, Transfer and Exchange Generally................. 28
Section 3.7. Mutilated, Destroyed, Lost and Stolen Securities.............. 29
Section 3.8. Payment of Interest and Additional Interest; Interest Rights
Preserved................................................................. 30
Section 3.9. Persons Deemed Owners......................................... 31
-i-
<PAGE>
Page
Section 3.10. Cancellation................................................. 31
Section 3.11. Computation of Interest...................................... 31
Section 3.12. Deferrals of Interest Payment Dates.......................... 32
Section 3.13. Right of Set-Off............................................. 33
Section 3.14. Agreed Tax Treatment......................................... 33
Section 3.15. Shortening of Stated Maturity................................ 33
Section 3.16. CUSIP Numbers................................................ 33
ARTICLE IV
Satisfaction and Discharge
Section 4.1. Satisfaction and Discharge of Indenture....................... 34
Section 4.2. Application of Trust Money.................................... 35
ARTICLE V
Remedies
Section 5.1. Events of Default............................................. 35
Section 5.2. Acceleration of Maturity; Rescission and Annulment............ 36
Section 5.3. Collection of Indebtedness and Suits for Enforcement by
Trustee...................................................... 37
Section 5.4. Trustee May File Proofs of Claim.............................. 38
Section 5.5. Trustee May Enforce Claim Without Possession of Securities.... 39
Section 5.6. Application of Money Collected................................ 39
Section 5.7. Limitation on Suits........................................... 40
Section 5.8. Unconditional Right of Holders to Receive Principal, Premium
and Interest; Direct Action by Holders of Capital Securities. 40
Section 5.9. Restoration of Rights and Remedies............................ 41
Section 5.10. Rights and Remedies Cumulative............................... 41
Section 5.11. Delay or Omission Not Waiver................................. 41
Section 5.12. Control by Holders........................................... 41
Section 5.13. Waiver of Past Defaults...................................... 42
Section 5.14. Undertaking for Costs........................................ 42
Section 5.15. Waiver of Usury, Stay or Extension Laws...................... 43
-ii-
<PAGE>
Page
ARTICLE VI
The Trustee
Section 6.1. Certain Duties and Responsibilities........................... 43
Section 6.2. Notice of Defaults............................................ 44
Section 6.3. Certain Rights of Trustee..................................... 44
Section 6.4. Not Responsible for Recitals or Issuance of Securities........ 45
Section 6.5. May Hold Securities........................................... 45
Section 6.6. Money Held in Trust........................................... 46
Section 6.7. Compensation and Reimbursement................................ 46
Section 6.8. Disqualification; Conflicting Interests....................... 46
Section 6.9. Corporate Trustee Required; Eligibility....................... 47
Section 6.10. Resignation and Removal; Appointment of Successor............ 47
Section 6.11. Acceptance of Appointment by Successor....................... 48
Section 6.12. Merger, Conversion, Consolidation or Succession to Business.. 49
Section 6.13. Preferential Collection of Claims Against Corporation........ 50
Section 6.14. Appointment of Authenticating Agent.......................... 50
ARTICLE VII
Holder's Lists and Reports by Trustee And Corporation
Section 7.1. Corporation to Furnish Trustee Names and Addresses of Holders. 51
Section 7.2. Preservation of Information, Communications to Holders........ 52
Section 7.3. Reports by Trustee............................................ 52
Section 7.4. Reports by Corporation........................................ 52
ARTICLE VIII
Consolidation, Merger, Conveyance, Transfer or Lease
Section 8.1. Corporation May Consolidate, Etc., Only on Certain Terms...... 53
Section 8.2. Successor Corporation Substituted............................. 54
-iii-
<PAGE>
Page
ARTICLE IX
Supplemental Indentures
Section 9.1. Supplemental Indentures without Consent of Holders............ 54
Section 9.2. Supplemental Indentures with Consent of Holders............... 55
Section 9.3. Execution of Supplemental Indentures.......................... 57
Section 9.4. Effect of Supplemental Indentures............................. 57
Section 9.5. Conformity with Trust Indenture Act........................... 57
Section 9.6. Reference in Securities to Supplemental Indentures............ 57
ARTICLE X
Covenants
Section 10.1. Payment of Principal, Premium and Interest................... 57
Section 10.2. Maintenance of Office or Agency.............................. 58
Section 10.3. Money for Security Payments to be Held in Trust.............. 58
Section 10.4. Statement as to Compliance................................... 59
Section 10.5. Waiver of Certain Covenants.................................. 60
Section 10.6. Additional Sums.............................................. 60
Section 10.7. Additional Covenants......................................... 60
Section 10.8. Original Issue Discount...................................... 61
ARTICLE XI
Redemption of Securities
Section 11.1. Applicability of This Article................................ 62
Section 11.2. Election to Redeem; Notice to Trustee........................ 62
Section 11.3. Selection of Securities to be Redeemed....................... 62
Section 11.4. Notice of Redemption......................................... 63
Section 11.5. Deposit of Redemption Price.................................. 64
Section 11.6. Payment of Securities Called for Redemption.................. 64
Section 11.7. Right of Redemption of Securities Initially Issued to an
Issuer Trust................................................ 64
-iv-
<PAGE>
Page
ARTICLE XII
Sinking Funds
Section 12.1. Applicability of Article..................................... 65
Section 12.2. Satisfaction of Sinking Fund Payments with Securities........ 65
Section 12.3. Redemption of Securities for Sinking Fund.................... 66
ARTICLE XIII
Subordination of Securities
Section 13.1. Securities Subordinate to Senior Indebtedness................ 67
Section 13.2. No Payment When Senior Indebtedness in Default; Payment Over
of Proceeds Upon Dissolution, Etc........................... 67
Section 13.3. Payment Permitted If No Default.............................. 69
Section 13.4. Subrogation to Rights of Holders of Senior Indebtedness...... 69
Section 13.5. Provisions Solely to Define Relative Rights.................. 70
Section 13.6. Trustee to Effectuate Subordination.......................... 70
Section 13.7. No Waiver of Subordination Provisions........................ 70
Section 13.8. Notice to Trustee............................................ 71
Section 13.9. Reliance on Judicial Order or Certificate of Liquidating
Agent....................................................... 71
Section 13.10. Trustee Not Fiduciary for Holders of Senior Indebtedness.... 72
Section 13.11. Rights of Trustee as Holder of Senior Indebtedness;
Preservation of Trustee's Rights........................... 72
Section 13.12. Article Applicable to Paying Agents......................... 72
-v-
<PAGE>
JUNIOR SUBORDINATED INDENTURE, dated as of June __, 1998, between AMERICAN
EXPRESS COMPANY, a New York corporation (the "Corporation"), having its
principal office at World Financial Center, 200 Vesey Street, New York, New York
10285, and BANKERS TRUST COMPANY, a New York banking corporation, as Trustee
(the "Trustee").
Recitals of the Corporation
Whereas, the Corporation has duly authorized the execution and delivery of
this Indenture to provide for the issuance from time to time of its unsecured
junior subordinated debt securities in series (hereinafter called the
"Securities") of substantially the tenor hereinafter provided, including
Securities issued to evidence loans made to the Corporation of the proceeds from
the issuance from time to time by one or more business trusts (each an "Issuer
Trust") of undivided preferred beneficial interests in the assets of such Issuer
Trusts (the "Capital Securities") and undivided common beneficial interests in
the assets of such Issuer Trusts (the "Common Securities" and, collectively with
the Capital Securities, the "Trust Securities"), and to provide the terms and
conditions upon which the Securities are to be authenticated, issued and
delivered; and
Whereas, all things necessary to make this Indenture a valid agreement of
the Corporation, 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 covenanted and agreed, for the equal and
proportionate benefit of all Holders of the Securities or of any series thereof,
as follows:
ARTICLE I
Definitions and Other Provisions of General Application
Section 1.1. Definitions.
For all purposes of this Indenture, except as otherwise 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;
(2) All other terms used herein that are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(3) The words "include", "includes" and "including" shall be deemed to
be followed by the phrase "without limitation";
<PAGE>
(4) All accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles;
(5) Whenever the context may require, any gender shall be deemed to
include the others;
(6) Unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or a Section, as the case may
be, of this Indenture; and
(7) The words "hereby", "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.
"Act" when used with respect to any Holder has the meaning specified in
Section 1.4.
"Additional Interest" means the interest, if any, that shall accrue on any
interest on the Securities of any series the payment of which has not been made
on the applicable Interest Payment Date and which shall accrue at the rate per
annum specified or determined as specified in such Security.
"Additional Sums" has the meaning specified in Section 10.6.
"Additional Taxes" means, in the case of Securities of a series initially
issued to an Issuer Trust, taxes, duties or other governmental charges
imposed on the Issuer Trust as a result of a Tax Event (which, for the sake of
clarity, does not include amounts required to be deducted or withheld by the
Issuer Trust from payments made by the Issuer Trust to or for the benefit of the
Holder of, or any person that acquires a beneficial interest in, the
Securities).
"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.
"Agent Member" means any member of, or participant in, the Depositary.
"Applicable Procedures" means, with respect to any transfer or transaction
involving a Global Security or beneficial interest therein, the rules and
procedures of the Depositary for such Security, in each case to the extent
applicable to such transaction and as in effect from time to time.
"Authenticating Agent" means any Person authorized by the Trustee pursuant
to Section 6.14 to act on behalf of the Trustee to authenticate Securities of
one or more series.
"Bankruptcy Code" means Title 11 of the United States Code or any successor
statute thereto, in each case as amended from time to time.
-2-
<PAGE>
"Board of Directors" means the board of directors of the Corporation or the
Executive Committee of the board of directors of the Corporation (or any other
committee of the board of directors of the Corporation performing similar
functions) or a committee designated by the board of directors of the
Corporation (or such committee), comprised of two or more members of the board
of directors of the Corporation or officers of the Corporation, or both.
"Board Resolution" means a copy of a resolution certified by the Secretary
or an Assistant Secretary of the Corporation to have been duly adopted by the
Board of Directors, or officers of the Corporation to which authority to act on
behalf of the Board of Directors has been delegated, and to be in full force and
effect on the date of such certification, and delivered to the Trustee.
"Business Day" means any day other than (i) a Saturday or Sunday, (ii) a
day on which banking institutions in The City of New York are authorized or
required by law or executive order to remain closed, or (iii) a day on which the
Corporate Trust Office of the Trustee, or, with respect to the Securities of a
series initially issued to an Issuer Trust for so long as such Securities are
held by such Issuer Trust, the "Corporate Trust Office" (as defined in the
related Trust Agreement) of the Property Trustee or the Delaware Trustee under
the related Trust Agreement, is closed for business.
"Capital Securities" has the meaning specified in the first recital of this
Indenture.
"Commission" means the Securities and Exchange Commission, as from time to
time constituted, created under the Exchange Act, or if at any time after the
execution of this 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 on such date.
"Common Securities" has the meaning specified in the first recital of this
Indenture.
"Common Stock" means the common stock, par value $0.60 per share, of the
Corporation.
"Corporate Trust Office" means the principal office of the Trustee at which
at any particular time its corporate trust business shall be administered, which
office at the date of this Indenture is located at Four Albany Street, New York,
New York 10006, Attention: Corporate Trust and Agency Group.
"corporation" includes a corporation, association, company, limited
liability company, joint-stock company or business trust.
"Corporation" means the Person named as the "Corporation" in the first
paragraph of this instrument until a successor corporation shall have become
such pursuant to the applicable provisions of this Indenture, and thereafter
"Corporation" shall mean such successor corporation.
"Corporation Request" and "Corporation Order" mean, respectively, the
written request or order signed in the name of the Corporation by its Chairman
of the Board of Directors, its Vice Chairman of the Board of Directors, its
President or a Vice President, and by its Treasurer, an Assistant Treasurer, its
Secretary or an Assistant Secretary, and delivered to the Trustee.
"Debt" means, with respect to any Person, whether recourse is to all or a
portion of the assets of such Person and whether or not contingent and without
duplication, (i) every obligation of such Person for money borrowed; (ii) every
obligation of such Person evidenced by bonds, debentures,
-3-
<PAGE>
notes or other similar instruments, including obligations incurred in connection
with the acquisition of property, assets or businesses; (iii) every
reimbursement obligation of such Person with respect to letters of credit,
bankers' acceptances or similar facilities issued for the account of such
Person; (iv) every obligation of such Person issued or assumed as the deferred
purchase price of property or services (but excluding trade accounts payable or
accrued liabilities arising in the ordinary course of business); (v) every
capital lease obligation of such Person; (vi) all indebtedness of the
Corporation, whether incurred on or prior to the date of this Indenture or
thereafter incurred, for claims in respect of derivative products, including
interest rate, foreign exchange rate and commodity forward contracts, options
and swaps and similar arrangements; and (vii) every obligation of the type
referred to in clauses (i) through (vi) of another Person and all dividends of
another Person the payment of which, in either case, such Person has guaranteed
or is responsible or liable for, directly or indirectly, as obligor or
otherwise.
"Defaulted Interest" has the meaning specified in Section 3.8.
"Delaware Trustee" means, with respect to any Issuer Trust, the Person
identified as the "Delaware Trustee" in the related Trust Agreement, solely in
its capacity as Delaware Trustee of such Issuer Trust under such Trust Agreement
and not in its individual capacity, or its successor in interest in such
capacity, or any successor Delaware trustee appointed as therein provided.
"Depositary" means, with respect to the Securities of any series issuable
or issued in whole or in part in the form of one or more Global Securities, the
Person designated as Depositary by the Corporation pursuant to Section 3.1 with
respect to such series (or any successor thereto).
"Discount Security" means any security that provides for an amount less
than the principal amount thereof to be due and payable upon a declaration of
acceleration of the Maturity thereof pursuant to Section 5.2.
"Distributions," with respect to the Trust Securities issued by an Issuer
Trust, means amounts payable in respect of such Trust Securities as provided in
the related Trust Agreement and referred to therein as "Distributions."
"Dollar" or "$" means the currency of the United States of America that, as
at the time of payment, is legal tender for the payment of public and private
debts.
"Event of Default", unless otherwise specified with respect to a series of
Securities as contemplated by Section 3.1, has the meaning specified in Article
V.
"Exchange Act" means the Securities Exchange Act of 1934 or any statute
successor thereto, in each case as amended from time to time.
"Expiration Date" has the meaning specified in Section 1.4.
"Extension Period" has the meaning specified in Section 3.12.
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"Global Security" means a Security in the form prescribed in Section 2.4
evidencing all or part of a series of Securities, issued to the Depositary or
its nominee for such series, and registered in the name of such Depositary or
its nominee.
"Guarantee Agreement" means, with respect to any Issuer Trust, the
Guarantee Agreement executed by the Corporation for the benefit of the Holders
of the Capital Securities issued by such Issuer Trust as modified, amended or
supplemented from time to time.
"Holder" means a Person in whose name a Security is registered in the
Securities Register.
"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 and shall
include the terms of each particular series of Securities established as
contemplated by Section 3.1.
"Interest Payment Date" means, as to each series of Securities, the Stated
Maturity of an installment of interest on such Securities.
"Investment Company Act" means the Investment Company Act of 1940 or any
successor statute thereto, in each case as amended from time to time.
"Investment Company Event" means the receipt by an Issuer Trust of an
Opinion of Counsel (as defined in the relevant Trust Agreement) experienced in
such matters to the effect that, as a result of the occurrence of a change in
law or regulation or a written change (including any announced prospective
change) in interpretation or application of law or regulation by any legislative
body, court, governmental agency or regulatory authority, there is more than an
insubstantial risk that such Issuer Trust is or will be considered an
"investment company" that is required to be registered under the Investment
Company Act, which change or prospective change becomes effective or would
become effective, as the case may be, on or after the date of the issuance of
the Capital Securities of such Issuer Trust.
"Issuer Trust" has the meaning specified in the first recital of this
Indenture.
"Maturity" when used with respect to any Security means the date on which
the principal of such Security or any installment of principal becomes due and
payable as therein or herein provided, whether at the Stated Maturity or by
declaration of acceleration, call for redemption or otherwise.
"Notice of Default" means a written notice of the kind specified in Section
5.1(3).
"Officers' Certificate" means a certificate signed 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 Corporation and delivered to the Trustee.
"Opinion of Counsel" means a written opinion of counsel experienced in
matters of the kind described in the definition of Tax Event, who may be counsel
for or an employee of the Corporation or any Affiliate of the Corporation.
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"Original Issue Date" means the date of issuance specified as such in each
Security.
"Outstanding" means, when used in reference to any Securities, as of the
date of determination, all Securities theretofore authenticated and delivered
under this Indenture, except:
(i) Securities theretofore canceled by the Trustee or delivered to the
Trustee for cancellation;
(ii) Securities for whose payment money in the necessary amount has
been theretofore deposited with the Trustee or any Paying Agent in trust
for the Holders of such Securities; and
(iii) Securities in substitution for or in lieu of which other
Securities have been authenticated and delivered or that have been paid
pursuant to Section 3.7, unless proof satisfactory to the Trustee is
presented that any such Securities are held by Holders in whose hands such
Securities are valid, binding and legal obligations of the Corporation;
provided, however, that in determining whether the Holders of the requisite
principal amount of Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities owned
by the Corporation or any other obligor upon the Securities or any Affiliate of
the Corporation or such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Securities that a Responsible Officer of the Trustee
knows to be so owned shall be so disregarded. Securities so owned that have been
pledged in good faith may be regarded as Outstanding if the pledgee establishes
to the satisfaction of the Trustee the pledgee's right so to act with respect to
such Securities and that the pledgee is not the Corporation or any other obligor
upon the Securities or any Affiliate of the Corporation or such other obligor.
Upon the written request of the Trustee, the Corporation shall furnish to the
Trustee promptly an Officers' Certificate listing and identifying all
Securities, if any, known by the Corporation to be owned or held by or for the
account of the Corporation, or any other obligor on the Securities or any
Affiliate of the Corporation or such obligor, and subject to the provisions of
Section 6.1, the Trustee shall be entitled to accept such Officers' Certificate
as conclusive evidence of the facts therein set forth and of the fact that all
Securities not listed therein are Outstanding for the purpose of any such
determination. Notwithstanding anything herein to the contrary, Securities of
any series initially issued to an Issuer Trust that are owned by such Issuer
Trust shall be deemed to be Outstanding notwithstanding the ownership by the
Corporation or an Affiliate of any beneficial interest in such Issuer Trust.
"Paying Agent" means the Trustee or any Person authorized by the
Corporation to pay the principal of (or premium, if any) or interest on, or
other amounts in respect of, any Securities on behalf of the Corporation.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
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"Place of Payment" means, with respect to the Securities of any series, the
place or places where the principal of (and premium, if any) and interest on the
Securities of such series are payable pursuant to Section 3.1.
"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. For the purposes of this definition, any security
authenticated and delivered under Section 3.7 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.
"Proceeding" has the meaning specified in Section 13.2.
"Property Trustee" means, with respect to any Issuer Trust, the Person
identified as the "Property Trustee" in the related Trust Agreement, solely in
its capacity as Property Trustee of such Issuer Trust under such Trust Agreement
and not in its individual capacity, or its successor in interest in such
capacity, or any successor property trustee appointed as therein provided.
"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 or the
terms of such Security.
"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.
"Regular Record Date" for the interest payable on any Interest Payment Date
with respect to the Securities of a series means, unless otherwise provided
pursuant to Section 3.1 with respect to Securities of such series, the date that
is fifteen days next preceding such Interest Payment Date (whether or not a
Business Day).
"Responsible Officer", when used with respect to the Trustee, means any
officer assigned to the Corporate Trust Office, including any managing director,
vice president, principal, assistant vice president, assistant treasurer, 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.
"Rights Plan" means a plan of the Corporation providing for the issuance by
the Corporation to all holders of its Common Stock, par value $0.60 per share,
of rights entitling the holders thereof to subscribe for or purchase shares of
any class or series of capital stock of the Corporation which rights (i) are
deemed to be transferred with such shares of such Common Stock, and (ii) are
also issued in respect of future issuances of such Common Stock, in each case
until the occurrence of a specified event or events.
"Securities" or "Security" means any debt securities or debt security, as
the case may be, authenticated and delivered under this Indenture.
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"Securities Act" means the Securities Act of 1933 or any successor statute
thereto, in each case as amended from time to time.
"Securities Register" and "Securities Registrar" have the respective
meanings specified in Section 3.6.
"Senior Indebtedness" means the principal of (and premium, if any) and
interest, if any (including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization relating to the Corporation whether
or not such claim for post-petition interest is allowed in such proceeding), on
Debt of the Corporation, whether incurred on or prior to the date of this
Indenture or thereafter incurred, unless, in the instrument creating or
evidencing the same or pursuant to which the same is outstanding, it is provided
that such obligations are not superior in right of payment to the Securities or
to other Debt that is pari passu with, or subordinated to, the Securities,
provided, however, that Senior Indebtedness shall not be deemed to include (a)
any Debt of the Corporation that, when incurred and without respect to any
election under Section 1111(b) of the Bankruptcy Reform Act of 1978, was without
recourse to the Corporation, (b) any Debt of the Corporation to any of its
Subsidiaries, (c) Debt to any employee of the Corporation, (d) any Securities,
(e) trade accounts payable of the Corporation, and (f) accrued liabilities
arising in the ordinary course of business of the Corporation.
"Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 3.8.
"Stated Maturity", when used with respect to any Security or any
installment of principal thereof (or premium, if any) or interest (including any
Additional Interest) thereon, means the date specified pursuant to the terms of
such Security as the fixed date on which the principal of such Security or such
installment of principal (or premium, if any) or interest (including any
Additional Interest) is due and payable, as such date may, in the case of the
stated maturity of the principal on any security, be shortened or extended as
provided pursuant to the terms of such Security and this Indenture and, in the
case of any installment of interest, subject to the deferral of any such date in
the case of any Extension Period.
"Subsidiary" means a corporation more than 50% of the outstanding voting
stock of which is owned, directly or indirectly, by the Corporation or by one or
more other Subsidiaries, or by the Corporation and one or more other
Subsidiaries. For purposes of this definition, "voting stock" means stock that
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.
"Successor Security" of any particular Security means every Security issued
after, and 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 3.7 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.
"Tax Event" means the receipt by an Issuer Trust of an Opinion of Counsel
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
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thereunder of the United States or any political subdivision or taxing authority
thereof or therein, or (b) any judicial decision or any official administrative
pronouncement (including any private letter ruling, technical advice
memorandum or field service advice) or regulatory procedure (an "Administrative
Action"), regardless of whether such judicial decision or Administrative Action
is issued to or in connection with a proceeding involving the Corporation or the
Issuer Trust and whether or not subject to review or appeal, which amendment,
clarification, change, Administrative Action or decision is enacted, promulgated
or announced, in each case, on or after the date hereof, there is more than an
insubstantial risk that (i) the Issuer Trust is, or will be within 90 days of
the date of such opinion, subject to United States Federal income tax with
respect to income received or accrued on the Junior Subordinated Debentures,
(ii) interest payable by the Corporation on the Junior Subordinated Debentures
is not, or within 90 days of the date of such opinion, will not be, deductible
by the Corporation, in whole or in part, for United States Federal income tax
purposes, or (iii) the Issuer Trust is, or will be within 90 days of the date of
such opinion, subject to more that a de minimis amount of other taxes, duties or
other governmental charges.
"Trust Agreement" means, with respect to any Issuer Trust, the trust
agreement or other governing instrument of such Issuer Trust.
"Trustee" means the Person named as the "Trustee" in the first paragraph of
this instrument, solely in its capacity as such and not in its individual
capacity, until a successor Trustee shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Trustee" shall mean or
include each Person who is then a Trustee hereunder and, if at any time there is
more than one such Person, "Trustee" as used with respect to the Securities of
any series shall mean the Trustee with respect to Securities of that series.
"Trust Indenture Act" means the Trust Indenture Act of 1939 (15 U.S.C.
(S)(S) 77aaa-77bbb), as amended and as in effect on the date as of this
Indenture, except as provided in Section 9.5.
"Trust Securities" has the meaning specified in the first recital of this
Indenture.
"Vice President," when used with respect to the Corporation, means any duly
appointed vice president, whether or not designated by a number or a word or
words added before or after the title "vice president."
Section 1.2. Compliance Certificate and Opinions.
Upon any application or request by the Corporation to the Trustee to take
any action under any provision of this Indenture, the Corporation shall furnish
to the Trustee an Officers' Certificate stating that all conditions precedent
(including covenants compliance with which constitutes a condition precedent),
if any, provided for in this Indenture relating to the proposed action have been
complied with and an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent (including covenants compliance with which
constitutes a condition precedent), if any, have been complied with, except that
in the case of any such application or request as to which the furnishing of
such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate or
opinion need be furnished.
Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture (other than the certificates provided
pursuant to Section 10.4) shall include:
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(1) a statement by each individual signing such certificate or opinion that
such individual has read such covenant or condition and the definitions herein
relating thereto;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions of such individual contained
in such certificate or opinion are based;
(3) a statement that, in the opinion of such individual, he or she has made
such examination or investigation as is necessary to enable him or her to
express an informed opinion as to whether or not such covenant or condition has
been complied with; and
(4) a statement as to whether, in the opinion of such individual, such
condition or covenant has been complied with.
Section 1.3. Forms 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.
Any certificate or opinion of an officer of the Corporation 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 matters upon which his or her 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 Corporation stating that the
information with respect to such factual matters is in the possession of the
Corporation, 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 1.4. Acts of Holders.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Indenture to be given to 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 is or are delivered to the
Trustee, and, where it is hereby expressly required, to the Corporation. 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
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Section 6.1) conclusive in favor of the Trustee and the Corporation, 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
the certificate of any 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 or her the execution thereof. Where such
execution is by a Person acting in other than his or her individual capacity,
such certificate or affidavit shall also constitute sufficient proof of his or
her authority.
(c) The fact and date of the execution by any Person of any such instrument
or writing, or the authority of the Person executing the same, may also be
proved in any other manner that the Trustee deems sufficient and in accordance
with such reasonable rules as the Trustee may determine.
(d) The ownership of Securities shall be proved by the Securities Register.
(e) Any request, demand, authorization, direction, notice, consent, waiver
or other action by the Holder of any Security shall bind every future Holder of
the same Security and the Holder of every Security issued upon the transfer
thereof or in exchange therefor or in lieu thereof in respect of anything done
or suffered to be done by the Trustee or the Corporation in reliance thereon,
whether or not notation of such action is made upon such Security.
(f) The Corporation may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities of any series entitled to
give, make or take any request, demand, authorization, direction, notice,
consent, waiver or other action provided or permitted by this Indenture to be
given, made or taken by Holders of Securities of such series, provided that the
Corporation may not set a record date for, and the provisions of this paragraph
shall not apply with respect to, the giving or making of any notice,
declaration, request or direction referred to in the next succeeding paragraph.
If any record date is set pursuant to this paragraph, the Holders of Outstanding
Securities of the relevant series on such record date, and no other Holders,
shall be entitled to take the relevant action, whether or not such Holders
remain Holders after such record date, provided that no such action shall be
effective hereunder unless taken on or prior to the applicable Expiration Date
(as defined below) by Holders of the requisite principal amount of Outstanding
Securities of such series on such record date. Nothing in this paragraph shall
be construed to prevent the Corporation from setting a new record date for any
action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and with
no action by any Person be cancelled and of no effect), and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite principal amount of Outstanding Securities of the relevant
series on the date such action is taken. Promptly after any record date is set
pursuant to this paragraph, the Corporation, at its own expense, shall cause
notice of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to the Trustee in writing and to each Holder of
Securities of the relevant series in the manner set forth in Section 1.6.
The Trustee may set any day as a record date for the purpose of determining
the Holders of Outstanding Securities of any series entitled to join in the
giving or making of (i) any Notice of Default, (ii) any declaration of
acceleration referred to in Section 5.2, (iii) any request to institute
proceedings referred to in Section 5.7(2), or (iv) any direction referred to in
Section 5.12, in each case
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with respect to Securities of such series. If any record date is set pursuant to
this paragraph, the Holders of Outstanding Securities of such series on such
record date, and no other Holders, shall be entitled to join in such notice,
declaration, request or direction, whether or not such Holders remain Holders
after such record date, provided that no such action shall be effective
hereunder unless taken on or prior to the applicable Expiration Date by Holders
of the requisite principal amount of Outstanding Securities of such series on
such record date. Nothing in this paragraph shall be construed to prevent the
Trustee from setting a new record date for any action for which a record date
has previously been set pursuant to this paragraph (whereupon the record date
previously set shall automatically and with no action by any Person be cancelled
and of no effect), and nothing in this paragraph shall be construed to render
ineffective any action taken by Holders of the requisite principal amount of
Outstanding Securities of the relevant series on the date such action is taken.
Promptly after any record date is set pursuant to this paragraph, the Trustee,
at the Corporation's expense, shall cause notice of such record date, the
proposed action by Holders and the applicable Expiration Date to be given to the
Corporation in writing and to each Holder of Securities of the relevant series
in the manner set forth in Section 1.6.
With respect to any record date set pursuant to this Section, the party
hereto that sets such record date may designate any day as the "Expiration Date"
and from time to time may change the Expiration Date to any earlier or later
day, provided that no such change shall be effective unless notice of the
proposed new Expiration Date is given to the other party hereto in writing, and
to each Holder of Securities of the relevant series in the manner set forth in
Section 1.6, on or prior to the existing Expiration Date. If an Expiration Date
is not designated with respect to any record date set pursuant to this Section,
the party hereto that set such record date shall be deemed to have initially
designated the 180th day after such record date as the Expiration Date with
respect thereto, subject to its right to change the Expiration Date as provided
in this paragraph. Notwithstanding the foregoing, no Expiration Date shall be
later than the 180th day after the applicable record date.
(g) Without limiting the foregoing, a Holder entitled hereunder to take any
action hereunder with regard to any particular Security may do so with regard to
all or any part of the principal amount of such Security or by one or more duly
appointed agents each of which may do so pursuant to such appointment with
regard to all or any part of such principal amount.
Section 1.5. Notices, Etc. to Trustee and Corporation.
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, any holder of Capital Securities or the
Corporation 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 Corporation by the Trustee, any Holder or any holder of Capital
Securities shall be sufficient for every purpose (except as otherwise provided
in Section 5.1) hereunder if in writing and mailed, first class, postage
prepaid, to the Corporation 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 Corporation.
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Section 1.6. 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 the address of such Holder as it appears in the Securities
Register, not later than the latest date, and not earlier than the earliest
date, prescribed for the giving of such notice. If, by reason of the suspension
of or irregularities in regular mail service or for any other reason, it shall
be impossible or impracticable to mail notice of any event to Holders when said
notice is required to be given pursuant to any provision of this Indenture or of
the relevant Securities, then any manner of giving such notice as shall be
satisfactory to the Trustee shall be deemed to be a sufficient giving of such
notice. In any case where notice to Holders is given by mail, neither the
failure to mail such notice, nor any defect in any notice so mailed, to any
particular Holder shall affect the sufficiency of such notice with respect to
other Holders. Where this Indenture provides for notice in any manner, such
notice may be waived in writing by the Person entitled to receive such notice,
either before or after the event, and such waiver shall be the equivalent of
such notice. Waivers of notice by Holders shall be filed with the Trustee, but
such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.
Section 1.7. Conflict with Trust Indenture Act.
If any provision of this Indenture limits, qualifies or conflicts with the
duties imposed by any of Sections 310 to 317, inclusive, of the Trust Indenture
Act through operation of Section 318(c) thereof, such imposed duties shall
control. If any provision of this Indenture modifies or excludes any provision
of the Trust Indenture Act which may be so modified or excluded, the latter
provision shall be deemed to apply to this Indenture as so modified or to be
excluded, as the case may be.
Section 1.8. 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 1.9. Successors and Assigns.
All covenants and agreements in this Indenture by the Corporation shall
bind its successors and assigns, whether so expressed or not.
Section 1.10. Separability Clause.
If 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.
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Section 1.11. 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 and
assigns, the holders of Senior Indebtedness, the Holders of the Securities and,
to the extent expressly provided in Sections 5.1, 5.2, 5.8, 5.9, 5.11, 5.13, 9.1
and 9.2, the holders of Capital Securities, any benefit or any legal or
equitable right, remedy or claim under this Indenture.
Section 1.12. Governing Law.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
Section 1.13. Non-Business Days.
If 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 the Securities) payment of interest or principal (and
premium, if any) or other amounts in respect of such Security need not be made
on such date, but may be made on the next succeeding Business Day (and no
interest shall accrue in respect of the amounts whose payment is so delayed for
the period from and after such Interest Payment Date, Redemption Date or Stated
Maturity, as the case may be, until such next succeeding Business Day) except
that, if such Business Day falls in the next succeeding calendar year, such
payment shall be made on the immediately preceding Business Day (in each case
with the same force and effect as if made on the Interest Payment Date or
Redemption Date or at the Stated Maturity).
ARTICLE II
Security Forms
Section 2.1. Forms Generally.
The Securities of each series and the Trustee's certificate of
authentication shall be in substantially the forms set forth in this Article, or
in such other form or forms as shall be established by or pursuant to a Board
Resolution or in one or more indentures supplemental hereto, in each case with
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 applicable tax laws or 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. If the form of Securities of any series is established by action
taken pursuant to a Board Resolution, a copy of an appropriate record of such
action shall be certified by the Secretary or an Assistant Secretary of the
Corporation and delivered to the Trustee at or prior to the delivery of the
Corporation Order contemplated by Section 3.3 with respect to the authentication
and delivery of such Securities.
The definitive Securities shall be printed, lithographed or engraved or
produced by any combination of these methods, if required by any securities
exchange on which the Securities may be
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listed, on a steel engraved border or steel engraved borders or may be produced
in any other manner permitted by the rules of any securities exchange on which
the Securities may be listed, all as determined by the officers executing such
Securities, as evidenced by their execution of such securities.
Section 2.2. Form of Face of Security.
AMERICAN EXPRESS COMPANY
[Title of Security]
No. $
AMERICAN EXPRESS COMPANY, a corporation organized and existing under the
laws of New York (hereinafter called the "Corporation", which term includes any
successor Person under the Indenture hereinafter referred to), for value
received, hereby promises to pay to _______________, or registered assigns, the
principal sum of __________ Dollars on __________ __, [if the Security is a
Global Security, then insert, if applicable--, or such other principal amount
represented hereby as may be set forth in the records of the Securities
Registrar hereinafter referred to in accordance with the Indenture,] [; provided
that the Corporation may shorten the Stated Maturity of the principal of this
Security to a date not earlier than at any time on one or more occasions,
subject to certain conditions specified in Section 3.15 of the Indenture. The
Corporation further promises to pay interest on said principal sum from
_______________, ___ or from the most recent Interest Payment Date to which
interest has been paid or duly provided for, [quarterly] [semi-annually] [if
applicable, insert--(subject to deferral as set forth herein)] in arrears on
[insert applicable Interest Payment Dates] of each year, commencing
______________, ___, at the rate of ___% per annum, [if applicable insert--
together with Additional Sums, if any, as provided in Section 10.6 of the
Indenture] until the principal hereof is paid or duly provided for or made
available for payment [if applicable, insert-- ; provided that any overdue
principal, premium or Additional Sums and any overdue installment of interest
shall bear Additional Interest at the rate of____% per annum (to the extent that
the payment of such interest shall be legally enforceable), compounded
[quarterly] [semi-annually], from the dates such amounts are due until they are
paid or made available for payment, and such interest shall be payable on
demand]. The amount of interest payable for any period less than a full interest
period shall be computed on the basis of a 360-day year of twelve 30-day months
and the actual days elapsed in a partial month in such period. The amount of
interest payable for any full interest period shall be computed by dividing the
applicable rate per annum by [four/two]. The interest so payable, and punctually
paid or duly provided for, on any Interest Payment Date will, as provided in the
Indenture, be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest installment [if applicable insert--, which shall
be the [____________ or ____________] (whether or not a Business Day), as the
case may be, next preceding such Interest Payment Date]. Any such interest 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 this Security (or 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 of this series 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 of this
series may be listed, and upon such notice as may be required by such exchange,
all as more fully provided in said Indenture.
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[If applicable, insert--So long as no Event of Default has occurred and is
continuing, the Corporation shall have the right, at any time during the term of
this Security, from time to time to defer the payment of interest on this
Security for up to ______ consecutive [quarterly] [semi-annual] interest payment
periods with respect to each deferral period (each an "Extension Period") [If
applicable, insert--, during which Extension Periods the Corporation shall have
the right to make partial payments of interest on any Interest Payment Date,
and] at the end of which the Corporation shall pay all interest then accrued and
unpaid including any Additional Interest, as provided below; provided, however,
that no Extension Period shall extend beyond the Stated Maturity of the
principal of this Security [If Stated Maturity can be shortened or extended,
insert--, as then in effect,] and no such Extension Period may end on a date
other than an Interest Payment Date; and provided, further, however, that during
any such Extension Period, the Corporation shall not (i) declare or pay any
dividends or distributions on, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of the Corporation's capital stock, or
(ii) make any payment of principal of or interest or premium, if any, on or
repay, repurchase or redeem any debt securities of the Corporation that rank
pari passu in all respects with or junior in interest to this Security (other
than (a) repurchases, redemptions or other acquisitions of shares of capital
stock of the Corporation 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, in connection with a dividend
reinvestment or stockholder stock purchase plan or in connection with the
issuance of capital stock of the Corporation (or securities convertible into or
exercisable for such capital stock) as consideration in an acquisition
transaction entered into prior to the applicable Extension Period, (b) as a
result of an exchange or conversion of any class or series of the Corporation's
capital stock (or any capital stock of a Subsidiary of the Corporation) for any
class or series of the Corporation's capital stock or of any class or series of
the Corporation's indebtedness for any class or series of the Corporation's
capital stock, (c) the purchase of fractional interests in shares of the
Corporation's capital stock pursuant to the conversion or exchange provisions of
such capital stock or the security being converted or exchanged, (d) any
declaration of a dividend in connection with any Rights Plan, or the issuance of
rights, stock or other property under any 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
Corporation may further defer the payment of interest, provided that no
Extension Period shall exceed ______ consecutive [quarterly] [semi-annual]
interest payment periods, extend beyond the Stated Maturity of the principal of
this Security or end on a date other than an Interest Payment Date. Upon the
termination of any such Extension Period and upon the payment of all accrued and
unpaid interest and any Additional Interest then due on any Interest Payment
Date, the Corporation may elect to begin a new Extension Period, subject to the
above conditions. No interest shall be due and payable during an Extension
Period, except at the end thereof, but each installment of interest that would
otherwise have been due and payable during such Extension shall bear Additional
Interest (to the extent that the payment of such interest shall be legally
enforceable) at the rate of ____% per annum, compounded [monthly] [quarterly]
[semi-annually] and calculated as set forth in the first paragraph of this
Security, from the dates on which amounts would otherwise have been due and
payable until paid or made available for payment. The Corporation shall give the
Holder of this Security and the Trustee notice of its election to begin any
Extension Period at least one Business Day prior to the next succeeding Interest
Payment Date on which interest on this Security would be payable but for such
deferral [if applicable, insert--or so long as such Securities are held by
[insert name of applicable Issuer Trust], at least one Business Day prior to the
earlier of (i) the next succeeding date on
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which Distributions on the Capital Securities of such Issuer Trust would be
payable but for such deferral, and (ii) the date on which the Property Trustee
of such Issuer Trust is required to give notice to holders of such Capital
Securities of the record date or the date such Distributions are payable].
Payment of the principal of (and premium, if any) and interest on this
Security will be made at the office or agency of the Corporation maintained for
that purpose in the [insert Place of Payment], 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 [if applicable, insert--; provided, however, that at
the option of the Corporation 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 Securities Register, or (ii) by wire transfer in immediately
available funds at such place and to such account as may be designated by the
Person entitled thereto as specified in the Securities Register].
The indebtedness evidenced by this Security is, to the extent provided in
the Indenture, subordinate and junior in right of payment to the prior payment
in full of all Senior Indebtedness, and this Security is issued subject to the
provisions of the Indenture with respect thereto. Each Holder of this Security,
by accepting the same, (a) agrees to and shall be bound by such provisions, (b)
authorizes and directs the Trustee on his or her behalf to take such actions as
may be necessary or appropriate to effectuate the subordination so provided, and
(c) appoints the Trustee his or her attorney-in-fact for any and all such
purposes. Each Holder hereof, by his or her acceptance hereof, waives all notice
of the acceptance of the subordination provisions contained herein and in the
Indenture by each holder of Senior Indebtedness, whether now outstanding or
hereafter incurred, and waives reliance by each such holder upon said
provisions.
Reference is hereby made to the further provisions of this Security set
forth 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.
IN WITNESS WHEREOF, the Corporation has caused this instrument to be duly
executed under its corporate seal.
American Express Company
By:
--------------------------------
Name:
Title:
Attest:
- ---------------------------------------
[Secretary or Assistant Secretary]
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Section 2.3. Form of Reverse of Security.
This Security is one of a duly authorized issue of securities of the
Corporation (herein called the "Securities"), issued and to be issued in one or
more series under the Junior Subordinated Indenture, dated as of _____ __, ___
(herein called the "Indenture"), between the Corporation and Bankers Trust
Company , 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
Corporation, the Trustee, the holders of Senior Indebtedness and the Holders of
the Securities, and of the terms upon which the Securities are, and are to be,
authenticated and delivered. This Security is one of the series designated on
the face hereof [if applicable, insert--, limited in aggregate principal amount
to $ ___________].
All terms used in this Security that are defined in the Indenture [if
applicable, insert--or in the Amended and Restated Trust Agreement, dated as of
_________, 199_ (as modified, amended or supplemented from time to time, the
"Trust Agreement"), relating to [insert name of Issuer Trust] (the "Issuer
Trust") among the Corporation, as Depositor, the Trustees named therein and the
Holders from time to time of the Trust Securities issued pursuant thereto, shall
have the meanings assigned to them in the Indenture [if applicable, insert--or
the Trust Agreement, as the case may be].
[If applicable, insert--The Corporation may at any time, at its option, on
or after _________, ____, and subject to the terms and conditions of Article XI
of the Indenture, redeem this Security in whole at any time or in part from time
to time, at [if applicable, insert-- the following Redemption Prices (expressed
as percentages of the principal amount hereof): If redeemed during the 12-month
period beginning _____________,
Redemption
Year Price
---- ----------
and thereafter at a Redemption Price equal to 100% of the principal amount
hereof, together, in the case of any such redemption, with accrued interest [if
applicable, insert--, including any Additional Interest,] to but excluding the
date fixed for redemption,] [a Redemption Price equal to 100% of the principal
amount hereof, together, in the case of any such redemption, with accrued
interest [if applicable, insert--, including any Additional Interest,] to but
excluding the date fixed for redemption.]
[If applicable, insert--In addition, upon the occurrence and during the
continuation of a Tax Event or an Investment Company Event in respect of the
Issuer Trust, the Corporation may, at its option, at any time within 90 days of
the occurrence and during the continuation of such Tax Event or Investment
Company Event, as the case may be redeem this Security, in whole but not in
part, subject to the terms and conditions of Article XI of the Indenture, at a
redemption price equal to [insert formula].
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<PAGE>
[If the Security is subject to redemption of any kind, insert--In the event
of redemption of this Security in part only, a new Security or Securities of
this series for the unredeemed portion hereof will be issued in the name of the
Holder hereof upon the cancellation hereof.]
The Indenture contains provisions for satisfaction and discharge of the
entire indebtedness of this Security upon compliance by the Corporation with
certain conditions set forth in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the
Corporation and the Trustee at any time to enter into a supplemental indenture
or indentures for the purpose of modifying in any manner the rights and
obligations of the Corporation and of the Holders of the Securities, with the
consent of the Holders of not less than a majority in principal amount of the
Outstanding Securities of each series to be affected by such supplemental
indenture. The Indenture also contains provisions permitting Holders of
specified percentages in principal amount of the Securities of each series at
the time Outstanding, on behalf of the Holders of all Securities of such series,
to waive compliance by the Corporation with certain provisions of the Indenture
and certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Security shall be conclusive and binding
upon such Holder and upon all future Holders of this Security and of any
Security issued upon the registration of transfer hereof or in exchange herefor
or in lieu hereof, whether or not notation of such consent or waiver is made
upon this Security.
[If the Security is not a Discount Security, insert--As provided in and
subject to the provisions of the Indenture, if an Event of Default with respect
to the Securities of this series at the time Outstanding 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 of this
series may declare the principal amount of all the Securities of this series to
be due and payable immediately, by a notice in writing to the Corporation (and
to the Trustee if given by Holders) [if applicable, insert--, provided that, if
upon an Event of Default, the Trustee or such Holders fail to declare the
principal of all the Outstanding Securities of this series to be immediately due
and payable, the holders of at least 25% in aggregate Liquidation Amount of the
Capital Securities then Outstanding shall have the right to make such
declaration by a notice in writing to the Corporation and the Trustee]; and upon
any such declaration the principal amount of and the accrued interest (including
any Additional Interest) on all the Securities of this series shall become
immediately due and payable, provided that the payment of principal and interest
(including any Additional Interest) on such Securities shall remain subordinated
to the extent provided in Article XIII of the Indenture.]
No reference herein to the Indenture and no provision of this Security or
of the Indenture shall alter or impair the obligation of the Corporation, which
is absolute and unconditional, to pay the principal of (and premium, if any) and
interest [insert if applicable--including any Additional 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 Securities Register,
upon surrender of this Security for registration of transfer at the office or
agency of the Corporation maintained under Section 10.2 of the Indenture for
such purpose, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Corporation and the Securities Registrar
duly executed by, the Holder hereof or such Holder's attorney duly authorized in
writing, and thereupon one or more new Securities of this series,
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of like tenor, of authorized denominations and for the same aggregate principal
amount, will be issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered form without
coupons in denominations of $____________ and any integral multiple of
$____________ in excess thereof. As provided in the Indenture and subject to
certain limitations therein set forth, Securities of this series are
exchangeable for a like aggregate principal amount of Securities of this series
and of like tenor of a different authorized denomination, as requested by the
Holder surrendering the same.
No service charge shall be made for any such registration of transfer or
exchange, but the Corporation 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
Corporation, the Trustee and any agent of the Corporation 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
Corporation, the Trustee nor any such agent shall be affected by notice to the
contrary.
The Corporation and, by its acceptance of this Security or a beneficial
interest therein, the Holder of, and any Person that acquires a beneficial
interest in, this Security agree that for United States Federal, state and local
tax purposes it is intended that this Security constitute indebtedness.
THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK.
Section 2.4. Additional Provisions Required in Global Security.
Unless otherwise specified as contemplated by Section 3.1, any Global
Security issued hereunder shall, in addition to the provisions contained in
Sections 2.2 and 2.3, bear a legend in substantially the following form:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE OF A DEPOSITARY. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE
ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND MAY NOT BE
TRANSFERRED EXCEPT 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, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN
THE INDENTURE.
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Section 2.5. Form of Trustee's Certificate of Authentication.
The Trustee's certificates of authentication shall be in substantially the
following form:
This is one of the Securities of the series designated therein referred to
in the within-mentioned Indenture.
Dated:
Bankers Trust Company,
as Trustee
By:
-----------------------------------------
Authorized officer
ARTICLE III
The Securities
Section 3.1. Title and Terms.
The aggregate principal amount of Securities that may be authenticated and
delivered under this Indenture is unlimited.
The Securities may be issued in one or more series. There shall be
established in or pursuant to a Board Resolution and, subject to Section 3.3,
set forth or determined in the manner provided in an Officers' Certificate, or
established in one or more indentures supplemental hereto, prior to the issuance
of Securities of a series:
(a) the title of the securities of such series, which shall
distinguish the Securities of the series from all other Securities;
(b) the limit, if any, upon the aggregate principal amount of the
Securities of such series that may be authenticated and delivered under
this Indenture (except for Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other
Securities of the series pursuant to Section 3.4, 3.6, 3.7, 9.6 or 11.6 and
except for any Securities that, pursuant to Section 3.3, are deemed never
to have been authenticated and delivered hereunder); provided, however,
that the authorized aggregate principal amount of such series may be
increased above such amount by a Board Resolution to such effect;
(c) the Person to whom any interest on a Security of the series shall
be payable, if other than 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;
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<PAGE>
(d) the Stated Maturity or Maturities on which the principal of the
Securities of such series is payable or the method of determination
thereof, and any dates on which or circumstances under which, the
Corporation shall have the right to extend or shorten such Stated Maturity
or Maturities;
(e) the rate or rates, if any, at which the Securities of such series
shall bear interest, if any, the rate or rates and extent to which
Additional Interest, if any, shall be payable in respect of any Securities
of such series, the date or dates from which any such interest or
Additional Interest shall accrue, the Interest Payment Dates on which such
interest shall be payable, the right, pursuant to Section 3.12 or as
otherwise set forth therein, of the Corporation to defer or extend an
Interest Payment Date, and the Regular Record Date for the interest payable
on any Interest Payment Date or the method by which any of the foregoing
shall be determined;
(f) the place or places where the principal of (and premium, if any)
and interest (including any Additional Interest) on the Securities of such
series shall be payable, the place or places where the Securities of such
series may be presented for registration of transfer or exchange, any
restrictions that may be applicable to any such transfer or exchange in
addition to or in lieu of those set forth herein, and the place or places
where notices and demands to or upon the Corporation in respect of the
Securities of such series may be made;
(g) the period or periods within or the date or dates on which, if
any, the price or prices at which and the terms and conditions upon which
the Securities of such series may be redeemed, in whole or in part, at the
option of the Corporation, and if other than by a Board Resolution, the
manner in which any election by the Corporation to redeem such Securities
shall be evidenced;
(h) the obligation or the right, if any, of the Corporation to redeem,
repay or purchase the Securities of such series pursuant to any sinking
fund, amortization or analogous provisions, or at the option of a Holder
thereof, and the period or periods within which, the price or prices at
which, the currency or currencies (including currency unit or units) in
which and the other terms and conditions upon which Securities of the
series shall be redeemed, repaid or purchased, in whole or in part,
pursuant to such obligation;
(i) the denominations in which any Securities of such series shall be
issuable, if other than denominations of [$25][$1,000] and any integral
multiple thereof;
(j) if other than Dollars, the currency or currencies (including any
currency unit or units) in which the principal of (and premium, if any) and
interest and Additional Interest, if any, on the Securities of the series
shall be payable, or in which the Securities of the series shall be
denominated and the manner of determining the equivalent thereof in Dollars
for purposes of the definition of Outstanding;
(k) the additions, modifications or deletions, if any, in the Events
of Default or covenants of the Corporation set forth herein with respect to
the Securities of such series;
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<PAGE>
(l) if other than the principal amount thereof, the portion of the
principal amount of Securities of such series that shall be payable upon
declaration of acceleration of the Maturity thereof;
(m) if the principal amount payable at the Stated Maturity of any
Securities of the series will not be determinable as of any one or more
dates prior to the Stated Maturity, the amount which shall be deemed to be
the principal amount of such Securities as of any such date for any purpose
thereunder or hereunder, including the principal amount thereof which shall
be due and payable upon any Maturity other than the Stated Maturity or
which shall be deemed to be Outstanding as of any date prior to the Stated
Maturity (or, in any such case, the manner in which such amount deemed to
be the principal amount shall be determined);
(n) the additions or changes, if any, to this Indenture with respect
to the Securities of such series as shall be necessary to permit or
facilitate the issuance of the Securities of such series in bearer form,
registrable or not registrable as to principal, and with or without
interest coupons;
(o) any index or indices used to determine the amount of payments of
principal of and premium, if any, on the Securities of such series or the
manner in which such amounts will be determined;
(p) if applicable, that any Securities of the series shall be issuable
in whole or in part in the form of one or more Global Securities and, in
such case, the respective Depositaries for such Global Securities, the form
of any legend or legends that shall be borne by any such Global Security in
addition to or in lieu of that set forth in Section 2.4 and any
circumstances in addition to or in lieu of those set forth in Section 3.6
in which any such Global Security may be exchanged in whole or in part for
Securities registered, and any transfer of such Global Security in whole or
in part may be registered, in the name or names of Persons other than the
Depositary for such Global Security or a nominee thereof;
(q) the appointment of any Paying Agent or agents for the Securities
of such series;
(r) the terms of any right to convert or exchange Securities of such
series into any other securities or property of the Corporation, and the
additions or changes, if any, to this Indenture with respect to the
Securities of such series to permit or facilitate such conversion or
exchange;
(s) if such Securities are to be issued to an Issuer Trust, the form
or forms of the Trust Agreement, Guarantee Agreement and Expense Agreement
relating thereto;
(t) if other than as set forth herein, the relative degree, if any, to
which the Securities of the series shall be senior to or be subordinated to
other series of Securities in right of payment, whether such other series
of Securities are Outstanding or not;
(u) any addition to or change in the Events of Default which applies
to any Securities of the series and any change in the right of the Trustee
or the requisite Holders of such Securities to declare the principal amount
thereof due and payable pursuant to Section 5.2;
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<PAGE>
(v) any addition to or change in the covenants set forth in Article X
which applies to Securities of the series; and
(w) any other terms of the Securities of such series (which terms
shall not be inconsistent with the provisions of this Indenture, except as
permitted by Section 9.1(6)).
All Securities of any one series shall be substantially identical except as
to denomination and except as may otherwise be provided herein or in or pursuant
to such Board Resolution and set forth, or determined in the manner provided, in
such Officers' Certificate or in any indenture supplemental hereto.
If any of the terms of the series are established by action taken pursuant
to a Board Resolution, a copy of an appropriate record of such action shall be
certified by the Secretary or an Assistant Secretary of the Corporation and
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms of the series.
The Securities shall be subordinated in right of payment to Senior
Indebtedness as provided in Article XIII.
Section 3.2. Denominations.
The Securities of each series shall be in registered form without coupons
and shall be issuable in denominations of [$25][$1,000] and any integral
multiple of [$25][$1,000] in excess thereof, unless otherwise specified as
contemplated by Section 3.1.
Section 3.3. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Corporation by its
Chairman of the Board, its Vice Chairman of the Board, its President or one of
its Vice Presidents, under its corporate seal reproduced or impressed thereon
and attested by its Secretary or one of its Assistant Secretaries. 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 Corporation shall bind the
Corporation, 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 exe cution and delivery of this Indenture, the
Corporation may deliver Securities of any series executed by the Corporation to
the Trustee for authentication, together with a Corporation Order for the
authentication and delivery of such Securities, and the Trustee in accordance
with the Corporation Order shall authenticate and deliver such Securities. If
the form or terms of the Securities of the series have been established by or
pursuant to one or more Board Resolutions as permitted by Sections 2.1 and 3.1,
in authenticating such Securities, and accepting the additional responsibilities
under this
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<PAGE>
Indenture in relation to such Securities, the Trustee shall be entitled to
receive, and (subject to Section 6.1) shall be fully protected in relying upon,
an Opinion of Counsel stating,
(1) if the form of such Securities has been established by or pursuant
to Board Resolution as permitted by Section 2.1, that such form has been
established in conformity with the provisions of this Indenture;
(2) if the terms of such Securities have been established by or
pursuant to Board Resolution as permitted by Section 3.1, that such terms
have been established in conformity with the provisions of this Indenture;
and
(3) that such Securities, when authenticated and delivered by the
Trustee and issued by the Corporation in the manner and subject to any
conditions specified in such Opinion of Counsel, will constitute valid and
legally binding obligations of the Corporation, subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar
laws of general applicability relating to or affecting creditors' rights
and to general equity principles.
If such form or terms have been so established, the Trustee shall not be
required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will affect the Trustee's own rights, duties,
indemnities or immunities under the Securities and this Indenture or otherwise
in a manner that is not reasonably acceptable to the Trustee.
Notwithstanding the provisions of Section 3.1 and of the preceding
paragraph, if all Securities of a series are not to be originally issued at one
time, it shall not be necessary to deliver the Officers' Certificate otherwise
required pursuant to Section 3.1 or the Corporation Order and Opinion of Counsel
otherwise required pursuant to such preceding paragraph at or prior to the
authentication of each Security of such series if such documents are delivered
at or prior to the authentication upon original issuance of the first Security
of such series to be issued.
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 the manual signature of one of its authorized
officers, and such certificate upon any Security shall be conclusive evidence,
and the only evidence, that such Security has been duly authenticated and
delivered hereunder. Notwithstanding the foregoing, if any Security shall have
been authenticated and delivered hereunder but never issued and sold by the
Corporation, and the Corporation shall deliver such Security to the Trustee for
cancellation as provided in Section 3.10, for all purposes of this Indenture
such Security shall be deemed never to have been authenticated and delivered
hereunder and shall never be entitled to the benefits of this Indenture.
Section 3.4. Temporary Securities.
Pending the preparation of definitive Securities of any series, the
Corporation may execute, and upon Corporation Order the Trustee shall
authenticate and deliver, temporary Securities that are printed, lithographed,
typewritten, mimeographed or otherwise produced, in any denomination,
substantially of the tenor of the definitive Securities of such series in lieu
of which they are issued and
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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 of any series are issued, the Corporation will
cause definitive Securities of such series 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 the office or agency of the Corporation designated for that
purpose without charge to the Holder. Upon surrender for cancellation of any one
or more temporary Securities, the Corporation shall execute and the Trustee
shall authenticate and deliver in exchange therefor one or more definitive
Securities of the same series, of any authorized denominations having the same
Original Issue Date and Stated Maturity and having the same terms as such
temporary Securities. Until so exchanged, the temporary Securities of any series
shall in all respects be entitled to the same benefits under this Indenture as
definitive Securities of such series.
Section 3.5. Global Securities.
(a) Each Global Security issued under this Indenture shall be registered in
the name of the Depositary designated by the Corporation for such Global
Security or a nominee thereof and delivered to such Depositary or a nominee
thereof or custodian therefor, and each such Global Security shall constitute a
single Security for all purposes of this Indenture.
(b) Notwithstanding any other provision in this Indenture, no Global
Security may be exchanged in whole or in part for Securities registered, and no
transfer of a Global Security in whole or in part may be registered, in the name
of any Person other than the Depositary for such Global Security or a nominee
thereof unless (i) such Depositary advises the Trustee in writing that such
Depositary is no longer willing or able to properly discharge its
responsibilities as Depositary with respect to such Global Security, and the
Corporation is unable to locate a qualified successor, (ii) the Corporation
executes and delivers to the Trustee a Corporation Order stating that the
Corporation elects to terminate the book-entry system through the Depositary, or
(iii) there shall have occurred and be continuing an Event of Default.
(c) If any Global Security is to be exchanged for other Securities or
cancelled in whole, it shall be surrendered by or on behalf of the Depositary or
its nominee to the Securities Registrar for exchange or cancellation as provided
in this Article III. If any Global Security is to be exchanged for other
Securities or cancelled in part, or if another Security is to be exchanged in
whole or in part for a beneficial interest in any Global Security, then either
(i) such Global Security shall be so surrendered for exchange or cancellation as
provided in this Article III or (ii) the principal amount thereof shall be
reduced, subject to Section 3.6(b)(v), or increased by an amount equal to the
portion thereof to be so exchanged or cancelled, or equal to the principal
amount of such other Security to be so exchanged for a beneficial interest
therein, as the case may be, by means of an appropriate adjustment made on the
records of the Securities Registrar, whereupon the Trustee, in accordance with
the Applicable Procedures, shall instruct the Depositary or its authorized
representative to make a corresponding adjustment to its records. Upon any such
surrender or adjustment of a Global Security by the Depositary, accompanied by
registration instructions, the Trustee shall, subject to Section 3.5(b) and as
otherwise provided in this Article III, authenticate and deliver any Securities
issuable in exchange for such Global Security (or any portion thereof) in
accordance with the instructions of the Depositary.
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The Trustee shall not be liable for any delay in delivery of such instructions
and may conclusively rely on, and shall be fully protected in relying on, such
instructions.
(d) Every Security authenticated and delivered upon registration of
transfer of, or in exchange for or in lieu of, a Global Security or any portion
thereof, whether pursuant to this Article III, Section 9.6 or 11.6 or otherwise,
shall be authenticated and delivered in the form of, and shall be, a Global
Security, unless such Security is registered in the name of a Person other than
the Depositary for such Global Security or a nominee thereof.
(e) Securities distributed to holders of Book-Entry Capital Securities (as
defined in the applicable Trust Agreement) upon the dissolution of an Issuer
Trust shall be distributed in the form of one or more Global Securities
registered in the name of a Depositary or its nominee, and deposited with the
Securities Registrar, as custodian for such Depositary, or with such Depositary,
for credit by the Depositary to the respective accounts of the beneficial owners
of the Securities represented thereby (or such other accounts as they may
direct). Securities distributed to holders of Capital Securities other than
Book-Entry Capital Securities upon the dissolution of an Issuer Trust shall not
be issued in the form of a Global Security or any other form intended to
facilitate book-entry trading in beneficial interests in such Securities.
(f) The Depositary or its nominee, as the registered owner of a Global
Security, shall be the Holder of such Global Security for all purposes under
this Indenture and the Securities, and owners of beneficial interests in a
Global Security shall hold such interests pursuant to the Applicable Procedures.
Accordingly, any such owner's beneficial interest in a Global Security shall be
shown only on, and the transfer of such interest shall be effected only through,
records maintained by the Depositary or its nominee or its Agent Members.
Neither the Trustee nor the Securities Registrar shall have any liability in
respect of any transfers effected by the Depositary.
(g) The rights of owners of beneficial interests in a Global Security shall
be exercised only through the Depositary and shall be limited to those
established by law and agreements between such owners and the Depositary and/or
its Agent Members.
Section 3.6. Registration, Transfer and Exchange Generally.
The Corporation shall cause to be kept at the Corporate Trust Office of the
Trustee a register in which, subject to such reasonable regulations as it may
prescribe, the Corporation shall provide for the registration of Securities and
of transfers of Securities. Such register is herein sometimes referred to as the
"Securities Register." The Trustee is hereby appointed "Securities Registrar"
for the purpose of registering Securities and transfers of Securities as herein
provided.
Upon surrender for registration of transfer of any Security at the offices
or agencies of the Corporation designated for that purpose the Corporation shall
execute, and the Trustee shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Securities of the same
series of any authorized denominations of like tenor and aggregate principal
amount.
At the option of the Holder, Securities may be exchanged for other
Securities of the same series of any authorized denominations, of like tenor and
aggregate principal amount, upon surrender
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of the Securities to be exchanged at such office or agency. Whenever any
securities are so surrendered for exchange, the Corporation shall execute, and
the Trustee shall authenticate and deliver, the Securities that the Holder
making the exchange is entitled to receive.
All Securities issued upon any transfer or exchange of Securities shall be
the valid obligations of the Corporation, evidencing the same debt, and entitled
to the same benefits under this Indenture, as the Securities surrendered upon
such transfer or exchange.
Every Security presented or surrendered for transfer or exchange shall (if
so required by the Corporation or the Trustee) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Corporation and the Securities Registrar, duly executed by the Holder thereof or
such Holder's attorney duly authorized in writing.
No service charge shall be made to a Holder for any transfer or exchange of
Securities, but the Corporation may require payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in connection with any
transfer or exchange of Securities.
Neither the Corporation nor the Trustee shall be required, pursuant to the
provisions of this Section, (i) to issue, register the transfer of or exchange
any Security of any series during a period beginning at the opening of business
15 days before the day of selection for redemption of Securities of that series
pursuant to Article XI and ending at the close of business on the day of mailing
of the notice of redemption, or (ii) to register the transfer of or exchange any
Security so selected for redemption in whole or in part, except, in the case of
any such Security to be redeemed in part, any portion thereof not to be
redeemed.
Section 3.7. Mutilated, Destroyed, Lost and Stolen Securities.
If any mutilated Security is surrendered to the Trustee together with such
security or indemnity as may be required by the Corporation or the Trustee to
save each of them harmless, the Corporation shall execute and the Trustee shall
authenticate and deliver in exchange therefor a new Security of the same series,
of like tenor and aggregate principal amount and bearing a number not
contemporaneously outstanding.
If there shall be delivered to the Corporation and to 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 harmless, then, in the absence of notice to the Corporation or the
Trustee that such Security has been acquired by a bona fide purchaser, the
Corporation shall execute and upon its written request the Trustee shall
authenticate and deliver, in lieu of any such destroyed, lost or stolen
Security, a new Security of the same series, of like tenor and aggregate
principal amount as such destroyed, lost or stolen Security, and bearing a
number not contemporaneously outstanding.
If any such mutilated, destroyed, lost or stolen Security has become or is
about to become due and payable, the Corporation in its discretion may, instead
of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the Corporation
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in
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relation thereto and any other expenses (including the fees and expenses of the
Trustee) connected therewith.
Every new Security issued pursuant to this Section in lieu of any
destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Corporation, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities of the same series 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 3.8. Payment of Interest and Additional Interest; Interest Rights
Preserved.
Interest and Additional Interest on any Security of any series that 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 in respect of Securities of such series, except
that, unless otherwise provided in the Securities of such series, interest and
any Additional Interest payable on the Stated Maturity of the principal of a
Security shall be paid to the Person to whom principal is paid. The initial
payment of interest on any Security of any series that is issued between a
Regular Record Date and the related Interest Payment Date shall be payable as
provided in such Security or in the Board Resolution pursuant to Section 3.1
with respect to the related series of Securities.
Any interest on any Security that is due and payable, but is not timely
paid or duly provided for, on any Interest Payment Date for Securities of such
series (herein called "Defaulted Interest"), shall forthwith cease to be payable
to the registered Holder on the relevant Regular Record Date by virtue of having
been such Holder, and such Defaulted Interest may be paid by the Corporation, at
its election in each case, as provided in Clause (1) or (2) below:
(1) The Corporation may elect to make payment of any Defaulted Interest to
the Persons in whose names the Securities of such series in respect of which
interest is in default (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
Corporation 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 Corporation 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
Corporation of such Special Record Date and, in the name and at the expense of
the Corporation, 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 of a Security of such series at the address of
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such Holder as it appears in the Securities Register not less than 10 days prior
to such Special Record Date. The Trustee may, in its discretion, in the name and
at the expense of the Corporation, cause a similar notice to be published at
least once in a newspaper, customarily published in the English language on each
Business Day and of general circulation in the Borough of Manhattan, The City of
New York, but such publication shall not be a condition precedent to the
establishment of such Special Record Date. Notice of the proposed payment of
such Defaulted Interest and the Special Record Date therefor having been mailed
as aforesaid, such Defaulted Interest shall be paid to the Persons in whose
names the Securities of such series (or their respective Predecessor Securities)
are registered on such Special Record Date and shall no longer be payable
pursuant to the following Clause (2).
(2) The Corporation 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 of the series in respect of which interest is in default
may be listed and, upon such notice as may be required by such exchange (or by
the Trustee if the Securities are not listed), if, after notice given by the
Corporation to the Trustee of the proposed payment pursuant to this Clause, such
payment shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon 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, that were carried by such other Security.
Section 3.9. Persons Deemed Owners.
The Corporation, the Trustee and any agent of the Corporation or the
Trustee shall treat the Person in whose name any Security is registered as the
owner of such Security for the purpose of receiving payment of principal of and
(subject to Section 3.8) any interest on such Security and for all other
purposes whatsoever, whether or not such Security be overdue, and neither the
Corporation, the Trustee nor any agent of the Corporation or the Trustee shall
be affected by notice to the contrary.
No holder of any beneficial interest in any Global Security held on its
behalf by a Depositary shall have any rights under this Indenture with respect
to such Global Security, and such Depositary may be treated by the Corporation,
the Trustee and any agent of the Corporation or the Trustee as the owner of such
Global Security for all purposes whatsoever. Notwithstanding the foregoing,
nothing herein shall prevent the Corporation, the Trustee or any agent of the
Corporation or the Trustee from giving effect to any written certification,
proxy or other authorization furnished by a Depositary or impair, as between a
Depositary and such holders of beneficial interests, the operation of customary
practices governing the exercise of the rights of the Depositary (or its
nominee) as Holder of any Security.
