<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 23, 1998
REG. NO. 333-50225
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 1 TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
<TABLE>
<S> <C>
USBANCORP, INC. USBANCORP CAPITAL TRUST I
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) (EXACT NAME OF THE REGISTRANT AS SPECIFIED IN ITS TRUST
PENNSYLVANIA AGREEMENT)
(STATE OR OTHER JURISDICTION OF INCORPORATION OR DELAWARE
ORGANIZATION) (STATE OR OTHER JURISDICTION OF INCORPORATION
25-1424278 OR ORGANIZATION OF REGISTRANT)
(I.R.S. EMPLOYER IDENTIFICATION NO.) APPLIED FOR
MAIN AND FRANKLIN STREETS, JOHNSTOWN, PENNSYLVANIA 15907 (I.R.S. EMPLOYER IDENTIFICATION NO.)
(814) 533-5300 MAIN AND FRANKLIN STREETS, JOHNSTOWN, PENNSYLVANIA 15907
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, (814) 533-5300
INCLUDING AREA CODE, (ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES) INCLUDING AREA CODE,
OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
</TABLE>
------------------------
JEFFREY A. STOPKO
SENIOR VICE PRESIDENT AND CHIEF FINANCIAL OFFICER
USBANCORP, INC.
P.O. BOX 430
MAIN AND FRANKLIN STREETS,
JOHNSTOWN, PENNSYLVANIA 15907
(814) 533-5300-0430
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE OF EACH REGISTRANT)
WITH COPIES TO:
<TABLE>
<S> <C>
JEFFREY P. WALDRON LEE MEYERSON
STEVENS & LEE SIMPSON THACHER & BARTLETT
ONE GLENHARDIE CORPORATE CENTER SUITE 202 425 LEXINGTON AVENUE, NEW YORK, NEW YORK 10017
1275 DRUMMERS LANE, WAYNE, PENNSYLVANIA 19087 (212) 455-2000
(610) 293-4961
</TABLE>
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
As soon as practicable after the Registration Statement becomes effective.
------------------------
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, check the following box. [ ]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, 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 number of the earlier effective registration statement for the same
offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
================================================================================
<TABLE>
<CAPTION>
PROPOSED PROPOSED
TITLE OF EACH CLASS OF AMOUNT TO BE MAXIMUM OFFERING MAXIMUM AGGREGATE AMOUNT OF
SECURITIES TO BE REGISTERED REGISTERED PRICE PER UNIT(1) OFFERING PRICE(1) REGISTRATION FEE
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------------------------
Junior Subordinated Deferrable Interest
Debentures of USBANCORP, Inc.(2).............. 1,380,000 $25.00 $34,500,000 $10,178
- ---------------------------------------------------------------------------------------------------------------------------------
Preferred Securities of USBANCORP Capital Trust
I............................................. 1,380,000 $25.00 $34,500,000 NA
- ---------------------------------------------------------------------------------------------------------------------------------
The USBANCORP, Inc. Guarantee with respect to
Preferred Securities(3)(4).................... NA NA NA NA
- ---------------------------------------------------------------------------------------------------------------------------------
Total........................................... 1,380,000 100% $34,500,000(5) $10,178
=================================================================================================================================
</TABLE>
(1) Estimated solely for the purpose of computing the registration fee.
(2) The Junior Subordinated Deferrable Interest Debentures will be purchased by
USBANCORP Capital Trust I with the proceeds of the sale of the Preferred
Securities.
(3) No separate consideration will be received for the USBANCORP Guarantee.
(4) This Registration Statement is deemed to cover the Junior Subordinated
Deferrable Interest Debentures of USBANCORP, the rights of holders of Junior
Subordinated Deferrable Interest Debentures of USBANCORP, Inc. under the
Indenture, the rights of holders of Preferred Securities of USBANCORP
Capital Trust I under the Trust Agreement, the rights of holders of the
Preferred Securities under the Guarantee, which, taken together, fully,
irrevocably and unconditionally guarantee all of the respective obligations
of USBANCORP Capital Trust I under the Preferred 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 USBANCORP
Capital Trust I Preferred 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 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
================================================================================
<PAGE> 2
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION DATED APRIL 23, 1998
$30,000,000
USBANCORP CAPITAL TRUST I
BLUS(SM)
% BENEFICIAL UNSECURED SECURITIES, SERIES A
(LIQUIDATION AMOUNT $25 PER CAPITAL SECURITY)
FULLY AND UNCONDITIONALLY GUARANTEED, AS DESCRIBED HEREIN, BY
[USBANCORP LOGO]
The % Beneficial Unsecured Securities, Series A (the "Series A Capital
Securities"), offered hereby represent beneficial ownership interests in
USBANCORP Capital Trust I, a statutory business trust created under the laws of
the State of Delaware (the "Issuer"). USBANCORP, Inc., a Pennsylvania
corporation (the "Corporation"), will be the owner of all the beneficial
ownership interests represented by common securities of the Issuer (the "Series
A Common Securities" or "Common Securities" and, collectively with the Series A
Capital Securities, the "Series A Securities"). The Bank of New York is the
Property Trustee of the Issuer. The Issuer exists for the sole purpose of
issuing the Series A Capital Securities and the Series A Common Securities and
investing the proceeds thereof in approximately $30,927,850 of % Junior
Subordinated Deferrable Interest Debentures, Series A (the "Series A
Subordinated Debentures"), to be issued by the Corporation. The Series A
Subordinated Debentures will mature on June 30, 2028. The Series A Capital
Securities will have a preference under certain circumstances with respect to
cash distributions and amounts payable on liquidation or redemption over the
Series A Common Securities. See "Description of Series A Capital Securities --
Subordination of Common Securities."
Holders of the Series A Capital Securities will be entitled to receive
cumulative cash distributions accruing from the date of original issuance and
payable quarterly in arrears on the last day of March, June, September and
December of each year, commencing June 30, 1998, at the annual rate of % on
the Liquidation Amount (as defined herein) of $25 per Series A Capital Security
("Distributions"). Subject to certain exceptions, as described herein, the
Corporation has the right to defer payment of interest on the Series A
Subordinated Debentures at any time or from time to time for a period not
exceeding 20 consecutive quarterly periods with respect to each deferral period
(each, an "Extension Period"), provided that no Extension Period may extend
beyond the Stated Maturity of the Series A 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 quarterly, 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
Continued on next page
------------------
SEE "RISK FACTORS" BEGINNING ON PAGE 9 HEREOF FOR CERTAIN INFORMATION
RELEVANT TO AN INVESTMENT IN THE SERIES A CAPITAL SECURITIES.
------------------
THESE SECURITIES ARE NOT DEPOSITS OR OTHER OBLIGATIONS OF A BANK AND ARE NOT
INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL
AGENCY.
------------------
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 TO WHICH IT RELATES. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
------------------
<TABLE>
<S> <C> <C> <C>
=================================================================================================================================
INITIAL PUBLIC UNDERWRITING PROCEEDS TO THE
OFFERING PRICE(1) COMMISSIONS(2) ISSUER(1)(3)(4)
- ---------------------------------------------------------------------------------------------------------------------------------
Per Series A Capital Security............ $25.00 (3) $25.00
Total.................................... $30,000,000 (3) $30,000,000
=================================================================================================================================
</TABLE>
(1) Plus accrued Distributions, if any, from , 1998 to the date of
delivery.
(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 Series A Capital
Securities will be invested in the Series A Subordinated Debentures, the
Corporation has agreed to pay to the Underwriters as compensation for their
arranging the investment therein of such proceeds $ per Series A Capital
Security (or $ in the aggregate). See "Underwriting."
(4) Expenses of the offering, which are payable by the Corporation, are
estimated to be $250,000.
(5) The Issuer has granted the Underwriters a 30-day option to purchase up to
180,000 additional Series A Capital Securities on the same terms and
conditions set forth above to cover over-allotment options, if any. If this
option is exercised in full, the Total Price to the Public will be
$34,500,000 and Proceeds to the Issuer will be $34,500,000. See
"Underwriting."
------------------
The Series A 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 Series A 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 April , 1998, against payment therefor in immediately
available funds.
------------------
CIBC OPPENHEIMER LEGG MASON WOOD WALKER
INCORPORATED
The date of this Prospectus is April , 1998
<PAGE> 3
CERTAIN PERSONS PARTICIPATING IN THE OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE SERIES A CAPITAL
SECURITIES, INCLUDING SYNDICATE COVERING TRANSACTIONS AND THE IMPOSITION OF A
PENALTY BID. FOR A DESCRIPTION OF THESE ACTIVITIES, SEE "UNDERWRITING."
- ------------------------
(cover page continued)
payments on the Series A Subordinated Debentures are so deferred, distributions
on the Series A 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 Series A
Subordinated Debentures. During an Extension Period, interest on the Series A
Subordinated Debentures will continue to accrue (and the amount of Distributions
to which holders of the Series A Capital Securities are entitled will
accumulate) at the rate of % per annum, compounded quarterly from the
relevant payment date for such interest, and holders of Series A Capital
Securities will be required to accrue interest income for United States federal
income tax purposes. See "Description of Series A Subordinated
Debentures -- Option to Defer Interest Payments" and "Certain Federal Income Tax
Consequences -- Interest Income and Original Issue Discount."
The Series A Subordinated Debentures are unsecured and subordinated to all
Senior Debt (as defined herein). 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, United States National Bank in Johnstown
("U.S. Bank") and Three Rivers Bank and Trust Company ("Three Rivers Bank"),
upon such subsidiary's liquidation or reorganization or otherwise, 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 Series A Subordinated Debentures (and therefore the Series A
Capital Securities) will be effectively subordinated to all existing and future
liabilities of the Corporation's subsidiaries, and holders thereof should only
look to the assets of the Corporation for payments on the Series A Subordinated
Debentures. See "Description of Junior Subordinated Debentures --
Subordination".
The Corporation has, through the Series A Guarantee, the Series A Trust
Agreement, the Series A Subordinated Debentures and the Indenture (each as
defined herein), taken together, fully, irrevocably and unconditionally
guaranteed all of the Issuer's obligations under the Series A Capital
Securities. See "Relationship Among the Series A Securities, the Series A
Subordinated Debentures and the Series A Guarantees -- Full and Unconditional
Guarantee." The Series A Guarantee of the Corporation (the "Series A Guarantee")
guarantees the payment of Distributions and payments on liquidation of the
Issuer or redemption of the Series A Capital Securities, but only in each case
to the extent of funds held by the Issuer, as described herein. See "Description
of Series A Guarantee." If the Corporation does not make interest payments on
the Series A Subordinated Debentures held by the Issuer, the Issuer will have
insufficient funds to pay Distributions on the Series A Capital Securities. The
Series A Guarantee does not cover payment of Distributions when the Issuer has
insufficient funds to pay such Distributions. In such event, a holder of Series
A 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 Series A
Capital Securities." The obligations of the Corporation under the Series A
Guarantee are subordinate and junior in right of payment to all Senior Debt of
the Corporation.
The Series A Capital Securities are subject to mandatory redemption, in
whole or in part, upon repayment of the Series A Subordinated Debentures at
their Stated Maturity or earlier redemption. Subject to the Corporation having
received prior approval of the Board of Governors of the Federal Reserve System
(the "Federal Reserve") to do so if then required under applicable capital
guidelines or policies, the Series A Subordinated Debentures are redeemable
prior to their Stated Maturity at the option of the Corporation (i) on or after
June 30, 2003, in whole at any time or in part from time to time, or (ii) at any
time in certain circumstances as described under "Description of Series A
Subordinated Debentures -- Conditional Right to
2
<PAGE> 4
Redeem upon a Tax Event or Capital Treatment Event," in whole (but not in part),
within 90 days following the occurrence of a Tax Event or Capital Treatment
Event. See "Description of Series A Capital Securities -- Redemption" and
"Description of Series A Subordinated Debentures -- Redemption."
The Corporation will have the right at any time to terminate the Issuer,
subject to the Corporation having received prior approval of the Federal Reserve
to do so if then required under applicable capital guidelines or policies. See
"Description of Series A Capital Securities -- Liquidation of Issuer and
Distribution of Series A Subordinated Debentures to Holders." 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 Series A Capital
Securities will be entitled to receive $25 per Series A Capital Security (the
"Liquidation Amount") plus accumulated and unpaid Distributions thereon to the
date of payment, which may be in the form of a distribution of such amount in
Series A Subordinated Debentures in exchange therefor, subject to certain
exceptions. See "Description of Series A Capital Securities -- Liquidation
Distribution Upon Termination".
The Series A Capital Securities will be represented by one or more global
certificates registered in the name of The Depository Trust Company ("DTC") or
its nominee. Beneficial interests in the Series A Capital Securities will be
shown on, and transfers thereof will be effected only through, records
maintained by DTC and its participants ("Participants"). Except as described
herein, Series A Capital Securities in certificated form will not be issued in
exchange for the global certificates. See "Description of Series A Capital
Securities -- Registration of Series A Capital Securities."
3
<PAGE> 5
------------------
As used herein, (i) the "Indenture" means the Junior Subordinated
Indenture, dated as of April 1, 1998, as amended and supplemented from time to
time, between the Corporation and The Bank of New York, as trustee (the
"Debenture Trustee"), and (ii) the "Series A Trust Agreement" means the Trust
Agreement as amended and restated by the Amended and Restated Trust Agreement
relating to the Issuer among the Corporation, as Depositor, The Bank of New
York, as Property Trustee (the "Property Trustee"), The Bank of New York
(Delaware), as Delaware Trustee (the "Delaware Trustee"), the Administrative
Trustees named therein (collectively, with the Property Trustee and Delaware
Trustee, the "Issuer Trustees") and the holders of the Series A Capital
Securities and the Series A Common Securities.
AVAILABLE INFORMATION
The Corporation is subject to the information 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.,
Judiciary Plaza, 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., Judiciary Plaza, Washington, D.C. 02549. 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 National Association of Securities Dealers, Inc., 1735 K Street N.W.,
Washington, D.C. 20006.
The Corporation and the Issuer 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 the Issuer have been included herein.
The Corporation and the Issuer do not consider that such financial statements
would be material to holders of the Series A Capital Securities because the
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 Series A Subordinated
Debentures of the Corporation and issuing the Series A Capital Securities. See
"The Issuer," "Description of Series A Capital Securities," "Description of
Series A Subordinated Debentures" and "Description of Series A Guarantee." In
addition, the Corporation does not expect that the Issuer 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. Annual Report on Form 10-K for the year ended December 31, 1997.
4
<PAGE> 6
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: USBANCORP, Inc.,
P.O. Box 430, Main and Franklin Streets, Johnstown, Pennsylvania 15907-0430,
Attention: Chief Financial Officer, telephone number (814) 533-5310.
5
<PAGE> 7
SUMMARY
The following summary is qualified in its entirety by the more detailed
information appearing elsewhere in this Prospectus.
USBANCORP, INC.
The Corporation is a Pennsylvania corporation and bank holding company
headquartered in Johnstown, Pennsylvania and is the holding company for United
States National Bank in Johnstown ("U.S. Bank") and Three Rivers Bank & Trust
Company ("Three Rivers Bank"). At December 31, 1997, the Corporation had total
consolidated assets, deposits and shareholders' equity of $2.24 billion, $1.14
billion and $158 million, respectively.
U.S. Bank is a national banking association organized under the laws of the
United States. Through 20 locations in Cambria, Clearfield, Somerset, and
Westmoreland Counties, Pennsylvania, U.S. Bank conducts a general banking
business. Three Rivers Bank is a state bank organized under Pennsylvania law.
Through 23 locations in Allegheny and Washington Counties, Pennsylvania, Three
Rivers Bank conducts a general banking business.
RECENT DEVELOPMENTS
The Corporation's net income for the quarter ended March 31, 1998 was
$5,695,000 or $1.15 on a diluted per share basis compared to net income of
$5,668,000 or $1.10 per diluted share for the quarter ended March 31, 1997.
Earnings per share grew at a faster rate than net income due to the
Corporation's on-going treasury stock repurchase program. The Corporation's
return on equity averaged 14.6% in the first quarter of 1998 compared to a
return on equity of 14.9% in the first quarter of 1997. The Corporation's return
on assets was 1.03% in the first quarter of 1998. At March 31, 1998, the
Corporation had consolidated assets, net loans, deposits and shareholders'
equity of $2.21 billion, $1.02 billion, $1.17 billion and $155.8 million,
respectively. At December 31, 1997, the Corporation had consolidated assets, net
loans, deposits and shareholders' equity of $2.24 billion, $989.6 million, $1.14
billion and $158.2 million, respectively.
USBANCORP CAPITAL TRUST I
The Issuer is a statutory business trust formed under Delaware law pursuant
to (i) the Series A Trust Agreement executed by the Corporation, as Sponsor, The
Bank of New York, as Property Trustee, The Bank of New York (Delaware), as
Delaware Trustee and the three individual Administrative Trustees named therein,
and (ii) the filing of a certificate of trust with the Delaware Secretary of
State on April 15, 1998. The Issuer's business and affairs are conducted by the
Issuer Trustees: the Property Trustee, the Delaware Trustee, and the three
individual Administrative Trustees who are employees or officers of or
affiliated with the Corporation. The Issuer exists for the exclusive purposes of
(i) issuing and selling the Series A Capital Securities and the Series A Common
Securities, (ii) using the proceeds from the sale of the Series A Capital
Securities and the Series A Common Securities to acquire the Series A
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 Series A Capital Securities and the Series A Common Securities).
Accordingly, the Series A Subordinated Debentures will be the sole assets of the
Issuer, and payments under the Series A Subordinated Debentures will be the sole
revenue of the Issuer. All of the Series A Common Securities will be owned by
the Corporation.
6
<PAGE> 8
THE OFFERING
Securities Offered......... 1,200,000 Series A Capital Securities
Offering Price............. $25.00 per Capital Security plus accumulated
Distributions, if any, from , 1998.
Distributions.............. The Distributions payable on each Series A Capital
Security will be fixed at a rate per annum of %
of the Liquidation Amount of $25 per Series A
Capital Security, will be cumulative, will accrue
from the date of issuance of the Series A Capital
Securities, and will be payable quarterly in
arrears on the last day of March, June, September
and December of each year, commencing on June 30,
1998 (subject to possible deferral as described
below) and on the Stated Maturity Date. The amount
of each Distribution due with respect to the Series
A Capital Securities will include amounts accrued
through the date the Distribution payment is due.
See "Description of Series A Capital
Securities -- Distributions."
Extension Periods.......... Distributions on Series A Capital Securities will
be deferred for the duration of any Extension
Period elected by the Corporation with respect to
the payment of interest on the Series A
Subordinated Debentures. No Extension Period will
exceed 20 consecutive quarterly periods, end on a
date other than an Interest Payment Date or extend
beyond the Stated Maturity Date. See "Description
of Series A Subordinated Debentures -- Option to
Extend Interest Payment Date" and "Certain Federal
Income Tax Consequences -- Interest Income and
Original Issue Discount."
Ranking.................... The Series A Capital Securities will rank pari
passu, and payments thereon will be made pro rata,
with the Common Securities except as described
under "Description of Series A Capital
Securities -- Subordination of Common Securities."