Section 3.10. Cancellation.
All Securities surrendered for payment, redemption, transfer or exchange
shall, if surrendered to any Person other than the Trustee, be delivered to the
Trustee, and any such Securities and Securities surrendered directly to the
Trustee for any such purpose shall be promptly canceled by it. The Corporation
may at any time deliver to the Trustee for cancellation any Securities
previously authenticated and delivered hereunder that the Corporation may have
acquired in any manner whatsoever, and all Securities so delivered shall be
promptly canceled by the Trustee. No Securities
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shall be authenticated in lieu of or in exchange for any Securities canceled as
provided in this Section, except as expressly permitted by this Indenture. All
canceled Securities shall be destroyed by the Trustee and the Trustee shall
deliver to the Corporation a certificate of such destruction.
Section 3.11. Computation of Interest.
Except as otherwise specified as contemplated by Section 3.1 for Securities
of any series, interest on the Securities of each series for any partial period
shall be computed on the basis of a 360-day year of twelve 30-day months and the
actual number of days elapsed in any partial month in such period, and interest
on the Securities of each series for a full period shall be computed by dividing
the rate per annum by the number of interest periods that together constitute a
full twelve months.
Section 3.12. Deferrals of Interest Payment Dates.
If specified as contemplated by Section 2.1 or Section 3.1 with respect to
the Securities of a particular series, so long as no Event of Default has
occurred and is continuing, the Corporation shall have the right, at any time
during the term of such series, from time to time to defer the payment of
interest on such Securities for such period or periods as may be specified as
contemplated by Section 3.1 (each, an "Extension Period"), during which
Extension Periods the Corporation shall, if so specified as contemplated by
Section 3.1, have the right to make partial payments of interest on any Interest
Payment Date. No Extension Period shall end on a date other than an Interest
Payment Date. At the end of any such Extension Period the Corporation shall pay
all interest then accrued and unpaid on the Securities (together with Additional
Interest thereon, if any, at the rate specified for the Securities of such
series to the extent permitted by applicable law); provided, however, that no
Extension Period shall extend beyond the Stated Maturity of the principal of the
Securities of such series; and provided further, however that during any such
Extension Period, the Corporation shall not (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire or make a liquidation payment
with respect to, any of the Corporation's capital stock, or (ii) make any
payment of principal of or interest or premium, if any, on or repay, repurchase
or redeem any debt securities of the Corporation that rank pari passu in all
respects with or junior in interest to the Securities of such series (other than
(a) repurchases, redemptions or other acquisitions of shares of capital stock of
the Corporation 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, in connection with a dividend reinvestment
or stockholder stock purchase plan or in connection with the issuance of capital
stock of the Corporation (or securities convertible into or exercisable for such
capital stock) as consideration in an acquisition transaction entered into prior
to the applicable Extension Period, (b) as a result of an exchange or conversion
of any class or series of the Corporation's capital stock (or any capital stock
of a Subsidiary of the Corporation) for any class or series of the Corporation's
capital stock or of any class or series of the Corporation's indebtedness for
any class or series of the Corporation's capital stock, (c) the purchase of
fractional interests in shares of the Corporation's capital stock pursuant to
the conversion or exchange provisions of such capital stock or the security
being converted or exchanged, (d) any declaration of a dividend in connection
with any Rights Plan, or the issuance of rights, stock or other property under
any 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 Corporation may further defer the
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payment of interest, provided that no Extension Period shall exceed the period
or periods specified in such Securities, extend beyond the Stated Maturity of
the principal of such Securities or end on a date other than an Interest Payment
Date. Upon the termination of any such Extension Period and upon the payment of
all accrued and unpaid interest and any Additional Interest then due on any
Interest Payment Date, the Corporation may elect to begin a new Extension
Period, subject to the above conditions. No interest or Additional Interest
shall be due and payable during an Extension Period, except at the end thereof,
but each installment of interest that would otherwise have been due and payable
during such Extension Period shall bear Additional Interest as and to the extent
as may be specified as contemplated by Section 3.1. The Corporation shall give
the Holders of the Securities of such series and the Trustee written notice of
its election to begin any such Extension Period at least one Business Day prior
to the next succeeding Interest Payment Date on which interest on Securities of
such series would be payable but for such deferral or, with respect to any
Securities of a series issued to an Issuer Trust, so long as any such Securities
are held by such Issuer Trust, at least one Business Day prior to the earlier of
(i) the next succeeding date on which Distributions on the Capital Securities of
such Issuer Trust would be payable but for such deferral, and (ii) the date on
which the Property Trustee of such Issuer Trust is required to give notice to
any securities exchange or other applicable self-regulatory organization or to
holders of such Capital Securities of the record date or the date such
Distributions are payable.
The Trustee shall promptly give notice of the Corporation's election to
begin any such Extension Period to the Holders of the Outstanding Securities of
such series.
Section 3.13. Right of Set-Off.
With respect to the Securities of a series initially issued to an Issuer
Trust, notwithstanding anything to the contrary herein, the Corporation shall
have the right to set off any payment it is otherwise required to make in
respect of any such Security to the extent the Corporation has theretofore made,
or is concurrently on the date of such payment making, a payment under the
Guarantee Agreement relating to such Security or to a holder of Capital
Securities pursuant to an action undertaken under Section 5.8 of this Indenture.
Section 3.14. Agreed Tax Treatment.
Each Security issued hereunder shall provide that the Corporation and, by
its acceptance or acquisition of a Security or a beneficial interest therein,
the Holder of, and any Person that acquires a direct or indirect beneficial
interest in, such Security, agree to treat such Security as indebtedness of the
Corporation for United States Federal, state and local tax purposes and, with
respect to Securities of a series issued to an Issuer Trust, to treat Capital
Securities of such Issuer Trust (including but not limited to all payments and
proceeds with respect to such Capital Securities) as an undivided beneficial
ownership interest in the Securities (and payments and proceeds therefrom,
respectively) for United States Federal, state and local tax purposes.
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Section 3.15. Shortening of Stated Maturity.
If specified as contemplated by Section 2.1 or Section 3.1 with respect to
the Securities of a particular series, the Corporation shall have the right to
shorten the Stated Maturity of the principal of the Securities of such series at
any time to any date not earlier than the first date on which the Corporation
has the right to redeem the Securities of such series. In the event that the
Corporation elects to shorten the Stated Maturity of the Securities of such
series, it shall give written notice to the Trustee.
Section 3.16. CUSIP Numbers.
The Corporation 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 and other similar or related materials as a convenience to
Holders; provided that any such notice or other materials 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 redemption or other materials
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.
ARTICLE IV
Satisfaction and Discharge
Section 4.1. Satisfaction and Discharge of Indenture.
This Indenture shall, upon Corporation Request, 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 as otherwise provided
in this Section 4.1) and the Trustee, on demand of and at the expense of the
Corporation, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and delivered (other than
(i) Securities that have been destroyed, lost or stolen and that have been
replaced or paid as provided in Section 3.7 and (ii) Securities for whose
payment money has theretofore been deposited in trust or segregated and
held in trust by the Corporation and thereafter repaid to the Corporation
or discharged from such trust, as provided in Section 10.3) 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 Stated Maturity within one
year of the date of deposit, or
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(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of
notice of redemption by the Trustee in the name, and at the
expense, of the Corporation,
and the Corporation, in the case of subclause (B)(i), (ii) or (iii) above,
has deposited or caused to be deposited with the Trustee as trust funds in
trust for such purpose an amount in the currency or currencies in which the
Securities of such series are payable sufficient to pay and discharge the
entire indebtedness on such Securities not theretofore delivered to the
Trustee for cancellation, for principal (and premium, if any) and interest
(including any Additional Interest) to the date of such deposit (in the
case of Securities that have become due and payable) or to the Stated
Maturity or Redemption Date, as the case may be;
(2) the Corporation has paid or caused to be paid all other sums payable
hereunder by the Corporation; and
(3) the Corporation 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 Corporation to the Trustee under Section 6.7, the obligations
of the Trustee to any Authenticating Agent under Section 6.14 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 4.2 and the
last paragraph of Section 10.3 shall survive.
Section 4.2. Application of Trust Money.
Subject to the provisions of the last paragraph of Section 10.3, all money
deposited with the Trustee pursuant to Section 4.1 shall be held in trust and
applied by the Trustee, in accordance with the provisions of the Securities and
this Indenture, to the payment, either directly or through any Paying Agent
(including the Corporation acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium, if
any) and interest (including any Additional Interest) for the payment of which
such money or obligations have been deposited with or received by the Trustee.
ARTICLE V
Remedies
Section 5.1. Events of Default.
"Event of Default", wherever used herein with respect to the Securities of
any series, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body) except
as may be specified pursuant to Section 3.1:
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(1) default in the payment of any interest upon any Security of that
series, including any Additional Interest in respect thereof, when it becomes
due and payable, and continuance of such default for a period of 30 days
(subject to the deferral of any due date in the case of an Extension Period); or
(2) default in the payment of the principal of (or premium, if any, on) any
Security of that series at its Maturity; or
(3) failure on the part of the Corporation duly to observe or perform any
other of the covenants or agreements on the part of the Corporation in the
Securities of that series or in this Indenture for a period of 90 days after the
date on which written notice of such failure, requiring the Corporation to
remedy the same, shall have been given to the Corporation by the Trustee by
registered or certified mail or to the Corporation and the Trustee by the
Holders of at least 25% in aggregate principal amount of the Outstanding
Securities of that series; or
(4) the entry of a decree or order by a court having jurisdiction in the
premises adjudging the Corporation a bankrupt or insolvent, or approving as
properly filed a petition seeking reorganization of the Corporation under the
Bankruptcy Code or any other similar applicable Federal or State law, which
decree or order shall have continued undischarged and unstayed for a period of
60 days; or the entry of a decree or order of a court having jurisdiction in the
premises for the appointment of a receiver or liquidator or trustee or assignee
in bankruptcy or insolvency of the Corporation or of its property, or for the
winding up or liquidation of its affairs, which decree or order shall have
continued undischarged and unstayed for a period of 60 days; or
(5) the commencement by the Corporation of voluntary proceedings to be
adjudicated a bankrupt, or consent by the Corporation to the filing of a
bankruptcy proceeding against it, or the filing by the Corporation of a petition
or answer or consent seeking reorganization under the Bankruptcy Code or any
other similar Federal or State law, or consent by the Corporation to the filing
of any such petition, or the consent by the Corporation to the appointment of a
receiver or liquidator or trustee or assignee in bankruptcy or insolvency of it
or of its property, or the making by the Corporation of an assignment for the
benefit of creditors, or the admission by the Corporation in writing of its
inability to pay its debts generally as they become due; or
(6) any other Event of Default provided with respect to Securities of that
series.
Section 5.2. Acceleration of Maturity; Rescission and Annulment.
If an Event of Default (other than an Event of Default specified in Section
5.1(4) or 5.1(5)) with respect to Securities of any series at the time
Outstanding 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 of that series may declare the principal amount (or, if
the Securities of that series are Discount Securities, such portion of the
principal amount as may be specified in the terms of that series) of all the
Securities of that series to be due and payable immediately, by a notice in
writing to the Corporation (and to the Trustee if given by Holders), provided
that, in the case of the Securities of a series issued to an Issuer Trust, if,
upon an Event of Default, the Trustee or the Holders of not less than 25% in
principal amount of the Outstanding Securities of such series fail to declare
the principal of all the Outstanding Securities of such series to be immediately
due and payable, the holders
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of at least 25% in aggregate Liquidation Amount (as defined in the related Trust
Agreement) of the related series of Capital Securities issued by such Issuer
Trust then outstanding shall have the right to make such declaration by a notice
in writing to the Corporation and the Trustee; and upon any such declaration
such principal amount (or specified portion thereof) of and the accrued interest
(including any Additional Interest) on all the Securities of such series shall
become immediately due and payable. If an Event of Default specified in Section
5.1(4) or 5.1(5) with respect to Securities of any series at the time
Outstanding occurs, the principal amount of all the Securities of such series
(or, if the Securities of such series are Discount Securities, such portion of
the principal amount of such Securities as may be specified by the terms of that
series) shall automatically, and without any declaration or other action on the
part of the Trustee or any Holder, become immediately due and payable. Payment
of principal and interest (including any Additional Interest) on such Securities
shall remain subordinated to the extent provided in Article XIII notwithstanding
that such amount shall become immediately due and payable as herein provided.
At any time after such a declaration of acceleration with respect to
Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in this
Article provided, the Holders of a majority in aggregate principal amount of the
Outstanding Securities of that series, by written notice to the Corporation and
the Trustee, may rescind and annul such declaration and its consequences if:
(1) the Corporation has paid or deposited with the Trustee a sum sufficient
to pay:
(A) all overdue installments of interest on all Securities of such series,
(B) any accrued Additional Interest on all Securities of such series,
(C) the principal of (and premium, if any, on) any Securities of such
series that have become due otherwise than by such declaration of acceleration
and interest and Additional Interest thereon 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 with respect to Securities of that series, other
than the non-payment of the principal of Securities of that series that has
become due solely by such acceleration, have been cured or waived as provided in
Section 5.13.
In the case of Securities of a series initially issued to an Issuer Trust,
if the Holders of such Securities fail to annul such declaration and waive such
default, the holders of a majority in aggregate Liquidation Amount (as defined
in the related Trust Agreement) of the related series of Capital Securities
issued by such Issuer Trust then outstanding shall also have the right to
rescind and annul such declaration and its consequences by written notice to the
Corporation and the Trustee, subject to the satisfaction of the conditions set
forth in Clauses (1) and (2) above of this Section 5.2.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
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Section 5.3. Collection of Indebtedness and Suits for Enforcement by
Trustee.
The Corporation covenants that if:
(1) default is made in the payment of any installment of interest
(including any Additional Interest) on any Security of any series 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 (and premium, if
any, on) any Security at the Maturity thereof,
the Corporation will, upon demand of the Trustee, pay to the Trustee, for the
benefit of the Holders of such Securities, the whole amount then due and payable
on such Securities for principal, including any sinking fund payment or
analogous obligations (and premium, if any) and interest (including any
Additional Interest), and, in addition thereto, all amounts owing the Trustee
under Section 6.7.
If the Corporation fails to pay such amounts forthwith upon such demand,
the Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, and may
prosecute such proceeding to judgment or final decree, and may enforce the same
against the Corporation or any other obligor upon such Securities and collect
the moneys adjudged or decreed to be payable in the manner provided by law out
of the property of the Corporation or any other obligor upon the Securities,
wherever situated.
If an Event of Default with respect to Securities of any series occurs and
is continuing, the Trustee may in its discretion proceed to protect and enforce
its rights and the rights of the Holders of Securities of such series 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.
Section 5.4. Trustee May File Proofs of Claim.
In case of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Corporation or any other obligor upon the Securities
or the property of the Corporation or of such other obligor or their creditors,
(a) the Trustee (irrespective of whether the principal of the
Securities of any series shall then be due and payable as therein expressed
or by declaration or otherwise and irrespective of whether the Trustee
shall have made any demand on the Corporation for the payment of overdue
principal (and premium, if any) or interest (including any Additional
Interest)) shall be entitled and empowered, by intervention in such
proceeding or otherwise,
(i) to file and prove a claim for the whole amount of principal
(and premium, if any) and interest (including any Additional Interest)
owing and unpaid in respect to the Securities and to file such other
papers or documents as may be necessary or advisable and to take any
and all actions as are authorized under the Trust Indenture Act in
order
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to have the claims of the Holders and any predecessor to the
Trustee under Section 6.7 allowed in any such judicial proceedings;
and
(ii) 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 in accordance with Section 5.6;
and
(b) 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 for
distribution in accordance with Section 5.6, 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 to it and any predecessor
Trustee under Section 6.7.
Nothing herein contained 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; provided, however,
that the Trustee may, on behalf of the Holders, vote for the election of a
trustee in bankruptcy or similar official and be a member of a creditors' or
other similar committee.
Section 5.5. Trustee May Enforce Claim Without Possession of Securities.
All rights of action and claims under this Indenture or the Securities may
be prosecuted and enforced by the Trustee 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 an express trust, and any recovery of judgment shall, subject to
Article XIII and after provision for the payment of all the amounts owing the
Trustee and any predecessor Trustee under Section 6.7, 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 5.6. Application of Money Collected.
Any money or property collected or to be applied by the Trustee with
respect to a series of Securities 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 or property on account of principal (or premium,
if any) or interest (including any Additional Interest), 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 and any predecessor
Trustee under Section 6.7;
SECOND: Subject to Article XIII, to the payment of the amounts then due and
unpaid upon Securities of such series for principal (and premium, if any) and
interest (including any Additional Interest) 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 on such series of
Securities for principal (and premium, if any) and interest (including any
Additional Interest), respectively; and
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THIRD: The balance, if any, to the Person or Persons entitled thereto.
Section 5.7. Limitation on Suits.
Subject to Section 5.8, no Holder of any Securities of any series shall
have any right to institute any proceeding, judicial or otherwise, with respect
to this Indenture or for the appointment of a receiver, assignee, trustee,
liquidator, sequestrator (or other similar official) or for any other remedy
hereunder, unless:
(1) such Holder has previously given written notice to the Trustee of a
continuing Event of Default with respect to the Securities of that series;
(2) the Holders of not less than 25% in aggregate principal amount of the
Outstanding Securities of that series shall have made written request to the
Trustee to institute proceedings in respect of such Event of Default in its own
name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee reasonable indemnity
against the costs, expenses and liabilities to be incurred in compliance with
such request;
(4) the Trustee for 60 days after its receipt of such notice, request and
offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been given to
the Trustee during such 60-day period by the Holders of a majority in aggregate
principal amount of the Outstanding Securities of that series;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing itself of, any
provision of this Indenture to affect, disturb or prejudice the rights of any
other Holders of Securities, or to obtain or to seek to obtain priority or
preference over any other of such Holders or to enforce any right under this
Indenture, except in the manner herein provided and for the equal and ratable
benefit of all such Holders.
Section 5.8. Unconditional Right of Holders to Receive Principal, Premium
and Interest; Direct Action by Holders of Capital Securities.
Notwithstanding any other provision in this Indenture, the Holder of any
Security of any series shall have the right, which is absolute and
unconditional, to receive payment of the principal of (and premium, if any) and
(subject to Sections 3.8 and 3.12) interest (including any Additional Interest)
on such Security on the respective Stated Maturities 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 right shall not be impaired
without the consent of such Holder. In the case of Securities of a series issued
to an Issuer Trust, any registered holder of the series of Capital Securities
issued by such Issuer Trust shall have the right, upon the occurrence of an
Event of Default described in Section 5.1(1) or 5.1(2), to institute a suit
directly against the Corporation for enforcement of payment to such holder of
principal of (premium, if any) and (subject to Sections 3.8 and 3.12) interest
(including any Additional Interest) on the Securities having a principal amount
equal to the aggregate
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Liquidation Amount (as defined in the related Trust Agreement) of such Capital
Securities held by such holder.
Section 5.9. Restoration of Rights and Remedies.
If the Trustee, any Holder or any holder of Capital Securities issued by
any Issuer Trust 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, such Holder or such
holder of Capital Securities, then and in every such case the Corporation, the
Trustee, such Holders and such holder of Capital Securities shall, subject to
any determination in such proceeding, be restored severally and respectively to
their former positions hereunder, and thereafter all rights and remedies of the
Trustee, such Holder and such holder of Capital Securities shall continue as
though no such proceeding had been instituted.
Section 5.10. Rights and Remedies Cumulative.
Except as otherwise provided in the last paragraph of Section 3.7, no right
or remedy herein conferred upon or reserved to the Trustee or 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 5.11. Delay or Omission Not Waiver.
No delay or omission of the Trustee, any Holder of any Security with
respect to the Securities of the related Series or any holder of any Capital
Security to exercise any right or remedy accruing upon any Event of Default with
respect to the Securities of the related series 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 and the right and remedy given to the holders of Capital Securities
by Section 5.8 may be exercised from time to time, and as often as may be deemed
expedient, by the Trustee, the Holders or the holders of Capital Securities, as
the case may be.
Section 5.12. Control by Holders.
The Holders of not less than a majority in aggregate principal amount of
the Outstanding Securities of any series 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, with
respect to the Securities of such series, provided that:
(1) such direction shall not be in conflict with any rule of law or with
this Indenture,
(2) the Trustee may take any other action deemed proper by the Trustee that
is not inconsistent with such direction, and
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(3) subject to the provisions of Section 6.1, the Trustee shall have the
right to decline to follow such direction if a Responsible Officer or Officers
of the Trustee shall, in good faith, determine that the proceeding so directed
would be unjustly prejudicial to the Holders not joining in any such direction
or would involve the Trustee in personal liability.
Section 5.13. Waiver of Past Defaults.
The Holders of not less than a majority in aggregate principal amount of
the Outstanding Securities of any series affected thereby and, in the case of
any Securities of a series initially issued to an Issuer Trust, the holders of a
majority in aggregate Liquidation Amount (as defined in the related Trust
Agreement) of the Capital Securities issued by such Issuer Trust may waive any
past default hereunder and its consequences with respect to such series except a
default:
(1) in the payment of the principal of (or premium, if any) or interest
(including any Additional Interest) on any Security of such series (unless such
default has been cured and the Corporation has paid to or deposited with the
Trustee a sum sufficient to pay all matured installments of interest (including
any Additional Interest) and all principal of (and premium, if any, on) all
Securities of that series due otherwise than by acceleration), or
(2) in respect of a covenant or provision hereof that under Article IX
cannot be modified or amended without the consent of each Holder of any
Outstanding Security of such series affected.
Any such waiver shall be deemed to be on behalf of the Holders of all the
Securities of such series or, in the case of a waiver by holders of Capital
Securities issued by such Issuer Trust, by all holders of Capital Securities
issued by such Issuer Trust.
Upon any such waiver, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
default or impair any right consequent thereon.
Section 5.14. Undertaking for Costs.
All parties to this Indenture agree, and each Holder of any Security by his
acceptance thereof shall be deemed to have agreed, that any court may in its
discretion require, in any suit for the enforcement of any right or remedy under
this Indenture, or in any suit against the Trustee for any action taken or
omitted by it as Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees and
expenses, against any party litigant in such suit, having due regard to the
merits and good faith of the claims or defenses made by such party litigant; but
the provisions of this Section shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Holder, or group of Holders, holding in
the aggregate more than 10% in aggregate principal amount of the Outstanding
Securities of any series, or to any suit instituted by any Holder for the
enforcement of the payment of the principal of (or premium, if any) or interest
(including any Additional Interest) on any Security on or after the respective
Stated Maturities expressed in such Security.
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Section 5.15. Waiver of Usury, Stay or Extension Laws.
The Corporation 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 usury, 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 Corporation (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 VI
The Trustee
Section 6.1. Certain Duties and Responsibilities.
(a) Except during the continuance of an Event of Default,
(1) the Trustee undertakes to perform such duties and only such duties as
are specifically set forth in this Indenture, and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may conclusively
rely, as to the truth of the statements and the correctness of the opinions
expressed therein, upon certificates or opinions furnished to the Trustee and
conforming to the requirements of this Indenture; but in the case of any such
certificates or opinions that by any provisions hereof are specifically required
to be furnished to the Trustee, the Trustee shall be under a duty to examine the
same to determine whether or not they conform to the requirements of this
Indenture.
(b) In case an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in their exercise, as a prudent person
would exercise or use under the circumstances in the conduct of his or her own
affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct except that
(1) this Subsection shall not be construed to limit the effect of
Subsection (a) of this Section;
(2) the Trustee shall not be liable for any error of judgment made in good
faith by a Responsible Officer, unless it shall be proved that the Trustee was
negligent in ascertaining the pertinent facts; and
(3) 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
Holders pursuant to Section 5.12 relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
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any trust or power conferred upon the Trustee, under this Indenture with respect
to the Securities of a series.
(d) 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 there shall be reasonable grounds for believing that repayment of
such funds or adequate indemnity against such risk or liability is not
reasonably assured to it.
(e) Whether or not therein expressly so provided, every provision of this
Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section.
Section 6.2. Notice of Defaults.
Within 90 days after actual knowledge by a Responsible Officer of the
Trustee of the occurrence of any default hereunder with respect to the
Securities of any series, the Trustee shall transmit by mail to all Holders of
Securities of such series, as their names and addresses appear in the Securities
Register, notice of such default, unless such default shall have been cured or
waived; provided, however, that, except in the case of a default in the payment
of the principal of (or premium, if any) or interest (including any Additional
Interest) on any Security of such series, the Trustee shall be fully protected
in withholding such notice if and so long as the board of directors, the
executive committee or a trust committee of directors and/or Responsible
Officers of the Trustee in good faith determines that the withholding of such
notice is in the interests of the Holders of Securities of such series; and
provided, further, that, in the case of any default of the character specified
in Section 5.1(3), no such notice to Holders of Securities of such series shall
be given until at least 30 days after the occurrence thereof. For the purpose of
this Section, the term "default" means any event that is, or after notice or
lapse of time or both would become, an Event of Default with respect to
Securities of such series.
Section 6.3. Certain Rights of Trustee.
Subject to the provisions of Section 6.1:
(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, Security 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 Corporation mentioned herein shall be
sufficiently evidenced by a Corporation Request or Corporation Order and any
resolution of the Board of Directors may be sufficiently evidenced by a Board
Resolution;
(c) whenever in the administration of this Indenture the Trustee shall deem
it desirable that a matter be proved or established prior to taking, suffering
or omitting any action hereunder, the Trustee (unless other evidence be herein
specifically prescribed) may, in the absence of bad faith on its part,
conclusively rely upon an Officers' Certificate;
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(d) the Trustee may consult with counsel and the advice of such counsel or
any Opinion of Counsel shall be full and complete authorization and protection
in respect of any action taken, suffered or omitted by it hereunder in good
faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request or direction of any of
the Holders pursuant to this Indenture, unless such Holders shall have offered
to the Trustee reasonable security or indemnity against the costs, expenses and
liabilities that 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, indenture,
Security or other paper or document, but the Trustee in its discretion may make
such inquiry or investigation into such facts or matters as it may see fit, and,
if the Trustee shall determine to make such inquiry or investigation, it shall
be entitled to examine the books, records and premises of the Corporation,
personally or by agent or attorney; and
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents, attorneys,
custodians or nominees and the Trustee shall not be responsible for any
misconduct or negligence on the part of any agent, attorney, custodian or
nominee appointed with due care by it hereunder.
(h) in the event that the Trustee is also acting as Paying Agent,
Authenticating Agent or Transfer Agent and Registrar hereunder, the rights and
protections afforded to the Trustee pursuant to this Article VI shall also be
afforded such Paying Agent or Transfer Agent and Registrar.
Section 6.4. 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
Corporation, and neither the Trustee nor any Authenticating Agent assumes any
responsibility for their correctness. The Trustee makes no representations as to
the validity or sufficiency of this Indenture or of the Securities. Neither the
Trustee nor any Authenticating Agent shall be accountable for the use or
application by the Corporation of the Securities or the proceeds thereof.
Section 6.5. May Hold Securities.
The Trustee, any Authenticating Agent, any Paying Agent, any Securities
Registrar or any other agent of the Corporation, in its individual or any other
capacity, may become the owner or pledgee of Securities and, subject to Sections
6.8 and 6.13, may otherwise deal with the Corporation with the same rights it
would have if it were not Trustee, Authenticating Agent, Paying Agent,
Securities Registrar or such other agent.
Section 6.6. 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 with the Corporation.
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Section 6.7. Compensation and Reimbursement.
The Corporation agrees
(1) to pay to the Trustee from time to time reasonable compensation for all
services rendered by it hereunder in such amounts as the Corporation and the
Trustee shall agree from time to time (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 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 the Trustee and its officers, directors, agents and
employees for, and to hold it harmless against, any loss, liability or expense
(including the reasonable compensation and the expenses and disbursements of its
agents and counsel) incurred without negligence or bad faith, arising out of or
in connection with the acceptance or administration of this trust or the
performance of its duties 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. This indemnification
shall survive the termination of this Indenture or the earlier resignation or
removal of the Trustee.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 5.1(4) or 5.1(5) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under the Bankruptcy Reform Act of 1978 or any successor statute.
Section 6.8. Disqualification; Conflicting Interests.
(a) The Trustee for the Securities of any series issued hereunder shall be
subject to the provisions of Section 310(b) of the Trust Indenture Act. Nothing
herein shall prevent the Trustee from filing with the Commission the application
referred to in the second to last paragraph of said Section 310(b).
(b) The Trust Agreement and the Guarantee Agreement with respect to each
Issuer Trust shall be deemed to be specifically described in this Indenture for
the purposes of clause (i) of the first proviso contained in Section 310(b) of
the Trust Indenture Act.
Section 6.9. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which shall be:
(a) a corporation organized and doing business under the laws of the United
States of America or of any State or Territory or the District of Columbia,
authorized under such laws to exercise corporate trust powers and subject to
supervision or examination by Federal, State, Territorial or District of
Columbia authority, or
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(b) a corporation or other Person organized and doing business under the
laws of a foreign government that is permitted to act as Trustee pursuant to a
rule, regulation or order of the Commission, authorized under such laws to
exercise corporate trust powers, and subject to supervision or examination by
authority of such foreign government or a political subdivision thereof
substantially equivalent to supervision or examination applicable to United
States institutional trustees, in either case having a combined capital and
surplus of at least $50,000,000, subject to supervision or examination by
Federal or State authority. If such corporation publishes reports of condition
at least annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then, for the purposes of this Section 6.9,
the combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. If at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section 6.9, it shall resign immediately
in the manner and with the effect hereinafter specified in this Article VI.
Neither the Corporation nor any Person directly or indirectly controlling,
controlled by or under common control with the Corporation shall serve as
Trustee for the Securities of any series issued hereunder.
Section 6.10. 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 VI shall become effective until the
acceptance of appointment by the successor Trustee under Section 6.11.
(b) The Trustee may resign at any time with respect to the Securities of
one or more series by giving written notice thereof to the Corporation. 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 with respect to the Securities of such
series.
(c) The Trustee may be removed at any time with respect to the Securities
of any series by Act of the Holders of a majority in aggregate principal amount
of the Outstanding Securities of such series, delivered to the Trustee and to
the Corporation.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 6.8 after written request
therefor by the Corporation 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 6.9 and shall fail
to resign after written request therefor by the Corporation 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,
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then, in any such case, (i) the Corporation, acting pursuant to the authority of
a Board Resolution, may remove the Trustee with respect to the Securities of all
series issued hereunder, or (ii) subject to Section 5.14, any Holder who has
been a bona fide Holder of a Security for at least six months may, on behalf of
such Holder and all others similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee with respect to the Securities of
all series issued hereunder and the appointment of a successor Trustee or
Trustees.
(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 with respect
to the Securities of one or more series, the Corporation, by a Board Resolution,
shall promptly appoint a successor Trustee with respect to the Securities of
that or those series. If, within one year after such resignation, removal or
incapability, or the occurrence of such vacancy, a successor Trustee with
respect to the Securities of any series shall be appointed by Act of the Holders
of a majority in aggregate principal amount of the Outstanding Securities of
such series delivered to the Corporation and the retiring Trustee, the successor
Trustee so appointed shall, forthwith upon its acceptance of such appointment,
become the successor Trustee with respect to the Securities of such series and
supersede the successor Trustee appointed by the Corporation. If no successor
Trustee with respect to the Securities of any series shall have been so
appointed by the Corporation or the Holders and accepted appointment in the
manner hereinafter provided, any Holder who has been a bona fide Holder of a
Security of such series for at least six months may, subject to Section 5.14, on
behalf of such Holder and all others similarly situated, petition any court of
competent jurisdiction for the appointment of a successor Trustee with respect
to the Securities of such series.
(f) The Corporation shall give notice of each resignation and each removal
of the Trustee with respect to the Securities of any series and each appointment
of a successor Trustee with respect to the Securities of any series by mailing
written notice of such event by first-class mail, postage prepaid, to the
Holders of Securities of such series as their names and addresses appear in the
Securities Register. Each notice shall include the name of the successor Trustee
with respect to the Securities of such series and the address of its Corporate
Trust Office.
Section 6.11. Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor Trustee with
respect to all Securities, every such successor Trustee so appointed shall
execute, acknowledge and deliver to the Corporation 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; but, on the
request of the Corporation 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.
(b) In case of the appointment hereunder of a successor Trustee with
respect to the Securities of one or more (but not all) series, the Corporation,
the retiring Trustee and each successor Trustee with respect to the Securities
of one or more series shall execute and deliver an indenture supplemental hereto
wherein each successor Trustee shall accept such appointment and which (1) shall
contain such provisions as shall be necessary or desirable to transfer and
confirm to, and to vest in, each successor
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Trustee all the rights, powers, trusts and duties of the retiring Trustee with
respect to the Securities of that or those series to which the appointment of
such successor Trustee relates, (2) if the retiring Trustee is not retiring with
respect to all Securities, shall contain such provisions as shall be deemed
necessary or desirable to confirm that all the rights, powers, trusts and duties
of the retiring Trustee with respect to the Securities of that or those series
as to which the retiring Trustee is not retiring shall continue to be vested in
the retiring Trustee, and (3) shall add to or change any of the provisions of
this Indenture as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one Trustee, it being
understood that nothing herein or in such supplemental indenture shall
constitute such Trustees co-trustees of the same trust and that each such
Trustee shall be trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by any other such Trustee; and upon
the execution and delivery of such supplemental indenture the resignation or
removal of the retiring Trustee shall become effective to the extent provided
therein and each 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 with respect to the Securities of that or those series
to which the appointment of such successor Trustee relates; but, on request of
the Corporation or any successor Trustee, such retiring Trustee shall duly
assign, transfer and deliver to such successor Trustee all property and money
held by such retiring Trustee hereunder with respect to the Securities of that
or those series to which the appointment of such successor Trustee relates.
(c) Upon request of any such successor Trustee, the Corporation shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all rights, powers and trusts referred to
in paragraph (a) or (b) of this Section, as the case may be.
(d) No successor Trustee shall accept its appointment unless at the time of
such acceptance such successor Trustee shall be qualified and eligible under
this Article.
Section 6.12. 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 of 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 delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated, and in case any
Securities shall not have been authenticated, any successor to the Trustee may
authenticate such Securities either in the name of any predecessor Trustee or in
the name of such successor Trustee, and in all cases the certificate of
authentication shall have the full force which it is provided anywhere in the
Securities or in this Indenture that the certificate of the Trustee shall have.
Section 6.13. Preferential Collection of Claims Against Corporation.
If and when the Trustee shall be or become a creditor of the Corporation
(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 Corporation (or any such other obligor).
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Section 6.14. Appointment of Authenticating Agent.
The Trustee may appoint an Authenticating Agent or Agents with respect to
one or more series of Securities, which shall be authorized to act on behalf of
the Trustee to authenticate Securities of such series issued upon original issue
and upon exchange, registration of transfer or partial redemption thereof or
pursuant to Section 3.6, and Securities so authenticated shall be entitled to
the benefits of this Indenture and shall be valid and obligatory for all
purposes as if authenticated by the Trustee hereunder. Wherever reference is
made in this Indenture to the authentication and delivery of Securities by the
Trustee or the Trustee's certificate of authentication, such reference shall be
deemed to include authentication and delivery on behalf of the Trustee by an
Authenticating Agent. Each Authenticating Agent shall be acceptable to the
Corporation and shall at all times be a corporation organized and doing business
under the laws of the United States of America, or of any State or Territory
thereof or the District of Columbia, authorized under such laws to act as
Authenticating Agent, having a combined capital and surplus of not less than
$50,000,000 and subject to supervision or examination by Federal or State
authority. If such Authenticating Agent 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 Authenticating Agent shall be deemed to be its combined
Capital and surplus as set forth in its most recent report of condition so
published. If at any time an Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section, such Authenticating Agent shall
resign immediately in the manner and with the effect specified in this Section.
Any corporation into which an Authenticating Agent 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 Authenticating Agent
shall be a party, or any corporation succeeding to all or substantially all of
the corporate trust business of an Authenticating Agent shall be the successor
Authenticating Agent hereunder, provided such corporation shall be otherwise
eligible under this Section, without the execution or filing of any paper or any
further act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Corporation. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice thereof
to such Authenticating Agent and to the Corporation. Upon receiving such a
notice of resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent, which shall be acceptable to the Corporation and shall give notice of
such appointment in the manner provided in Section 1.6 to all Holders of
Securities of the series with respect to which such Authenticating Agent will
serve. Any successor Authenticating Agent upon acceptance of its appointment
hereunder shall become vested with all the rights, powers and duties of its
predecessor hereunder, with like effect as if originally named as an
Authenticating Agent. No successor Authenticating Agent shall be appointed
unless eligible under the provision of this Section.
The Trustee agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section, and the Trustee
shall be entitled to be reimbursed for such payments, subject to the provisions
of Section 6.7.
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If an appointment with respect to one or more series is made pursuant to
this Section, the Securities of such series may have endorsed thereon, in
addition to the Trustee's certificate of authentication, an alternative
certificate of authentication in the following form:
This is one of the Securities of the series designated therein referred to
in the within mentioned Indenture.
Dated:
Bankers Trust Company,
As Trustee
By:
As Authenticating Agent
By:
Authorized Officer
ARTICLE VII
Holder's Lists and Reports by Trustee And Corporation
Section 7.1. Corporation to Furnish Trustee Names and Addresses of Holders.
The Corporation will furnish or cause to be furnished to the Trustee:
(a) semi-annually, on or before June 30 and December 31 of each year,
a list, in such form as the Trustee may reasonably require, of the names
and addresses of the Holders 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 Corporation 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,
in each case to the extent such information is in the possession or control of
the corporation and has not otherwise been received by the Trustee in its
capacity as Securities Registrar.
Section 7.2. 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 7.1 and the names and
addresses of Holders received by the Trustee in its capacity as
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Securities Registrar. The Trustee may destroy any list furnished to it as
provided in Section 7.1 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 privileges of the Trustee, shall be as provided in the Trust
Indenture Act.
(c) Every Holder of Securities, by receiving and holding the same, agrees
with the Corporation and the Trustee that neither the Corporation nor the
Trustee nor any agent of either of them shall be held accountable by reason of
the disclosure of information as to the names and addresses of the Holders made
pursuant to the Trust Indenture Act.
Section 7.3. Reports by Trustee.
(a) The Trustee shall transmit to Holders 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) Reports so required to be transmitted at stated intervals of not more
than 12 months shall be transmitted no later than January 31 in each calendar
year, commencing with January 31, 1999 after the first issuance of Securities
under this Indenture.
(c) A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Trustee with each securities exchange upon which any
Securities are listed and also with the Commission. The Corporation will notify
the Trustee when any Securities are listed on any securities exchange.
Section 7.4. Reports by Corporation.
The Corporation shall file with the Trustee and with 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 in the Trust Indenture Act; provided that any
such information, documents or reports required to be filed with the Commission
pursuant to Section 13 or Section 15(d) of the Exchange Act shall be filed with
the Trustee within 15 days after the same is required to be filed with the
Commission. Notwithstanding that the Corporation may not be required to remain
subject to the reporting requirements of Section 13 or 15(d) of the Exchange
Act, the Corporation shall continue to file with the Commission and provide the
Trustee with the annual reports and the information, documents and other reports
which are specified in Sections 13 and 15(d) of the Exchange Act. The
Corporation also shall comply with the other provisions of Trust Indenture Act
Section 314(a).
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ARTICLE VIII
Consolidation, Merger, Conveyance, Transfer or Lease
Section 8.1. Corporation May Consolidate, Etc., Only on Certain Terms.
The Corporation 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, and no Person shall consolidate with or merge into the
Corporation or convey, transfer or lease its properties and assets substantially
as an entirety to the Corporation, unless:
(1) if the Corporation shall consolidate with or merge into another Person
or convey, transfer or lease its properties and assets substantially as an
entirety to any Person, the corporation formed by such consolidation or into
which the Corporation is merged or the Person that acquires by conveyance or
transfer, or that leases, the properties and assets of the Corporation
substantially as an entirety shall be a corporation, partnership or trust
organized and existing under the laws of the United States of America or any
State thereof or the District of Columbia 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 of every series and the performance of every covenant of this
Indenture on the part of the Corporation to be performed or observed;
(2) immediately after giving effect to such transaction, no Event of
Default, and no event that, after notice or lapse of time, or both, would
constitute an Event of Default, shall have happened and be continuing; and
(3) the Corporation 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 comply 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
6.1, may rely upon such Officers' Certificate and Opinion of Counsel as
conclusive evidence that such transaction complies with this Section 8.1.
Section 8.2. Successor Corporation Substituted.
Upon any consolidation or merger by the Corporation with or into any other
Person, or any conveyance, transfer or lease by the Corporation of its
properties and assets substantially as an entirety to any Person in accordance
with Section 8.1, the successor corporation formed by such consolidation or into
which the Corporation 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 Corporation under this Indenture with the same effect as if
such successor Person had been named as the Corporation herein; and in the event
of any such conveyance, transfer or lease the Corporation shall be discharged
from all obligations and covenants under the Indenture and the Securities.
Such successor Person may cause to be executed, and may issue either in its
own name or in the name of the Corporation, any or all of the Securities
issuable hereunder that theretofore shall not have been signed by the
Corporation and delivered to the Trustee; and, upon the order of such
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successor Person instead of the Corporation and subject to all the terms,
conditions and limitations in this Indenture prescribed, the Trustee shall
authenticate and shall deliver any Securities that previously shall have been
signed and delivered by the officers of the Corporation to the Trustee for
authentication pursuant to such provisions and any Securities that such
successor Person thereafter shall cause to be executed 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.
In case of any such consolidation, merger, sale, conveyance or lease, such
changes in phraseology and form may be made in the Securities thereafter to be
issued as may be appropriate.
ARTICLE IX
Supplemental Indentures
Section 9.1. Supplemental Indentures without Consent of Holders.
Without the consent of any Holders, the Corporation, 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 Corporation,
and the assumption by any such successor of the covenants of the
Corporation herein and in the Securities contained; or
(2) to convey, transfer, assign, mortgage or pledge any property to or
with the Trustee or to surrender any right or power herein conferred upon
the Corporation; or
(3) to establish the form or terms of Securities of any series as
permitted by Sections 2.1 or 3.1; or
(4) to add to the covenants of the Corporation for the benefit of the
Holders of all or any series of Securities (and if such covenants are to be
for the benefit of less than all series of Securities, stating that such
covenants are expressly being included solely for the benefit of the series
specified) or to surrender any right or power herein conferred upon the
Corporation; or
(5) to add any additional Events of Default for the benefit of the
Holders of all or any series of Securities (and if such additional Events
of Default are to be for the benefit of less than all series of Securities,
stating that such additional Events of Default are expressly being included
solely for the benefit of the series specified); or
(6) to change or eliminate any of the provisions of this Indenture,
provided that any such change or elimination shall (a) become effective
only when there is no Security Outstanding of any series created prior to
the execution of such supplemental indenture that is entitled to the
benefit of such provision or (b) not apply to any Outstanding Securities;
or
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(7) to cure any ambiguity, to correct or supplement any provision
herein that may be defective or inconsistent with any other provision
herein, or to make any other provisions with respect to matters or
questions arising under this Indenture, provided that such action pursuant
to this clause (7) shall not adversely affect the interest of the Holders
of Securities of any series in any material respect or, in the case of the
Securities of a series issued to an Issuer Trust and for so long as any of
the corresponding series of Capital Securities issued by such Issuer Trust
shall remain outstanding, the holders of such Capital Securities; or
(8) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Securities of one or
more series and to add to or change any of the provisions of this Indenture
as shall be necessary to provide for or facilitate the administration of
the trusts hereunder by more than one Trustee, pursuant to the requirements
of Section 6.11(b); or
(9) to comply with the requirements of the Commission in order to
effect or maintain qualification of this Indenture under the Trust
Indenture Act.
Section 9.2. Supplemental Indentures with Consent of Holders.
With the consent of the Holders of not less than a majority in aggregate
principal amount of the Outstanding Securities of each series affected by such
supplemental indenture, by Act of said Holders delivered to the Corporation and
the Trustee, the Corporation, 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 of Securities of such series under this Indenture; provided,
however, that no such supplemental indenture shall, without the consent of the
Holder of each Outstanding Security of each series affected thereby,
(1) change the Stated Maturity of the principal of, or any installment of
interest (including any Additional Interest) on, any Security, or reduce the
principal amount thereof or the rate of interest thereon or any premium payable
upon the redemption thereof, or reduce the amount of principal of a Discount
Security that would be due and payable upon a declaration of acceleration of the
Maturity thereof pursuant to Section 5.2, 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
(2) reduce the percentage in aggregate principal amount of the Outstanding
Securities of any series, 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 5.13 or Section
10.5, 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 Security affected thereby;
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provided, further, that, in the case of the Securities of a series issued to an
Issuer Trust, so long as any of the corresponding series of Capital Securities
issued by such Issuer Trust remains outstanding, (i) no such amendment shall be
made that adversely affects the holders of such 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 Amount (as defined in the related
Trust Agreement) of such Capital Securities then outstanding unless and until
the principal of (and premium, if any, on) the Securities of such series and all
accrued and (subject to Section 3.12) unpaid interest (including any Additional
Interest) thereon have been paid in full, and (ii) no amendment shall be made to
Section 5.8 of this Indenture that would impair the rights of the holders of
Capital Securities issued by any Issuer Trust provided therein without the prior
consent of the holders of each such Capital Security then outstanding unless and
until the principal of (and premium, if any, on) the Securities of such series
and all accrued and (subject to Section 3.12) unpaid interest (including any
Additional Interest) thereon have been paid in full.
A supplemental indenture that changes or eliminates any covenant or other
provision of this Indenture that has expressly been included solely for the
benefit of one or more particular series of Securities or any corresponding
series of Capital Securities of an Issuer Trust that holds the Securities of any
series, or that modifies the rights of the Holders of Securities of such series
or holders of such Capital Securities of such corresponding series with respect
to such covenant or other provision, shall be deemed not to affect the rights
under this Indenture of the Holders of Securities of any other series or holders
of Capital Securities of any other such corresponding series.
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 9.3. Execution of Supplemental Indentures.
In executing or accepting the additional trusts 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 6.1) shall be fully protected in conclusively relying upon,
an Officers' Certificate and an Opinion of Counsel stating that the execution of
such supplemental indenture is authorized or permitted by this Indenture, and
that all conditions precedent herein provided for relating to such action have
been complied with. The Trustee may, but shall not be obligated to, enter into
any such supplemental indenture that affects the Trustee's own rights, duties,
indemnities or immunities under this Indenture or otherwise.
Section 9.4. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article, this
Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
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Section 9.5. Conformity with Trust Indenture Act.
Every supplemental indenture executed pursuant to this Article shall
conform to the requirements of the Trust Indenture Act as then in effect.
Section 9.6. 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 Corporation, bear a notation in form approved by the Corporation as to any
matter provided for in such supplemental indenture. If the Corporation shall so
determine, new Securities of any series so modified as to conform, in the
opinion of the Corporation, to any such supplemental indenture may be prepared
and executed by the Corporation and authenticated and delivered by the Trustee
in exchange for Outstanding Securities of such series.
ARTICLE X
Covenants
Section 10.1. Payment of Principal, Premium and Interest.
The Corporation covenants and agrees for the benefit of each series of
Securities that it will duly and punctually pay the principal of (and premium,
if any) and interest (including any Additional Interest) on the Securities of
that series in accordance with the terms of such Securities and this Indenture.
Section 10.2. Maintenance of Office or Agency.
The Corporation will maintain in each Place of Payment for any series of
Securities an office or agency where Securities of that series may be presented
or surrendered for payment, where Securities of that series may be surrendered
for registration of transfer or exchange and where notices and demands to or
upon the Corporation in respect of the Securities of that series and this
Indenture may be served. The Corporation initially appoints the Trustee, acting
through its Corporate Trust Office, as its agent for said purposes. The
Corporation will give prompt written notice to the Trustee of any change in the
location of any such office or agency. If at any time the Corporation shall fail
to maintain such 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 Corporation
hereby appoints the Trustee as its agent to receive all such presentations,
surrenders, notices and demands.
The Corporation may also from time to time designate one or more other
offices or agencies where the Securities may be presented or surrendered for any
or all of 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 Corporation of its obligation to maintain an office or agency in
each Place of Payment for Securities of any series for such purposes. The
Corporation will give prompt written notice to the Trustee of any such
designation and any change in the location of any such office or agency.
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Section 10.3. Money for Security Payments to be Held in Trust.
If the Corporation shall at any time act as its own Paying Agent with
respect to any series of Securities, it will, on or before each due date of the
principal of (and premium, if any, an) or interest on any of the Securities of
such series, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum sufficient to pay the principal (and premium, if any) 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 failure so to act.
Whenever the Corporation shall have one or more Paying Agents, it will,
prior to 10:00 a.m., New York City time, on each due date of the principal of
(or premium, if any) or interest (including any Additional Interest) on any
Securities, deposit with a Paying Agent a sum sufficient to pay the principal
(and premium, if any) or interest (including any Additional Interest) so
becoming due, such sum to be held in trust for the benefit of the Persons
entitled to such principal (and premium, if any) or interest (including any
Additional Interest), and (unless such Paying Agent is the Trustee) the
Corporation will promptly notify the Trustee of its failure so to act.
The Corporation 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:
(1) hold all sums held by it for the payment of the principal of (and
premium, if any) or interest (including any Additional Interest) on the
Securities of a series in trust for the benefit of the Persons entitled
thereto until such sums shall be paid to such Persons or otherwise disposed
of as herein provided;
(2) give the Trustee written notice of any default by the Corporation
(or any other obligor upon such Securities) in the making of any payment of
principal (and premium, if any) or interest (including any Additional
Interest) in respect of any Security of any Series;
(3) at any time during the continuance of any default with respect to
a series of Securities, upon the written request of the Trustee, forthwith
pay to the Trustee all sums so held in trust by such Paying Agent with
respect to such series; and
(4) comply with the provisions of the Trust Indenture Act applicable
to it as a Paying Agent.
The Corporation may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Corporation Order direct any Paying Agent to pay, to the Trustee all sums
held in trust by the Corporation 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
Corporation 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 Corporation in trust for the payment of the principal of (and premium, if
any) or interest (including any Additional Interest) on any Security and
remaining unclaimed for two years after such principal (and premium, if
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any) or interest has become due and payable shall (unless otherwise required by
mandatory provision of applicable escheat or abandoned or unclaimed property
law) be paid on Corporation Request to the Corporation, or (if then held by the
Corporation) shall (unless otherwise required by mandatory provision of
applicable escheat or abandoned or unclaimed property law) be discharged from
such trust; and the Holder of such Security shall thereafter, as an unsecured
general creditor, look only to the Corporation for payment thereof, and all
liability of the Trustee or such Paying Agent with respect to such trust money,
and all liability of the Corporation as trustee thereof, shall thereupon cease;
provided, however, that the Trustee or such Paying Agent, before being required
to make any such repayment, may at the expense of the Corporation cause to be
published once, in a newspaper published in the English language, customarily
published on each Business Day and of general circulation in the Borough of
Manhattan, The City of New York, notice that such money remains unclaimed and
that, after a date specified therein, which shall not be less than 30 days from
the date of such publication, any unclaimed balance of such money then remaining
will be repaid to the Corporation.
Section 10.4. Statement as to Compliance.
The Corporation shall deliver to the Trustee, within 120 days after the end
of each fiscal year of the Corporation ending after the date hereof, an
Officers' Certificate covering the preceding calendar year, stating whether or
not to the best knowledge of the signers thereof the Corporation is in default
in the performance, observance or fulfillment of or compliance with any of the
terms, provisions, covenants and conditions of this Indenture, and if the
Corporation shall be in default, specifying all such defaults and the nature and
status thereof of which they may have knowledge. For the purpose of this Section
10.4, compliance shall be determined without regard to any grace period or
requirement of notice provided pursuant to the terms of this Indenture.
Section 10.5. Waiver of Certain Covenants.
Subject to the rights of holders of Capital Securities specified in Section
9.2, if any, the Corporation may omit in any particular instance to comply with
any covenant or condition provided pursuant to Section 3.1, 9.1(3) or 9.1(4)
with respect to the Securities of any series, if before or after the time for
such compliance the Holders of at least a majority in aggregate principal amount
of the Outstanding Securities of such series shall, by Act of such Holders,
either waive such compliance in such instance or generally waive compliance with
such covenant or condition, but no such waiver shall extend to or affect such
covenant or condition except to the extent so expressly waived, and, until such
waiver shall become effective, the obligations of the Corporation in respect of
any such covenant or condition shall remain in full force and effect.
Section 10.6. Additional Sums.
In the case of the Securities of a series initially issued to an Issuer
Trust, so long as no Event of Default has occurred and is continuing and except
as otherwise specified as contemplated by Section 2.1 or Section 3.1, if (i) an
Issuer Trust is the Holder of all of the Outstanding Securities of such series,
and (ii) a Tax Event described in clause (i) or (iii) in the definition of Tax
Event in Section 1.1 hereof has occurred and is continuing in respect of such
Issuer Trust, the Corporation shall pay to such Issuer Trust (and its permitted
successors or assigns under the related Trust Agreement) for so long as such
Issuer Trust (or its permitted successor or assignee) is the registered holder
of the
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Outstanding Securities of such series, such additional sums as may be necessary
in order that the amount of Distributions (including any Additional Amounts (as
defined in such Trust Agreement)) then due and payable by such Issuer Trust on
the related Capital Securities and Common Securities that at any time remain
outstanding in accordance with the terms thereof shall not be reduced as a
result of any Additional Taxes arising from such Tax Event (the "Additional
Sums"). Whenever in this Indenture or the Securities there is a reference in any
context to the payment of principal of or interest on the Securities, such
mention shall be deemed to include mention of the payments of the Additional
Sums provided for in this paragraph to the extent that, in such context,
Additional Sums are, were or would be payable in respect thereof pursuant to the
provisions of this paragraph and express mention of the payment of Additional
Sums (if applicable) in any provisions hereof shall not be construed as
excluding Additional Sums in those provisions hereof where such express mention
is not made; provided, however, that the deferral of the payment of interest
pursuant to Section 3.12 or the Securities shall not defer the payment of any
Additional Sums that may be due and payable.
Section 10.7. Additional Covenants.
The Corporation covenants and agrees with each Holder of Securities of each
series that it shall not (x) declare or pay any dividends or distributions on,
or redeem purchase, acquire or make a liquidation payment with respect to, any
shares of the Corporation's capital stock, or (y) make any payment of principal
of or interest or premium, if any, on or repay, repurchase or redeem any debt
securities of the Corporation that rank pari passu in all respects with or
junior in interest to the Securities of such series (other than (a) repurchases,
redemptions or other acquisitions of shares of capital stock of the Corporation
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, in connection with a dividend reinvestment or
stockholder stock purchase plan or in connection with the issuance of capital
stock of the Corporation (or securities convertible into or exercisable for such
capital stock) as consideration in an acquisition transaction entered into prior
to the applicable Extension Period, (b) as a result of an exchange or conversion
of any class or series of the Corporation's capital stock (or any capital stock
of a Subsidiary of the Corporation) for any class or series of the Corporation's
capital stock or of any class or series of the Corporation's indebtedness for
any class or series of the Corporation's capital stock, (c) the purchase of
fractional interests in shares of the Corporation's capital stock pursuant to
the conversion or exchange provisions of such capital stock or the security
being converted or exchanged, (d) any declaration of a dividend in connection
with any Rights Plan, or the issuance of rights, stock or other property under
any Rights Plan, or the redemption or repurchase of rights pursuant thereto, or
(e) any dividend in the form of stock, warrants, options or other rights where
the dividend stock or the stock issuable upon exercise of such warrants, options
or other rights is the same stock as that on which the dividend is being paid or
ranks pari passu with or junior to such stock) if at such time (i) there shall
have occurred any event (A) of which the Corporation has actual knowledge that
with the giving of notice or the lapse of time, or both, would constitute an
Event of Default with respect to the Securities of such series, and (B) which
the Corporation shall not have taken reasonable steps to cure, (ii) if the
Securities of such series are held by an Issuer Trust, the Corporation shall be
in default with respect to its payment of any obligations under the Guarantee
Agreement relating to the Capital Securities issued by such Issuer Trust, or
(iii) the Corporation shall have given notice of its election to begin an
Extension Period with respect to the Securities of such series as provided
herein and shall not have rescinded such notice, or such Extension Period, or
any extension thereof, shall be continuing.
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The Corporation also covenants with each Holder of Securities of a series
issued to an Issuer Trust (i) to hold, directly or indirectly, 100% of the
Common Securities of such Issuer Trust, provided that any permitted successor of
the Corporation hereunder may succeed to the Corporation's ownership of such
Common Securities, (ii) as holder of such Common Securities, not to voluntarily
terminate, wind-up or liquidate such Issuer Trust, other than (a) in connection
with a distribution of the Securities of such series to the holders of the
related Capital Securities in liquidation of such Issuer Trust, or (b) in
connection with certain mergers, consolidations or amalgamations permitted by
the related Trust Agreement, and (iii) to use its reasonable efforts, consistent
with the terms and provisions of such Trust Agreement, to cause such Issuer
Trust to continue not to be taxable as a corporation for United States federal
income tax purposes.
Section 10.8. Original Issue Discount.
For each year during which any Securities that were issued with original
issue discount are Outstanding, the Corporation shall furnish to each Paying
Agent in a timely fashion such information as may be reasonably requested by
each Paying Agent in order that each Paying Agent may prepare the information
which it is required to report for such year on Internal Revenue Service Forms
1096 and 1099 pursuant to Section 6049 of the Internal Revenue Code of 1986, as
amended. Such information shall include the amount of original issue discount
includible in income for each [$25][$1,000] of principal amount at Stated
Maturity of outstanding Securities during such year.
ARTICLE XI
Redemption of Securities
Section 11.1. Applicability of This Article.
Redemption of Securities of any series (whether by operation of a sinking
fund or otherwise) as permitted or required by any form of Security issued
pursuant to this Indenture shall be made in accordance with such form of
Security and this Article; provided, however, that if any provision of any such
form of Security shall conflict with any provision of this Article, the
provision of such form of Security shall govern. Except as otherwise set forth
in the form of Security for such series, each Security of a series shall be
subject to partial redemption only in the amount of [$25] [$1,000] or any
integral multiples thereof.
Section 11.2. Election to Redeem; Notice to Trustee.
The election of the Corporation to redeem any Securities shall be evidenced
by or pursuant to a Board Resolution. In case of any redemption at the election
of the Corporation, the Corporation shall, at least 45 days prior to the
Redemption Date (unless a shorter notice shall be satisfactory to the Trustee),
notify the Trustee in writing and, in the case of Securities of a series held by
an Issuer Trust, the Property Trustee under the related Trust Agreement, of such
date and of the principal amount of Securities of the applicable series to be
redeemed and provide the additional information required to be included in the
notice or notices contemplated by Section 11.4; provided that in the case of any
series of Securities initially issued to an Issuer Trust, for so long as such
Securities are held by such Issuer Trust, such notice shall be given not less
than 45 nor more than 75 days prior to such Redemption Date
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(unless a shorter notice shall be satisfactory to the Property Trustee under the
related Trust Agreement). In the case of any redemption of Securities prior to
the expiration of any restriction on such redemption provided in the terms of
such Securities, the Corporation shall furnish the Trustee with an Officers'
Certificate and an Opinion of Counsel evidencing compliance with such
restriction.
Section 11.3. Selection of Securities to be Redeemed.
If less than all the Securities of any series are to be redeemed, the
particular Securities to be redeemed shall be selected not more than 60 days
prior to the Redemption Date by the Trustee, from the Outstanding Securities of
such series not previously called for redemption, by such method as the Trustee
shall deem fair and appropriate and which may provide for the selection for
redemption of a portion of the principal amount of any Security of such series,
provided that the unredeemed portion of the principal amount of any Security
shall be in an authorized denomination (which shall not be less than the minimum
authorized denomination) for such Security.
The Trustee shall promptly notify the Corporation in writing of the
Securities selected for partial redemption and the principal amount thereof to
be redeemed. 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 Security redeemed or to be redeemed only in part, to the
portion of the principal amount of such Security that has been or is to be
redeemed.
Section 11.4. Notice of Redemption.
Notice of redemption shall be given by first-class mail, postage prepaid,
mailed not later than the thirtieth day, and not earlier than the sixtieth day,
prior to the Redemption Date, to each Holder of Securities to be redeemed, at
the address of such Holder as it appears in the Securities Register, provided
that in the case of any series of Securities initially issued to an Issuer
Trust, for so long as such Securities are held by such Issuer Trust, such notice
shall be given not less than 45 nor more than 75 days prior to such Redemption
Date (unless a shorter notice shall be satisfactory to the Property Trustee
under the related Trust Agreement).
With respect to Securities of each series to be redeemed, each notice of
redemption shall state:
(a) the Redemption Date;
(b) the Redemption Price or, if the Redemption Price cannot be calculated
prior to the time the notice is required to be sent, the estimate of the
Redemption Price together with a statement that it is an estimate and that the
actual Redemption Price will be calculated on the third Business Day prior to
the Redemption Date (and if an estimate is provided, a further notice shall be
sent of the actual Redemption Price on the date that such Redemption Price is
calculated);
(c) if less than all Outstanding Securities of such particular series are
to be redeemed, the identification (and, in the case of partial redemption, the
respective principal amounts) of the particular Securities to be redeemed;
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(d) that on the Redemption Date, the Redemption Price will become due and
payable upon each such Security or portion thereof, and that interest (including
any Additional Interest) thereon, if any, shall cease to accrue on and after
said date;
(e) the place or places where such Securities are to be surrendered for
payment of the Redemption Price;
(f) that the redemption is for a sinking fund, if such is the case;
(g) such other provisions as may be required in respect of the terms of a
particular series of Securities.
Notice of redemption of Securities to be redeemed at the election of the
Corporation shall be given by the Corporation or, at the Corporation's request,
by the Trustee in the name and at the expense of the Corporation and shall be
irrevocable. The notice if mailed in the manner provided above shall be
conclusively presumed to have been duly given, whether or not the Holder
receives such notice. In any case, a failure to give such notice by mail or any
defect in the notice to the Holder of any Security designated for redemption as
a whole or in part shall not affect the validity of the proceedings for the
redemption of any other Security.
Section 11.5. Deposit of Redemption Price.
Prior to 10:00 a.m., New York City time, on the Redemption Date specified
in the notice of redemption given as provided in Section 11.4, the Corporation
will deposit with the Trustee or with one or more Paying Agents (or if the
Corporation is acting as its own Paying Agent, the Corporation will segregate
and hold in trust as provided in Section 10.3) an amount of money sufficient to
pay the Redemption Price of, and any accrued interest (including any Additional
Interest) on, all the Securities (or portions thereof) that are to be redeemed
on that date.
Section 11.6. Payment of Securities Called for Redemption.
If any notice of redemption has been given as provided in Section 11.4, the
Securities or portion of Securities with respect to which such notice has been
given shall become due and payable on the date and at the place or places stated
in such notice at the applicable Redemption Price, together with accrued
interest (including any Additional Interest) to the Redemption Date. On
presentation and surrender of such Securities at a Place of Payment in said
notice specified, the said Securities or the specified portions thereof shall be
paid and redeemed by the Corporation at the applicable Redemption Price,
together with accrued interest (including any Additional Interest) to the
Redemption Date; provided, however, that, unless otherwise specified as
contemplated by Section 3.1, installments of interest (including any Additional
Interest) whose Stated Maturity is on or prior to the Redemption Date will be
payable to the Holders of such Securities, or one or more Predecessor
Securities, registered as such at the close of business on the relevant record
dates according to their terms and the provisions of Section 3.8.
Upon presentation of any Security redeemed in part only, the Corporation
shall execute and the Trustee shall authenticate and deliver to the Holder
thereof, at the expense of the Corporation, a new Security or Securities of the
same series, of authorized denominations, in aggregate principal amount
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equal to the unredeemed portion of the Security so presented and having the same
Original Issue Date, Stated Maturity and terms.
If any Security called for redemption shall not be so paid upon surrender
thereof for redemption, the principal of and premium, if any, on such Security
shall, until paid, bear interest from the Redemption Date at the rate prescribed
therefor in the Security.
Section 11.7. Right of Redemption of Securities Initially Issued to an
Issuer Trust.
In the case of the Securities of a series initially issued to an Issuer
Trust, except as otherwise specified as contemplated by Section 3.1, the
Corporation, at its option, may redeem such Securities (i) on or after the date
specified in such Security, in whole at any time or in part from time to time,
or (ii) upon the occurrence and during the continuation of a Tax Event or an
Investment Company Event, at any time within 90 days following the occurrence
and during the continuation of such Tax Event or Investment Company Event, in
whole (but not in part), in each case at a Redemption Price specified in such
Security, together with accrued interest (including any Additional Interest) to
the Redemption Date.
If less than all the Securities of any such series are to be redeemed, the
aggregate principal amount of such Securities remaining Outstanding after giving
effect to such redemption shall be sufficient to satisfy any provisions of the
Trust Agreement related to the Issuer Trust to which such Securities were
issued, including any requirement in such Trust Agreement as to the minimum
Liquidation Amount (as defined in such Trust Agreement) of Capital Securities
that may be held by a holder of Capital Securities thereunder.
ARTICLE XII
Sinking Funds
Section 12.1. Applicability of Article.
The provisions of this Article shall be applicable to any sinking fund for
the retirement of Securities of any series except as otherwise specified as
contemplated by Section 3.1 for such Securities.
The minimum amount of any sinking fund payment provided for by the terms of
any Securities of any series is herein referred to as a "mandatory sinking fund
payment", and any sinking fund payment in excess of such minimum amount that is
permitted to be made by the terms of such Securities of any series is herein
referred to as an "optional sinking fund payment". If provided for by the terms
of any Securities of any series, the cash amount of any sinking fund payment may
be subject to reduction as provided in Section 12.2. Each sinking fund payment
shall be applied to the redemption of Securities of any series as provided for
by the terms of such Securities.
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Section 12.2. Satisfaction of Sinking Fund Payments with Securities.
In lieu of making all or any part of a mandatory sinking fund payment with
respect to any Securities of a series in cash, the Corporation may at its
option, at any time no more than 16 months and no less than 45 days prior to the
date on which such sinking fund payment is due, deliver to the Trustee
Securities of such series (together with the unmatured coupons, if any,
appertaining thereto) theretofore purchased or otherwise acquired by the
Corporation, except Securities of such series that have been redeemed through
the application of mandatory or optional sinking fund payments pursuant to the
terms of the Securities of such series, accompanied by a Corporation Order
instructing the Trustee to credit such obligations and stating that the
Securities of such series were originally issued by the Corporation by way of
bona fide sale or other negotiation for value; provided that the Securities to
be so credited have not been previously so credited. The Securities to be so
credited shall be received and credited for such purpose by the Trustee at the
redemption price for such Securities, as specified in the Securities so to be
redeemed, for redemption through operation of the sinking fund and the amount of
such sinking fund payment shall be reduced accordingly.
Section 12.3. Redemption of Securities for Sinking Fund.