The Series A Subordinated Debentures will rank pari
passu with all other junior subordinated debentures
to be issued by the Corporation with substantially
similar subordination terms and which have been or
may be issued and sold to any other trust, or a
trustee of such trust, partnership or other entity
affiliated with the Corporation that is a financing
vehicle of the Corporation (a "financing entity")
established or to be established by the Corporation
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 herein) of the Corporation. See
"Description of Series A Subordinated Debentures."
The Series A Guarantee will rank pari passu with
all other guarantees issued or to be issued by the
Corporation with respect to capital securities
issued or to be issued by a financing entity and
will constitute an unsecured obligation of the
Corporation and will rank subordinate and junior in
right of payment to the extent and in the manner
set forth in the Guarantee Agreement to all Senior
Debt of the Corporation. See "Description of Series
A Guarantee." In addition, because the Corporation
is a holding company, the Series A Subordinated
Debentures and the Series A Guarantee will be
effectively subordinated to all existing and future
liabilities of the Corporation's subsidiaries,
including the deposit liabilities of U.S. Bank and
Three Rivers Bank. See "Description of Series A
Subordinated Debentures -- Subordination."
7
<PAGE> 9
Redemption................. The Series A Capital Securities will be subject to
mandatory redemption, (i) in whole but not in part,
on the Stated Maturity Date upon repayment of the
Series A Subordinated Debentures, (ii) in whole but
not in part, at any time prior to June 30, 2003,
contemporaneously with the optional prepayment of
the Series A Subordinated Debentures by the
Corporation upon the occurrence and continuation of
a Tax Event or Capital Treatment Event and (iii) in
whole or in part, on or after June 30, 2003,
contemporaneously with the optional prepayment by
the Corporation of the Series A Subordinated
Debentures. See "Description of Series A Capital
Securities -- Redemption."
Absence of Market for the
Series A Capital
Securities............... The Series A Capital Securities will be a new issue
of securities for which there currently is no
market. The Issuer and the Corporation intend to
apply for quotation of the Series A Capital
Securities on the Nasdaq National Market. The
Series A Capital Securities will trade under the
symbol "UBANP." See "Underwriting." Although the
underwriters have informed the Issuer and the
Corporation that they each currently intend to make
a market in the Series A Capital Securities, the
underwriters are not obligated to do so, and any
such market making may be discontinued at any time
without notice. Accordingly, there can be no
assurance as to the development or liquidity of any
market for the Series A Capital Securities.
Use of Proceeds............ The proceeds to the Issuer from the sale of the
Series A Capital Securities will be invested by the
Issuer in the Series A Subordinated Debentures. The
Corporation intends to use the net proceeds from
the sale of the Series A Subordinated Debentures
for general corporate purposes, including the
repayment of debt, the repurchase of Corporation
common stock and investments in and advances to
Corporation subsidiaries. See "Use of Proceeds."
ERISA Considerations....... For a discussion of certain restrictions on
purchases, see "ERISA Considerations."
Risk Factors............... For a discussion of considerations relevant to an
investment in the Series A Capital Securities, see
"Risk Factors."
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RISK FACTORS
Prospective purchasers of the Series A Capital Securities should carefully
review the information contained elsewhere in this Prospectus and should
particularly consider the following matters. In addition, because holders of
Series A Capital Securities may receive Series A Subordinated Debentures in
exchange therefor upon liquidation of the Issuer, prospective purchasers of
Series A Capital Securities are also making an investment decision with regard
to the Series A Subordinated Debentures and should carefully review all the
information regarding the Series A Subordinated Debentures contained herein.
RANKING OF SUBORDINATED OBLIGATIONS UNDER THE SERIES A GUARANTEE AND THE SERIES
A SUBORDINATED DEBENTURES
The obligations of the Corporation under the Series A Guarantee issued by
the Corporation for the benefit of the holders of Series A Capital Securities
and under the Series A 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 the assets of any
subsidiary, including the U.S. Bank and Three Rivers Bank, upon such
subsidiary's liquidation or reorganization or otherwise, 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. There are
various legal limitations on the extent to which certain of the Corporation's
subsidiaries may extend credit, pay dividends or otherwise supply funds to, or
engage in transactions with, the Corporation or certain of its other
subsidiaries. Accordingly, the Series A Subordinated Debentures and the Series A
Guarantee will be effectively subordinated to all existing and future
liabilities of the Corporation's subsidiaries, and holders of Series A
Subordinated Debentures and beneficiaries of the Series A Guarantee should look
only to the assets of the Corporation for payments on the Series A Subordinated
Debentures or under the Series A Guarantee, as the case may be. See "USBANCORP,
Inc." None of the Indenture, the Series A Guarantee or the Series A Trust
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 Series A Guarantee -- Status of the Guarantee" and "Description of Series A
Subordinated Debentures -- Subordination."
The ability of the Issuer to pay amounts due on the Series A Capital
Securities is solely dependent upon the Corporation's making payments on the
Series A Subordinated Debentures as and when required.
OPTION TO DEFER INTEREST PAYMENT; TAX CONSEQUENCES; MARKET PRICE CONSEQUENCES
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 Series A Subordinated Debentures at any time or from time to
time for a period not exceeding 20 consecutive quarterly periods with respect to
each Extension Period, provided that no Extension Period may extend beyond the
Stated Maturity of the Series A Subordinated Debentures. As a consequence of any
such deferral, quarterly Distributions on the Series A Capital Securities by the
Issuer will also be deferred (and the amount of Distributions to which holders
of the Series A Capital Securities are entitled will accumulate additional
Distributions thereon at the rate of % per annum, compounded quarterly from
the relevant payment date for such Distributions) during any such Extension
Period. During any such Extension Period, the Corporation may not, and may not
permit any subsidiary of the Corporation to, (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire, or make a liquidation payment
with respect to, any of the Corporation's capital stock, (ii) make any payment
of principal, interest or premium, if any, on or repay, repurchase or redeem any
debt securities of the Corporation (including other series of Junior
Subordinated Debentures) that rank pari passu with or junior in interest to the
Series A Subordinated Debentures or (iii) make any guarantee payments with
respect to any guarantee by the Corporation of the debt securities of any
subsidiary of the Corporation if such guarantee ranks pari passu with or junior
in interest to the Series A Subordinated Debentures (other than (a) dividends or
distributions in capital stock of the Corporation, (b) any declaration of a
dividend in connection with the implementation of a shareholders' rights plan or
the redemption or repurchase of any such rights pursuant thereto, (c) payments
under the Series A Guarantee and (d) purchases of common stock related to the
issuance of common stock or
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rights under any of the Corporation's benefit plans for its directors, officers
or employees, related to the issuance of common stock or rights under a dividend
reinvestment and stock purchase plan, or related to the issuance of common stock
(or securities convertible into or exchangeable for common stock) as
consideration in an acquisition transaction that was entered into prior to the
commencement of such Extension Period). 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 20 consecutive quarterly periods or
extend beyond the Stated Maturity of the Series A 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 rate of % per
annum, compounded quarterly from the interest payment date 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 "Description of Series A Capital Securities -- Distributions" and
"Description of Series A Subordinated Debentures -- Option to Defer Interest
Payments."
Should an Extension Period occur, a holder of Series A Capital Securities
will be required to accrue income (in the form of original issue discount) in
respect of its pro rata share of the Series A Subordinated Debentures held by
the Issuer for United States federal income tax purposes. As a result, a holder
of Series A 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 Series A Capital
Securities prior to the record date for the payment of Distributions. See
"Certain Federal Income Tax Consequences -- Interest Income and Original Issue
Discount" and "-- Sales or Redemption of Series A Capital Securities."
The Corporation has no current intention of exercising its right to defer
payments of interest on the Series A Subordinated Debentures. However, should
the Corporation elect to exercise such right in the future, the market price of
the Series A Capital Securities is likely to be affected. A holder that disposes
of its Series A Capital Securities during an Extension Period, therefore, might
not receive the same return on its investment as a holder that continues to hold
its Series A Capital Securities.
REDEMPTION UPON TAX EVENT OR CAPITAL TREATMENT EVENT
Upon the occurrence and continuation of a Tax Event or Capital Treatment
Event (whether occurring before or after June 30, 2003), the Corporation has the
right if certain conditions are met, to redeem the Series A Subordinated
Debentures in whole (but not in part) within 90 days following the occurrence of
such Tax Event or Capital Treatment Event and thereby cause a mandatory
redemption of the Series A Capital Securities. The exercise of such right is
subject to the Corporation's having received prior approval of the Federal
Reserve to do so if then required under applicable capital guidelines or
policies. See "Description of Series A Subordinated Debentures -- Conditional
Right to Redeem upon a Tax Event or Capital Treatment Event" and "Description of
Series A Capital Securities -- Redemption or Exchange."
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 any amendment to,
or change (including any announced proposed change) in, the laws (or any
regulations thereunder) of the United States or any political subdivision or
taxing authority thereof or therein, or as a result of any official
administrative pronouncement or judicial decision interpreting or applying such
laws or regulations, which amendment or change is effective or which proposed
change, pronouncement or decision is announced on or after the date of issuance
of the Series A Capital Securities under the Series A Trust Agreement, 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 Series A Subordinated
Debentures, (ii) interest payable by the Corporation on the Series A
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 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. With respect to Series A
Subordinated Debentures which are no longer held by the Issuer or another
issuer, "Tax Event" means the receipt by the Corporation of an opinion of
counsel experienced in such matters to the effect that, as a result of any
amendment to, or change (including
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<PAGE> 12
any announced proposed change) in, the laws (or any regulations thereunder) of
the United States or any political subdivision or taxing authority thereof or
therein, or as a result of any official administrative pronouncement or judicial
decision interpreting or applying such laws or regulations, which amendment or
change is effective or which proposed change, pronouncement or decision is
announced on or after the date of issuance of the Series A Subordinated
Debentures under the Indenture, there is more than an insubstantial risk that
interest payable by the Corporation on the Series A 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 (each of the circumstances referred to in clauses (i), (ii) and (iii)
of the preceding sentence and the circumstances referred to in this sentence
being referred to herein as an "Adverse Tax Consequence").
A "Capital Treatment Event" means the reasonable determination by the
Corporation that, as a result of any amendment to, or change (including any
proposed change) in, the laws (or any regulations thereunder) of the United
States or any political subdivision thereof or therein, or as a result of any
official or administrative pronouncement or action or judicial decision
interpreting or applying such laws or regulations, which amendment or change is
effective or which proposed change, pronouncement, action or decision is
announced on or after the date of issuance of the Series A Capital Securities
under the Series A Trust Agreement, there is more than an insubstantial risk
that the Corporation will not be entitled to treat an amount equal to the
Liquidation Amount of the Series A Capital Securities as "Tier 1 Capital" (or
the then equivalent thereof) for purposes of the capital adequacy guidelines of
the Federal Reserve, as then in effect and applicable to the Corporation.
EXCHANGE OF SERIES A CAPITAL SECURITIES FOR SERIES A SUBORDINATED DEBENTURES
The Corporation will 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 Series A Subordinated Debentures to be distributed to
the holders of the Series A Capital Securities in exchange therefor upon
liquidation of the Issuer. The exercise of such right is subject to the
Corporation having received prior approval of the Federal Reserve if then
required under applicable capital guidelines or policies. See "Description of
Series A Capital Securities -- Liquidation of Issuer and Distribution of Series
A Subordinated Debentures to Holders" and "Description of Series A
Securities -- Redemption or Exchange."
Under current United States federal income tax law and interpretations and
assuming, as expected, the Issuer is classified as a grantor trust for such
purposes, a distribution of the Series A Subordinated Debentures upon a
liquidation of the Issuer should not be a taxable event to holders of the Series
A Capital Securities. However, if a Tax Event 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 Series A Subordinated Debentures, a
distribution of the Series A Subordinated Debentures by the Issuer could be a
taxable event to the Issuer and the holders of the Series A Capital Securities.
See "Certain Federal Income Tax Consequences -- Distribution of Series A
Subordinated Debentures to Holders of Series A Capital Securities."
MARKET PRICES
There can be no assurance as to the market prices for Series A Capital
Securities or Series A Subordinated Debentures that may be distributed in
exchange for Series A Capital Securities upon liquidation of the Issuer.
Accordingly, the Series A Capital Securities that an investor may purchase,
whether pursuant to the offer made hereby or in the secondary market, or the
Series A Subordinated Debentures that a holder of Series A Capital Securities
may receive on liquidation of the Issuer, may trade at a discount to the price
that the investor paid to purchase the Series A Capital Securities offered
hereby. As a result of the existence of the Corporation's right to defer
interest payments, the market price of the Series A Capital Securities (which
represent beneficial ownership interests in the Issuer) may be more volatile
than the market prices of other securities that are not subject to such optional
deferrals. See "Description of Series A Subordinated Debentures" and
"Description of Series A Subordinated Debentures."
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RIGHTS UNDER THE SERIES A GUARANTEE
The Series A Guarantee guarantees to the holders of the Series A 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 Series A 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 Series A 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 Series A
Subordinated Debentures are distributed to holders of the Series A 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
Series A Capital Securities after payment of creditors of the Issuer as required
by applicable law. The Series A Guarantee will be qualified as an indenture
under the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act").
The Bank of New York will act as the indenture trustee under the Series A
Guarantee (the "Guarantee Trustee") for the purpose of compliance with the Trust
Indenture Act and will hold the Series A Guarantee for the benefit of the
holders of the Series A Capital Securities. The Bank of New York will also act
as Debenture Trustee for the Series A Subordinated Debentures and as Property
Trustee under the Indenture and The Bank of New York (Delaware) will act as
Delaware Trustee under the Series A Trust Agreement.
The Series A Guarantee is subordinate as described under "-- Ranking of
Subordinated Obligations Under the Series A Guarantee and the Series A
Subordinated Debentures."
The holders of not less than a majority in aggregate Liquidation Amount of
the Series A 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 Series A Guarantee or to direct the exercise of any
trust power conferred upon the Guarantee Trustee under the Series A Guarantee.
Any holder of the Series A Capital Securities may institute a legal proceeding
directly against the Corporation to enforce its rights under the Series A
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 Series A Subordinated
Debentures, the Issuer would lack funds for the payment of Distributions or
amounts payable on redemption of the Series A Capital Securities or otherwise,
and, in such event, holders of the Series A Capital Securities would not be able
to rely upon the Series A Guarantee for payment of such amounts. Instead, if an
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 on
or principal of the Series A Subordinated Debentures on the applicable payment
date, then a holder of Series A Capital Securities may institute a legal
proceeding directly against the Corporation pursuant to the terms of the
Indenture for enforcement of payment to such holder of the principal of or
interest on such Series A Subordinated Debentures having a principal amount
equal to the aggregate Liquidation Amount of the Series A 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 Series A Capital
Securities in the Direct Action. Except as described herein, holders of Series A
Capital Securities will not be able to exercise directly any other remedy
available to the holders of the Series A Subordinated Debentures or assert
directly any other rights in respect of the Series A Subordinated Debentures.
See "Description of Series A Subordinated Debentures -- Enforcement of Certain
Rights by Holders of Preferred Securities," "-- Debenture Events of Default" and
"Description of Series A Guarantee." The Series A Trust Agreement provides that
each holder of Series A Capital Securities by acceptance thereof agrees to the
provisions of the Series A Guarantee and the Indenture.
LIMITED VOTING RIGHTS
Holders of Series A Capital Securities generally will have limited voting
rights relating only to the modification of the Series A Capital Securities and
the Series A Guarantee and the exercise of the Issuer's rights as holder of
Series A Subordinated Debentures. Holders of Series A Capital Securities will
not be entitled to vote to appoint, remove or replace the Property Trustee, the
Delaware Trustee or any Administrative Trustee, and such voting rights are
vested exclusively in the holder of the Series A Common Securities
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except, with respect to the Property Trustee and the Delaware Trustee, upon the
occurrence of certain events described herein. The Property Trustee, the
Administrative Trustees and the Corporation may amend the Series A Trust
Agreement without the consent of holders of Series A Capital Securities to
ensure that the Issuer will not be classified for United States federal income
tax purposes as an association or publicly traded partnership subject to
taxation as a corporation unless such action materially and adversely affects
the interests of such holders. See "Description of Series A Capital
Securities -- Removal of Issuer Trustees" and "--Voting Rights; Amendment of
Series A Trust Agreement."
TRADING CHARACTERISTICS
The Issuer and the Corporation intend to apply for quotation of the Series
A Capital Securities on the Nasdaq National Market. Although the Underwriters
have indicated to the Corporation and the Issuer that they intend to make a
market in the Series A Capital Securities, they are not obligated to do so and
may discontinue any such market-making activities at any time without notice. No
assurance can be given as to the liquidity of the trading market for the Series
A Capital Securities.
The Series A Capital Securities may trade at prices that do not fully
reflect the value of accrued and unpaid interest with respect to the underlying
Series A Subordinated Debentures. See "Certain Federal Income Tax
Consequences -- Interest Income and Original Issue Discount" and "-- Sales or
Redemption of Series A Capital Securities" for a discussion of the United States
federal income tax consequences that may result from a taxable disposition of
the Series A Capital Securities.
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USBANCORP CAPITAL TRUST I
USBANCORP Capital Trust I (the "Issuer") is a statutory business trust
created under Delaware law pursuant to (i) the Series A Trust Agreement executed
by the Corporation, as Depositor, The Bank of New York, as Property Trustee, The
Bank of New York (Delaware), as Delaware Trustee, and the Administrative
Trustees named therein, and (ii) the filing of a certificate of trust with the
Delaware Secretary of State on April 15, 1998. The Series A Trust Agreement will
be qualified as an indenture under the Trust Indenture Act of 1939, as amended
(the "Trust Indenture Act"). The Issuer exists for the exclusive purposes of (i)
issuing and selling the Series A Capital Securities and Series A Common
Securities, (ii) using the proceeds from the sale of Series A Capital Securities
and Series A Common Securities to acquire Series A 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 Series
A Capital Securities). Accordingly, the Series A Subordinated Debentures will be
the sole assets of the Issuer, and payments under the Series A Subordinated
Debentures will be the sole revenue of the Issuer.
All of the Series A Common Securities will be owned by the Corporation. The
Series A Common Securities will rank pari passu, and payments will be made
thereon pro rata, with the Series A Capital Securities, except that upon the
occurrence and continuance of an event of default under the Series A Trust
Agreement resulting from an event of default under the Indenture, the rights of
the Corporation as holder of the Series A 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 Series A Capital
Securities. See "Description of Series A Capital Securities -- Subordination of
Common Securities." The Corporation will acquire Series A Common Securities in
an aggregate Liquidation Amount at least 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 Series A Trust Agreement. The Issuer's business and affairs are conducted by
the Issuer Trustees: The Bank of New York, as Property Trustee, and The Bank of
New York (Delaware), as Delaware Trustee, and individual Administrative Trustees
who are employees or officers of or affiliated with the Corporation. The Bank of
New York, as Property Trustee, will act as sole trustee under the Series A Trust
Agreement for purposes of compliance with the Trust Indenture Act. The Bank of
New York will also act as trustee under the Series A Guarantee and the
Indenture. See "Description of Series A Guarantee" and "Description of Series A
Subordinated Debentures." The holder of the Series A Common Securities of the
Issuer, or the holders of a majority in Liquidation Amount of the Series A
Capital Securities if an event of default under the Series A Trust Agreement has
occurred and is continuing, will be entitled to appoint, remove or replace the
Property Trustee and/or the Delaware Trustee. In no event will the holders of
the Series A Capital Securities have the right to vote to appoint, remove or
replace the Administrative Trustees; such voting rights are vested exclusively
in the holder of the Series A Common Securities. The Corporation will pay all
fees and expenses related to each Issuer and the offering of the Series A
Capital Securities and will pay, directly or indirectly, all ongoing costs,
expenses and liabilities of each Issuer.