Not less than 45 days prior to each sinking fund payment date for any
series of Securities, the Corporation will deliver to the Trustee an Officers'
Certificate specifying the amount of the next ensuing sinking fund payment for
such Securities pursuant to the terms of such Securities, the portion thereof,
if any, which is to be satisfied by payment of cash in the currency in which the
Securities of such series are payable (except as provided pursuant to Section
3.1) and the portion thereof, if any, that is to be satisfied by delivering and
crediting Securities pursuant to Section 12.2 and will also deliver to the
Trustee any Securities to be so delivered. Such Officers' Certificate shall be
irrevocable and upon its delivery the Corporation shall be obligated to make the
cash payment or payments therein referred to, if any, on or before the
succeeding sinking fund payment date. In the case of the failure of the
Corporation to deliver such Officers' Certificate (or, as required by this
Indenture, the Securities and coupons, if any, specified in such Officers'
Certificate) by the due date therefor, the sinking fund payment due on the
succeeding sinking fund payment date for such series shall be paid entirely in
cash and shall be sufficient to redeem the principal amount of the Securities of
such series subject to a mandatory sinking fund payment without the right to
deliver or credit securities as provided in Section 12.2 and without the right
to make the optional sinking fund payment with respect to such series at such
time.
Any sinking fund payment or payments (mandatory or optional) made in cash
plus any unused balance of any preceding sinking fund payments made with respect
to the Securities of any particular series shall be applied by the Trustee (or
by the Corporation if the Corporation is acting as its own Paying Agent) on the
sinking fund payment date on which such payment is made (or, if such payment is
made before a sinking fund payment date, on the sinking fund payment date
immediately following the date of such payment) to the redemption of Securities
of such series at the Redemption Price specified in such Securities with respect
to the sinking fund. Any sinking fund moneys not so applied or allocated by the
Trustee (or, if the Corporation is acting as its own Paying Agent, segregated
and held in trust by the Corporation as provided in Section 10.3) for such
series and together with such payment (or such amount so segregated) shall be
applied in accordance with the provisions of this Section 12.3. Any and all
sinking fund moneys with respect to the Securities of any particular series held
by the Trustee (or if the Corporation is acting as its own Paying Agent,
segregated and held in
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trust as provided in Section 10.3) on the last sinking fund payment date with
respect to Securities of such series and not held for the payment or redemption
of particular Securities of such series shall be applied by the Trustee (or by
the Corporation if the Corporation is acting as its own Paying Agent), together
with other moneys, if necessary, to be deposited (or segregated) sufficient for
the purpose, to the payment of the principal of the Securities of such series at
Maturity. The Trustee shall select the Securities to be redeemed upon such
sinking fund payment date in the manner specified in Section 11.3 and cause
notice of the redemption thereof to be given in the name of and at the expense
of the Corporation in the manner provided in Section 11.4. Such notice having
been duly given, the redemption of such Securities shall be made upon the terms
and in the manner stated in Section 11.6. On or before each sinking fund payment
date, the Corporation shall pay to the Trustee (or, if the Corporation is acting
as its own Paying Agent, the Corporation shall segregate and hold in trust as
provided in Section 10.3) in cash a sum in the currency in which Securities of
such series are payable (except as provided pursuant to Section 3.1) equal to
the principal (and premium, if any) and any interest (including any Additional
Interest) accrued to the Redemption Date for Securities or portions thereof to
be redeemed on such sinking fund payment date pursuant to this Section 12.3.
Neither the Trustee nor the Corporation shall redeem any Securities of a
series with sinking fund moneys or mail any notice of redemption of Securities
of such series by operation of the sinking fund for such series during the
continuance of a default in payment of interest, if any, on any Securities of
such series or of any Event of Default (other than an Event of Default occurring
as a consequence of this paragraph) with respect to the Securities of such
series, except that if the notice of redemption shall have been provided in
accordance with the provisions hereof, the Trustee (or the Corporation, if the
Corporation is then acting as its own Paying Agent) shall redeem such Securities
if cash sufficient for that purpose shall be deposited with the Trustee (or
segregated by the Corporation) for that purpose in accordance with the terms of
this Article XII. Except as aforesaid, any moneys in the sinking fund for such
series at the time when any such default or Event of Default shall occur and any
moneys thereafter paid into such sinking fund shall, during the continuance of
such default or Event of Default, be held as security for the payment of the
Securities and coupons, if any, of such series; provided, however, that in case
such default or Event of Default shall have been cured or waived herein, such
moneys shall thereafter be applied on the next sinking fund payment date for the
Securities of such series on which such moneys may be applied pursuant to the
provisions of this Section 12.3.
ARTICLE XIII
Subordination of Securities
Section 13.1. Securities Subordinate to Senior Indebtedness.
The Corporation covenants and agrees, and each Holder of a Security, by its
acceptance thereof, likewise covenants and agrees, that, to the extent and in
the manner hereinafter set forth in this Article, the payment of the principal
of (and premium, if any) and interest (including any Additional Interest) on
each and all of the Securities of each and every series are hereby expressly
made subordinate and subject in right of payment to the prior payment in full of
all Senior Indebtedness.
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Section 13.2. No Payment When Senior Indebtedness in Default; Payment Over
of Proceeds Upon Dissolution, Etc.
If the Corporation shall default in the payment of any principal of (or
premium, if any) or interest on any Senior Indebtedness when the same becomes
due and payable, whether at maturity or at a date fixed for prepayment or by
declaration of acceleration or otherwise, then, upon written notice of such
default to the Corporation by the holders of Senior Indebtedness or any trustee
therefor, unless and until such default shall have been cured or waived or shall
have ceased to exist, no direct or indirect payment (in cash, property,
securities, by set-off or otherwise) shall be made or agreed to be made on
account of the principal of (or premium, if any) or interest (including any
Additional Interest) on any of the Securities, or in respect of any redemption,
repayment, retirement, purchase or other acquisition of any of the Securities.
In the event of (a) any insolvency, bankruptcy, receivership, liquidation,
reorganization, readjustment, composition or other similar proceedings relating
to the Corporation, its creditors or its property, (b) any proceeding for the
liquidation, dissolution or other winding up of the Corporation, voluntary or
involuntary, whether or not involving insolvency or bankruptcy proceedings, (c)
any assignment by the Corporation for the benefit of creditors or (d) any other
marshalling of the assets of the Corporation (each such event, if any, herein
sometimes referred to as a "Proceeding"), all Senior Indebtedness (including any
interest thereon accruing after the commencement of any such proceedings) shall
first be paid in full before any payment or distribution, whether in cash,
securities or other property, shall be made to any Holder of any of the
Securities on account thereof. Any payment or distribution, whether in cash,
securities or other property (other than securities of the Corporation or any
other corporation provided for by a plan of reorganization or readjustment the
payment of which is subordinate, at least to the extent provided in these
subordination provisions with respect to the indebtedness evidenced by the
Securities, to the payment of all Senior Indebtedness at the time outstanding
and to any securities issued in respect thereof under any such plan of
reorganization or readjustment), which would otherwise (but for these
subordination provisions) be payable or deliverable in respect of the Securities
of any series shall be paid or delivered directly to the holders of Senior
Indebtedness in accordance with the priorities then existing among such holders
until all Senior Indebtedness (including any interest thereon accruing after the
commencement of any Proceeding) shall have been paid in full.
In the event of any Proceeding, after payment in full of all sums owing
with respect to Senior Indebtedness, the Holders of the Securities, together
with the holders of any obligations of the Corporation ranking on a parity with
the Securities, shall be entitled to be paid from the remaining assets of the
Corporation the amounts at the time due and owing on account of unpaid principal
of (and premium, if any) and interest on the Securities and such other
obligations before any payment or other distribution, whether in cash, property
or otherwise, shall be made on account of any capital stock or any obligations
of the Corporation ranking junior to the Securities and such other obligations.
If, notwithstanding the foregoing, any payment or distribution of any character
or any security, whether in cash, securities or other property (other than
securities of the Corporation or any other corporation provided for by a plan of
reorganization or readjustment the payment of which is subordinate, at least to
the extent provided in these subordination provisions with respect to the
indebtedness evidenced by the Securities, to the payment of all Senior
Indebtedness at the time outstanding and to any securities issued in respect
thereof under any such plan of reorganization or readjustment), shall be
received by the Trustee or any Holder in contravention of any of the terms
hereof and before all Senior
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Indebtedness shall have been paid in full, such payment or distribution or
security shall be received in trust for the benefit of, and shall be paid over
or delivered and transferred to, the holders of the Senior Indebtedness at the
time outstanding in accordance with the priorities then existing among such
holders for application to the payment of all Senior Indebtedness remaining
unpaid, to the extent necessary to pay all such Senior Indebtedness in full. In
the event of the failure of the Trustee or any Holder to endorse or assign any
such payment, distribution or security, each holder of Senior Indebtedness is
hereby irrevocably authorized to endorse or assign the same.
The Trustee and the Holders shall take such action (including, without
limitation, the delivery of this Indenture to an agent for the holders of Senior
Indebtedness or consent to the filing of a financing statement with respect
hereto) as may, in the opinion of counsel designated by the holders of a
majority in principal amount of the Senior Indebtedness at the time outstanding,
be necessary or appropriate to assure the effectiveness of the subordination
effected by these provisions.
The provisions of this Section 13.2 shall not impair any rights, interests,
remedies or powers of any secured creditor of the Corporation in respect of any
security interest the creation of which is not prohibited by the provisions of
this Indenture.
The securing of any obligations of the Corporation, otherwise ranking on a
parity with the Securities or ranking junior to the Securities, shall not be
deemed to prevent such obligations from constituting, respectively, obligations
ranking on a parity with the Securities or ranking junior to the Securities.
Section 13.3. Payment Permitted If No Default.
Nothing contained in this Article or elsewhere in this Indenture or in any
of the Securities shall prevent (a) the Corporation, at any time, except during
the pendency of the conditions described in the first paragraph of Section 13.2
or of any Proceeding referred to in Section 13.2, from making payments at any
time of principal of (and premium, if any) or interest (including any Additional
Interest) on the Securities, or (b) the application by the Trustee of any moneys
deposited with it hereunder to the payment of or on account of the principal of
(and premium, if any) or interest (including any Additional Interest) on the
Securities or the retention of such payment by the Holders, if, at the time of
such application by the Trustee, it did not have knowledge that such payment
would have been prohibited by the provisions of this Article.
Section 13.4. Subrogation to Rights of Holders of Senior Indebtedness.
Subject to the payment in full of all amounts due or to become due on all
Senior Indebtedness, or the provision for such payment in cash or cash
equivalents or otherwise in a manner satisfactory to the holders of Senior
Indebtedness, the Holders of the Securities shall be subrogated to the extent of
the payments or distributions made to the holders of such Senior Indebtedness
pursuant to the provisions of this Article (equally and ratably with the holders
of all indebtedness of the Corporation that by its express terms is subordinated
to Senior Indebtedness of the Corporation to substantially the same extent as
the Securities are subordinated to the Senior Indebtedness and is entitled to
like rights of subrogation by reason of any payments or distributions made to
holders of such Senior Indebtedness) to the rights of the holders of such Senior
Indebtedness to receive payments and distributions of cash, property and
securities applicable to the Senior Indebtedness until the principal of (and
premium, if any) and interest
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<PAGE>
(including any Additional Interest) on the Securities shall be paid in full. For
purposes of such subrogation, no payments or distributions to the holders of the
Senior Indebtedness of any cash, property or securities to which the Holders of
the Securities or the Trustee would be entitled except for the provisions of
this Article, and no payments over pursuant to the provisions of this Article to
the holders of Senior Indebtedness by Holders of the Securities or the Trustee,
shall, as among the Corporation, its creditors other than holders of Senior
Indebtedness, and the Holders of the Securities, be deemed to be a payment or
distribution by the Corporation to or on account of the Senior Indebtedness.
Section 13.5. Provisions Solely to Define Relative Rights.
The provisions of this Article are and are intended solely for the purpose
of defining the relative rights of the Holders of the Securities on the one hand
and the holders of Senior Indebtedness on the other hand. Nothing contained in
this Article or elsewhere in this Indenture or in the Securities is intended to
or shall (a) impair, as between the Corporation and the Holders of the
Securities, the obligations of the Corporation, which are absolute and
unconditional, to pay to the Holders of the Securities the principal of (and
premium, if any) and interest (including any Additional Interest) on the
Securities as and when the same shall become due and payable in accordance with
their terms; or (b) affect the relative rights against the Corporation of the
Holders of the Securities and creditors of the Corporation other than their
rights in relation to the holders of Senior Indebtedness; or (c) prevent the
Trustee or the Holder of any Security (or to the extent expressly provided
herein, the holder of any Capital Security) from exercising all remedies
otherwise permitted by applicable law upon default under this Indenture,
including filing and voting claims in any Proceeding, subject to the rights, if
any, under this Article of the holders of Senior Indebtedness to receive cash,
property and securities otherwise payable or deliverable to the Trustee or such
Holder.
Section 13.6. Trustee to Effectuate Subordination.
Each Holder of a Security by his or her acceptance thereof authorizes and
directs the Trustee on his or her behalf to take such action as may be necessary
or appropriate to acknowledge or effectuate the subordination provided in this
Article and appoints the Trustee his or her attorney-in-fact for any and all
such purposes.
Section 13.7. No Waiver of Subordination Provisions.
No right of any present or future holder of any Senior 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
Corporation or by any act or failure to act, in good faith, by any such holder,
or by any noncompliance by the Corporation with the terms, provisions and
covenants of this Indenture, regardless of any knowledge thereof that any such
holder may have or be otherwise charged with.
Without in any way limiting the generality of the immediately preceding
paragraph, the holders of Senior Indebtedness may, at any time and from to time,
without the consent of or notice to the Trustee or the Holders of the Securities
of any series, without incurring responsibility to such Holders of the
Securities and without impairing or releasing the subordination provided in this
Article or the obligations hereunder of such Holders of the Securities to the
holders of Senior Indebtedness, do any one or more of the following: (i) change
the manner, place or terms of payment or extend the time of
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<PAGE>
payment of, or renew or alter, Senior Indebtedness, or otherwise amend or
supplement in any manner Senior Indebtedness or any instrument evidencing the
same or any agreement under which Senior Indebtedness is outstanding; (ii) sell,
exchange, release or otherwise deal with any property pledged, mortgaged or
otherwise securing Senior Indebtedness; (iii) release any Person liable in any
manner for the collection of Senior Indebtedness; and (iv) exercise or refrain
from exercising any rights against the Corporation and any other Person.
Section 13.8. Notice to Trustee.
The Corporation shall give prompt written notice to a Responsible Officer
of the Trustee of any fact known to the Corporation that would prohibit the
making of any payment to or by the Trustee in respect of the Securities.
Notwithstanding the provisions of this Article 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 to or by the Trustee in
respect of the Securities, unless and until a Responsible Officer of the Trustee
shall have received written notice thereof from the Corporation or a holder of
Senior Indebtedness or from any trustee, agent or representative therefor;
provided, however, that if the Trustee shall not have received the notice
provided for in this Section at least two Business Days prior to the date upon
which by the terms hereof any monies may become payable for any purpose
(including, the payment of the principal of (and premium, if any, on) or
interest (including any Additional Interest) on any Security), then, anything
herein contained to the contrary notwithstanding, the Trustee shall have full
power and authority to receive such monies and to apply the same to the purpose
for which they were received and shall not be affected by any notice to the
contrary that may be received by it within two Business Days prior to such date.
Subject to the provisions of Section 6.1, the Trustee shall be entitled to
rely on the delivery to it of a written notice by a Person representing himself
or herself to be a holder of Senior Indebtedness (or a trustee or attorney-in-
fact therefor) to establish that such notice has been given by a holder of
Senior Indebtedness (or a trustee or attorney-in-fact therefor). 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 Senior Indebtedness to
participate in any payment or distribution pursuant to this Article, the Trustee
may request such Person to furnish evidence to the reasonable satisfaction of
the Trustee as to the amount of Senior Indebtedness held by such Person, the
extent to which such Person is entitled to participate in such payment or
distribution and any other facts pertinent to the rights of such Person under
this Article, 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 13.9. Reliance on Judicial Order or Certificate of Liquidating
Agent.
Upon any payment or distribution of assets of the Corporation referred to
in this Article, the Trustee, subject to the provisions of Section 6.1, and the
Holders of the Securities shall be entitled to conclusively rely upon any order
or decree entered by any court of competent jurisdiction in which such
Proceeding is pending, or a certificate of the trustee in bankruptcy, receiver,
liquidating trustee, custodian, assignee for the benefit of creditors, agent or
other Person making such payment or distribution, delivered to the Trustee or to
the Holders of Securities, for the purpose of ascertaining the Persons entitled
to participate in such payment or distribution, the holders of the Senior
Indebtedness and other indebtedness of the Corporation, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article.
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<PAGE>
Section 13.10. Trustee Not Fiduciary for Holders of Senior Indebtedness.
The Trustee, in its capacity as trustee under this Indenture, shall not be
deemed to owe any fiduciary duty to the holders of Senior Indebtedness and shall
not be liable to any such holders if it shall in good faith mistakenly pay over
or distribute to Holders of Securities or to the Corporation or to any other
Person cash, property or securities to which any holders of Senior Indebtedness
shall be entitled by virtue of this Article or otherwise.
Section 13.11. Rights of Trustee as Holder of Senior Indebtedness;
Preservation of Trustee's Rights.
The Trustee in its individual capacity shall be entitled to all the rights
set forth in this Article with respect to any Senior Indebtedness that may at
any time be held by it, to the same extent as any other holder of Senior
Indebtedness, and nothing in this Indenture shall deprive the Trustee of any of
its rights as such holder.
Section 13.12. Article Applicable to Paying Agents.
If at any time any Paying Agent other than the Trustee shall have been
appointed by the Corporation and be then acting hereunder, the term "Trustee" as
used in this Article shall in such case (unless the context otherwise requires)
be construed as extending to and including such Paying Agent within its meaning
as fully for all intents and purposes as if such Paying Agent were named in this
Article in addition to or in place of the Trustee.
* * * *
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<PAGE>
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.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
American Express Company
By:
-----------------------------------
Name:
Title:
Attest:
-------------------------
Bankers Trust Company,
as Trustee and not in its individual
capacity
By:
-----------------------------------
Name:
Title:
Attest:
-------------------------
<PAGE>
EXHIBIT 4.2
CERTIFICATE OF TRUST OF
AMERICAN EXPRESS COMPANY CAPITAL TRUST I
THIS Certificate of Trust of American Express Company Capital Trust I
(the "Trust"), dated of May 29, 1998, is being duly executed and filed on
behalf of the Trust by the undersigned, as trustee, to form a business trust
under the Delaware Business Trust Act (12 Del.C. (S) 3801 et seq.) (the "Act").
------ -- ---
1. Name. The name of the business trust formed by this Certificate of
----
Trust is American Express Company Capital Trust I.
2. Delaware Trustee. The name and business address of the trustee of the
----------------
Trust in the State of Delaware are Bankers Trust (Delaware), E. A. Delle Donne
Corporate Center, Montgomery Building, 1011 Centre Road, Suite 200, Wilmington,
Delaware 19805-1266.
3. Effective Date. This Certificate of Trust shall be effective upon its
filing.
IN WITNESS WHEREOF, the undersigned has duly executed this Certificate
of Trust in accordance with Section 381 1(a)(1) of the Act.
BANKERS TRUST (DELAWARE), not in its
individual capacity but solely as
trustee
By: /s/ M. Lisa Wilkins
--------------------------------
Name: M. LISA WILKINS
Title: ASSISTANT SECRETARY
<PAGE>
EXHIBIT 4.3
TRUST AGREEMENT
OF
AMERICAN EXPRESS COMPANY CAPITAL TRUST I
THIS TRUST AGREEMENT is made as of May 29, 1998 (this "Trust
Agreement"), by and among American Express Company, a New York corporation, as
depositor (the "Depositor"), and Bankers Trust (Delaware), as trustee (the
"Trustee"). The Depositor and the Trustee hereby agree as follows:
1. The trust created hereby shall be known as American Express
Company Capital Trust I (the "Trust"), in which name the Trustee or the
Depositor, to the extent provided herein, may conduct the business of the Trust,
make and execute contracts, and sue and be sued.
2. The Depositor hereby assigns, transfers, conveys and sets over
the Trust the sum of $10. It is the intention of the parties hereto that the
Trust created hereby constitute a business trust under Chapter 38 of Title 12 of
the Delaware Code, 12 Del.C. ss 3801, et seq. (the "Business Trust Act"), and
that this document constitute the governing instrument of the Trust. The Trustee
is hereby authorized and directed to execute and file a certificate of trust
with the Delaware Secretary of State in accordance with the provisions of the
Business Trust Act.
3. The Depositor and the Trustee will enter into an amended and
restated Trust Agreement satisfactory to each such party and substantially in
the form included as an exhibit to the 1933 Act Registration Statement (as
defined below), to provide for the contemplated operation of the Trust created
hereby and the issuance of the Capital Securities and Common Securities referred
to therein. Prior to the execution and delivery of such amended and restated
Trust Agreement, the Trustee shall not have any duty or obligation hereunder or
with respect of the trust estate, except as otherwise required by applicable law
or as may be necessary to obtain prior to such execution and delivery any
licenses, consents or approvals required by applicable law or otherwise.
Notwithstanding the foregoing, the Trustee may take all actions deemed proper as
are necessary to effect the transactions contemplated herein.
4. The Depositor, as sponsor of the Trust, is hereby authorized, in
its discretion, (i) to file with the Securities and Exchange Commission (the
"Commission") and to execute, in the case of the 1933 Act Registration Statement
and 1934 Act Registration Statement (as herein defined), on behalf of the Trust,
(a) a Registration Statement (the "1933 Act Registration Statement"), including
all pre-effective and post-effective amendments thereto, relating to the
registration under the Securities Act of 1933, as amended (the "1933 Act"), of
the Capital Securities of the Trust, (b) any preliminary prospectus or
prospectus or supplement thereto relating to the Capital Securities of the Trust
required to be filed pursuant to the 1933 Act, and (c) a Registration Statement
on Form 8-A or other appropriate form (the "1934 Act Registration
<PAGE>
Statement"), including all pre-effective and post-effective amendments thereto,
relating to the registration of the Capital Securities of the Trust under the
Securities Exchange Act of 1934, as amended; (ii) to file with the New York
Stock Exchange or other exchange, or the National Association of Securities
Dealers ("NASD"), and execute on behalf of the Trust a listing application and
all other applications, statements, certificates, agreements and other
instruments as shall be necessary or desirable to cause the Capital Securities
of the Trust to be listed on the New York Stock Exchange or such other exchange,
or the NASD's Nasdaq National Market; (iii) to file and execute on behalf of the
Trust, such applications, reports, surety bonds, irrevocable consents,
appointments of attorney for service of process and other papers and documents
that shall be necessary or desirable to register the Capital Securities of the
Trust under the securities or "Blue Sky" laws of such jurisdictions as the
Depositor, on behalf of the Trust, may deem necessary or desirable; (iv) to
execute and deliver letters or documents to, or instruments for filing with, a
depository relating to the Capital Securities of the Trust; and (v) to execute,
deliver and perform on behalf of the Trust an underwriting agreement with one or
more underwriters relating to the offering of the Capital Securities of the
Trust.
In the event that any filing referred to in this Section 4 is
required by the rules and regulations of the Commission, the New York Stock
Exchange or other exchange, NASD, or state securities or "Blue Sky" laws to be
executed on behalf of the Trust by the Trustee, the Trustee, in its capacity as
trustee of the Trust, is hereby authorized to join in any such filing and to
execute on behalf of the Trust any and all of the foregoing, it being understood
that the Trustee, in its capacity as trustee of the Trust, shall not be required
to join in any such filing or execute on behalf of the Trust any such document
unless required by the rules and regulations of the Commission, the New York
Stock Exchange or other exchange, NASD, or state securities or "Blue Sky" laws.
5. This Trust Agreement may be executed in one or more counterparts.
6. The number of trustees of the Trust initially shall be one and
thereafter the number of trustees of the Trust shall be such number as shall
be fixed from time to time by a written instrument signed by the Depositor which
may increase or decrease the number of trustees of the Trust; provided, however,
that to the extent required by the Business Trust Act, one trustee of the Trust
shall either be a natural person who is a resident of the State of Delaware or,
if not a natural person, an entity which has its principal place of business in
the State of Delaware. Subject to the foregoing, the Depositor is entitled to
appoint or remove without cause any trustee of the Trust at any time. Any
trustee of the Trust may resign upon thirty days' prior notice to the Depositor.
7. This Trust Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware (without regard to conflict
of laws principles).
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Trust Agreement
to be duly executed as of the day and year first above written.
AMERICAN EXPRESS COMPANY,
as Depositor
By: /s/ Kim Rosenberg
------------------------------
Name: Kim Rosenberg
Title: Senior Vice President
and Treasurer
BANKERS TRUST (DELAWARE), not in its
individual capacity but solely as
trustee of the Trust
By: /s/ M. Lisa Wilkins
------------------------------
Name: M. Lisa Wilkins
Title: Assistant Secretary
<PAGE>
EXHIBIT 4.4
CERTIFICATE OF TRUST OF
AMERICAN EXPRESS COMPANY CAPITAL TRUST II
THIS Certificate of Trust of American Express Company Capital Trust I
(the "Trust"), dated of May 29, 1998, is being duly executed and filed on
behalf of the Trust by the undersigned, as trustee, to form a business trust
under the Delaware Business Trust Act (12 Del.C. (S) 3801 et seq.) (the "Act").
------ -- ---
1. Name. The name of the business trust formed by this Certificate of
----
Trust is American Express Company Capital Trust II.
2. Delaware Trustee. The name and business address of the trustee of the
----------------
Trust in the State of Delaware are Bankers Trust (Delaware), E. A. Delle Donne
Corporate Center, Montgomery Building, 1011 Centre Road, Suite 200, Wilmington,
Delaware 19805-1266.
3. Effective Date. This Certificate of Trust shall be effective upon its
--------------
filing.
IN WITNESS WHEREOF, the undersigned has duly executed this Certificate
of Trust in accordance with Section 3811(a)(1) of the Act.
BANKERS TRUST (DELAWARE), not in its
individual capacity but solely as
trustee
By: /s/ M. Lisa Wilkins
--------------------------------
Name: M. LISA WILKINS
Title: ASSISTANT SECRETARY
<PAGE>
EXHIBIT 4.5
TRUST AGREEMENT
OF
AMERICAN EXPRESS COMPANY CAPITAL TRUST II
THIS TRUST AGREEMENT is made as of May 29, 1998 (this "Trust Agreement")
by and among American Express Company, a New York corporation, as depositor (the
"Depositor"), and Bankers Trust (Delaware), as trustee (the "Trustee"). The
Depositor and the Trustee hereby agree as follows:
1. The trust created hereby shall be known as American Express Company
Capital Trust II (the "Trust"), in which name the Trustee or the Depositor, to
the extent provided herein, may conduct the business of the Trust, make and
execute contracts, and sue and be sued.
2. The Depositor hereby assigns, transfers, conveys and sets over to the
Trust the sum of $10. It is the intention of the parties hereto that the Trust
created hereby constitute a business trust under Chapter 38 of Title 12 of the
Delaware Code, 21 Del. C. (S) 3801, et seq. (the "Business Trust Act"), and
------- ------
that this document constitute the governing instrument of the Trust. The Trustee
is hereby authorized and directed to execute and file a certificate of trust
with the Delaware Secretary of State in accordance with the provisions of the
Business Trust Act.
3. The Depositor and the Trustee will enter into an amended and restated
Trust Agreement satisfactory to each such party and substantially in the form
included as an exhibit to the 1933 Act Registration Statement (as defined
below), to provide for the contemplated operation of the Trust created hereby
and the issuance of the Capital Securities and Common Securities referred to
therein. Prior to the execution and delivery of such amended and restated Trust
Agreement, the Trustee shall not have any duty or obligation hereunder or with
respect of the trust estate, except as otherwise required by applicable law or
as may be necessary to obtain prior to such execution and delivery any licenses,
consents or approvals required by applicable law or otherwise. Notwithstanding
the foregoing, the Trustee may take all actions deemed proper as are necessary
to effect the transactions contemplated herein.
4. The Depositor, as sponsor of the Trust, is hereby authorized, in its
discretion, (i) to file with the Securities and Exchange Commission (the
"Commission") and to execute, in the case of the 1933 Act Registration Statement
and 1934 Act Registration Statement (as herein defined), on behalf of the Trust,
(a) a Registration Statement (the "1933 Act Registration Statement"), including
all pre-effective and post-effective amendments thereto, relating to the
registration under the Securities Act of 1933, as amended (the "1933 Act"), of
the Capital Securities of the Trust, (b) any preliminary prospectus or
prospectus or supplement thereto relating to the Capital Securities of the Trust
required to be filed pursuant to the 1933 Act, and (c) a Registration Statement
on Form 8-A or other appropriate form (the "1934 Act Registration
<PAGE>
Statement"), including all pre-effective and post-effective amendments thereto,
relating to the registration of the Capital Securities of the Trust under the
Securities Exchange Act of 1934, as amended, (ii) to file with the New York
Stock Exchange or other exchange, or the National Association of Securities
Dealers ("NASD"), and execute on behalf of the Trust a listing application and
all other applications, statements, certificates, agreements and other
instruments as shall be necessary or desirable to cause the Capital Securities
of the Trust be listed on the New York Stock Exchange or such other exchange, or
the NASD's Nasdaq National Market; (iii) to file and execute on behalf of the
Trust, such applications, reports, surety bonds, irrevocable consents,
appointments of attorney for service of process and other papers and
documents that shall be necessary or desirable to register the Capital
Securities of the Trust under the securities or "Blue Sky" laws of such
jurisdictions as the Depositor, on behalf of the Trust, may deem necessary or
desirable; (iv) to execute and deliver letters or documents to, or instruments
for filing with, a depository relating to the Capital Securities of the Trust;
and (v) to execute, deliver and perform on behalf of the Trust an underwriting
agreement with one or more underwriters relating to the offering of the Capital
Securities of the Trust.
In the event that any filing referred to in this Section 4 is required
by the rules and regulations of the Commission, the New York Stock Exchange or
other exchange, NASD, or state securities or "Blue Sky" laws to be executed on
behalf of the Trust by the Trustee, the Trustee, in its capacity as trustee of
the Trust, is hereby authorized to join in any such filing and to execute on
behalf of the Trust any and all of the foregoing, it being understood that the
Trustee, in its capacity as trustee of the Trust, shall not be required to join
in any such filing or execute on behalf of the Trust any such document unless
required by the rules and regulations of the Commission, the New York Stock
Exchange or other exchange, NASD, or state securities or "Blue Sky" laws.
5. This Trust Agreement may be executed in one or more counterparts.
6. The number of trustees of the Trust initially shall be one and
thereafter the number of trustees of the Trust shall be such number as shall be
fixed from time to time by a written instrument signed by the Depositor which
may increase or decrease the number of one trustee of the Trust shall either be
a natural person who is a resident of the State of Delaware or, if not a natural
person, an entity which has its principal place of business in the State of
Delaware. Subject to the foregoing, the Depositor is entitled to appoint or
remove without cause any trustee of the Trust at any time. Any trustee of the
Trust may resign upon thirty days' prior notice to the Depositor.
7. This Trust Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware (without regard to conflict
of laws principles).
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Trust Agreement
to be duly executed as of the day and year first above written.
AMERICAN EXPRESS COMPANY,
as Depositor
By: /s/ Kim Rosenberg
-----------------------------
Name: Kim Rosenberg
Title: Senior Vice President
and Treasurer
BANKERS TRUST (DELAWARE), not in its
individual capacity but solely as trustee of the Trust
By: /s/ M. Lisa Wilkins
-----------------------------
Name: M. LISA WILKINS
Title: ASSISTANT SECRETARY
3
<PAGE>
Exhibit 4.6
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
AMENDED AND RESTATED TRUST AGREEMENT
among
AMERICAN EXPRESS COMPANY,
as Depositor
BANKERS TRUST COMPANY,
as Property Trustee
BANKERS TRUST (DELAWARE),
as Delaware Trustee
and the several Holders of the Trust Securities
-------------------------
Dated as of ____ __, 199_
-------------------------
AMERICAN EXPRESS COMPANY CAPITAL TRUST _
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
ARTICLE I. Defined Terms 1
Section 1.1. Definitions.................................................. 1
ARTICLE II. Continuation of the Issuer Trust 12
Section 2.1. Name......................................................... 12
Section 2.2. Office of the Delaware Trustee; Principal Place of Business.. 12
Section 2.3. Initial Contribution of Trust Property; Organizational
Expenses........................................................... 13
Section 2.4. Issuance of the Capital Securities........................... 13
Section 2.5. Issuance of the Common Securities; Subscription and Purchase
of Debentures...................................................... 13
Section 2.6. Continuation of Trust........................................ 13
Section 2.7. Authorization to Enter into Certain Transactions............. 14
Section 2.8. Assets of Trust.............................................. 18
Section 2.9. Title to Trust Property...................................... 18
ARTICLE III. Payment Account 18
Section 3.1. Payment Account.............................................. 18
ARTICLE IV. Distributions; Redemption 19
Section 4.1. Distributions................................................ 19
Section 4.2. Redemption................................................... 20
Section 4.3. Subordination of Common Securities........................... 22
Section 4.4. Payment Procedures........................................... 23
Section 4.5. Withholding Tax.............................................. 23
Section 4.6. Tax Returns and Reports...................................... 23
Section 4.7. Payment of Taxes, Duties, Etc. of the Issuer Trust........... 24
Section 4.8. Payments under Indenture or Pursuant to Direct Actions....... 24
Section 4.9. Liability of the Holder of Common Securities................. 24
ARTICLE V. Securities Certificates 24
Section 5.1. Initial Ownership............................................ 24
Section 5.2. The Securities Certificates.................................. 25
Section 5.3. Execution and Delivery of Securities Certificates............ 25
Section 5.4. Book-Entry Capital Securities................................ 25
Section 5.5. Registration of Transfer and Exchange of Capital Securities
Certificates....................................................... 27
Section 5.6. Mutilated, Destroyed, Lost or Stolen Securities Certificates. 29
Section 5.7. Persons Deemed Holders....................................... 29
Section 5.8. Access to List of Holders' Names and Addresses............... 30
Section 5.9. Maintenance of Office or Agency.............................. 30
Section 5.10. Appointment of Paying Agents................................. 30
Section 5.11. Ownership of Common Securities by Depositor.................. 31
Section 5.12. Notices to Clearing Agency................................... 31
Section 5.13. Rights of Holders; Waivers of Past Defaults.................. 31
ARTICLE VI. Acts of Holders; Meetings; Voting 34
Section 6.1. Limitations on Voting Rights................................. 34
Section 6.2. Notice of Meetings........................................... 35
i
<PAGE>
Section 6.3. Meetings of Holders of the Capital Securities................ 35
Section 6.4. Voting Rights................................................ 35
Section 6.5. Proxies, etc................................................. 35
Section 6.6. Holder Action by Written Consent............................. 36
Section 6.7. Record Date for Voting and Other Purposes.................... 36
Section 6.8. Acts of Holders.............................................. 36
Section 6.9. Inspection of Records........................................ 37
ARTICLE VII. Representations and Warranties 38
Section 7.1. Representations and Warranties of the Property Trustee and
the Delaware Trustee............................................... 38
Section 7.2. Representations and Warranties of Depositor.................. 39
ARTICLE VIII. The Issuer Trustees; The Administrators 40
Section 8.1. Certain Duties and Responsibilities.......................... 40
Section 8.2. Certain Notices.............................................. 42
Section 8.3. Certain Rights of Property Trustee........................... 43
Section 8.4. Not Responsible for Recitals or Issuance of Securities....... 45
Section 8.5. May Hold Securities.......................................... 45
Section 8.6. Compensation; Indemnity; Fees................................ 45
Section 8.7. Corporate Property Trustee Required; Eligibility of Issuer
Trustees and Administrators........................................ 47
Section 8.8. Conflicting Interests........................................ 47
Section 8.9. Co-Trustees and Separate Trustee............................. 48
Section 8.10. Resignation and Removal; Appointment of Successor............ 49
Section 8.11. Acceptance of Appointment by Successor....................... 50
Section 8.12. Merger, Conversion, Consolidation or Succession to Business.. 51
Section 8.13. Preferential Collection of Claims Against Depositor or Issuer
Trust.............................................................. 51
Section 8.14. Property Trustee May File Proofs of Claim.................... 51
Section 8.15. Reports by Property Trustee.................................. 52
Section 8.16. Reports to the Property Trustee.............................. 53
Section 8.17. Evidence of Compliance with Conditions Precedent............. 53
Section 8.18. Number of Issuer Trustees.................................... 53
Section 8.19. Delegation of Power.......................................... 54
Section 8.20. Appointment of Administrators................................ 54
ARTICLE IX. Termination, Liquidation and Merger 55
Section 9.1. Termination Upon Expiration Date............................. 55
Section 9.2. Early Termination............................................ 55
Section 9.3. Termination.................................................. 55
Section 9.4. Liquidation.................................................. 56
Section 9.5. Mergers, Consolidations, Amalgamations or Replacements of
Issuer Trust....................................................... 57
ARTICLE X. Miscellaneous Provisions 58
Section 10.1. Limitation of Rights of Holders.............................. 58
ii
<PAGE>
Section 10.2. Agreed Tax Treatment of Issuer Trust and Trust Securities... 58
Section 10.3. Amendment................................................... 59
Section 10.4. Separability................................................ 60
Section 10.5. Governing Law............................................... 60
Section 10.6. Payments Due on Non-Business Day............................ 61
Section 10.7. Successors.................................................. 61
Section 10.8. Headings.................................................... 61
Section 10.9. Reports, Notices and Demands................................ 61
Section 10.10. Agreement Not to Petition................................... 62
Section 10.11. Trust Indenture Act; Conflict with Trust Indenture Act...... 62
Section 10.12. Acceptance of Terms of Trust Agreement, Guarantee Agreement
and Indenture........................................................ 63
iii
<PAGE>
Exhibit A Certificate of Trust
Exhibit B Form of Letter of Representations
Exhibit C Form of Common Securities Certificate
Exhibit D Form of Expense Agreement
Exhibit E Form of Capital Securities Certificate
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AMENDED AND RESTATED TRUST AGREEMENT, dated as of __ __, 199_, among (i)
American Express Company, a New York corporation (including any successors or
assigns, the "Depositor"), (ii) Bankers Trust Company, a New York banking
corporation, as property trustee (in such capacity, the "Property Trustee" and,
in its separate corporate capacity and not in its capacity as Property Trustee,
the "Bank"), (iii) Bankers Trust (Delaware), a Delaware banking corporation, as
Delaware trustee (in such capacity, the "Delaware Trustee") (the Property
Trustee and the Delaware Trustee being referred to collectively as the "Issuer
Trustees"), and (iv) the several Holders, as hereinafter defined.
Witnesseth
Whereas, the Depositor and the Delaware Trustee have heretofore duly
declared and established a business trust pursuant to the Delaware Business
Trust Act by entering into a Trust Agreement, dated as of __ __, 199_ (the
"Original Trust Agreement"), and by the execution and filing by the Delaware
Trustee with the Secretary of State of the State of Delaware of the Certificate
of Trust, filed on __ __, 199_, attached as Exhibit A; and
Whereas, the Depositor and the Issuer Trustees desire to amend and restate
the Original Trust Agreement in its entirety as set forth herein to provide for,
among other things, (i) the issuance of the Common Securities by the Issuer
Trust to the Depositor, (ii) the issuance and sale of the Capital Securities by
the Issuer Trust pursuant to the Underwriting Agreement, (iii) the acquisition
by the Issuer Trust from the Depositor of all of the right, title and interest
in the Debentures, and (iv) the appointment of the Administrators;
Now Therefore, in consideration of the agreements and obligations set forth
herein and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, each party, for the benefit of the
other parties and for the benefit of the Holders, hereby amends and restates the
Original Trust Agreement in its entirety and agrees as follows:
ARTICLE I.
Defined Terms
Section 1.1. Definitions.
For all purposes of this Trust Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
(a) The terms defined in this Article have the meanings assigned to
them in this Article, and include the plural as well as the singular;
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(b) All other terms used herein that are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(c) The words "include", "includes" and "including" shall be deemed
to be followed by the phrase "without limitation";
(d) All accounting terms used but not defined herein have the
meanings assigned to them in accordance with United States generally
accepted accounting principles;
(e) Unless the context otherwise requires, any reference to an
"Article", a "Section" or an "Exhibit" refers to an Article, a Section or
an Exhibit, as the case may be, of or to this Trust Agreement; and
(f) The words "hereby", "herein", "hereof" and "hereunder" and
other words of similar import refer to this Trust Agreement as a whole and
not to any particular Article, Section or other subdivision.
"Act" has the meaning specified in Section 6.8.
"Additional Amount" means, with respect to Trust Securities of a given
Liquidation Amount and/or a given period, the amount of Additional Interest (as
defined in the Indenture) paid by the Depositor on a Like Amount of Debentures
for such period.
"Additional Sums" has the meaning specified in Section 10.6 of the
Indenture.
"Additional Taxes" has the meaning specified in Section 1.1 of the
Indenture.
"Administrators" means each Person appointed in accordance with Section
8.20 solely in such Person's capacity as Administrator of the Issuer Trust
heretofore created and continued hereunder and not in such Person's individual
capacity, or any successor Administrator appointed as herein provided.
"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.
"Applicable Procedures" means, with respect to any transfer or transaction
involving a Book-Entry Capital Security, the rules and procedures of the
Clearing Agency for such Book-
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Entry Capital Security, in each case to the extent applicable to such
transaction and as in effect from time to time.
"Bank" has the meaning specified in the preamble to this Trust Agreement.
"Bankruptcy Event" means, with respect to any Person:
(a) the entry of a decree or order by a court having jurisdiction in the
premises judging such Person a bankrupt or insolvent, or approving as
properly filed a petition seeking reorganization, arrangement, adjudication
or composition of or in respect of such Person 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 such Person 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 60 consecutive days; or
(b) the institution by such Person 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 similar official) of such Person or of any substantial part of its
property, or the making by it of an assignment for the benefit of
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 such Person in furtherance
of any such action.
"Bankruptcy Laws" has the meaning specified in Section 10.10.
"Board of Directors" means the board of directors of the Depositor or the
Executive Committee of the board of directors of the Depositor (or any other
committee of the board of directors of the Depositor performing similar
functions) or a committee designated by the board of directors of the Depositor
(or any such committee), comprised of two or more members of the board of
directors of the Depositor or officers of the Depositor, or both.
"Board Resolution" means a copy of a resolution certified by the Secretary
or an Assistant Secretary of the Depositor to have been duly adopted by the
Depositor's Board of Directors, or officers of the Depositor to which authority
to act on behalf of the Board of Directors has been delegated and to be in full
force and effect on the date of such certification, and delivered to the Issuer
Trustees.
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"Book-Entry Capital Security" means a Capital Security, the ownership and
transfers of which shall be made through book entries by a Clearing Agency as
described in Section 5.4.
"Business Day" means a day other than (a) a Saturday or Sunday, (b) a day
on which banking institutions in The City of New York are authorized or required
by law or executive order to remain closed or (c) a day on which the Property
Trustee's Corporate Trust Office or the Corporate Trust Office of the Debenture
Trustee is closed for business.
"Capital Security" means an undivided beneficial interest in the assets of
the Issuer Trust, having a Liquidation Amount of [$25] [$1,000] and having the
rights provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution to the extent provided herein.
"Capital Securities Certificate" means a certificate evidencing ownership
of Capital Securities, substantially in the form attached as Exhibit E.
"Cedel" means Cedel Bank, societe anonyme (or any successor securities
clearing agency).
"Certificate Depository Agreement" means the agreement among the Issuer
Trust, the Depositor and DTC, as the initial Clearing Agency, dated as of the
Closing Date, substantially in the form attached as Exhibit B, as the same may
be amended and supplemented from time to time.
"Clearing Agency" means an organization registered as a "clearing agency"
pursuant to Section 17A of the Exchange Act. DTC will be the initial Clearing
Agency.
"Clearing Agency Participant" means a broker, dealer, bank, other financial
institution or other Person for whom from time to time a Clearing Agency effects
book-entry transfers and pledges of securities deposited with the Clearing
Agency.
"Closing Date" means the Time of Delivery, which date is also the date of
execution and delivery of this Trust Agreement.
"Code" means the United States Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission, as from time to
time constituted, created under the Exchange Act, or, if at any time after the
execution of this instrument such Securities and Exchange 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.
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"Common Securities Certificate" means a certificate evidencing ownership of
Common Securities, substantially in the form attached as Exhibit C.
"Common Security" means an undivided beneficial interest in the assets of
the Issuer Trust, having a Liquidation Amount of [$25] [$1,000] and having the
rights provided therefor in this Trust Agreement, including the right to receive
Distributions and a Liquidation Distribution to the extent provided herein.
"Corporate Trust Office" means (i) when used with respect to the Property
Trustee, the principal office of the Property Trustee located in the City of New
York, which at the time of the execution of this Trust Agreement is located at
Four Albany Street, New York, New York 10006; Attention: Corporate Trust and
Agency Group.
"Debenture Event of Default" means any "Event of Default" specified in
Section 5.1 of the Indenture.
"Debenture Redemption Date" means, with respect to any Debentures to be
redeemed under the Indenture, the date fixed for redemption of such Debentures
under the Indenture, including any date fixed for redemption pursuant to the
occurrence of a Tax Event or an Investment Company Event.
"Debenture Trustee" means the Person identified as the "Trustee" in the
Indenture, solely in its capacity as Trustee pursuant to the Indenture and not
in its individual capacity, or its successor in interest in such capacity, or
any successor Trustee appointed as provided in the Indenture.
"Debentures" means the Depositor's ____% Junior Subordinated Deferrable
Interest Debentures issued pursuant to the Indenture.
"Definitive Capital Securities Certificates" means either or both (as the
context requires) of (i) Capital Securities Certificates issued as Global
Capital Securities as provided in Section 5.2 or 5.4, and (ii) Capital
Securities Certificates issued in certificated, fully registered form as
provided in Section 5.2, 5.4 or 5.5.
"Delaware Business Trust Act" means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. Code (S) 3801 et seq., or any successor statute thereto, in each
case as amended from time to time.
"Delaware Trustee" means the Person identified as the "Delaware Trustee" in
the preamble to this Trust Agreement, solely in its capacity as Delaware Trustee
of the trust heretofore created and continued hereunder and not in its
individual capacity, or its successor in interest in such capacity, or any
successor Delaware trustee appointed as herein provided.
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"Depositor" has the meaning specified in the preamble to this Trust
Agreement.
"Distribution Date" has the meaning specified in Section 4.1(a).
"Distributions" means amounts payable in respect of the Trust Securities as
provided in Section 4.1.
"DTC" means The Depository Trust Company or any successor thereto.
"Early Termination Event" has the meaning specified in Section 9.2.
"ERISA" means the Employee Retirement Income Security Act of 1974, and any
successor statute thereto, in each case as amended from time to time.
"Euroclear" means the Euroclear Clearance System (or any successor
securities clearing agency), as operated by Morgan Guaranty Trust Company of New
York, Brussels office.
"European Capital Securities" means Capital Securities that are sold to
investors in Europe and settled through Euroclear and Cedel.
"Event of Default" means any one of the following events (whatever the
reason for such event and whether it shall be voluntary or involuntary or be
effected by operation of law or pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body):
(a) the occurrence of a Debenture Event of Default; or
(b) default by the Issuer Trust in the payment of any Distribution when it
becomes due and payable, and continuation of such default for a period of
30 days; or
(c) default by the Issuer Trust in the payment of any Redemption Price of
any Trust Security when it becomes due and payable; or
(d) default in the performance, or breach, in any material respect, of any
covenant or warranty of the Issuer Trustees in this Trust Agreement (other
than those specified in clause (b) or (c) above) and continuation of such
default or breach for a period of 60 days after there has been given, by
registered or certified mail, to the Issuer Trustees and to the Depositor
by the Holders of at least 25% in aggregate Liquidation Amount of the
Outstanding Capital Securities a written notice specifying such default or
breach and requiring it to be remedied and stating that such notice is a
"Notice of Default" hereunder; or
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(e) the occurrence of a Bankruptcy Event with respect to the Property
Trustee if a successor Property Trustee has not been appointed within 90
days thereof.
"Exchange Act" means the Securities Exchange Act of 1934, and any successor
statute thereto, in each case as amended from time to time.
"Expense Agreement" means the Agreement as to Expenses and Liabilities,
dated as of the Closing Date, between the Depositor, in its capacity as holder
of the Common Securities, and the Issuer Trust, substantially in the form
attached as Exhibit D, as amended from time to time.
"Expiration Date" has the meaning specified in Section 9.1.
"Global Capital Security" means a Capital Securities Certificate evidencing
ownership of Book-Entry Capital Securities.
"Guarantee Agreement" means the Guarantee Agreement executed and delivered
by the Depositor and [Bankers Trust Company], as guarantee trustee,
contemporaneously with the execution and delivery of this Trust Agreement, for
the benefit of the holders of the Capital Securities, as amended from time to
time.
"Holder" means a Person in whose name a Trust Security or Trust Securities
are registered in the Securities Register; any such Person shall be deemed to be
a beneficial owner within the meaning of the Delaware Business Trust Act.
"Indenture" means the Junior Subordinated Indenture, dated as of June __,
199_, between the Depositor and the Debenture Trustee, as trustee, as amended or
supplemented from time to time.
"Investment Company Act" means the Investment Company Act of 1940, or any
successor statute thereto, in each case as amended from time to time.
"Investment Company Event" means the receipt by the Issuer 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 or a written change
(including any announced prospective change) in interpretation or application
of law or regulation by any legislative body, court, governmental agency or
regulatory authority, there is more than an insubstantial risk that the Issuer
Trust is or will be considered an "investment company" that is required to be
registered under the Investment Company Act, which change or prospective change
becomes effective or would become effective, as the case may be, on or after the
date of the issuance of the Capital Securities.
"Issuer Trust" means the Delaware business trust known as "American Express
Company Capital Trust _" which was formed on May __, 199_ under the Delaware
Business Trust Act
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pursuant to the Original Trust Agreement and the filing of the Certificate of
Trust, and continued pursuant to this Trust Agreement.
"Issuer Trustees" has the meaning specified in the preamble to this Trust
Agreement.
"Lien" means any lien, pledge, charge, encumbrance, mortgage, deed of
trust, adverse ownership interest, hypothecation, assignment, security interest
or preference, priority or other security agreement or preferential arrangement
of any kind or nature whatsoever.
"Like Amount" means (a) with respect to a redemption of any Trust
Securities, Trust Securities having a Liquidation Amount equal to the principal
amount of Debentures to be contemporaneously redeemed in accordance with the
Indenture, the proceeds of which will be used to pay the Redemption Price of
such Trust Securities, (b) with respect to a distribution of Debentures to
Holders of Trust Securities in connection with a dissolution or liquidation of
the Issuer Trust, Debentures having a principal amount equal to the Liquidation
Amount of the Trust Securities of the Holder to whom such Debentures are
distributed, and (c) with respect to any distribution of Additional Amounts to
Holders of Trust Securities, Debentures having a principal amount equal to the
Liquidation Amount of the Trust Securities in respect of which such distribution
is made.
"Liquidation Amount" means the stated amount of [$25] [$1,000] per Trust
Security.
"Liquidation Date" means the date of the dissolution, winding-up or
termination of the Issuer Trust pursuant to Section 9.4.
"Liquidation Distribution" has the meaning specified in Section 9.4(d).
"Majority in Liquidation Amount of the Capital Securities" or "Majority in
Liquidation Amount of the Common Securities" means, except as provided by the
Trust Indenture Act, Capital Securities or Common Securities, as the case may
be, representing more than 50% of the aggregate Liquidation Amount of all then
Outstanding Capital Securities or Common Securities, as the case may be.
"Officers' Certificate" means a certificate signed 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 Depositor, and delivered to the Issuer Trustees. Any Officers'
Certificate delivered with respect to compliance with a condition or covenant
provided for in this Trust Agreement shall include:
(a) a statement by each officer signing the Officers' Certificate that
such officer has read the covenant or condition and the definitions
relating thereto;
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(b) a brief statement of the nature and scope of the examination or
investigation undertaken by such officer in rendering the Officers'
Certificate;
(c) a statement that such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such
officer to express an informed opinion as to whether or not such covenant
or condition has been complied with; and
(d) a statement as to whether, in the opinion of such officer, such
condition or covenant has been complied with.
"Opinion of Counsel" means a written opinion of counsel, who may be counsel
for or an employee of the Depositor or any Affiliate of the Depositor.
"Original Trust Agreement" has the meaning specified in the recitals to
this Trust Agreement.
"Outstanding", when used with respect to Trust Securities, means, as of the
date of determination, all Trust Securities theretofore executed and delivered
under this Trust Agreement, except:
(a) Trust Securities theretofore canceled by the Property Trustee or
delivered to the Property Trustee for cancellation;
(b) Trust Securities for whose payment or redemption money in the
necessary amount has been theretofore deposited with the Property Trustee
or any Paying Agent; provided that, if such Trust Securities are to be
redeemed, notice of such redemption has been duly given pursuant to this
Trust Agreement; and
(c) Trust Securities that have been paid or in exchange for or in lieu of
which other Trust Securities have been executed and delivered pursuant to
Sections 5.4, 5.5, 5.6 and 5.11;
provided, however, that in determining whether the Holders of the requisite
Liquidation Amount of the Outstanding Capital Securities have given any request,
demand, authorization, direction, notice, consent or waiver hereunder, Capital
Securities owned by the Depositor, any Issuer Trustee, any Administrator or any
Affiliate of the Depositor, any Issuer Trustee or any Administrator shall be
disregarded and deemed not to be Outstanding, except that (a) in determining
whether any Issuer Trustee or any Administrator shall be protected in relying
upon any such request, demand, authorization, direction, notice, consent or
waiver, only Capital Securities that such Issuer Trustee or such Administrator,
as the case may be, knows to be so owned shall be so disregarded, and (b) the
foregoing shall not apply at any time when all of the Outstanding Capital
Securities are owned by the Depositor, one or more of the Issuer Trustees, one
or more of the Administrators and/or any such Affiliate. Capital Securities so
owned that have been pledged in good faith may be regarded as Outstanding if the
pledgee establishes to the
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satisfaction of the Administrators the pledgee's right so to act with respect to
such Capital Securities and that the pledgee is not the Depositor or any
Affiliate of the Depositor.
"Owner" means each Person who is the beneficial owner of Book-Entry Capital
Securities as reflected in the records of the Clearing Agency or, if a Clearing
Agency Participant is not the Owner, then as reflected in the records of a
Person maintaining an account with such Clearing Agency (directly or indirectly,
in accordance with the rules of such Clearing Agency).
"Paying Agent" means any paying agent or co-paying agent appointed pursuant
to Section 5.10 and shall initially be the Bank.
"Payment Account" means a segregated non-interest-bearing corporate trust
account maintained by the Property Trustee in its trust department for the
benefit of the Holders in which all amounts paid in respect of the Debentures
will be held and from which the Property Trustee, through the Paying Agent,
shall make payments to the Holders in accordance with Sections 4.1 and 4.2.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, company,
limited liability company, trust, unincorporated association, or government or
any agency or political subdivision thereof, or any other entity of whatever
nature.
"Property Trustee" means the Person identified as the "Property Trustee" in
the preamble to this Trust Agreement, solely in its capacity as Property Trustee
of the trust heretofore formed and continued hereunder and not in its individual
capacity, or its successor in interest in such capacity, or any successor
property trustee appointed as herein provided.
"Redemption Date" means, with respect to any Trust Security to be redeemed,
the date fixed for such redemption by or pursuant to this Trust Agreement;
provided that each Debenture Redemption Date and the stated maturity of the
Debentures shall be a Redemption Date for a Like Amount of Trust Securities.
"Redemption Price" means, with respect to any Trust Security, the
Liquidation Amount of such Trust Security, plus accumulated and unpaid
Distributions to the Redemption Date, plus the related amount of the premium, if
any, paid by the Depositor upon the concurrent redemption of a Like Amount of
Debentures.
"Relevant Trustee" has the meaning specified in Section 8.10.
"Responsible Officer", when used with respect to the Property Trustee,
means any officer assigned to the Corporate Trust Office, including any managing
director, vice president, assistant vice president, assistant treasurer,
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 having direct responsibility for the administration of this Trust
Agreement, and also, with respect to a particular matter, any other officer to
whom such matter is referred because of such officer's knowledge of and
familiarity with the particular subject.
"Securities Act" means the Securities Act of 1933, and any successor
statute thereto, in each case as amended from time to time.
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"Securities Certificate" means any one of the Common Securities
Certificates or the Capital Securities Certificates.
"Securities Register" and "Securities Registrar" have the respective
meanings specified in Section 5.5.
"Successor Capital Securities" of any particular Capital Securities
Certificate means every Capital Securities Certificate issued after, and
evidencing all or a portion of the same beneficial interest in the Issuer Trust
as that evidenced by, such particular Capital Securities Certificate; and, for
the purposes of this definition, any Capital Securities Certificate executed and
delivered under Section 5.6 in exchange for or in lieu of a mutilated,
destroyed, lost or stolen Capital Securities Certificate shall be deemed to
evidence the same beneficial interest in the Issuer Trust as the mutilated,
destroyed, lost or stolen Capital Securities Certificate.
"Tax Event" means the receipt by the Issuer Trust of an Opinion of 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 political subdivision or
taxing authority thereof or therein, or (b) any judicial decision or any
official administrative pronouncement (including any private letter ruling,
technical advice memorandum or field service advice) or regulatory procedure (an
"Administrative Action"), regardless of whether such judicial decision or
Administrative Action is issued to or in connection with a proceeding involving
the Corporation or the Issuer Trust and whether or not subject to review or
appeal, which amendment, clarification, change, Administrative Action or
decision is enacted, promulgated or announced, in each case, on or after the
date hereof, there is more than an insubstantial risk that (i) the Issuer Trust
is, or will be within 90 days of the date of such opinion, subject to United
States federal income tax with respect to income received or accrued on the
Junior Subordinated Debentures, (ii) interest payable by the Corporation on the
Junior Subordinated Debenture is not, or within 90 days of the date of such
opinion, will not be, deductible by the Corporation, in whole or in part, for
United States federal income tax purposes, or (iii) the Issuer 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.
"Time of Delivery" has the meaning specified in the Underwriting Agreement.
"Trust Agreement" means this Amended and Restated Trust Agreement, as the
same may be modified, amended or supplemented in accordance with the applicable
provisions hereof, including (i) all exhibits, and (ii) for all purposes of this
Trust Agreement and any such modification, amendment or supplement, the
provisions of the Trust Indenture Act that are deemed to be a part of and govern
this Trust Agreement and any such modification, amendment or supplement,
respectively.
"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 if
the Trust Indenture Act of 1939 is
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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.
"Trust Property" means (a) the Debentures, (b) any cash on deposit in, or
owing to, the Payment Account, and (c) all proceeds and rights in respect of the
foregoing and any other property and assets for the time being held or deemed to
be held by the Property Trustee pursuant to the trusts of this Trust Agreement.
"Trust Security" means any one of the Common Securities or the Capital
Securities.
"Underwriting Agreement" means the Pricing Agreement, dated as of ____ __,
199_, among the Issuer Trust, the Depositor and the Underwriters named therein,
as the same may be amended from time to time and includes the Underwriting
Agreement incorporated therein by reference.
"Vice President," when used with respect to the Depositor, means any duly
appointed vice president, whether or not designated by a number or a word or
words added before or after the title "vice president."
ARTICLE II.
Continuation of the Issuer Trust
Section 2.1. Name.
The trust continued hereby shall be known as "American Express Company
Capital Trust _", as such name may be modified from time to time by the
Administrators following written notice to the Holders of Trust Securities and
the Issuer Trustees, in which name the Administrators and the Trustees may
conduct the business of the Issuer Trust, make and execute contracts and other
instruments on behalf of the Issuer Trust and sue and be sued.
Section 2.2. Office of the Delaware Trustee; Principal Place of Business.
The address of the Delaware Trustee in the State of Delaware is Bankers
Trust (Delaware), E.A. Delle Donne Corporate Center, Montgomery Building, 1011
Centre Road, Suite 200, Wilmington, Delaware 19805 Attention: Lisa Wilkins, or
such other address in the State of Delaware as the Delaware Trustee may
designate by written notice to the Holders, the Depositor, the Property Trustee
and the Administrators. The principal executive office of the Issuer Trust is
World Financial Center, 200 Vesey Street, New York, New York 10285, Attention:
Secretary.
Section 2.3. Initial Contribution of Trust Property; Organizational
Expenses.
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The Property Trustee acknowledges receipt from the Depositor in connection
with the Original Trust Agreement of the sum of $10, which constituted the
initial Trust Property. The Depositor shall pay organizational expenses of the
Issuer Trust as they arise or shall, upon request of any Issuer Trustee,
promptly reimburse such Issuer Trustee for any such expenses paid by such Issuer
Trustee. The Depositor shall make no claim upon the Trust Property for the
payment of such expenses.
Section 2.4. Issuance of the Capital Securities.
On ____ __, 199_, the Depositor, both on its own behalf and on behalf of
the Issuer Trust pursuant to the Original Trust Agreement, executed and
delivered the Underwriting Agreement. Contemporaneously with the execution and
delivery of this Trust Agreement, an Administrator, on behalf of the Issuer
Trust, shall manually execute in accordance with Sections 5.3 and 8.9(a) and the
Property Trustee shall deliver to the underwriters, Capital Securities
Certificates, registered in the names requested by the underwriters, evidencing
an aggregate of [20,000,000] [500,000] Capital Securities having an aggregate
Liquidation Amount of $500,000,000, against receipt of the aggregate purchase
price of such Capital Securities of $500,000,000.00 by the Property Trustee.
Section 2.5. Issuance of the Common Securities; Subscription and Purchase
of Debentures.
Contemporaneously with the execution and delivery of this Trust Agreement,
an Administrator, on behalf of the Issuer Trust, shall execute in accordance
with Sections 5.2 and 5.3 and the Property Trustee shall deliver to the
Depositor Common Securities Certificates, registered in the name of the
Depositor, evidencing an aggregate of [618,560] [15,464] Common Securities
having an aggregate Liquidation Amount of $15,464,000, against receipt of the
aggregate purchase price of such Common Securities of $15,464,000, to the
Property Trustee. Contemporaneously therewith, an Administrator, on behalf of
the Issuer Trust, shall subscribe for and purchase from the Depositor
Debentures, registered in the name of the Trust and held on behalf of the
Trust by the Property Trustee and having an aggregate principal amount equal to
$515,464,000, and, in satisfaction of the purchase price for such Debentures,
the Property Trustee, on behalf of the Issuer Trust, shall deliver to the
Depositor the sum of $515,464,000 (being the sum of the amounts delivered to the
Property Trustee pursuant to (i) the second sentence of Section 2.4, and (ii)
the first sentence of this Section 2.5).
Section 2.6. Continuation of Trust.
The exclusive purposes and functions of the Issuer Trust are (a) to issue
and sell Trust Securities and use the proceeds from such sale to acquire the
Debentures, and (b) to engage in only those activities necessary, or incidental
thereto. The Depositor hereby appoints the Issuer Trustees as trustees of the
Issuer Trust, to have all the rights, powers and duties to the extent set
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forth herein, and the Issuer Trustees hereby accept such appointment. The
Property Trustee hereby declares that it will hold the Trust Property upon and
subject to the conditions set forth herein for the benefit of the Issuer Trust
and the Holders. The Administrators shall have only those ministerial duties set
forth herein with respect to accomplishing the purposes of the Issuer Trust and
shall not be trustees or, to the fullest extent permitted by law, fiduciaries
with respect to the Issuer Trust or the Holders. The Property Trustee shall have
the right and power to perform those duties assigned to the Administrators. 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 Property
Trustee or the Administrators set forth herein. The Delaware Trustee shall be
one of the trustees of the Issuer Trust for the sole and limited purpose of
fulfilling the requirements of Section 3807 of the Delaware Business Trust Act
and for taking such actions as are required to be taken by a Delaware trustee
under the Delaware Business Trust Act.
Section 2.7. Authorization to Enter into Certain Transactions.
(a) The Issuer Trustees and the Administrators shall conduct the affairs
of the Issuer Trust in accordance with the terms of this Trust Agreement.
Subject to the limitations set forth in paragraph (b) of this Section, and in
accordance with the following provisions (i) and (ii), the Issuer Trustees and
the Administrators shall have the authority to enter into all transactions and
agreements determined by the Issuer Trustees or the Administrators to be
appropriate in exercising the authority, express or implied, otherwise granted
to the Issuer Trustees or the Administrators, as the case may be, under this
Trust Agreement, and to perform all acts in furtherance thereof, including the
following:
(i) Each Administrator shall have the power and authority to act on
behalf of the Issuer Trust with respect to the following matters:
(A) the issuance and sale of the Trust Securities;
(B) to cause the Issuer Trust to enter into, and to execute,
deliver and perform on behalf of the Issuer Trust, the Expense
Agreement and the Certificate Depository Agreement and such other
agreements as may be necessary or desirable in connection with the
purposes and function of the Issuer Trust;
(C) assisting in the registration of the Capital Securities
under the Securities Act, and under applicable state securities or
blue sky laws and the qualification of this Trust Agreement as a trust
indenture under the Trust Indenture Act;
(D) assisting in the listing of the Capital Securities upon
such securities exchange or exchanges as shall be determined by the
Depositor, with the registration of the Capital Securities under the
Exchange Act, and with the
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preparation and filing of all periodic and other reports and other
documents pursuant to the foregoing;
(E) assisting in the sending of notices (other than notices
of default) and other information regarding the Trust Securities and
the Debentures to the Holders in accordance with this Trust Agreement;
(F) the consent to the appointment of a Paying Agent,
authenticating agent and Securities Registrar in accordance with this
Trust Agreement (which consent shall not be unreasonably withheld);
(G) execution of the Trust Securities on behalf of the Trust
in accordance with this Trust Agreement;
(H) execution and delivery of closing certificates, if any,
pursuant to the Underwriting Agreement and application for a taxpayer
identification number for the Issuer Trust;
(I) unless otherwise determined by the Property Trustee or
Holders of at least a Majority in Liquidation Amount of the Capital
Securities or as otherwise required by the Delaware Business Trust Act
or the Trust Indenture Act, to execute on behalf of the Issuer Trust
(either acting alone or together with any or all of the
Administrators) any documents that the Administrators have the power
to execute pursuant to this Trust Agreement; and
(J) the taking of any action incidental to the foregoing as
the Issuer Trustees may from time to time determine is necessary or
advisable to give effect to the terms of this Trust Agreement.
(ii) The Property Trustee shall have the power, duty and authority to
act on behalf of the Issuer Trust with respect to the following matters:
(A) the establishment of the Payment Account;
(B) the receipt of the Debentures;
(C) the collection of interest, principal and any other
payments made in respect of the Debentures and the holding of such
amounts in the Payment Account;
(D) the distribution through the Paying Agent of amounts
distributable to the Holders in respect of the Trust Securities;
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(E) the exercise of all of the rights, powers and privileges
of a holder of the Debentures;
(F) the sending of notices of default and other information
regarding the Trust Securities and the Debentures to the Holders in
accordance with this Trust Agreement;
(G) the distribution of the Trust Property in accordance with
the terms of this Trust Agreement;
(H) to the extent provided in this Trust Agreement, the
winding up of the affairs of and liquidation of the Issuer Trust and
the preparation, execution and filing of the certificate of
cancellation with the Secretary of State of the State of Delaware;
(I) after an Event of Default (other than under paragraph
(b), (c), (d) or (e) of the definition of such term if such Event of
Default is by or with respect to the Property Trustee) the taking of
any action incidental to the foregoing as the Property Trustee may
from time to time determine is necessary or advisable to give effect
to the terms of this Trust Agreement and protect and conserve the
Trust Property for the benefit of the Holders (without consideration
of the effect of any such action on any particular Holder); and
(J) any of the duties, liabilities, powers or the authority
of the Administrators set forth in Section 2.7(a)(i)(E), (F) and (J)
herein; and in the event of a conflict between the action of the
Administrators and the action of the Property Trustee, the action of
the Property Trustee shall prevail.
(b) So long as this Trust Agreement remains in effect, the Issuer Trust
(or the Issuer Trustees or Administrators acting on behalf of the Issuer Trust)
shall not undertake any business, activities or transaction except as expressly
provided herein or contemplated hereby. In particular, neither the Issuer
Trustees nor the Administrators shall (i) acquire any investments or engage in
any activities not authorized by this Trust Agreement, (ii) sell, assign,
transfer, exchange, mortgage, pledge, set-off or otherwise dispose of any of the
Trust Property or interests therein, including to Holders, except as expressly
provided herein, (iii) take any action that would reasonably be expected to
cause the Issuer Trust to become taxable as a corporation or classified as other
than a grantor trust for United States federal income tax purposes, (iv) take or
consent to any action that would cause the Junior Subordinated Debentures to be
treated as other than indebtedness of the Corporation for United States federal
income tax purposes, (v) incur any indebtedness for borrowed money or issue any
other debt, or (vi) take or consent to any action that would result in the
placement of a Lien on any of the Trust Property. The Property Trustee shall
defend all claims and demands of all Persons at any time claiming any Lien on
any of the Trust Property adverse to the interest of the Issuer Trust or the
Holders in their capacity as Holders.
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(c) In connection with the issue and sale of the Capital Securities, the
Depositor shall have the right and responsibility to assist the Issuer Trust
with respect to, or effect on behalf of the Issuer Trust, the following (and any
actions taken by the Depositor in furtherance of the following prior to the date
of this Trust Agreement are hereby ratified and confirmed in all respects):
(i) the preparation and filing by the Issuer Trust with the
Commission and the execution on behalf of the Issuer Trust of a
registration statement on the appropriate form in relation to the Capital
Securities, including any amendments thereto and the taking of any action
necessary or desirable to sell the Capital Securities in a transaction or a
series of transactions pursuant thereto;
(ii) the determination of the States or other jurisdictions, if
any, in which to take appropriate action to qualify or register for sale
all or part of the Capital Securities and the determination of any and all
such acts, other than actions that must be taken by or on behalf of the
Issuer Trust, and the advice to the Issuer Trust of actions they must take
on behalf of the Issuer Trust, and the preparation for execution and filing
of any documents to be executed and filed by the Issuer Trust or on behalf
of the Issuer Trust, as the Depositor deems necessary or advisable in order
to comply with the applicable laws of any such States in connection with
the sale of the Capital Securities;
(iii) the preparation for filing by the Issuer Trust and execution
on behalf of the Issuer Trust of any application to the New York Stock
Exchange or any other national stock exchange or the Nasdaq National Market
for listing upon notice of issuance of any Capital Securities;
(iv) the preparation for filing by the Issuer Trust with the
Commission and the execution on behalf of the Issuer Trust of any
registration statement on Form 8-A relating to Capital Securities under
Section 12(b) or 12(g) of the Exchange Act, including any amendments
thereto;
(v) the negotiation of the terms of, and the execution and
delivery of, the Underwriting Agreement providing for the sale of the
Capital Securities; and
(vi) the taking of any other actions necessary or desirable
to carry out any of the foregoing activities.
(d) Notwithstanding anything herein to the contrary, the Administrators
and the Issuer Trustees are authorized and directed to conduct the affairs of
the Issuer Trust and to operate the Issuer Trust so that the Issuer Trust will
not be deemed to be an "investment company" required to be registered under the
Investment Company Act, and will not be taxable as a corporation or
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classified as other than a grantor trust for United States Federal income tax
purposes and so that the Debentures will be treated as indebtedness of the
Depositor for United States federal income tax purposes. In this connection,
each Administrator, the Property Trustee and the Holders of at least a Majority
in Liquidation Amount of the Common Securities are authorized to take any
action, not inconsistent with applicable law, the Certificate of Trust or this
Trust Agreement, that such Administrator, the Property Trustee or Holders of
Common Securities determine in their discretion to be necessary or desirable for
such purposes, as long as such action does not adversely affect in any material
respect the interests of the Holders of the Outstanding Capital Securities. [In
no event shall the Administrator take any action pursuant to the preceding
sentence or any other provision herein that would constitute discretionary
control over the assets of the Trust for purposes of Section 3(21) of ERISA]. In
no event shall the Administrators or the Issuer Trustees be liable to the Issuer
Trust or the Holders for any failure to comply with this section that results
from a change in law or regulation or in the interpretation thereof.
Section 2.8. Assets of Trust.
The assets of the Issuer Trust shall consist of the Trust Property.
Section 2.9. Title to Trust Property.
Legal title to all Trust Property shall be vested at all times in the
Property Trustee (in its capacity as such) and shall be held and administered by
the Property Trustee in trust for the benefit of the Issuer Trust and the
Holders in accordance with this Trust Agreement.
ARTICLE III.
Payment Account
Section 3.1. Payment Account.
(a) On or prior to the Closing Date, the Property Trustee shall establish
the Payment Account. The Property Trustee and its agents shall have exclusive
control and sole right of withdrawal with respect to the Payment Account for the
purpose of making deposits in and withdrawals from the Payment Account in
accordance with this Trust Agreement. All monies and other property deposited or
held from time to time in the Payment Account shall be held by the Property
Trustee in the Payment Account for the exclusive benefit of the Holders and for
distribution as herein provided, including (and subject to) any priority of
payments provided for herein.
(b) The Property Trustee shall deposit in the Payment Account, promptly
upon receipt, all payments of principal of or interest on, and any other
payments or proceeds with
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respect to, the Debentures. Amounts held in the Payment Account shall not be
invested by the Property Trustee pending distribution thereof.
ARTICLE IV.
Distributions; Redemption
Section 4.1. Distributions.
(a) The Trust Securities represent undivided beneficial interests in the
Trust Property, and Distributions (including of Additional Amounts) will be made
on the Trust Securities at the rate and on the dates that payments of interest
(including any Additional Interest, as defined in the Indenture) are made on the
Debentures. Accordingly:
(i) Distributions on the Trust Securities shall be cumulative, and
shall accumulate whether or not there are funds of the Trust available for
the payment of Distributions. Distributions shall accumulate from __ __,
199_, and, except as provided in clause (ii) below, shall be payable
[quarterly] [semi-annually] in arrears on [March 1, June 1, September 1 and
December 1] [June 1 and December 1] of each year, commencing on [September
1] [December 1], 1998. If any date on which a Distribution is otherwise
payable on the Trust Securities is not a Business Day, then the payment of
such Distribution shall 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 on which
such payment was originally payable (each date on which distributions are
payable in accordance with this Section 4.1(a), a "Distribution Date").
(ii) In the event (and to the extent) that the Depositor exercises
its right under the Indenture to defer the payment of interest on the
Debentures, [quarterly] [semi-annual] Distributions on the Capital
Securities shall be deferred.
(iii) Distributions shall accumulate in respect of the Capital
Securities at a rate of ____% per annum of the Liquidation Amount of the
Trust Securities. The amount of Distributions payable for any period less
than a full Distribution period shall be computed on the basis of a 360-day
year of twelve 30-day months and the actual number of days elapsed in a
partial month in a period. Distributions payable for each full Distribution
period will be computed by dividing the rate per annum by [four] [two]. The
amount of Distributions payable for any period shall include any Additional
Amounts in respect of such period.
(iv) Distributions on the Trust Securities shall be made by the
Property Trustee from the Payment Account and shall be payable on each
Distribution Date only to the
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extent that the Issuer Trust has funds then on hand and available in the
Payment Account for the payment of such Distributions.
(b) Distributions on the Trust Securities with respect to a Distribution
Date shall be payable to the Holders thereof as they appear on the Securities
Register for the Trust Securities at the close of business on the relevant
record date, which shall be at the close of business on the fifteenth day
(whether or not a Business Day) next preceding the relevant Distribution Date.
Section 4.2. Redemption.
(a) On each Debenture Redemption Date and on the stated maturity of the
Debentures, the Issuer Trust will be required to redeem a Like Amount of Trust
Securities at the Redemption Price.
(b) Notice of redemption shall be given by the Property Trustee by first-
class mail, postage prepaid, mailed not less than 30 nor more than 60 days prior
to the Redemption Date to each Holder of Trust Securities to be redeemed, at
such Holder's address appearing in the Security Register. All notices of
redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price or if the Redemption Price cannot be
calculated prior to the time the notice is required to be sent, the
estimate of the Redemption Price provided pursuant to (and as defined in)
the Indenture together with a statement that it is an estimate and that the
actual Redemption Price will be calculated on the third Business Day prior
to the Redemption Date (and if an estimate is provided, a further notice
shall be sent of the actual Redemption Price on the date that such
Redemption Price is calculated);
(iii) the CUSIP number or CUSIP numbers of the Capital Securities
affected;
(iv) if less than all the Outstanding Trust Securities are to be
redeemed, the identification and the aggregate Liquidation Amount of the
particular Trust Securities to be redeemed;
(v) that on the Redemption Date the Redemption Price will become due
and payable upon each such Trust Security to be redeemed and that
Distributions thereon will cease to accumulate on and after said date,
except as provided in Section 4.2(d) below; and
(vi) the place or places where the Trust Securities are to be
surrendered for the payment of the Redemption Price.
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The Issuer Trust in issuing the Trust Securities may use "CUSIP" numbers
(if then generally in use), and, if so, the Property Trustee shall indicate the
"CUSIP" numbers of the Trust Securities in notices of redemption and related
materials 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 Trust Securities or as contained in any notice of redemption and
related materials.
(c) The Trust Securities redeemed on each Redemption Date shall be
redeemed at the Redemption Price with the proceeds from the contemporaneous
redemption of Debentures. Redemptions of the Trust Securities shall be made and
the Redemption Price shall be payable on each Redemption Date only to the extent
that the Issuer Trust has funds then on hand and available in the Payment
Account for the payment of such Redemption Price.
(d) If the Property Trustee gives a notice of redemption in respect of any
Capital Securities, then, by 12:00 noon, New York City time, on the Redemption
Date, subject to Section 4.2(c), the Property Trustee will, with respect to
Book-Entry Capital Securities, irrevocably deposit with the Clearing Agency
for such Book-Entry Capital Securities, to the extent available therefor, funds
sufficient to pay the applicable Redemption Price and will give such Clearing
Agency irrevocable instructions and authority to pay the Redemption Price to the
Holders of the Capital Securities. With respect to Capital Securities that are
not Book-Entry Capital Securities, the Property Trustee, subject to Section
4.2(c), will irrevocably deposit with the Paying Agent or Paying Agents, to the
extent available therefor, funds sufficient to pay the applicable Redemption
Price and will give the Paying Agent or Paying Agents irrevocable instructions
and authority to pay the Redemption Price to the Holders of the Capital
Securities upon surrender of their Capital Securities Certificates.
Notwithstanding the foregoing, Distributions payable on or prior to the
Redemption Date for any Trust Securities called for redemption shall be payable
to the Holders of such Trust Securities as they appear on the Securities
Register 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 Holders holding Trust Securities so
called for redemption will cease, except the right of such Holders to receive
the Redemption Price and any Distribution payable in respect of the Trust
Securities on or prior to the Redemption Date, but without interest, and such
Securities will cease to be Outstanding. In the event that any date on which any
Redemption Price is payable 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 (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. In the event that
payment of the Redemption Price in respect of any Trust Securities called for
redemption is improperly withheld or refused and not paid either by the Issuer
Trust or by the Depositor pursuant to the Guarantee Agreement, Distributions on
such Trust Securities will continue to accumulate, as set forth in Section 4.1,
from the Redemption Date originally established by the Issuer Trust for such
Trust Securities to
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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.
(e) Subject to Section 4.3(a), if less than all the Outstanding Trust
Securities are to be redeemed on a Redemption Date, then the aggregate
Liquidation Amount of Trust Securities to be redeemed shall be allocated pro
rata to the Common Securities and the Capital Securities based upon the relative
Liquidation Amounts of such classes. The particular Capital Securities to be
redeemed shall be selected on a pro rata basis based upon their respective
Liquidation Amounts not more than 60 days prior to the Redemption Date by the
Property Trustee from the Outstanding Capital Securities not previously called
for redemption, provided that so long as the Capital Securities are in book-
entry-only form, such selection shall be made in accordance with the customary
procedures for the Clearing Agency for the Capital Securities. The Property
Trustee shall promptly notify the Securities Registrar in writing of the Capital
Securities selected for redemption and, in the case of any Capital Securities
selected for partial redemption, the Liquidation Amount thereof to be redeemed.
For all purposes of this Trust Agreement, unless the context otherwise requires,
all provisions relating to the redemption of Capital Securities shall relate, in
the case of any Capital Securities redeemed or to be redeemed only in part, to
the portion of the aggregate Liquidation Amount of Capital Securities that has
been or is to be redeemed.
Section 4.3. Subordination of Common Securities.
(a) Payment of Distributions (including any Additional Amounts) on, the
Redemption Price of, and the Liquidation Distribution in respect of the Trust
Securities, as applicable, shall be made, subject to Section 4.2(e), pro rata
among the Common Securities and the Capital Securities based on the Liquidation
Amount of the Trust Securities; provided, however, that if on any Distribution
Date, Redemption Date or Liquidation Date any Event of Default resulting from a
Debenture Event of Default specified in Section 5.1(1) or 5.1(2) of the
Indenture shall have occurred and be continuing, no payment of any Distribution
(including any Additional Amounts) on, Redemption Price of, or Liquidation
Distribution in respect of any Common Security, and no other payment on account
of the redemption, liquidation or other acquisition of Common Securities, shall
be made unless payment in full in cash of all accumulated and unpaid
Distributions (including any Additional Amounts) on all 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 Outstanding Capital Securities then called for redemption, or in
the case of payment of the Liquidation Distribution the full amount of such
Liquidation Distribution on all Outstanding Capital Securities, shall have been
made or provided for, and all funds immediately available to the Property
Trustee shall first be applied to the payment in full in cash of all
Distributions (including any Additional Amounts) on, or the Redemption Price of,
the Capital Securities then due and payable.
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(b) In the case of the occurrence of any Event of Default resulting from
any Debenture Event of Default, the Holders of the Common Securities shall have
no right to act with respect to any such Event of Default under this Trust
Agreement until the effect of all such Events of Default with respect to the
Capital Securities have been cured, waived or otherwise eliminated. Until all
such Events of Default under this Trust Agreement with respect to the Capital
Securities have been so cured, waived or otherwise eliminated, the Property
Trustee shall act solely on behalf of the Holders of the Capital Securities and
not on behalf of the Holders of the Common Securities, and only the Holder of
all the Capital Securities will have the right to direct the Property Trustee to
act on their behalf.
Section 4.4. Payment Procedures.
Payments of Distributions (including any Additional Amounts) or of the
Redemption Price, Liquidation Amount or any other amounts in respect of the
Capital Securities shall be made by check mailed to the address of the Person
entitled thereto as such address shall appear on the Securities Register or, if
the Capital Securities are held by a Clearing Agency, such Distributions shall
be made to the Clearing Agency in immediately available funds. Payments in
respect of the Common Securities shall be made in such manner as shall be
mutually agreed between the Property Trustee and the Holder of all the Common
Securities.
SECTION 4.5. Withholding Tax.
The Issuer Trust and the Administrators shall comply with all withholding
and backup withholding tax requirements under United States federal, state and
local law. The Issuer Trust shall request, and the Holders shall provide to the
Issuer Trust, such forms or certificates as are necessary to establish an
exemption from withholding and backup withholding tax with respect to each
Holder, and any representations and forms as shall reasonably be requested by
the Issuer Trust to assist it in determining the extent of, and in fulfilling,
its withholding and backup withholding tax obligations. The Administrators shall
file required forms with applicable jurisdictions and, unless an exemption from
withholding and backup withholding tax is properly established by a Holder,
shall remit amounts withheld with respect to the Holder to applicable
jurisdictions. To the extent that the Issuer 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 overwithholding, 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 Issuer Trust may reduce subsequent
Distributions by the amount of such required withholding.
Section 4.6. Tax Returns and Reports.
The Administrators shall prepare (or cause to be prepared), at the
Depositor's expense, and file all United States federal, state and local tax and
information returns and reports required to be filed by or in respect of the
Issuer Trust. In this regard, the Administrators shall (a) prepare and file (or
cause to be prepared and filed) all Internal Revenue Service forms and returns
required to be filed
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in respect of the Issuer Trust in each taxable year of the Issuer Trust, and (b)
prepare and furnish (or cause to be prepared and furnished) to each Holder all
Internal Revenue Service forms and returns required to be provided by the Issuer
Trust. The Administrators shall provide the Depositor and the Property Trustee
with a copy of all such returns and reports promptly after such filing or
furnishing.
Section 4.7. Payment of Taxes, Duties, Etc. of the Issuer Trust.
Upon receipt under the Debentures of Additional Sums, the Property Trustee
shall promptly pay any Additional Taxes imposed on the Issuer Trust by the
United States or any other taxing authority.
Section 4.8. Payments under Indenture or Pursuant to Direct Actions.
Any amount payable hereunder to any Holder of Capital Securities (or any
Owner with respect thereto) shall be reduced by the amount of any corresponding
payment such Holder (or Owner) has directly received pursuant to Section 5.8 of
the Indenture or Section 5.13 of this Trust Agreement.
Section 4.9. Liability of the Holder of Common Securities.
Any Holder of the Common Securities shall be liable for the debts and
obligations of the Issuer Trust in the manner and to the extent set forth with
respect to the Corporation (as defined in the Expense Agreement) and
agrees that it shall be subject to all liabilities to which the Corporation
may be subject, and shall make all payments that the Corporation
is required to make, under the terms of the Expense Agreement.
ARTICLE V.
Securities Certificates
Section 5.1. Initial Ownership.
Upon the formation of the Issuer Trust and the contribution by the
Depositor referred to in Section 2.3 and until the issuance of the Trust
Securities, and at any time during which no Trust Securities are Outstanding,
the Depositor shall be the sole beneficial owner of the Issuer Trust.
Section 5.2. The Securities Certificates.
(a) The Capital Securities Certificates shall be issued in minimum
denominations of [$25] [$1,000] Liquidation Amount and integral multiples of
[$25] [$1,000] in excess thereof, and
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the Common Securities Certificates shall be issued in denominations of [$25]
[$1,000] Liquidation Amount and integral multiples thereof. The Securities
Certificates shall be executed on behalf of the Issuer Trust by manual signature
of at least one Administrator. Securities Certificates bearing the manual
signatures of individuals who were, at the time when such signatures shall have
been affixed, authorized to sign on behalf of the Issuer Trust, shall be validly
issued and entitled to the benefits of this Trust Agreement, notwithstanding
that such individuals or any of them shall have ceased to be so authorized prior
to the delivery of such Securities Certificates or did not hold such offices at
the date of delivery of such Securities Certificates. A transferee of a Trust
Securities Certificate shall become a Holder, and shall be entitled to the
rights and subject to the obligations of a Holder hereunder, upon due
registration of such Trust Securities Certificate in such transferee's name
pursuant to Section 5.5.
(b) Upon their original issuance, Capital Securities Certificates shall be
issued in the form of one or more Global Capital Securities registered in the
name of DTC, as Clearing Agency, or its nominee and deposited with DTC or a
custodian for DTC for credit by DTC to the respective accounts of the Owners
thereof (or such other accounts as they may direct), provided that upon deposit
all European Capital Securities shall be credited to or through accounts
maintained at DTC by or on behalf of Euroclear or Cedel.
(c) A single Common Securities Certificate representing the Common
Securities shall be issued to the Depositor in the form of a definitive Common
Securities Certificate.
Section 5.3. Execution and Delivery of Securities Certificates.
At the Time of Delivery, the Administrators shall cause Securities
Certificates, in an aggregate Liquidation Amount as provided in Sections 2.4 and
2.5, to be executed on behalf of the Issuer Trust and delivered to or upon the
written order of the Depositor, executed by an authorized officer thereof,
without further corporate action by the Depositor, in authorized denominations.
Section 5.4. Book-Entry Capital Securities.
(a) Each Global Capital Security issued under this Agreement shall be
registered in the name of the Clearing Agency or a nominee thereof and delivered
to such Clearing Agency or a nominee thereof or custodian therefor, and each
such Global Capital Security shall constitute a single Capital Securities
Certificate for all purposes of this Agreement.
(b) Notwithstanding any other provision in this Trust Agreement, no Global
Capital Security may be exchanged in whole or in part for Capital Securities
Certificates registered, and no transfer of a Global Capital Security in whole
or in part may be registered, in the name of any Person other than the Clearing
Agency for such Global Capital Security or a nominee thereof unless (i) the
Clearing Agency advises the Property Trustee in writing that the Clearing Agency
is
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no longer willing or able to properly discharge its responsibilities with
respect to the Global Capital Security, and the Property Trustee is unable to
locate a qualified successor, (ii) the Issuer Trust at its option advises the
Depositary in writing that it elects to terminate the book-entry system through
the Clearing Agency, or (iii) a Debenture Event of Default has occurred and is
continuing. Upon the occurrence of any event specified in clause (i), (ii) or
(iii) above, the Administrators shall notify the Clearing Agency and instruct
the Clearing Agency to notify all Owners of Book-Entry Capital Securities, the
Delaware Trustee and the Administrators of the occurrence of such event and of
the availability of the Definitive Capital Securities Certificates to Owners of
the Capital Securities requesting the same.
(c) If any Global Capital Security is to be exchanged for other Capital
Securities Certificates or canceled in part, or if any other Capital Securities
Certificate is to be exchanged in whole or in part for Book-Entry Capital
Securities represented by a Global Capital Security, then either (i) such Global
Capital Security shall be so surrendered for exchange or cancellation as
provided in this Article V or (ii) the aggregate Liquidation Amount
represented by such Global Capital Security shall be reduced, subject to Section
5.2, or increased by an amount equal to the Liquidation Amount represented by
that portion of the Global Capital Security to be so exchanged or canceled, or
equal to the Liquidation Amount represented by such other Capital Securities
Certificates to be so exchanged for Book-Entry Capital Securities represented
thereby, as the case may be, by means of an appropriate adjustment made on the
records of the Securities Registrar, whereupon the Property Trustee, in
accordance with the Applicable Procedures, shall instruct the Clearing Agency or
its authorized representative to make a corresponding adjustment to its records.
Upon surrender to the Administrators or the Securities Registrar of the Global
Capital Security or Securities by the Clearing Agency, accompanied by
registration instructions, the Administrators, or any one of them, shall execute
the Definitive Capital Securities Certificates in accordance with the
instructions of the Clearing Agency. None of the Securities Registrar, the
Issuer Trustees or the Administrators shall be liable for any delay in delivery
of such instructions and may conclusively rely on, and shall be fully protected
in relying on, such instructions. Upon the issuance of Definitive Capital
Securities Certificates, the Issuer Trustees and Administrators shall recognize
the Holders of the Definitive Capital Securities Certificates as Holders. The
Definitive Capital Securities Certificates shall be printed, lithographed or
engraved or may be produced in any other manner as is reasonably acceptable to
the Administrators, as evidenced by the execution thereof by the Administrators
or any one of them.
(d) Every Capital Securities Certificate executed and delivered upon
registration or transfer of, or in exchange for or in lieu of, a Global Capital
Security or any portion thereof, whether pursuant to this Article V or Article
IV or otherwise, shall be executed and delivered in the form of, and shall be, a
Global Capital Security, unless such Capital Securities Certificate is
registered in the name of a Person other than the Clearing Agency for such
Global Capital Security or a nominee thereof.
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(e) The Clearing Agency or its nominee, as registered owner of a Global
Capital Security, shall be the Holder of such Global Capital Security for all
purposes under this Agreement and the Global Capital Security, and Owners with
respect to a Global Capital Security shall hold such interests pursuant to the
Applicable Procedures. The Securities Registrar and the Property Trustee shall
be entitled to deal with the Clearing Agency for all purposes of this Trust
Agreement relating to the Global Capital Securities (including the payment of
the Liquidation Amount of and Distributions on the Book-Entry Capital Securities
represented thereby and the giving of instructions or directions by Owners of
Book-Entry Capital Securities represented thereby) as the sole Holder of the
Book-Entry Capital Securities represented thereby and shall have no obligations
to the Owners thereof. None of the Property Trustee nor the Securities Registrar
shall have any liability in respect of any transfers effected by the Clearing
Agency.
The rights of the Owners of the Book-Entry Capital Securities shall be
exercised only through the Clearing Agency and shall be limited to those
established by law, the Applicable Procedures and agreements between such Owners
and the Clearing Agency and/or the Clearing Agency Participants, provided that,
solely for the purpose of determining whether the Holders of the requisite
amount of Capital Securities have voted on any matter provided for in this Trust
Agreement, so long as Definitive Capital Security Certificates have not been
issued, the Issuer Trustees may conclusively rely on, and shall be fully
protected in relying on, any written instrument (including a proxy) delivered to
the Property Trustee by the Clearing Agency setting forth the Owners' votes or
assigning the right to vote on any matter to any other Persons either in whole
or in part. Pursuant to the Certificate Depository Agreement, unless and until
Definitive Capital Securities Certificates are issued pursuant to Section
5.4(b), the initial Clearing Agency will make book-entry transfers among the
Clearing Agency Participants and receive and transmit payments on the Capital
Securities to such Clearing Agency Participants, and none of the Depositor, the
Administrators or the Issuer Trustees shall have any responsibility or
obligation with respect thereto.
Section 5.5. Registration of Transfer and Exchange of Capital Securities
Certificates.
(a) The Property Trustee shall keep or cause to be kept, at its Corporate
Trust Office, a register or registers (the "Securities Register") in which the
registrar and transfer agent with respect to the Trust Securities (the
"Securities Registrar"), subject to such reasonable regulations as it may
prescribe, shall provide for the registration of Capital Securities Certificates
and Common Securities Certificates (subject to Section 5.11 in the case of the
Common Securities Certificates) and registration of transfers and exchanges of
Capital Securities Certificates as herein provided. The Property Trustee is
hereby appointed Securities Registrar for the purpose of registering Capital
Securities Certificates and (subject to Section 5.11) Common Securities
Certificates and transfers and exchanges thereof as provided herein.
Upon surrender for registration of transfer of any Capital Securities
Certificate at the office or agency maintained pursuant to Section 5.9, the
Administrators or any one of them shall
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execute and deliver to the Property Trustee, and the Property Trustee shall
deliver, in the name of the designated transferee or transferees, one or more
new Capital Securities Certificates in authorized denominations of a like
aggregate Liquidation Amount as may be required by this Trust Agreement dated
the date of execution by such Administrator.
The Securities Registrar shall not be required, (i) to issue, register the
transfer of or exchange any Capital Security during a period beginning at the
opening of business 15 days before the day of selection for redemption of such
Capital Securities pursuant to Article IV and ending at the close of business on
the day of mailing of the notice of redemption, or (ii) to register the transfer
of or exchange any Capital Security so selected for redemption in whole or in
part, except, in the case of any such Capital Security to be redeemed in part,
any portion thereof not to be redeemed.
Every Capital Securities Certificate presented or surrendered for
registration of transfer or exchange shall be duly endorsed, or be accompanied
by a written instrument of transfer in form satisfactory to the Securities
Registrar duly executed by the Holder or such Holder's attorney duly authorized
in writing. Each Capital Securities Certificate surrendered for registration of
transfer or exchange shall be canceled and subsequently disposed of by the
Property Trustee in accordance with such Person's customary practice.
No service charge shall be made for any registration of transfer or
exchange of Capital Securities Certificates, but the Issuer Trust may require
payment of a sum sufficient to cover any tax or governmental charge that may be
imposed in connection with any transfer or exchange of Capital Securities
Certificates.
(b) Notwithstanding any other provision of this Agreement, transfers and
exchanges of Capital Securities Certificates and beneficial interests in a
Global Capital Security of the kinds specified in this Section 5.5(b) shall be
made only in accordance with this Section 5.5(b).
(i) Non-Global Capital Security to Global Capital Security. If the
------------------------------------------------------
Holder of a Capital Securities Certificate (other than a Global Capital
Security) wishes at any time to transfer all or any portion of such Capital
Securities Certificate to a Person who wishes to take delivery thereof in
the form of a beneficial interest in a Global Capital Security, such
transfer may be effected only in accordance with the provisions of this
clause (b)(i) and subject to the Applicable Procedures. Upon receipt by the
Securities Registrar of (A) such Capital Securities Certificate as provided
in Section 5.5(a) and instructions satisfactory to the Securities Registrar
directing that a beneficial interest in the Global Capital Security of a
specified number of Capital Securities not greater than the number of
Capital Securities represented by such Capital Securities Certificate be
credited to a specified Clearing Agency Participant's account, then the
Securities Registrar shall cancel such Capital Securities Certificate (and
issue a new Capital Securities Certificate in respect of any untransferred
portion thereof) as provided in Section 5.5(a) and increase the aggregate
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Liquidation Amount of the Global Capital Security by the Liquidation Amount
represented by such Capital Securities so transferred as provided in
Section 5.4(c).
(ii) Non-Global Capital Security to Non-Global Capital Security. A
----------------------------------------------------------
Capital Securities Certificate that is not a Global Capital Security may be
transferred, in whole or in part, to a Person who takes delivery in the
form of another Capital Securities Certificate that is not a Global Capital
Security as provided in Section 5.5(a).
(iii) Exchanges between Global Capital Security and Non-Global Capital
----------------------------------------------------------------
Security. A beneficial interest in a Global Capital Security may be
--------
exchanged for a Capital Securities Certificate that is not a Global Capital
Security as provided in Section 5.4.
Section 5.6. Mutilated, Destroyed, Lost or Stolen Securities Certificates.
If (a) any mutilated Securities Certificate shall be surrendered to the
Securities Registrar, or if the Securities Registrar shall receive evidence to
its satisfaction of the destruction, loss or theft of any Securities
Certificate, and (b) there shall be delivered to the Securities Registrar and
the Administrators such security or indemnity as may be required by them to save
each of them harmless, then in the absence of notice that such Securities
Certificate shall have been acquired by a bona fide purchaser, the
Administrators, or any one of them, on behalf of the Issuer Trust shall execute
and make available for delivery, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Securities Certificate, a new Securities
Certificate of like class, tenor and denomination. In connection with the
issuance of any new Securities Certificate under this Section 5.6, the
Administrators or the Securities Registrar 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 Securities Certificate issued pursuant to
this Section 5.6 shall constitute conclusive evidence of an undivided beneficial
interest in the assets of the Issuer Trust corresponding to that evidenced by
the lost, stolen or destroyed Securities Certificate, as if originally issued,
whether or not the lost, stolen or destroyed Securities Certificate shall be
found at any time.
Section 5.7. Persons Deemed Holders.
The Issuer Trustees, the Administrators and the Securities Registrar shall
each treat the Person in whose name any Securities Certificate shall be
registered in the Securities Register as the owner of such Securities
Certificate for the purpose of receiving Distributions and for all other
purposes whatsoever, and none of the Issuer Trustees, the Administrators and the
Securities Registrar shall be bound by any notice to the contrary.
Section 5.8. Access to List of Holders' Names and Addresses.
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Each Holder and each Owner shall be deemed to have agreed not to hold the
Depositor, the Property Trustee, the Delaware Trustee or the Administrators
accountable by reason of the disclosure of its name and address, regardless of
the source from which such information was derived.
Section 5.9. Maintenance of Office or Agency.
The Property Trustee shall designate, with the consent of the
Administrators, which consent shall not be unreasonably withheld, an office or
offices or agency or agencies where Capital Securities Certificates may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Issuer Trustees in respect of the Trust Securities
Certificates may be served. The Property Trustee initially designates the
Corporate Trust Office, Attention: Corporate Trust and Agency Group, as its
office and agency for such purposes. The Property Trustee shall give prompt
written notice to the Depositor, the Administrators and to the Holders of any
change in the location of the Securities Register or any such office or agency.
Section 5.10. Appointment of Paying Agents.
The Paying Agent or Paying Agents shall make Distributions to Holders from
the Payment Account and shall report the amounts of such Distributions to the
Property Trustee and the Administrators. Any Paying Agent shall have the
revocable power to withdraw funds from the Payment Account solely for the
purpose of making the Distributions referred to above. The Property Trustee may
revoke such power and remove the Paying Agent in its sole discretion. The Paying
Agent shall initially be the Property Trustee. Any Person acting as Paying Agent
shall be permitted to resign as Paying Agent upon 30 days' written notice to the
Administrators and the Property Trustee. If the Property Trustee shall no longer
be the Paying Agent or a successor Paying Agent shall resign or its authority to
act be revoked, the Property Trustee shall appoint a successor (which shall be a
bank or trust company) that is reasonably acceptable to the Administrators to
act as Paying Agent. Such successor Paying Agent or any additional Paying Agent
shall execute and deliver to the Issuer Trustees an instrument in which such
successor Paying Agent or additional Paying Agent shall agree with the Issuer
Trustees that as Paying Agent, such successor Paying Agent or additional Paying
Agent will hold all sums, if any, held by it for payment to the Holders in trust
for the benefit of the Holders entitled thereto until such sums shall be paid to
such Holders. The Paying Agent shall return all unclaimed funds to the Property
Trustee and upon removal of a Paying Agent such Paying Agent shall also return
all funds in its possession to the Property Trustee. The provisions of Sections
8.1, 8.3 and 8.6 herein shall apply to the Bank also in its role as Paying
Agent, for so long as the Bank shall act as Paying Agent and, to the extent
applicable, to any other paying agent appointed hereunder. Any reference in this
Agreement to the Paying Agent shall include any co-paying agent unless the
context requires otherwise.
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Section 5.11. Ownership of Common Securities by Depositor.
At the Time of Delivery, the Depositor shall acquire, and thereafter shall
retain, beneficial and record ownership of the Common Securities. Neither the
Depositor nor any successor Holder of the Common Securities may transfer less
than all the Common Securities, and the Depositor or any such successor Holder
may transfer the Common Securities only (i) in connection with a consolidation
or merger of the Depositor into another corporation, or any conveyance, transfer
or lease by the Depositor of its properties and assets substantially as an
entirety to any Person, pursuant to Section 8.1 of the Indenture, or (ii) to the
Depositor or an Affiliate of the Depositor in compliance with applicable law
(including the Securities Act, and applicable state securities and blue sky
laws), and in either case only upon an effective assignment and delegation by
the Holder of all the Common Securities to its transferee of all of its rights
and obligations under the Expense Agreement. To the fullest extent permitted by
law, any attempted transfer of the Common Securities other than as set forth in
the immediately preceding sentence shall be void. The Administrators shall cause
each Common Securities Certificate issued to the Depositor to contain a legend
stating substantially "THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT TO THE
DEPOSITOR OR AN AFFILIATE OF THE DEPOSITOR IN COMPLIANCE WITH APPLICABLE LAW AND
SECTION 5.11 OF THE TRUST AGREEMENT AND ONLY IN CONNECTION WITH A SIMULTANEOUS
DELEGATION AND ASSIGNMENT OF THE EXPENSE AGREEMENT REFERRED TO THEREIN."
Section 5.12. Notices to Clearing Agency.
To the extent that a notice or other communication to the Holders is
required under this Trust Agreement, for so long as Capital Securities are
represented by a Global Capital Security, the Administrators and the Issuer
Trustee shall give all such notices and communications specified herein to be
given to the Clearing Agency, and shall have no obligations to the Owners.
Section 5.13. Rights of Holders; Waivers of Past Defaults.
(a) The legal title to the Trust Property is vested exclusively in the
Property Trustee (in its capacity as such) in accordance with Section 2.9, and
the Holders shall not have any right or title therein other than the undivided
beneficial interest in the assets of the Issuer Trust conferred by their Trust
Securities and they shall have no right to call for any partition or division of
property, profits or rights of the Issuer Trust except as described below. The
Trust Securities shall be personal property giving only the rights specifically
set forth therein and in this Trust Agreement. The Trust Securities shall have
no preemptive or similar rights and when issued and delivered to Holders against
payment of the purchase price therefor will be fully paid and nonassessable by
the Issuer Trust. Subject to the provisions of Section 4.8, the Holders of the
Trust Securities, in their capacities as such, 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.
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(b) For so long as any Capital Securities remain Outstanding, if, upon a
Debenture Event of Default, the Debenture Trustee fails or the holders of not
less than 25% in principal amount of the outstanding Debentures fail to declare
the principal of all of the Debentures to be immediately due and payable, the
Holders of at least 25% in Liquidation Amount of the Capital Securities then
Outstanding shall have the right to make such declaration by a notice in writing
to the Property Trustee, the Depositor and the Debenture Trustee.
At any time after a declaration of acceleration with respect to the
Debentures has been made and before a judgment or decree for payment of the
money due has been obtained by the Debenture Trustee as provided in the
Indenture, if the Property Trustee fails to annul any such declaration and waive
such default, the Holders of at least a Majority in Liquidation Amount of the
Capital Securities, by written notice to the Property Trustee, the Depositor and
the Debenture Trustee, may rescind and annul such declaration and its
consequences if:
(i) the Depositor has paid or deposited with the Debenture Trustee a
sum sufficient to pay
(A) all overdue installments of interest on all of the
Debentures,
(B) any accrued Additional Interest on all of the Debentures,
(C) the principal of (and premium, if any, on) any Debentures
that have become due otherwise than by such declaration of
acceleration and interest and Additional Interest thereon at the rate
borne by the Debentures, and
(D) all sums paid or advanced by the Debenture Trustee under the
Indenture and the reasonable compensation, expenses, disbursements and
advances of the Debenture Trustee and the Property Trustee, their
agents and counsel; and
(ii) all Events of Default with respect to the Debentures, other than
the non-payment of the principal of the Debentures that has become due
solely by such acceleration, have been cured or waived as provided in
Section 5.13 of the Indenture.
The Holders of at least a Majority in Liquidation Amount of the Capital
Securities may, on behalf of the Holders of all the Capital Securities, waive
any past default or Event of Default under the Indenture, except a default or
Event of Default in the payment of principal or interest (unless such default or
Event of 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 Debenture Trustee) or a default or Event of Default in
respect of a covenant or provision that under the Indenture cannot be modified
or amended without the consent of the holder of each outstanding Debenture. No
such rescission shall affect any subsequent default or impair any right
consequent thereon.
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Upon receipt by the Property Trustee of written notice declaring such an
acceleration, or rescission and annulment thereof, by Holders of any part of the
Capital Securities a record date shall be established for determining Holders of
Outstanding Capital Securities entitled to join in such notice, which record
date shall be at the close of business on the day the Property Trustee receives
such notice. The Holders on such record date, or their duly designated proxies,
and only such Persons, shall be entitled to join in such notice, whether or not
such Holders remain Holders after such record date; provided, that, unless such
declaration of acceleration, or rescission and annulment, as the case may be,
shall have become effective by virtue of the requisite percentage having joined
in such notice prior to the day that is 90 days after such record date, such
notice of declaration of acceleration, or rescission and annulment, as the case
may be, shall automatically and without further action by any Holder be canceled
and of no further effect. Nothing in this paragraph shall prevent a Holder, or a
proxy of a Holder, from giving, after expiration of such 90-day period, a new
written notice of declaration of acceleration, or rescission and annulment
thereof, as the case may be, that is identical to a written notice that has been
canceled pursuant to the proviso to the preceding sentence, in which event a new
record date shall be established pursuant to the provisions of this Section
5.13(b).
(c) For so long as any Capital Securities remain Outstanding, to the
fullest extent permitted by law and subject to the terms of this Trust Agreement
and the Indenture, upon a Debenture Event of Default specified in Section 5.1(1)
or 5.1(2) of the Indenture, any Holder of Capital Securities shall have the
right to institute a proceeding directly against the Depositor, pursuant to
Section 5.8 of the Indenture, for enforcement of payment to such Holder of any
amounts payable in respect of Debentures having an aggregate principal amount
equal to the aggregate Liquidation Amount of the Capital Securities of such
Holder (a "Direct Action"). Except as set forth in Section 5.13(b) and this
Section 5.13(c), the Holders of Capital Securities shall have no right to
exercise directly any right or remedy available to the holders of, or in respect
of, the Debentures.
(d) Except as otherwise provided in paragraphs (a), (b) and (c) of this
Section 5.13, the Holders of at least a Majority in Liquidation Amount of the
Capital Securities may, on behalf of the Holders of all the Capital Securities,
waive any past default or Event of Default and its consequences. Upon such
waiver, any such default or Event of Default shall cease to exist, and any
default or Event of Default arising therefrom shall be deemed to have been
cured, for every purpose of this Trust Agreement, but no such waiver shall
extend to any subsequent or other default or Event of Default or impair any
right consequent thereon.
ARTICLE VI.
Acts of Holders; Meetings; Voting
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Section 6.1. Limitations on Voting Rights.
(a) Except as expressly provided in this Trust Agreement and in the
Indenture and as otherwise required by law, no Holder of Capital Securities
shall have any right to vote or in any manner otherwise control the
administration, operation and management of the Issuer Trust or the obligations
of the parties hereto, nor shall anything herein set forth, or contained in the
terms of the Securities Certificates, be construed so as to constitute the
Holders from time to time as partners or members of an association.
(b) So long as any Debentures are held by the Property Trustee on behalf
of the Issuer Trust, the Property Trustee shall not (i) direct the time, method
and place of conducting any proceeding for any remedy available to the Debenture
Trustee, or execute any trust or power conferred on the Property Trustee with
respect to the Debentures, (ii) waive any past default that may be waived under
Section 5.13 of the Indenture, (iii) exercise any right to rescind or annul a
declaration that the principal of all the Debentures shall be due and payable,
or (iv) consent to any amendment, modification or termination of the Indenture
or the Debentures, where such consent shall be required, without, in each case,
obtaining the prior approval of the Holders of at least a Majority in
Liquidation Amount of the Capital Securities, provided, however, that where a
consent under the Indenture would require the consent of each Holder of
Debentures affected thereby, no such consent shall be given by the Property
Trustee without the prior written consent of each Holder of Capital Securities.
The Property Trustee shall not revoke any action previously authorized or
approved by a vote of the Holders of the Capital Securities, except by a
subsequent vote of the Holders of the Capital Securities. The Property Trustee
shall notify all Holders of the Capital Securities of any notice of default
received with respect to the Debentures. In addition to obtaining the foregoing
approvals of the Holders of the Capital Securities, prior to taking any of the
foregoing actions, the Issuer Trustees shall, at the expense of the Depositor,
obtain an Opinion of Counsel experienced in such matters to the effect that such
action shall not cause the Issuer Trust to be taxable as a corporation or
classified as other than a grantor trust for United States federal income tax
purposes.
(c) If any proposed amendment to the Trust Agreement provides for, or the
Issuer Trustees otherwise propose to effect, (i) any action that would adversely
affect in any material respect the powers, preferences or special rights of the
Capital Securities, whether by way of amendment to the Trust Agreement or
otherwise, or (ii) the dissolution, winding-up or termination of the Issuer
Trust, other than pursuant to the terms of this Trust Agreement, then the
Holders of Outstanding Capital Securities as a 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 the Holders of at least a Majority in Liquidation
Amount of the Capital Securities. Notwithstanding any other provision of this
Trust Agreement, no amendment to this Trust Agreement may be made if, as a
result of such amendment, it would cause the Issuer Trust to be taxable as a
corporation or classified as other than a grantor trust for United States
federal income tax purposes.
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Section 6.2. Notice of Meetings.
Notice of all meetings of the Holders of the Capital Securities, stating
the time, place and purpose of the meeting, shall be given by the Property
Trustee pursuant to Section 10.8 to each Holder of Capital Securities, at such
Holder's registered address, at least 15 days and not more than 90 days before
the meeting. At any such meeting, any business properly before the meeting may
be so considered whether or not stated in the notice of the meeting. Any
adjourned meeting may be held as adjourned without further notice.
Section 6.3. Meetings of Holders of the Capital Securities.
No annual meeting of Holders is required to be held. The Property Trustee,
however, shall call a meeting of the Holders of the Capital Securities to vote
on any matter upon the written request of the Holders of at least 25% in
aggregate Liquidation Amount of the Outstanding Capital Securities and the
Administrators or the Property Trustee may, at any time in their discretion,
call a meeting of the Holders of the Capital Securities to vote on any matters
as to which such Holders are entitled to vote.
The Holders of at least a Majority in Liquidation Amount of the Capital
Securities, present in person or by proxy, shall constitute a quorum at any
meeting of the Holders of the Capital Securities.
If a quorum is present at a meeting, an affirmative vote by the Holders
present, in person or by proxy, holding Capital Securities representing at least
a majority of the aggregate Liquidation Amount of the Capital Securities held by
the Holders present, either in person or by proxy, at such meeting shall
constitute the action of the Holders of the Capital Securities, unless this
Trust Agreement requires a greater number of affirmative votes.
Section 6.4. Voting Rights.
Holders shall be entitled to one vote for each [$25] [$1,000] of
Liquidation Amount represented by their Outstanding Trust Securities in respect
of any matter as to which such Holders are entitled to vote.
Section 6.5. Proxies, etc.
At any meeting of Holders, any Holder entitled to vote thereat may vote by
proxy, provided that no proxy shall be voted at any meeting unless it shall have
been placed on file with the Property Trustee, or with such other officer or
agent of the Issuer Trust as the Property Trustee may direct, for verification
prior to the time at which such vote shall be taken. Pursuant to a resolution of
the Property Trustee, proxies may be solicited in the name of the Property
Trustee
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or one or more officers of the Property Trustee. Only Holders of record shall be
entitled to vote. When Trust Securities are held jointly by several persons, any
one of them may vote at any meeting in person or by proxy in respect of such
Trust Securities, but if more than one of them shall be present at such meeting
in person or by proxy, and such joint owners or their proxies so present
disagree as to any vote to be cast, such vote shall not be received in respect
of such Trust Securities. A proxy purporting to be executed by or on behalf of a
Holder shall be deemed valid unless challenged at or prior to its exercise, and
the burden of proving invalidity shall rest on the challenger. No proxy shall be
valid more than three years after its date of execution.
Section 6.6. Holder Action by Written Consent.
Any action that may be taken by Holders at a meeting may be taken without a
meeting if Holders holding at least a Majority in Liquidation Amount of all
Capital Securities entitled to vote in respect of such action (or such larger
proportion thereof as shall be required by any other provision of this Trust
Agreement) shall consent to the action in writing. Any action that may be taken
by the Holders of all the Common Securities may be taken if such Holders shall
consent to the action in writing.
Section 6.7. Record Date for Voting and Other Purposes.
For the purposes of determining the Holders who are entitled to notice of
and to vote at any meeting or by written consent, or to participate in any
distribution on the Trust Securities in respect of which a record date is not
otherwise provided for in this Trust Agreement, or for the purpose of any other
action, the Administrators or Property Trustee may from time to time fix a date,
not more than 90 days prior to the date of any meeting of Holders or the payment
of a distribution or other action, as the case may be, as a record date for the
determination of the identity of the Holders of record for such purposes.
Section 6.8. Acts of Holders.
Any request, demand, authorization, direction, notice, consent, waiver or
other action provided or permitted by this Trust Agreement to be given, made 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 otherwise expressly provided herein, such
action shall become effective when such instrument or instruments are delivered
to the Property Trustee. 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 Trust Agreement and (subject to Section 8.1) conclusive
in favor of the Issuer Trustees and the Administrators, if made in the manner
provided in this Section.
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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 such signer's individual capacity, such
certificate or affidavit shall also constitute sufficient proof of such signer's
authority. The fact and date of the execution of any such instrument or writing,
or the authority of the Person executing the same, may also be proved in any
other manner that any Issuer Trustee or Administrator receiving the same deems
sufficient.
The ownership of Trust Securities shall be proved by the Securities
Register.
Any request, demand, authorization, direction, notice, consent, waiver or
other Act of the Holder of any Trust Security shall bind every future Holder of
the same Trust Security and the Holder of every Trust 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 Issuer Trustees,
the Administrators or the Issuer Trust in reliance thereon, whether or not
notation of such action is made upon such Trust Security.
Without limiting the foregoing, a Holder entitled hereunder to take any
action hereunder with regard to any particular Trust Security may do so with
regard to all or any part of the Liquidation Amount of such Trust Security or by
one or more duly appointed agents each of which may do so pursuant to such
appointment with regard to all or any part of such Liquidation Amount.
If any dispute shall arise among the Holders, the Administrators or the
Issuer Trustees with respect to the authenticity, validity or binding nature of
any request, demand, authorization, direction, consent, waiver or other Act of
such Holder or Issuer Trustee under this Article VI, then the determination of
such matter by the Property Trustee shall be conclusive with respect to such
matter.
Section 6.9. Inspection of Records.
Upon reasonable written notice to the Administrators and the Property
Trustee, the records of the Issuer Trust shall be open to inspection by any
Holder during normal business hours for any purpose reasonably related to such
Holder's interest as a Holder.
ARTICLE VII.
Representations and Warranties
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Section 7.1. Representations and Warranties of the Property Trustee and
the Delaware Trustee.
The Property Trustee and the Delaware Trustee, each severally on behalf of
and as to itself, hereby represents and warrants for the benefit of the
Depositor and the Holders that:
(a) the Property Trustee is a New York banking corporation, duly
organized, validly existing and in good standing under the laws of the
State of New York;
(b) the Property Trustee has full corporate power, authority and
legal right to execute, deliver and perform its obligations under this
Trust Agreement and has taken all necessary action to authorize the
execution, delivery and performance by it of this Trust Agreement;
(c) the Delaware Trustee is a Delaware banking corporation;
(d) the Delaware Trustee has full corporate power, authority and
legal right to execute, deliver and perform its obligations under this
Trust Agreement and has taken all necessary action to authorize the
execution, delivery and performance by it of this Trust Agreement;
(e) this Trust Agreement has been duly authorized, executed and
delivered by the Property Trustee and the Delaware Trustee and constitutes
the valid and legally binding agreement of each of the Property Trustee and
the Delaware Trustee enforceable against each of them in accordance with
its terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity
principles;
(f) the execution, delivery and performance of this Trust Agreement
has been duly authorized by all necessary corporate or other action on the
part of the Property Trustee and the Delaware Trustee and does not require
any approval of stockholders of the Property Trustee and the Delaware
Trustee and such execution, delivery and performance will not (i) violate
the Charter or By-laws of the Property Trustee or the Delaware Trustee,
(ii) violate any provision of, or constitute, with or without notice or
lapse of time, a default under, or result in the creation or imposition of,
any Lien on any properties included in the Trust Property pursuant to the
provisions of, any indenture, mortgage, credit agreement, license or other
agreement or instrument to which the Property Trustee or the Delaware
Trustee is a party or by which it is bound, or (iii) violate any law,
governmental rule or regulation of the United States or the State of
Delaware, as the case may be, governing the banking, trust or general
powers of the Property Trustee or the Delaware Trustee (as appropriate in
context) or any order, judgment or decree applicable to the Property
Trustee or the Delaware Trustee;
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(g) neither the authorization, execution or delivery by the Property
Trustee or the Delaware Trustee of this Trust Agreement nor the
consummation of any of the transactions by the Property Trustee or the
Delaware Trustee (as appropriate in context) contemplated herein requires
the consent or approval of, the giving of notice to, the registration with
or the taking of any other action with respect to any governmental
authority or agency under any existing law of the United States or the
State of Delaware governing the banking, trust or general powers of the
Property Trustee or the Delaware Trustee, as the case may be; and
(h) there are no proceedings pending or, to the best of each of the
Property Trustee's and the Delaware Trustee's knowledge, threatened against
or affecting the Property Trustee or the Delaware Trustee in any court or
before any governmental authority, agency or arbitration board or tribunal
that, individually or in the aggregate, would materially and adversely
affect the Issuer Trust or would question the right, power and authority of
the Property Trustee or the Delaware Trustee, as the case may be, to enter
into or perform its obligations as one of the Trustees under this Trust
Agreement.
Section 7.2. Representations and Warranties of Depositor.
The Depositor hereby represents and warrants for the benefit of the Holders
that:
(a) the Securities Certificates issued at the Time of Delivery on
behalf of the Issuer Trust have been duly authorized and will have been
duly and validly executed, issued and delivered by the Issuer Trustees
pursuant to the terms and provisions of, and in accordance with the
requirements of, this Trust Agreement and the Holders will be, as of each
such date, entitled to the benefits of this Trust Agreement; and
(b) there are no taxes, fees or other governmental charges payable by
the Issuer Trust (or the Issuer Trustees on behalf of the Issuer Trust)
under the laws of the State of Delaware or any political subdivision
thereof in connection with the execution, delivery and performance by
either Issuer Trustee of this Trust Agreement.
ARTICLE VIII.
The Issuer Trustees; The Administrators
Section 8.1. Certain Duties and Responsibilities.
(a) The duties and responsibilities of the Issuer Trustees and the
Administrators shall be as provided by this Trust Agreement and, in the case of
the Property Trustee, by the Trust
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Indenture Act. Notwithstanding the foregoing, but subject to Section 8.1(c), no
provision of this Trust Agreement shall require any of the Issuer Trustees or
Administrators to expend or risk its or their own funds or otherwise incur any
financial liability in the performance of any of its or their duties hereunder,
or in the exercise of any of its or their rights or powers, if it or they shall
have reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it.
Whether or not therein expressly so provided, every provision of this Trust
Agreement relating to the conduct or affecting the liability of or affording
protection to the Issuer Trustees or the Administrators shall be subject to the
provisions of this Section 8.1. Nothing in this Trust Agreement shall be
construed to release an Administrator from liability for his or her own
negligent action, its own negligent failure to act, or his or her own wilful
misconduct. To the extent that, at law or in equity, an Issuer Trustee or
Administrator has duties and liabilities relating to the Issuer Trust or to the
Holders, such Issuer Trustee or Administrator shall not be liable to the Issuer
Trust or to any Holder for such Issuer Trustee's or Administrator's good faith
reliance on the provisions of this Trust Agreement. The provisions of this Trust
Agreement, to the extent that they restrict the duties and liabilities of the
Issuer Trustees and Administrators otherwise existing at law or in equity, are
agreed by the Depositor and the Holders to replace such other duties and
liabilities of the Issuer Trustees and Administrators.
(b) All payments made by the Property Trustee or a Paying Agent in respect
of the Trust Securities shall be made only from the revenue and proceeds from
the Trust Property and only to the extent that there shall be sufficient revenue
or proceeds from the Trust Property to enable the Property Trustee or a Paying
Agent to make payments in accordance with the terms hereof. Each Holder, by its
acceptance of a Trust Security, agrees that it will look solely to the revenue
and proceeds from the Trust Property to the extent legally available for
distribution to it as herein provided and that neither the Issuer Trustees nor
the Administrators are personally liable to it for any amount distributable in
respect of any Trust Security or for any other liability in respect of any Trust
Security. This Section 8.1(b) does not limit the liability of the Issuer
Trustees expressly set forth elsewhere in this Trust Agreement or, in the case
of the Property Trustee, in the Trust Indenture Act.
(c) If an Event of Default has occurred and is continuing, the Property
Trustee shall enforce this Trust Agreement for the benefit of the Holders.
(d) The Property Trustee, before the occurrence of any Event of Default
and after the curing of all Events of Default that may have occurred, shall
undertake to perform only such duties as are specifically set forth in this
Trust Agreement (including pursuant to Section 10.10), and no implied covenants
shall be read into this Trust Agreement against the Property Trustee. If an
Event of Default has occurred (that has not been cured or waived pursuant to
Section 5.13), the Property Trustee shall exercise such of the rights and powers
vested in it by this Trust Agreement 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.
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(e) No provision of this Trust Agreement shall be construed to relieve the
Property Trustee or the Delaware Trustee from liability for its own negligent
action, its own negligent failure to act, or its own wilful misconduct, except
that:
(i) prior to the occurrence of any Event of Default and after the
curing or waiving of all such Events of Default that may have occurred:
(A) the duties and obligations of the Property Trustee shall be
determined solely by the express provisions of this Trust Agreement
(including pursuant to Section 10.10), and the Property Trustee shall
not be liable except for the performance of such duties and
obligations as are specifically set forth in this Trust Agreement
(including pursuant to Section 10.10); 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 Trust Agreement;
but in the case of any such certificates or opinions that by any
provision hereof or of the Trust Indenture Act are specifically
required to be furnished to the Property Trustee, the Property Trustee
shall be under a duty to examine the same to determine whether or not
they conform to the requirements of this Trust Agreement.
(ii) the Property Trustee shall not be liable for any error of
judgment made in good faith by an authorized officer of the Property
Trustee, unless it shall be proved that the Property Trustee was negligent
in ascertaining the pertinent facts;
(iii) the Property Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in good faith in accordance with
the direction of the Holders of at least a Majority in Liquidation Amount
of the Capital Securities relating to the time, method and place of
conducting any proceeding for any remedy available to the Property Trustee,
or exercising any trust or power conferred upon the Property Trustee under
this Trust Agreement;
(iv) the Property Trustee's sole duty with respect to the custody,
safe keeping and physical preservation of the Debentures and the Payment
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 Trust Agreement and the Trust Indenture Act;
(v) the Property Trustee shall not be liable for any interest on any
money received by it except as it may otherwise agree with the Depositor;
and money held by the
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Property Trustee need not be segregated from other funds held by it except
in relation to the Payment Account maintained by the Property Trustee
pursuant to Section 3.1 and except to the extent otherwise required by law;
(vi) the Property Trustee shall not be responsible for monitoring the
compliance by the Administrators or the Depositor with their respective
duties under this Trust Agreement, nor shall the Property Trustee be liable
for the default or misconduct of any other Issuer Trustee, the
Administrators or the Depositor; and
(vii) Subject to Section 8.1(c), no provision of this Trust Agreement
shall require the Property Trustee to expend or risk its own funds or
otherwise incur personal financial liability in the performance of any of
its duties or in the exercise of any of its rights or powers, if the
Property 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 Trust Agreement or adequate indemnity against such risk
or liability is not reasonably assured to it.
(f) The Administrators shall not be responsible for monitoring the
compliance by the Issuer Trustees or the Depositor with their respective duties
under this Trust Agreement, nor shall either Administrator be liable for the
default or misconduct of any other Administrator, the Issuer Trustees or the
Depositor.
Section 8.2. Certain Notices.
Within five Business Days after the occurrence of any Event of Default
actually known to a Responsible Officer of the Property Trustee, the Property
Trustee shall transmit, in the manner and to the extent provided in Section
10.8, notice of such Event of Default to the Holders and the Administrators,
unless such Event of Default shall have been cured or waived.
Within five Business Days after the receipt of notice of the Depositor's
exercise of its right to defer the payment of interest on the Debentures
pursuant to the Indenture, the Property Trustee shall transmit, in the manner
and to the extent provided in Section 10.8, notice of such exercise to the
Holders and the Administrators, unless such exercise shall have been revoked.
The Property Trustee shall not be deemed to have knowledge of any Event of
Default unless the Property Trustee shall have received written notice or a
Responsible Officer of the Property Trustee charged with the administration of
this Trust Agreement shall have obtained actual knowledge of such Event of
Default.
Section 8.3. Certain Rights of Property Trustee.
Subject to the provisions of Section 8.1:
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(a) the Property Trustee may conclusively rely and shall be fully
protected in acting or refraining from acting in good faith upon any
resolution, Opinion of Counsel, certificate, written representation of a
Holder or transferee, certificate of auditors or any other certificate,
statement, instrument, opinion, report, notice, request, consent, order,
appraisal, 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) if (i) in performing its duties under this Trust Agreement the
Property Trustee is required to decide between alternative courses of
action, (ii) in construing any of the provisions of this Trust Agreement
the Property Trustee finds the same ambiguous or inconsistent with any
other provisions contained herein, or (iii) the Property Trustee is unsure
of the application of any provision of this Trust Agreement, then, except
as to any matter as to which the Holders of the Capital Securities are
entitled to vote under the terms of this Trust Agreement, the Property
Trustee shall deliver a notice to the Depositor requesting the Depositor's
opinion as to the course of action to be taken and the Property Trustee
shall take such action, or refrain from taking such action, as the Property
Trustee shall deem advisable and in the best interests of the Holders, in
which event the Property Trustee shall have no liability except for its own
bad faith, negligence or wilful misconduct;
(c) any direction or act of the Depositor contemplated by this Trust
Agreement shall be sufficiently evidenced by an Officers' Certificate;
(d) any direction or act of an Administrator contemplated by this
Trust Agreement shall be sufficiently evidenced by a certificate executed
by such Administrator and setting forth such direction or act;
(e) 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 re-registration thereof;
(f) the Property Trustee may consult with counsel (which counsel may
be counsel to the Depositor or any of its Affiliates, and may include any
of its employees) and the advice of such counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon and in
accordance with such advice; the Property Trustee shall have the right at
any time to seek instructions concerning the administration of this Trust
Agreement from any court of competent jurisdiction;
(g) the Property Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Trust Agreement at the request
or direction of any of the Holders pursuant to this Trust Agreement, unless
such Holders shall have offered to
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the Property Trustee reasonable security or indemnity against the costs,
expenses and liabilities that might be incurred by it in compliance with
such request or direction; provided that, nothing contained in this Section
8.3(g) shall be taken to relieve the Property Trustee, upon the occurrence
of an Event of Default, of its obligation to exercise the rights and powers
vested in it by this Trust Agreement;
(h) 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, consent, order, approval,
bond, debenture, note or other evidence of indebtedness or other paper or
document, unless requested in writing to do so by one or more Holders, but
the Property Trustee may make such further inquiry or investigation into
such facts or matters as it may see fit;
(i) the Property Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
its agents, attorneys, custodians or nominees, provided that the Property
Trustee shall be responsible for its own negligence, bad faith or wilful
misconduct with respect to selection of any agent, attorney, custodian or
nominee appointed by it hereunder;
(j) whenever in the administration of this Trust Agreement 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 (which instructions may only be given by the Holders of the same
proportion in Liquidation Amount of the Trust Securities as would be
entitled to direct the Property Trustee under the terms of the Trust
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 fully protected in acting in
accordance with such instructions;
(k) except as otherwise expressly provided by this Trust Agreement,
the Property Trustee shall not be under any obligation to take any action
that is discretionary under the provisions of this Trust Agreement; and
(l) when the Property Trustee incurs expenses or renders services in
connection with a Bankruptcy Event, such expenses (including legal fees and
expenses of its counsel) and the compensation for such services are
intended to constitute expenses of administration under any bankruptcy law
or law relating to creditors rights generally.
No provision of this Trust Agreement shall be deemed to impose any duty or
obligation on any Issuer Trustee or Administrator 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 such Person 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 any Issuer Trustee or Administrator
shall be construed to be a duty.
Section 8.4. Not Responsible for Recitals or Issuance of Securities.
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The recitals contained herein and in the Securities Certificates shall be
taken as the statements of the Issuer Trust, and the Issuer Trustees and the
Administrators do not assume any responsibility for their correctness. The
Issuer Trustees and the Administrators shall not be accountable for the use or
application by the Depositor of the proceeds of the Debentures.
Section 8.5. May Hold Securities.
The Administrators, any Issuer Trustee or any other agent of any Issuer
Trustee or the Issuer Trust, in its individual or any other capacity, may become
the owner or pledgee of Trust Securities and, subject to Sections 8.8 and 8.13,
and except as provided in the definition of the term "Outstanding" in Article I,
may otherwise deal with the Issuer Trust with the same rights it would have if
it were not an Administrator, Issuer Trustee or such other agent.
Section 8.6. Compensation; Indemnity; Fees.
The Depositor agrees:
(a) to pay to each Issuer Trustee and Paying Agent from time to time
such reasonable compensation for all services rendered by them hereunder as
may be agreed by the Depositor and such Issuer Trustee or Paying Agent, as
the case may be, from time to time (which compensation shall not be limited
by any provision of law in regard to the compensation of a trustee of an
express trust);
(b) except as otherwise expressly provided herein, to reimburse each
Issuer Trustee upon request for all reasonable expenses, disbursements and
advances incurred or made by each Issuer Trustee and Paying Agent in
accordance with any provision of this Trust Agreement (including the
reasonable compensation and the expenses and disbursements of their agents
and counsel), except any such expense, disbursement or advance as may be
attributable to their negligence, bad faith or wilful misconduct; and
(c) to the fullest extent permitted by applicable law, to indemnify
and hold harmless (i) each Issuer Trustee, (ii) each Administrator, (iii)
each Paying Agent, (iv) any Affiliate of any Issuer Trustee, (v) any
officer, director, shareholder, employee, representative or agent of any
Issuer Trustee, and (vi) any employee or agent of the Issuer Trust
(referred to herein as an "Indemnified Person") from and against any loss,
damage, liability, tax (other than income, franchise or other taxes
imposed on amounts paid pursuant to (a) or (b) hereof) penalty, expense or
claim of any kind or nature whatsoever incurred by such Indemnified Person
by reason of the creation, operation or termination of the Issuer Trust or
any act or omission performed or omitted by such Indemnified Person in good
faith on behalf of the Issuer Trust and in a manner such Indemnified Person
reasonably believed to be within the scope of authority conferred on such
Indemnified Person by this Trust Agreement, except that no Indemnified
Person shall be entitled to be indemnified in respect of any loss, damage
or claim incurred by such Indemnified Person by reason of negligence, bad
faith or wilful misconduct with respect to such acts or omissions.
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The provisions of this Section 8.6 shall survive the termination of this
Trust Agreement and the removal or resignation of any Issuer Trustee.
No Issuer Trustee or Paying Agent may claim any Lien on any Trust Property
as a result of any amount due pursuant to this Section 8.6.
The Depositor, any Administrator, any Issuer Trustee and any Paying Agent
may engage in or possess an interest in other business ventures of any nature or
description, independently or with others, similar or dissimilar to the business
of the Issuer Trust, and the Issuer Trust and the Holders of Trust Securities
shall have no rights by virtue of this Trust Agreement in and to such
independent ventures or the income or profits derived therefrom, and the pursuit
of any such venture, even if competitive with the business of the Issuer Trust,
shall not be deemed wrongful or improper. Neither the Depositor, any
Administrator, any Paying Agent nor any Issuer Trustee shall be obligated to
present any particular investment or other opportunity to the Issuer Trust even
if such opportunity is of a character that, if presented to the Issuer Trust,
could be taken by the Issuer Trust, and the Depositor, any Administrator, any
Issuer Trustee or any Paying Agent 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 Issuer Trustee or
Paying Agent may engage or be interested in any financial or other transaction
with the Depositor or any Affiliate of the Depositor, or may act as depository
for, trustee or agent for, or act on any committee or body of holders of,
securities or other obligations of the Depositor or its Affiliates.
In the event that the Property Trustee is also acting as Paying Agent or
Securities Registrar hereunder, the rights and protections afforded to the
Property Trustee pursuant to this Article VIII shall also be afforded to such
Paying Agent or Securities Registrar.
Section 8.7. Corporate Property Trustee Required; Eligibility of Issuer
Trustees and Administrators.
(a) There shall at all times be a Property Trustee hereunder with respect
to the Trust Securities. The Property Trustee shall be a Person that is a
national or state chartered bank and eligible pursuant to the Trust Indenture
Act to act as such, and that has at the time of such appointment a combined
capital and surplus of at least $50,000,000. If any such Person publishes
reports of condition at least annually, pursuant to law or to the requirements
of its supervising or examining authority, then for the purposes of this Section
8.7 and to the extent permitted by the Trust Indenture Act, 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 Property Trustee with respect to the Trust Securities shall cease
to be eligible in accordance with the provisions of this Section 8.7, it shall
resign immediately in the manner and with the effect hereinafter specified in
this Article. At the time of appointment, the Property Trustee must have
securities rated in one of the three highest rating categories by a nationally
recognized statistical rating organization.