The principal executive office of the Issuer is c/o The Bank of New York
(Delaware), White Clay Center, Newark, Delaware 19711, Attention: Corporate
Trust Department and its telephone number is (814) 533-5300.
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").
USBANCORP, INC.
GENERAL
The Corporation is a registered bank holding company organized under the
Pennsylvania Business Corporation Law and is registered under the Bank Holding
Corporation Act of 1956, as amended (the "BHCA"). The Corporation's principal
activities consist of owning and operating its five wholly-owned
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subsidiary entities, U.S. Bank, Three Rivers Bank, USBANCORP Trust Corporation,
United Bancorp Life Insurance Corporation and UBAN Associates. At December 31,
1997, the Corporation had, on a consolidated basis, total assets, deposits, and
shareholders' equity of $2.24 billion, $1.14 billion and $158 million,
respectively.
The Corporation and the subsidiary entities derive substantially all of
their income from banking and bank-related services. The Corporation functions
primarily as a coordinating and servicing unit for its subsidiary entities in
general management, credit policies and procedures, accounting and taxes, loan
review, auditing, investment advisory, compliance, marketing, insurance risk
management, general corporate services, and financial and strategic planning.
The Corporation, as a bank holding company, is regulated under the BHCA, and is
supervised by the Board of Governors of the Federal Reserve System.
USBANCORP BANKING SUBSIDIARIES:
U.S. Bank
U.S. Bank is a national banking association organized under the laws of the
United States. Through 20 locations in Cambria, Clearfield, Somerset, and
Westmoreland Counties, Pennsylvania, U.S. Bank conducts a general banking
business. It is a full-service bank offering (i) retail banking services; (ii)
lending, depository and related financial services to commercial, industrial,
financial, and governmental customers; and (iii) credit card operations through
MasterCard and VISA. U.S. Bank also operates 24 automated bank teller machines
("ATMs") through its 24-Hour Banking Network which is linked with MAC(R), a
regional ATM(R) network, and CIRRUS, a national ATM network. Additionally, USNB
Financial Services Corporation, a wholly owned subsidiary of U.S. Bank, engages
in the sale of annuities, mutual funds, and insurance.
Three Rivers Bank
Three Rivers Bank is a state bank chartered under the Pennsylvania Banking
Code of 1965, as amended. Through 23 locations in Allegheny and Washington
Counties, Pennsylvania, Three Rivers Bank conducts a general retail banking
business consisting of granting commercial, consumer, construction, mortgage and
student loans, and offering checking, interest bearing demand, savings and time
deposit services. It also operates 23 ATMs that are affiliated with MAC(R), and
Plus System(R), a national ATM network. Three Rivers Bank also offers wholesale
banking services to other banks, merchants, governmental units, and other large
commercial accounts. Three Rivers Bank has also executed an agreement to acquire
two additional branches having approximately $38 million in deposits from
another financial institution. Three Rivers is paying a deposit premium of 7%
and an existing Three Rivers Bank branch will be consolidated into one of the
acquired branches. Three Rivers Bank also has two wholly owned mortgage banking
subsidiaries -- Standard Mortgage Corporation and UBAN Mortgage Corporation.
Standard Mortgage Corporation, based in Atlanta, Georgia, is a mortgage banking
company that originates, sells, and services residential mortgage loans. UBAN
Mortgage Corporation was formed in January 1997 for the purpose of originating
and selling mortgage loans primarily in Western Pennsylvania. Additionally, TRB
Financial Services Corporation, a wholly owned subsidiary of Three Rivers Bank,
engages in the sale of annuities and mutual funds.
USBANCORP NON-BANKING SUBSIDIARIES:
USBANCORP Trust Corporation
USBANCORP Trust Corporation is a trust company organized under Pennsylvania
law which offers a complete range of trust services through each of the
Corporation's subsidiary banks. At December 31, 1997, USBANCORP Trust
Corporation had $1.12 billion in assets under management which included both
discretionary and non-discretionary assets.
United Life
United Life is a captive insurance company organized under the laws of the
State of Arizona. United Life engages in underwriting, as reinsurer, of credit
life and disability insurance within the Corporation's six county market area.
Operations of United Life are conducted in each office of the Corporation's
banking subsidiaries.
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UBAN Associates
UBAN Associates is a registered investment advisory firm that administers
investment portfolios, offers operational support systems and provides asset and
liability management services to small and mid-sized community banks. UBAN
Associates was formed in January 1997.
Recent Developments
The Corporation's net income for the quarter ended March 31, 1998 was
$5,695,000 or $1.15 on a diluted per share basis compared to net income of
$5,668,000 or $1.10 per diluted share for the quarter ended March 31, 1997.
Earnings per share grew at a faster rate than net income due to the
Corporation's on-going treasury stock repurchase program. The Corporation's
return on equity averaged 14.6% in the first quarter of 1998 compared to a
return on equity of 14.9% in the first quarter of 1997. The Corporation's return
on assets was 1.03% in the first quarter of 1998. At March 31, 1998, the
Corporation had consolidated assets, net loans, deposits and shareholders'
equity of $2.21 billion, $1.02 billion, $1.17 billion and $155.8 million,
respectively. At December 31, 1997, the Corporation had consolidated assets, net
loans, deposits and shareholders' equity of $2.24 billion, $989.6 million, $1.14
billion and $158.2 million, respectively.
USE OF PROCEEDS
All of the proceeds from the sale of the Series A Capital Securities will
be invested by the Issuer in Series A Subordinated Debentures. The Corporation
intends that the proceeds from the sale of the Series A Subordinated Debentures
will be added to its general corporate funds and will be used for general
corporate purposes, including the repayment of debt, the repurchase of
Corporation common stock and investments in and advances to Corporation
subsidiaries.
The Corporation is required by the Federal Reserve to maintain certain
levels of capital for bank regulatory purposes. On October 21, 1996, the Federal
Reserve announced that cumulative preferred securities having the
characteristics of the Series A Capital Securities could be included as Tier 1
Capital for bank holding companies. Such Tier 1 Capital treatment, together with
the Corporation's ability to deduct, for federal income tax purposes, interest
payable on the Series A Subordinated Debentures, will provide the Corporation
with a more cost-effective means of obtaining capital for bank regulatory
purposes than other Tier 1 Capital alternatives currently available to it.
CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES
The following table sets forth the Corporation's consolidated ratios of
earnings to fixed charges and ratios of earnings to combined fixed charges and
preferred stock dividend requirements for each of the periods indicated:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
---------------------------------------------------
1997 1996 1995 1994 1993
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Earnings to Fixed Charges:
Excluding Interest on Deposits......................... 1.72 1.79 1.77 2.34 5.41
Including Interest on Deposits......................... 1.37 1.36 1.30 1.37 1.45
Earnings to Combined Fixed Charges and Preferred Stock
Dividend Requirements:
Excluding Interest on Deposits......................... 1.72 1.79 1.77 2.34 5.26
Including Interest on Deposits......................... 1.37 1.36 1.30 1.37 1.45
</TABLE>
For purposes of computing the ratios of earnings to fixed charges and of
earnings to combined fixed charges and preferred stock dividend requirements,
earnings represent net income from continuing operations plus total taxes based
on income and fixed charges. Fixed charges, excluding interest on deposits,
include interest expense (other than on deposits), one-third (the proportion
deemed representative of the interest factor) of rents, net of income from
subleases, and capitalized interest. Fixed charges, including interest on
deposits, include all interest expense, one-third (the proportion deemed
representative of the interest factor) of rents, net of income from subleases,
and capitalized interest.
16
<PAGE> 18
CAPITALIZATION
The following table sets forth the consolidated capitalization of the
Corporation and its subsidiaries as of December 31, 1997 and as adjusted to give
effect to the consummation of the offering of the Series A Capital Securities
and the issuance of the Series A Subordinated Debentures. The following data
should be read in conjunction with the consolidated financial statements and
notes thereto of the Corporation and its subsidiaries incorporated herein by
reference.
<TABLE>
<CAPTION>
DECEMBER 31, 1997
--------------------------
ACTUAL AS ADJUSTED
------ -----------
(IN THOUSANDS)
(UNAUDITED)
<S> <C> <C>
Federal Funds Purchased and Securities Sold Under
Agreements to Repurchase........................ $ 92,829 $ 92,829
Other Short-term Borrowings....................... 57,892 57,892
Advances from Federal Home Loan Bank.............. 754,195 754,195
Collateralized Mortgage Obligation................ 3,779 3,779
Long-term Debt.................................... 4,361 4,361
Guaranteed Preferred Beneficial Interests in
Corporation's Junior Subordinated Deferrable
Interest Debentures, Series A(1)................ -- 30,000
---------- ----------
Total Debt........................................ $ 913,056 $ 943,056
========== ==========
Shareholders' Equity
Common Stock.................................... 14,402 14,402
Capital Surplus................................. 93,934 93,934
Retained Earnings............................... 78,866 78,866
Net Unrealized Gain on Securities Available for
Sale Net of Taxes............................ 2,153 2,153
Treasury Stock, At Cost......................... (31,175) (31,175)
---------- ----------
Total Shareholders' Equity................... $ 158,180 $ 158,180
---------- ----------
Total Capitalization.............................. $1,071,236 $1,101,236
========== ==========
</TABLE>
- ---------------
(1) As described herein, the sole assets of the Issuer will be
approximately $30,927,850 principal amount of Series A Subordinated Debentures
to be issued by the Corporation to the Issuer. The Series A Subordinated
Debentures will bear interest at the rate of % per annum on the Liquidation
Amount of $25 per Series A Subordinated Debenture and will mature on June 30,
2028. The Corporation will own all of the Series A Common Securities of the
Issuer. It is anticipated that the Issuer will not be subject to the reporting
requirements under the Exchange Act.
17
<PAGE> 19
SELECTED CONSOLIDATED FINANCIAL DATA
<TABLE>
<CAPTION>
AT OR FOR THE YEAR ENDED DECEMBER 31,
--------------------------------------------------------------
1997 1996 1995 1994 1993
---------- ---------- ---------- ---------- ----------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA AND RATIOS)
<S> <C> <C> <C> <C> <C>
SUMMARY OF INCOME STATEMENT DATA:
Total interest income................ $ 154,788 $ 137,333 $ 129,715 $ 102,811 $ 85,735
Total interest expense............... 87,929 76,195 73,568 46,993 36,250
---------- ---------- ---------- ---------- ----------
Net interest income.................. 66,859 61,138 56,147 55,818 49,485
Provision for loan losses.......... 158 90 285 (2,765) 2,400
---------- ---------- ---------- ---------- ----------
Net interest income after provision
for loan losses.................... 66,701 61,048 55,862 58,583 47,085
Total non-interest income............ 20,203 18,689 16,543 8,187 10,150
Total non-interest expense........... 54,104 52,474 50,557 49,519 40,715
---------- ---------- ---------- ---------- ----------
Income before income taxes and
cumulative effect of change in
accounting principle............... 32,800 27,263 21,848 17,251 16,520
Provision for income taxes......... 9,303 7,244 6,045 5,931 5,484
---------- ---------- ---------- ---------- ----------
Income before cumulative effect of
change in accounting principle..... 23,497 20,019 15,803 11,320 11,036
Cumulative effect of change in
accounting principle............ -- -- -- -- 1,452
---------- ---------- ---------- ---------- ----------
Net income........................... $ 23,497 $ 20,019 $ 15,803 $ 11,320 $ 12,488
========== ========== ========== ========== ==========
Net income applicable to common
stock.............................. $ 23,497 $ 20,019 $ 15,803 $ 11,320 $ 12,385
========== ========== ========== ========== ==========
PER COMMON SHARE DATA:(1)
Basic Earnings:
Net income......................... $ 4.69 $ 3.85 $ 2.89 $ 2.18 $ 2.78
Income before cumulative effect of
change in accounting principle,
and acquisition charge.......... 4.69 3.85 2.89 2.54 2.46
Diluted Earnings:
Net income......................... 4.61 3.83 2.88 2.18 2.78
Income before cumulative effect of
change in accounting principle,
and acquisition charge.......... 4.61 3.83 2.88 2.54 2.45
Cash dividends declared.............. 1.60 1.37 1.06 0.97 0.86
Book value at period end............. 32.32 29.90 28.34 24.57 24.67
BALANCE SHEET AND OTHER DATA:
Total assets......................... $2,239,110 $2,087,112 $1,885,372 $1,788,890 $1,241,521
Loans and loans held for sale, net of
unearned income.................... 989,575 939,726 834,634 868,004 727,186
Allowance for loan losses............ 12,113 13,329 14,914 15,590 15,260
Investment securities available for
sale............................... 580,115 455,890 427,112 259,462 428,712
Investment securities held to
maturity........................... 532,341 546,318 463,951 524,638 --
Deposits............................. 1,139,527 1,138,738 1,177,858 1,196,246 1,048,866
Long-term debt....................... 4,361 4,172 5,061 5,806 3,445
Stockholders' equity................. 158,180 151,917 150,492 137,136 116,615
Full-time equivalent employees(2).... 765 759 742 780 665
</TABLE>
18
<PAGE> 20
<TABLE>
<CAPTION>
AT OR FOR THE YEAR ENDED DECEMBER 31,
------------------------------------------------------------
1997 1996 1995 1994 1993
-------- -------- -------- -------- --------
(DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA AND RATIOS)
<S> <C> <C> <C> <C> <C>
SELECTED FINANCIAL RATIOS:
Return on average total equity before SFAS #109
benefit and acquisition charge................. 15.00% 13.36% 11.03% 10.41% 10.13%
Return on average assets before SFAS #109 benefit
and acquisition charge......................... 1.09 1.03 0.87 0.87 0.91
Loans and loans held for sale, net of unearned
income, as a percent of deposits, at period
end............................................ 86.84 82.52 70.86 72.56 69.33
Ratio of average total equity to average
assets......................................... 7.28 7.69 7.85 8.39 8.96
Common stock cash dividends as a percent of net
income applicable to common stock.............. 34.00 35.28 36.43 44.57 32.28
Common and preferred stock cash dividends as a
percent of net income.......................... 34.00 35.28 36.43 44.57 32.84
Interest rate spread............................. 2.97 3.06 2.94 3.47 3.72
Net interest margin.............................. 3.43 3.52 3.45 4.03 4.34
Allowance for loan losses as a percentage of
loans and loans held for sale, net of unearned
income, at period end.......................... 1.22 1.42 1.79 1.80 2.10
Non-performing assets as a percentage of loans
and loans held for sale and other real estate
owned, at period end........................... 0.89 0.92 1.13 0.91 0.89
Net charge-offs as a percentage of average loans
and loans held for sale........................ 0.14 0.20 0.08 0.04 0.13
Ratio of earnings to fixed charges and preferred
dividends:(3)
Excluding interest on deposits................. 1.72x 1.79x 1.77x 2.34x 5.26x
Including interest on deposits................. 1.37 1.36 1.30 1.37 1.45
One Year GAP ratio, at period end................ 0.88 0.79 0.86 0.79 1.10
</TABLE>
- ---------------
(1) The prior years earnings per share have been restated to reflect adoption of
SFAS #128.
(2) Full-time equivalent employees in 1994 include 115 employees as a result of
the Johnstown Savings Bank acquisition. Full-time equivalent employees in
1993 include 18 employees as a result of certain branch acquisitions.
(3) The ratio of earnings to fixed charges and preferred dividends is computed
by dividing the sum of income before taxes, fixed charges, and preferred
dividends by the sum of fixed charges and preferred dividends. Fixed charges
represent interest expense and are shown as both excluding and including
interest on deposits.
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
Series A Capital Securities will be presented as part of a separate line item in
the consolidated balance sheets of the Corporation under the caption "Guaranteed
Preferred Beneficial Interests in Corporation's Junior Subordinated Deferrable
Interest Debentures, Series A" and appropriate disclosures about the Series A
Capital Securities, the Series A Guarantee and the Series A 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 Series A Capital Securities as an expense in the
consolidated statements of income.
The Corporation has agreed that future financial reports of the Corporation
will: (i) present the Series A Capital Securities issued by the Corporation on
the Corporation's balance sheet as a separate line item entitled "Guaranteed
Preferred Beneficial Interests in Corporation's Junior Subordinated Deferrable
Interest Debentures, Series A;" (ii) include in a footnote to the financial
statements disclosure that the sole assets of the trusts are the Series A
Subordinated Debentures (specifying as to each trust the principal amount,
interest
19
<PAGE> 21
rate and maturity date of Series A Subordinated Debentures held); and (iii) if
Staff Accounting Bulletin 53 treatment is sought, include, in an audited
footnote to the financial statements, disclosure that (a) the Issuer is wholly
owned, (b) the sole assets of the trusts are the Series A Subordinated
Debentures (specifying as to each trust the principal amount, interest rate and
maturity date of the Series A Subordinated Debentures held), and (c) the
obligations of the Corporation under the Series A Subordinated Debentures, the
Indenture, the Series A Trust Agreement and the Series A Guarantee, in the
aggregate, constitute a full and unconditional guarantee by the Corporation of
such trust's obligations under the Series A Capital Securities issued by the
Issuer.
DESCRIPTION OF SERIES A CAPITAL SECURITIES
This summary of certain terms and provisions of the Series A Capital
Securities, which describes the material provisions thereof, does not purport to
be complete and is subject to, and qualified in its entirety by reference to,
the Series A Trust Agreement including the definitions therein of certain terms,
and the Trust Indenture Act, to each of which reference is hereby made. Wherever
particular defined terms of the Series A Trust Agreement (as amended or
supplemented from time to time) are referred to herein, such defined terms are
incorporated herein by reference. The form of the Series A Trust Agreement has
been filed as an exhibit to the Registration Statement of which this Prospectus
form a part.
GENERAL
The Series A 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 Series A Subordinated Debentures will be held by the Property
Trustee in trust for the benefit of the holders of the Series A Capital
Securities and Common Securities. The Series A Guarantee Agreement executed by
the Corporation for the benefit of the holders of the Series A Capital
Securities (the "Guarantee") will be a guarantee on a subordinated basis with
respect to the Series A Capital Securities but will not guarantee payment of
Distributions or amounts payable on redemption or liquidation of such Series A
Capital Securities when the Issuer does not have funds on hand available to make
such payments. See "Description of Series A Guarantee."
DISTRIBUTIONS
The Series A Capital Securities represent beneficial ownership interests in
the Issuer, and Distributions on the Series A Capital Securities will be
cumulative, will accumulate from the date of original issuance and will be
payable at the annual rate of % on the stated Liquidation Amount of $25,
payable quarterly in arrears on March 31, June 30, September 30 and December 31
of each year (each, a "Distribution Date"), to the holders of the Series A
Capital Securities on the relevant record dates. The record dates for the Series
A Capital Securities will be, for so long as the Series A Capital Securities
remain in book-entry form, one Business Day (as defined below) prior to the
relevant Distribution Date and, in the event the Series A Capital Securities are
not in book-entry form, the 15th day of the month in which the relevant
Distribution Date occurs. Distributions will accumulate from the date of
original issuance. The first Distribution Date for the Series A Capital
Securities will be June 30, 1998. The period beginning on and including the date
of original issuance and ending on but excluding the first Distribution Date and
each successive period beginning on and including a Distribution Date and ending
on but excluding the next succeeding Distribution Date is herein called a
"Distribution Period". The amount of Distributions payable for any Distribution
Period will be computed on the basis of a 360-day year of twelve 30-day months.