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(b) There shall at all times be one or more Administrators hereunder with
respect to the Trust Securities. Each Administrator 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 persons authorized to bind that entity.
(c) There shall at all times be a Delaware Trustee with respect to the
Trust Securities. The Delaware Trustee shall either be (i) a natural person who
is at least 21 years of age and a resident of the State of Delaware, or (ii) a
legal entity with its principal place of business in the State of Delaware and
that otherwise meets the requirements of applicable Delaware law and that shall
act through one or more persons authorized to bind such entity.
Section 8.8. Conflicting Interests.
(a) If the Property Trustee has or shall acquire a conflicting interest
within the meaning of the Trust Indenture Act, the Property 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 Trust
Agreement.
(b) The Guarantee Agreement and the Indenture shall be deemed to be
specifically described in this Trust Agreement for the purposes of clause (i) of
the first proviso contained in Section 310(b) of the Trust Indenture Act.
Section 8.9. Co-Trustees and Separate Trustee.
Unless an Event of Default shall have occurred and be continuing, at any
time or times, for the purpose of meeting the legal requirements of the Trust
Indenture Act or of any jurisdiction in which any part of the Trust Property may
at the time be located, the Property Trustee shall have power to appoint, and
upon the written request of the Property Trustee, the Depositor and the
Administrators shall for such purpose join with the Property Trustee in the
execution, delivery, and performance of all instruments and agreements necessary
or proper to appoint, one or more Persons approved by the Property Trustee
either to act as co-trustee, jointly with the Property Trustee, of all or any
part of such Trust Property, or to the extent required by law to act as separate
trustee of any such property, in either case with such powers as may be provided
in the instrument of appointment, and to vest in such Person or Persons in the
capacity aforesaid, any property, title, right or power deemed necessary or
desirable, subject to the other provisions of this Section 8.9. Any co-trustee
or separate trustee appointed pursuant to this Section 8.9 shall either be (i) a
natural person who is at least 21 years of age and a resident of the United
States, or (ii) a legal entity with its principal place of business in the
United States that shall act through one or more persons authorized to bind such
entity.
Should any written instrument from the Depositor be required by any co-
trustee or separate trustee so appointed for more fully confirming to such co-
trustee or separate trustee such
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property, title, right, or power, any and all such instruments shall, on
request, be executed, acknowledged and delivered by the Depositor.
Every co-trustee or separate trustee shall, to the extent permitted by law,
but to such extent only, be appointed subject to the following terms, namely:
(a) The Trust Securities shall be executed by one or more
Administrators, and the Trust Securities shall be delivered by the Property
Trustee, and all rights, powers, duties, and obligations hereunder in
respect of the custody of securities, cash and other personal property held
by, or required to be deposited or pledged with, the Property Trustee
specified hereunder shall be exercised solely by the Property Trustee and
not by such co-trustee or separate trustee.
(b) The rights, powers, duties, and obligations hereby conferred or
imposed upon the Property Trustee in respect of any property covered by
such appointment shall be conferred or imposed upon and exercised or
performed by the Property Trustee or by the Property Trustee and such co-
trustee or separate trustee jointly, as shall be provided in the instrument
appointing such co-trustee or separate trustee, except to the extent that
under any law of any jurisdiction in which any particular act is to be
performed, the Property Trustee shall be incompetent or unqualified to
perform such act, in which event such rights, powers, duties and
obligations shall be exercised and performed by such co-trustee or separate
trustee.
(c) The Property Trustee at any time, by an instrument in writing
executed by it, with the written concurrence of the Depositor, may accept
the resignation of or remove any co-trustee or separate trustee appointed
under this Section 8.9, and, in case a Debenture Event of Default has
occurred and is continuing, the Property Trustee shall have power to accept
the resignation of, or remove, any such co-trustee or separate trustee
without the concurrence of the Depositor. Upon the written request of the
Property Trustee, the Depositor shall join with the Property Trustee in the
execution, delivery and performance of all instruments and agreements
necessary or proper to effectuate such resignation or removal. A successor
to any co-trustee or separate trustee so resigning or removed may be
appointed in the manner provided in this Section 8.9.
(d) No co-trustee or separate trustee hereunder shall be personally
liable by reason of any act or omission of the Property Trustee or any
other trustee hereunder.
(e) The Property Trustee shall not be liable by reason of any act of
a co-trustee or separate trustee.
(f) Any Act of Holders delivered to the Property Trustee shall be
deemed to have been delivered to each such co-trustee and separate trustee.
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Section 8.10. Resignation and Removal; Appointment of Successor.
No resignation or removal of any Issuer Trustee (the "Relevant Trustee")
and no appointment of a successor Issuer Trustee pursuant to this Article shall
become effective until the acceptance of appointment by the successor Issuer
Trustee in accordance with the applicable requirements of Section 8.11.
Subject to the immediately preceding paragraph, the Relevant Trustee may
resign at any time by giving written notice thereof to the Holders and by
appointing a successor Relevant Trustee. The Relevant Trustee shall appoint a
successor by requesting from at least three Persons meeting the eligibility
requirements its expenses and charges to serve as the Relevant Trustee on a form
provided by the Administrators, and selecting the Person who agrees to the
lowest expenses and charges. If the instrument of acceptance by the successor
Issuer Trustee required by Section 8.11 shall not have been delivered to the
Relevant Trustee within 60 days after the giving of such notice of resignation,
the Relevant Trustee may petition, at the expense of the, in the case of the
Property Trustee, Depositor, any court of competent jurisdiction for the
appointment of a successor Relevant Trustee.
The Property Trustee or the Delaware Trustee, or both of them, may be
removed by Act of the Holders of at least a Majority in Liquidation Amount of
the Capital Securities, delivered to the Relevant Trustee (in its individual
capacity and, in the case of the Property Trustee, on behalf of the Issuer
Trust) (i) for cause (including upon the occurrence of an Event of Default
described in subparagraph (d) of the definition thereof with respect to the
Relevant Trustee), or (ii) if a Debenture Event of Default shall have occurred
and be continuing at any time.
If a resigning Issuer Trustee shall fail to appoint a successor, or if an
Issuer Trustee shall be removed or become incapable of acting as Issuer Trustee,
or if a vacancy shall occur in the office of any Issuer Trustee for any cause,
the Holders of the Capital Securities, by Act of the Holders of not less than
25% in aggregate Liquidation Amount of the Capital Securities then Outstanding
delivered to such Relevant Trustee, may appoint a successor Relevant Trustee or
Trustees, and such successor Issuer Trustee shall comply with the applicable
requirements of Section 8.11. If no successor Relevant Trustee shall have been
so appointed by the Holders of the Capital Securities and accepted appointment
in the manner required by Section 8.11, any Holder, on behalf of such Holder and
all others similarly situated, or any other Issuer Trustee, may petition any
court of competent jurisdiction for the appointment of a successor Relevant
Trustee.
The Property Trustee shall give notice of each resignation and each removal
of an Issuer Trustee and each appointment of a successor Issuer Trustee to all
Holders in the manner provided in Section 10.8 and shall give notice to the
Depositor and to the Administrators. Each notice shall include the name of the
successor Relevant Trustee and the address of its Corporate Trust Office if it
is the Property Trustee.
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Notwithstanding the foregoing or any other provision of this Trust
Agreement, if any Delaware Trustee who is a natural person dies or becomes, in
the opinion of the Holders of the Common Securities, incompetent or
incapacitated, the vacancy created by such death, incompetence or incapacity may
be filled by the Property Trustee following the procedures regarding expenses
and charges set forth above (with the successor being a Person who satisfies the
eligibility requirement for the Delaware Trustee set forth in Section 8.7).
Section 8.11. Acceptance of Appointment by Successor.
In case of the appointment hereunder of a successor Relevant Trustee, the
retiring Relevant Trustee and each successor Relevant Trustee with respect to
the Trust Securities shall execute and deliver an amendment hereto wherein each
successor Relevant Trustee shall accept such appointment and which (a) shall
contain such provisions as shall be necessary or desirable to transfer and
confirm to, and to vest in, each successor Relevant Trustee all the rights,
powers, trusts and duties of the retiring Relevant Trustee with respect to the
Trust Securities and the Issuer Trust, and (b) shall add to or change any of the
provisions of this Trust Agreement as shall be necessary to provide for or
facilitate the administration of the Issuer Trust by more than one Relevant
Trustee, it being understood that nothing herein or in such amendment shall
constitute such Relevant Trustees co-trustees and upon the execution and
delivery of such amendment the resignation or removal of the retiring Relevant
Trustee shall become effective to the extent provided therein and each such
successor Relevant Trustee, without any further act, deed or conveyance, shall
become vested with all the rights, powers, trusts and duties of the retiring
Relevant Trustee; but, on request of the Issuer Trust or any successor Relevant
Trustee such retiring Relevant Trustee shall duly assign, transfer and deliver
to such successor Relevant Trustee all Trust Property, all proceeds thereof and
money held by such retiring Relevant Trustee hereunder with respect to the Trust
Securities and the Trust.
Upon request of any such successor Relevant Trustee, the Issuer Trust shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Relevant Trustee all such rights, powers and trusts
referred to in the first or second preceding paragraph, as the case may be.
No successor Relevant Trustee shall accept its appointment unless at the
time of such acceptance such successor Relevant Trustee shall be qualified and
eligible under this Article.
Section 8.12. Merger, Conversion, Consolidation or Succession to
Business.
Any Person into which the Property Trustee or the Delaware Trustee may be
merged or converted or with which it may be consolidated, or any Person
resulting from any merger, conversion or consolidation to which such Relevant
Trustee shall be a party, or any Person, succeeding to all or substantially all
the corporate trust business of such Relevant Trustee, shall be the successor of
such Relevant Trustee hereunder, provided that such Person shall be otherwise
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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.
Section 8.13. Preferential Collection of Claims Against Depositor or
Issuer Trust.
If and when the Property Trustee shall be or become a creditor of the
Depositor or the Issuer Trust (or any other obligor upon the Capital
Securities), the Property Trustee shall be subject to the provisions of the
Trust Indenture Act regarding the collection of claims against the Depositor or
the Issuer Trust (or any such other obligor).
Section 8.14. Property Trustee May File Proofs of Claim.
In case of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other similar judicial
proceeding relative to the Issuer Trust or any other obligor upon the Trust
Securities or the property of the Issuer Trust or of such other obligor or their
creditors, the Property Trustee (irrespective of whether any Distributions on
the Trust Securities shall then be due and payable and irrespective of whether
the Property Trustee shall have made any demand on the Issuer 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 Trust Securities and to
file such other papers or documents as may be necessary or advisable in
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 Trust
Securities or the rights of any Holder thereof or
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to authorize the Property Trustee to vote in respect of the claim of any Holder
in any such proceeding.
Section 8.15. Reports by Property Trustee.
(a) Not later than May 1 of each year commencing with May 1, 1999, the
Property Trustee shall transmit to all Holders in accordance with Section 10.8,
and to the Depositor, a brief report, dated as of the immediately preceding
December 31 with respect to:
(i) its eligibility under Section 8.7 or, in lieu thereof, if to the
best of its knowledge it has continued to be eligible under said Section, a
written statement to such effect;
(ii) a statement that the Property Trustee has complied with all of
its obligations under this Trust Agreement during the twelve-month period
(or, in the case of the initial report, the period since the Closing Date)
ending with such December 31 or, if the Property Trustee has not complied
in any material respect with such obligations, a description of such
noncompliance; and
(iii) any change in the property and funds in its possession as
Property Trustee since the date of its last report and any action taken by
the Property Trustee in the performance of its duties hereunder which it
has not previously reported and which in its opinion materially affects the
Trust Securities.
(b) In addition the Property Trustee shall transmit to Holders such
reports concerning the Property Trustee and its actions under this Trust
Agreement as may be required pursuant to the Trust Indenture Act at the times
and in the manner provided pursuant thereto.
(c) A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Property Trustee with each national stock exchange, the
Nasdaq National Market or such other interdealer quotation system or self-
regulatory organization upon which the Trust Securities are listed or traded, if
any, with the Commission and with the Depositor.
Section 8.16 Reports to the Property Trustee.
Each of the Depositor and the Administrators on behalf of the Issuer 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(a) of the Trust Indenture Act in the form,
in the manner and at the times required by Section 314 of the Trust Indenture
Act. The Depositor and the Administrators shall annually file with the Property
Trustee a certificate specifying whether such Person is in compliance with all
of the terms and covenants applicable to such Person hereunder.
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Section 8.17. Evidence of Compliance with Conditions Precedent.
Each of the Depositor and the Administrators shall provide to the Property
Trustee such evidence of compliance with any conditions precedent, if any,
provided for in this Trust Agreement that relate to any of the matters set forth
in Section 314(c) of the Trust Indenture Act. Any certificate or opinion
required to be given by an officer pursuant to Section 314(c)(1) of the Trust
Indenture Act shall be given in the form of an Officers' Certificate.
Section 8.18. Number of Issuer Trustees.
(a) The number of Issuer Trustees shall be two, provided that the Property
Trustee and the Delaware Trustee may be the same Person.
(b) If an Issuer Trustee ceases to hold office for any reason, a vacancy
shall occur. The vacancy shall be filled with an Issuer Trustee appointed in
accordance with Section 8.10.
(c) The death, resignation, retirement, removal, bankruptcy, incompetence
or incapacity to perform the duties of an Issuer Trustee shall not operate to
annul, dissolve or terminate the Issuer Trust.
Section 8.19. Delegation of Power.
(a) Any Administrator may, by power of attorney consistent with applicable
law, delegate to any other natural person over the age of 21 his or her power
for the purpose of executing any documents contemplated in Section 2.7(a),
including any registration statement or amendment thereto filed with the
Commission, or making any other governmental filing; and
(b) The Administrators shall have power to delegate from time to time to
such of their number the doing of such things and the execution of such
instruments either in the name of the Issuer Trust or the names of the
Administrators or otherwise as the Administrators may deem expedient, to the
extent such delegation is not prohibited by applicable law or contrary to the
provisions of this Trust Agreement.
Section 8.20. Appointment of Administrators.
(a) The Administrators shall initially be _________________ and
_________________, and their successors shall be appointed by the Holders of a
Majority in Liquidation Amount of the Common Securities and may resign or be
removed by the Holders of a Majority in Liquidation Amount of the Common
Securities at any time. Upon any resignation or removal, the Depositor shall
appoint a successor Administrator. Each Administrator shall sign an agreement
agreeing to comply with the terms of this Trust Agreement. If at any time there
is no
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Administrator, the Property Trustee or any Holder who has been a Holder of
Trust Securities for at least six months may petition any court of competent
jurisdiction for the appointment of one or more Administrators.
(b) Whenever a vacancy in the number of Administrators shall occur, until
such vacancy is filled by the appointment of an Administrator in accordance with
this Section 8.20, the Administrators in office, regardless of their number (and
notwithstanding any other provision of this Agreement), shall have all the
powers granted to the Administrators and shall discharge all the duties imposed
upon the Administrators by this Trust Agreement.
(c) Notwithstanding the foregoing or any other provision of this Trust
Agreement, if any Administrator who is a natural person dies or becomes, in the
opinion of the Holder of a Majority in Liquidation Amount the Common Securities,
incompetent or incapacitated, the vacancy created by such death, incompetence or
incapacity may be filled by the unanimous act of the remaining Administrators,
if there were at least two of them prior to such vacancy, and by the Depositor,
if there were not two such Administrators immediately prior to such vacancy
(with the successor being a Person who satisfies the eligibility requirement for
Administrators set forth in Section 8.7).
ARTICLE IX.
Termination, Liquidation and Merger
Section 9.1. Termination Upon Expiration Date.
Unless earlier terminated, the Issuer Trust shall automatically dissolve,
and its affairs be wound up, on June __, 2053 (the "Expiration Date"), following
the distribution of the Trust Property in accordance with Section 9.4.
Section 9.2. Early Termination.
The first to occur of any of the following events is an "Early Termination
Event":
(a) the occurrence of a Bankruptcy Event in respect of, or the
dissolution or liquidation of, the Depositor, in its capacity as the Holder
of the Common Securities, unless the Depositor shall transfer the Common
Securities as provided by Section 5.11, in which case this provision shall
refer instead to any such successor Holder of the Common Securities;
(b) the written direction to the Property Trustee from the Holder of
the Common Securities at any time to terminate the Issuer Trust and to
distribute the
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Debentures to Holders in exchange for the Capital Securities (which
direction is optional and wholly within the discretion of the Holder of the
Common Securities);
(c) the redemption of all of the Capital Securities in connection
with the redemption of all the Debentures; and
(d) the entry of an order for dissolution of the Issuer Trust by a
court of competent jurisdiction.
Section 9.3. Termination.
The respective obligations and responsibilities of the Issuer Trustees, the
Administrators and the Issuer Trust created and continued hereby shall terminate
upon the latest to occur of the following: (a) the distribution by the Property
Trustee to Holders of all amounts required to be distributed hereunder upon the
liquidation of the Issuer Trust pursuant to Section 9.4, or upon the redemption
of all of the Trust Securities pursuant to Section 4.2; (b) the payment of any
expenses owed by the Issuer Trust; and (c) the discharge of all administrative
duties of the Administrators, including the performance of any tax reporting
obligations with respect to the Issuer Trust or the Holders.
Section 9.4. Liquidation.
(a) If an Early Termination Event specified in clause (a), (b) or (d) of
Section 9.2 occurs or upon the Expiration Date, the Issuer Trust shall be
liquidated by the Property Trustee as expeditiously as the Property Trustee
determines to be possible by distributing, after satisfaction of liabilities to
creditors of the Issuer Trust as provided by applicable law, to each Holder a
Like Amount of Debentures, subject to Section 9.4(d). Notice of liquidation
shall be given by the Property Trustee by first-class mail, postage prepaid
mailed not less than 30 nor more than 60 days prior to the Liquidation Date to
each Holder of Trust Securities at such Holder's address appearing in the
Securities Register. All such notices of liquidation shall:
(i) state the Liquidation Date;
(ii) state that from and after the Liquidation Date, the Trust
Securities will no longer be deemed to be Outstanding and any Securities
Certificates not surrendered for exchange will be deemed to represent a
Like Amount of Debentures; and
(iii) provide such information with respect to the mechanics by which
Holders may exchange Securities Certificates for Debentures, or if Section
9.4(d) applies receive a Liquidation Distribution, as the Property Trustee
(after consultation with the Administrators) shall deem appropriate.
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(b) Except where Section 9.2(c) or 9.4(d) applies, in order to effect the
liquidation of the Issuer Trust and distribution of the Debentures to Holders,
the Property Trustee, either itself acting as exchange agent or through the
appointment of a separate exchange agent, shall establish a record date for such
distribution (which shall be not more than 45 days prior to the Liquidation
Date) and, establish such procedures as it shall deem appropriate to effect the
distribution of Debentures in exchange for the Outstanding Securities
Certificates.
(c) Except where Section 9.2(c) or 9.4(d) applies, after the Liquidation
Date, (i) the Trust Securities will no longer be deemed to be Outstanding, (ii)
certificates representing a Like Amount of Debentures will be issued to Holders
of Securities Certificates, upon surrender of such Certificates to the exchange
agent for exchange, (iii) [the Depositor shall use its best efforts to have the
Debentures listed on the New York Stock Exchange or on such other exchange,
interdealer quotation system or self-regulatory organization on which the
Capital Securities are then listed, (iv)] Securities Certificates not so
surrendered for exchange will be deemed to represent a Like Amount of Debentures
bearing accrued and unpaid interest in an amount equal to the accumulated and
unpaid Distributions on such Securities Certificates until such certificates are
so surrendered (and until such certificates are so surrendered, no payments of
interest or principal will be made to Holders of Securities Certificates with
respect to such Debentures) and [(iv)] [(v)] all rights of Holders holding Trust
Securities will cease, except the right of such Holders to receive Debentures
upon surrender of Securities Certificates.
(d) If, notwithstanding the other provisions of this Section 9.4, whether
because of an order for dissolution entered by a court of competent jurisdiction
or otherwise, distribution of the Debentures in the manner provided herein is
determined by the Property Trustee not to be practical, or if an Early
Termination Event specified in clause (c) of Section 9.2 occurs, the Trust
Property shall be liquidated, and the Issuer Trust shall be dissolved, wound-up
or terminated, by the Property Trustee in such manner as the Property Trustee
determines. In such event, on the date of the dissolution, winding-up or other
termination of the Issuer Trust, Holders will be entitled to receive out of the
assets of the Issuer Trust available for distribution to Holders, after
satisfaction of liabilities to creditors of the Issuer Trust as provided by
applicable law, an amount equal to the Liquidation Amount per Trust Security
plus accumulated and unpaid Distributions thereon to the date of payment (such
amount being the "Liquidation Distribution"). If, upon any such dissolution,
winding up or termination, the Liquidation Distribution can be paid only in part
because the Issuer Trust has insufficient assets available to pay in full the
aggregate Liquidation Distribution, then, subject to the next succeeding
sentence, the amounts payable by the Issuer Trust on the Trust Securities shall
be paid on a pro rata basis (based upon Liquidation Amounts). The Holder of the
Common Securities will be entitled to receive Liquidation Distributions upon any
such dissolution, winding-up or termination pro rata (determined as aforesaid)
with Holders of all Securities, except that, if a Debenture Event of Default
specified in Section 5.1(1) or 5.1(2) of the Indenture has occurred and is
continuing, the Capital Securities shall have a priority over the Common
Securities as provided in Section 4.3.
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Section 9.5. Mergers, Consolidations, Amalgamations or Replacements of
Issuer Trust.
The Issuer Trust may not merge with or into, consolidate, amalgamate, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other body, except pursuant
to this Article IX. At the request of the Holders of the Common Securities, with
the consent of the Holders of at least a Majority in Liquidation Amount of the
Capital Securities, the Issuer Trust may merge with or into, consolidate,
amalgamate, or be replaced by or convey, transfer or lease its properties and
assets substantially as an entirety to a trust organized as such under the laws
of any State; provided, that (i) such successor entity either (A) expressly
assumes all of the obligations of the Issuer 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 have the same priority as the
Capital Securities with respect to distributions and payments upon liquidation,
redemption and otherwise, (ii) a trustee of such successor entity possessing the
same powers and duties as the Property Trustee is appointed to hold the
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 that then assigns a rating to the Capital
Securities, (iv) the Successor Securities are listed, or any Successor
Securities will be listed upon notice of issuance, on any national securities
exchange or interdealer quotation system on which the Capital Securities are
then listed, if any, (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 Issuer Trust, (vii) prior to such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease, the
Property Trustee has received an Opinion of Counsel to the effect that (A) such
merger, consolidation, amalgamation, replacement, conveyance, transfer or lease
does not adversely affect the rights, preferences and privileges of the Holders
of the Capital Securities (including any Successor Securities) in any material
respect, and (B) following such merger, consolidation, amalgamation,
replacement, conveyance, transfer or lease, neither the Issuer Trust nor such
successor entity will be required to register as an "investment company" under
the Investment Company Act, and (viii) the Depositor or its permitted transferee
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 Agreement. Notwithstanding the foregoing,
the Issuer Trust shall not, except with the consent of holders of all of the
Capital Securities, 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 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
Issuer Trust or the successor entity to be taxable as a corporation or
classified as other than a grantor trust for United States federal income tax
purposes or cause the Junior Subordinated Debentures to be treated as other than
indebtedness of the Corporation for United States federal income tax purposes.
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ARTICLE X.
Miscellaneous Provisions
Section 10.1. Limitation of Rights of Holders.
Except as set forth in Section 9.2, the death or incapacity of any person
having an interest, beneficial or otherwise, in Trust Securities shall not
operate to terminate this Trust Agreement, nor entitle the legal representatives
or heirs of such person or any Holder for such person, to claim an accounting,
take any action or bring any proceeding in any court for a partition or winding
up of the arrangements contemplated hereby, nor otherwise affect the rights,
obligations and liabilities of the parties hereto or any of them.
Section 10.2. Agreed Tax Treatment of Issuer Trust and Trust Securities.
The parties hereto and, by its acceptance or acquisition of a Trust
Security or a beneficial interest therein the Holder of, and any person that
acquires a beneficial interest in, such Trust Security intend and agree to treat
the Issuer Trust as a grantor trust for United States federal, state and local
tax purposes, and to treat the Trust Securities (including but not limited to
all payments and proceeds with respect to such Trust Securities) as undivided
beneficial ownership interests in the Trust Property (and payments and proceeds
therefrom, respectively) for United States federal, state and local tax
purposes. The provisions of this Trust Agreement shall be interpreted to further
this intention and agreement of the parties.
Section 10.3. Amendment.
(a) This Trust Agreement may be amended from time to time by the Property
Trustee and the Holder of all the Common Securities, without the consent of any
Holder of the Capital Securities, (i) to cure any ambiguity, correct or
supplement any provision herein that may be inconsistent with any other
provision herein, or to make any other provisions with respect to matters or
questions arising under this Trust Agreement, which shall not be inconsistent
with the other provisions of this Trust Agreement, or (ii) to modify, eliminate
or add to any provisions of this Trust Agreement to such extent as shall be
necessary to ensure that the Issuer Trust will not be taxable as a corporation
or will be classified as other than a grantor trust for United States federal
income tax purposes at all times that any Trust Securities are Outstanding or to
ensure that the Junior Subordinated Debentures are treated as indebtedness of
the Corporation for United States federal income tax purposes, or to ensure that
the Junior Subordinated Debentures are treated as indebtedness of the
Corporation for United States federal income tax purposes, or to ensure that the
Issuer Trust will not be required to register as an "investment company" under
the Investment Company Act; provided, however, that in the case of either
clauses (i) or (ii) such action shall not adversely affect in any material
respect the interests of any Holder.
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(b) Except as provided in Section 10.2(c) hereof, any provision of this
Trust Agreement may be amended by the Property Trustee, the Delaware Trustee and
the Holder of all of the Common Securities and with (i) the consent of Holders
of at least a Majority in Liquidation Amount of the Capital Securities, and (ii)
receipt by the Issuer Trustees of an Opinion of Counsel to the effect that such
amendment or the exercise of any power granted to the Issuer Trustees or the
Administrators in accordance with such amendment will not cause the Issuer Trust
to be taxable as a corporation or classified as other than a grantor trust for
United States federal income tax purposes or affect the treatment of the Junior
Subordinated Debentures as indebtedness of the Corporation for United States
federal income tax purposes or affect the Issuer Trust's exemption from status
as an "investment company" under the Investment Company Act.
(c) In addition to and notwithstanding any other provision in this Trust
Agreement, without the consent of each affected Holder (such consent being
obtained in accordance with Section 6.3 or 6.6 hereof), this Trust Agreement may
not be amended to (i) change the amount or timing of any Distribution on the
Trust Securities or otherwise adversely affect the amount of any Distribution
required to be made in respect of the Trust Securities as of a specified date,
or (ii) restrict the right of a Holder to institute suit for the enforcement of
any such payment on or after such date; and notwithstanding any other provision
herein, without the unanimous consent of the Holders (such consent being
obtained in accordance with Section 6.3 or 6.6 hereof), this paragraph (c) of
this Section 10.2 may not be amended.
(d) Notwithstanding any other provisions of this Trust Agreement, no
Issuer Trustee shall enter into or consent to any amendment to this Trust
Agreement that would cause the Issuer Trust to fail or cease to qualify for the
exemption from status as an "investment company" under the Investment Company
Act or to be taxable as a corporation or to be classified as other than a
grantor trust for United States federal income tax purposes or that would cause
the Junior Subordinated Debentures to fail or cease to be treated as
indebtedness of the Corporation for United States federal income tax purposes.
(e) Notwithstanding anything in this Trust Agreement to the contrary,
without the consent of the Depositor and the Administrators, this Trust
Agreement may not be amended in a manner that imposes any additional obligation
on the Depositor or the Administrators.
(f) If any amendment to this Trust Agreement is made, the Administrators
or the Property Trustee shall promptly provide to the Depositor a copy of such
amendment.
(g) Neither the Property Trustee nor the Delaware Trustee shall be
required to enter into any amendment to this Trust Agreement that affects its
own rights, duties or immunities under this Trust Agreement. The Property
Trustee shall be entitled to receive an Opinion of Counsel and an Officers'
Certificate stating that any amendment to this Trust Agreement is in compliance
with this Trust Agreement.
Section 10.4. Separability.
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If any provision in this Trust Agreement or in the Securities Certificates
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 10.5. Governing Law.
THIS TRUST AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF EACH OF THE HOLDERS,
THE ISSUER TRUST, THE DEPOSITOR, THE ISSUER TRUSTEES AND THE ADMINISTRATORS WITH
RESPECT TO THIS TRUST AGREEMENT AND THE TRUST SECURITIES SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF DELAWARE WITHOUT
REFERENCE TO ITS CONFLICTS OF LAWS PROVISIONS. THE PROVISIONS OF SECTION 3540
OF TITLE 12 OF THE DELAWARE CODE SHALL NOT APPLY TO THIS TRUST.
Section 10.6. Payments Due on Non-Business Day.
If the date fixed for any payment on any Trust Security shall be a day that
is not a Business Day, then such payment need not be made on such date but may
be made on the next succeeding day that is a Business Day (except as otherwise
provided in Sections 4.1(a) and 4.2(d)), with the same force and effect as
though made on the date fixed for such payment, and no Distributions shall
accumulate on such unpaid amount for the period after such date.
Section 10.7. Successors.
This Trust Agreement shall be binding upon and shall inure to the benefit
of any successor to the Depositor, the Issuer Trust, the Administrators and any
Issuer Trustee, including any successor by operation of law. Except in
connection with a consolidation, merger or sale involving the Depositor that is
permitted under Article VIII of the Indenture and pursuant to which the assignee
agrees in writing to perform the Depositor's obligations hereunder, the
Depositor shall not assign its obligations hereunder.
Section 10.8. Headings.
The Article and Section headings are for convenience only and shall not
affect the construction of this Trust Agreement.
Section 10.9. Reports, Notices and Demands.
Any report, notice, demand or other communication that by any provision of
this Trust Agreement is required or permitted to be given or served to or upon
any Holder or the Depositor may be given or served in writing by deposit
thereof, first-class postage prepaid, in the United
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States mail, hand delivery or facsimile transmission, in each case, addressed,
(a) in the case of a Holder of Capital Securities, to such Holder as such
Holder's name and address may appear on the Securities Register; and (b) in the
case of the Holder of all the Common Securities or the Depositor, to American
Express Company, World Financial Center, 200 Vesey Street, New York, New York
10285, Attention: Secretary, facsimile no.: ______________, or to such other
address as may be specified in a written notice by the Holder of all the Common
Securities or the Depositor, as the case may be, to the Property Trustee. Such
notice, demand or other communication to or upon a Holder shall be deemed to
have been sufficiently given or made, for all purposes, upon hand delivery,
mailing or transmission. Such notice, demand or other communication to or upon
the Depositor shall be deemed to have been sufficiently given or made only upon
actual receipt of the writing by the Depositor.
Any notice, demand or other communication that by any provision of this
Trust Agreement is required or permitted to be given or served to or upon the
Issuer, the Property Trustee, the Delaware Trustee, the Administrators or the
Trust shall be given in writing by deposit thereof, first-class postage prepaid,
in the U.S. mail, hand delivery or facsimile transmission, addressed to such
Person as follows: (a) with respect to the Property Trustee to Bankers Trust
Company, Four Albany Street, Fourth Floor, New York, New York 10006, Attention:
Corporate Trust and Agency Services, facsimile no.: (212) 250-6392/6961; (b)
with respect to the Delaware Trustee, to Bankers Trust (Delaware), E.A. Delle
Donne Corporate Center, Montgomery Building, 1011 Centre Road, Suite 200,
Wilmington, Delaware 19805, Attention: Lisa Wilkins; (c) with respect to the
Administrators, to them at the address above for notices to the Depositor,
marked "Attention: Administrators of American Express Company Capital Trust I";
and (d) with respect to the Issuer Trust, to its principal office specified in
Section 2.1, with a copy to the Property Trustee. Such notice, demand or other
communication to or upon the Issuer Trust, the Property Trustee or the
Administrators shall be deemed to have been sufficiently given or made only upon
actual receipt of the writing by the Issuer Trust, the Property Trustee or such
Administrator.
Section 10.10. Agreement Not to Petition.
Each of the Issuer Trustees and the Depositor agree for the benefit of the
Holders that, until at least one year and one day after the Issuer Trust has
been terminated in accordance with Article IX, they shall not file, or join in
the filing of, a petition against the Issuer Trust under any bankruptcy,
insolvency, reorganization or other similar law (including the United States
Bankruptcy Code) (collectively, "Bankruptcy Laws") or otherwise join in the
commencement of any proceeding against the Issuer Trust under any Bankruptcy
Law. If the Depositor takes action in violation of this Section 10.9, the
Property Trustee agrees, for the benefit of Holders, that at the expense of the
Depositor, it shall file an answer with the bankruptcy court or otherwise
properly contest the filing of such petition by the Depositor against the Issuer
Trust or the commencement of such action and raise the defense that the
Depositor has agreed in writing not to take such action and should be estopped
and precluded therefrom and such other defenses, if any, as counsel for the
Issuer Trustee or the Issuer Trust may assert.
61
<PAGE>
Section 10.11. Trust Indenture Act; Conflict with Trust Indenture Act.
(a) This Trust Agreement is subject to the provisions of the Trust
Indenture Act that are required to be part of this Trust Agreement and shall, to
the extent applicable, be governed by such provisions of the Trust Indenture
Act.
(b) The Property Trustee shall be the only Issuer Trustee that is a
trustee for the purposes of the Trust Indenture Act.
(c) If any provision hereof limits, qualifies or conflicts with the duties
imposed by Sections 310 to 317, inclusive, of the Trust Indenture Act through
operation of Section 318(c) thereof, such imposed duties shall control. If any
provision of this Trust Agreement modifies or excludes any provision of the
Trust Indenture Act which may be so modified or excluded, the latter provision
shall be deemed to apply to this Trust Agreement as so modified or excluded, as
the case may be.
(d) The application of the Trust Indenture Act to this Trust Agreement
shall not affect the nature of the Trust Securities as equity securities
representing undivided beneficial interests in the assets of the Issuer Trust.
Section 10.12. Acceptance of Terms of Trust Agreement, Guarantee Agreement
and Indenture.
THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST THEREIN BY
OR ON BEHALF OF A HOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY SIGNATURE OR
FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL ACCEPTANCE
BY THE HOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN SUCH TRUST SECURITY
OF ALL THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT, THE GUARANTEE AGREEMENT
AND THE INDENTURE, AND AGREEMENT TO THE SUBORDINATION PROVISIONS, THE TAX
TREATMENT PROVISION AND OTHER TERMS OF THE GUARANTEE AGREEMENT AND THE
INDENTURE, AND SHALL CONSTITUTE THE AGREEMENT OF THE ISSUER TRUST, SUCH HOLDER
AND SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT SHALL BE
BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE ISSUER TRUST AND SUCH HOLDER AND
SUCH OTHERS.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
62
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Amended and
Restated Trust Agreement as of the day and year first above written.
American Express Company,
as Depositor
By:
------------------------------------
Name:
Title:
Bankers Trust Company,
as Property Trustee
By:
------------------------------------
Name:
Title: Vice President
Bankers Trust (Delaware),
as Delaware Trustee and not in its
individual capacity
By:
------------------------------------
Name:
Title: Vice President
<PAGE>
Exhibit A
[CERTIFICATE OF TRUST]
OF
AMERICAN EXPRESS COMPANY CAPITAL TRUST _
This Certificate of Trust of American Express Company Capital Trust _
(the "Trust"), dated ____ __, 199_, is being duly executed and filed on behalf
of the Trust by the undersigned, as trustee, to form a business trust under the
Delaware Business Trust Act (12 Del. C. (S) 3801 et seq.)(the "Act").
1. Name. The name of the business trust formed by this Certificate
----
of Trust is American Express Company Capital Trust _.
2. Delaware Trustee. The name and business address of the trustee
----------------
of the Trust in the State of Delaware are Bankers Trust (Delaware), E.A. Delle
Donne Corporate Center, Montgomery Building, 1011 Centre Road, Suite 200,
Wilmington, Delaware 19805-1266.
3. Effective Date. This Certificate of Trust shall be effective
--------------
upon its filing.
IN WITNESS WHEREOF, the undersigned has duly executed this
Certificate of Trust in accordance with Section 3811(a)(1) of the Act.
Bankers Trust (Delaware), not in its
individual capacity but solely as trustee
By:
-----------------------------------------
Name:
Title:
A-1
<PAGE>
Exhibit B
[FORM OF LETTER OF REPRESENTATIONS]
____ ___, 199_
The Depository Trust Company,
55 Water Street, 49th Floor,
New York, New York 10041-0099.
Attention: General Counsel's Office
Re: American Express Company Capital Trust _
___% Capital Securities, Series _
CUSIP No.
---------------------------------
Ladies and Gentlemen:
The purpose of this letter is to set forth certain matters relating to
the issuance and deposit with The Depository Trust Company ("DTC") of the book-
entry-only portion of the ____% Capital Securities, Series _ (the "Capital
Securities"), of American Express Company Capital Trust _, a statutory business
trust formed under the laws of the State of Delaware (the "Issuer"), governed by
the Amended and Restated Trust Agreement, dated as of ____ __, 199_ (the
"Amended and Restated Trust Agreement"), between American Express Company (the
"Corporation"), as Depositor, Bankers Trust Company, as Property Trustee,
Bankers Trust (Delaware), as Delaware Trustee and Several Holders as defined
therein. The payment of distributions on the Capital Securities and payments
due upon liquidation of the Issuer or redemption of the Capital Securities, to
the extent the Issuer has funds available for the payment thereof, are
guaranteed by the Corporation to the extent set forth in a Guarantee Agreement,
dated as of ____ __, 199_, between the Corporation and Bankers Trust Company, as
Guarantee Trustee with respect to the Capital Securities. The Corporation and
the Issuer propose to sell the Capital Securities to the Underwriters (the
"Underwriters") pursuant to a Pricing Agreement, dated as of ____ __, 199_, by
and among the Underwriters, the Issuer and the Corporation, and the Underwriting
Agreement, dated as of ____ __, 199_, by and among the Underwriters, the Issuer
and the Corporation, and the Underwriters wish to take delivery of the Capital
Securities through DTC. Bankers Trust Company is acting as transfer agent and
registrar with respect to the Capital Securities (the "Transfer Agent and
Registrar").
B-1
<PAGE>
To induce DTC to accept the Capital Securities as eligible for deposit
at DTC, and to act in accordance with DTC's rules with respect to the Capital
Securities, the Issuer and the Transfer Agent and Registrar make the following
representations to DTC:
1. Prior to the closing of the sale of the Capital Securities to the
Underwriters on ____ __, 199_, there shall be deposited with, or held by the
Transfer Agent and Registrar as custodian for, DTC one or more global
certificates (individually and collectively, the "Global Certificate")
registered in the name of DTC's nominee, Cede & Co., representing an aggregate
of ________ Capital Securities and bearing the following legend:
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to Issuer 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 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.
2. The Amended and Restated Trust Agreement of the Issuer provides
for the voting by holders (with no provision for revocation of consents or votes
by subsequent holders) of the Capital Securities under certain limited
circumstances. The Issuer shall establish a record date for such purposes and
shall, to the extent possible, give DTC notice of such record date not less than
15 calendar days in advance of such record date.
3. In the event of a stock split, conversion, recapitalization,
reorganization or any other similar transaction resulting in the cancellation of
all or any part of the Series A Capital Securities outstanding, the Issuer or
the Transfer Agent and Registrar shall send DTC a notice of such event as soon
as possible but, at least 5 business days prior to the effective date of such
event.
4. In the event of any distribution on, or an offering or issuance
of rights with respect to, the Capital Securities outstanding, the Issuer or the
Transfer Agent and Registrar shall send DTC a notice specifying: (a) the amount
of and conditions, if any, applicable to the payment of any such distribution or
any such offering or issuance of rights; (b) any applicable expiration or
deadline date, or any date by which any action on the part of the holders of
Capital Securities is required; and (c) the date any required notice is to be
mailed by or on behalf of the Issuer to holders of Capital Securities or
published by or on behalf of the Issuer (whether by mail or publication, the
"Publication Date"). Such notice shall be sent to DTC by a secure means (e.g.,
- -
legible telecopy, registered or certified mail, overnight delivery) in a timely
manner designed to
B-2
<PAGE>
assure that such notice is in DTC's possession no later than the close of
business on the business day before the Publication Date. The Issuer or the
Transfer Agent and Registrar will forward such notice either in a separate
secure transmission for each CUSIP number or in a secure transmission of
multiple CUSIP numbers (if applicable) that includes a manifest or list of each
CUSIP number submitted in that transmission. (The party sending such notice
shall have a method to verify subsequently the use of such means and the
timeliness of such notice.) The Publication Date shall be not less than 30
calendar days nor more than 60 calendar days prior to the payment of any such
distribution or any such offering or issuance of rights with respect to the
Capital Securities. After establishing the amount of payment to be made on the
Capital Securities, the Issuer or the Transfer Agent and Registrar will notify
DTC's Dividend Department of such payment 5 business days prior to payment date.
Notices to DTC's Dividend Department by telecopy shall be sent to (212) 709-
1723. Such notices by mail or by any other means shall be sent to:
Manager, Announcements
Dividend Department
The Depository Trust Company
7 Hanover Square, 23rd Floor
New York, New York 10004-2695
The Issuer or the Transfer Agent and Registrar shall confirm DTC's
receipt of such telecopy by telephoning the Dividend Department at (212) 709-
1270.
5. In the event of a redemption by the Issuer of the Capital
Securities, notice specifying the terms of the redemption and the Publication
Date of such notice shall be sent by the Issuer or the Transfer Agent and
Registrar to DTC not less than 30 calendar days prior to such event by a secure
means in the manner set forth in paragraph 4. Such redemption notice shall be
sent to DTC's Call Notification Department at (516) 227-4164 or (516) 227-4190,
and receipt of such notice shall be confirmed by telephoning (516) 227-4070.
Notice by mail or by any other means shall be sent to:
Call Notification Department
The Depository Trust Company
711 Stewart Avenue
Garden City, New York 11530-4719
6. In the event of any invitation to tender the Capital Securities,
notice specifying the terms of the tender and the Publication Date of such
notice shall be sent by the Issuer or the Transfer Agent and Registrar to DTC by
a secure means and in a timely manner as described in paragraph 4. Notices to
DTC pursuant to this paragraph and notices of other corporate actions (including
mandatory tenders, exchanges and capital changes), shall be sent, unless
notification to another department is expressly provided for herein, by telecopy
to DTC's
B-3
<PAGE>
Reorganization Department at (212) 709-1093 or (212) 709-1094 and receipt of
such notice shall be confirmed by telephoning (212) 709-6884, or by mail or any
other means to:
Manager, Reorganization Department
Reorganization Window
The Depository Trust Company
7 Hanover Square, 23rd Floor
New York, New York 10004-2695
7. All notices and payment advices sent to DTC shall contain the
CUSIP number or numbers of the Capital Securities and the accompanying
designation of the Capital Securities, which, as of the date of this letter, is
"American Express Company Capital Trust I, ___% Capital Securities".
8. Distribution payments or other cash payments with respect to the
Capital Securities shall be governed by DTC's current Principal and Income
Payments Rider, a copy of which is attached hereto as Annex I. For purposes of
this letter, the term "Agent" used in Annex I shall be deemed to refer to
Bankers Trust Company or any successor Property Trustee under the Amended and
Restated Trust Agreement.
9. DTC may direct the Issuer and the Transfer Agent and Registrar to
use any other telecopy number or address of DTC as the number or address to
which notices or payments may be sent.
10. In the event of a conversion, redemption, or any other similar
transaction (e.g., tender made and accepted in response to the Issuer's or the
- -
Transfer Agent and Registrar's invitation) necessitating a reduction in the
aggregate number of Capital Securities outstanding evidenced by the Global
Certificate, DTC, in its discretion: (a) may request the Issuer or the Transfer
Agent and Registrar to issue and countersign a new Global Certificate; or (b)
may make an appropriate notation on the Global Certificate indicating the date
and amount of such reduction.
11. DTC may discontinue its services as a securities depositary with
respect to the Capital Securities at any time by giving reasonable prior written
notice to the Issuer and the Transfer Agent and Registrar (at which time DTC
will confirm with the Issuer or the Transfer Agent and Registrar the aggregate
number of Capital Securities deposited with it) and discharging its
responsibilities with respect thereto under applicable law. Under such
circumstances, the Issuer may determine to make alternative arrangements for
book-entry settlement for the Capital Securities, make available one or more
separate global certificates evidencing Capital Securities to any Participant
having Capital Securities credited to its DTC account, or issue definitive
Capital Securities to the beneficial holders thereof, and in any such case, DTC
agrees to cooperate fully with the Issuer and the Transfer Agent and Registrar
and to return the Global Certificate, duly
B-4
<PAGE>
endorsed for transfer as directed by the Issuer or the Transfer Agent and
Registrar, together with any other documents of transfer reasonably requested by
the Issuer or the Transfer Agent and Registrar.
12. In the event that the Issuer determines that beneficial owners of
Capital Securities shall be able to obtain definitive Capital Securities, the
Issuer or the Transfer Agent and Registrar shall notify DTC of the availability
of certificates. In such event, the Issuer or the Transfer Agent and Registrar
shall issue, transfer and exchange certificates in appropriate amounts, as
required by DTC and others, and DTC agrees to cooperate fully with the Issuer
and the Transfer Agent and Registrar and to return the Global Certificate, duly
endorsed for transfer as directed by the Issuer or the Transfer Agent and
Registrar, together with any other documents of transfer reasonably requested by
the Issuer or the Transfer Agent and Registrar.
13. This letter may be executed in any number of counterparts, each
of which when so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
B-5
<PAGE>
Nothing herein shall be deemed to require the Transfer Agent and Registrar
to advance funds on behalf of American Express Company Capital Trust _.
Very truly yours,
AMERICAN EXPRESS COMPANY
CAPITAL TRUST _
(As Issuer)
By:
------------------------------------
Administrator
BANKERS TRUST COMPANY
(As Transfer Agent and Registrar)
By:
------------------------------------
Name:
Title:
RECEIVED AND ACCEPTED:
THE DEPOSITORY TRUST COMPANY
By:
-----------------------------
Authorized Officer
B-6
<PAGE>
Exhibit C
[FORM OF COMMON SECURITIES CERTIFICATE]
THIS CERTIFICATE IS NOT TRANSFERABLE EXCEPT TO THE DEPOSITOR OR AN AFFILIATE OF
THE DEPOSITOR IN COMPLIANCE WITH APPLICABLE LAW AND SECTION 5.11 OF THE TRUST
AGREEMENT AND ONLY IN CONNECTION WITH A SIMULTANEOUS DELEGATION AND ASSIGNMENT
OF THE EXPENSE AGREEMENT REFERRED TO THEREIN
Certificate Number Number of Common Securities
C-
Certificate Evidencing Common Securities
of
American Express Company Capital Trust _
____% Common Securities
(liquidation amount [$25] [$1,000] per Common Security)
American Express Company Capital Trust _, a statutory business trust formed
under the laws of the State of Delaware (the "Issuer Trust"), hereby certifies
that [NAME OF HOLDER] (the "Holder") is the registered owner of ____ common
securities of the Issuer Trust representing undivided common beneficial
interests in the assets of the Issuer Trust and designated the ____% Common
Securities (liquidation amount [$25] [$1,000] per Common Security) (the "Common
Securities"). Except in accordance with Section 5.11 of the Trust Agreement (as
defined below) the Common Securities are not transferable and any attempted
transfer hereof other than in accordance therewith shall be void. The
designations, rights, privileges, restrictions, preferences and other terms and
provisions of the Common Securities are set forth in, and this certificate and
the Common Securities represented hereby are issued and shall in all respects be
subject to the terms and provisions of, the Amended and Restated Trust Agreement
of the Issuer Trust, dated as of ____ __, 199_, as the same may be amended from
time to time (the "Trust Agreement"), among American Express Company, as
Depositor, Bankers Trust Company, as Property Trustee, Bankers Trust (Delaware),
as Delaware Trustee, and the Holders of Trust Securities, including the
designation of the terms of the Common Securities as set forth therein. The
Issuer Trust will furnish a copy of the Trust Agreement to the Holder without
charge upon written request to the Issuer Trust at its principal place of
business or registered office.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
C-1
<PAGE>
This Common Securities Certificate shall be governed by and construed in
accordance with the laws of the State of Delaware.
Terms used but not defined herein have the meanings set forth in the Trust
Agreement.
In Witness Whereof, one of the Administrators of the Issuer Trust has
executed this certificate this day of .
American Express Company Capital Trust _
By:
-------------------------------------------
Name:
Administrator
C-2
<PAGE>
Exhibit D
[FORM OF EXPENSE AGREEMENT]
AGREEMENT AS TO EXPENSES AND LIABILITIES
Agreement as to Expenses and Liabilities, dated as of ____ __, 199_,
between American Express Company, a New York corporation, as holder of the
Common Securities and issuer of Debentures (the "Corporation"), and American
Express Company Capital Trust _, a Delaware business trust (the "Issuer Trust").
Whereas, the Issuer Trust intends to issue its Common Securities (the
"Common Securities") to and acquire Debentures from the Corporation and to issue
and sell ____% Capital Securities (the "Capital Securities") with such powers,
preferences and special rights and restrictions as are set forth in the Amended
and Restated Trust Agreement, dated as of ____ __, 199_, among American Express
Company, as Depositor, Bankers Trust Company, as Property Trustee, Bankers Trust
(Delaware), as Delaware Trustee, and the Holders of Trust Securities, as the
same may be amended from time to time (the "Trust Agreement");
Whereas, the Corporation will directly or indirectly own all of the Common
Securities of the Trust and will issue the Debentures;
Whereas, capitalized terms used but not defined herein have the meanings
set forth in the Trust Agreement;
Now, Therefore, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
ARTICLE I
Section 1.1. Guarantee by the Corporation. The Corporation hereby agrees to
assume any and all Obligations (as hereinafter defined) of the Issuer Trust and,
in the event any such Obligation is not so assumed, subject to the terms and
conditions hereof, the Corporation hereby irrevocably and unconditionally
guarantees to each person or entity to whom the Issuer Trust is now or hereafter
becomes indebted or liable (the "Beneficiaries") the full payment, when and as
due, of any and all Obligations (as hereinafter defined) to such Beneficiaries.
As used herein, "Obligations" means any costs, expenses or liabilities (but not
including liabilities relating to taxes) of the Issuer Trust, other than
obligations of the Issuer Trust to pay to holders of any Trust Securities the
amounts due such holders pursuant to the terms of the Trust Securities. This
Agreement is intended to be for the benefit of, and to be enforceable by, all
such Beneficiaries, whether or not such Beneficiaries have received notice
hereof.
D-1
<PAGE>
Section 1.2. Subordination of Guarantee. The guarantee and other
liabilities and obligations of the Corporation under this Agreement shall
constitute unsecured obligations of the Corporation and shall rank subordinate
and junior in right of payment to all Senior Indebtedness (as defined in the
Indenture) of the Corporation to the extent and in the manner set forth in the
Indenture with respect to the Debentures, and the provisions of Article XIII of
the Indenture will apply, mutatis mutandis, to the obligations of the
Corporation hereunder. The obligations of the Corporation hereunder do not
constitute Senior Indebtedness (as defined in the Indenture) of the Corporation.
Section 1.3. Term of Agreement. This Agreement shall terminate and be of no
further force and effect upon the later of (a) the date on which full payment
has been made of all amounts payable to all holders of all the Capital
Securities (whether upon redemption, liquidation, exchange or otherwise) and (b)
the date on which the Debentures shall have been distributed to the Holders of
the Trust Securities as provided in Article IX of the Trust Agreement; provided,
however, that this Agreement shall continue to be effective or shall be
reinstated, as the case may be, if at any time any holder of Capital Securities
or any Beneficiary must restore payment of any sums paid under the Capital
Securities, under any Obligation, under the Guarantee Agreement dated the date
hereof by the Corporation and Bankers Trust Company, as guarantee trustee, or
under this Agreement for any reason whatsoever. This Agreement is continuing,
irrevocable, unconditional and absolute.
Section 1.4. Waiver of Notice. The Corporation hereby waives notice of
acceptance of this Agreement and of any Obligation to which it applies or may
apply, and the Corporation hereby waives presentment, demand for payment,
protest, notice of nonpayment, notice of dishonor, notice of redemption and all
other notices and demands.
Section 1.5. No Impairment. The obligations, covenants, agreements and
duties of the Corporation under this Agreement shall in no way be affected or
impaired by reason of the happening from time to time of any of the following:
(a) the extension of time for the payment by the Issuer Trust of all or any
portion of the Obligations or for the performance of any other obligation under,
arising out of, or in connection with, the Obligations;
(b) any failure, omission, delay or lack of diligence on the part of the
Beneficiaries to enforce, assert or exercise any right, privilege, power or
remedy conferred on the Beneficiaries with respect to the Obligations or any
action on the part of the Issuer Trust granting indulgence or extension of any
kind; or
(c) 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 Issuer Trust or any of the assets of
the Issuer Trust (other than the dissolution of the Trust in accordance with the
terms thereof).
D-2
<PAGE>
There shall be no obligation of the Beneficiaries to give notice to, or obtain
the consent of, the Corporation with respect to the happening of any of the
foregoing.
Section 1.6. Enforcement. A Beneficiary may enforce this Agreement directly
against the Corporation and the Corporation waives any right or remedy to
require that any action be brought against the Issuer Trust or any other person
or entity before proceeding against the Corporation.
Section 1.7. Subrogation. The Corporation shall be subrogated to all rights
(if any) of any Beneficiary against the Issuer Trust in respect of any amounts
paid to the Beneficiaries by the Corporation under this Agreement; provided,
however, that the Corporation shall not (except to the extent required by
mandatory provisions of law) be entitled to enforce or exercise any rights that
it may acquire by way of subrogation or any indemnity, reimbursement or other
agreement, in all cases as a result of payment under this Agreement, if, at the
time of any such payment, any amounts are due and unpaid under this Agreement.
ARTICLE II
Section 2.1. Assignment. This Agreement may not be assigned by either party
hereto without the consent of the other, and any purported assignment without
such consent shall be void; provided, however, that, upon any transfer of the
Common Securities, this Agreement shall be assigned and delegated by the
Corporation to its successor with such transfer without any action by either
party hereto.
Section 2.2. Binding Effect. All guarantees and agreements contained in
this Agreement shall bind the successors, assigns, receivers, trustees and
representatives of the Corporation and shall inure to the benefit of the
Beneficiaries.
Section 2.3. Amendment. So long as there remains any Beneficiary or any
Capital Securities are outstanding, this Agreement shall not be modified or
amended in any manner adverse to such Beneficiary or to the holders of the
Capital Securities without the consent of such Beneficiary or the holders of the
Capital Securities, as the case may be.
Section 2.4. Notices. Any notice, request or other communication required
or permitted to be given hereunder shall be given in writing by delivering the
same against receipt therefor by facsimile transmission (confirmed by mail),
telex or by registered or certified mail, addressed as follows (and if so given,
shall be deemed
D-3
<PAGE>
given when mailed or upon receipt of an answer-back, if sent by telex):
American Express Company Capital Trust _
c/o Bankers Trust Company
Four Albany Street
Fourth Floor
New York, New York 10006
Facsimile No.: (212) 250-6392/6961
Attention: Corporate Trust and Agency Services
With a copy to:
American Express Company
World Financial Center
200 Vesey Street
New York, New York 10285
Facsimile No.: ______________
Attention: Secretary
Section 2.5. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
D-4
<PAGE>
This Agreement is executed as of the day and year first above written.
American Express Company
By:
----------------------------------
Name:
Title:
American Express Company
Capital Trust _
By:
----------------------------------
Name:
Title: Administrator
D-5
<PAGE>
Exhibit E
[FORM OF CAPITAL SECURITIES CERTIFICATE]
[If the Capital Securities Certificate is to be Evidenced By a Global
Capital Security, insert--This Capital Securities Certificate is a Global
Capital Security within the meaning of the Trust Agreement hereinafter referred
to and is registered in the name of a Depositary or a nominee of a Depositary.
This Capital Securities Certificate is exchangeable for Capital Securities
Certificates registered in the name of a person other than the Depositary or its
nominee only in the limited circumstances described in the Trust Agreement and
may not be transferred except 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, except in the limited circumstances described in the
Trust Agreement.
Unless this Capital Security Certificate is presented by an authorized
representative of The Depository Trust Company, a New York Corporation ("DTC"),
to American Express Company Capital Trust 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 is requested by an
authorized representative of DTC (and any payment is made to Cede & Co. or to
such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO A PERSON IS
WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.]
E-1
<PAGE>
CERTIFICATE NUMBER NUMBER OF CAPITAL SECURITIES
CAI-
CUSIP NO.
---------------
CERTIFICATE EVIDENCING CAPITAL SECURITIES
OF
AMERICAN EXPRESS COMPANY CAPITAL TRUST _
____% CAPITAL SECURITIES, SERIES _
(LIQUIDATION AMOUNT [$25] [$1,000] PER CAPITAL SECURITY)
American Express Company Capital Trust _, a statutory business trust formed
under the laws of the State of Delaware (the "Issuer Trust"), hereby certifies
that (the "Holder") is the registered owner of
-------------------------------
( ) Capital Securities of the Trust representing an
- ----------------------
undivided preferred beneficial interest in the assets of the Trust and
designated the American Express Company Capital Trust _ ____% Capital
Securities, Series _ (liquidation amount [$25] [$1,000] per Capital Security)
(the "Capital Securities"). The Capital Securities are transferable on the books
and records of the Issuer 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 Section 5.5 of the Trust Agreement (as defined below). The
designations, rights, privileges, restrictions, preferences and other terms and
provisions of the Capital Securities are set forth in, and this certificate and
the Capital Securities represented hereby are issued and shall in all respects
be subject to the terms and provisions of, the Trust Agreement of the Issuer
Trust, dated as of ____ __, 199_, as the same may be amended from time to time
(the "Trust Agreement"), among American Express Company, as Depositor, Bankers
Trust Company, as Property Trustee, Bankers Trust (Delaware), as Delaware
Trustee, and the Holders of Trust Securities, including the designation of the
terms of the Capital Securities as set forth therein. The Holder is entitled to
the benefits of the Guarantee Agreement entered into by American Express
Company, a New York corporation, and Bankers Trust Company, as Guarantee
Trustee, dated as of ____ __, 199_ (the "Guarantee Agreement"), to the extent
provided therein. The Trust will furnish a copy of the Issuer Trust Agreement
and the Guarantee Agreement to the Holder without charge upon written request to
the Property Trustee at its principal place of business or registered office.
Upon receipt of this certificate, the Holder is bound by the Trust
Agreement and is entitled to the benefits thereunder.
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<PAGE>
This Capital Securities Certificate shall be governed by and construed in
accordance with the laws of the State of Delaware.
All capitalized terms used but not defined in this Capital Securities
Certificate are used with the meanings specified in the Trust Agreement,
including the Exhibits thereto.
In Witness Whereof, one of the Administrators of the Issuer Trust has
executed this certificate this day of , .
American Express Company Capital Trust _
By:
----------------------------
Name:
Administrator
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<PAGE>
ASSIGNMENT
For Value Received, the undersigned assigns and transfers this Capital
Security to:
- --------------------------------------------------------------------------------
(Insert assignee's social security or tax identification number)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Insert address and zip code of assignee)
and irrevocably appoints
-------------------------------------------------------
- --------------------------------------------------------------------------------
agent to transfer this Capital Security Certificate on the books of the Issuer
Trust. The agent may substitute another to act for him or her.
Date:
-----------------
Signature:
-------------------------------------------------------------------
(Sign exactly as your name appears on the other side of
this Capital Security Certificate)
The signature(s) should be guaranteed by an eligible guarantor institution
(banks, stockbrokers, savings and loan associations and credit unions with
membership in an approved signature guarantee medallion program), pursuant to
S.E.C. Rule 17Ad-15.
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<PAGE>
Exhibit 4.8
GUARANTEE AGREEMENT
BY AND BETWEEN
AMERICAN EXPRESS COMPANY,
as Guarantor
and
BANKERS TRUST COMPANY,
as Guarantee Trustee
RELATING TO
AMERICAN EXPRESS COMPANY CAPITAL TRUST _
---------------
Dated as of ____ __, 199_
---------------
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I
Definitions
Section 1.1. Definitions............................................... 1
ARTICLE II
Trust Indenture Act
Section 2.1. Trust Indenture Act; Application.......................... 4
Section 2.2. List of Holders........................................... 5
Section 2.3. Reports by the Guarantee Trustee.......................... 5
Section 2.4. Periodic Reports to the Guarantee Trustee................. 5
Section 2.5. Evidence of Compliance with Conditions Precedent.......... 5
Section 2.6. Events of Default; Waiver................................. 6
Section 2.7. Event of Default; Notice.................................. 6
Section 2.8. Conflicting Interests..................................... 6
ARTICLE III
Powers, Duties and Rights of the Guarantee Trustee
Section 3.1. Powers and Duties of the Guarantee Trustee................ 6
Section 3.2. Certain Rights of Guarantee Trustee....................... 8
Section 3.3. Compensation; Indemnity; Fees............................. 9
ARTICLE IV
Guarantee Trustee
Section 4.1. Guarantee Trustee; Eligibility............................ 10
Section 4.2. Appointment, Removal and Resignation of the Guarantee
Trustee.................................................. 10
ARTICLE V
Section 5.1. Guarantee................................................. 11
Section 5.2. Waiver of Notice and Demand............................... 12
Section 5.3. Obligations Not Affected.................................. 12
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<PAGE>
Section 5.4. Rights of Holders......................................... 13
Section 5.5. Guarantee of Payment...................................... 13
Section 5.6. Subrogation............................................... 13
Section 5.7. Independent Obligations................................... 13
ARTICLE VI
Covenants and Subordination
Section 6.1. Subordination............................................. 14
Section 6.2. Pari Passu Guarantees..................................... 14
ARTICLE VII
Termination
Section 7.1. Termination............................................... 14
ARTICLE VIII
Miscellaneous
Section 8.1. Successors and Assigns.................................... 14
Section 8.2. Amendments................................................ 15
Section 8.3. Notices................................................... 15
Section 8.4. Benefit................................................... 16
Section 8.5. Governing Law............................................. 16
Section 8.6. Counterparts.............................................. 16
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<PAGE>
CROSS REFERENCE TABLE*
Section of
Trust Indenture Act Section of
of 1939, as amended Guarantee Agreement
- ------------------- -------------------
310(a)................................................................... 4.1(a)
310(b).............................................................. 4.1(c), 2.8
310(c)............................................................. Inapplicable
311(a)................................................................... 2.2(b)
311(b)................................................................... 2.2(b)
311(c)............................................................. Inapplicable
312(a)................................................................... 2.2(a)
312(b)................................................................... 2.2(b)
313......................................................................... 2.3
314(a)...................................................................... 2.4
314(b)............................................................. Inapplicable
314(c)...................................................................... 2.5
314(d)............................................................. Inapplicable
314(e)............................................................ 1.1, 2.5, 3.2
314(f)................................................................. 2.1, 3.2
315(a)................................................................... 3.1(d)
315(b)...................................................................... 2.7
315(c)...................................................................... 3.1
315(d)................................................................... 3.1(d)
316(a)............................................................ 1.1, 2.6, 5.4
316(b)...................................................................... 5.3
316(c)...................................................................... 8.2
317(a)............................................................. Inapplicable
317(b)............................................................. Inapplicable
318(a)...................................................................... 2.1
318(b)...................................................................... 2.1
318(c)...................................................................... 2.1
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* This Cross Reference Table does not constitute part of the Guarantee
Agreement and shall not affect the interpretation of any of its terms or
provisions.
<PAGE>
GUARANTEE AGREEMENT, dated as of ____ __, 199_, between AMERICAN EXPRESS
COMPANY, a New York corporation (the "Guarantor"), having its principal office
at World Financial Center, 200 Vesey Street, New York, New York 10285, and
BANKERS TRUST COMPANY, a New York banking corporation, as trustee (the
"Guarantee Trustee"), for the benefit of the Holders (as defined herein) from
time to time of the Capital Securities (as defined herein) of AMERICAN EXPRESS
COMPANY CAPITAL TRUST _, a Delaware statutory business trust (the "Issuer
Trust").
Recitals of the Corporation
Whereas, pursuant to an Amended and Restated Trust Agreement, dated as of
____ __, 199_ (the "Trust Agreement"), among American Express Company, as
Depositor, the Property Trustee and the Delaware Trustee named therein and the
holders from time to time of undivided beneficial interests in the assets of the
Issuer Trust, the Issuer Trust is issuing $500,000,000 aggregate Liquidation
Amount (as defined in the Trust Agreement) of its ____% Capital Securities,
Series I (liquidation amount [$25] [$1,000] per capital security) (the "Capital
Securities"), representing preferred undivided beneficial interests in the
assets of the Issuer Trust and having the terms set forth in the Trust
Agreement; and
Whereas, the Capital Securities will be issued by the Issuer Trust and the
proceeds thereof, together with the proceeds from the issuance of the Issuer
Trust's Common Securities (as defined herein), will be used to purchase the
Debentures (as defined in the Trust Agreement) of the Guarantor, which
Debentures will be deposited with Bankers Trust Company, as Property Trustee
under the Trust Agreement, as trust assets; and
Whereas, as an incentive for the Holders to purchase Capital Securities,
the Guarantor desires irrevocably and unconditionally to agree, as described
herein, to pay to the Holders of the Capital 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 of Capital Securities by
each Holder, which purchase the Guarantor hereby acknowledges shall benefit the
Guarantor, the Guarantor executes and delivers this Guarantee Agreement for the
benefit of the Holders from time to time.
ARTICLE I
Definitions
Section 1.1. Definitions.
For all purposes of this Guarantee Agreement, except as otherwise
expressly provided or unless the context otherwise requires:
(a) The terms defined in this Article have the meanings assigned to them in
this Article, and include the plural as well as the singular;
<PAGE>
(b) All other terms used herein that are defined in the Trust Indenture
Act, either directly or by reference therein, have the meanings assigned to them
therein;
(c) The words "include", "includes" and "including" shall be deemed to be
followed by the phrase "without limitation";
(d) All accounting terms used but not defined herein have the meanings
assigned to them in accordance with United States generally accepted accounting
principles;
(e) Unless the context otherwise requires, any reference to an "Article" or
a "Section" refers to an Article or a Section, as the case may be, of this
Guarantee Agreement; and
(f) The words "hereby", "herein", "hereof" and "hereunder" and other words
of similar import refer to this Guarantee Agreement as a whole and not to any
particular Article, Section or other subdivision.
"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.
"Board of Directors" means the board of directors of the Guarantor or the
Executive Committee of the board of directors of the Guarantor (or any other
committee of the board of directors of the Guarantor performing similar
functions) or a committee designated by the board of directors of the Guarantor
(or such committee), comprised of two or more members of the board of directors
of the Guarantor or officers of the Guarantor, or both.
"Capital Securities" has the meaning specified in the recitals to this
Guarantee Agreement.
"Common Securities" means the securities representing common undivided
beneficial interests in the assets of the Issuer Trust.
"Event of Default" means (i) a default by the Guarantor in any of its
payment obligations under this Guarantee Agreement or (ii) a default by the
Guarantor in any other obligation hereunder that remains unremedied for 30 days.