In the event that any Distribution Date would otherwise fall on a day that is
not a Business Day, such Distribution Date shall be postponed to the next day
that is a Business Day (without any additional Distributions or other payment in
respect of such delay) unless it would thereby fall in the next calendar year,
in which event the Distribution Date shall be brought forward to the immediately
preceding Business Day. 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 principal corporate trust office of the Property Trustee is
closed for business.
20
<PAGE> 22
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 Series A Subordinated Debentures at any time or from time to
time for a period not exceeding 20 consecutive quarterly periods with respect to
each Extension Period, provided that no Extension Period may extend beyond the
Stated Maturity of the Series A Subordinated Debentures. As a consequence of any
such deferral of interest payments by the Corporation, quarterly Distributions
on the Series A Capital Securities by the Issuer will also be deferred during
any such Extension Period. Distributions to which holders of the Series A
Capital Securities are entitled will accumulate additional Distributions thereon
at the rate of % per annum, compounded quarterly 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, and may not permit any subsidiary of the Corporation to,
(i) declare or pay any dividends or distributions on, or redeem, purchase,
acquire or make a liquidation payment with respect to, any of the Corporation's
capital stock, (ii) make any payment of principal, interest or premium, if any,
on or repay, repurchase or redeem any debt securities of the Corporation
(including other series of Junior Subordinated Debentures) that rank pari passu
with or junior in interest to the Series A Subordinated Debentures or (iii) make
any guarantee payments with respect to any guarantee by the Corporation of the
debt securities of any subsidiary of the Corporation if such guarantee ranks
pari passu with or junior in interest to the Series A Subordinated Debentures
(other than (a) dividends or distributions in capital stock of the Corporation,
(b) any declaration of a dividend in connection with the implementation of a
shareholders' rights plan or the redemption or repurchase of any such rights
pursuant thereto, (c) payments under the Series A Guarantee and (d) purchases of
common stock related to the issuance of common stock or rights under any of the
Corporation's benefit plans for its directors, officers or employees, related to
the issuance of common stock or rights under a dividend reinvestment and stock
purchase plan, or related to the issuance of common stock (or securities
convertible into or exchangeable for common stock) as consideration in an
acquisition transaction that was entered into prior to the commencement of such
Extension Period). Prior to the termination of any such Extension Period, the
Corporation may further defer the payment of interest on the Series A
Subordinated Debentures, provided that no Extension Period may exceed 20
consecutive quarterly periods or extend beyond the Stated Maturity of the Series
A 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 quarterly, 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 "Description of Series A Subordinated
Debentures -- Option to Defer Interest Payments" and "Certain Federal Income Tax
Consequences -- Interest Income and Original Issue Discount."
The revenue of the Issuer available for distribution to holders of Series A
Capital Securities will be limited to payments under the Series A Subordinated
Debentures in which the Issuer will invest the proceeds from the issuance and
sale of its Series A Capital Securities. See "Description of Series A
Subordinated Debentures." If the Corporation does not make interest payments or
the Series A Subordinated Debentures, the Property Trustee will not have funds
available to pay Distributions on the Series A 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 the basis set forth herein under
"Description of Series A Guarantee."
The Corporation has no current intention of exercising its right to defer
payments of interest by extending the interest payment period on the Series A
Subordinated Debentures.
REDEMPTION
Upon the repayment or redemption, in whole or in part, of the Series A
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 the Series A Capital Securities, upon not less than 30 nor more than
60 days notice prior to the date fixed for redemption, at a redemption price,
with respect to the Series A Capital Securities (the "Redemption Price"), equal
to the aggregate Liquidation Amount of such Series A Capital Securities, plus
accumulated
21
<PAGE> 23
and unpaid Distributions thereon to the date of redemption (the "Redemption
Date"). See "Certain Terms of Series A Subordinated Debentures -- Redemption."
If less than all of the Series A 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 Series A Capital
Securities and the Series A Common Securities.
The Corporation has the right to redeem the Series A Subordinated
Debentures (i) on or after June 30, 2003, in whole at any time or in part from
time to time, or (ii) at any time, in certain circumstances as described under
"Description of Series A Subordinated Debentures -- Conditional Right to Redeem
upon a Tax Event or Capital Treatment Event," in whole (but not in part) within
90 days following the occurrence of a Tax Event or Capital Treatment Event. A
redemption of the Series A Subordinated Debentures would cause a mandatory
redemption of the Series A Capital Securities and the Series A Common
Securities.
REDEMPTION PROCEDURES
Series A Capital Securities redeemed on each Redemption Date shall be
redeemed at the Redemption Price with the applicable proceeds from the
contemporaneous redemption of the Series A Subordinated Debentures. Redemptions
of the Series A Capital Securities shall be made and the Redemption Price shall
be payable on each Redemption Date only to the extent that the Issuer has funds
on hand available for the payment of such Redemption Price. See also
"-- Subordination of Common Securities."
If the Issuer gives a notice of redemption in respect of the Series A
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 Redemption Price and will give
DTC irrevocable instructions and authority to pay the Redemption Price to the
holders of such Series A Capital Securities. See "Book-Entry Issuance." If the
Series A 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 the Series A Capital Securities funds sufficient to pay the
Redemption Price and will give such paying agent irrevocable instructions and
authority to pay the Redemption Price the holders thereof upon surrender of
their certificates evidencing the Series A Capital Securities. Notwithstanding
the foregoing, Distributions payable on or prior to the Redemption Date for the
Series A Capital Securities called for redemption shall be payable to the
holders of Series A 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 Series A Capital Securities so called for redemption will cease,
except the right of the holders of Series A Capital Securities to receive the
Redemption Price, but without interest on such Redemption Price, and such Series
A Capital Securities will cease to be outstanding. In the event that payment of
the Redemption Price in respect of Series A Capital Securities called for
redemption is improperly withheld or refused and not paid either by the Issuer
or by the Corporation pursuant to the Series A Guarantee as described under
"Description of Guarantee," Distributions on the Series A Capital Securities
will continue to accrue at the then applicable rate, from the Redemption Date
originally established by the Issuer for the Series A Capital Securities to the
date such Redemption Price is actually paid, in which case the actual payment
date will be the date fixed for redemption for purposes of calculating the
Redemption Price.
Subject to applicable law (including, without limitation, United States
federal securities law), the Corporation or its subsidiaries may at any time and
from time to time purchase outstanding Series A Capital Securities by tender, in
the open market or by private agreement.
Payment of the Redemption Price on Series A Capital Securities and any
distribution of Series A Subordinated Debentures to holders of Series A Capital
Securities shall be made to the applicable recordholders thereof as they appear
on the register for Series A 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
Series A Capital Securities are not in book-entry form, the relevant record date
for Series A Capital Securities shall be a date at least 15 days prior to the
Redemption Date or liquidation date, as applicable.
22
<PAGE> 24
If less than all of the Series A Capital Securities and Common Securities
issued by an Issuer are to be redeemed on a Redemption Date, then the aggregate
Liquidation Amount of Series A Capital Securities and Common Securities to be
redeemed shall be allocated pro rata to the Series A Capital Securities and the
Common Securities based upon the relative Liquidation Amounts of such classes.
The particular Series A 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 Series A Capital Securities not previously
called for redemption, by such method as the Property Trustee shall deem fair
and appropriate. The Property Trustee shall promptly notify the trust registrar
in writing of the Series A Capital Securities selected for redemption.
Notice of any redemption will be mailed at least 30 days but not more than
60 days before the Redemption Date to each holder of Series A Capital Securities
to be redeemed at its registered address.
LIQUIDATION OF ISSUER AND DISTRIBUTION OF SERIES A SUBORDINATED DEBENTURES TO
HOLDERS
The Corporation will 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, to cause the Series A Subordinated Debentures to be distributed
to the holders of the Series A Capital Securities in exchange therefor upon
liquidation of the Issuer. Such right is subject to the Corporation's having
received prior approval of the Federal Reserve if then required under applicable
capital guidelines or policies.
Under current United States federal income tax law and interpretations and
assuming, as expected, the Issuer is treated as a grantor trust, a distribution
of Series A Subordinated Debentures in exchange for the Series A Capital
Securities should not be a taxable event to holders of the Series A Capital
Securities. Should there be a change in law, a change in legal interpretation, a
Tax Event or other circumstances, however, the distribution could be a taxable
event to holders of the Series A Capital Securities. See "Certain Federal Income
Tax Consequences -- Distribution of Series A Subordinated Debentures to Holders
of Series A Capital Securities." If the Corporation elects neither to redeem the
Series A Subordinated Debentures prior to maturity nor to liquidate the Series A
Issuer and distribute the Series A Subordinated Debentures to holders of the
Series A Capital Securities in exchange therefor, the Series A Capital
Securities will remain outstanding until the Stated Maturity of the Series A
Subordinated Debentures.
If the Corporation elects to liquidate the Issuer and thereby causes the
Series A Subordinated Debentures to be distributed to holders of the Series A
Capital Securities in exchange therefor upon liquidation of the Issuer, the
Corporation shall continue to have the right to redeem the Series A Subordinated
Debentures in certain circumstances upon the occurrence of a Tax Event or
Capital Treatment Event, as described under "Description of Series A
Subordinated Debentures -- Conditional Right to Redeem upon a Tax Event or
Capital Treatment Event."
After the liquidation date fixed for any distribution of the Series A
Subordinated Debentures for the Series A Capital Securities (i) the Series A
Capital Securities will no longer be deemed to be outstanding, (ii) the
depositary or its nominee, as the record holder of the Series A Capital
Securities, will receive a registered global certificate or certificates
representing the Series A Subordinated Debentures to be delivered upon such
distribution and (iii) any certificates representing the Series A Capital
Securities not held by DTC or its nominee will be deemed to represent the Series
A Subordinated Debentures having a principal amount equal to the stated
Liquidation Amount of the Series A Capital Securities, and bearing accrued and
unpaid interest in an amount equal to the accrued and unpaid Distributions on
the Series A Capital Securities until such certificates are presented to the
Administrative Trustees or their agent for transfer or reissuance.
There can be no assurance as to the market prices for the Series A Capital
Securities or the Series A Subordinated Debentures that may be distributed in
exchange for the Series A Capital Securities if a dissolution and liquidation of
the Issuer were to occur. Accordingly, the Series A Capital Securities that an
investor may purchase, or the Series A Subordinated Debentures that the investor
may receive on dissolution and liquidation of the Issuer, may trade at a
discount to the price that the investor paid to purchase the Series A Capital
Securities offered hereby.
23
<PAGE> 25
If a Tax Event or Capital Treatment Event in respect of the Series A
Capital Securities and Common Securities shall occur and be continuing, the
Corporation has the right to redeem the Series A Subordinated Debentures in
whole (but not in part) and thereby cause a mandatory redemption of the Series A
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
Capital Treatment Event. In the event a Tax Event or Capital Treatment Event in
respect of the Series A Capital Securities and Common Securities has occurred
and is continuing and the Corporation does not elect to redeem the Series A
Subordinated Debentures and thereby cause a mandatory redemption of the Series A
Capital Securities and Common Securities or to terminate the Issuer and cause
the Series A Subordinated Debentures to be distributed to holders of the Series
A Capital Securities and Common Securities in exchange therefor upon liquidation
of the Issuer as described above, such Series A Capital Securities will remain
outstanding.
"Like Amount" means (i) with respect to a redemption of the Series A
Capital Securities, the Series A Capital Securities having a Liquidation Amount
(as defined below) equal to that portion of the principal amount of the Series A
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 Series A Capital Securities, and (ii) with respect to a distribution of the
Series A Subordinated Debentures to holders of the Series A Capital Securities
in exchange therefor in connection with a dissolution or liquidation of the
Issuer, the Series A Subordinated Debentures having a principal amount equal to
the Liquidation Amount of the Series A Capital Securities of the holder.
The amount payable on the Series A Capital Securities in the event of any
liquidation of the Issuer is $25 per Series A Capital Security plus accumulated
and unpaid Distributions, which amount may be paid in the form of a distribution
of a Like Amount of Series A Subordinated Debentures.
"Tax Event" with respect to the Issuer means the receipt by the Issuer of
Series A Capital Securities of an opinion of counsel experienced in such matters
to the effect that, as a result of any amendment to, or change (including any
announced proposed change) in, the laws (or any regulations thereunder) of the
United States or any political subdivision or taxing authority thereof or
therein, or as a result of any official administrative pronouncement or judicial
decision interpreting or applying such laws or regulations, which amendment or
change is effective or which proposed change, pronouncement or decision is
announced on or after the date of issuance of the Series A Capital Securities
under the Series A Trust Agreement, 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 Series A Subordinated Debentures, (ii) interest payable by the
Corporation on the Series A 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
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.
SUBORDINATION OF COMMON SECURITIES
Payment of Distributions on, and the Redemption Price of, the Series A
Capital Securities and Common Securities, as applicable, shall be made pro rata
based on the Liquidation Amount of such Series A Capital Securities and Common
Securities; provided, however, that if on any Distribution Date or Redemption
Date a Debenture Event of Default shall have occurred and be continuing, no
payment of any Distribution on, or Redemption Price of, any of the Common
Securities, and no other payment on account of the redemption, liquidation or
other acquisition of such Common Securities, shall be made unless payment in
full in cash of all accumulated and unpaid Distributions on all of the
outstanding Series A Capital Securities for all Distribution periods terminating
on or prior thereto, or in the case of payment of the Redemption Price the full
amount of such Redemption Price on all of the outstanding Series A Capital
Securities then called for redemption, shall have been made or provided for, and
all funds available to the Property Trustee shall first be applied to the
payment in full in cash of all Distributions on, or Redemption Price of, the
Series A Capital Securities then due and payable.
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In the case of any event of default under the Series A Trust Agreement
resulting from a Debenture Event of Default, the Corporation as holder of such
the Common Securities will be deemed to have waived any right to act with
respect to any such event of default under the Series A Trust Agreement until
the effect of all such events of default with respect to such Series A Capital
Securities have been cured, waived or otherwise eliminated. Until all events of
default under the Series A Trust Agreement with respect to the Series A Capital
Securities have been so cured, waived or otherwise eliminated, the Property
Trustee shall act solely on behalf of the holders of Series A Capital Securities
and not on behalf of the Corporation as holder of the Common Securities, and
only the holders of Series A Capital Securities will have the right to direct
the Property Trustee to act on their behalf.
LIQUIDATION DISTRIBUTION UPON TERMINATION
Pursuant to the Series A Trust Agreement, the 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
Corporation; (ii) the distribution of a Like Amount of the Series A Subordinated
Debentures to the holders of Series A Securities, if the Corporation, as
Depositor, has given written direction to the Property Trustee to terminate the
Issuer (subject to the Corporation having received prior approval of the Federal
Reserve if so required under applicable capital guidelines or policies); (iii)
redemption of all Series A Capital Securities as described under "-- 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 an early termination 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 determine to be possible by distributing, after
satisfaction of liabilities to creditors of the Issuer as provided by applicable
law, to the holders of Series A Capital Securities in exchange therefor a Like
Amount of the Series A Subordinated Debentures, unless such distribution is
determined by the Property Trustee not to be practical, in which event such
holders will be entitled to receive out of the assets of the 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 Series A Capital Securities, the aggregate 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 the Issuer has insufficient assets available to pay in
full the aggregate Liquidation Distribution, then the amounts payable directly
by the Issuer on the Series A Capital Securities shall be paid on a pro rata
basis. The holder(s) of the Common Securities will be entitled to receive
distributions upon any such liquidation pro rata with the holders of Series A
Capital Securities, except that if a Debenture Event of Default has occurred and
is continuing, the Series A 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 the
Series A Trust Agreement (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 Series A Subordinated Debentures -- Debenture Events
of Default"); or
(ii) default by the Property Trustee 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 Property Trustee in the payment of any Redemption
Price of any Series A Capital 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 Property Trustee in the Series A 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
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of such default or breach for a period of 90 days after there has been
given, by registered or certified mail, to the defaulting Property Trustee
by the holders of at least 25% in aggregate Liquidation Amount of the
outstanding Series A Capital Securities of the 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 the Series A Trust
Agreement; or
(v) the occurrence of certain events of bankruptcy or insolvency with
respect to the Property Trustee and the failure by the Corporation to
appoint a successor Property Trustee 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 Series A Capital Securities,
the Administrative Trustees and the Corporation, as Depositor, unless such Event
of Default shall have been cured or waived. The Corporation, as Depositor, and
the Administrative Trustees 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 the Series A Trust Agreement.
If a Debenture Event of Default has occurred and is continuing, the Series
A Capital Securities shall have a preference over the Common Securities as
described above. See "-- Subordination of Common Securities" and "-- Liquidation
Distribution Upon Termination." The existence of an Event of Default does not
entitle the holders of Series A Capital Securities to accelerate the maturity
thereof.
REMOVAL OF ISSUER TRUSTEES
Unless a Debenture Event of Default shall have occurred and be continuing,
the Property Trustee and the Delaware Trustee may be removed at any time by the
holder of the Common Securities. If a Debenture Event of Default has occurred
and is continuing, the Property Trustee and the Delaware Trustee may be removed
at such time by the holders of a majority in Liquidation Amount of the
outstanding Series A Capital Securities. In no event will the holders of the
Series A Capital Securities have the right to vote to appoint, remove or replace
the Administrative Trustees, which voting rights are vested exclusively in the
Corporation as the holder of the Common Securities. No resignation or removal of
the Property Trustee or the Delaware 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 Series A Trust Agreement.
CO-TRUSTEES AND SEPARATE PROPERTY TRUSTEE
Unless an Event of Default shall have occurred and be continuing, at any
time or from time to time, 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 Corporation, as the holder of the
Common Securities, and the Administrative Trustees shall have the power to
appoint one or more persons either to act as a co-trustee, jointly with the
Property Trustee, of all or any part of such Trust Property, or 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 such capacity any property, title, right or power deemed necessary or
desirable, subject to the provisions of the Series A Trust Agreement. In case a
Debenture Event of Default has occurred and is continuing, the Property Trustee
alone shall have power to make such appointment.
MERGER OR CONSOLIDATION OF ISSUER TRUSTEES
Any Person into which the Property Trustee, the Delaware Trustee or any
Administrative Trustee that is not a natural person 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 Trustee under the Series A Trust
Agreement, provided such Person shall be otherwise qualified and eligible.
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MERGERS, CONSOLIDATIONS, AMALGAMATIONS OR REPLACEMENTS OF THE ISSUER
The 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 or as otherwise described in the Series A Trust Agreement. The
Issuer may, at the request of the Corporation, with the consent of the
Administrative Trustees and without the consent of the holders of the Series A
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 Series A Capital Securities or (b)
substitutes for the Series A Capital Securities other securities having
substantially the same terms as the Series A Capital Securities (the "Successor
Securities") so long as the Successor Securities rank the same as the Series A
Capital Securities in priority with respect to distributions and payments upon
liquidation, redemption and otherwise, (ii) the Corporation expressly appoints a
trustee of such successor entity possessing the same powers and duties as the
Property Trustee as the holder of the Series A 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 Series A Capital Securities are then listed, if any,
(iv) such merger, consolidation, amalgamation, replacement, conveyance, transfer
or lease does not cause the Series A Capital Securities to be downgraded by any
nationally recognized statistical rating organization, (v) such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease does not
adversely affect the rights, preferences and privileges of the holders of the
Series A Capital Securities (including any Successor Securities) in any material
respect, (vi) such successor entity has a purpose substantially 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 rights, preferences
and privileges of the holders of the Series A 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 of 1940, as amended (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 Series A Guarantee.