"Guarantee Agreement" means this Guarantee Agreement, as modified, amended
or supplemented from time to time.
"Guarantee Payments" means the following payments or distributions, without
duplication, with respect to the Capital Securities, to the extent not paid or
made by or on behalf of the Issuer Trust: (i) any accumulated and unpaid
Distributions (as defined in the Trust Agreement) required to be paid on the
Capital Securities, to the extent the Issuer Trust shall have funds on hand
available therefor at such time; (ii) the Redemption Price (as defined in the
Trust Agreement) with respect to any Capital Securities called for redemption by
the Issuer Trust, to the extent the Issuer Trust shall have funds on
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<PAGE>
hand available therefor at such time; and (iii) upon a voluntary or involuntary
termination, winding-up or liquidation of the Issuer Trust, unless Debentures
are distributed to the Holders, the lesser of (a) the Liquidation Distribution
(as defined in the Trust Agreement) with respect to the Capital Securities, to
the extent that the Issuer Trust shall have funds on hand available therefor at
such time and (b) the amount of assets of the Issuer Trust remaining available
for distribution to Holders on liquidation of the Issuer.
"Guarantee Trustee" means Bankers Trust Company, solely in its capacity as
Guarantee Trustee and not in its individual capacity, until a Successor
Guarantee Trustee has been appointed and has accepted such appointment pursuant
to the terms of this Guarantee Agreement, and thereafter means each such
Successor Guarantee Trustee.
"Guarantor" has the meaning specified in the first paragraph of this
Guarantee Agreement.
"Holder" means any Holder (as defined in the Trust Agreement) of any
Capital Securities; provided, however, that in determining whether the holders
of the requisite percentage of Capital Securities have given any request,
notice, consent or waiver hereunder, "Holder" shall not include the Guarantor,
the Guarantee Trustee, or any Affiliate of the Guarantor or the Guarantee
Trustee.
"Indenture" means the Junior Subordinated Indenture, dated as of ____ __,
199_, between American Express Company and Bankers Trust Company, as trustee, as
the same may be modified, amended or supplemented from time to time.
"Issuer Trust" has the meaning specified in the first paragraph of this
Guarantee Agreement.
"List of Holders" has the meaning specified in Section 2.2(a).
"Majority in Liquidation Amount of the Capital Securities" means, except as
provided by the Trust Indenture Act, Capital Securities representing more than
50% of the aggregate Liquidation Amount (as defined in the Trust Agreement) of
all Capital Securities then Outstanding (as defined in the Trust Agreement).
"Officers' Certificate" means, with respect to any Person, a certificate
signed by the Chairman or a Vice Chairman of the Board of Directors of such
Person or the President or a Vice President of such Person, and by the
Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary of
the Guarantor, and delivered to the Guarantee Trustee. Any Officers' Certificate
delivered with respect to compliance with a condition or covenant provided for
in this Guarantee Agreement shall include:
(a) a statement by each officer signing the Officers' Certificate that such
officer has read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by such officer in rendering the Officers' Certificate;
(c) a statement that such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
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<PAGE>
(d) a statement as to whether, in the opinion of such officer, 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, company,
limited liability company, trust, business trust, unincorporated association, or
government or any agency or political subdivision thereof, or any other entity
of whatever nature.
"Responsible Officer" means, with respect to the Guarantee Trustee, any
Senior Vice President, any Vice President, any Assistant Vice President, the
Secretary, any Assistant Secretary, the Treasurer, any Assistant Treasurer, any
Trust Officer or Assistant Trust Officer or any officer assigned to the
Corporate Trust Office, including any managing director, vice president,
assistant vice president, assistant treasurer or assistant secretary of the
Guarantee Trustee and also means, with respect to a particular 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 Agreement" means the Amended and Restated Trust Agreement of the
Issuer Trust referred to in the recitals to this Guarantee Agreement, as
modified, amended or supplemented from time to time.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as in force at
the date as of which this Guarantee Agreement 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.
"Vice President", when used with respect to the Corporation, means any duly
appointed vice president, whether or not designated by a number or a word or
words added before or after the title "vice president."
ARTICLE II
Trust Indenture Act
Section 2.1. Trust Indenture Act; Application.
(a) This Guarantee Agreement is subject to the provisions of the Trust
Indenture Act that are required to be part of this Guarantee Agreement and
shall, to the extent applicable, be governed by such provisions.
(b) If and to the extent that any provision of this Guarantee Agreement
limits, qualifies or conflicts with the duties imposed by Sections 310 to 317,
inclusive, of the Trust Indenture Act through operation of Section 318(c)
thereof, such imposed duties shall control. If any provision of this Guarantee
Agreement modifies or excludes any provision of the Trust Indenture Act which
may be so
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<PAGE>
modified or excluded, the latter provision shall be deemed to apply to
this Guarantee Agreement as so modified or to be excluded, as the case may be.
Section 2.2. List of Holders.
(a) The Guarantor shall furnish or cause to be furnished to the Guarantee
Trustee (a) semiannually, on or before June 30 and December 31 of each year, a
list, in such form as the Guarantee Trustee may reasonably require, of the names
and addresses of the Holders (a "List of Holders") as of a date not more than 15
days prior to the delivery thereof, and (b) at such other times as the Guarantee
Trustee may request in writing, within 30 days after the receipt by the
Guarantor of any such request, a List of Holders as of a date not more than 15
days prior to the time such list is furnished, in each case to the extent such
information is in the possession or control of the Guarantor and has not
otherwise been received by the Guarantee Trustee in its capacity as such. The
Guarantee Trustee 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 the requirements of Section
311(a), Section 311(b) and Section 312(b) of the Trust Indenture Act.
Section 2.3. Reports by the Guarantee Trustee.
Not later than May 1 of each year, commencing May 1, 1999, the Guarantee
Trustee shall provide to the Holders 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 the Guarantee Trustee.
The Guarantor shall provide to the Guarantee Trustee, the Securities and
Exchange Commission and the Holders such documents, reports and information, if
any, as required by Section 314 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 such conditions precedent, if any, provided for in this
Guarantee Agreement 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 of the Guarantor pursuant to Section 314(c)(1) may be given
in the form of an Officers' Certificate.
Section 2.6. Events of Default; Waiver.
The Holders of at least a Majority in Liquidation Amount of the Capital
Securities may, by vote, on behalf of the Holders of all the Capital Securities,
waive any past default or Event of Default and its consequences. Upon such
waiver, any such default or Event of Default shall cease to exist, and any
default or Event of Default arising therefrom shall be deemed to have been
cured, for every
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<PAGE>
purpose of this Guarantee Agreement, but no such waiver shall extend to any
subsequent or other default or Event of Default or impair any right consequent
thereon.
Section 2.7. Event of Default; Notice.
(a) The Guarantee Trustee shall, within 90 days after the occurrence of an
Event of Default known to a Responsible Officer of the Guarantee Trustee,
transmit by mail, first class postage prepaid, to the Holders, notice of any
such Event of Default, unless such Event of Default has been cured before the
giving of such notice, provided that, except in the case of a default in the
payment of a Guarantee Payment, the Guarantee 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
Guarantee Trustee in good faith determines that the withholding of such notice
is in the interests of the Holders.
(b) The Guarantee Trustee shall not be deemed to have knowledge of any
Event of Default unless the Guarantee Trustee shall have received written
notice, or a Responsible Officer charged with the administration of this
Guarantee Agreement shall have obtained actual knowledge, of such Event of
Default.
Section 2.8. Conflicting Interests.
The Trust Agreement and the Indenture shall be deemed to be specifically
described in this Guarantee Agreement for the purposes of clause (i) of the
first proviso contained in Section 310(b) of the Trust Indenture Act.
ARTICLE III
Powers, Duties and Rights of the Guarantee Trustee
Section 3.1. Powers and Duties of the Guarantee Trustee.
(a) This Guarantee Agreement shall be held by the Guarantee Trustee for the
benefit of the Holders, and the Guarantee Trustee shall not transfer this
Guarantee Agreement to any Person except to a Successor Guarantee Trustee on
acceptance by such Successor Guarantee Trustee of its appointment to act as
Guarantee Trustee hereunder. The right, title and interest of the Guarantee
Trustee, as such, hereunder shall automatically vest in any Successor Guarantee
Trustee, upon acceptance by such Successor Guarantee Trustee of its appointment
hereunder, and such vesting and cessation of title shall be effective whether or
not conveyancing documents have been executed and delivered pursuant to the
appointment of such Successor Guarantee Trustee.
(b) If an Event of Default has occurred and is continuing, the Guarantee
Trustee shall enforce this Guarantee Agreement for the benefit of the Holders.
(c) The Guarantee Trustee, before the occurrence of any Event of Default
and after the curing of all Events of Default that may have occurred, shall
undertake to perform only such duties as are specifically set forth in this
Guarantee Agreement, and no implied covenants shall be read into this
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<PAGE>
Guarantee Agreement against the Guarantee Trustee. If an Event of Default has
occurred (that has not been cured or waived pursuant to Section 2.6), the
Guarantee Trustee shall exercise such of the rights and powers vested in it by
this Guarantee Agreement, 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 Agreement shall be construed to relieve
the Guarantee Trustee from liability for its own negligent action, its own
negligent failure to act or its own wilful misconduct, except that:
(i) Prior to the occurrence of any Event of Default and after the
curing or waiving of all such Events of Default that may have occurred:
(A) the duties and obligations of the Guarantee Trustee shall be
determined solely by the express provisions of this Guarantee
Agreement (including pursuant to Section 2.1), 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
Agreement; 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
Agreement; but in the case of any such certificates or opinions that
by any provision hereof or of the Trust Indenture Act 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 Agreement.
(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.
(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 written direction of the Holders of not less than a Majority in
Liquidation Amount of the Capital Securities relating to the time, method
and place of conducting any proceeding for any remedy available to the
Guarantee Trustee, or exercising any trust or power conferred upon the
Guarantee Trustee under this Guarantee Agreement.
(iv) Subject to Section 3.1(b), no provision of this Guarantee
Agreement 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 Agreement or adequate indemnity against such
risk or liability is not reasonably assured to it.
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<PAGE>
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 reasonably 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 Agreement shall be sufficiently evidenced by an Officers'
Certificate unless otherwise prescribed herein.
(iii) Whenever, in the administration of this Guarantee Agreement, the
Guarantee Trustee shall deem it desirable that a matter be proved or
established before taking, suffering or omitting to take any action
hereunder, the Guarantee Trustee (unless other evidence is herein
specifically prescribed) may, in the absence of bad faith on its part,
request and conclusively rely upon an Officers' Certificate which, upon
receipt of such request from the Guarantee Trustee, shall be promptly
delivered by the Guarantor.
(iv) The Guarantee Trustee may consult with legal counsel, and the
written advice or opinion of such legal counsel with respect to legal
matters shall be full and complete authorization and protection in respect
of any action taken, suffered or omitted to be taken by it hereunder in
good faith and in accordance with such advice or opinion. Such legal
counsel may be legal counsel to the Guarantor or any of its Affiliates and
may be one of its employees. The Guarantee Trustee shall have the right at
any time to seek instructions concerning the administration of this
Guarantee Agreement from any court of competent jurisdiction.
(v) The Guarantee Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Guarantee Agreement at the
request or direction of any Holder unless such Holder shall have provided
to the Guarantee Trustee such adequate security and indemnity as would
satisfy a reasonable person in the position of the Guarantee Trustee
against the costs, expenses (including attorneys' fees and expenses) 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)(v) shall be taken to relieve the Guarantee Trustee, upon the
occurrence of an Event of Default, of its obligation to exercise the rights
and powers vested in it by this Guarantee Agreement.
(vi) 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.
(vii) The Guarantee Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
its agents, attorneys, custodians or nominees and the
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<PAGE>
Guarantee Trustee shall not be responsible for any misconduct or negligence
on the part of any such agent, attorney, custodian or nominee appointed by
it with due care hereunder.
(viii) Whenever in the administration of this Guarantee Agreement 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 (A) may request instructions from the
Holders, (B) may refrain from enforcing such remedy or right or taking such
other action until such instructions are received, and (C) shall be fully
protected in acting in accordance with such instructions.
(b) No provision of this Guarantee Agreement 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 to act in accordance with such power and
authority.
Section 3.3. Compensation; Indemnity; Fees.
The Guarantor agrees:
(a) to pay to the Guarantee Trustee from time to time such reasonable
compensation for all services rendered by it hereunder as may be agreed by
the Guarantor and the Guarantee Trustee from time to time (which
compensation shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust);
(b) except as otherwise expressly provided herein, to reimburse the
Guarantee Trustee upon request for all reasonable expenses, disbursements
and advances incurred or made by the Guarantee Trustee in accordance with
any provision of this Guarantee Agreement (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
(c) to indemnify the Guarantee Trustee and its officers, directors and
employees for, and to hold it harmless against, any loss, liability or
expense incurred without negligence, wilful misconduct or bad faith on the
part of the Guarantee Trustee, arising out of or in connection with the
acceptance or administration of this Guarantee Agreement, 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 Guarantee Trustee will not claim or exact any lien or charge on any
Guarantee Payments as a result of any amount due to it under this Guarantee
Agreement. The Guarantor's indemnification obligations as set forth in this
Section 3.3 shall survive the termination of this Guarantee Agreement or the
resignation or removal of the Guarantee Trustee.
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<PAGE>
ARTICLE IV
Guarantee Trustee
Section 4.1. Guarantee Trustee; Eligibility.
(a) There shall at all times be a Guarantee Trustee which shall:
(i) not be an Affiliate of the Guarantor; and
(ii) 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 shall be a corporation meeting the requirements of Section
310(a) of the Trust Indenture Act. If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of its
supervising or examining authority, then, for the purposes of this Section
4.1 and to the extent permitted by the Trust Indenture Act, the combined
capital and surplus of such corporation shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published.
(b) If at any time the Guarantee Trustee shall cease to be eligible to so
act under Section 4.1(a), the Guarantee Trustee shall immediately resign in the
manner and with the effect set out in Section 4.2.
(c) If the Guarantee Trustee has or shall acquire any "conflicting
interest" within the meaning of Section 310(b) of the Trust Indenture Act, the
Guarantee Trustee and Guarantor shall in all respects comply with the provisions
of Section 310(b) of the Trust Indenture Act.
Section 4.2. Appointment, Removal and Resignation of the Guarantee Trustee.
(a) Subject to Section 4.2(c), the Guarantee Trustee may be appointed or
removed at any time by the action of the Holders of a Majority in Liquidation
Amount of the Capital Securities delivered to the Guarantee Trustee and the
Guarantor (i) for cause or (ii) if a Debenture Event of Default (as defined in
the Trust Agreement) shall have occurred and be continuing at any time.
(b) Subject to Section 4.2(c), the Guarantee Trustee may resign from office
(without need for prior or subsequent accounting) by giving written notice
thereof to the Holders and the Guarantor and by appointing a successor Guarantee
Trustee. The Guarantee Trustee shall appoint a successor by requesting from at
least three Persons meeting the requirements of Section 4.1(a) their expenses
and charges to serve as the Guarantee Trustee, and selecting the Person who
agrees to the lowest expenses and charges.
(c) The Guarantee Trustee appointed hereunder shall hold office until a
Successor Guarantee Trustee shall have been appointed and shall have accepted
such appointment. No removal or resignation of a Guarantee Trustee shall be
effective until a Successor Guarantee Trustee has been appointed and has
accepted such appointment by written instrument executed by such Successor
Guarantee Trustee and delivered to the Guarantor and, in the case of any
resignation, the resigning Guarantee Trustee.
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<PAGE>
(d) If no Successor Guarantee Trustee shall have been appointed and
accepted appointment as provided in this Section 4.2 within 60 days after
delivery to the Holders and the Guarantor of a notice of resignation, the
resigning Guarantee Trustee may petition, at the expense of the Guarantor, any
court of competent jurisdiction for appointment of a Successor Guarantee
Trustee. Such court may thereupon, after prescribing such notice, if any, as it
may deem proper, appoint a Successor Guarantee Trustee.
(e) If a resigning Guarantee Trustee shall fail to appoint a successor, or
if a Guarantee Trustee shall be removed or become incapable of acting as
Guarantee Trustee and a replacement shall not be appointed prior to such
resignation or removal, or if a vacancy shall occur in the office of Guarantee
Trustee for any cause, the Holders of the Capital Securities, by the action of
the Holders of record of not less than 25% in aggregate Liquidation Amount (as
defined in the Trust Agreement) of the Capital Securities then Outstanding (as
defined in the Trust Agreement) delivered to such Guarantee Trustee, may appoint
a Successor Guarantee Trustee or Trustees. If no successor Guarantee Trustee
shall have been so appointed by the Holders of the Capital Securities and
accepted appointment, any Holder, on behalf of such Holder and all others
similarly situated, or any other Guarantee Trustee, may petition any court of
competent jurisdiction for the appointment of a successor Guarantee Trustee.
ARTICLE V
Guarantee
Section 5.1. Guarantee.
The Guarantor irrevocably and unconditionally agrees to pay in full to the
Holders the Guarantee Payments (without duplication of amounts theretofore paid
by or on behalf of the Issuer Trust), as and when due, regardless of any
defense, right of set-off or counterclaim that the Issuer Trust may have or
assert, except the defense of payment. The Guarantor's obligation to make a
Guarantee Payment may be satisfied by direct payment of the required amounts by
the Guarantor to the Holders or by causing the Issuer 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
Agreement and of any liability to which it applies or may apply, presentment,
demand for payment, any right to require a proceeding first against the
Guarantee Trustee, the Issuer 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.
Section 5.3. Obligations Not Affected.
The obligations, covenants, agreements and duties of the Guarantor under
this Guarantee Agreement shall in no way be affected or impaired by reason of
the happening from time to time of any of the following:
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<PAGE>
(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Issuer Trust of any express or implied
agreement, covenant, term or condition relating to the Capital Securities
to be performed or observed by the Issuer Trust;
(b) the extension of time for the payment by the Issuer Trust of all
or any portion of the Distributions (other than an extension of time for
payment of Distributions that results from the extension of any interest
payment period on the Debentures as provided in the Indenture), Redemption
Price, Liquidation Distribution or any other sums payable under the terms
of the Capital Securities or the extension of time for the performance of
any other obligation under, arising out of, or in connection with, the
Capital Securities;
(c) any failure, omission, delay or lack of diligence on the part of
the Holders to enforce, assert or exercise any right, privilege, power or
remedy conferred on the Holders pursuant to the terms of the Capital
Securities, or any action on the part of the Issuer Trust granting
indulgence or extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution,
receivership, insolvency, bankruptcy, assignment for the benefit of
creditors, reorganization, arrangement, composition or readjustment of debt
of, or other similar proceedings affecting, the Issuer Trust or any of the
assets of the Issuer Trust;
(e) any invalidity of, or defect or deficiency in, the Capital
Securities;
(f) the settlement or compromise of any obligation guaranteed hereby
or hereby incurred; or
(g) any other circumstance whatsoever that might otherwise constitute
a legal or equitable discharge or defense of a guarantor (other than
payment of the underlying obligation), 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 Holders to give notice to, or obtain the
consent of, the Guarantor with respect to the happening of any of the foregoing.
Section 5.4. Rights of Holders.
The Guarantor expressly acknowledges that: (i) this Guarantee Agreement
will be deposited with the Guarantee Trustee to be held for the benefit of the
Holders; (ii) the Guarantee Trustee has the right to enforce this Guarantee
Agreement on behalf of the Holders; (iii) 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
Guarantee Trustee in respect of this Guarantee Agreement or exercising any trust
or power conferred upon the Guarantee Trustee under this Guarantee Agreement;
and (iv) any Holder may institute a legal proceeding directly against the
Guarantor to enforce its rights under this Guarantee Agreement without first
instituting a legal proceeding against the Guarantee Trustee, the Issuer Trust
or any other Person.
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<PAGE>
Section 5.5. Guarantee of Payment.
This Guarantee Agreement creates a guarantee of payment and not of
collection. This Guarantee Agreement will not be discharged except by payment of
the Guarantee Payments in full (without duplication of amounts theretofore paid
by the Issuer Trust) or upon the distribution of Debentures to Holders as
provided in the Trust Agreement.
Section 5.6. Subrogation.
The Guarantor shall be subrogated to all rights (if any) of the Holders
against the Issuer Trust in respect of any amounts paid to the Holders by the
Guarantor under this Guarantee Agreement; provided, however, that the Guarantor
shall not (except to the extent required by mandatory provisions of law) be
entitled to enforce or exercise any rights which it may acquire by way of
subrogation or any indemnity, reimbursement or other agreement, in all cases as
a result of payment under this Guarantee Agreement, if, at the time of any such
payment, any amounts are due and unpaid under this Guarantee Agreement. If any
amount shall be paid to the Guarantor in violation of the preceding sentence,
the Guarantor agrees to hold such amount in trust for the Holders and to pay
over such amount to the Holders.
Section 5.7. Independent Obligations.
The Guarantor acknowledges that its obligations hereunder are independent
of the obligations of the Issuer Trust with respect to the Capital Securities
and that the Guarantor shall be liable as principal and as debtor hereunder to
make Guarantee Payments pursuant to the terms of this Guarantee Agreement
notwithstanding the occurrence of any event referred to in subsections (a)
through (g), inclusive, of Section 5.3 hereof.
ARTICLE VI
Covenants and Subordination
Section 6.1. Subordination.
The obligations of the Guarantor under this Guarantee Agreement will
constitute unsecured obligations of the Guarantor and will rank subordinate and
junior in right of payment to all Senior Indebtedness (as defined in the
Indenture) of the Guarantor to the extent and in the manner set forth in the
Indenture with respect to the Debentures, and the provisions of Article XIII of
the Indenture will apply, mutatis mutandis, to the obligations of the Guarantor
hereunder. The obligations of the Guarantor hereunder do not constitute Senior
Indebtedness (as defined in the Indenture) of the Guarantor.
Section 6.2. Pari Passu Guarantees.
The obligations of the Guarantor under this Guarantee Agreement shall rank
pari passu with the obligations of the Guarantor under (i) any similar guarantee
agreements issued by the Guarantor on behalf of the holders of preferred or
capital securities issued by the Issuer Trust (as defined in the
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<PAGE>
Indenture), (ii) the Indenture and the Securities (as defined therein) issued
thereunder; (iii) the Expense Agreement (as defined in the Trust Agreement) and
(iv) any other security, guarantee or other agreement or obligation that is
expressly stated to rank pari passu with the obligations of the Guarantor under
this Guarantee Agreement or with any obligation that ranks pari passu with the
obligations of the Guarantor under this Guarantee Agreement.
ARTICLE VII
Termination
Section 7.1. Termination.
This Guarantee Agreement shall terminate and be of no further force and
effect upon (i) full payment of the Redemption Price (as defined in the Trust
Agreement) of all Capital Securities, (ii) the distribution of Debentures to the
Holders in exchange for all of the Capital Securities or (iii) full payment of
the amounts payable in accordance with Article IX of the Trust Agreement upon
liquidation of the Issuer Trust. Notwithstanding the foregoing, this Guarantee
Agreement will continue to be effective or will be reinstated, as the case may
be, if at any time any Holder is required to repay any sums paid with respect to
Capital Securities or this Guarantee Agreement.
ARTICLE VIII
Miscellaneous
Section 8.1. Successors and Assigns.
All guarantees and agreements contained in this Guarantee Agreement shall
bind the successors, assigns, receivers, trustees and representatives of the
Guarantor and shall inure to the benefit of the Holders of the Capital
Securities then outstanding. Except in connection with a consolidation, merger
or sale involving the Guarantor that is permitted under Article VIII of the
Indenture and pursuant to which the successor or assignee agrees in writing to
perform the Guarantor's obligations hereunder, the Guarantor shall not assign
its obligations hereunder, and any purported assignment other than in accordance
with this provision shall be void.
Section 8.2. Amendments.
Except with respect to any changes that do not adversely affect the rights
of the Holders in any material respect (in which case no consent of the Holders
will be required), this Guarantee Agreement may only be amended with the prior
approval of the Holders of not less than a Majority in Liquidation Amount of the
Capital Securities. The provisions of Article VI of the Trust Agreement
concerning meetings of the Holders shall apply to the giving of such approval.
-14-
<PAGE>
Section 8.3. Notices.
Any notice, request or other communication required or permitted to be
given hereunder shall be in writing, duly signed by the party giving such
notice, and delivered, telecopied or mailed by first class mail as follows:
(a) if given to the Guarantor, to the address or telecopy number set forth
below or such other address or telecopy number as the Guarantor may give notice
to the Guarantee Trustee and the Holders:
American Express Company
World Financial Center
200 Vesey Street
New York, New York 10285
Attention: Secretary
Telecopy: ________________
(b) if given to the Guarantee Trustee, at the address or telecopy number
set forth below or such other address or telecopy number as the Guarantee
Trustee may give notice to the Guarantor and Holders:
Bankers Trust Company
Four Albany Street, Fourth Floor
New York, New York 10006
Attention: Corporate Trust and Agency Group
Telecopy: (212) 250-6392/6961
with a copy to:
American Express Company Capital Trust I
c/o American Express Company
World Financial Center
200 Vesey Street
New York, New York 10285
Attention: Secretary
Telecopy: ____________
(c) if given to any Holder, at the address set forth on the books and
records of the Issuer Trust.
All notices hereunder 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 8.4. Benefit.
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<PAGE>
This Guarantee Agreement is solely for the benefit of the Holders and is
not separately transferable from the Capital Securities.
Section 8.5. Governing Law.
THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK.
Section 8.6. Counterparts.
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.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Guarantee
Agreement as of the day and year first above written.
American Express Company
By:
---------------------------------
Name:
Title:
Bankers Trust Company,
as Guarantee Trustee
By:
---------------------------------
Name:
Title:
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<PAGE>
EXHIBIT 5.1
June 1, 1998
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 10549
Ladies and Gentlemen:
I am the Executive Vice President and General Counsel of American
Express Company, A New York corporation (the "Corporation"), and, in that
capacity, have acted as counsel for the Corporation in connection with the
preparation of a Registration Statement on Form S-3 (the "Registration
Statement") relating to $500,000,000 principal amount of Junior Subordinated
Deferrable Interest Debentures (the "Debt Securities") of the Corporation,
$500,000,000 aggregate liquidation amount of Capital Securities (the "Capital
Securities"), of American Express Company Capital Trust I and American Express
Company Capital Trust II, each of which is a Delaware statutory business trust
(each, a "Trust"), and the Guarantees with respect to the Capital Securities
(the "Guarantees") to be executed and delivered by the Corporation for the
benefit of the holders from time to time of the Capital Securities. This opinion
is being furnished pursuant to the requirements of Form S=3 and Item 601 of
Regulation S-K under the Securities Act of 1993, as amended.
In furnishing this opinion, I, or attorneys under my supervision, have
examined (i) the Registration Statement, as well as the prospectus included
therein (the "Prospectus"), filed with the Securities and Exchange Commission,
in connection with which this opinion is to be filed as an Exhibit, (ii) the
Indenture with respect to the Debt Securities, (iii) the forms of the Guarantee
Agreements under which the Guarantees will be created, (iv) the forms of the
Amended and Restated Trust Agreements of the Trusts and (v) such other
documents, legal opinions and precedents, corporate and other records of the
Corporation and certificates of public officials and officers of the Corporation
as I have deemed necessary or appropriate to provide a basis for the opinions
set forth herein. In such examination, I have assumed the genuineness of all
signatures, the authenticity of all documents submitted to me as originals and
the conformity to original documents of all documents submitted to me as
certified or photostatic copies.
Based upon the foregoing I am of the opinion that:
<PAGE>
1. The Corporation has been duly incorporated and is validly existing
as a corporation under the laws of the State of New York;
2. The Registration Statement has been duly authorized by all necessary
corporate action of the Corporation;
3. When;
(i) the Registration Statement relating to the Debt Securities,
the Capital Securities and the Guarantees has become effective under the Act;
(ii) the Guarantee Agreement relating to the Guarantee with
respect to the Capital Securities of a Trust has been duly executed and
delivered;
(iii) The Amended and Restated Trust Agreement of such Trust has
been duly executed and delivered;
(iv) the terms of the Debt Securities and of their issuance and
sale have been duly established in conformity with the Indenture so as not to
violate any applicable law or result in a default under or breach of any
agreement or instrument binding upon the Corporation and so as to comply with
any requirement or restriction imposed by any court or government body having
jurisdiction over the Corporation;
(v) the terms of the Capital Securities of such Trust and of
their issuance and sale have been duly established in conformity with the
Amended and Restated Trust Agreement of such Trust so as not to violate any
applicable law or result in a default under or breach of any agreement or
instrument binding upon such Trust and so as to comply with any requirement or
restriction imposed by any court or government body having jurisdiction over
such Trust;
(vi) the Debt Securities have been duly executed and
authenticated in accordance with the Indenture and issued and sold as
contemplated in the Registration Statement; and
(vii) the Capital Securities have been duly executed and
authenticated in accordance with the Amended and Restated Agreement of such
Trust and issued
<PAGE>
and sold as contemplated in the Registration Statement,
the Debt Securities and the Guarantee relating to the Capital Securities of such
Trust will constitute valid and legally binding obligations of the Corporation,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles.
The foregoing opinion is limited to the Federal laws of the United
States and the laws of the State of New York, and I am expressing no opinion as
to the effect of the laws of any other jurisdiction.
I hereby consent to the filing of this opinion as an Exhibit to the
Registration Statement and to the use of my name in each of the Prospectus and
Prospectus Supplement therein under the heading "Validity of Securities". By
giving such consent, I do not thereby admit that I am within the category of
persons whose consents are required under Section 7 of the Securities Act of
1933, as amended.
Very truly yours,
/s/ Louise M. Parent
Louise M. Parent
Executive Vice President
and General Counsel
<PAGE>
EXHIBIT 5.2
[LETTERHEAD OF RICHARDS, LAYTON & FINGER, P.A.]
June 1, 1998
American Express Company Capital Trust I
c/o American Express Company
200 Vesey Street
New York, New York 10285
Re: American Express Company Capital Trust I
----------------------------------------
Ladies and Gentlemen:
We have acted as special Delaware counsel for American Express Company,
a New York corporation (the "Company"), and American Express Company Capital
Trust 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 May 29, 1998
(the "Certificate"), as filed in the office of the Secretary of State of the
State of Delaware (the "Secretary of State") on May 29, 1998;
(b) The Trust Agreement of the Trust, dated as of May 29, 1998,
between the Company, as depositor, and Bankers Trust (Delaware), as trustee;
(c) The registration statement on Form S-3, including a related
preliminary prospectus, as supplemented by a preliminary prospectus supplement
(as supplemented, the "Prospectus"), relating to the Capital Securities of the
Trust representing undivided beneficial interests in the assets of the Trust
(each, a "Capital Security" and
<PAGE>
American Express Company Capital Trust I
June 1, 1998
Page 2
collectively, the "Capital Securities"), as proposed to be filed by the Company,
the Trust and the other registrants listed therein with the Securities and
Exchange Commission (the "SEC") on or about June 1, 1998 (the "Registration
Statement");
(d) A form of Amended and Restated Trust Agreement of the Trust, to
be entered into among the Company, as depositor, the trustees of the Trust named
therein, the Administrators and the several holders, from time to time, of
undivided beneficial interests in the assets of the Trust, attached as an
exhibit to the Prospectus (the "Trust Agreement"); and
(e) A Certificate of Good Standing for the Trust, dated June 1,
1998, 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 Capital Security is to
<PAGE>
American Express Company Capital Trust I
June 1, 1998
Page 3
be issued by the Trust (collectively, the "Capital Security Holders") of a
Capital Securities Certificate for such Capital Security and the payment for
the Capital Security acquired by it, in accordance with the Trust Agreement and
the Registration Statement, and (vii) that the Capital Securities are issued
and sold to the Capital Security Holders in accordance with the Trust Agreement
and the Registration Statement. We have not participated in the preparation of
the Registration Statement and assume no responsibility for its contents.
This opinion is limited to the laws of the State of Delaware (excluding
the securities laws of the State of Delaware), ad 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 Delaware Business Trust Act, 12 Del. C SS
------
3801, et seq.
------
2. When issued and sold, the Capital Securities will represent
valid and, subject to the qualifications set forth in paragraph 3 below, fully
paid and nonassessable undivided beneficial interest in the asset of the Trust.
3. The Capital Security Holders, as beneficial owners of the Trust,
will be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the
General Corporation Law of the State of Delaware. We note that the Capital
Security Holders may be obligated to make payments as set forth in the Trust
Agreement.
<PAGE>
American Express Company Capital Trust I
June 1, 1998
Page 4
We consent to the filing of this opinion with the SEC as an exhibit to
the Registration Statement. In addition, we hereby consent to the use of our
name under the heading "Validity of Securities" 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 SEC thereunder. Except as stated
above, without our prior written consent, this opinion may not be furnished or
quoted to, or relied upon by, any other Person for any purpose.
Very truly yours,
/s/ Richards, Layton & Finger, P.A.
<PAGE>
EXHIBIT 5.3
[LETTERHEAD OF RICHARDS, LAYTON & FINGER, P.A.]
June 1, 1998
American Express Company Capital Trust II
c/o American Express Company
200 Vesey Street
New York, New York 10285
Re: American Express Company Capital Trust II
-----------------------------------------
Ladies and Gentlemen:
We have acted as special Delaware counsel for American Express Company,
a New York corporation (the "Company"), and American Express Company Capital
Trust II, 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 May 29, 1998
(the "Certificate"), as filed in the office of the Secretary of State of the
State of Delaware (the "Secretary of State") on May 29, 1998;
(b) The Trust Agreement of the Trust, dated as of May 29, 1998, between
the Company, as depositor, and Bankers Trust (Delaware), as trustee;
(c) The registration statement on Form S-3, including a related
preliminary prospectus, as supplemented by a preliminary prospectus supplement
(as supplemented, the "Prospectus"), relating to the Capital Securities of the
Trust representing undivided beneficial interests in the assets of the Trust
(each, a "Capital Security" and
<PAGE>
American Express Company Capital Trust II
June 1, 1998
Page 2
collectively, the "Capital Securities"), as proposed to be filed by the Company,
the Trust and the other registrants listed therein with the Securities and
Exchange Commission (the "SEC") on or about June 1, 1998 (the "Registration
Statement");
(d) A form of Amended and Restated Trust Agreement of the Trust, to be
entered into among the Company, as depositor, the trustees of the Trust named
therein, the Administrators and the several holders, from time to time, of
undivided beneficial interests in the assets of the Trust, attached as an
exhibit to the Prospectus (the "Trust Agreement"); and
(e) A Certificate of Good Standing for the Trust, dated June 1, 1998,
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 Capital Security is to
<PAGE>
American Express Company Capital Trust II
June 1, 1998
Page 3
be issued by the Trust (collectively, the "Capital Security Holders") of a
Capital Securities Certificate for such Capital Security and the payment for the
Capital Security acquired by it, in accordance with the Trust Agreement and the
Registration Statement, and (vii) that the Capital Securities are issued and
sold to the Capital Security Holders in accordance with the Trust Agreement and
the Registration Statement. We have not participated in the preparation of the
Registration Statement and assume no responsibility for its contents.
This opinion is limited to the laws of the State of Delaware (excluding
the securities laws of the State of Delaware), and we have not considered and
express no opinion on the laws of any other jurisdiction, including federal laws
and rules and regulations relating thereto. Our opinions are rendered only with
respect to Delaware laws and rules, regulations and orders thereunder 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 Delaware Business Trust Act, 12 Del. C.
-------
/S/ 3801, et scq.
------
2. When issued and sold, the 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 Capital Security Holders, as beneficial owners of the Trust,
will be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporate Law of the State of Delaware. We note that the Capital Security
Holders may be obligated to make payments as set forth in the Trust Agreement.
<PAGE>
American Express Company Capital Trust II
June 1, 1998
Page 4
We consent to the filing of this opinion with the SEC as an exhibit to
the Registration Statement. In addition, we hereby consent to the use of our
name under the heading "Validity of Securities" 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 SEC thereunder. Except as
stated above, without our prior written consent, this opinion may not be
furnished or quoted to, or relied upon by, any other Person for any purpose.
Very truly yours,
/s/ Richards, Layton & Finger, P.A.
<PAGE>
Writer's Direct Dial: (212) 225-2980
June 1, 1998
American Express Company
American Express Company Capital Trust I
American Express Company Capital Trust II
c/o American Express Company
World Financial Center
200 Vesey Street
New York, NY 10285
Ladies and Gentlemen:
We have acted as special tax counsel to American Express Company, a New
York corporation (the "Company"), American Express Company Capital Trust I and
American Express Company Capital Trust Company II, each a statutory business
trust formed under the laws of the State of Delaware (and, together, the
"Trusts"), in connection with preparation and filing with the Securities and
Exchange Commission (the "Commission") of a Registration Statement on Form S-3
dated the date hereof (the "Registration Statement") relating to $500,000,000 in
aggregate principal amount of Junior Subordinated Debentures of the Company (the
"Junior Subordinated Debentures"), $500,000,000 in aggregate liquidation amount
of capital securities of the Trusts guaranteed by the Company (the "Capital
Securities") and the guarantees with respect to the Capital Securities (the
"Guarantees") to be executed and delivered by the Corporation for the benefit of
the holders from time to time of the Capital Securities.
In arriving at the opinions expressed below we have examined an executed
copy of the Registration Statement dated the date hereof, which you have
provided us, as well as the forms of (i) the Amended and Restated Trust
Agreement of each of the Trusts (the "Trust
<PAGE>
Agreement"), (ii) the Indenture relating to the issuance of the Junior
Subordinated Debentures (the "Indenture") and (iii) the Guarantee Agreement
relating to the Guarantees, each of which is filed as an exhibit to the
Registration Statement. We have also examined such other documents relating to
the issuance of the Junior subordinated Debentures, the Capital Securities and
the Guarantees described in the prospectus and prospectus supplement which form
a part of the Registration Statement (the Trust Agreement, the Indenture, the
Guarantee and such other documents being referred to herein as the "Operative
Documents"). In addition, we have made such investigations of law as we have
deemed appropriate as a basis for the opinion expressed below.
Subject to the assumptions, qualifications, and conditions set forth
herein and in the discussion set forth in the Registration Statement under the
caption "U.S. Federal Income Tax Consequences" and accuracy of certain
representations of the Company and the Trusts it is our opinion that:
1. Under current law and assuming the performance of the Operative
Documents in accordance with the terms described therein, the Junior
Subordinated Debentures will be treated for United States federal income tax
purposes as indebtedness of the Company.
2. Under current law and assuming the performance of the Operative
Documents in accordance with the terms described therein, the Trusts will be
treated for United States federal income tax purposes as grantor trusts and not
as associations taxable as a corporations.
Our opinion is based on the U.S. Internal Revenue Code of 1986, as
amended, Treasury regulations promulgated thereunder, and administrative and
judicial interpretations thereof, all as of the date hereof and all of which are
subject to change, possibly on a retroactive basis. In rendering this opinion,
we are expressing our views only as to the federal income tax laws of the United
States of America.
We are furnishing this letter to you solely for your benefit in
connection with the offering of the Capital Securities. This letter is not to be
used, circulated, quoted or otherwise referred to for any other purpose.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement, and to the use of our name under the headings "U.S.
Federal Income Tax Consequences" and "Validity of Securities" in the
Registration Statement. By giving such consent, we do not admit that we are
"experts" within the meaning of the Securities Act of 1933, as amended, or the
rules and regulations of the Commission issued thereunder with respect to any
part of the Registration Statement, including this exhibit.
<PAGE>
Very truly yours,
CLEARY, GOTTLIEB, STEEN & HAMILTON
By /s/ Erika W. Nijenhuis
----------------------------------
Erika W. Nijenhuis, a Partner
<PAGE>
EXHIBIT 15.1
May 29, 1998
The Shareholders and Board of Directors
American Express Company
We are aware of the incorporation by reference in the Registration Statement on
Form S-3 and related Prospectus of American Express Company (the "Company"),
American Express Company Capital Trust I and American Express Company Capital
Trust II for the registration of $500 million of Junior Subordinated Deferrable
Interest Debentures of the Company and Capital Securities of American Express
Company Capital Trust I and American Express Company Capital Trust II guaranteed
by the Company of our report dated May 14, 1998, relating to the unaudited
consolidated interim financial statements of the Company which are included in
its Form 10-Q for the quarter ended March 31, 1998.
Pursuant to Rule 436(c) of the Securities Act of 1933, our report is not a part
of the Registration Statement prepared or certified by accountants within the
meaning of Section 7 or 11 of the Securities Act of 1933.
New York, New York /s/ Ernst & Young LLP
May 29, 1998
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement of Form S-3 and related Prospectus of American Express
Company (the "Company"), American Express Company Capital Trust I and American
Express Company Capital Trust II for the registration of $500 million of Junior
Subordinated Deferrable Interest Debentures of the Company and Capital
Securities of American Express Company Capital Trust I and American Express
Company Capital Trust II guaranteed by the Company and to the incorporation by
reference therein of our report dated February 5, 1998 with respect to the
consolidated financial statements and schedules of the Company incorporated by
reference in the Company's Annual Report on Form 10-K for the year ended
December 31, 1997, filed with the Securities and Exchange Commission.
New York, New York /s/ Ernst & Young LLP
May 29, 1998
<PAGE>
EXHIBIT 24.1
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Richard Karl Goeltz, Stephen P. Norman and Louise
M. Parent and each of them severally, his or her true and lawful attorney-in-
fact, with power to act with or without each other and with power of
substitution and resubstitution, to execute in his or her name, place and stead
in capacity as a director or officer of American Express Company, a Registration
Statement with respect to the registration of $500,000,000 aggregate principal
amount of debt securities ("Debt Securities") of the Company to be issued
directly by the Company or in the form of capital securities ("Capital
Securities") to be issued by trusts for which the Company will be the depositor
and the principal asset of which is a Debt Security and a guarantee of the
Company with respect to the Capital Securities, any and all amendments to such
Registration Statement, with exhibits thereto and all instruments necessary or
incidental in connection therewith, and to file the same with the Securities and
Exchange Commission, hereby ratifying and confirming all that each of said
attorneys-in-fact, or their substitutes, may do or cause to be done by virtue
hereof.
This Power of Attorney may be executed in counterparts.
IN WITNESS WHEREOF, the undersigned have executed this Power of Attorney
as of the 1st day of June, 1998.
AMERICAN EXPRESS COMPANY
By: /s/ Richard Karl Goeltz
-------------------------------------
Richard Karl Goeltz
Vice Chairman and Chief Financial Officer
[CORPORATE SEAL]
Attest: /s/ Stephen P. Norman
---------------------
Stephen P. Norman
Secretary
<PAGE>
/s/ Harvey Golub /s/ Charles W. Duncan, Jr.
- ---------------------------- --------------------------------
Harvey Golub Charles W. Duncan, Jr.
Chairman, Chief Executive Director
Officer and Director
/s/ Kenneth I. Chenault /s/ Beverly Sills Greenough
- ---------------------------- --------------------------------
Kenneth I. Chenault Beverly Sills Greenough
President, Chief Operating Director
Officer and Director
/s/ Richard Karl Goeltz /s/ F. Ross Johnson
- ---------------------------- --------------------------------
Richard Karl Goeltz F. Ross Johnson
Vice Chairman and Director
Chief Financial Officer
/s/ Daniel T. Henry /s/ Vernon B. Jordan, Jr.
- ---------------------------- --------------------------------
Daniel T. Henry Vernon B. Jordan, Jr.
Senior Vice President and Director
Comptroller
/s/ Daniel F. Akerson /s/ Jan Leschly
- ---------------------------- --------------------------------
Daniel F. Akerson Jan Leschly
Director Director
/s/ Anne L. Armstrong /s/ Drew Lewis
- ---------------------------- --------------------------------
Anne L. Armstrong Drew Lewis
Director Director
/s/ Frank P. Popoff
- ---------------------------- --------------------------------
Edwin L. Artzt Frank P. Popoff
Director Director
/s/ William G. Bowen
- ----------------------------
William G. Bowen
Director
<PAGE>
Exhibit 25.1
- ------------------------------------------------------------------
UNITED STATES
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) ___________
______________________________
BANKERS TRUST COMPANY
(Exact name of trustee as specified in its charter)
NEW YORK 13-4941247
(Jurisdiction of Incorporation or (I.R.S. Employer
organization if not a U.S. national bank) Identification no.)
FOUR ALBANY STREET
NEW YORK, NEW YORK 10006
(Address of principal (Zip Code)
executive offices)
BANKERS TRUST COMPANY
LEGAL DEPARTMENT
130 LIBERTY STREET, 31ST FLOOR
NEW YORK, NEW YORK 10006
(212) 250-2201
(Name, address and telephone number of agent for
service)
_________________________________
AMERICAN EXPRESS COMPANY
(Exact name of Registrant as specified in its
charter)
NEW YORK 13-4922250
(State or other jurisdiction of (I.R.S. employer
Incorporation or organization) Identification no.)
200 VESEY STREET
NEW YORK, NEW YORK 10285
(Address, including zip code of
Principal executive offices)
JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES OF
AMERICAN EXPRESS COMPANY
(Title of the indenture securities)
<PAGE>
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.
NAME ADDRESS
---- -------
Federal Reserve Bank (2nd District) New York, NY
Federal Deposit Insurance Corporation Washington, D.C.
New York State Banking Department Albany, NY
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
ITEM 2. AFFILIATIONS WITH OBLIGOR.
If the obligor is an affiliate of the Trustee, describe each
such affiliation.
None.
Item 3. -15. Not Applicable
ITEM 16. LIST OF EXHIBITS.
Exhibit 1 - Restated Organization Certificate of Bankers Trust
Company dated August 7, 1990, Certificate of Amendment
of the Organization Certificate of Bankers Trust Company
dated June 21, 1995 - Incorporated herein by reference
to Exhibit 1 filed with Form T-1 Statement, Registration
No. 33-65171, Certificate of Amendment of the
Organization Certificate of Bankers Trust Company dated
March 20, 1996, incorporate by referenced to Exhibit 1
filed with Form T-1 Statement, Registration No. 333-
25843 and Certificate of Amendment of the Organization
Certificate of Bankers Trust Company dated June 19,
1997, copy attached.
EXHIBIT 2 - Certificate of Authority to commence business -
Incorporated herein by reference to Exhibit 2 filed with
Form T-1 Statement, Registration No. 33-21047.
EXHIBIT 3 - Authorization of the Trustee to exercise corporate trust
powers - Incorporated herein by reference to Exhibit 2
filed with Form T-1 Statement, Registration No. 33-
21047.
EXHIBIT 4 - Existing By-Laws of Bankers Trust Company, as amended on
November 18, 1997. Copy attached.
-2-
<PAGE>
EXHIBIT 5 - Not applicable.
EXHIBIT 6 - Consent of Bankers Trust Company required by Section
321(b) of the Act. - Incorporated herein by reference to
Exhibit 4 filed with Form T-1 Statement, Registration
No. 22-18864.
EXHIBIT 7 - The latest report of condition of Bankers Trust Company
dated as of December 31, 1997. Copy attached.
EXHIBIT 8 - Not Applicable.
EXHIBIT 9 - Not Applicable.
-3-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, Bankers Trust Company, 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 29th day
of May, 1998.
BANKERS TRUST COMPANY
By: /s/ Susan Johnson
_______________________________
Susan Johnson
Assistant Vice President
-4-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, Bankers Trust Company, 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 29th day
of May, 1998.
BANKERS TRUST COMPANY
By: Susan Johnson
-------------
Susan Johnson
Assistant Vice President
-5-
<PAGE>
State of New York,
Banking Department
I, MANUEL KURSKY, Deputy Superintendent of Banks of the State of New York,
DO HEREBY APPROVE the annexed Certificate entitled "CERTIFICATE OF AMENDMENT OF
THE ORGANIZATION CERTIFICATE OF BANKERS TRUST COMPANY UNDER SECTION 8005 OF THE
BANKING LAW," dated June 19, 1997, providing for an increase in authorized
capital stock from $1,601,666,670 consisting of 100,166,667 shares with a par
value of $10 each designated as Common Stock and 600 shares with a par value of
$1,000,000 each designated as Series Preferred Stock to $2,001,666,670
consisting of 100,166,667 shares with a par value of $10 each designated as
Common Stock and 1,000 shares with a par value of $1,000,000 each designated as
Series Preferred Stock.
WITNESS, my hand and official seal of the Banking Department at the City of New
York,
this 27TH day of June in the Year of our Lord one
------- ------
thousand nine hundred and NINETY-SEVEN.
Manuel Kursky
------------------------------
Deputy Superintendent of Banks
<PAGE>
CERTIFICATE OF AMENDMENT
OF THE
ORGANIZATION CERTIFICATE
OF BANKERS TRUST
Under Section 8005 of the Banking Law
_____________________________
We, James T. Byrne, Jr. and Lea Lahtinen, being respectively a Managing
Director and an Assistant Secretary of Bankers Trust Company, do hereby certify:
1. The name of the corporation is Bankers Trust Company.
2. The organization certificate of said corporation was filed by the
Superintendent of Banks on the 5th of march, 1903.
3. The organization certificate as heretofore amended is hereby amended
to increase the aggregate number of shares which the corporation shall have
authority to issue and to increase the amount of its authorized capital stock in
conformity therewith.
4. Article III of the organization certificate with reference to the
authorized capital stock, the number of shares into which the capital stock
shall be divided, the par value of the shares and the capital stock outstanding,
which reads as follows:
"III. The amount of capital stock which the corporation is hereafter to
have is One Billion, Six Hundred and One Million, Six Hundred Sixty-Six
Thousand, Six Hundred Seventy Dollars ($1,601,666,670), divided into One
Hundred Million, One Hundred Sixty-Six Thousand, Six Hundred Sixty-Seven
(100,166,667) shares with a par value of $10 each designated as Common
Stock and 600 shares with a par value of One Million Dollars ($1,000,000)
each designated as Series Preferred Stock."
is hereby amended to read as follows:
"III. The amount of capital stock which the corporation is hereafter to
have is Two Billion One Million, Six Hundred Sixty-Six Thousand, Six
Hundred Seventy Dollars ($2,001,666,670), divided into One Hundred Million,
One Hundred Sixty-Six Thousand, Six Hundred Sixty-Seven (100,166,667)
shares with a par value of $10 each designated as Common Stock and 1000
shares with a par value of One Million Dollars ($1,000,000) each designated
as Series Preferred Stock."
<PAGE>
5. The foregoing amendment of the organization certificate was authorized
by unanimous written consent signed by the holder of all outstanding shares
entitled to vote thereon.
IN WITNESS WHEREOF, we have made and subscribed this certificate this 19th
day of June, 1997.
James T. Byrne, Jr.
-------------------
James T. Byrne, Jr.
Managing Director
Lea Lahtinen
------------
Lea Lahtinen
Assistant Secretary
State of New York )
) ss:
County of New York )
Lea Lahtinen, being fully sworn, deposes and says that she is an Assistant
Secretary of Bankers Trust Company, the corporation described in the foregoing
certificate; that she has read the foregoing certificate and knows the contents
thereof, and that the statements herein contained are true.
Lea Lahtinen
--------------------------
Lea Lahtinen
Sworn to before me this 19th day
of June, 1997.
Sandra L. West
----------------------
Notary Public
SANDRA L. WEST
Notary Public State of New York
No. 31-4942101
Qualified in New York County
Commission Expires September 19, 1998
<PAGE>
BY-LAWS
NOVEMBER 18, 1997
BANKERS TRUST COMPANY
NEW YORK
<PAGE>
BY-LAWS
OF
BANKERS TRUST COMPANY
ARTICLE I
MEETINGS OF STOCKHOLDERS
SECTION 1. The annual meeting of the stockholders of this Company shall be held
at the office of the Company in the Borough of Manhattan, City of New York, on
the third Tuesday in January of each year, for the election of directors and
such other business as may properly come before said meeting.
SECTION 2. Special meetings of stockholders other than those regulated by
statute may be called at any time by a majority of the directors. It shall be
the duty of the Chairman of the Board, the Chief Executive Officer or the
President to call such meetings whenever requested in writing to do so by
stockholders owning a majority of the capital stock.
SECTION 3. At all meetings of stockholders, there shall be present, either in
person or by proxy, stockholders owning a majority of the capital stock of the
Company, in order to constitute a quorum, except at special elections of
directors, as provided by law, but less than a quorum shall have power to
adjourn any meeting.
SECTION 4. The Chairman of the Board or, in his absence, the Chief Executive
Officer or, in his absence, the President or, in their absence, the senior
officer present, shall preside at meetings of the stockholders and shall direct
the proceedings and the order of business. The Secretary shall act as secretary
of such meetings and record the proceedings.
ARTICLE II
DIRECTORS
SECTION 1. The affairs of the Company shall be managed and its corporate powers
exercised by a Board of Directors consisting of such number of directors, but
not less than ten nor more than twenty-five, as may from time to time be fixed
by resolution adopted by a majority of the directors then in office, or by the
stockholders. In the event of any increase in the number of directors,
additional directors may be elected within the limitations so fixed, either by
the stockholders or within the limitations imposed by law, by a majority of
directors then in office. One-third of the number of directors, as fixed from
time to time, shall constitute a quorum. Any one or more members of the Board
of Directors or any Committee thereof may participate in a meeting of the Board
of Directors or Committee thereof by means of a conference telephone or similar
communications equipment which allows all persons participating in the meeting
to hear each other at the same time. Participation by such means shall
constitute presence in person at such a meeting.
<PAGE>
All directors hereafter elected shall hold office until the next annual meeting
of the stockholders and until their successors are elected and have qualified.
No person who shall have attained age 72 shall be eligible to be elected or re-
elected a director. Such director may, however, remain a director of the
Company until the next annual meeting of the stockholders of Bankers Trust New
York Corporation (the Company's parent) so that such director's retirement will
coincide with the retirement date from Bankers Trust New York Corporation.
No Officer-Director who shall have attained age 65, or earlier relinquishes his
responsibilities and title, shall be eligible to serve as a director.
SECTION 2. Vacancies not exceeding one-third of the whole number of the Board
of Directors may be filled by the affirmative vote of a majority of the
directors then in office, and the directors so elected shall hold office for the
balance of the unexpired term.
SECTION 3. The Chairman of the Board shall preside at meetings of the Board of
Directors. In his absence, the Chief Executive Officer or, in his absence, such
other director as the Board of Directors from time to time may designate shall
preside at such meetings.
SECTION 4. The Board of Directors may adopt such Rules and Regulations for the
conduct of its meetings and the management of the affairs of the Company as it
may deem proper, not inconsistent with the laws of the State of New York, or
these By-Laws, and all officers and employees shall strictly adhere to, and be
bound by, such Rules and Regulations.
SECTION 5. Regular meetings of the Board of Directors shall be held from time
to time on the third Tuesday of the month. If the day appointed for holding
such regular meetings shall be a legal holiday, the regular meeting to be held
on such day shall be held on the next business day thereafter. Special meetings
of the Board of Directors may be called upon at least two day's notice whenever
it may be deemed proper by the Chairman of the Board or, the Chief Executive
Officer or, in their absence, by such other director as the Board of Directors
may have designated pursuant to Section 3 of this Article, and shall be called
upon like notice whenever any three of the directors so request in writing.
SECTION 6. The compensation of directors as such or as members of committees
shall be fixed from time to time by resolution of the Board of Directors.
<PAGE>
ARTICLE III
COMMITTEES
SECTION 1. There shall be an Executive Committee of the Board consisting of not
less than five directors who shall be appointed annually by the Board of
Directors. The Chairman of the Board shall preside at meetings of the Executive
Committee. In his absence, the Chief Executive Officer or, in his absence, such
other member of the Committee as the Committee from time to time may designate
shall preside at such meetings.
The Executive Committee shall possess and exercise to the extent permitted by
law all of the powers of the Board of Directors, except when the latter is in
session, and shall keep minutes of its proceedings, which shall be presented to
the Board of Directors at its next subsequent meeting. All acts done and powers
and authority conferred by the Executive Committee from time to time shall be
and be deemed to be, and may be certified as being, the act and under the
authority of the Board of Directors.
A majority of the Committee shall constitute a quorum, but the Committee may act
only by the concurrent vote of not less than one-third of its members, at least
one of whom must be a director other than an officer. Any one or more directors,
even though not members of the Executive Committee, may attend any meeting of
the Committee, and the member or members of the Committee present, even though
less than a quorum, may designate any one or more of such directors as a
substitute or substitutes for any absent member or members of the Committee, and
each such substitute or substitutes shall be counted for quorum, voting, and all
other purposes as a member or members of the Committee.
SECTION 2. There shall be an Audit Committee appointed annually by resolution
adopted by a majority of the entire Board of Directors which shall consist of
such number of directors, who are not also officers of the Company, as may from
time to time be fixed by resolution adopted by the Board of Directors. The
Chairman shall be designated by the Board of Directors, who shall also from time
to time fix a quorum for meetings of the Committee. Such Committee shall
conduct the annual directors' examinations of the Company as required by the New
York State Banking Law; shall review the reports of all examinations made of the
Company by public authorities and report thereon to the Board of Directors; and
shall report to the Board of Directors such other matters as it deems advisable
with respect to the Company, its various departments and the conduct of its
operations.
In the performance of its duties, the Audit Committee may employ or retain, from
time to time, expert assistants, independent of the officers or personnel of the
Company, to make studies of the Company's assets and liabilities as the
Committee may request and to make an examination of the accounting and auditing
methods of the Company and its system of internal protective controls to the
extent considered necessary or advisable in order to determine that the
operations of the Company, including its fiduciary departments, are being
audited by the General Auditor in such a manner as to provide prudent and
adequate protection. The Committee also may direct the General Auditor to make
such investigation as it deems necessary or advisable with respect to the
Company, its various departments and the conduct of its operations. The
Committee shall hold regular quarterly meetings and during the intervals thereof
shall meet at other times on call of the Chairman.
<PAGE>
SECTION 3. The Board of Directors shall have the power to appoint any other
Committees as may seem necessary, and from time to time to suspend or continue
the powers and duties of such Committees. Each Committee appointed pursuant to
this Article shall serve at the pleasure of the Board of Directors.
ARTICLE IV
OFFICERS
SECTION 1. The Board of Directors shall elect from among their number a
Chairman of the Board and a Chief Executive Officer; and shall also elect a
President, and may also elect a Senior Vice Chairman, one or more Vice Chairmen,
one or more Executive Vice Presidents, one or more Senior Managing Directors,
one or more Managing Directors, one or more Senior Vice Presidents, one or more
Principals, one or more Vice Presidents, one or more General Managers, a
Secretary, a Controller, a Treasurer, a General Counsel, one or more Associate
General Counsels, a General Auditor, a General Credit Auditor, and one or more
Deputy Auditors, who need not be directors. The officers of the corporation may
also include such other officers or assistant officers as shall from time to
time be elected or appointed by the Board. The Chairman of the Board or the
Chief Executive Officer or, in their absence, the President, the Senior Vice
Chairman or any Vice Chairman, may from time to time appoint assistant officers.
All officers elected or appointed by the Board of Directors shall hold their
respective offices during the pleasure of the Board of Directors, and all
assistant officers shall hold office at the pleasure of the Board or the
Chairman of the Board or the Chief Executive Officer or, in their absence, the
President, the Senior Vice Chairman or any Vice Chairman. The Board of
Directors may require any and all officers and employees to give security for
the faithful performance of their duties.
SECTION 2. The Board of Directors shall designate the Chief Executive Officer
of the Company who may also hold the additional title of Chairman of the Board,
President, Senior Vice Chairman or Vice Chairman and such person shall have,
subject to the supervision and direction of the Board of Directors or the
Executive Committee, all of the powers vested in such Chief Executive Officer by
law or by these By-Laws, or which usually attach or pertain to such office. The
other officers shall have, subject to the supervision and direction of the Board
of Directors or the Executive Committee or the Chairman of the Board or, the
Chief Executive Officer, the powers vested by law or by these By-Laws in them as
holders of their respective offices and, in addition, shall perform such other
duties as shall be assigned to them by the Board of Directors or the Executive
Committee or the Chairman of the Board or the Chief Executive Officer.
The General Auditor shall be responsible, through the Audit Committee, to the
Board of Directors for the determination of the program of the internal audit
function and the evaluation of the adequacy of the system of internal controls.
Subject to the Board of Directors, the General Auditor shall have and may
exercise all the powers and shall perform all the duties usual to such office
and shall have such other powers as may be prescribed or assigned to him from
time to time by the Board of Directors or vested in him by law or by these By-
Laws. He shall perform such other duties and shall make such investigations,
examinations and reports as may be prescribed or required by the Audit
Committee. The General Auditor shall have unrestricted access to all records
and premises of the Company and shall delegate such authority to his
subordinates. He shall have the duty to report to the Audit Committee on all
matters concerning the internal audit
<PAGE>
program and the adequacy of the system of internal controls of the Company which
he deems advisable or which the Audit Committee may request. Additionally, the
General Auditor shall have the duty of reporting independently of all officers
of the Company to the Audit Committee at least quarterly on any matters
concerning the internal audit program and the adequacy of the system of internal
controls of the Company that should be brought to the attention of the directors
except those matters responsibility for which has been vested in the General
Credit Auditor. Should the General Auditor deem any matter to be of special
immediate importance, he shall report thereon forthwith to the Audit Committee.
The General Auditor shall report to the Chief Financial Officer only for
administrative purposes.
The General Credit Auditor shall be responsible to the Chief Executive Officer
and, through the Audit Committee, to the Board of Directors for the systems of
internal credit audit, shall perform such other duties as the Chief Executive
Officer may prescribe, and shall make such examinations and reports as may be
required by the Audit Committee. The General Credit Auditor shall have
unrestricted access to all records and may delegate such authority to
subordinates.
SECTION 3. The compensation of all officers shall be fixed under such plan or
plans of position evaluation and salary administration as shall be approved from
time to time by resolution of the Board of Directors.
SECTION 4. The Board of Directors, the Executive Committee, the Chairman of the
Board, the Chief Executive Officer or any person authorized for this purpose by
the Chief Executive Officer, shall appoint or engage all other employees and
agents and fix their compensation. The employment of all such employees and
agents shall continue during the pleasure of the Board of Directors or the
Executive Committee or the Chairman of the Board or the Chief Executive Officer
or any such authorized person; and the Board of Directors, the Executive
Committee, the Chairman of the Board, the Chief Executive Officer or any such
authorized person may discharge any such employees and agents at will.
<PAGE>
ARTICLE V
INDEMNIFICATION OF DIRECTORS, OFFICERS AND OTHERS
SECTION 1. The Company shall, to the fullest extent permitted by Section 7018
of the New York Banking Law, indemnify any person who is or was made, or
threatened to be made, a party to an action or proceeding, whether civil or
criminal, whether involving any actual or alleged breach of duty, neglect or
error, any accountability, or any actual or alleged misstatement, misleading
statement or other act or omission and whether brought or threatened in any
court or administrative or legislative body or agency, including an action by or
in the right of the Company to procure a judgment in its favor and an action by
or in the right of any other corporation of any type or kind, domestic or
foreign, or any partnership, joint venture, trust, employee benefit plan or
other enterprise, which any director or officer of the Company is servicing or
served in any capacity at the request of the Company by reason of the fact that
he, his testator or intestate, is or was a director or officer of the Company,
or is serving or served such other corporation, partnership, joint venture,
trust, employee benefit plan or other enterprise in any capacity, against
judgments, fines, amounts paid in settlement, and costs, charges and expenses,
including attorneys' fees, or any appeal therein; provided, however, that no
indemnification shall be provided to any such person if a judgment or other
final adjudication adverse to the director or officer establishes that (i) his
acts were committed in bad faith or were the result of active and deliberate
dishonesty and, in either case, were material to the cause of action so
adjudicated, or (ii) he personally gained in fact a financial profit or other
advantage to which he was not legally entitled.
SECTION 2. The Company may indemnify any other person to whom the Company is
permitted to provide indemnification or the advancement of expenses by
applicable law, whether pursuant to rights granted pursuant to, or provided by,
the New York Banking Law or other rights created by (i) a resolution of
stockholders, (ii) a resolution of directors, or (iii) an agreement providing
for such indemnification, it being expressly intended that these By-Laws
authorize the creation of other rights in any such manner.
SECTION 3. The Company shall, from time to time, reimburse or advance to any
person referred to in Section 1 the funds necessary for payment of expenses,
including attorneys' fees, incurred in connection with any action or proceeding
referred to in Section 1, upon receipt of a written undertaking by or on behalf
of such person to repay such amount(s) if a judgment or other final adjudication
adverse to the director or officer establishes that (i) his acts were committed
in bad faith or were the result of active and deliberate dishonesty and, in
either case, were material to the cause of action so adjudicated, or (ii) he
personally gained in fact a financial profit or other advantage to which he was
not legally entitled.
SECTION 4. Any director or officer of the Company serving (i) another
corporation, of which a majority of the shares entitled to vote in the election
of its directors is held by the Company, or (ii) any employee benefit plan of
the Company or any corporation referred to in clause (i) in any capacity shall
be deemed to be doing so at the request of the Company. In all other cases, the
provisions of this Article V will apply (i) only if the person serving another
corporation or any partnership, joint venture, trust, employee benefit plan or
other enterprise so served at the specific request of the Company, evidenced by
a written communication signed by the Chairman of the Board, the Chief Executive
Officer or the
<PAGE>
President, and (ii) only if and to the extent that, after making such efforts as
the Chairman of the Board, the Chief Executive Officer or the President shall
deem adequate in the circumstances, such person shall be unable to obtain
indemnification from such other enterprise or its insurer.
SECTION 5. Any person entitled to be indemnified or to the reimbursement or
advancement of expenses as a matter of right pursuant to this Article V may
elect to have the right to indemnification (or advancement of expenses)
interpreted on the basis of the applicable law in effect at the time of
occurrence of the event or events giving rise to the action or proceeding, to
the extent permitted by law, or on the basis of the applicable law in effect at
the time indemnification is sought.
SECTION 6. The right to be indemnified or to the reimbursement or advancement
of expense pursuant to this Article V (i) is a contract right pursuant to which
the person entitled thereto may bring suit as if the provisions hereof were set
forth in a separate written contract between the Company and the director or
officer, (ii) is intended to be retroactive and shall be available with respect
to events occurring prior to the adoption hereof, and (iii) shall continue to
exist after the rescission or restrictive modification hereof with respect to
events occurring prior thereto.
SECTION 7. If a request to be indemnified or for the reimbursement or
advancement of expenses pursuant hereto is not paid in full by the Company
within thirty days after a written claim has been received by the Company, the
claimant may at any time thereafter bring suit against the Company to recover
the unpaid amount of the claim and, if successful in whole or in part, the
claimant shall be entitled also to be paid the expenses of prosecuting such
claim. Neither the failure of the Company (including its Board of Directors,
independent legal counsel, or its stockholders) to have made a determination
prior to the commencement of such action that indemnification of or
reimbursement or advancement of expenses to the claimant is proper in the
circumstance, nor an actual determination by the Company (including its Board of
Directors, independent legal counsel, or its stockholders) that the claimant is
not entitled to indemnification or to the reimbursement or advancement of
expenses, shall be a defense to the action or create a presumption that the
claimant is not so entitled.
SECTION 8. A person who has been successful, on the merits or otherwise, in the
defense of a civil or criminal action or proceeding of the character described
in Section 1 shall be entitled to indemnification only as provided in Sections 1
and 3, notwithstanding any provision of the New York Banking Law to the
contrary.
<PAGE>
ARTICLE VI
SEAL
SECTION 1. The Board of Directors shall provide a seal for the Company, the
counterpart dies of which shall be in the charge of the Secretary of the Company
and such officers as the Chairman of the Board, the Chief Executive Officer or
the Secretary may from time to time direct in writing, to be affixed to
certificates of stock and other documents in accordance with the directions of
the Board of Directors or the Executive Committee.