Notwithstanding the foregoing, an Issuer shall not, except with the consent of
holders of 100% in Liquidation Amount of the Series A 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 other than a grantor trust for United States federal income tax
purposes.
VOTING RIGHTS; AMENDMENT OF SERIES A TRUST AGREEMENT
Except as provided below and under "Description of Series A
Guarantee -- Amendments and Assignment" and as otherwise required by law and the
Series A Trust Agreement, the holders of the Series A Capital Securities will
have no voting rights.
The Series A Trust Agreement may be amended from time to time by the
Corporation, the Property Trustee and the Administrative Trustees, without the
consent of the holders of the Series A 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 the Series A Trust Agreement,
which shall not be inconsistent with the other provisions of the Series A Trust
Agreement, or (ii) to modify, eliminate or add to any provisions of such Series
A Trust Agreement to such extent as shall be necessary to ensure that the Issuer
will be classified for United States federal income tax purposes as a grantor
trust at all times that any Series A Capital Securities are outstanding or to
ensure that the 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 clause (ii), such action shall not
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adversely affect in any material respect the interests of any holder of Series A
Capital Securities, and any such amendments of the Series A Trust Agreement
shall become effective when notice thereof is given to the holders of Series A
Capital Securities. The Series A Trust Agreement may be amended by the Issuer
Trustees and the Corporation with (i) the consent of holders representing not
less than a majority (based upon Liquidation Amounts) of the outstanding Series
A 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 in accordance with such amendment will not affect the
Issuer's status as a grantor trust for United States federal income tax purposes
or the Issuer's exemption from status as an "investment company" under the
Investment Company Act, provided that without the consent of each holder of
Series A Capital Securities, the Series A Trust Agreement may not be amended to
(i) change the amount or timing of any Distribution on the Series A Capital
Securities or otherwise adversely affect the amount of any Distribution required
to be made in respect of the Series A Capital Securities as of a specified date
or (ii) restrict the right of a holder of Series A Capital Securities to
institute suit for the enforcement of any such payment on or after such date.
So long as Series A Subordinated Debentures are held by the Property
Trustee, the Issuer Trustees 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
such Series A 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 Series A Subordinated Debentures shall
be due and payable or (iv) consent to any amendment, modification or termination
of the Indenture or Series A 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 Series A
Capital Securities; provided, however, that where a consent under the Indenture
would require the consent of each holder of Series A Subordinated Debentures
affected thereby, no such consent shall be given by the Property Trustee without
the prior consent of each holder of the Series A Capital Securities. The Issuer
Trustees shall not revoke any action previously authorized or approved by a vote
of the holders of the Series A Capital Securities except by subsequent vote of
the holders of the Series A Capital Securities. The Property Trustee shall
notify each holder of Series A Capital Securities of any notice of default with
respect to the Series A Subordinated Debentures. In addition to obtaining the
foregoing approvals of the holders of the Series A Capital Securities, prior to
taking any of the foregoing actions, the Issuer Trustees shall obtain an opinion
of counsel experienced in such matters to the effect that such action would not
cause the Issuer to be classified as other than a grantor trust for United
States federal income tax purposes.
Any required approval of holders of Series A Capital Securities may be
given at a meeting of holders of Series A 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 Series A 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 Series A Capital Securities
in the manner set forth in the Series A Trust Agreement.
No vote or consent of the holders of Series A Capital Securities will be
required for the issuer to redeem and cancel Series A Capital Securities in
accordance with the Series A Trust Agreement.
Notwithstanding that holders of Series A Capital Securities are entitled to
vote or consent under any of the circumstances described above, any of the
Series A 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.
REGISTRATION OF SERIES A CAPITAL SECURITIES
The Series A Capital Securities will be represented by global certificates
registered in the name of DTC or its nominee. Beneficial interests in the Series
A Capital Securities will be shown on, and transfers thereof will be effected
only through, records maintained by participants in DTC. Except as described
below, Series A Capital Securities in certificated form will not be issued in
exchange for the global certificates. See "Book-Entry Issuance."
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Upon the issuance of a global Series A capital security, and the deposit of
such Series A global capital security with DTC will credit, on its book-entry
registration and transfer system, the respective aggregate Liquidation Amounts
of the individual Series A Capital Securities represented by such Series A
global preferred securities to the accounts of Participants, which may include
Euroclear and Cedel. Such accounts shall be designated by the dealers,
underwriters or agents with respect to Series A Capital Securities. Ownership of
beneficial interests in the Series A global capital security will be limited to
Participants or persons that may hold interests through Participants including
Euroclear and Cedel. Ownership of beneficial interests in the Series A global
preferred security will be shown on, and the transfer of that ownership will be
effected only through, records maintained by DTC (with respect to interests of
Participants) and the records of Participants (with respect to interests of
persons who hold through Participants). The laws of some states require that
certain purchasers of securities take physical delivery of such securities in
definitive form. Such limits and such laws may impair the ability to transfer
beneficial interests in the Series A global capital security.
So long as DTC is the registered owner of global preferred security, DTC
will be considered the sole owner or holder of the Series A Capital Securities
represented by such global capital security for all purposes under the Indenture
governing the Series A Capital Securities. Except as provided below, owners of
beneficial interests in the Series A global preferred security will not be
entitled to have any of the individual Series A Capital Securities registered in
their names, will not receive or be entitled to receive physical delivery of any
such Series A Capital Securities of such series in definitive form and will not
be considered the owners or holders thereof under the Indenture.
A global security shall be exchangeable for Series A Capital Securities
registered in the names of persons other than DTC or its nominee only if (i) DTC
notifies the Series A Issuer 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 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 Series
A 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 Series A Capital Securities are issued in definitive form, such
Series A Capital Securities will be in denominations of $25 and integral
multiples thereof and may be transferred or exchanged at the offices described
below.
Payments on and any distributions of Series A Subordinated Debentures in
exchange for Series A Capital Securities represented by a global security will
be made to DTC, as the depositary for the Series A Capital Securities. In the
event Series A Capital Securities are issued in certificated form, the
Liquidation Amount and Distributions will be payable, the transfer of the Series
A Capital Securities will be registrable, Series A Subordinated Debentures will
be distributed in exchange for Series A Capital Securities following a
termination of the Issuer and Series A Capital Securities will be exchangeable
for Series A Capital Securities of other denominations of a like aggregate
Liquidation Amount, at the principal corporate trust office of the Property
Trustee in New York, New York, or at the offices of any paying agent or transfer
agent appointed by the Administrative Trustees, provided that payment of any
Distribution may be made at the option of the Administrative Trustees by check
mailed to the address of the persons entitled thereto or by wire transfer. None
of the Corporation, the Property Trustee, any Paying Agent, or the Securities
Registrar for the Series A 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 securities representing
the Series A Capital Securities or for maintaining, supervising or reviewing any
records relating to such beneficial ownership interests. In addition, if the
Series A Capital Securities are issued in certificated form, the record dates
for payment of Distributions will be the 15th day of the month preceding the
month in which the relevant Distribution payment is scheduled to be paid. For a
description of DTC and the terms of the
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depositary arrangements relating to payments, transfers, voting rights,
redemptions and other notices and other matters, see "Book-Entry Issuance."
The Corporation expects that DTC, upon receipt of any payment of
Liquidation Amount, Redemption Price, premium or Distributions in respect of the
Series A global preferred security representing any of the Series A Capital
Securities, immediately will credit Participants' accounts with payments in
amounts proportionate to their respective beneficial interest in the aggregate
Liquidation Amount of the Series A global preferred security for the Series A
Capital Securities as shown on the records of DTC. The Corporation also expects
that payments by Participants to owners of beneficial interests in the Series A
global preferred 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.
PAYMENT AND PAYING AGENCY
Payments in respect of the Series A Capital Securities shall be made to
DTC, which shall credit the relevant accounts at the Depositary on the
applicable Distribution Dates or, if the Series A 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. 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
Administrative Trustees and the Corporation. 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 Administrative Trustees shall appoint a successor (which
shall be a bank or trust company acceptable to the Administrative Trustees and
the Corporation) to act as Paying Agent.
REGISTRAR AND TRANSFER AGENT
The Property Trustee will act as registrar and transfer agent for the
Series A Capital Securities.
Registration of transfers of Series A Capital Securities will be effected
without charge by or on behalf of the 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 Series A Capital Securities after Series A 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 the Series A 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 Series A Trust Agreement at the request of any holder of Series A
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
Series A Trust Agreement or is unsure of the application of any provision of the
Series A Trust Agreement and the matter is not one on which holders of Series A
Capital Securities are entitled under the Series A Trust Agreement to vote, then
the Property Trustee shall take such action as is directed by the Corporation
and if not so directed, shall take such action as it deems advisable and in the
best interests of the holders of the Series A Capital Securities and will have
no liability except for its own bad faith, negligence or willful misconduct.
MISCELLANEOUS
The Administrative Trustees are authorized and directed to conduct the
affairs of and to operate the Issuer in such a way that the Issuer will not be
deemed to be an "investment company" required to be
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registered under the Investment Company Act or classified as other than a
grantor trust for United States federal income tax purposes and so that the
Series A Junior Subordinated Debentures will be treated as indebtedness of the
Corporation for United States federal income tax purposes. In this connection,
the Corporation and the Administrative Trustees are authorized to take any
action, not inconsistent with applicable law, the certificate of trust of each
Issuer or the Series A Trust Agreement, that the Corporation and the
Administrative Trustees determine in their discretion to be necessary or
desirable for such purposes, as long as such action does not materially
adversely affect the interests of the holders of the Series A Capital
Securities.
Holders of the Series A 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.
DESCRIPTION OF SERIES A SUBORDINATED DEBENTURES
This summary of certain terms and provisions of the Series A Subordinated
Debentures set forth below, which describes the material provisions thereof,
does not purport to be complete and is subject to, and qualified in its entirety
by reference to, the Indenture, and the Trust Indenture Act, to each of which
reference is hereby made. The Indenture has been filed as an exhibit to the
Registration Statement of which this Prospectus forms a part. 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, such defined terms are incorporated herein by reference.
Concurrently with the issuance of the Series A Capital Securities, the
Issuer will invest the proceeds thereof, together with the consideration paid by
the Corporation for the Series A Common Securities, in the Series A Subordinated
Debentures issued by the Corporation. The Series A Subordinated Debentures will
bear interest at the annual rate of % of the principal amount thereof,
payable quarterly in arrears on March 31, June 30, September 30 and December 31
of each year (each, an "Interest Payment Date"), commencing June 30, 1998, and
at maturity to the person in whose name each Series A Subordinated Debenture is
registered at the close of business on the record date next preceding such
Interest Payment Date. The period beginning on and including the date of
original issuance of the Series A Subordinated Debentures and ending on but
excluding the first Interest Payment Date and each successive period beginning
on and including an Interest Payment Date and ending on but excluding the next
succeeding Interest Payment Date is herein called an "Interest Period." It is
anticipated that, until the liquidation, if any, of the Issuer, each Series A
Subordinated Debenture will be held by the Property Trustee in trust for the
benefit of the holders of the Series A Capital Securities. The amount of
interest payable for any Interest Period will be computed on the basis of a
360-day year of twelve 30-day months. In the event that any Interest Payment
Date would otherwise fall on a day that is not a Business Day, such Interest
Payment Date shall be postponed to the next day that is a Business Day (without
any interest or other payment in respect of any such delay) unless it would
thereby fall in the next calendar year, in which event the Interest Payment Date
shall be brought forward to the immediately preceding Business Day. 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 of % per annum, compounded quarterly from the relevant Interest
Payment Date. The term "interest" as used herein shall include quarterly
interest payments and interest on quarterly interest payments not paid on the
applicable Interest Payment Date, as applicable. Notwithstanding anything to the
contrary set forth above, if the maturity date falls on a day that is not a
Business Day, the payment of principal and interest will be paid on the next
succeeding Business Day, with the same force and effect as if made on such
maturity date and no interest on such payments will accrue from and after the
maturity date.
The Series A Subordinated Debentures will be issued as a series of junior
subordinated deferrable interest debentures under the Indenture.
The Series A Subordinated Debentures will mature on June 30, 2028.
The Series A Subordinated Debentures will be unsecured and will rank junior
and be subordinate in right of payment to all Senior Debt of the Corporation.
See "Subordinated Debentures -- Subordination." Substantially all of the
Corporation's existing indebtedness constitutes Senior Debt. Because the
Corporation
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is a holding company, the right of the Corporation to participate in any
distribution of assets of any subsidiary, including the U.S. Bank and Three
Rivers Bank, upon such subsidiary's liquidation or reorganization or otherwise,
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 Series A Subordinated Debentures and the Series A
Guarantee will be effectively subordinated to all existing and future
liabilities of the Corporation's subsidiaries, and holders of Series A
Subordinated Debentures and beneficiaries of the Series A Guarantee should look
only to the assets of the Corporation for payments on the Series A Subordinated
Debentures or under the Series A Guarantee. 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."
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 Series A Subordinated Debentures to
defer payment of interest on the Series A Subordinated Debentures for a period
not exceeding 20 consecutive quarterly periods with respect to each Extension
Period, provided that no Extension Period may extend beyond the Stated Maturity
of the Series A Subordinated Debentures. At the end of such Extension Period,
the Corporation must pay all interest then accrued and unpaid on the Series A
Subordinated Debentures (together with interest on such unpaid interest at the
rate of % per annum, compounded quarterly from the relevant Interest Payment
Date, to the extent permitted by applicable law). During an Extension Period,
interest will accrue and holders of Series A Subordinated Debentures (or holders
of Series A Capital Securities while such series is outstanding) will be
required to accrue interest income for United States federal income tax
purposes. See "Certain Federal Income Tax Consequences -- Interest Income and
Original Issue Discount."
During any such Extension Period, the Corporation may not, and may not
permit any subsidiary of the Corporation to, (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire or make a liquidation payment
with respect to, any of the Corporation's capital stock, (ii) make any payment
of principal, interest or premium, if any, on or repay, repurchase or redeem any
debt securities of the Corporation (including other series of Junior
Subordinated Debentures) that rank pari passu with or junior in interest to the
Series A Subordinated Debentures or (iii) make any guarantee payments with
respect to any guarantee by the Corporation of the debt securities of any
subsidiary of the Corporation if such guarantee ranks pari passu with or junior
in interest to the Series A Subordinated Debentures (other than (a) dividends or
distributions in capital stock of the Corporation, (b) any declaration of a
dividend in connection with the implementation of a shareholders' rights plan,
or the redemption or repurchase of any such rights pursuant thereto, (c)
payments under the Series A Guarantee, and (d) purchases of common stock related
to the issuance of common stock or rights under any of the Corporation's benefit
plans for its directors, officers or employees, related to the issuance of
common stock or rights under a dividend reinvestment and stock purchase plan, or
related to the issuance of common stock (or securities convertible into or
exchangeable for common stock) as consideration in an acquisition transaction
that was entered into prior to the commencement of such Extension Period). Prior
to the termination of any such Extension Period, the Corporation may further
defer the payment of interest on the Series A Subordinated Debentures, provided
that no Extension Period may exceed 20 consecutive quarterly periods or extend
beyond the Stated Maturity of the Series A 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 quarterly, 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 Property Trustee, the
Administrative Trustees and the Debenture Trustee notice of its election to
begin such Extension Period at least one Business Day prior to the earlier of
(i) the date Distributions on the Series A Capital Securities would have been
payable except for the election to begin such Extension Period, (ii) the date
the Administrative Trustees are required to give notice to the New York Stock
Exchange, the Nasdaq National Market or other applicable stock exchange or
automated quotation system on
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which the Series A Capital Securities may then be listed or quoted or to holders
of Series A Subordinated Debentures of the record date for such Distributions or
(iii) the date such Distributions are 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 Series A Subordinated Debentures. There is no limitation on the
number of times that the Corporation may elect to begin an Extension Period.
TRUST COSTS AND EXPENSES
In the Indenture, the Corporation, as borrower, has agreed to pay all debts
and other obligations (other than with respect to the Series A 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) and to pay any and all taxes and all costs and expenses with respect
thereto (other than United States withholding taxes) to which the Issuer might
become subject.
PAYMENT AND PAYING AGENTS
Payment of principal of and any interest on Series A 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 that at the option of the
Corporation payment of any 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 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 Record Date. Payment of any
interest on Series A Subordinated Debentures will be made to the person in whose
name such Series A Subordinated Debentures are registered at the close of
business on the 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
the Series A 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 or
interest on any Series A Subordinated Debenture and remaining unclaimed for two
years after such principal or interest has become due and payable shall, at the
request of the Corporation, be repaid to the Corporation and the holder of such
Series A Subordinated Debenture shall thereafter look, as a general unsecured
creditor, only to the Corporation for payment thereof.
REDEMPTION
Subject to the Corporation's having received prior approval of the Federal
Reserve if then required under applicable capital guidelines or policies, the
Series A Subordinated Debentures are redeemable prior to maturity at the option
of the Corporation (i) on or after June 30, 2003, in whole at any time or in
part from time to time or (ii) at any time, in certain circumstances as
described under "-- Conditional Right to Redeem upon a Tax Event or Capital
Treatment Event," in whole (but not in part) within 90 days following the
occurrence of a Tax Event or Capital Treatment Event. The proceeds of any such
redemption will be used by the Issuer to redeem the Series A Securities.
The redemption price with respect to the Series A Subordinated Debentures
shall be equal to 100% of the principal amount of the Series A Subordinated
Debentures so redeemed plus accrued and unpaid interest thereon to the date of
redemption.
Notice of any redemption will be mailed at least 30 days but not more than
60 days before the redemption date to each holder of Series A 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 will cease to accrue on such Series A Subordinated Debentures or
portions thereof called for redemption.
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DISTRIBUTION OF SERIES A SUBORDINATED DEBENTURES
As described under "Description of Series A Capital
Securities -- Liquidation of Issuer and Distribution of Series A Subordinated
Debentures to Holders," under certain circumstances involving the termination of
the Issuer, Series A Subordinated Debentures may be distributed to the holders
of the Series A 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 Series A Capital Securities, the
Series A Subordinated Debentures will initially be issued in the form of one or
more global securities and DTC, or any successor depositary for the Series A
Capital Securities, will act as depositary for the Series A Subordinated
Debentures. It is anticipated that the depositary arrangements for the Series A
Subordinated Debentures would be substantially identical to those in effect for
the Series A Capital Securities. If Series A Subordinated Debentures are
distributed to the holders of Series A Capital Securities in exchange therefor
upon the liquidation of the Issuer, the Corporation will use its best efforts to
list the Subordinated Debentures on the New York Stock Exchange or such other
stock exchanges or automated quotation systems, if any, on which the Series A
Capital Securities are then listed or quoted. There can be no assurance as to
the market price of any Series A Subordinated Debentures that may be distributed
to the holders of Series A Capital Securities.