SECTION 2. The Board of Directors may provide, in proper cases on a specified
occasion and for a specified transaction or transactions, for the use of a
printed or engraved facsimile seal of the Company.
ARTICLE VII
CAPITAL STOCK
SECTION 1. Registration of transfer of shares shall only be made upon the books
of the Company by the registered holder in person, or by power of attorney, duly
executed, witnessed and filed with the Secretary or other proper officer of the
Company, on the surrender of the certificate or certificates of such shares
properly assigned for transfer.
ARTICLE VIII
CONSTRUCTION
SECTION 1. The masculine gender, when appearing in these By-Laws, shall be
deemed to include the feminine gender.
ARTICLE IX
AMENDMENTS
SECTION 1. These By-Laws may be altered, amended or added to by the Board of
Directors at any meeting, or by the stockholders at any annual or special
meeting, provided notice thereof has been given.
<PAGE>
I, SusanJohnson, Assistant Vice President of Bankers Trust Company, New York,
------------
New York, hereby certify that the foregoing is a complete, true and correct copy
of the By-Laws of Bankers Trust Company, and that the same are in full force and
effect at this date.
Susan Johnson
--------------------------------------
ASSISTANT VICE PRESIDENT
DATED: May 14, 1998
<PAGE>
<TABLE>
<CAPTION>
Legal Title of Bank: Bankers Trust Company Call Date: 12/31/97 ST-BK: 36-4840 FFIEC 031
Address: 130 Liberty Street Vendor ID: D CERT: 00623 Page RC-1
City, State ZIP: New York, NY 10006 11
FDIC Certificate No.: | 0 | 0 | 6 | 2 | 3
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for December 31, 1997
All schedules are to be reported in thousands of dollars. Unless otherwise indicated,
reported the amount outstanding as of the last business day of the quarter.
<S> <C> <C> <C>
Schedule RC--Balance Sheet
_______________
| C400 |
Dollar Amounts in Thousands |RCFD Bil Mil Thou |
ASSETS | / / / / / / / / / / / / /
1. Cash and balances due from depository institutions (from Schedule RC-A): | / / / / / / / / / / / / /
a. Noninterest-bearing balances and currency and coin (1) ............................... | 0081 2,121,000 |1.a.
b. Interest-bearing balances (2) ...........................................................| 0071 4,770,000 |1.b.
2. Securities: | / / / / / / / / / |
a. Held-to-maturity securities (from Schedule RC-B, column A) ....................... | 1754 0|2.a.
b. Available-for-sale securities (from Schedule RC-B, column D)...................... | 1773 4,015,000|2.b.
3. Federal funds sold and securities purchased under agreements to resell................. | 1350 28,927,000|3.
4. Loans and lease financing receivables: | / / / / / / / / / |
a. Loans and leases, net of unearned income (from Schedule RC-C) RCFD 2122 17,692,000 | / / / / / / / / / /|4.a.
b. LESS: Allowance for loan and lease losses........................RCFD 3123 659,000 | / / / / / / / / / /|4.b.
c. LESS: Allocated transfer risk reserve ...........................RCFD 3128 0 | / / / / / / / / / /|4.c.
d. Loans and leases, net of unearned income, | / / / / / / / / / /
allowance, and reserve (item 4.a minus 4.b and 4.c) ......................................| 2125 17,033,000|4.d.
5. Trading Assets (from schedule RC-D) ...........................................................| 3545 45,488,000 |5.
6. Premises and fixed assets (including capitalized leases) .......................................| 2145 766,000 |6.
7. Other real estate owned (from Schedule RC-M) ...................................................| 2150 188,000 |7.
8. Investments in unconsolidated subsidiaries and associated companies (from Schedule RC-M) | 2130 58,000 |8.
9. Customers' liability to this bank on acceptances outstanding .................................. | 2155 633,000 |9.
10. Intangible assets (from Schedule RC-M) .........................................................| 2143 83,000 |10.
11. Other assets (from Schedule RC-F) ..............................................................| 2160 5,957,000 |11.
12. Total assets (sum of items 1 through 11) .......................................................| 2170 110,039,000|12.
</TABLE>
__________________________
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
<PAGE>
<TABLE>
<CAPTION>
Legal Title of Bank: Bankers Trust Company Call Date: 12/31/97 ST-BK: 36-4840 FFIEC 031
Address: 130 Liberty Street Vendor ID: D CERT: 00623 Page RC-2
City, State Zip: New York, NY 10006 12
FDIC Certificate No.: | 0 | 0 | 6 | 2 | 3
<S> <C> <C> <C>
Schedule RC--Continued ____________________________
Dollar Amounts in Thousands | / / / / Bil Mil Thou __
LIABILITIES | / / / / / / / / / / /
13. Deposits: | / / / / / / / / / / /
a. In domestic offices (sum of totals of columns A and C from Schedule RC-E, part I) | RCON 2200 24,608,000
(1) Noninterest-bearing(1) ............................RCON 6631 2,856,000........ | / / / / / / / / / /
(2) Interest-bearing .................................. RCON 6636 21,752,000....... | / / / / / / / / / /
b. In foreign offices, Edge and Agreement subsidiaries, and IBFs (from Schedule RC-E | / / / / / / / / / /
part II) | RCFN 2200 20,529,000
(1) Noninterest-bearing .................................RCFN 6631 2,122,000| / / / / / / / / / /
(2) Interest-bearing ....................................RCFN 6636 18,407,000|
14. Federal funds purchased and securities sold under agreements to repurchase | RCFD 2800 13,777,000
15. a. Demand notes issued to the U.S. Treasury .............................................| RCON 2840 0
b. Trading liabilities (from Schedule RC-D)..............................................| RCFD 3548 24,968,000
16. Other borrowed money (includes mortgage indebtedness and obligations under capitalized leases): / / / / / / / / / /
a. With a remaining maturity of one year or less ........................................| RCFD 2332 5,810,000
b. With a remaining maturity of more than one year through three years..................| A547 4,702,000
c. With a remaining maturity of more than three years....................................| A548 1,750,000
17. Not Applicable.
18. Bank's liability on acceptances executed and outstanding ....................................| RCFD 2920 633,000
19. Subordinated notes and debentures (2)........................................................| RCFD 3200 1,307,000
20. Other liabilities (from Schedule RC-G) ......................................................| RCFD 2930 5,961,000
21. Total liabilities (sum of items 13 through 20) ..............................................| RCFD 2948 104,045,000
22. Not Applicable | / / / / / / / / / /
| / / / / / / / / / /
EQUITY CAPITAL | / / / / / / / / / /
23. Perpetual preferred stock and related surplus ...............................................| RCFD 3838 1,000,000
24. Common stock ................................................................................| RCFD 3230 1,352,000
25. Surplus (exclude all surplus related to preferred stock) ....................................| RCFD 3839 540,000
26. a. Undivided profits and capital reserves .................................................| RCFD 3632 3,526,000
b. Net unrealized holding gains (losses) on available-for-sale securities .................| RCFD 8434 ( 45,000)
27. Cumulative foreign currency translation adjustments .........................................| RCFD 3284 ( 379,000) |27.
28. Total equity capital (sum of items 23 through 27) ...........................................| RCFD 3210 5,994,000 |28.
29. Total liabilities and equity capital (sum of items 21 and 28)................................| RCFD 3300 110,039,000
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the statement below that best describes the
most comprehensive level of auditing work performed for the bank by independent external Number
auditors as of any date during 1996 .....................................| CFD 6724 N/A | M
</TABLE>
1 = Independent audit of the bank conducted in accordance
with generally accepted auditing standards by a certified
public accounting firm which submits a report on the bank
2 = Independent audit of the bank's parent holding company
conducted in accordance with generally accepted auditing
standards by a certified public accounting firm which
submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in
accordance with generally accepted auditing standards
by a certified public accounting firm (may be required by
state chartering authority)
4 = Directors' examination of the bank performed by other
external auditors (may be required by state chartering
authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external
auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
______________________
(1) Including total demand deposits and noninterest-bearing time and savings
deposits.
(2) Includes limited-life preferred stock and related surplus.
<PAGE>
_________________________________________________________________ Exhibit 25.2
UNITED STATES
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) ___________
______________________________
BANKERS TRUST COMPANY
(Exact name of trustee as specified in its charter)
NEW YORK 13-4941247
(Jurisdiction of Incorporation or (I.R.S. Employer
organization if not a U.S. national bank) Identification no.)
FOUR ALBANY STREET
NEW YORK, NEW YORK 10006
(Address of principal (Zip Code)
executive offices)
BANKERS TRUST COMPANY
LEGAL DEPARTMENT
130 LIBERTY STREET, 31ST FLOOR
NEW YORK, NEW YORK 10006
(212) 250-2201
(Name, address and telephone number of agent for service)
_________________________________
AMERICAN EXPRESS COMPANY CAPITAL TRUST I
(Exact name of Registrant as specified in its charter)
NEW YORK TO BE APPLIED FOR
(State or other jurisdiction of (I.R.S. employer
Incorporation or organization) Identification no.)
200 VESEY STREET
NEW YORK, NEW YORK 10285
(Address, including zip code of
Principal executive offices)
CAPITAL SECURITIES
(Title of the indenture securities)
<PAGE>
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.
NAME ADDRESS
---- -------
Federal Reserve Bank (2nd District) New York, NY
Federal Deposit Insurance Corporation Washington, D.C.
New York State Banking Department Albany, NY
(b) Whether it is authorized to exercise corporate trust
powers.
Yes.
ITEM 2. AFFILIATIONS WITH OBLIGOR.
If the obligor is an affiliate of the Trustee, describe each
such affiliation.
None.
Item 3. -15. Not Applicable
ITEM 16. LIST OF EXHIBITS.
Exhibit 1 - Restated Organization Certificate of Bankers Trust
Company dated August 7, 1990, Certificate of Amendment
of the Organization Certificate of Bankers Trust Company
dated June 21, 1995 - Incorporated herein by reference
to Exhibit 1 filed with Form T-1 Statement, Registration
No. 33-65171, Certificate of Amendment of the
Organization Certificate of Bankers Trust Company dated
March 20, 1996, incorporate by referenced to Exhibit 1
filed with Form T-1 Statement, Registration No. 333-
25843 and Certificate of Amendment of the Organization
Certificate of Bankers Trust Company dated June 19,
1997, copy attached.
EXHIBIT 2 - Certificate of Authority to commence business -
Incorporated herein by reference to Exhibit 2 filed with
Form T-1 Statement, Registration No. 33-21047.
EXHIBIT 3 - Authorization of the Trustee to exercise corporate trust
powers - Incorporated herein by reference to Exhibit 2
filed with Form T-1 Statement, Registration No. 33-
21047.
EXHIBIT 4 - Existing By-Laws of Bankers Trust Company, as amended on
November 18, 1997. Copy attached.
-2-
<PAGE>
EXHIBIT 5 - Not applicable.
EXHIBIT 6 - Consent of Bankers Trust Company required by Section
321(b) of the Act. - Incorporated herein by reference to
Exhibit 4 filed with Form T-1 Statement, Registration
No. 22-18864.
EXHIBIT 7 - The latest report of condition of Bankers Trust Company
dated as of December 31, 1997. Copy attached.
EXHIBIT 8 - Not Applicable.
EXHIBIT 9 - Not Applicable.
-3-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, Bankers Trust Company, 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 29th day
of May, 1998.
BANKERS TRUST COMPANY
By: /s/ Susan Johnson
--------------------------------
Susan Johnson
Assistant Vice President
-4-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, Bankers Trust Company, 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 29th day
of May, 1998.
BANKERS TRUST COMPANY
By: Susan Johnson
-------------
Susan Johnson
Assistant Vice President
-5-
<PAGE>
State of New York,
BANKING DEPARTMENT
I, MANUEL KURSKY, Deputy Superintendent of Banks of the State of New York,
DO HEREBY APPROVE the annexed Certificate entitled "CERTIFICATE OF AMENDMENT OF
THE ORGANIZATION CERTIFICATE OF BANKERS TRUST COMPANY UNDER SECTION 8005 OF THE
BANKING LAW," dated June 19, 1997, providing for an increase in authorized
capital stock from $1,601,666,670 consisting of 100,166,667 shares with a par
value of $10 each designated as Common Stock and 600 shares with a par value of
$1,000,000 each designated as Series Preferred Stock to $2,001,666,670
consisting of 100,166,667 shares with a par value of $10 each designated as
Common Stock and 1,000 shares with a par value of $1,000,000 each designated as
Series Preferred Stock.
WITNESS, my hand and official seal of the Banking Department at the City of New
York,
this 27TH day of June in the Year of our Lord
------- -----
one thousand nine hundred and NINETY-SEVEN.
Manuel Kursky
------------------------------
Deputy Superintendent of Banks
<PAGE>
CERTIFICATE OF AMENDMENT
OF THE
ORGANIZATION CERTIFICATE
OF BANKERS TRUST
Under Section 8005 of the Banking Law
_____________________________
We, James T. Byrne, Jr. and Lea Lahtinen, being respectively a Managing
Director and an Assistant Secretary of Bankers Trust Company, do hereby certify:
1. The name of the corporation is Bankers Trust Company.
2. The organization certificate of said corporation was filed by the
Superintendent of Banks on the 5th of march, 1903.
3. The organization certificate as heretofore amended is hereby amended
to increase the aggregate number of shares which the corporation shall have
authority to issue and to increase the amount of its authorized capital stock in
conformity therewith.
4. Article III of the organization certificate with reference to the
authorized capital stock, the number of shares into which the capital stock
shall be divided, the par value of the shares and the capital stock outstanding,
which reads as follows:
"III. The amount of capital stock which the corporation is hereafter to
have is One Billion, Six Hundred and One Million, Six Hundred Sixty-Six
Thousand, Six Hundred Seventy Dollars ($1,601,666,670), divided into One
Hundred Million, One Hundred Sixty-Six Thousand, Six Hundred Sixty-Seven
(100,166,667) shares with a par value of $10 each designated as Common
Stock and 600 shares with a par value of One Million Dollars ($1,000,000)
each designated as Series Preferred Stock."
is hereby amended to read as follows:
"III. The amount of capital stock which the corporation is hereafter to
have is Two Billion One Million, Six Hundred Sixty-Six Thousand, Six
Hundred Seventy Dollars ($2,001,666,670), divided into One Hundred Million,
One Hundred Sixty-Six Thousand, Six Hundred Sixty-Seven (100,166,667)
shares with a par value of $10 each designated as Common Stock and 1000
shares with a par value of One Million Dollars ($1,000,000) each designated
as Series Preferred Stock."
<PAGE>
5. The foregoing amendment of the organization certificate was authorized
by unanimous written consent signed by the holder of all outstanding shares
entitled to vote thereon.
IN WITNESS WHEREOF, we have made and subscribed this certificate this 19th
day of June, 1997.
James T. Byrne, Jr.
-------------------------------
James T. Byrne, Jr.
Managing Director
Lea Lahtinen
-------------------------------
Lea Lahtinen
Assistant Secretary
State of New York )
) ss:
County of New York )
Lea Lahtinen, being fully sworn, deposes and says that she is an Assistant
Secretary of Bankers Trust Company, the corporation described in the foregoing
certificate; that she has read the foregoing certificate and knows the contents
thereof, and that the statements herein contained are true.
Lea Lahtinen
------------
Lea Lahtinen
Sworn to before me this 19th day
of June, 1997.
Sandra L. West
---------------------
Notary Public
SANDRA L. WEST
Notary Public State of New York
No. 31-4942101
Qualified in New York County
Commission Expires September 19, 1998
<PAGE>
BY-LAWS
NOVEMBER 18, 1997
BANKERS TRUST COMPANY
NEW YORK
<PAGE>
BY-LAWS
OF
BANKERS TRUST COMPANY
ARTICLE I
MEETINGS OF STOCKHOLDERS
SECTION 1. The annual meeting of the stockholders of this Company shall be held
at the office of the Company in the Borough of Manhattan, City of New York, on
the third Tuesday in January of each year, for the election of directors and
such other business as may properly come before said meeting.
SECTION 2. Special meetings of stockholders other than those regulated by
statute may be called at any time by a majority of the directors. It shall be
the duty of the Chairman of the Board, the Chief Executive Officer or the
President to call such meetings whenever requested in writing to do so by
stockholders owning a majority of the capital stock.
SECTION 3. At all meetings of stockholders, there shall be present, either in
person or by proxy, stockholders owning a majority of the capital stock of the
Company, in order to constitute a quorum, except at special elections of
directors, as provided by law, but less than a quorum shall have power to
adjourn any meeting.
SECTION 4. The Chairman of the Board or, in his absence, the Chief Executive
Officer or, in his absence, the President or, in their absence, the senior
officer present, shall preside at meetings of the stockholders and shall direct
the proceedings and the order of business. The Secretary shall act as secretary
of such meetings and record the proceedings.
ARTICLE II
DIRECTORS
SECTION 1. The affairs of the Company shall be managed and its corporate powers
exercised by a Board of Directors consisting of such number of directors, but
not less than ten nor more than twenty-five, as may from time to time be fixed
by resolution adopted by a majority of the directors then in office, or by the
stockholders. In the event of any increase in the number of directors,
additional directors may be elected within the limitations so fixed, either by
the stockholders or within the limitations imposed by law, by a majority of
directors then in office. One-third of the number of directors, as fixed from
time to time, shall constitute a quorum. Any one or more members of the Board
of Directors or any Committee thereof may participate in a meeting of the Board
of Directors or Committee thereof by means of a conference telephone or similar
communications equipment which allows all persons participating in the meeting
to hear each other at the same time. Participation by such means shall
constitute presence in person at such a meeting.
<PAGE>
All directors hereafter elected shall hold office until the next annual meeting
of the stockholders and until their successors are elected and have qualified.
No person who shall have attained age 72 shall be eligible to be elected or re-
elected a director. Such director may, however, remain a director of the
Company until the next annual meeting of the stockholders of Bankers Trust New
York Corporation (the Company's parent) so that such director's retirement will
coincide with the retirement date from Bankers Trust New York Corporation.
No Officer-Director who shall have attained age 65, or earlier relinquishes his
responsibilities and title, shall be eligible to serve as a director.
SECTION 2. Vacancies not exceeding one-third of the whole number of the Board
of Directors may be filled by the affirmative vote of a majority of the
directors then in office, and the directors so elected shall hold office for the
balance of the unexpired term.
SECTION 3. The Chairman of the Board shall preside at meetings of the Board of
Directors. In his absence, the Chief Executive Officer or, in his absence, such
other director as the Board of Directors from time to time may designate shall
preside at such meetings.
SECTION 4. The Board of Directors may adopt such Rules and Regulations for the
conduct of its meetings and the management of the affairs of the Company as it
may deem proper, not inconsistent with the laws of the State of New York, or
these By-Laws, and all officers and employees shall strictly adhere to, and be
bound by, such Rules and Regulations.
SECTION 5. Regular meetings of the Board of Directors shall be held from time
to time on the third Tuesday of the month. If the day appointed for holding
such regular meetings shall be a legal holiday, the regular meeting to be held
on such day shall be held on the next business day thereafter. Special meetings
of the Board of Directors may be called upon at least two day's notice whenever
it may be deemed proper by the Chairman of the Board or, the Chief Executive
Officer or, in their absence, by such other director as the Board of Directors
may have designated pursuant to Section 3 of this Article, and shall be called
upon like notice whenever any three of the directors so request in writing.
SECTION 6. The compensation of directors as such or as members of committees
shall be fixed from time to time by resolution of the Board of Directors.
<PAGE>
ARTICLE III
COMMITTEES
SECTION 1. There shall be an Executive Committee of the Board consisting of not
less than five directors who shall be appointed annually by the Board of
Directors. The Chairman of the Board shall preside at meetings of the Executive
Committee. In his absence, the Chief Executive Officer or, in his absence, such
other member of the Committee as the Committee from time to time may designate
shall preside at such meetings.
The Executive Committee shall possess and exercise to the extent permitted by
law all of the powers of the Board of Directors, except when the latter is in
session, and shall keep minutes of its proceedings, which shall be presented to
the Board of Directors at its next subsequent meeting. All acts done and powers
and authority conferred by the Executive Committee from time to time shall be
and be deemed to be, and may be certified as being, the act and under the
authority of the Board of Directors.
A majority of the Committee shall constitute a quorum, but the Committee may act
only by the concurrent vote of not less than one-third of its members, at least
one of whom must be a director other than an officer. Any one or more directors,
even though not members of the Executive Committee, may attend any meeting of
the Committee, and the member or members of the Committee present, even though
less than a quorum, may designate any one or more of such directors as a
substitute or substitutes for any absent member or members of the Committee, and
each such substitute or substitutes shall be counted for quorum, voting, and all
other purposes as a member or members of the Committee.
SECTION 2. There shall be an Audit Committee appointed annually by resolution
adopted by a majority of the entire Board of Directors which shall consist of
such number of directors, who are not also officers of the Company, as may from
time to time be fixed by resolution adopted by the Board of Directors. The
Chairman shall be designated by the Board of Directors, who shall also from time
to time fix a quorum for meetings of the Committee. Such Committee shall
conduct the annual directors' examinations of the Company as required by the New
York State Banking Law; shall review the reports of all examinations made of the
Company by public authorities and report thereon to the Board of Directors; and
shall report to the Board of Directors such other matters as it deems advisable
with respect to the Company, its various departments and the conduct of its
operations.
In the performance of its duties, the Audit Committee may employ or retain, from
time to time, expert assistants, independent of the officers or personnel of the
Company, to make studies of the Company's assets and liabilities as the
Committee may request and to make an examination of the accounting and auditing
methods of the Company and its system of internal protective controls to the
extent considered necessary or advisable in order to determine that the
operations of the Company, including its fiduciary departments, are being
audited by the General Auditor in such a manner as to provide prudent and
adequate protection. The Committee also may direct the General Auditor to make
such investigation as it deems necessary or advisable with respect to the
Company, its various departments and the conduct of its operations. The
Committee shall hold regular quarterly meetings and during the intervals thereof
shall meet at other times on call of the Chairman.
<PAGE>
SECTION 3. The Board of Directors shall have the power to appoint any other
Committees as may seem necessary, and from time to time to suspend or continue
the powers and duties of such Committees. Each Committee appointed pursuant to
this Article shall serve at the pleasure of the Board of Directors.
ARTICLE IV
OFFICERS
SECTION 1. The Board of Directors shall elect from among their number a
Chairman of the Board and a Chief Executive Officer; and shall also elect a
President, and may also elect a Senior Vice Chairman, one or more Vice Chairmen,
one or more Executive Vice Presidents, one or more Senior Managing Directors,
one or more Managing Directors, one or more Senior Vice Presidents, one or more
Principals, one or more Vice Presidents, one or more General Managers, a
Secretary, a Controller, a Treasurer, a General Counsel, one or more Associate
General Counsels, a General Auditor, a General Credit Auditor, and one or more
Deputy Auditors, who need not be directors. The officers of the corporation may
also include such other officers or assistant officers as shall from time to
time be elected or appointed by the Board. The Chairman of the Board or the
Chief Executive Officer or, in their absence, the President, the Senior Vice
Chairman or any Vice Chairman, may from time to time appoint assistant officers.
All officers elected or appointed by the Board of Directors shall hold their
respective offices during the pleasure of the Board of Directors, and all
assistant officers shall hold office at the pleasure of the Board or the
Chairman of the Board or the Chief Executive Officer or, in their absence, the
President, the Senior Vice Chairman or any Vice Chairman. The Board of
Directors may require any and all officers and employees to give security for
the faithful performance of their duties.
SECTION 2. The Board of Directors shall designate the Chief Executive Officer
of the Company who may also hold the additional title of Chairman of the Board,
President, Senior Vice Chairman or Vice Chairman and such person shall have,
subject to the supervision and direction of the Board of Directors or the
Executive Committee, all of the powers vested in such Chief Executive Officer by
law or by these By-Laws, or which usually attach or pertain to such office. The
other officers shall have, subject to the supervision and direction of the Board
of Directors or the Executive Committee or the Chairman of the Board or, the
Chief Executive Officer, the powers vested by law or by these By-Laws in them as
holders of their respective offices and, in addition, shall perform such other
duties as shall be assigned to them by the Board of Directors or the Executive
Committee or the Chairman of the Board or the Chief Executive Officer.
The General Auditor shall be responsible, through the Audit Committee, to the
Board of Directors for the determination of the program of the internal audit
function and the evaluation of the adequacy of the system of internal controls.
Subject to the Board of Directors, the General Auditor shall have and may
exercise all the powers and shall perform all the duties usual to such office
and shall have such other powers as may be prescribed or assigned to him from
time to time by the Board of Directors or vested in him by law or by these By-
Laws. He shall perform such other duties and shall make such investigations,
examinations and reports as may be prescribed or required by the Audit
Committee. The General Auditor shall have unrestricted access to all records
and premises of the Company and shall delegate such authority to his
subordinates. He shall have the duty to report to the Audit Committee on all
matters concerning the internal audit
<PAGE>
program and the adequacy of the system of internal controls of the Company which
he deems advisable or which the Audit Committee may request. Additionally, the
General Auditor shall have the duty of reporting independently of all officers
of the Company to the Audit Committee at least quarterly on any matters
concerning the internal audit program and the adequacy of the system of internal
controls of the Company that should be brought to the attention of the directors
except those matters responsibility for which has been vested in the General
Credit Auditor. Should the General Auditor deem any matter to be of special
immediate importance, he shall report thereon forthwith to the Audit Committee.
The General Auditor shall report to the Chief Financial Officer only for
administrative purposes.
The General Credit Auditor shall be responsible to the Chief Executive Officer
and, through the Audit Committee, to the Board of Directors for the systems of
internal credit audit, shall perform such other duties as the Chief Executive
Officer may prescribe, and shall make such examinations and reports as may be
required by the Audit Committee. The General Credit Auditor shall have
unrestricted access to all records and may delegate such authority to
subordinates.
SECTION 3. The compensation of all officers shall be fixed under such plan or
plans of position evaluation and salary administration as shall be approved from
time to time by resolution of the Board of Directors.
SECTION 4. The Board of Directors, the Executive Committee, the Chairman of the
Board, the Chief Executive Officer or any person authorized for this purpose by
the Chief Executive Officer, shall appoint or engage all other employees and
agents and fix their compensation. The employment of all such employees and
agents shall continue during the pleasure of the Board of Directors or the
Executive Committee or the Chairman of the Board or the Chief Executive Officer
or any such authorized person; and the Board of Directors, the Executive
Committee, the Chairman of the Board, the Chief Executive Officer or any such
authorized person may discharge any such employees and agents at will.
<PAGE>
ARTICLE V
INDEMNIFICATION OF DIRECTORS, OFFICERS AND OTHERS
SECTION 1. The Company shall, to the fullest extent permitted by Section 7018
of the New York Banking Law, indemnify any person who is or was made, or
threatened to be made, a party to an action or proceeding, whether civil or
criminal, whether involving any actual or alleged breach of duty, neglect or
error, any accountability, or any actual or alleged misstatement, misleading
statement or other act or omission and whether brought or threatened in any
court or administrative or legislative body or agency, including an action by or
in the right of the Company to procure a judgment in its favor and an action by
or in the right of any other corporation of any type or kind, domestic or
foreign, or any partnership, joint venture, trust, employee benefit plan or
other enterprise, which any director or officer of the Company is servicing or
served in any capacity at the request of the Company by reason of the fact that
he, his testator or intestate, is or was a director or officer of the Company,
or is serving or served such other corporation, partnership, joint venture,
trust, employee benefit plan or other enterprise in any capacity, against
judgments, fines, amounts paid in settlement, and costs, charges and expenses,
including attorneys' fees, or any appeal therein; provided, however, that no
indemnification shall be provided to any such person if a judgment or other
final adjudication adverse to the director or officer establishes that (i) his
acts were committed in bad faith or were the result of active and deliberate
dishonesty and, in either case, were material to the cause of action so
adjudicated, or (ii) he personally gained in fact a financial profit or other
advantage to which he was not legally entitled.
SECTION 2. The Company may indemnify any other person to whom the Company is
permitted to provide indemnification or the advancement of expenses by
applicable law, whether pursuant to rights granted pursuant to, or provided by,
the New York Banking Law or other rights created by (i) a resolution of
stockholders, (ii) a resolution of directors, or (iii) an agreement providing
for such indemnification, it being expressly intended that these By-Laws
authorize the creation of other rights in any such manner.
SECTION 3. The Company shall, from time to time, reimburse or advance to any
person referred to in Section 1 the funds necessary for payment of expenses,
including attorneys' fees, incurred in connection with any action or proceeding
referred to in Section 1, upon receipt of a written undertaking by or on behalf
of such person to repay such amount(s) if a judgment or other final adjudication
adverse to the director or officer establishes that (i) his acts were committed
in bad faith or were the result of active and deliberate dishonesty and, in
either case, were material to the cause of action so adjudicated, or (ii) he
personally gained in fact a financial profit or other advantage to which he was
not legally entitled.
SECTION 4. Any director or officer of the Company serving (i) another
corporation, of which a majority of the shares entitled to vote in the election
of its directors is held by the Company, or (ii) any employee benefit plan of
the Company or any corporation referred to in clause (i) in any capacity shall
be deemed to be doing so at the request of the Company. In all other cases, the
provisions of this Article V will apply (i) only if the person serving another
corporation or any partnership, joint venture, trust, employee benefit plan or
other enterprise so served at the specific request of the Company, evidenced by
a written communication signed by the Chairman of the Board, the Chief Executive
Officer or the
<PAGE>
President, and (ii) only if and to the extent that, after making such efforts as
the Chairman of the Board, the Chief Executive Officer or the President shall
deem adequate in the circumstances, such person shall be unable to obtain
indemnification from such other enterprise or its insurer.
SECTION 5. Any person entitled to be indemnified or to the reimbursement or
advancement of expenses as a matter of right pursuant to this Article V may
elect to have the right to indemnification (or advancement of expenses)
interpreted on the basis of the applicable law in effect at the time of
occurrence of the event or events giving rise to the action or proceeding, to
the extent permitted by law, or on the basis of the applicable law in effect at
the time indemnification is sought.
SECTION 6. The right to be indemnified or to the reimbursement or advancement
of expense pursuant to this Article V (i) is a contract right pursuant to which
the person entitled thereto may bring suit as if the provisions hereof were set
forth in a separate written contract between the Company and the director or
officer, (ii) is intended to be retroactive and shall be available with respect
to events occurring prior to the adoption hereof, and (iii) shall continue to
exist after the rescission or restrictive modification hereof with respect to
events occurring prior thereto.
SECTION 7. If a request to be indemnified or for the reimbursement or
advancement of expenses pursuant hereto is not paid in full by the Company
within thirty days after a written claim has been received by the Company, the
claimant may at any time thereafter bring suit against the Company to recover
the unpaid amount of the claim and, if successful in whole or in part, the
claimant shall be entitled also to be paid the expenses of prosecuting such
claim. Neither the failure of the Company (including its Board of Directors,
independent legal counsel, or its stockholders) to have made a determination
prior to the commencement of such action that indemnification of or
reimbursement or advancement of expenses to the claimant is proper in the
circumstance, nor an actual determination by the Company (including its Board of
Directors, independent legal counsel, or its stockholders) that the claimant is
not entitled to indemnification or to the reimbursement or advancement of
expenses, shall be a defense to the action or create a presumption that the
claimant is not so entitled.
SECTION 8. A person who has been successful, on the merits or otherwise, in the
defense of a civil or criminal action or proceeding of the character described
in Section 1 shall be entitled to indemnification only as provided in Sections 1
and 3, notwithstanding any provision of the New York Banking Law to the
contrary.
<PAGE>
ARTICLE VI
SEAL
SECTION 1. The Board of Directors shall provide a seal for the Company, the
counterpart dies of which shall be in the charge of the Secretary of the Company
and such officers as the Chairman of the Board, the Chief Executive Officer or
the Secretary may from time to time direct in writing, to be affixed to
certificates of stock and other documents in accordance with the directions of
the Board of Directors or the Executive Committee.
SECTION 2. The Board of Directors may provide, in proper cases on a specified
occasion and for a specified transaction or transactions, for the use of a
printed or engraved facsimile seal of the Company.
ARTICLE VII
CAPITAL STOCK
SECTION 1. Registration of transfer of shares shall only be made upon the books
of the Company by the registered holder in person, or by power of attorney, duly
executed, witnessed and filed with the Secretary or other proper officer of the
Company, on the surrender of the certificate or certificates of such shares
properly assigned for transfer.
ARTICLE VIII
CONSTRUCTION
SECTION 1. The masculine gender, when appearing in these By-Laws, shall be
deemed to include the feminine gender.
ARTICLE IX
AMENDMENTS
SECTION 1. These By-Laws may be altered, amended or added to by the Board of
Directors at any meeting, or by the stockholders at any annual or special
meeting, provided notice thereof has been given.
<PAGE>
I, SusanJohnson, Assistant Vice President of Bankers Trust Company, New York,
------------
New York, hereby certify that the foregoing is a complete, true and correct copy
of the By-Laws of Bankers Trust Company, and that the same are in full force and
effect at this date.
Susan Johnson
--------------------------------------
ASSISTANT VICE PRESIDENT
DATED: May 14, 1998
<PAGE>
<TABLE>
<CAPTION>
Legal Title of Bank: Bankers Trust Company Call Date: 12/31/97 ST-BK: 36-4840 FFIEC 031
Address: 130 Liberty Street Vendor ID: D CERT: 00623 Page RC-1
City, State ZIP: New York, NY 10006 11
FDIC Certificate No.: | 0 | 0 | 6 | 2 | 3
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for December 31, 1997
All schedules are to be reported in thousands of dollars. Unless otherwise indicated,
reported the amount outstanding as of the last business day of the quarter.
<S> <C> <C> <C>
Schedule RC--Balance Sheet
_______________
| C400 |
Dollar Amounts in Thousands |RCFD Bil Mil Thou |
ASSETS | / / / / / / / / / / / / /
1. Cash and balances due from depository institutions (from Schedule RC-A): | / / / / / / / / / / / / /
a. Noninterest-bearing balances and currency and coin (1) ............................... | 0081 2,121,000 |1.a.
b. Interest-bearing balances (2) ...........................................................| 0071 4,770,000 |1.b.
2. Securities: | / / / / / / / / / |
a. Held-to-maturity securities (from Schedule RC-B, column A) ....................... | 1754 0|2.a.
b. Available-for-sale securities (from Schedule RC-B, column D)...................... | 1773 4,015,000|2.b.
3. Federal funds sold and securities purchased under agreements to resell................. | 1350 28,927,000|3.
4. Loans and lease financing receivables: | / / / / / / / / / |
a. Loans and leases, net of unearned income (from Schedule RC-C) RCFD 2122 17,692,000 | / / / / / / / / / /|4.a.
b. LESS: Allowance for loan and lease losses........................RCFD 3123 659,000 | / / / / / / / / / /|4.b.
c. LESS: Allocated transfer risk reserve ...........................RCFD 3128 0 | / / / / / / / / / /|4.c.
d. Loans and leases, net of unearned income, | / / / / / / / / / /
allowance, and reserve (item 4.a minus 4.b and 4.c) ......................................| 2125 17,033,000|4.d.
5. Trading Assets (from schedule RC-D) ...........................................................| 3545 45,488,000 |5.
6. Premises and fixed assets (including capitalized leases) .......................................| 2145 766,000 |6.
7. Other real estate owned (from Schedule RC-M) ...................................................| 2150 188,000 |7.
8. Investments in unconsolidated subsidiaries and associated companies (from Schedule RC-M) | 2130 58,000 |8.
9. Customers' liability to this bank on acceptances outstanding .................................. | 2155 633,000 |9.
10. Intangible assets (from Schedule RC-M) .........................................................| 2143 83,000 |10.
11. Other assets (from Schedule RC-F) ..............................................................| 2160 5,957,000 |11.
12. Total assets (sum of items 1 through 11) .......................................................| 2170 110,039,000|12.
</TABLE>
__________________________
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
<PAGE>
<TABLE>
<CAPTION>
Legal Title of Bank: Bankers Trust Company Call Date: 12/31/97 ST-BK: 36-4840 FFIEC 031
Address: 130 Liberty Street Vendor ID: D CERT: 00623 Page RC-2
City, State Zip: New York, NY 10006 12
FDIC Certificate No.: | 0 | 0 | 6 | 2 | 3
<S> <C> <C> <C>
Schedule RC--Continued ____________________________
Dollar Amounts in Thousands | / / / / Bil Mil Thou __
LIABILITIES | / / / / / / / / / / /
13. Deposits: | / / / / / / / / / / /
a. In domestic offices (sum of totals of columns A and C from Schedule RC-E, part I) | RCON 2200 24,608,000
(1) Noninterest-bearing(1) ............................RCON 6631 2,856,000........ | / / / / / / / / / /
(2) Interest-bearing .................................. RCON 6636 21,752,000....... | / / / / / / / / / /
b. In foreign offices, Edge and Agreement subsidiaries, and IBFs (from Schedule RC-E | / / / / / / / / / /
part II) | RCFN 2200 20,529,000
(1) Noninterest-bearing .................................RCFN 6631 2,122,000| / / / / / / / / / /
(2) Interest-bearing ....................................RCFN 6636 18,407,000|
14. Federal funds purchased and securities sold under agreements to repurchase | RCFD 2800 13,777,000
15. a. Demand notes issued to the U.S. Treasury .............................................| RCON 2840 0
b. Trading liabilities (from Schedule RC-D)..............................................| RCFD 3548 24,968,000
16. Other borrowed money (includes mortgage indebtedness and obligations under capitalized leases): / / / / / / / / / /
a. With a remaining maturity of one year or less ........................................| RCFD 2332 5,810,000
b. With a remaining maturity of more than one year through three years..................| A547 4,702,000
c. With a remaining maturity of more than three years....................................| A548 1,750,000
17. Not Applicable.
18. Bank's liability on acceptances executed and outstanding ....................................| RCFD 2920 633,000
19. Subordinated notes and debentures (2)........................................................| RCFD 3200 1,307,000
20. Other liabilities (from Schedule RC-G) ......................................................| RCFD 2930 5,961,000
21. Total liabilities (sum of items 13 through 20) ..............................................| RCFD 2948 104,045,000
22. Not Applicable | / / / / / / / / / /
| / / / / / / / / / /
EQUITY CAPITAL | / / / / / / / / / /
23. Perpetual preferred stock and related surplus ...............................................| RCFD 3838 1,000,000
24. Common stock ................................................................................| RCFD 3230 1,352,000
25. Surplus (exclude all surplus related to preferred stock) ....................................| RCFD 3839 540,000
26. a. Undivided profits and capital reserves .................................................| RCFD 3632 3,526,000
b. Net unrealized holding gains (losses) on available-for-sale securities .................| RCFD 8434 ( 45,000)
27. Cumulative foreign currency translation adjustments .........................................| RCFD 3284 ( 379,000) |27.
28. Total equity capital (sum of items 23 through 27) ...........................................| RCFD 3210 5,994,000 |28.
29. Total liabilities and equity capital (sum of items 21 and 28)................................| RCFD 3300 110,039,000
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the statement below that best describes the
most comprehensive level of auditing work performed for the bank by independent external Number
auditors as of any date during 1996 .....................................| CFD 6724 N/A | M
</TABLE>
1 = Independent audit of the bank conducted in accordance
with generally accepted auditing standards by a certified
public accounting firm which submits a report on the bank
2 = Independent audit of the bank's parent holding company
conducted in accordance with generally accepted auditing
standards by a certified public accounting firm which
submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in
accordance with generally accepted auditing standards
by a certified public accounting firm (may be required by
state chartering authority)
4 = Directors' examination of the bank performed by other
external auditors (may be required by state chartering
authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external
auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
______________________
(1) Including total demand deposits and noninterest-bearing time and savings
deposits.
(2) Includes limited-life preferred stock and related surplus.
<PAGE>
__________________________________________________________________ Exhibit 25.3
UNITED STATES
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) ___________
______________________________
BANKERS TRUST COMPANY
(Exact name of trustee as specified in its charter)
NEW YORK 13-4941247
(Jurisdiction of Incorporation or (I.R.S. Employer
organization if not a U.S. national bank) Identification no.)
FOUR ALBANY STREET
NEW YORK, NEW YORK 10006
(Address of principal (Zip Code)
executive offices)
BANKERS TRUST COMPANY
LEGAL DEPARTMENT
130 LIBERTY STREET, 31ST FLOOR
NEW YORK, NEW YORK 10006
(212) 250-2201
(Name, address and telephone number of agent for service)
_________________________________
AMERICAN EXPRESS COMPANY CAPITAL TRUST II
(Exact name of Registrant as specified in its charter)
NEW YORK TO BE APPLIED FOR
(State or other jurisdiction of (I.R.S. employer
Incorporation or organization) Identification no.)
200 VESEY STREET
NEW YORK, NEW YORK 10285
(Address, including zip code of
Principal executive offices)
CAPITAL SECURITIES
(Title of the indenture securities)
<PAGE>
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.
NAME ADDRESS
---- -------
Federal Reserve Bank (2nd District) New York, NY
Federal Deposit Insurance Corporation Washington, D.C.
New York State Banking Department Albany, NY
(b) Whether it is authorized to exercise corporate trust
powers.
Yes.
ITEM 2. AFFILIATIONS WITH OBLIGOR.
If the obligor is an affiliate of the Trustee, describe each
such affiliation.
None.
Item 3. -15. Not Applicable
ITEM 16. LIST OF EXHIBITS.
EXHIBIT 1 - Restated Organization Certificate of Bankers Trust
Company dated August 7, 1990, Certificate of Amendment
of the Organization Certificate of Bankers Trust Company
dated June 21, 1995 - Incorporated herein by reference
to Exhibit 1 filed with Form T-1 Statement, Registration
No. 33-65171, Certificate of Amendment of the
Organization Certificate of Bankers Trust Company dated
March 20, 1996, incorporate by referenced to Exhibit 1
filed with Form T-1 Statement, Registration No. 333-
25843 and Certificate of Amendment of the Organization
Certificate of Bankers Trust Company dated June 19,
1997, copy attached.
EXHIBIT 2 - Certificate of Authority to commence business -
Incorporated herein by reference to Exhibit 2 filed with
Form T-1 Statement, Registration No. 33-21047.
EXHIBIT 3 - Authorization of the Trustee to exercise corporate trust
powers - Incorporated herein by reference to Exhibit 2
filed with Form T-1 Statement, Registration No. 33-
21047.
EXHIBIT 4 - Existing By-Laws of Bankers Trust Company, as amended on
November 18, 1997. Copy attached.
-2-
<PAGE>
EXHIBIT 5 - Not applicable.
EXHIBIT 6 - Consent of Bankers Trust Company required by Section
321(b) of the Act. - Incorporated herein by reference to
Exhibit 4 filed with Form T-1 Statement, Registration
No. 22-18864.
EXHIBIT 7 - The latest report of condition of Bankers Trust Company
dated as of December 31, 1997. Copy attached.
EXHIBIT 8 - Not Applicable.
EXHIBIT 9 - Not Applicable.
-3-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, Bankers Trust Company, 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 29th day
of May, 1998.
BANKERS TRUST COMPANY
By: /s/ Susan Johnson
_______________________________
Susan Johnson
Assistant Vice President
-4-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, Bankers Trust Company, 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 29th day
of May, 1998.
BANKERS TRUST COMPANY
By: Susan Johnson
------------------
Susan Johnson
Assistant Vice President
-5-
<PAGE>
State of New York,
BANKING DEPARTMENT
I, MANUEL KURSKY, Deputy Superintendent of Banks of the State of New York,
DO HEREBY APPROVE the annexed Certificate entitled "CERTIFICATE OF AMENDMENT OF
THE ORGANIZATION CERTIFICATE OF BANKERS TRUST COMPANY UNDER SECTION 8005 OF THE
BANKING LAW," dated June 19, 1997, providing for an increase in authorized
capital stock from $1,601,666,670 consisting of 100,166,667 shares with a par
value of $10 each designated as Common Stock and 600 shares with a par value of
$1,000,000 each designated as Series Preferred Stock to $2,001,666,670
consisting of 100,166,667 shares with a par value of $10 each designated as
Common Stock and 1,000 shares with a par value of $1,000,000 each designated as
Series Preferred Stock.
WITNESS, my hand and official seal of the Banking Department at the City of New
York,
this 27TH day of June in the Year of our Lord
------- -----
one thousand nine hundred and NINETY-SEVEN.
Manuel Kursky
-------------------------------
Deputy Superintendent of Banks
<PAGE>
CERTIFICATE OF AMENDMENT
OF THE
ORGANIZATION CERTIFICATE
OF BANKERS TRUST
Under Section 8005 of the Banking Law
_____________________________
We, James T. Byrne, Jr. and Lea Lahtinen, being respectively a Managing
Director and an Assistant Secretary of Bankers Trust Company, do hereby certify:
1. The name of the corporation is Bankers Trust Company.
2. The organization certificate of said corporation was filed by the
Superintendent of Banks on the 5th of march, 1903.
3. The organization certificate as heretofore amended is hereby amended
to increase the aggregate number of shares which the corporation shall have
authority to issue and to increase the amount of its authorized capital stock in
conformity therewith.
4. Article III of the organization certificate with reference to the
authorized capital stock, the number of shares into which the capital stock
shall be divided, the par value of the shares and the capital stock outstanding,
which reads as follows:
"III. The amount of capital stock which the corporation is hereafter to
have is One Billion, Six Hundred and One Million, Six Hundred Sixty-Six
Thousand, Six Hundred Seventy Dollars ($1,601,666,670), divided into One
Hundred Million, One Hundred Sixty-Six Thousand, Six Hundred Sixty-Seven
(100,166,667) shares with a par value of $10 each designated as Common
Stock and 600 shares with a par value of One Million Dollars ($1,000,000)
each designated as Series Preferred Stock."
is hereby amended to read as follows:
"III. The amount of capital stock which the corporation is hereafter to
have is Two Billion One Million, Six Hundred Sixty-Six Thousand, Six
Hundred Seventy Dollars ($2,001,666,670), divided into One Hundred Million,
One Hundred Sixty-Six Thousand, Six Hundred Sixty-Seven (100,166,667)
shares with a par value of $10 each designated as Common Stock and 1000
shares with a par value of One Million Dollars ($1,000,000) each designated
as Series Preferred Stock."
<PAGE>
5. The foregoing amendment of the organization certificate was authorized
by unanimous written consent signed by the holder of all outstanding shares
entitled to vote thereon.
IN WITNESS WHEREOF, we have made and subscribed this certificate this 19th
day of June, 1997.
James T. Byrne, Jr.
-------------------
James T. Byrne, Jr.
Managing Director
Lea Lahtinen
------------
Lea Lahtinen
Assistant Secretary
State of New York )
) ss:
County of New York )
Lea Lahtinen, being fully sworn, deposes and says that she is an Assistant
Secretary of Bankers Trust Company, the corporation described in the foregoing
certificate; that she has read the foregoing certificate and knows the contents
thereof, and that the statements herein contained are true.
Lea Lahtinen
------------
Lea Lahtinen
Sworn to before me this 19th day
of June, 1997.
Sandra L. West
------------------
Notary Public
SANDRA L. WEST
Notary Public State of New York
No. 31-4942101
Qualified in New York County
Commission Expires September 19, 1998
<PAGE>
BY-LAWS
NOVEMBER 18, 1997
BANKERS TRUST COMPANY
NEW YORK
<PAGE>
BY-LAWS
OF
BANKERS TRUST COMPANY
ARTICLE I
MEETINGS OF STOCKHOLDERS
SECTION 1. The annual meeting of the stockholders of this Company shall be held
at the office of the Company in the Borough of Manhattan, City of New York, on
the third Tuesday in January of each year, for the election of directors and
such other business as may properly come before said meeting.
SECTION 2. Special meetings of stockholders other than those regulated by
statute may be called at any time by a majority of the directors. It shall be
the duty of the Chairman of the Board, the Chief Executive Officer or the
President to call such meetings whenever requested in writing to do so by
stockholders owning a majority of the capital stock.
SECTION 3. At all meetings of stockholders, there shall be present, either in
person or by proxy, stockholders owning a majority of the capital stock of the
Company, in order to constitute a quorum, except at special elections of
directors, as provided by law, but less than a quorum shall have power to
adjourn any meeting.
SECTION 4. The Chairman of the Board or, in his absence, the Chief Executive
Officer or, in his absence, the President or, in their absence, the senior
officer present, shall preside at meetings of the stockholders and shall direct
the proceedings and the order of business. The Secretary shall act as secretary
of such meetings and record the proceedings.
ARTICLE II
DIRECTORS
SECTION 1. The affairs of the Company shall be managed and its corporate powers
exercised by a Board of Directors consisting of such number of directors, but
not less than ten nor more than twenty-five, as may from time to time be fixed
by resolution adopted by a majority of the directors then in office, or by the
stockholders. In the event of any increase in the number of directors,
additional directors may be elected within the limitations so fixed, either by
the stockholders or within the limitations imposed by law, by a majority of
directors then in office. One-third of the number of directors, as fixed from
time to time, shall constitute a quorum. Any one or more members of the Board
of Directors or any Committee thereof may participate in a meeting of the Board
of Directors or Committee thereof by means of a conference telephone or similar
communications equipment which allows all persons participating in the meeting
to hear each other at the same time. Participation by such means shall
constitute presence in person at such a meeting.
<PAGE>
All directors hereafter elected shall hold office until the next annual meeting
of the stockholders and until their successors are elected and have qualified.
No person who shall have attained age 72 shall be eligible to be elected or re-
elected a director. Such director may, however, remain a director of the
Company until the next annual meeting of the stockholders of Bankers Trust New
York Corporation (the Company's parent) so that such director's retirement will
coincide with the retirement date from Bankers Trust New York Corporation.
No Officer-Director who shall have attained age 65, or earlier relinquishes his
responsibilities and title, shall be eligible to serve as a director.
SECTION 2. Vacancies not exceeding one-third of the whole number of the Board
of Directors may be filled by the affirmative vote of a majority of the
directors then in office, and the directors so elected shall hold office for the
balance of the unexpired term.
SECTION 3. The Chairman of the Board shall preside at meetings of the Board of
Directors. In his absence, the Chief Executive Officer or, in his absence, such
other director as the Board of Directors from time to time may designate shall
preside at such meetings.
SECTION 4. The Board of Directors may adopt such Rules and Regulations for the
conduct of its meetings and the management of the affairs of the Company as it
may deem proper, not inconsistent with the laws of the State of New York, or
these By-Laws, and all officers and employees shall strictly adhere to, and be
bound by, such Rules and Regulations.
SECTION 5. Regular meetings of the Board of Directors shall be held from time
to time on the third Tuesday of the month. If the day appointed for holding
such regular meetings shall be a legal holiday, the regular meeting to be held
on such day shall be held on the next business day thereafter. Special meetings
of the Board of Directors may be called upon at least two day's notice whenever
it may be deemed proper by the Chairman of the Board or, the Chief Executive
Officer or, in their absence, by such other director as the Board of Directors
may have designated pursuant to Section 3 of this Article, and shall be called
upon like notice whenever any three of the directors so request in writing.
SECTION 6. The compensation of directors as such or as members of committees
shall be fixed from time to time by resolution of the Board of Directors.
<PAGE>
ARTICLE III
COMMITTEES
SECTION 1. There shall be an Executive Committee of the Board consisting of not
less than five directors who shall be appointed annually by the Board of
Directors. The Chairman of the Board shall preside at meetings of the Executive
Committee. In his absence, the Chief Executive Officer or, in his absence, such
other member of the Committee as the Committee from time to time may designate
shall preside at such meetings.
The Executive Committee shall possess and exercise to the extent permitted by
law all of the powers of the Board of Directors, except when the latter is in
session, and shall keep minutes of its proceedings, which shall be presented to
the Board of Directors at its next subsequent meeting. All acts done and powers
and authority conferred by the Executive Committee from time to time shall be
and be deemed to be, and may be certified as being, the act and under the
authority of the Board of Directors.
A majority of the Committee shall constitute a quorum, but the Committee may act
only by the concurrent vote of not less than one-third of its members, at least
one of whom must be a director other than an officer. Any one or more directors,
even though not members of the Executive Committee, may attend any meeting of
the Committee, and the member or members of the Committee present, even though
less than a quorum, may designate any one or more of such directors as a
substitute or substitutes for any absent member or members of the Committee, and
each such substitute or substitutes shall be counted for quorum, voting, and all
other purposes as a member or members of the Committee.
SECTION 2. There shall be an Audit Committee appointed annually by resolution
adopted by a majority of the entire Board of Directors which shall consist of
such number of directors, who are not also officers of the Company, as may from
time to time be fixed by resolution adopted by the Board of Directors. The
Chairman shall be designated by the Board of Directors, who shall also from time
to time fix a quorum for meetings of the Committee. Such Committee shall
conduct the annual directors' examinations of the Company as required by the New
York State Banking Law; shall review the reports of all examinations made of the
Company by public authorities and report thereon to the Board of Directors; and
shall report to the Board of Directors such other matters as it deems advisable
with respect to the Company, its various departments and the conduct of its
operations.
In the performance of its duties, the Audit Committee may employ or retain, from
time to time, expert assistants, independent of the officers or personnel of the
Company, to make studies of the Company's assets and liabilities as the
Committee may request and to make an examination of the accounting and auditing
methods of the Company and its system of internal protective controls to the
extent considered necessary or advisable in order to determine that the
operations of the Company, including its fiduciary departments, are being
audited by the General Auditor in such a manner as to provide prudent and
adequate protection. The Committee also may direct the General Auditor to make
such investigation as it deems necessary or advisable with respect to the
Company, its various departments and the conduct of its operations. The
Committee shall hold regular quarterly meetings and during the intervals thereof
shall meet at other times on call of the Chairman.
<PAGE>
SECTION 3. The Board of Directors shall have the power to appoint any other
Committees as may seem necessary, and from time to time to suspend or continue
the powers and duties of such Committees. Each Committee appointed pursuant to
this Article shall serve at the pleasure of the Board of Directors.
ARTICLE IV
OFFICERS
SECTION 1. The Board of Directors shall elect from among their number a
Chairman of the Board and a Chief Executive Officer; and shall also elect a
President, and may also elect a Senior Vice Chairman, one or more Vice Chairmen,
one or more Executive Vice Presidents, one or more Senior Managing Directors,
one or more Managing Directors, one or more Senior Vice Presidents, one or more
Principals, one or more Vice Presidents, one or more General Managers, a
Secretary, a Controller, a Treasurer, a General Counsel, one or more Associate
General Counsels, a General Auditor, a General Credit Auditor, and one or more
Deputy Auditors, who need not be directors. The officers of the corporation may
also include such other officers or assistant officers as shall from time to
time be elected or appointed by the Board. The Chairman of the Board or the
Chief Executive Officer or, in their absence, the President, the Senior Vice
Chairman or any Vice Chairman, may from time to time appoint assistant officers.
All officers elected or appointed by the Board of Directors shall hold their
respective offices during the pleasure of the Board of Directors, and all
assistant officers shall hold office at the pleasure of the Board or the
Chairman of the Board or the Chief Executive Officer or, in their absence, the
President, the Senior Vice Chairman or any Vice Chairman. The Board of
Directors may require any and all officers and employees to give security for
the faithful performance of their duties.
SECTION 2. The Board of Directors shall designate the Chief Executive Officer
of the Company who may also hold the additional title of Chairman of the Board,
President, Senior Vice Chairman or Vice Chairman and such person shall have,
subject to the supervision and direction of the Board of Directors or the
Executive Committee, all of the powers vested in such Chief Executive Officer by
law or by these By-Laws, or which usually attach or pertain to such office. The
other officers shall have, subject to the supervision and direction of the Board
of Directors or the Executive Committee or the Chairman of the Board or, the
Chief Executive Officer, the powers vested by law or by these By-Laws in them as
holders of their respective offices and, in addition, shall perform such other
duties as shall be assigned to them by the Board of Directors or the Executive
Committee or the Chairman of the Board or the Chief Executive Officer.
The General Auditor shall be responsible, through the Audit Committee, to the
Board of Directors for the determination of the program of the internal audit
function and the evaluation of the adequacy of the system of internal controls.
Subject to the Board of Directors, the General Auditor shall have and may
exercise all the powers and shall perform all the duties usual to such office
and shall have such other powers as may be prescribed or assigned to him from
time to time by the Board of Directors or vested in him by law or by these By-
Laws. He shall perform such other duties and shall make such investigations,
examinations and reports as may be prescribed or required by the Audit
Committee. The General Auditor shall have unrestricted access to all records
and premises of the Company and shall delegate such authority to his
subordinates. He shall have the duty to report to the Audit Committee on all
matters concerning the internal audit
<PAGE>
program and the adequacy of the system of internal controls of the Company which
he deems advisable or which the Audit Committee may request. Additionally, the
General Auditor shall have the duty of reporting independently of all officers
of the Company to the Audit Committee at least quarterly on any matters
concerning the internal audit program and the adequacy of the system of internal
controls of the Company that should be brought to the attention of the directors
except those matters responsibility for which has been vested in the General
Credit Auditor. Should the General Auditor deem any matter to be of special
immediate importance, he shall report thereon forthwith to the Audit Committee.
The General Auditor shall report to the Chief Financial Officer only for
administrative purposes.
The General Credit Auditor shall be responsible to the Chief Executive Officer
and, through the Audit Committee, to the Board of Directors for the systems of
internal credit audit, shall perform such other duties as the Chief Executive
Officer may prescribe, and shall make such examinations and reports as may be
required by the Audit Committee. The General Credit Auditor shall have
unrestricted access to all records and may delegate such authority to
subordinates.
SECTION 3. The compensation of all officers shall be fixed under such plan or
plans of position evaluation and salary administration as shall be approved from
time to time by resolution of the Board of Directors.
SECTION 4. The Board of Directors, the Executive Committee, the Chairman of the
Board, the Chief Executive Officer or any person authorized for this purpose by
the Chief Executive Officer, shall appoint or engage all other employees and
agents and fix their compensation. The employment of all such employees and
agents shall continue during the pleasure of the Board of Directors or the
Executive Committee or the Chairman of the Board or the Chief Executive Officer
or any such authorized person; and the Board of Directors, the Executive
Committee, the Chairman of the Board, the Chief Executive Officer or any such
authorized person may discharge any such employees and agents at will.
<PAGE>
ARTICLE V
INDEMNIFICATION OF DIRECTORS, OFFICERS AND OTHERS
SECTION 1. The Company shall, to the fullest extent permitted by Section 7018
of the New York Banking Law, indemnify any person who is or was made, or
threatened to be made, a party to an action or proceeding, whether civil or
criminal, whether involving any actual or alleged breach of duty, neglect or
error, any accountability, or any actual or alleged misstatement, misleading
statement or other act or omission and whether brought or threatened in any
court or administrative or legislative body or agency, including an action by or
in the right of the Company to procure a judgment in its favor and an action by
or in the right of any other corporation of any type or kind, domestic or
foreign, or any partnership, joint venture, trust, employee benefit plan or
other enterprise, which any director or officer of the Company is servicing or
served in any capacity at the request of the Company by reason of the fact that
he, his testator or intestate, is or was a director or officer of the Company,
or is serving or served such other corporation, partnership, joint venture,
trust, employee benefit plan or other enterprise in any capacity, against
judgments, fines, amounts paid in settlement, and costs, charges and expenses,
including attorneys' fees, or any appeal therein; provided, however, that no
indemnification shall be provided to any such person if a judgment or other
final adjudication adverse to the director or officer establishes that (i) his
acts were committed in bad faith or were the result of active and deliberate
dishonesty and, in either case, were material to the cause of action so
adjudicated, or (ii) he personally gained in fact a financial profit or other
advantage to which he was not legally entitled.
SECTION 2. The Company may indemnify any other person to whom the Company is
permitted to provide indemnification or the advancement of expenses by
applicable law, whether pursuant to rights granted pursuant to, or provided by,
the New York Banking Law or other rights created by (i) a resolution of
stockholders, (ii) a resolution of directors, or (iii) an agreement providing
for such indemnification, it being expressly intended that these By-Laws
authorize the creation of other rights in any such manner.
SECTION 3. The Company shall, from time to time, reimburse or advance to any
person referred to in Section 1 the funds necessary for payment of expenses,
including attorneys' fees, incurred in connection with any action or proceeding
referred to in Section 1, upon receipt of a written undertaking by or on behalf
of such person to repay such amount(s) if a judgment or other final adjudication
adverse to the director or officer establishes that (i) his acts were committed
in bad faith or were the result of active and deliberate dishonesty and, in
either case, were material to the cause of action so adjudicated, or (ii) he
personally gained in fact a financial profit or other advantage to which he was
not legally entitled.
SECTION 4. Any director or officer of the Company serving (i) another
corporation, of which a majority of the shares entitled to vote in the election
of its directors is held by the Company, or (ii) any employee benefit plan of
the Company or any corporation referred to in clause (i) in any capacity shall
be deemed to be doing so at the request of the Company. In all other cases, the
provisions of this Article V will apply (i) only if the person serving another
corporation or any partnership, joint venture, trust, employee benefit plan or
other enterprise so served at the specific request of the Company, evidenced by
a written communication signed by the Chairman of the Board, the Chief Executive
Officer or the
<PAGE>
President, and (ii) only if and to the extent that, after making such efforts as
the Chairman of the Board, the Chief Executive Officer or the President shall
deem adequate in the circumstances, such person shall be unable to obtain
indemnification from such other enterprise or its insurer.
SECTION 5. Any person entitled to be indemnified or to the reimbursement or
advancement of expenses as a matter of right pursuant to this Article V may
elect to have the right to indemnification (or advancement of expenses)
interpreted on the basis of the applicable law in effect at the time of
occurrence of the event or events giving rise to the action or proceeding, to
the extent permitted by law, or on the basis of the applicable law in effect at
the time indemnification is sought.
SECTION 6. The right to be indemnified or to the reimbursement or advancement
of expense pursuant to this Article V (i) is a contract right pursuant to which
the person entitled thereto may bring suit as if the provisions hereof were set
forth in a separate written contract between the Company and the director or
officer, (ii) is intended to be retroactive and shall be available with respect
to events occurring prior to the adoption hereof, and (iii) shall continue to
exist after the rescission or restrictive modification hereof with respect to
events occurring prior thereto.
SECTION 7. If a request to be indemnified or for the reimbursement or
advancement of expenses pursuant hereto is not paid in full by the Company
within thirty days after a written claim has been received by the Company, the
claimant may at any time thereafter bring suit against the Company to recover
the unpaid amount of the claim and, if successful in whole or in part, the
claimant shall be entitled also to be paid the expenses of prosecuting such
claim. Neither the failure of the Company (including its Board of Directors,
independent legal counsel, or its stockholders) to have made a determination
prior to the commencement of such action that indemnification of or
reimbursement or advancement of expenses to the claimant is proper in the
circumstance, nor an actual determination by the Company (including its Board of
Directors, independent legal counsel, or its stockholders) that the claimant is
not entitled to indemnification or to the reimbursement or advancement of
expenses, shall be a defense to the action or create a presumption that the
claimant is not so entitled.
SECTION 8. A person who has been successful, on the merits or otherwise, in the
defense of a civil or criminal action or proceeding of the character described
in Section 1 shall be entitled to indemnification only as provided in Sections 1
and 3, notwithstanding any provision of the New York Banking Law to the
contrary.
<PAGE>
ARTICLE VI
SEAL
SECTION 1. The Board of Directors shall provide a seal for the Company, the
counterpart dies of which shall be in the charge of the Secretary of the Company
and such officers as the Chairman of the Board, the Chief Executive Officer or
the Secretary may from time to time direct in writing, to be affixed to
certificates of stock and other documents in accordance with the directions of
the Board of Directors or the Executive Committee.
SECTION 2. The Board of Directors may provide, in proper cases on a specified
occasion and for a specified transaction or transactions, for the use of a
printed or engraved facsimile seal of the Company.
ARTICLE VII
CAPITAL STOCK
SECTION 1. Registration of transfer of shares shall only be made upon the books
of the Company by the registered holder in person, or by power of attorney, duly
executed, witnessed and filed with the Secretary or other proper officer of the
Company, on the surrender of the certificate or certificates of such shares
properly assigned for transfer.
ARTICLE VIII
CONSTRUCTION
SECTION 1. The masculine gender, when appearing in these By-Laws, shall be
deemed to include the feminine gender.
ARTICLE IX
AMENDMENTS
SECTION 1. These By-Laws may be altered, amended or added to by the Board of
Directors at any meeting, or by the stockholders at any annual or special
meeting, provided notice thereof has been given.
<PAGE>
I, SusanJohnson, Assistant Vice President of Bankers Trust Company, New York,
------------
New York, hereby certify that the foregoing is a complete, true and correct copy
of the By-Laws of Bankers Trust Company, and that the same are in full force and
effect at this date.
Susan Johnson
------------------------
ASSISTANT VICE PRESIDENT
DATED: May 14, 1998
<PAGE>
<TABLE>
<CAPTION>
Legal Title of Bank: Bankers Trust Company Call Date: 12/31/97 ST-BK: 36-4840 FFIEC 031
Address: 130 Liberty Street Vendor ID: D CERT: 00623 Page RC-1
City, State ZIP: New York, NY 10006 11
FDIC Certificate No.: | 0 | 0 | 6 | 2 | 3
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for December 31, 1997
All schedules are to be reported in thousands of dollars. Unless otherwise indicated,
reported the amount outstanding as of the last business day of the quarter.
<S> <C> <C> <C>
Schedule RC--Balance Sheet
_______________
| C400 |
Dollar Amounts in Thousands |RCFD Bil Mil Thou |
ASSETS | / / / / / / / / / / / / /
1. Cash and balances due from depository institutions (from Schedule RC-A): | / / / / / / / / / / / / /
a. Noninterest-bearing balances and currency and coin (1) ............................... | 0081 2,121,000 |1.a.
b. Interest-bearing balances (2) ...........................................................| 0071 4,770,000 |1.b.
2. Securities: | / / / / / / / / / |
a. Held-to-maturity securities (from Schedule RC-B, column A) ....................... | 1754 0|2.a.
b. Available-for-sale securities (from Schedule RC-B, column D)...................... | 1773 4,015,000|2.b.
3. Federal funds sold and securities purchased under agreements to resell................. | 1350 28,927,000|3.
4. Loans and lease financing receivables: | / / / / / / / / / |
a. Loans and leases, net of unearned income (from Schedule RC-C) RCFD 2122 17,692,000 | / / / / / / / / / /|4.a.
b. LESS: Allowance for loan and lease losses........................RCFD 3123 659,000 | / / / / / / / / / /|4.b.
c. LESS: Allocated transfer risk reserve ...........................RCFD 3128 0 | / / / / / / / / / /|4.c.
d. Loans and leases, net of unearned income, | / / / / / / / / / /
allowance, and reserve (item 4.a minus 4.b and 4.c) ......................................| 2125 17,033,000|4.d.
5. Trading Assets (from schedule RC-D) ...........................................................| 3545 45,488,000 |5.
6. Premises and fixed assets (including capitalized leases) .......................................| 2145 766,000 |6.
7. Other real estate owned (from Schedule RC-M) ...................................................| 2150 188,000 |7.
8. Investments in unconsolidated subsidiaries and associated companies (from Schedule RC-M) | 2130 58,000 |8.
9. Customers' liability to this bank on acceptances outstanding .................................. | 2155 633,000 |9.
10. Intangible assets (from Schedule RC-M) .........................................................| 2143 83,000 |10.
11. Other assets (from Schedule RC-F) ..............................................................| 2160 5,957,000 |11.