CONDITIONAL RIGHT TO REDEEM UPON A TAX EVENT OR CAPITAL TREATMENT EVENT
If a Tax Event or a Capital Treatment Event occurs and either (i) in the
opinion of counsel to the Corporation experienced in such matters, there would
in all cases, after effecting the termination of the Issuer and the distribution
of the Series A Subordinated Debentures to the holders of the Series A Capital
Securities in exchange therefor upon liquidation of the Issuer, be more than an
insubstantial risk that an Adverse Tax Consequence (as defined in "Risk
Factors -- Tax Event or Capital Treatment Event -- Exchange of Series A Capital
Securities for Series A Subordinated Debentures or Redemption") would continue
to exist, (ii) in the reasonable determination of the Corporation, there would
in all cases, after effecting the termination of the Issuer and the distribution
of the Series A Subordinated Debentures to the holders of the Series A Capital
Securities in exchange therefor upon liquidation of the Issuer, be more than an
insubstantial risk that the Corporation will not be entitled to treat an amount
equal to the Liquidation Amount of the Series A Capital Securities as "Tier 1
Capital" (or the then equivalent thereof) for purposes of the capital adequacy
guidelines of the Federal Reserve, as then in effect and applicable to the
Corporation, or (iii) the Series A Subordinated Debentures are not held by the
Issuer, then the Corporation shall have the right to redeem the Series A
Subordinated Debentures, in whole but not in part, at any time within 90 days
following the occurrence of a Tax Event or Capital Treatment Event at a
redemption price equal to 100% of the principal amount thereof plus accrued and
unpaid interest thereon to the date of redemption. See "-- Redemption" and
"-- Liquidation of Issuer and Distribution of Series A Subordinated Debentures
to Holders."
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 Series A 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 will cease to accrue on such Series A Subordinated Debentures or
portions thereof called for redemption.
REGISTRATION OF SERIES A SUBORDINATED DEBENTURES
The Series A Subordinated Debentures will be registered in the name of the
Issuer. In the event that the Series A Subordinated Debentures are distributed
to holders of Series A Capital Securities, it is anticipated that the depositary
and other arrangements for the Series A Subordinated Debentures will be
substantially identical to those in effect for the Series A Capital Securities,
as applicable. See "Description of Series A Capital Securities -- Registration
of Series A Capital Securities."
RESTRICTIONS ON CERTAIN PAYMENTS
The Corporation will also covenant, as to the Series A Subordinated
Debentures, that it will not, and will not permit any subsidiary of the
Corporation to, (i) declare or pay any dividends or distributions on, or redeem,
purchase, acquire or make a liquidation payment with respect to, any of the
Corporation's capital
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stock, (ii) make any payment of principal, interest or premium, if any, on or
repay or repurchase or redeem any debt securities of the Corporation (including
other series of Junior Subordinated Debentures) that rank pari passu with or
junior in interest to the Series A Subordinated Debentures or (iii) make any
guarantee payments with respect to any guarantee by the Corporation of the debt
securities of any subsidiary of the Corporation if such guarantee ranks pari
passu with or junior in interest to the Series A Subordinated Debentures (other
than (a) dividends or distributions in capital stock of the Corporation, (b) any
declaration of a dividend in connection with the implementation of a
shareholders' rights plan, or the redemption or repurchase of any such rights
pursuant thereto, (c) payments under the Series A Guarantee with respect to the
Series A Capital Securities and (d) purchases of common stock related to the
issuance of common stock or rights under any of the Corporation's benefit plans
for its directors, officers or employees, related to the issuance of common
stock or rights under a dividend reinvestment and stock purchase plan, or
related to the issuance of common stock (or securities convertible into or
exchangeable for common stock) as consideration in an acquisition transaction
that was entered into prior to the commencement of such Extension Period) if at
such time (i) there shall have occurred any event of which the Corporation has
actual knowledge (a) that with the giving of notice or the lapse of time, or
both, would constitute a "Debenture Event of Default" under the Indenture with
respect to the Series A Subordinated Debentures of such series and (b) in
respect of which the Corporation shall not have taken reasonable steps to cure,
(ii) if such Series A Subordinated Debentures are held by an Issuer of a series
of Series A Capital Securities, the Corporation shall be in default with respect
to its payment of any obligations under the Guarantee relating to such Series A
Capital Securities or (iii) the Corporation shall have given notice of its
election of an Extension Period as provided in the Indenture with respect to the
Series A 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 the Series A 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 interests of the holders of the
Series A Subordinated Debentures or the holders of the Series A 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 A Subordinated Debentures affected, to modify the
Indenture in a manner adversely affecting the rights of the holders of the
Series A Subordinated Debentures in any material respect; provided, that no such
modification may, without the consent of the holder of each outstanding Series A
Subordinated Debenture so affected, (i) change the Stated Maturity of the Series
A Subordinated Debentures, or 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 Series A Subordinated Debentures of any
series, the holders of which are required to consent to any such modification of
the Indenture, provided further that, in the case of Series A Subordinated
Debentures, so long as any Series A Capital Securities remain outstanding, (a)
no such modification may be made that adversely affects the holders of such
Series A 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 Series A Capital Securities affected unless and until the principal
of the Series A Subordinated Debentures and all accrued and unpaid interest
thereon have been paid in full and certain other conditions have been satisfied,
and (b) where a consent under the Indenture would require the consent of each
holder of Series A Subordinated Debentures, no such consent shall be given by
the Property Trustee without the prior consent of each holder of Series A
Capital Securities.
In addition, the Corporation and the Debenture Trustee may execute, without
the consent of any holder of the Series A Subordinated Debentures, any
supplemental Indenture for the purpose of creating any new series of Junior
Subordinated Debentures.
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DEBENTURE EVENTS OF DEFAULT
The Indenture provides that any one or more of the following described
events with respect to the Series A Subordinated Debentures that has occurred
and is continuing constitutes a "Debenture Event of Default" with respect to the
Series A Subordinated Debentures:
(i) failure for 30 days to pay any interest on the Series A
Subordinated Debentures 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 the Series A
Subordinated Debentures when due whether at maturity or upon redemption; or
(iii) failure to observe or perform in any material respect certain
other covenants contained in the Indenture for 90 days after written notice
to the Corporation from the Debenture Trustee or the holders of at least
25% in aggregate outstanding principal amount of the Series A 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
Series A Subordinated Debentures 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 Series A Subordinated Debentures may declare the
principal due and payable immediately upon a Debenture Event of Default, should
the Debenture Trustee or such holders of such Series A Junior Subordinated
Debentures fail to make such declaration, the holders of at least 25% in
aggregate Liquidation Amount of the Series A Capital Securities shall have such
right. The holders of a majority in aggregate outstanding principal amount of
Series A Subordinated Debentures may annul such declaration of such Subordinated
Debentures fail to annul such declaration and waive such default, the holders of
a majority in aggregate Liquidation Amount of the Series A Capital Securities
affected shall have such right.
The holders of a majority in aggregate outstanding principal amount of
Series A Subordinated Debentures affected thereby may, on behalf of the holders
of all Series A Subordinated Debentures, waive any default, except a default in
the payment of principal or interest (unless such default has been cured and a
sum sufficient to pay all matured installments of interest and principal due
otherwise than by acceleration has been deposited with the 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
Series A Subordinated Debenture. Should the holders of Series A Subordinated
Debentures fail to waive such default, the holders of a majority in aggregate
Liquidation Amount of the Series A Capital Securities affected 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
the Series A Subordinated Debentures, the Property Trustee will have the right
to declare the principal of and the interest on the Series A 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
the Series A Subordinated Debentures.
ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF SERIES A CAPITAL SECURITIES
If a Debenture Event of Default with respect to the Series A Subordinated
Debentures has occurred and is continuing and such event is attributable to the
failure of the Corporation to pay interest or principal on such the Series A
Subordinated Debentures on the date such interest or principal is due and
payable, a holder of Series A 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 the Series A Subordinated Debentures
having a principal amount equal to the aggregate Liquidation Amount of the
Series A 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 Series A
Capital Securities
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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 Series A Capital Securities by the Corporation in connection
with a Direct Action.
The holders of the Series A 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 Series A Subordinated Debentures unless there
shall have been an event of default under the Series A Trust Agreement. See
"Description of Preferred 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 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 Series A 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; (iii) such transaction is not prohibited under the
Series A Trust Agreement and Series A Guarantee and does not give rise to any
breach or violation of the Series A Trust Agreement or Series A Guarantee, and
(iv) certain other conditions as prescribed by the Indenture are met.
The general provisions of the Indenture do not afford holders of the Series
A Subordinated Debentures protection in the event of a highly leveraged or other
transaction involving the Corporation that may adversely affect holders of the
Series A Subordinated Debentures.
SATISFACTION AND DISCHARGE
The Indenture provides that when, among other things, all Series A
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 Series A Subordinated
Debentures are payable sufficient to pay and discharge the entire indebtedness
on the Series A Subordinated Debentures not previously delivered to the
Debenture Trustee for cancellation, for the principal and interest to the date
of the deposit or to the Stated Maturity, as the case may 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
In the Indenture, the Corporation has covenanted and agreed that the Series
A Subordinated Debentures issued thereunder will be subordinate and junior in
right of payment to all Senior Debt to the extent provided in the Indenture.
Upon any payment or distribution of assets of the Corporation upon any
liquidation, dissolution, winding up, reorganization, assignment for the benefit
of creditors, marshaling of assets or any bankruptcy, insolvency, debt
restructuring or similar proceedings in connection with any insolvency or
bankruptcy proceeding of the Corporation, the holders of Senior Debt will first
be entitled to receive payment in full of principal of (and premium, if any) and
interest, if any, on such Senior Debt before the holders of Series A
Subordinated Debentures will be entitled to receive or retain any payment in
respect of the principal of (and premium, if any) or interest, if any, on the
Series A Subordinated Debentures; provided, however, that holders of Senior Debt
shall not be entitled to receive payment of any such amounts to the extent that
such holders would be required by the subordination provisions of such Senior
Debt to pay such amounts over to the
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obligees on trade accounts payable or other liabilities arising in the ordinary
course of the Corporation's business.
In the event of the acceleration of the maturity of Series A Subordinated
Debentures, the holders of all Senior Debt outstanding at the time of such
acceleration will first be entitled to receive payment in full of all amounts
due thereon (including any amounts due upon acceleration thereof) before the
holders of Series A Subordinated Debentures will be entitled to receive or
retain any payment in respect of the principal of (or premium, if any) or
interest, if any, on the Series A Subordinated Debentures; provided, however,
that holders of Senior Debt shall not be entitled to receive payment of any such
amounts to the extent that such holders would be required by the subordination
provisions of such Senior Debt to pay such amounts over to the obligees on trade
accounts payable or other liabilities arising in the ordinary course of the
Corporation's business.
No payments on account of principal or interest in respect of the Series A
Subordinated Debentures may be made if there shall have occurred and be
continuing a default in any payment with respect to Senior Debt or an event of
default with respect to any Senior Debt resulting in the acceleration of the
maturity thereof, or if any judicial proceeding shall be pending with respect to
any such default.
"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, (i) every
obligation of such Person for money borrowed; (ii) every obligation of such
Person evidenced by bonds, debentures, notes or other similar instruments,
including obligations incurred in connection with the acquisition of property,
assets or businesses; (iii) every reimbursement obligation of such Person with
respect to letters of credit, bankers' acceptances or similar facilities issued
for the account of such Person; (iv) every obligation of such Person issued or
assumed as the deferred purchase price of property or services (but excluding
trade accounts payable or accrued liabilities arising in the ordinary course of
business); (v) every capital lease obligation of such Person; (vi) every
obligation of such Person for claims in respect of derivative products such as
interest and foreign exchange rate contracts, commodity contracts and similar
arrangements; and (vii) every obligation of the type referred to in clauses (i)
through (vi) of another Person and all dividends of another Person the payment
of which, in either case, such Person has guaranteed or is responsible or liable
for, directly or indirectly, as obligor or otherwise.
"Senior Debt" 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,
whether incurred on or prior to the date of the 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 Series A Subordinated Debentures or to other
Debt which is pari passu with, or subordinated to, the Series A Subordinated
Debentures; provided, however, that Senior Debt shall not be deemed to include
(i) any Debt of the Corporation which when incurred and without respect to any
election under Section 1111(b) of the United States Bankruptcy Code of 1978, as
amended, was without recourse to the Corporation, (ii) any Debt of the
Corporation to any of its subsidiaries, (iii) Debt to any employee of the
Corporation, (iv) Debt which by its terms is subordinated to trade accounts
payable or accrued liabilities arising in the ordinary course of business to the
extent that payments made to the holders of such Debt by the holders of the
Series A Subordinated Debentures as a result of the subordination provisions of
the Indenture would be greater than such payments otherwise would have been as a
result of any obligation of such holders of such Debt to pay amounts over to the
obligees on such trade accounts payable or accrued liabilities arising in the
ordinary course of business as a result of subordination provisions to which
such Debt is subject, and (v) any other debt securities issued pursuant to the
Indenture.
The Indenture places no limitation on the amount of Senior Debt that may be
incurred by the Corporation. The Corporation expects from time to time to incur
additional indebtedness and other obligations constituting Senior Debt.
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GOVERNING LAW
The Indenture is, and the Series A 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 Series A 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.
BOOK-ENTRY ISSUANCE
DTC will act as securities depositary for all of the Series A Capital
Securities. The Series A Capital Securities and the Series A Subordinated
Debentures will be issued only as fully-registered securities registered in the
name of Cede & Co. (DTC's nominee). One or more fully-registered global
certificates will be issued for the Series A Capital Securities of the Issuer
and the Series A Subordinated Debentures, representing in the aggregate the
total number of the Series A Capital Securities or aggregate principal balance
of Series A Subordinated Debentures, respectively, and will be deposited with
the Property Trustee as custodian for DTC.
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 Series A Capital Securities or Series A Subordinated
Debentures within the DTC system must be made by or through Direct Participants,
which will receive a credit for the Series A Capital Securities or Series A
Subordinated Debentures on DTC's records. The ownership interest of each actual
purchaser of each Series A Capital Security and each Series A Subordinated
Debenture ("Beneficial Owner") is in turn to be recorded on the Direct and
Indirect Participants' records, including Euroclear and Cedel. 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 Series A Capital Securities or Series A Subordinated Debentures.
Transfers of ownership interests in the Series A Capital Securities or Series A
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 Series A Capital
Securities or Series A Subordinated Debentures, except in the event that use of
the book-entry system for the Series A Capital Securities of such Issuer or
Series A Subordinated Debentures is discontinued.
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Transfers between Participants will be effected in accordance with DTC's
procedures and will be settled in same-day funds. Transfers between participants
in Euroclear and Cedel will be effected in the ordinary way in accordance with
their respective rules and operating procedures.
Cross-market transfers between Participants, on the one hand, and Euroclear
participants or Cedel participants, on the other hand, will be effected in DTC
in accordance with DTC's rules on behalf of Euroclear or Cedel, as the case may
be, by its respective depositary; however, such cross-market transactions will
require delivery of instructions to Euroclear or Cedel, as the case may be, by
the counterparty in such system in accordance with the rules and procedures and
within the established deadlines (Brussels time) of such system. Euroclear or
Cedel, as the case may be, will, if the transaction meets its settlement
requirements, deliver instructions to its respective depositary to take action
to effect final settlement on its behalf by delivering or receiving interests in
the Series A Capital Securities or Series A Subordinated Debentures in DTC, and
making or receiving payment in accordance with normal procedures for same-day
funds settlement applicable to DTC. Euroclear participants and Cedel
participants may not deliver instructions directly to the depositaries for
Euroclear or Cedel.
Because of time zone differences, the securities account of a Euroclear or
Cedel participant purchasing an interest in a Series A Capital Security or
Series A Subordinated Debenture from a Participant in DTC will be credited, and
any such crediting will be reported to the relevant Euroclear participant or
Cedel participant, during the securities settlement processing day (which must
be a business day for Euroclear and Cedel, as the case may be) immediately
following the DTC settlement date. Cash received in Euroclear or Cedel as a
result of sales of interests in a Series A Capital Security or Series A
Subordinated Debenture by or through a Euroclear or Cedel participant to a
Participant in DTC will be received with value on the DTC settlement date but
will be available in the relevant Euroclear or Cedel cash account only as of the
business day for Euroclear or Cedel following the DTC settlement date.
DTC has no knowledge of the actual Beneficial Owners of the Series A
Capital Securities or Series A Subordinated Debentures; DTC's records reflect
only the identity of the Direct Participants to whose accounts such Series A
Capital Securities or Series A 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 Series A Capital Securities or Series A Subordinated Debentures. If less
than all Series A Capital Securities or the Series A 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 Series A Capital Securities or the
Series A Subordinated Debentures is limited to the holders of record of the
Series A Capital Securities or Series A Subordinated Debentures, in those
instances in which a vote is required, neither DTC nor Cede & Co. will itself
consent or vote with respect to Series A Capital Securities or Series A
Subordinated Debentures. Under its usual procedures, DTC would mail an omnibus
proxy (the "Omnibus Proxy") to the relevant 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 Series A Capital
Securities or Series A Subordinated Debentures are credited on the record date
(identified in a listing attached to the Omnibus Proxy).
Distribution payments on the Series A Capital Securities or the Series A
Subordinated Debentures will be made by the relevant Trustee to DTC. DTC's
practice is to credit Direct Participants' accounts on the relevant payment date
in accordance with their respective holdings shown on DTC's records unless DTC
has reason to believe that it will not receive payments on such payment date.
Payments by Participants to
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Beneficial Owners will be governed by standing instructions and customary
practices and will be the responsibility of such Participant and not of DTC, the
relevant Trustee, the Issuer thereof or the Corporation, subject to any
statutory or regulatory requirements as may be in effect from time to time.
Payment of Distributions to DTC is the responsibility of the relevant Trustee,
disbursement of such payments to Direct Participants is the responsibility of
DTC, and disbursements of such payments to the Beneficial Owners is the
responsibility of Direct and Indirect Participants.
DTC may discontinue providing its services as securities depositary with
respect to any of the Series A Capital Securities or the Series A Subordinated
Debentures at any time by giving reasonable notice to the relevant Trustee and
the Corporation. In the event that a successor securities depositary is not
obtained, definitive Series A Capital Security or Series A Subordinated
Debenture certificates representing such Series A Capital Securities or Series A
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 Series
A Capital Securities or aggregate principal amount of Series A Subordinated
Debentures may determine to discontinue the system of book-entry transfers
through DTC. In any such event, definitive certificates for such Series A
Capital Securities or Series A Subordinated Debentures will be printed and
delivered.
The information in this section concerning DTC and DTC's book-entry system
has been obtained from sources that the Issuer and the Corporation believe to be
accurate, but the Issuer and the Corporation assume no responsibility for the
accuracy thereof. Neither the Issuer nor the Corporation has any responsibility
for the performance by DTC or its Participants of their respective obligations
as described herein or under the rules and procedures governing their respective
operations.
DESCRIPTION OF SERIES A GUARANTEE
The Series A Guarantee will be executed and delivered by the Corporation
concurrently with the issuance by the Issuer of Series A Capital Securities for
the benefit of the holders from time to time of Series A Capital Securities and
Common Securities. The Bank of New York will act as indenture trustee
("Guarantee Trustee") under the Series A Guarantee for the purposes of
compliance with the Trust Indenture Act and the Series A Guarantee will be
qualified as an indenture under the Trust Indenture Act. This summary of certain
provisions of the Guarantee, 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 the Series A 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 Series A Guarantee has been
filed as an exhibit to the Registration Statement of which this Prospectus forms
a part. Reference in this summary to Series A Capital Securities means the
Series A Capital Securities to which the Series A Guarantee relates. The
Guarantee Trustee will hold the Series A Guarantee for the benefit of the
holders of the Series A Capital Securities and Common Securities.
GENERAL
The Series A Guarantee guarantees to the holders of the Series A Capital
Securities the following payments (the "Guarantee Payments," to the extent not
paid by the Issuer: (i) any accumulated and unpaid Distributions required to be
paid on the Series A Securities, to the extent that the Issuer has funds on hand
available therefor at such time, (ii) the redemption price with respect to any
Series A 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
Series A Subordinated Debentures are distributed to holders of the Series A
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
Series A Securities after payment of creditors of the Issuer as required by
applicable law. The Series A Guarantee will be qualified as an indenture under
the Trust Indenture Act. The Bank of New York will act as the Guarantee Trustee
for the purposes of compliance with the Trust Indenture Act and will hold the
Series A Guarantee for the benefit of the holders of the Series A
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Securities. The Bank of New York will also act as Debenture Trustee for the
Series A Subordinated Debentures and as Property Trustee.
The holders of not less than a majority in aggregate Liquidation Amount of
the Series A 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 Series A Guarantee or to direct the exercise of any trust power
conferred upon the Guarantee Trustee under the Series A Guarantee. Any holder of
the Series A Securities may institute a legal proceeding directly against the
Corporation to enforce its rights under the Series A 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 Series A Subordinated Debentures, the Series A
Issuer would lack funds for the payment of Distributions or amounts payable on
redemption of the Series A Securities or otherwise, and, in such event, holders
of the Series A Capital Securities would not be able to rely upon the Guarantee
for payment of such amounts. Instead, if an 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 on or principal of the Series A
Subordinated Debentures on the applicable payment date, then a holder of Series
A 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 on such Series A Subordinated Debentures having
a principal amount equal to the aggregate Liquidation Amount of the Series A
Capital Securities of such holder. 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 Series A Capital
Securities in the Direct Action. Except as described herein, holders of Series A
Capital Securities will not be able to exercise directly any other remedy
available to the holders of the Series A Subordinated Debentures or assert
directly any other rights in respect of the Series A Subordinated Debentures.
The Series A Trust Agreement provides that each holder of Series A Securities by
acceptance thereof agrees to the provisions of the Series A Guarantee and the
Indenture.
If the Corporation does not make interest payments on the Series A
Subordinated Debentures held by the Issuer, the Issuer will not be able to pay
Distributions on the Series A Capital Securities and will not have funds legally
available therefor. The Series A 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 Series A Guarantee 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. The Series A Guarantee 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.
The Corporation has, through the Series A Guarantee, the Series A Trust
Agreement, the Series A Subordinated Debentures and the Indenture, taken
together, fully, irrevocably and unconditionally guaranteed all of the Issuer's
obligations under the Series A 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 Series A Capital Securities. See
"Relationship Among the Capital Securities, the Corresponding Junior
Subordinated Debentures and the Guarantee."
STATUS OF THE GUARANTEE
The Series A 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 the Series A Subordinated
Debentures.
The Series A Guarantee will rank pari passu with all other Guarantees
issued by the Corporation. The Series A Guarantee will constitute a guarantee of
payment and not of collection (i.e. the guaranteed party may institute a legal
proceeding directly against the Guarantor to enforce its rights under the Series
A Guarantee without first instituting a legal proceeding against any other
person or entity). The Series A Guarantee will be
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held for the benefit of the holders of the Series A Trust Securities. The Series
A 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 Series A Trust Securities of the Series A Subordinated Debentures. The
Series A Guarantee 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.
AMENDMENTS AND ASSIGNMENTS
Except with respect to any changes which do not materially adversely affect
the rights of holders of the Series A Trust Securities (in which case no vote
will be required), the Series A Guarantee may not be amended without the prior
approval of the holders of not less than a majority of the aggregate Liquidation
Amount of such outstanding Series A Trust Securities. The manner of obtaining
any such approval will be as set forth under "Description of Capital
Securities -- Voting Rights; Amendment of Series A Trust Agreement." All
guarantees and agreements contained in the Series A Guarantee shall bind the
successors, assigns, receivers, trustees and representatives of the Corporation
and shall inure to the benefit of the holders of the Series A Trust Securities
then outstanding.
EVENTS OF DEFAULT
An event of default under the Series A Guarantee will occur upon the
failure of the Corporation to perform any of its payment or other obligations
thereunder. The holders of not less than a majority in aggregate Liquidation
Amount of the Series A Trust 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 Series A Guarantee or to direct the exercise
of any trust or power conferred upon the Guarantee Trustee under the Series A
Guarantee.
Any holder of Series A Trust 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.
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 Series A Guarantee,
undertakes to perform only such duties as are specifically set forth in the
Series A Guarantee and, after default with respect to the Series A 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 Series A Guarantee at the request of any holder of
Series A Trust Securities unless it is offered reasonable indemnity against the
costs, expenses and liabilities that might be incurred thereby.
TERMINATION OF THE GUARANTEE
The Series A Guarantee will terminate and be of no further force and effect
upon full payment of the Redemption Price of the Series A Trust Securities, upon
full payment of the amounts payable upon liquidation of the Issuer or upon
distribution of Series A Subordinated Debentures to the holders of the Series A
Trust Securities in exchange therefor. The Series A Guarantee will continue to
be effective or will be reinstated, as the case may be, if at any time any
holder of the Series A Trust Securities must restore payment of any sums paid
under such Series A Trust Securities or such Guarantee.
GOVERNING LAW
The Series A Guarantee will be governed by and construed in accordance with
the laws of the State of New York.
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RELATIONSHIP AMONG THE SERIES A CAPITAL SECURITIES,
THE SERIES A SUBORDINATED DEBENTURES
AND THE SERIES A GUARANTEE
FULL AND UNCONDITIONAL GUARANTEE
Payments of Distributions and other amounts due on the Series A Capital
Securities (to the extent the Issuer has funds available for the payment of such
Distributions and other amounts) are irrevocably guaranteed by the Corporation
as and to the extent set forth under "Description of Series A Guarantee." Taken
together, the Corporation's obligations under the Series A Subordinated
Debentures, the Indenture, and the Series A Trust Agreement and the Series A
Guarantee provide, in the aggregate, a full, irrevocable and unconditional
guarantee of payments of Distributions and other amounts due on the Series A
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 Series A Capital Securities. If and to the extent
that the Corporation does not make payments on the Series A Subordinated
Debentures, the Issuer will not pay Distributions or other amounts due on the
Series A Preferred Securities. The Series A Guarantee does not cover payment of
Distributions when the Issuer does not have sufficient funds to pay such
Distributions. In such event, the remedy of a holder of a Series A 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
equal to such Distributions to such holder. The obligations of the Corporation
under the Series A Guarantee is 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 the
Series A Subordinated Debentures, such payments will be sufficient to cover
Distributions and other payments due on the Series A Capital Securities,
primarily because (i) the aggregate principal amount of the Series A
Subordinated Debentures will be equal to the sum of the aggregate stated
Liquidation Amount of the Series A Capital Securities and Common Securities;
(ii) the interest rate and interest and other payment dates on Series A
Subordinated Debentures will match the Distribution rate and Distribution and
other payment dates for the Series A Capital Securities; (iii) the Corporation
shall pay for all and any costs, expenses and liabilities of the Issuer except
the Issuer's obligations to holders of the Series A Capital Securities under the
Series A Capital Securities; and (iv) the Series A Trust Agreement further
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 Series A Guarantee.
ENFORCEMENT RIGHTS OF HOLDERS OF SERIES A CAPITAL SECURITIES
A holder of any Series A Capital Security may institute a legal proceeding
directly against the Corporation to enforce its rights under the Series A
Guarantee without first instituting a legal proceeding against the Guarantee
Trustee, the 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 Series A 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 Series A Subordinated
Debentures would constitute an Event of Default under the Indenture.
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LIMITED PURPOSE OF ISSUER
The Series A Capital Securities evidence a beneficial interest in the
Issuer, and the Issuer exists for the sole purpose of issuing the Series A
Capital Securities and Common Securities and investing the proceeds thereof in
Series A Subordinated Debentures. A principal difference between the rights of a
holder of Series A Capital Securities and a holder of a Series A Subordinated
Debenture is that a holder of a Series A Subordinated Debenture is entitled to
receive from the Corporation the principal amount of and interest accrued on
Series A Subordinated Debentures held, while a holder of Series A Capital
Securities is entitled to receive Distributions from such Issuer (or from the
Corporation under the Series A 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
the Issuer involving the liquidation of the Series A Subordinated Debentures,
after satisfaction of liabilities to creditors of the Issuer as required by
applicable law, the holders of the Series A Capital Securities will be entitled
to receive, out of the assets held by such Issuer, the Liquidation Distribution
in cash. See "Description of the Series A Capital Securities -- Liquidation
Distribution Upon Termination." Upon any voluntary or involuntary liquidation or
bankruptcy of the Corporation, the Property Trustee, as holder of the Series A
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 shareholders of the Corporation receive payments or distributions.
Because the Corporation is the guarantor under the Series A 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 the Series A Capital Securities), the
positions of a holder of Series A Capital Securities and a holder of the Series
A Subordinated Debentures relative to other creditors and to shareholders of the
Corporation in the event of liquidation or bankruptcy of the Corporation are
expected to be substantially the same.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
GENERAL
In the opinion of Stevens & Lee, special tax counsel to the Corporation and
the Issuer ("Tax Counsel"), the following summary accurately describes the
material United States federal income tax consequences that may be relevant to
the purchase, ownership and disposition of Series A Capital Securities. Unless
otherwise stated, this summary deals only with Series A Capital Securities held
as capital assets by United States Persons (defined below) who purchase the
Series A Capital Securities upon original issuance at their original offering
price. As used herein, a "United States Person" means a person that is (i) a
citizen or resident of the United States, (ii) a corporation, partnership or
other entity created or organized in or under the laws of the United States or
any political subdivision thereof, (iii) an estate the income of which is
subject to United States federal income taxation regardless of its source, or
(iv) any trust if a court within the United States is able to exercise primary
supervision over the administration of such trust and one or more United States
Persons have the authority to control all substantial decisions of such trust.
The tax treatment of a holder may vary depending on his, her or its particular
situation. This summary does not address all the tax consequences that may be
relevant to a particular holder or to holders who may be subject to special tax
treatment, such as banks, real estate investment trusts, regulated investment
companies, insurance companies, dealers in securities or currencies, tax-exempt
investors, or foreign investors. In addition, this summary does not include any
description of any alternative minimum tax consequences or the tax laws of any
state, local or foreign government that may be applicable to a holder of Series
A Capital Securities. This summary is based on the Internal Revenue Code of
1986, as amended (the "Code"), the Treasury regulations promulgated thereunder
and administrative and judicial interpretations thereof, as of the date hereof,
all of which are subject to change, possibly on a retroactive basis.
The authorities on which this summary is based are subject to various
interpretations and the opinions of Tax Counsel are not binding on the Internal
Revenue Service ("IRS") or the courts, either of which could take a contrary
position. Moreover, no rulings have been or will be sought from the IRS with
respect to the
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transactions described herein. Accordingly, there can be no assurance that the
IRS will not challenge the opinions expressed herein or that a court would not
sustain such a challenge. Nevertheless, Tax Counsel has advised that it is of
the view that, if challenged, the opinions expressed herein would be sustained
by a court with jurisdiction in a properly presented case.
HOLDERS SHOULD CONSULT THEIR OWN TAX ADVISORS WITH RESPECT TO THE TAX
CONSEQUENCES TO THEM OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF THE SERIES A
CAPITAL SECURITIES, INCLUDING THE TAX CONSEQUENCES UNDER UNITED STATES FEDERAL,
STATE, LOCAL, FOREIGN, AND OTHER TAX LAWS AND THE POSSIBLE EFFECTS OF CHANGES IN
UNITED STATES FEDERAL OR OTHER TAX LAWS. FOR A DISCUSSION OF THE POSSIBLE
REDEMPTION OF THE SERIES A CAPITAL SECURITIES UPON THE OCCURRENCE OF CERTAIN TAX
EVENTS SEE "DESCRIPTION OF THE SERIES A CAPITAL SECURITIES -- REDEMPTION."
CLASSIFICATION OF THE ISSUER
In connection with the issuance of the Series A Capital Securities, Tax
Counsel is of the opinion that, under current law and assuming compliance with
the terms of the Series A Trust Agreement, and based on certain facts and
assumptions contained in such opinion, the Issuer will be classified as a
grantor trust and not as an association taxable as a corporation for United
States federal income tax purposes. As a result, each beneficial owner of Series
A Capital Securities (a "Securityholder") will be treated as owning an undivided
beneficial interest in the Series A Subordinated Debentures. Accordingly, each
Securityholder will be required to include in its gross income its pro rata
share of the interest income or original issue discount that is paid or accrued
on the Series A Subordinated Debentures. See "-- Interest Income and Original
Issue Discount."
CLASSIFICATION OF THE SERIES A SUBORDINATED DEBENTURES
The Corporation, the Issuer and the holders of the Series A Securities (by
acceptance of a beneficial interest in a Series A Security) will agree to treat
the Series A Subordinated Debentures as indebtedness for all United States tax
purposes. In connection with the issuance of the Series A Subordinated
Debentures, Tax Counsel is of the opinion that, under current law, and based on
certain representations, facts and assumptions set forth in such opinion, the
Series A Subordinated Debentures will be classified as indebtedness for United
States federal income tax purposes. No assurance can be given, however, that the
IRS will not challenge such position or, if challenged, that such a challenge
will not be successful. The remainder of this discussion assumes that the Series
A Subordinated Debentures will be treated as indebtedness of the Corporation for
United States federal income tax purposes.
INTEREST INCOME AND ORIGINAL ISSUE DISCOUNT
Under applicable Treasury regulations, the Series A Subordinated Debentures
will not be considered to have been issued with "original issue discount"
("OID") within the meaning of Section 1273(a) of the Code. Accordingly, except
as set forth below, stated interest on the Series A Subordinated Debentures
generally will be included in income by a Securityholder at the time such
interest income is paid or accrued in accordance with such Securityholder's
regular method of tax accounting.
If, however, the Corporation exercises its right to defer payments of
interest on the Series A Subordinated Debentures, the Series A Subordinated
Debentures will become OID instruments at such time and all Securityholders will
be required to accrue the stated interest on the Series A Subordinated
Debentures on a daily basis during the Extension Period, even though the
Corporation will not pay such interest until the end of the Extension Period,
and even though some Securityholders may use the cash method of tax accounting.
Moreover, thereafter the Series A Subordinated Debentures will be taxed as OID
instruments for as long as they remain outstanding. Thus, even after the end of
the Extension Period, all Securityholders would be required to continue to
include the stated interest on the Series A Subordinated Debentures in income on
a daily economic accrual basis, regardless of their method of tax accounting and
in advance of receipt of the cash attributable to such interest income. Under
the OID economic accrual rules, a Securityholder would accrue an amount of
interest income each year that approximates the stated interest payments called
for under the terms of the Series A Subordinated Debentures, and actual cash
payments of interest on the Series A Subordinated Debentures would not be
reported separately as taxable income. Any amount of OID included
46
<PAGE> 48
in a Securityholder's gross income (whether or not during an Extension Period)
will increase such Securityholder's tax basis in its Series A Capital
Securities, and the amount of Distributions received by a Securityholder with
respect to such Series A Capital Securities will reduce the tax basis of such
Series A Capital Securities.
The Treasury regulations described above have not yet been addressed in any
rulings or other interpretations by the IRS, and it is possible that the IRS
could take a contrary position. If the IRS were to assert successfully that the
stated interest on the Series A Subordinated Debentures was OID regardless of
whether the Corporation exercises its right to defer payments of interest on
such debentures, all Securityholders would be required to include such stated
interest in income on a daily economic accrual basis as described above.
Corporate Securityholders will not be entitled to a dividends-received
deduction with respect to any income recognized with respect to the Series A
Capital Securities.
DISTRIBUTION OF SERIES A SUBORDINATED DEBENTURES TO HOLDERS OF SERIES A CAPITAL
SECURITIES
Under current law, a distribution by the Issuer of the Series A
Subordinated Debentures as described under the caption "Description of the
Series A Capital Securities -- Liquidation of Issuer and Distribution of Series
A Subordinated Debentures to Holders" will be non-taxable and will result in the
Securityholder receiving directly its pro rata share of the Series A
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 Securityholder had in its Series A 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 Series A Subordinated Debentures as a result of a Tax
Event or otherwise, the distribution of Series A Subordinated Debentures to
Securityholders by the Issuer could be a taxable event to the Issuer and each
Securityholder, and a Securityholder would recognize gain or loss as if the
Securityholder had exchanged its Series A Capital Securities for the Series A
Subordinated Debentures it received upon the liquidation of the Issuer. A
Securityholder will accrue interest in respect of Series A Subordinated
Debentures received from the Issuer in the manner described above under
"-- Interest Income and Original Issue Discount."
SALES OR REDEMPTION OF SERIES A CAPITAL SECURITIES
Gain or loss will be recognized by a Securityholder on a sale of Series A
Capital Securities (including a redemption for cash) in an amount equal to the
difference between the amount realized by the Securityholder on the sale or
redemption of the Series A Capital Securities (except to the extent that such
amount realized is characterized as a payment in respect of accrued but unpaid
interest on such Securityholder's allocable share of the Series A Subordinated
Debentures that such Securityholder had not included in income previously) and
the Securityholder's adjusted tax basis in the Series A Capital Securities sold
or redeemed. Such gain or loss generally will be taxable as long-term capital
gain or loss if the Securityholder held the Series A Capital Securities that it
sold or redeemed for more than one year. Capital gains of individuals derived
with respect to capital assets held for more than one year are eligible for
reduced rates of taxation depending upon the holding period of such capital
assets. Securityholders should consult their own tax advisors regarding capital
gains rates applicable to them. Subject to certain limited exceptions, capital
losses cannot be applied to offset ordinary income for federal income tax
purposes.
NON-UNITED STATES HOLDERS
As used herein, the term "Non-United States Holder" means any
Securityholder that is not a United States Person. As discussed above, the
Series A Capital Securities will be treated as evidence of an indirect
beneficial ownership interest in the Series A Subordinated Debentures. See
"-- Classification of the Trust." Thus, under present United States federal
income tax law, and subject to the discussion below concerning backup
withholding:
(a) no withholding of United States federal income tax will be
required with respect to the payment by the Issuer (or the Corporation) or
any paying agent of principal or interest (which for purposes of this
discussion includes any OID) on the Series A Capital Securities (or the
Series A Subordinated
47
<PAGE> 49
Debentures) to a Non-United States Holder, provided (i) that such
Non-United States Holder does not actually or constructively own 10% or
more of the total combined voting power of all classes of stock of the
Corporation entitled to vote within the meaning of section 871(h)(3) of the
Code and the regulations thereunder, (ii) such Non-United States Holder is
not a controlled foreign corporation that is related to the Corporation
through stock ownership, (iii) such Non-United States Holder is not a bank
whose receipt of interest on the Series A Subordinated Debentures is
described in section 881(c)(3)(A) of the Code and (iv) such Non-United
States Holder satisfies the statement requirement (described generally
below) set forth in section 871(h) and section 881(c) of the Code and the
regulations thereunder; and
(b) no withholding of United States federal income tax will be
required with respect to any gain realized by a Non-United States Holder
upon the sale or other disposition of the Series A Capital Securities (or
the Series A Subordinated Debentures).