12. Total assets (sum of items 1 through 11) .......................................................| 2170 110,039,000|12.
</TABLE>
__________________________
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
<PAGE>
<TABLE>
<CAPTION>
Legal Title of Bank: Bankers Trust Company Call Date: 12/31/97 ST-BK: 36-4840 FFIEC 031
Address: 130 Liberty Street Vendor ID: D CERT: 00623 Page RC-2
City, State Zip: New York, NY 10006 12
FDIC Certificate No.: | 0 | 0 | 6 | 2 | 3
<S> <C> <C> <C>
Schedule RC--Continued ____________________________
Dollar Amounts in Thousands | / / / / Bil Mil Thou __
LIABILITIES | / / / / / / / / / / /
13. Deposits: | / / / / / / / / / / /
a. In domestic offices (sum of totals of columns A and C from Schedule RC-E, part I) | RCON 2200 24,608,000
(1) Noninterest-bearing(1) ............................RCON 6631 2,856,000........ | / / / / / / / / / /
(2) Interest-bearing .................................. RCON 6636 21,752,000....... | / / / / / / / / / /
b. In foreign offices, Edge and Agreement subsidiaries, and IBFs (from Schedule RC-E | / / / / / / / / / /
part II) | RCFN 2200 20,529,000
(1) Noninterest-bearing .................................RCFN 6631 2,122,000| / / / / / / / / / /
(2) Interest-bearing ....................................RCFN 6636 18,407,000|
14. Federal funds purchased and securities sold under agreements to repurchase | RCFD 2800 13,777,000
15. a. Demand notes issued to the U.S. Treasury .............................................| RCON 2840 0
b. Trading liabilities (from Schedule RC-D)..............................................| RCFD 3548 24,968,000
16. Other borrowed money (includes mortgage indebtedness and obligations under capitalized leases): / / / / / / / / / /
a. With a remaining maturity of one year or less ........................................| RCFD 2332 5,810,000
b. With a remaining maturity of more than one year through three years..................| A547 4,702,000
c. With a remaining maturity of more than three years....................................| A548 1,750,000
17. Not Applicable.
18. Bank's liability on acceptances executed and outstanding ....................................| RCFD 2920 633,000
19. Subordinated notes and debentures (2)........................................................| RCFD 3200 1,307,000
20. Other liabilities (from Schedule RC-G) ......................................................| RCFD 2930 5,961,000
21. Total liabilities (sum of items 13 through 20) ..............................................| RCFD 2948 104,045,000
22. Not Applicable | / / / / / / / / / /
| / / / / / / / / / /
EQUITY CAPITAL | / / / / / / / / / /
23. Perpetual preferred stock and related surplus ...............................................| RCFD 3838 1,000,000
24. Common stock ................................................................................| RCFD 3230 1,352,000
25. Surplus (exclude all surplus related to preferred stock) ....................................| RCFD 3839 540,000
26. a. Undivided profits and capital reserves .................................................| RCFD 3632 3,526,000
b. Net unrealized holding gains (losses) on available-for-sale securities .................| RCFD 8434 ( 45,000)
27. Cumulative foreign currency translation adjustments .........................................| RCFD 3284 ( 379,000) |27.
28. Total equity capital (sum of items 23 through 27) ...........................................| RCFD 3210 5,994,000 |28.
29. Total liabilities and equity capital (sum of items 21 and 28)................................| RCFD 3300 110,039,000
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the statement below that best describes the
most comprehensive level of auditing work performed for the bank by independent external Number
auditors as of any date during 1996 .....................................| CFD 6724 N/A | M
</TABLE>
1 = Independent audit of the bank conducted in accordance
with generally accepted auditing standards by a certified
public accounting firm which submits a report on the bank
2 = Independent audit of the bank's parent holding company
conducted in accordance with generally accepted auditing
standards by a certified public accounting firm which
submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in
accordance with generally accepted auditing standards
by a certified public accounting firm (may be required by
state chartering authority)
4 = Directors' examination of the bank performed by other
external auditors (may be required by state chartering
authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external
auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
______________________
(1) Including total demand deposits and noninterest-bearing time and savings
deposits.
(2) Includes limited-life preferred stock and related surplus.
<PAGE>
Exhibit 25.4
UNITED STATES
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) ___________
______________________________
BANKERS TRUST COMPANY
(Exact name of trustee as specified in its charter)
NEW YORK 13-4941247
(Jurisdiction of Incorporation or (I.R.S. Employer
organization if not a U.S. national bank) Identification no.)
FOUR ALBANY STREET
NEW YORK, NEW YORK 10006
(Address of principal (Zip Code)
executive offices)
BANKERS TRUST COMPANY
LEGAL DEPARTMENT
130 LIBERTY STREET, 31ST FLOOR
NEW YORK, NEW YORK 10006
(212) 250-2201
(Name, address and telephone number of agent for service)
_________________________________
AMERICAN EXPRESS COMPANY
(Exact name of Registrant as specified in its charter)
NEW YORK 13-4922250
(State or other jurisdiction of (I.R.S. employer
Incorporation or organization) Identification no.)
200 VESEY STREET
NEW YORK, NEW YORK 10285
(Address, including zip code of
Principal executive offices)
GUARANTEE OF CAPITAL SECURITIES OF
AMERICAN EXPRESS COMPANY CAPITAL TRUST I
(Title of the indenture securities)
<PAGE>
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.
NAME ADDRESS
---- -------
Federal Reserve Bank (2nd District) New York, NY
Federal Deposit Insurance Corporation Washington, D.C.
New York State Banking Department Albany, NY
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
ITEM 2. AFFILIATIONS WITH OBLIGOR.
If the obligor is an affiliate of the Trustee, describe each such
affiliation.
None.
Item 3. -15. Not Applicable
ITEM 16. LIST OF EXHIBITS.
Exhibit 1 - Restated Organization Certificate of Bankers Trust
Company dated August 7, 1990, Certificate of Amendment of
the Organization Certificate of Bankers Trust Company dated
June 21, 1995 - Incorporated herein by reference to Exhibit
1 filed with Form T-1 Statement, Registration No. 33-65171,
Certificate of Amendment of the Organization Certificate of
Bankers Trust Company dated March 20, 1996, incorporate by
referenced to Exhibit 1 filed with Form T-1 Statement,
Registration No. 333-25843 and Certificate of Amendment of
the Organization Certificate of Bankers Trust Company dated
June 19, 1997, copy attached.
EXHIBIT 2 - Certificate of Authority to commence business -
Incorporated herein by reference to Exhibit 2 filed with
Form T-1 Statement, Registration No. 33-21047.
EXHIBIT 3 - Authorization of the Trustee to exercise corporate
trust powers - Incorporated herein by reference to Exhibit 2
filed with Form T-1 Statement, Registration No. 33-21047.
EXHIBIT 4 - Existing By-Laws of Bankers Trust Company, as amended on
November 18, 1997. Copy attached.
-2-
<PAGE>
EXHIBIT 5 - Not applicable.
EXHIBIT 6 - Consent of Bankers Trust Company required by Section
321(b) of the Act. - Incorporated herein by reference to
Exhibit 4 filed with Form T-1 Statement, Registration
No. 22-18864.
EXHIBIT 7 - The latest report of condition of Bankers Trust Company
dated as of December 31, 1997. Copy attached.
EXHIBIT 8 - Not Applicable.
EXHIBIT 9 - Not Applicable.
-3-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, Bankers Trust Company, 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 29th day
of May, 1998.
BANKERS TRUST COMPANY
By: /s/ Susan Johnson
-------------------------------
Susan Johnson
Assistant Vice President
-4-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, Bankers Trust Company, 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 29th day
of May, 1998.
BANKERS TRUST COMPANY
By: Susan Johnson
-------------
Susan Johnson
Assistant Vice President
-5-
<PAGE>
State of New York,
Banking Department
I, MANUEL KURSKY, Deputy Superintendent of Banks of the State of New York,
DO HEREBY APPROVE the annexed Certificate entitled "CERTIFICATE OF AMENDMENT OF
THE ORGANIZATION CERTIFICATE OF BANKERS TRUST COMPANY UNDER SECTION 8005 OF THE
BANKING LAW," dated June 19, 1997, providing for an increase in authorized
capital stock from $1,601,666,670 consisting of 100,166,667 shares with a par
value of $10 each designated as Common Stock and 600 shares with a par value of
$1,000,000 each designated as Series Preferred Stock to $2,001,666,670
consisting of 100,166,667 shares with a par value of $10 each designated as
Common Stock and 1,000 shares with a par value of $1,000,000 each designated as
Series Preferred Stock.
WITNESS, my hand and official seal of the Banking Department at the City of New
York,
this 27TH day of June in the Year of our Lord one
------- -----
thousand nine hundred and NINETY-SEVEN.
Manuel Kursky
--------------------------------
Deputy Superintendent of Banks
<PAGE>
CERTIFICATE OF AMENDMENT
OF THE
ORGANIZATION CERTIFICATE
OF BANKERS TRUST
Under Section 8005 of the Banking Law
_____________________________
We, James T. Byrne, Jr. and Lea Lahtinen, being respectively a Managing
Director and an Assistant Secretary of Bankers Trust Company, do hereby certify:
1. The name of the corporation is Bankers Trust Company.
2. The organization certificate of said corporation was filed by the
Superintendent of Banks on the 5th of march, 1903.
3. The organization certificate as heretofore amended is hereby amended
to increase the aggregate number of shares which the corporation shall have
authority to issue and to increase the amount of its authorized capital stock in
conformity therewith.
4. Article III of the organization certificate with reference to the
authorized capital stock, the number of shares into which the capital stock
shall be divided, the par value of the shares and the capital stock outstanding,
which reads as follows:
"III. The amount of capital stock which the corporation is hereafter to
have is One Billion, Six Hundred and One Million, Six Hundred Sixty-Six
Thousand, Six Hundred Seventy Dollars ($1,601,666,670), divided into One
Hundred Million, One Hundred Sixty-Six Thousand, Six Hundred Sixty-Seven
(100,166,667) shares with a par value of $10 each designated as Common
Stock and 600 shares with a par value of One Million Dollars ($1,000,000)
each designated as Series Preferred Stock."
is hereby amended to read as follows:
"III. The amount of capital stock which the corporation is hereafter to
have is Two Billion One Million, Six Hundred Sixty-Six Thousand, Six
Hundred Seventy Dollars ($2,001,666,670), divided into One Hundred Million,
One Hundred Sixty-Six Thousand, Six Hundred Sixty-Seven (100,166,667)
shares with a par value of $10 each designated as Common Stock and 1000
shares with a par value of One Million Dollars ($1,000,000) each designated
as Series Preferred Stock."
<PAGE>
5. The foregoing amendment of the organization certificate was authorized
by unanimous written consent signed by the holder of all outstanding shares
entitled to vote thereon.
IN WITNESS WHEREOF, we have made and subscribed this certificate this 19th
day of June, 1997.
James T. Byrne, Jr.
-------------------------
James T. Byrne, Jr.
Managing Director
Lea Lahtinen
-------------------------
Lea Lahtinen
Assistant Secretary
State of New York )
) ss:
County of New York )
Lea Lahtinen, being fully sworn, deposes and says that she is an Assistant
Secretary of Bankers Trust Company, the corporation described in the foregoing
certificate; that she has read the foregoing certificate and knows the contents
thereof, and that the statements herein contained are true.
Lea Lahtinen
-------------------------
Lea Lahtinen
Sworn to before me this 19th day
of June, 1997.
Sandra L. West
----------------------
Notary Public
SANDRA L. WEST
Notary Public State of New York
No. 31-4942101
Qualified in New York County
Commission Expires September 19, 1998
<PAGE>
BY-LAWS
NOVEMBER 18, 1997
BANKERS TRUST COMPANY
NEW YORK
<PAGE>
BY-LAWS
OF
BANKERS TRUST COMPANY
ARTICLE I
MEETINGS OF STOCKHOLDERS
SECTION 1. The annual meeting of the stockholders of this Company shall be held
at the office of the Company in the Borough of Manhattan, City of New York, on
the third Tuesday in January of each year, for the election of directors and
such other business as may properly come before said meeting.
SECTION 2. Special meetings of stockholders other than those regulated by
statute may be called at any time by a majority of the directors. It shall be
the duty of the Chairman of the Board, the Chief Executive Officer or the
President to call such meetings whenever requested in writing to do so by
stockholders owning a majority of the capital stock.
SECTION 3. At all meetings of stockholders, there shall be present, either in
person or by proxy, stockholders owning a majority of the capital stock of the
Company, in order to constitute a quorum, except at special elections of
directors, as provided by law, but less than a quorum shall have power to
adjourn any meeting.
SECTION 4. The Chairman of the Board or, in his absence, the Chief Executive
Officer or, in his absence, the President or, in their absence, the senior
officer present, shall preside at meetings of the stockholders and shall direct
the proceedings and the order of business. The Secretary shall act as secretary
of such meetings and record the proceedings.
ARTICLE II
DIRECTORS
SECTION 1. The affairs of the Company shall be managed and its corporate powers
exercised by a Board of Directors consisting of such number of directors, but
not less than ten nor more than twenty-five, as may from time to time be fixed
by resolution adopted by a majority of the directors then in office, or by the
stockholders. In the event of any increase in the number of directors,
additional directors may be elected within the limitations so fixed, either by
the stockholders or within the limitations imposed by law, by a majority of
directors then in office. One-third of the number of directors, as fixed from
time to time, shall constitute a quorum. Any one or more members of the Board
of Directors or any Committee thereof may participate in a meeting of the Board
of Directors or Committee thereof by means of a conference telephone or similar
communications equipment which allows all persons participating in the meeting
to hear each other at the same time. Participation by such means shall
constitute presence in person at such a meeting.
<PAGE>
All directors hereafter elected shall hold office until the next annual meeting
of the stockholders and until their successors are elected and have qualified.
No person who shall have attained age 72 shall be eligible to be elected or re-
elected a director. Such director may, however, remain a director of the
Company until the next annual meeting of the stockholders of Bankers Trust New
York Corporation (the Company's parent) so that such director's retirement will
coincide with the retirement date from Bankers Trust New York Corporation.
No Officer-Director who shall have attained age 65, or earlier relinquishes his
responsibilities and title, shall be eligible to serve as a director.
SECTION 2. Vacancies not exceeding one-third of the whole number of the Board
of Directors may be filled by the affirmative vote of a majority of the
directors then in office, and the directors so elected shall hold office for the
balance of the unexpired term.
SECTION 3. The Chairman of the Board shall preside at meetings of the Board of
Directors. In his absence, the Chief Executive Officer or, in his absence, such
other director as the Board of Directors from time to time may designate shall
preside at such meetings.
SECTION 4. The Board of Directors may adopt such Rules and Regulations for the
conduct of its meetings and the management of the affairs of the Company as it
may deem proper, not inconsistent with the laws of the State of New York, or
these By-Laws, and all officers and employees shall strictly adhere to, and be
bound by, such Rules and Regulations.
SECTION 5. Regular meetings of the Board of Directors shall be held from time
to time on the third Tuesday of the month. If the day appointed for holding
such regular meetings shall be a legal holiday, the regular meeting to be held
on such day shall be held on the next business day thereafter. Special meetings
of the Board of Directors may be called upon at least two day's notice whenever
it may be deemed proper by the Chairman of the Board or, the Chief Executive
Officer or, in their absence, by such other director as the Board of Directors
may have designated pursuant to Section 3 of this Article, and shall be called
upon like notice whenever any three of the directors so request in writing.
SECTION 6. The compensation of directors as such or as members of committees
shall be fixed from time to time by resolution of the Board of Directors.
<PAGE>
ARTICLE III
COMMITTEES
SECTION 1. There shall be an Executive Committee of the Board consisting of not
less than five directors who shall be appointed annually by the Board of
Directors. The Chairman of the Board shall preside at meetings of the Executive
Committee. In his absence, the Chief Executive Officer or, in his absence, such
other member of the Committee as the Committee from time to time may designate
shall preside at such meetings.
The Executive Committee shall possess and exercise to the extent permitted by
law all of the powers of the Board of Directors, except when the latter is in
session, and shall keep minutes of its proceedings, which shall be presented to
the Board of Directors at its next subsequent meeting. All acts done and powers
and authority conferred by the Executive Committee from time to time shall be
and be deemed to be, and may be certified as being, the act and under the
authority of the Board of Directors.
A majority of the Committee shall constitute a quorum, but the Committee may act
only by the concurrent vote of not less than one-third of its members, at least
one of whom must be a director other than an officer. Any one or more directors,
even though not members of the Executive Committee, may attend any meeting of
the Committee, and the member or members of the Committee present, even though
less than a quorum, may designate any one or more of such directors as a
substitute or substitutes for any absent member or members of the Committee, and
each such substitute or substitutes shall be counted for quorum, voting, and all
other purposes as a member or members of the Committee.
SECTION 2. There shall be an Audit Committee appointed annually by resolution
adopted by a majority of the entire Board of Directors which shall consist of
such number of directors, who are not also officers of the Company, as may from
time to time be fixed by resolution adopted by the Board of Directors. The
Chairman shall be designated by the Board of Directors, who shall also from time
to time fix a quorum for meetings of the Committee. Such Committee shall
conduct the annual directors' examinations of the Company as required by the New
York State Banking Law; shall review the reports of all examinations made of the
Company by public authorities and report thereon to the Board of Directors; and
shall report to the Board of Directors such other matters as it deems advisable
with respect to the Company, its various departments and the conduct of its
operations.
In the performance of its duties, the Audit Committee may employ or retain, from
time to time, expert assistants, independent of the officers or personnel of the
Company, to make studies of the Company's assets and liabilities as the
Committee may request and to make an examination of the accounting and auditing
methods of the Company and its system of internal protective controls to the
extent considered necessary or advisable in order to determine that the
operations of the Company, including its fiduciary departments, are being
audited by the General Auditor in such a manner as to provide prudent and
adequate protection. The Committee also may direct the General Auditor to make
such investigation as it deems necessary or advisable with respect to the
Company, its various departments and the conduct of its operations. The
Committee shall hold regular quarterly meetings and during the intervals thereof
shall meet at other times on call of the Chairman.
<PAGE>
SECTION 3. The Board of Directors shall have the power to appoint any other
Committees as may seem necessary, and from time to time to suspend or continue
the powers and duties of such Committees. Each Committee appointed pursuant to
this Article shall serve at the pleasure of the Board of Directors.
ARTICLE IV
OFFICERS
SECTION 1. The Board of Directors shall elect from among their number a
Chairman of the Board and a Chief Executive Officer; and shall also elect a
President, and may also elect a Senior Vice Chairman, one or more Vice Chairmen,
one or more Executive Vice Presidents, one or more Senior Managing Directors,
one or more Managing Directors, one or more Senior Vice Presidents, one or more
Principals, one or more Vice Presidents, one or more General Managers, a
Secretary, a Controller, a Treasurer, a General Counsel, one or more Associate
General Counsels, a General Auditor, a General Credit Auditor, and one or more
Deputy Auditors, who need not be directors. The officers of the corporation may
also include such other officers or assistant officers as shall from time to
time be elected or appointed by the Board. The Chairman of the Board or the
Chief Executive Officer or, in their absence, the President, the Senior Vice
Chairman or any Vice Chairman, may from time to time appoint assistant officers.
All officers elected or appointed by the Board of Directors shall hold their
respective offices during the pleasure of the Board of Directors, and all
assistant officers shall hold office at the pleasure of the Board or the
Chairman of the Board or the Chief Executive Officer or, in their absence, the
President, the Senior Vice Chairman or any Vice Chairman. The Board of
Directors may require any and all officers and employees to give security for
the faithful performance of their duties.
SECTION 2. The Board of Directors shall designate the Chief Executive Officer
of the Company who may also hold the additional title of Chairman of the Board,
President, Senior Vice Chairman or Vice Chairman and such person shall have,
subject to the supervision and direction of the Board of Directors or the
Executive Committee, all of the powers vested in such Chief Executive Officer by
law or by these By-Laws, or which usually attach or pertain to such office. The
other officers shall have, subject to the supervision and direction of the Board
of Directors or the Executive Committee or the Chairman of the Board or, the
Chief Executive Officer, the powers vested by law or by these By-Laws in them as
holders of their respective offices and, in addition, shall perform such other
duties as shall be assigned to them by the Board of Directors or the Executive
Committee or the Chairman of the Board or the Chief Executive Officer.
The General Auditor shall be responsible, through the Audit Committee, to the
Board of Directors for the determination of the program of the internal audit
function and the evaluation of the adequacy of the system of internal controls.
Subject to the Board of Directors, the General Auditor shall have and may
exercise all the powers and shall perform all the duties usual to such office
and shall have such other powers as may be prescribed or assigned to him from
time to time by the Board of Directors or vested in him by law or by these By-
Laws. He shall perform such other duties and shall make such investigations,
examinations and reports as may be prescribed or required by the Audit
Committee. The General Auditor shall have unrestricted access to all records
and premises of the Company and shall delegate such authority to his
subordinates. He shall have the duty to report to the Audit Committee on all
matters concerning the internal audit
<PAGE>
program and the adequacy of the system of internal controls of the Company which
he deems advisable or which the Audit Committee may request. Additionally, the
General Auditor shall have the duty of reporting independently of all officers
of the Company to the Audit Committee at least quarterly on any matters
concerning the internal audit program and the adequacy of the system of internal
controls of the Company that should be brought to the attention of the directors
except those matters responsibility for which has been vested in the General
Credit Auditor. Should the General Auditor deem any matter to be of special
immediate importance, he shall report thereon forthwith to the Audit Committee.
The General Auditor shall report to the Chief Financial Officer only for
administrative purposes.
The General Credit Auditor shall be responsible to the Chief Executive Officer
and, through the Audit Committee, to the Board of Directors for the systems of
internal credit audit, shall perform such other duties as the Chief Executive
Officer may prescribe, and shall make such examinations and reports as may be
required by the Audit Committee. The General Credit Auditor shall have
unrestricted access to all records and may delegate such authority to
subordinates.
SECTION 3. The compensation of all officers shall be fixed under such plan or
plans of position evaluation and salary administration as shall be approved from
time to time by resolution of the Board of Directors.
SECTION 4. The Board of Directors, the Executive Committee, the Chairman of the
Board, the Chief Executive Officer or any person authorized for this purpose by
the Chief Executive Officer, shall appoint or engage all other employees and
agents and fix their compensation. The employment of all such employees and
agents shall continue during the pleasure of the Board of Directors or the
Executive Committee or the Chairman of the Board or the Chief Executive Officer
or any such authorized person; and the Board of Directors, the Executive
Committee, the Chairman of the Board, the Chief Executive Officer or any such
authorized person may discharge any such employees and agents at will.
<PAGE>
ARTICLE V
INDEMNIFICATION OF DIRECTORS, OFFICERS AND OTHERS
SECTION 1. The Company shall, to the fullest extent permitted by Section 7018
of the New York Banking Law, indemnify any person who is or was made, or
threatened to be made, a party to an action or proceeding, whether civil or
criminal, whether involving any actual or alleged breach of duty, neglect or
error, any accountability, or any actual or alleged misstatement, misleading
statement or other act or omission and whether brought or threatened in any
court or administrative or legislative body or agency, including an action by or
in the right of the Company to procure a judgment in its favor and an action by
or in the right of any other corporation of any type or kind, domestic or
foreign, or any partnership, joint venture, trust, employee benefit plan or
other enterprise, which any director or officer of the Company is servicing or
served in any capacity at the request of the Company by reason of the fact that
he, his testator or intestate, is or was a director or officer of the Company,
or is serving or served such other corporation, partnership, joint venture,
trust, employee benefit plan or other enterprise in any capacity, against
judgments, fines, amounts paid in settlement, and costs, charges and expenses,
including attorneys' fees, or any appeal therein; provided, however, that no
indemnification shall be provided to any such person if a judgment or other
final adjudication adverse to the director or officer establishes that (i) his
acts were committed in bad faith or were the result of active and deliberate
dishonesty and, in either case, were material to the cause of action so
adjudicated, or (ii) he personally gained in fact a financial profit or other
advantage to which he was not legally entitled.
SECTION 2. The Company may indemnify any other person to whom the Company is
permitted to provide indemnification or the advancement of expenses by
applicable law, whether pursuant to rights granted pursuant to, or provided by,
the New York Banking Law or other rights created by (i) a resolution of
stockholders, (ii) a resolution of directors, or (iii) an agreement providing
for such indemnification, it being expressly intended that these By-Laws
authorize the creation of other rights in any such manner.
SECTION 3. The Company shall, from time to time, reimburse or advance to any
person referred to in Section 1 the funds necessary for payment of expenses,
including attorneys' fees, incurred in connection with any action or proceeding
referred to in Section 1, upon receipt of a written undertaking by or on behalf
of such person to repay such amount(s) if a judgment or other final adjudication
adverse to the director or officer establishes that (i) his acts were committed
in bad faith or were the result of active and deliberate dishonesty and, in
either case, were material to the cause of action so adjudicated, or (ii) he
personally gained in fact a financial profit or other advantage to which he was
not legally entitled.
SECTION 4. Any director or officer of the Company serving (i) another
corporation, of which a majority of the shares entitled to vote in the election
of its directors is held by the Company, or (ii) any employee benefit plan of
the Company or any corporation referred to in clause (i) in any capacity shall
be deemed to be doing so at the request of the Company. In all other cases, the
provisions of this Article V will apply (i) only if the person serving another
corporation or any partnership, joint venture, trust, employee benefit plan or
other enterprise so served at the specific request of the Company, evidenced by
a written communication signed by the Chairman of the Board, the Chief Executive
Officer or the
<PAGE>
President, and (ii) only if and to the extent that, after making such efforts as
the Chairman of the Board, the Chief Executive Officer or the President shall
deem adequate in the circumstances, such person shall be unable to obtain
indemnification from such other enterprise or its insurer.
SECTION 5. Any person entitled to be indemnified or to the reimbursement or
advancement of expenses as a matter of right pursuant to this Article V may
elect to have the right to indemnification (or advancement of expenses)
interpreted on the basis of the applicable law in effect at the time of
occurrence of the event or events giving rise to the action or proceeding, to
the extent permitted by law, or on the basis of the applicable law in effect at
the time indemnification is sought.
SECTION 6. The right to be indemnified or to the reimbursement or advancement
of expense pursuant to this Article V (i) is a contract right pursuant to which
the person entitled thereto may bring suit as if the provisions hereof were set
forth in a separate written contract between the Company and the director or
officer, (ii) is intended to be retroactive and shall be available with respect
to events occurring prior to the adoption hereof, and (iii) shall continue to
exist after the rescission or restrictive modification hereof with respect to
events occurring prior thereto.
SECTION 7. If a request to be indemnified or for the reimbursement or
advancement of expenses pursuant hereto is not paid in full by the Company
within thirty days after a written claim has been received by the Company, the
claimant may at any time thereafter bring suit against the Company to recover
the unpaid amount of the claim and, if successful in whole or in part, the
claimant shall be entitled also to be paid the expenses of prosecuting such
claim. Neither the failure of the Company (including its Board of Directors,
independent legal counsel, or its stockholders) to have made a determination
prior to the commencement of such action that indemnification of or
reimbursement or advancement of expenses to the claimant is proper in the
circumstance, nor an actual determination by the Company (including its Board of
Directors, independent legal counsel, or its stockholders) that the claimant is
not entitled to indemnification or to the reimbursement or advancement of
expenses, shall be a defense to the action or create a presumption that the
claimant is not so entitled.
SECTION 8. A person who has been successful, on the merits or otherwise, in the
defense of a civil or criminal action or proceeding of the character described
in Section 1 shall be entitled to indemnification only as provided in Sections 1
and 3, notwithstanding any provision of the New York Banking Law to the
contrary.
<PAGE>
ARTICLE VI
SEAL
SECTION 1. The Board of Directors shall provide a seal for the Company, the
counterpart dies of which shall be in the charge of the Secretary of the Company
and such officers as the Chairman of the Board, the Chief Executive Officer or
the Secretary may from time to time direct in writing, to be affixed to
certificates of stock and other documents in accordance with the directions of
the Board of Directors or the Executive Committee.
SECTION 2. The Board of Directors may provide, in proper cases on a specified
occasion and for a specified transaction or transactions, for the use of a
printed or engraved facsimile seal of the Company.
ARTICLE VII
CAPITAL STOCK
SECTION 1. Registration of transfer of shares shall only be made upon the books
of the Company by the registered holder in person, or by power of attorney, duly
executed, witnessed and filed with the Secretary or other proper officer of the
Company, on the surrender of the certificate or certificates of such shares
properly assigned for transfer.
ARTICLE VIII
CONSTRUCTION
SECTION 1. The masculine gender, when appearing in these By-Laws, shall be
deemed to include the feminine gender.
ARTICLE IX
AMENDMENTS
SECTION 1. These By-Laws may be altered, amended or added to by the Board of
Directors at any meeting, or by the stockholders at any annual or special
meeting, provided notice thereof has been given.
<PAGE>
I, SusanJohnson, Assistant Vice President of Bankers Trust Company, New York,
------------
New York, hereby certify that the foregoing is a complete, true and correct copy
of the By-Laws of Bankers Trust Company, and that the same are in full force and
effect at this date.
Susan Johnson
--------------------------------------
ASSISTANT VICE PRESIDENT
DATED: May 14, 1998
<PAGE>
<TABLE>
<CAPTION>
Legal Title of Bank: Bankers Trust Company Call Date: 12/31/97 ST-BK: 36-4840 FFIEC 031
Address: 130 Liberty Street Vendor ID: D CERT: 00623 Page RC-1
City, State ZIP: New York, NY 10006 11
FDIC Certificate No.: | 0 | 0 | 6 | 2 | 3
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for December 31, 1997
All schedules are to be reported in thousands of dollars. Unless otherwise indicated,
reported the amount outstanding as of the last business day of the quarter.
<S> <C> <C> <C>
Schedule RC--Balance Sheet
_______________
| C400 |
Dollar Amounts in Thousands |RCFD Bil Mil Thou |
ASSETS | / / / / / / / / / / / / /
1. Cash and balances due from depository institutions (from Schedule RC-A): | / / / / / / / / / / / / /
a. Noninterest-bearing balances and currency and coin (1) ............................... | 0081 2,121,000 |1.a.
b. Interest-bearing balances (2) ...........................................................| 0071 4,770,000 |1.b.
2. Securities: | / / / / / / / / / |
a. Held-to-maturity securities (from Schedule RC-B, column A) ....................... | 1754 0|2.a.
b. Available-for-sale securities (from Schedule RC-B, column D)...................... | 1773 4,015,000|2.b.
3. Federal funds sold and securities purchased under agreements to resell................. | 1350 28,927,000|3.
4. Loans and lease financing receivables: | / / / / / / / / / |
a. Loans and leases, net of unearned income (from Schedule RC-C) RCFD 2122 17,692,000 | / / / / / / / / / /|4.a.
b. LESS: Allowance for loan and lease losses........................RCFD 3123 659,000 | / / / / / / / / / /|4.b.
c. LESS: Allocated transfer risk reserve ...........................RCFD 3128 0 | / / / / / / / / / /|4.c.
d. Loans and leases, net of unearned income, | / / / / / / / / / /
allowance, and reserve (item 4.a minus 4.b and 4.c) ......................................| 2125 17,033,000|4.d.
5. Trading Assets (from schedule RC-D) ...........................................................| 3545 45,488,000 |5.
6. Premises and fixed assets (including capitalized leases) .......................................| 2145 766,000 |6.
7. Other real estate owned (from Schedule RC-M) ...................................................| 2150 188,000 |7.
8. Investments in unconsolidated subsidiaries and associated companies (from Schedule RC-M) | 2130 58,000 |8.
9. Customers' liability to this bank on acceptances outstanding .................................. | 2155 633,000 |9.
10. Intangible assets (from Schedule RC-M) .........................................................| 2143 83,000 |10.
11. Other assets (from Schedule RC-F) ..............................................................| 2160 5,957,000 |11.
12. Total assets (sum of items 1 through 11) .......................................................| 2170 110,039,000|12.
</TABLE>
__________________________
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
<PAGE>
<TABLE>
<CAPTION>
Legal Title of Bank: Bankers Trust Company Call Date: 12/31/97 ST-BK: 36-4840 FFIEC 031
Address: 130 Liberty Street Vendor ID: D CERT: 00623 Page RC-2
City, State Zip: New York, NY 10006 12
FDIC Certificate No.: | 0 | 0 | 6 | 2 | 3
<S> <C> <C> <C>
Schedule RC--Continued ____________________________
Dollar Amounts in Thousands | / / / / Bil Mil Thou __
LIABILITIES | / / / / / / / / / / /
13. Deposits: | / / / / / / / / / / /
a. In domestic offices (sum of totals of columns A and C from Schedule RC-E, part I) | RCON 2200 24,608,000
(1) Noninterest-bearing(1) ............................RCON 6631 2,856,000........ | / / / / / / / / / /
(2) Interest-bearing .................................. RCON 6636 21,752,000....... | / / / / / / / / / /
b. In foreign offices, Edge and Agreement subsidiaries, and IBFs (from Schedule RC-E | / / / / / / / / / /
part II) | RCFN 2200 20,529,000
(1) Noninterest-bearing .................................RCFN 6631 2,122,000| / / / / / / / / / /
(2) Interest-bearing ....................................RCFN 6636 18,407,000|
14. Federal funds purchased and securities sold under agreements to repurchase | RCFD 2800 13,777,000
15. a. Demand notes issued to the U.S. Treasury .............................................| RCON 2840 0
b. Trading liabilities (from Schedule RC-D)..............................................| RCFD 3548 24,968,000
16. Other borrowed money (includes mortgage indebtedness and obligations under capitalized leases): / / / / / / / / / /
a. With a remaining maturity of one year or less ........................................| RCFD 2332 5,810,000
b. With a remaining maturity of more than one year through three years..................| A547 4,702,000
c. With a remaining maturity of more than three years....................................| A548 1,750,000
17. Not Applicable.
18. Bank's liability on acceptances executed and outstanding ....................................| RCFD 2920 633,000
19. Subordinated notes and debentures (2)........................................................| RCFD 3200 1,307,000
20. Other liabilities (from Schedule RC-G) ......................................................| RCFD 2930 5,961,000
21. Total liabilities (sum of items 13 through 20) ..............................................| RCFD 2948 104,045,000
22. Not Applicable | / / / / / / / / / /
| / / / / / / / / / /
EQUITY CAPITAL | / / / / / / / / / /
23. Perpetual preferred stock and related surplus ...............................................| RCFD 3838 1,000,000
24. Common stock ................................................................................| RCFD 3230 1,352,000
25. Surplus (exclude all surplus related to preferred stock) ....................................| RCFD 3839 540,000
26. a. Undivided profits and capital reserves .................................................| RCFD 3632 3,526,000
b. Net unrealized holding gains (losses) on available-for-sale securities .................| RCFD 8434 ( 45,000)
27. Cumulative foreign currency translation adjustments .........................................| RCFD 3284 ( 379,000) |27.
28. Total equity capital (sum of items 23 through 27) ...........................................| RCFD 3210 5,994,000 |28.
29. Total liabilities and equity capital (sum of items 21 and 28)................................| RCFD 3300 110,039,000
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the statement below that best describes the
most comprehensive level of auditing work performed for the bank by independent external Number
auditors as of any date during 1996 .....................................| CFD 6724 N/A | M
</TABLE>
1 = Independent audit of the bank conducted in accordance
with generally accepted auditing standards by a certified
public accounting firm which submits a report on the bank
2 = Independent audit of the bank's parent holding company
conducted in accordance with generally accepted auditing
standards by a certified public accounting firm which
submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in
accordance with generally accepted auditing standards
by a certified public accounting firm (may be required by
state chartering authority)
4 = Directors' examination of the bank performed by other
external auditors (may be required by state chartering
authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external
auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
______________________
(1) Including total demand deposits and noninterest-bearing time and savings
deposits.
(2) Includes limited-life preferred stock and related surplus.
<PAGE>
Exhibit 25.5
UNITED STATES
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) ___________
______________________________
BANKERS TRUST COMPANY
(Exact name of trustee as specified in its charter)
NEW YORK 13-4941247
(Jurisdiction of Incorporation or (I.R.S. Employer
organization if not a U.S. national bank) Identification no.)
FOUR ALBANY STREET
NEW YORK, NEW YORK 10006
(Address of principal (Zip Code)
executive offices)
BANKERS TRUST COMPANY
LEGAL DEPARTMENT
130 LIBERTY STREET, 31ST FLOOR
NEW YORK, NEW YORK 10006
(212) 250-2201
(Name, address and telephone number of agent for service)
_________________________________
AMERICAN EXPRESS COMPANY
(Exact name of Registrant as specified in its charter)
NEW YORK 13-4922250
(State or other jurisdiction of (I.R.S. employer
Incorporation or organization) Identification no.)
200 VESEY STREET
NEW YORK, NEW YORK 10285
(Address, including zip code of
Principal executive offices)
GUARANTEE OF CAPITAL SECURITIES OF
AMERICAN EXPRESS COMPANY CAPITAL TRUST II
(Title of the indenture securities)
<PAGE>
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.
NAME ADDRESS
---- -------
Federal Reserve Bank (2nd District) New York, NY
Federal Deposit Insurance Corporation Washington, D.C.
New York State Banking Department Albany, NY
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
ITEM 2. AFFILIATIONS WITH OBLIGOR.
If the obligor is an affiliate of the Trustee, describe each such
affiliation.
None.
Item 3. -15. Not Applicable
ITEM 16. LIST OF EXHIBITS.
Exhibit 1 - Restated Organization Certificate of Bankers Trust
Company dated August 7, 1990, Certificate of Amendment of
the Organization Certificate of Bankers Trust Company dated
June 21, 1995 - Incorporated herein by reference to Exhibit
1 filed with Form T-1 Statement, Registration No. 33-65171,
Certificate of Amendment of the Organization Certificate of
Bankers Trust Company dated March 20, 1996, incorporate by
referenced to Exhibit 1 filed with Form T-1 Statement,
Registration No. 333-25843 and Certificate of Amendment of
the Organization Certificate of Bankers Trust Company dated
June 19, 1997, copy attached.
EXHIBIT 2 - Certificate of Authority to commence business -
Incorporated herein by reference to Exhibit 2 filed with
Form T-1 Statement, Registration No. 33-21047.
EXHIBIT 3 - Authorization of the Trustee to exercise corporate
trust powers - Incorporated herein by reference to Exhibit 2
filed with Form T-1 Statement, Registration No. 33-21047.
EXHIBIT 4 - Existing By-Laws of Bankers Trust Company, as amended on
November 18, 1997. Copy attached.
-2-
<PAGE>
EXHIBIT 5 - Not applicable.
EXHIBIT 6 - Consent of Bankers Trust Company required by Section
321(b) of the Act. - Incorporated herein by reference to
Exhibit 4 filed with Form T-1 Statement, Registration
No. 22-18864.
EXHIBIT 7 - The latest report of condition of Bankers Trust Company
dated as of December 31, 1997. Copy attached.
EXHIBIT 8 - Not Applicable.
EXHIBIT 9 - Not Applicable.
-3-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, Bankers Trust Company, 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 29th day
of May, 1998.
BANKERS TRUST COMPANY
By: /s/ Susan Johnson
---------------------------
Susan Johnson
Assistant Vice President
-4-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, Bankers Trust Company, 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 29th day
of May, 1998.
BANKERS TRUST COMPANY
By: Susan Johnson
-------------
Susan Johnson
Assistant Vice President
-5-
<PAGE>
State of New York,
Banking Department
I, MANUEL KURSKY, Deputy Superintendent of Banks of the State of New York,
DO HEREBY APPROVE the annexed Certificate entitled "CERTIFICATE OF AMENDMENT OF
THE ORGANIZATION CERTIFICATE OF BANKERS TRUST COMPANY UNDER SECTION 8005 OF THE
BANKING LAW," dated June 19, 1997, providing for an increase in authorized
capital stock from $1,601,666,670 consisting of 100,166,667 shares with a par
value of $10 each designated as Common Stock and 600 shares with a par value of
$1,000,000 each designated as Series Preferred Stock to $2,001,666,670
consisting of 100,166,667 shares with a par value of $10 each designated as
Common Stock and 1,000 shares with a par value of $1,000,000 each designated as
Series Preferred Stock.
WITNESS, my hand and official seal of the Banking Department at the City of New
York,
this 27TH day of June in the Year of our Lord one
------- -----
thousand nine hundred and NINETY-SEVEN.
Manuel Kursky
------------------------------
Deputy Superintendent of Banks
<PAGE>
CERTIFICATE OF AMENDMENT
OF THE
ORGANIZATION CERTIFICATE
OF BANKERS TRUST
Under Section 8005 of the Banking Law
_____________________________
We, James T. Byrne, Jr. and Lea Lahtinen, being respectively a Managing
Director and an Assistant Secretary of Bankers Trust Company, do hereby certify:
1. The name of the corporation is Bankers Trust Company.
2. The organization certificate of said corporation was filed by the
Superintendent of Banks on the 5th of march, 1903.
3. The organization certificate as heretofore amended is hereby amended
to increase the aggregate number of shares which the corporation shall have
authority to issue and to increase the amount of its authorized capital stock in
conformity therewith.
4. Article III of the organization certificate with reference to the
authorized capital stock, the number of shares into which the capital stock
shall be divided, the par value of the shares and the capital stock outstanding,
which reads as follows:
"III. The amount of capital stock which the corporation is hereafter to
have is One Billion, Six Hundred and One Million, Six Hundred Sixty-Six
Thousand, Six Hundred Seventy Dollars ($1,601,666,670), divided into One
Hundred Million, One Hundred Sixty-Six Thousand, Six Hundred Sixty-Seven
(100,166,667) shares with a par value of $10 each designated as Common
Stock and 600 shares with a par value of One Million Dollars ($1,000,000)
each designated as Series Preferred Stock."
is hereby amended to read as follows:
"III. The amount of capital stock which the corporation is hereafter to
have is Two Billion One Million, Six Hundred Sixty-Six Thousand, Six
Hundred Seventy Dollars ($2,001,666,670), divided into One Hundred Million,
One Hundred Sixty-Six Thousand, Six Hundred Sixty-Seven (100,166,667)
shares with a par value of $10 each designated as Common Stock and 1000
shares with a par value of One Million Dollars ($1,000,000) each designated
as Series Preferred Stock."
<PAGE>
5. The foregoing amendment of the organization certificate was authorized
by unanimous written consent signed by the holder of all outstanding shares
entitled to vote thereon.
IN WITNESS WHEREOF, we have made and subscribed this certificate this 19th
day of June, 1997.
James T. Byrne, Jr.
-------------------------
James T. Byrne, Jr.
Managing Director
Lea Lahtinen
-------------------------
Lea Lahtinen
Assistant Secretary
State of New York )
) ss:
County of New York )
Lea Lahtinen, being fully sworn, deposes and says that she is an Assistant
Secretary of Bankers Trust Company, the corporation described in the foregoing
certificate; that she has read the foregoing certificate and knows the contents
thereof, and that the statements herein contained are true.
Lea Lahtinen
-------------------------
Lea Lahtinen
Sworn to before me this 19th day
of June, 1997.
Sandra L. West
---------------------
Notary Public
SANDRA L. WEST
Notary Public State of New York
No. 31-4942101
Qualified in New York County
Commission Expires September 19, 1998
<PAGE>
BY-LAWS
NOVEMBER 18, 1997
BANKERS TRUST COMPANY
NEW YORK
<PAGE>
BY-LAWS
OF
BANKERS TRUST COMPANY
ARTICLE I
MEETINGS OF STOCKHOLDERS
SECTION 1. The annual meeting of the stockholders of this Company shall be held
at the office of the Company in the Borough of Manhattan, City of New York, on
the third Tuesday in January of each year, for the election of directors and
such other business as may properly come before said meeting.
SECTION 2. Special meetings of stockholders other than those regulated by
statute may be called at any time by a majority of the directors. It shall be
the duty of the Chairman of the Board, the Chief Executive Officer or the
President to call such meetings whenever requested in writing to do so by
stockholders owning a majority of the capital stock.
SECTION 3. At all meetings of stockholders, there shall be present, either in
person or by proxy, stockholders owning a majority of the capital stock of the
Company, in order to constitute a quorum, except at special elections of
directors, as provided by law, but less than a quorum shall have power to
adjourn any meeting.
SECTION 4. The Chairman of the Board or, in his absence, the Chief Executive
Officer or, in his absence, the President or, in their absence, the senior
officer present, shall preside at meetings of the stockholders and shall direct
the proceedings and the order of business. The Secretary shall act as secretary
of such meetings and record the proceedings.
ARTICLE II
DIRECTORS
SECTION 1. The affairs of the Company shall be managed and its corporate powers
exercised by a Board of Directors consisting of such number of directors, but
not less than ten nor more than twenty-five, as may from time to time be fixed
by resolution adopted by a majority of the directors then in office, or by the
stockholders. In the event of any increase in the number of directors,
additional directors may be elected within the limitations so fixed, either by
the stockholders or within the limitations imposed by law, by a majority of
directors then in office. One-third of the number of directors, as fixed from
time to time, shall constitute a quorum. Any one or more members of the Board
of Directors or any Committee thereof may participate in a meeting of the Board
of Directors or Committee thereof by means of a conference telephone or similar
communications equipment which allows all persons participating in the meeting
to hear each other at the same time. Participation by such means shall
constitute presence in person at such a meeting.
<PAGE>
All directors hereafter elected shall hold office until the next annual meeting
of the stockholders and until their successors are elected and have qualified.
No person who shall have attained age 72 shall be eligible to be elected or re-
elected a director. Such director may, however, remain a director of the
Company until the next annual meeting of the stockholders of Bankers Trust New
York Corporation (the Company's parent) so that such director's retirement will
coincide with the retirement date from Bankers Trust New York Corporation.
No Officer-Director who shall have attained age 65, or earlier relinquishes his
responsibilities and title, shall be eligible to serve as a director.
SECTION 2. Vacancies not exceeding one-third of the whole number of the Board
of Directors may be filled by the affirmative vote of a majority of the
directors then in office, and the directors so elected shall hold office for the
balance of the unexpired term.
SECTION 3. The Chairman of the Board shall preside at meetings of the Board of
Directors. In his absence, the Chief Executive Officer or, in his absence, such
other director as the Board of Directors from time to time may designate shall
preside at such meetings.
SECTION 4. The Board of Directors may adopt such Rules and Regulations for the
conduct of its meetings and the management of the affairs of the Company as it
may deem proper, not inconsistent with the laws of the State of New York, or
these By-Laws, and all officers and employees shall strictly adhere to, and be
bound by, such Rules and Regulations.
SECTION 5. Regular meetings of the Board of Directors shall be held from time
to time on the third Tuesday of the month. If the day appointed for holding
such regular meetings shall be a legal holiday, the regular meeting to be held
on such day shall be held on the next business day thereafter. Special meetings
of the Board of Directors may be called upon at least two day's notice whenever
it may be deemed proper by the Chairman of the Board or, the Chief Executive
Officer or, in their absence, by such other director as the Board of Directors
may have designated pursuant to Section 3 of this Article, and shall be called
upon like notice whenever any three of the directors so request in writing.
SECTION 6. The compensation of directors as such or as members of committees
shall be fixed from time to time by resolution of the Board of Directors.
<PAGE>
ARTICLE III
COMMITTEES
SECTION 1. There shall be an Executive Committee of the Board consisting of not
less than five directors who shall be appointed annually by the Board of
Directors. The Chairman of the Board shall preside at meetings of the Executive
Committee. In his absence, the Chief Executive Officer or, in his absence, such
other member of the Committee as the Committee from time to time may designate
shall preside at such meetings.
The Executive Committee shall possess and exercise to the extent permitted by
law all of the powers of the Board of Directors, except when the latter is in
session, and shall keep minutes of its proceedings, which shall be presented to
the Board of Directors at its next subsequent meeting. All acts done and powers
and authority conferred by the Executive Committee from time to time shall be
and be deemed to be, and may be certified as being, the act and under the
authority of the Board of Directors.
A majority of the Committee shall constitute a quorum, but the Committee may act
only by the concurrent vote of not less than one-third of its members, at least
one of whom must be a director other than an officer. Any one or more directors,
even though not members of the Executive Committee, may attend any meeting of
the Committee, and the member or members of the Committee present, even though
less than a quorum, may designate any one or more of such directors as a
substitute or substitutes for any absent member or members of the Committee, and
each such substitute or substitutes shall be counted for quorum, voting, and all
other purposes as a member or members of the Committee.
SECTION 2. There shall be an Audit Committee appointed annually by resolution
adopted by a majority of the entire Board of Directors which shall consist of
such number of directors, who are not also officers of the Company, as may from
time to time be fixed by resolution adopted by the Board of Directors. The
Chairman shall be designated by the Board of Directors, who shall also from time
to time fix a quorum for meetings of the Committee. Such Committee shall
conduct the annual directors' examinations of the Company as required by the New
York State Banking Law; shall review the reports of all examinations made of the
Company by public authorities and report thereon to the Board of Directors; and
shall report to the Board of Directors such other matters as it deems advisable
with respect to the Company, its various departments and the conduct of its
operations.
In the performance of its duties, the Audit Committee may employ or retain, from
time to time, expert assistants, independent of the officers or personnel of the
Company, to make studies of the Company's assets and liabilities as the
Committee may request and to make an examination of the accounting and auditing
methods of the Company and its system of internal protective controls to the
extent considered necessary or advisable in order to determine that the
operations of the Company, including its fiduciary departments, are being
audited by the General Auditor in such a manner as to provide prudent and
adequate protection. The Committee also may direct the General Auditor to make
such investigation as it deems necessary or advisable with respect to the
Company, its various departments and the conduct of its operations. The
Committee shall hold regular quarterly meetings and during the intervals thereof
shall meet at other times on call of the Chairman.
<PAGE>
SECTION 3. The Board of Directors shall have the power to appoint any other
Committees as may seem necessary, and from time to time to suspend or continue
the powers and duties of such Committees. Each Committee appointed pursuant to
this Article shall serve at the pleasure of the Board of Directors.
ARTICLE IV
OFFICERS
SECTION 1. The Board of Directors shall elect from among their number a
Chairman of the Board and a Chief Executive Officer; and shall also elect a
President, and may also elect a Senior Vice Chairman, one or more Vice Chairmen,
one or more Executive Vice Presidents, one or more Senior Managing Directors,
one or more Managing Directors, one or more Senior Vice Presidents, one or more
Principals, one or more Vice Presidents, one or more General Managers, a
Secretary, a Controller, a Treasurer, a General Counsel, one or more Associate
General Counsels, a General Auditor, a General Credit Auditor, and one or more
Deputy Auditors, who need not be directors. The officers of the corporation may
also include such other officers or assistant officers as shall from time to
time be elected or appointed by the Board. The Chairman of the Board or the
Chief Executive Officer or, in their absence, the President, the Senior Vice
Chairman or any Vice Chairman, may from time to time appoint assistant officers.
All officers elected or appointed by the Board of Directors shall hold their
respective offices during the pleasure of the Board of Directors, and all
assistant officers shall hold office at the pleasure of the Board or the
Chairman of the Board or the Chief Executive Officer or, in their absence, the
President, the Senior Vice Chairman or any Vice Chairman. The Board of
Directors may require any and all officers and employees to give security for
the faithful performance of their duties.
SECTION 2. The Board of Directors shall designate the Chief Executive Officer
of the Company who may also hold the additional title of Chairman of the Board,
President, Senior Vice Chairman or Vice Chairman and such person shall have,
subject to the supervision and direction of the Board of Directors or the
Executive Committee, all of the powers vested in such Chief Executive Officer by
law or by these By-Laws, or which usually attach or pertain to such office. The
other officers shall have, subject to the supervision and direction of the Board
of Directors or the Executive Committee or the Chairman of the Board or, the
Chief Executive Officer, the powers vested by law or by these By-Laws in them as
holders of their respective offices and, in addition, shall perform such other
duties as shall be assigned to them by the Board of Directors or the Executive
Committee or the Chairman of the Board or the Chief Executive Officer.
The General Auditor shall be responsible, through the Audit Committee, to the
Board of Directors for the determination of the program of the internal audit
function and the evaluation of the adequacy of the system of internal controls.
Subject to the Board of Directors, the General Auditor shall have and may
exercise all the powers and shall perform all the duties usual to such office
and shall have such other powers as may be prescribed or assigned to him from
time to time by the Board of Directors or vested in him by law or by these By-
Laws. He shall perform such other duties and shall make such investigations,
examinations and reports as may be prescribed or required by the Audit
Committee. The General Auditor shall have unrestricted access to all records
and premises of the Company and shall delegate such authority to his
subordinates. He shall have the duty to report to the Audit Committee on all
matters concerning the internal audit
<PAGE>
program and the adequacy of the system of internal controls of the Company which
he deems advisable or which the Audit Committee may request. Additionally, the
General Auditor shall have the duty of reporting independently of all officers
of the Company to the Audit Committee at least quarterly on any matters
concerning the internal audit program and the adequacy of the system of internal
controls of the Company that should be brought to the attention of the directors
except those matters responsibility for which has been vested in the General
Credit Auditor. Should the General Auditor deem any matter to be of special
immediate importance, he shall report thereon forthwith to the Audit Committee.
The General Auditor shall report to the Chief Financial Officer only for
administrative purposes.
The General Credit Auditor shall be responsible to the Chief Executive Officer
and, through the Audit Committee, to the Board of Directors for the systems of
internal credit audit, shall perform such other duties as the Chief Executive
Officer may prescribe, and shall make such examinations and reports as may be
required by the Audit Committee. The General Credit Auditor shall have
unrestricted access to all records and may delegate such authority to
subordinates.
SECTION 3. The compensation of all officers shall be fixed under such plan or
plans of position evaluation and salary administration as shall be approved from
time to time by resolution of the Board of Directors.
SECTION 4. The Board of Directors, the Executive Committee, the Chairman of the
Board, the Chief Executive Officer or any person authorized for this purpose by
the Chief Executive Officer, shall appoint or engage all other employees and
agents and fix their compensation. The employment of all such employees and
agents shall continue during the pleasure of the Board of Directors or the
Executive Committee or the Chairman of the Board or the Chief Executive Officer
or any such authorized person; and the Board of Directors, the Executive
Committee, the Chairman of the Board, the Chief Executive Officer or any such
authorized person may discharge any such employees and agents at will.
<PAGE>
ARTICLE V
INDEMNIFICATION OF DIRECTORS, OFFICERS AND OTHERS
SECTION 1. The Company shall, to the fullest extent permitted by Section 7018
of the New York Banking Law, indemnify any person who is or was made, or
threatened to be made, a party to an action or proceeding, whether civil or
criminal, whether involving any actual or alleged breach of duty, neglect or
error, any accountability, or any actual or alleged misstatement, misleading
statement or other act or omission and whether brought or threatened in any
court or administrative or legislative body or agency, including an action by or
in the right of the Company to procure a judgment in its favor and an action by
or in the right of any other corporation of any type or kind, domestic or
foreign, or any partnership, joint venture, trust, employee benefit plan or
other enterprise, which any director or officer of the Company is servicing or
served in any capacity at the request of the Company by reason of the fact that
he, his testator or intestate, is or was a director or officer of the Company,
or is serving or served such other corporation, partnership, joint venture,
trust, employee benefit plan or other enterprise in any capacity, against
judgments, fines, amounts paid in settlement, and costs, charges and expenses,
including attorneys' fees, or any appeal therein; provided, however, that no
indemnification shall be provided to any such person if a judgment or other
final adjudication adverse to the director or officer establishes that (i) his
acts were committed in bad faith or were the result of active and deliberate
dishonesty and, in either case, were material to the cause of action so
adjudicated, or (ii) he personally gained in fact a financial profit or other
advantage to which he was not legally entitled.
SECTION 2. The Company may indemnify any other person to whom the Company is
permitted to provide indemnification or the advancement of expenses by
applicable law, whether pursuant to rights granted pursuant to, or provided by,
the New York Banking Law or other rights created by (i) a resolution of
stockholders, (ii) a resolution of directors, or (iii) an agreement providing
for such indemnification, it being expressly intended that these By-Laws
authorize the creation of other rights in any such manner.
SECTION 3. The Company shall, from time to time, reimburse or advance to any
person referred to in Section 1 the funds necessary for payment of expenses,
including attorneys' fees, incurred in connection with any action or proceeding
referred to in Section 1, upon receipt of a written undertaking by or on behalf
of such person to repay such amount(s) if a judgment or other final adjudication
adverse to the director or officer establishes that (i) his acts were committed
in bad faith or were the result of active and deliberate dishonesty and, in
either case, were material to the cause of action so adjudicated, or (ii) he
personally gained in fact a financial profit or other advantage to which he was
not legally entitled.
SECTION 4. Any director or officer of the Company serving (i) another
corporation, of which a majority of the shares entitled to vote in the election
of its directors is held by the Company, or (ii) any employee benefit plan of
the Company or any corporation referred to in clause (i) in any capacity shall
be deemed to be doing so at the request of the Company. In all other cases, the
provisions of this Article V will apply (i) only if the person serving another
corporation or any partnership, joint venture, trust, employee benefit plan or
other enterprise so served at the specific request of the Company, evidenced by
a written communication signed by the Chairman of the Board, the Chief Executive
Officer or the
<PAGE>
President, and (ii) only if and to the extent that, after making such efforts as
the Chairman of the Board, the Chief Executive Officer or the President shall
deem adequate in the circumstances, such person shall be unable to obtain
indemnification from such other enterprise or its insurer.
SECTION 5. Any person entitled to be indemnified or to the reimbursement or
advancement of expenses as a matter of right pursuant to this Article V may
elect to have the right to indemnification (or advancement of expenses)
interpreted on the basis of the applicable law in effect at the time of
occurrence of the event or events giving rise to the action or proceeding, to
the extent permitted by law, or on the basis of the applicable law in effect at
the time indemnification is sought.
SECTION 6. The right to be indemnified or to the reimbursement or advancement
of expense pursuant to this Article V (i) is a contract right pursuant to which
the person entitled thereto may bring suit as if the provisions hereof were set
forth in a separate written contract between the Company and the director or
officer, (ii) is intended to be retroactive and shall be available with respect
to events occurring prior to the adoption hereof, and (iii) shall continue to
exist after the rescission or restrictive modification hereof with respect to
events occurring prior thereto.
SECTION 7. If a request to be indemnified or for the reimbursement or
advancement of expenses pursuant hereto is not paid in full by the Company
within thirty days after a written claim has been received by the Company, the
claimant may at any time thereafter bring suit against the Company to recover
the unpaid amount of the claim and, if successful in whole or in part, the
claimant shall be entitled also to be paid the expenses of prosecuting such
claim. Neither the failure of the Company (including its Board of Directors,
independent legal counsel, or its stockholders) to have made a determination
prior to the commencement of such action that indemnification of or
reimbursement or advancement of expenses to the claimant is proper in the
circumstance, nor an actual determination by the Company (including its Board of
Directors, independent legal counsel, or its stockholders) that the claimant is
not entitled to indemnification or to the reimbursement or advancement of
expenses, shall be a defense to the action or create a presumption that the
claimant is not so entitled.
SECTION 8. A person who has been successful, on the merits or otherwise, in the
defense of a civil or criminal action or proceeding of the character described
in Section 1 shall be entitled to indemnification only as provided in Sections 1
and 3, notwithstanding any provision of the New York Banking Law to the
contrary.
<PAGE>
ARTICLE VI
SEAL
SECTION 1. The Board of Directors shall provide a seal for the Company, the
counterpart dies of which shall be in the charge of the Secretary of the Company
and such officers as the Chairman of the Board, the Chief Executive Officer or
the Secretary may from time to time direct in writing, to be affixed to
certificates of stock and other documents in accordance with the directions of
the Board of Directors or the Executive Committee.
SECTION 2. The Board of Directors may provide, in proper cases on a specified
occasion and for a specified transaction or transactions, for the use of a
printed or engraved facsimile seal of the Company.
ARTICLE VII
CAPITAL STOCK
SECTION 1. Registration of transfer of shares shall only be made upon the books
of the Company by the registered holder in person, or by power of attorney, duly
executed, witnessed and filed with the Secretary or other proper officer of the
Company, on the surrender of the certificate or certificates of such shares
properly assigned for transfer.
ARTICLE VIII
CONSTRUCTION
SECTION 1. The masculine gender, when appearing in these By-Laws, shall be
deemed to include the feminine gender.
ARTICLE IX
AMENDMENTS
SECTION 1. These By-Laws may be altered, amended or added to by the Board of
Directors at any meeting, or by the stockholders at any annual or special
meeting, provided notice thereof has been given.
<PAGE>
I, SusanJohnson, Assistant Vice President of Bankers Trust Company, New York,
------------
New York, hereby certify that the foregoing is a complete, true and correct copy
of the By-Laws of Bankers Trust Company, and that the same are in full force and
effect at this date.
Susan Johnson
--------------------------------------
ASSISTANT VICE PRESIDENT
DATED: May 14, 1998
<PAGE>
<TABLE>
<CAPTION>
Legal Title of Bank: Bankers Trust Company Call Date: 12/31/97 ST-BK: 36-4840 FFIEC 031
Address: 130 Liberty Street Vendor ID: D CERT: 00623 Page RC-1
City, State ZIP: New York, NY 10006 11
FDIC Certificate No.: | 0 | 0 | 6 | 2 | 3
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for December 31, 1997
All schedules are to be reported in thousands of dollars. Unless otherwise indicated,
reported the amount outstanding as of the last business day of the quarter.
<S> <C> <C> <C>
Schedule RC--Balance Sheet
_______________
| C400 |
Dollar Amounts in Thousands |RCFD Bil Mil Thou |
ASSETS | / / / / / / / / / / / / /
1. Cash and balances due from depository institutions (from Schedule RC-A): | / / / / / / / / / / / / /
a. Noninterest-bearing balances and currency and coin (1) ............................... | 0081 2,121,000 |1.a.
b. Interest-bearing balances (2) ...........................................................| 0071 4,770,000 |1.b.
2. Securities: | / / / / / / / / / |
a. Held-to-maturity securities (from Schedule RC-B, column A) ....................... | 1754 0|2.a.
b. Available-for-sale securities (from Schedule RC-B, column D)...................... | 1773 4,015,000|2.b.
3. Federal funds sold and securities purchased under agreements to resell................. | 1350 28,927,000|3.
4. Loans and lease financing receivables: | / / / / / / / / / |
a. Loans and leases, net of unearned income (from Schedule RC-C) RCFD 2122 17,692,000 | / / / / / / / / / /|4.a.
b. LESS: Allowance for loan and lease losses........................RCFD 3123 659,000 | / / / / / / / / / /|4.b.
c. LESS: Allocated transfer risk reserve ...........................RCFD 3128 0 | / / / / / / / / / /|4.c.
d. Loans and leases, net of unearned income, | / / / / / / / / / /
allowance, and reserve (item 4.a minus 4.b and 4.c) ......................................| 2125 17,033,000|4.d.
5. Trading Assets (from schedule RC-D) ...........................................................| 3545 45,488,000 |5.
6. Premises and fixed assets (including capitalized leases) .......................................| 2145 766,000 |6.
7. Other real estate owned (from Schedule RC-M) ...................................................| 2150 188,000 |7.
8. Investments in unconsolidated subsidiaries and associated companies (from Schedule RC-M) | 2130 58,000 |8.
9. Customers' liability to this bank on acceptances outstanding .................................. | 2155 633,000 |9.
10. Intangible assets (from Schedule RC-M) .........................................................| 2143 83,000 |10.
11. Other assets (from Schedule RC-F) ..............................................................| 2160 5,957,000 |11.
12. Total assets (sum of items 1 through 11) .......................................................| 2170 110,039,000|12.
</TABLE>
__________________________
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
<PAGE>
<TABLE>
<CAPTION>
Legal Title of Bank: Bankers Trust Company Call Date: 12/31/97 ST-BK: 36-4840 FFIEC 031
Address: 130 Liberty Street Vendor ID: D CERT: 00623 Page RC-2
City, State Zip: New York, NY 10006 12
FDIC Certificate No.: | 0 | 0 | 6 | 2 | 3
<S> <C> <C> <C>
Schedule RC--Continued ____________________________
Dollar Amounts in Thousands | / / / / Bil Mil Thou __
LIABILITIES | / / / / / / / / / / /
13. Deposits: | / / / / / / / / / / /
a. In domestic offices (sum of totals of columns A and C from Schedule RC-E, part I) | RCON 2200 24,608,000
(1) Noninterest-bearing(1) ............................RCON 6631 2,856,000........ | / / / / / / / / / /
(2) Interest-bearing .................................. RCON 6636 21,752,000....... | / / / / / / / / / /
b. In foreign offices, Edge and Agreement subsidiaries, and IBFs (from Schedule RC-E | / / / / / / / / / /
part II) | RCFN 2200 20,529,000
(1) Noninterest-bearing .................................RCFN 6631 2,122,000| / / / / / / / / / /
(2) Interest-bearing ....................................RCFN 6636 18,407,000|
14. Federal funds purchased and securities sold under agreements to repurchase | RCFD 2800 13,777,000
15. a. Demand notes issued to the U.S. Treasury .............................................| RCON 2840 0
b. Trading liabilities (from Schedule RC-D)..............................................| RCFD 3548 24,968,000
16. Other borrowed money (includes mortgage indebtedness and obligations under capitalized leases): / / / / / / / / / /
a. With a remaining maturity of one year or less ........................................| RCFD 2332 5,810,000
b. With a remaining maturity of more than one year through three years..................| A547 4,702,000
c. With a remaining maturity of more than three years....................................| A548 1,750,000
17. Not Applicable.
18. Bank's liability on acceptances executed and outstanding ....................................| RCFD 2920 633,000
19. Subordinated notes and debentures (2)........................................................| RCFD 3200 1,307,000
20. Other liabilities (from Schedule RC-G) ......................................................| RCFD 2930 5,961,000
21. Total liabilities (sum of items 13 through 20) ..............................................| RCFD 2948 104,045,000
22. Not Applicable | / / / / / / / / / /
| / / / / / / / / / /
EQUITY CAPITAL | / / / / / / / / / /
23. Perpetual preferred stock and related surplus ...............................................| RCFD 3838 1,000,000
24. Common stock ................................................................................| RCFD 3230 1,352,000
25. Surplus (exclude all surplus related to preferred stock) ....................................| RCFD 3839 540,000
26. a. Undivided profits and capital reserves .................................................| RCFD 3632 3,526,000
b. Net unrealized holding gains (losses) on available-for-sale securities .................| RCFD 8434 ( 45,000)
27. Cumulative foreign currency translation adjustments .........................................| RCFD 3284 ( 379,000) |27.
28. Total equity capital (sum of items 23 through 27) ...........................................| RCFD 3210 5,994,000 |28.
29. Total liabilities and equity capital (sum of items 21 and 28)................................| RCFD 3300 110,039,000
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the statement below that best describes the
most comprehensive level of auditing work performed for the bank by independent external Number
auditors as of any date during 1996 .....................................| CFD 6724 N/A | M
</TABLE>
1 = Independent audit of the bank conducted in accordance
with generally accepted auditing standards by a certified
public accounting firm which submits a report on the bank
2 = Independent audit of the bank's parent holding company
conducted in accordance with generally accepted auditing
standards by a certified public accounting firm which
submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in
accordance with generally accepted auditing standards
by a certified public accounting firm (may be required by
state chartering authority)
4 = Directors' examination of the bank performed by other
external auditors (may be required by state chartering
authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external
auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
______________________
(1) Including total demand deposits and noninterest-bearing time and savings
deposits.
(2) Includes limited-life preferred stock and related surplus.