To satisfy the requirement referred to in (a)(iv) above, the Non-United
States Holder, or a financial institution holding the Series A Capital
Securities on behalf of such owner, must provide, in accordance with specified
procedures, to the Issuer or its paying agent, a statement to the effect that
the Non-United States Holder is not a United States Person. Currently, these
requirements will be met if (1) the Non-United States Holder provides his name
and address, and certifies, under penalties of perjury, that it is not a United
States Person (which certification may be made on an IRS Form W-8 (or successor
form)) or (2) a financial institution holding the Series A Capital Securities on
behalf of the Non-United States Holder certifies, under penalties of perjury,
that such statement has been received by it and furnishes the Issuer or the
paying agent with a copy thereof. Under recently finalized Treasury regulations
(the "Final Regulations"), the statement requirement referred to in (a)(iv)
above may also be satisfied with other documentary evidence for interest paid
after December 31, 1999 with respect to an offshore account or through certain
foreign intermediaries.
If a Non-United States Holder cannot satisfy the requirements of the
"portfolio interest" exception described in (a) above, payments of interest made
to such Non-United States Holder will be subject to a 30% United States federal
withholding tax unless the Beneficial Owner provides the Issuer or its paying
agent, as the case may be, with a properly executed (1) IRS Form 1001 (or a
successor form) claiming an exemption from, or a reduction of, such withholding
tax under the benefit of a tax treaty or (2) IRS Form 4224 (or a successor form)
stating that interest paid on the Series A Capital Securities (or the Series A
Subordinated Debentures) is not subject to such withholding tax because it is
effectively connected with the Beneficial Owner's conduct of a trade or business
in the United States. Under the Final Regulations, Non-United States Holders
generally will be required to provide an IRS Form W-8 in lieu of an IRS Form
1001 or an IRS Form 4224, although alternative documentation may be applicable
in certain situations and certain forms and statements in effect on certain
dates during the transition period described in Notice 98-16, I.R.B. 1998-15
(March 27, 1998), may expire and become ineffective, thus requiring the filing
of new replacement certificates or statements.
If a Non-United States Holder is engaged in a trade or business in the
United States and interest on the Series A Capital Securities (or the Series A
Subordinated Debentures) is effectively connected with the conduct of such trade
or business, the Non-United States Holder, although exempt from the withholding
tax discussed above, will be subject to United States federal income tax on such
interest on a net income basis in the same manner as if it were a United States
Person. In addition, if such Non-United States Holder is a foreign corporation,
it may be subject to a branch profits tax equal to 30% of its effectively
connected earnings and profits for the taxable year, subject to adjustments. For
this purpose, such interest income would be included in such foreign
corporation's earnings and profits. Under the Final Regulations, Non-United
States Holders will generally be required to provide IRS Form W-8 in lieu of IRS
Form 1001 and IRS Form 4224, although alternative documentation may be
applicable in certain situations and certain forms and statements in effect on
certain dates during the transition period described in Notice 98-16 may expire
and become ineffective, thus requiring the filing of new replacement
certificates or statements.
Any gain realized upon the sale or other disposition of the Series A
Capital Securities (or the Series A Subordinated Debentures) generally will not
be subject to United States federal income tax unless (i) such gain is
effectively connected with a United States trade or business of the Non-United
States Holder, (ii) in the case of a Non-United States Holder who is an
individual, such individual is present in the United States for 183 days or more
in the taxable year of such sale, exchange or retirement, and certain other
conditions are
48
<PAGE> 50
met, or (iii) in the case of any gain representing accrued interest on the
Series A Subordinated Debentures, the requirements described above are not
satisfied.
HOLDERS SHOULD CONSULT NOTICE 98-16 AND THEIR OWN TAX ADVISORS ABOUT THE
NEW RULES CONCERNING BACKUP WITHHOLDING ON NON-UNITED STATES HOLDERS AND THE
RELATED TRANSITION RULES.
BACKUP WITHHOLDING TAX AND INFORMATION REPORTING
The amount of OID accrued on the Series A Capital Securities held of record
by United States Persons (other than corporations and other exempt
Securityholders), if any, will be reported to the IRS. "Backup" withholding at a
rate of 31% will apply to payments of interest to non-exempt United States
Persons unless the Securityholder 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.
Payment of the proceeds from the disposition of Series A 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 Securityholder under the backup withholding
rules will be allowed as a refund or a credit against such Securityholder's
United States federal income tax liability, provided the required information is
furnished to the IRS.
It is anticipated that income on the Series A Capital Securities will be
reported to holders on Form 1099 and mailed to holders of the Series A Capital
Securities by January 31 following each calendar year.
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 Series A 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)(4) of ERISA) are
not subject to the requirements of ERISA or Section 4975 of the Code; however,
governmental plans may be subject to similar provisions under applicable state
laws.
Under a regulation (the "Plan Assets Regulation") issued by the U.S.
Department of Labor (the "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 an equity interest in the Issuer
and no exception were applicable under the Plan Assets Regulation. An "equity
interest" is defined under the Plan Assets Regulation as any interest in an
entity other than an instrument which is treated as indebtedness under
applicable local law and which has no substantial equity features and
specifically includes a beneficial interest in a trust.
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, at all times, less than 25% of the value of each class of equity interests
in the Issuer 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"), or if the Series A Capital Securities
were
49
<PAGE> 51
"publicly-offered securities" for purposes of the Plan Assets Regulation. No
assurance can be given that the Series A Capital Securities held by Benefit Plan
Investors will be less than 25% of the total value of such Series A Capital
Securities 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. In addition, no assurance can be given that
the Series A Capital Securities would be considered to be "publicly-offered
securities" under the Plan Assets Regulation. All of the Series A Common
Securities will be purchased and initially 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 Series A Capital Securities were acquired
with "plan assets" of such Plan and the assets of the Issuer were deemed to be
"plan assets" of Plans investing in the Issuer. For example, if the Corporation
were a Party in Interest with respect to a Plan (either directly or by reason of
its ownership of the Bank or other subsidiaries), extensions of credit between
the Corporation and the Issuer (as represented by the Series A Subordinated
Debentures and the Series A 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).
In addition, if the Corporation were considered to be a fiduciary with respect
to the Issuer as a result of certain powers it holds (such as the powers to
remove and replace the Property Trustee and the Administrative Trustees), it is
possible that the optional redemption or acceleration of the Series A
Subordinated Debentures would be considered to be prohibited transactions under
Section 406(b) of ERISA and Section 4975(c)(1)(E) of the Code. IN AN ATTEMPT TO
AVOID SUCH PROHIBITED TRANSACTIONS, EACH INVESTING PLAN, BY PURCHASING SERIES A
CAPITAL SECURITIES, WILL BE DEEMED TO HAVE DIRECTED THE ISSUER TO INVEST IN THE
SERIES A SUBORDINATED DEBENTURES AND TO HAVE APPOINTED THE PROPERTY TRUSTEE.
The DOL has issued five prohibited transaction class exemptions ("PTCEs")
that may provide exemptive relief if required for direct or indirect prohibited
transactions that may arise from the purchase or holding of the Series A Capital
Securities. 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 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).
Because the Series A Capital Securities may be deemed to be equity
interests in the Issuer for purposes of applying ERISA and Section 4975 of the
Code, the Series A 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 or
another applicable exemption. Any purchaser or holder of the Series A 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 or another applicable exemption with respect
to such purchase or holding. If a purchaser or holder of the Series A Capital
Securities that is a Plan or a Plan Asset Entity elects to rely on an exemption
other than PTCE 96-23, 95-60, 91-38, 90-1 or 84-14, the Corporation and the
Issuer may require a satisfactory opinion of counsel or other evidence with
respect to the availability of such exemption for such purchase and 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 Series A
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
were deemed to be "plan assets" and the availability of exemptive relief under
PTCE 96-23, 95-60, 91-38, 90-1 or 84-14 or any other applicable exemption.
50
<PAGE> 52
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting Agreement
dated April , 1998 (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 has severally agreed to purchase from the
Issuer, the respective number of Series A Capital Securities set forth opposite
its name below:
<TABLE>
<CAPTION>
NUMBER OF SERIES A CAPITAL SECURITIES
-------------------------------------
<S> <C>
CIBC Oppenheimer Corp. ........................
Legg Mason Wood Walker, Incorporated...........
---------
Total................................ 1,200,000
=========
</TABLE>
Under the terms and conditions of the Underwriting Agreement, the
Underwriters are committed to take and pay for all of the Series A Capital
Securities if any are taken.
The Underwriters propose initially to offer the Series A Capital Securities
in part directly to the public at the initial public offering price set forth on
the cover page of this Prospectus and in part to certain securities dealers at
such price less a concession not in excess of $ per Series A Capital Security.
The Underwriters may allow, and such dealers may reallow, a concession not to
exceed $ per Series A Capital Security to certain brokers and dealers. After
the Series A Capital Securities are released for sale to the public, the initial
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 Series A Capital
Securities will be used to purchase the Series A Subordinated Debentures issued
by the Corporation, the Underwriting Agreement provides that the Corporation
will pay as Underwriters' compensation for the Underwriters' arranging the
investment in such Series A Subordinated Debentures of such proceeds an amount
of $ per Series A Capital Security for the accounts of the several
Underwriters.
The Issuer has granted to the Underwriters an option, exercisable for 30
days from the date of this Prospectus, to purchase up to an additional 180,000
Series A Capital Securities at the public offering price set forth on the cover
page hereof less underwriting discounts. The Underwriters may exercise such
option to purchase additional Series A Capital Securities solely for the purpose
of covering over-allotments, if any, incurred in the sale of the Series A
Capital Securities.
To the extent that the Underwriters exercise their option to purchase
additional Series A Capital Securities, the Issuer will issue and sell to the
Company additional Series A Capital Securities and the Company will issue and
sell to the Issuer Series A Junior Subordinated Debentures in an aggregate
principal amount equal to the total Liquidation Amount of the additional Series
A Capital Securities being purchased pursuant to the option and the additional
Series A Capital Securities.
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
Series A Capital Securities, as determined by the Underwriters, and (ii) the
closing date, they will not offer, sell, contract to sell or otherwise dispose
of, 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 Series A Capital Securities, including any
guarantee of such securities, or any securities convertible into or exchangeable
for or representing the right to receive 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 Series A
Capital Securities offered in connection with this offering.
Prior to this offering, there has been no public market for the Series A
Capital Securities. Although the Underwriters have indicated to the Corporation
and the Issuer that they intend to make a market in the Series A Capital
Securities, they are not obligated to do so and may discontinue any such
market-making activities at any time without notice. No assurance can be given
as to the liquidity of the trading markets for the Series A Capital Securities.
51
<PAGE> 53
The Corporation and the Issuer have agreed to indemnify the several
Underwriters against certain liabilities, including liabilities under the Act.
It is expected that delivery of the Series A Capital Securities will be
made against payment therefor on or about April , 1998, as agreed upon by the
Corporation, the Issuer and the Underwriters in accordance with Rule 15c6-1
under the Exchange Act.
Certain of the Underwriters or their affiliates have provided from time to
time, and expect to provide in the future, investment services to the
Corporation and its affiliates, for which such Underwriters or their affiliates
have received or will receive customary fees and commissions.
In connection with this offering, certain Underwriters and selling group
members and their respective affiliates may engage in transactions that
stabilize, maintain or otherwise affect the market price of the Series A Capital
Securities. Such transactions may include stabilization transactions effected in
accordance with Rule 104 of Regulation M under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), pursuant to which such persons may bid
for or purchase Series A Capital Securities for the purpose of stabilizing the
market price for Series A Capital Securities. The Underwriters also may create a
short position for the account of the Underwriters by selling more Series A
Capital Securities in connection with the offering than they are committed to
purchase from the Issuer, and in such case may purchase Series A Capital
Securities in the open market following completion of the offering to cover all
or a portion of the Series A Capital Securities or by exercising the
Underwriters' overallotment option referred to above. In addition, CIBC
Oppenheimer Corp., on behalf of the Underwriters, may impose "penalty bids"
under contractual arrangements with the Underwriters whereby it may reclaim from
an Underwriter (or dealer participating in the offering) for the account of the
other Underwriters, the selling concession with respect to Series A Capital
Securities that is distributed in the offering but subsequently purchased for
the account of the Underwriters in the open market. Any of the transactions
described in this paragraph may result in the maintenance of the price of the
Series A Capital Securities at a level above that which might otherwise prevail
in the open market. None of the transactions described in this paragraph is
required, and, if they are undertaken, they may be discontinued at any time.
VALIDITY OF SECURITIES
Certain matters of Delaware law relating to the validity of the Series A
Capital Securities, the enforceability of the Series A Trust Agreement and the
formation of the Issuer will be passed upon by Richards, Layton & Finger,
special Delaware counsel to the Corporation and the Issuer. The validity of the
Series A Guarantee and the Series A Subordinated Debentures will be passed upon
for the Corporation by Stevens & Lee and for the Underwriters by Simpson Thacher
& Bartlett. Stevens & Lee and Simpson Thacher & Bartlett will rely on the
opinion of Richards, Layton & Finger as to matters of Delaware law. Certain
matters relating to United States federal income tax considerations described in
this Prospectus will be passed upon for the Corporation by Stevens & Lee.
EXPERTS
The consolidated financial statements of the Corporation incorporated by
reference in this prospectus and registration statement have been audited by
Arthur Andersen LLP, independent public accountants, as indicated in their
report with respect thereto, and is incorporated herein by reference in reliance
upon the authority of said firm as experts in accounting and auditing in giving
said report.
52
<PAGE> 54
======================================================
NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS IN CONNECTION WITH THE OFFER MADE
BY THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS
MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE CORPORATION, THE ISSUER
OR BY THE UNDERWRITERS. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER OR
SOLICITATION BY ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION
IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS
NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR
SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS, NOR ANY SALE MADE
HEREUNDER AND THEREUNDER, SHALL UNDER ANY CIRCUMSTANCES CREATE AN IMPLICATION
THAT THE INFORMATION HEREIN OR THEREIN IS CURRENT AS OF ANY TIME SUBSEQUENT TO
THE DATE HEREOF OR THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE
CORPORATION OR THE ISSUER SINCE THE DATE HEREOF.
---------------------------------
TABLE OF CONTENTS
<TABLE>
<S> <C>
PROSPECTUS
Available Information..................... 4
Incorporation of Certain Documents by
Reference............................... 4
Summary................................... 6
Risk Factors.............................. 9
USBANCORP Capital Trust I................. 14
USBANCORP, Inc............................ 14
Use of Proceeds........................... 16
Consolidated Ratios of Earnings to Fixed
Charges................................. 16
Capitalization............................ 17
Selected Consolidated Financial Data...... 18
Accounting Treatment...................... 19
Description of Series A Capital
Securities.............................. 20
Description of Series A Subordinated
Debentures.............................. 31
Book-Entry Issuance....................... 39
Description of Series A Guarantee......... 41
Relationship Among the Series A Capital
Securities, the Series A Subordinated
Debentures and the Series A Guarantee... 44
Certain Federal Income Tax Consequences... 45
Certain ERISA Considerations.............. 49
Underwriting.............................. 51
Validity of Securities.................... 52
Experts................................... 52
</TABLE>
======================================================
======================================================
USBANCORP CAPITAL
TRUST I
$30,000,000
BLUS(SM)
% BENEFICIAL UNSECURED SECURITIES,
SERIES A
(LIQUIDATION AMOUNT $25
PER CAPITAL SECURITY)
FULLY AND UNCONDITIONALLY GUARANTEED,
AS DESCRIBED HEREIN, BY
USBANCORP, INC.
[USBANCORP LOGO]
--------------------
PROSPECTUS
--------------------
CIBC OPPENHEIMER
LEGG MASON WOOD WALKER
INCORPORATED
April , 1998
======================================================
<PAGE> 55
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following expenses, other than the SEC registration fee, are estimated.
All expenses of this offering will be paid by the Company.
<TABLE>
<S> <C>
SEC registration fee........................................ $ 10,178
Trustee's fees.............................................. $ 6,000
Blue Sky fees and expenses.................................. 5,000
Transfer agent's and registrar's fees and expenses.......... 0
Printing and engraving expenses............................. 20,000
Accounting fees and expenses................................ 50,000
Legal fees and expenses (other than Blue Sky fees and
expenses)................................................. 150,000
Miscellaneous............................................... 8,822
--------
Total............................................. $250,000
========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Pennsylvania law provides that a Pennsylvania corporation may indemnify
directors, officers, employees, and agents of the corporation against
liabilities they may incur in such capacities for any action taken or any
failure to act, whether or not the corporation would have the power to indemnify
the person under any provision of law, unless such action or failure to act is
determined by a court to have constituted recklessness or willful misconduct.
Pennsylvania law also permits the adoption of a bylaw amendment, approved by
shareholders, providing for the elimination of a director's liability for
monetary damages for any action taken or any failure to take any action unless
(1) the director has breached or failed to perform the duties of his office and
(2) the breach or failure to perform constitutes self-dealing, willful
misconduct or recklessness.
The Bylaws of the Corporation provide for (1) indemnification of directors,
officers, employees, and agents of the Corporation and its subsidiaries and (2)
the elimination of a director's liability for monetary damages to the fullest
extent permitted by Pennsylvania law.
Directors and officers are also insured against certain liabilities for
their actions, as such, by an insurance policy obtained by the Corporation.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
<TABLE>
<CAPTION>
EXHIBIT
NO.
- -------
<C> <S>
1. Underwriting Agreement
4.1 Indenture of USBANCORP, Inc. relating to the Junior
Subordinated Debentures
4.2 Form of Certificate of Junior Subordinated Debentures
4.3 Certificate of Trust of USBANCORP Capital Trust I
4.4 Declaration of Trust of USBANCORP Capital Trust I
4.5 Amended and Restated Trust Agreement for USBANCORP Capital
Trust I
4.6 Form of Capital Security Certificate for USBANCORP Capital
Trust I
4.7 Form of Guarantee Agreement of USBANCORP, Inc. relating to
the Trust Securities
5.1 Opinion and consent of Stevens & Lee, P.C. to USBANCORP,
Inc. as to legality of the Junior Subordinated Debentures
and the Guarantee to be issued by USBANCORP, Inc.
5.2 Opinion of Richards, Layton & Finger, special Delaware
counsel, as to legality of the Capital Securities to be
issued by USBANCORP Capital Trust I
</TABLE>
II-1
<PAGE> 56
<TABLE>
<CAPTION>
EXHIBIT
NO.
- -------
<C> <S>
8 Opinion of Stevens & Lee, P.C., special tax counsel, as to
certain federal income tax matters
12.1 Computation of ratio of earnings to fixed charges (excluding
interest on deposits)
23.1 Consent of Arthur Andersen LLP
23.2 Consent of Stevens & Lee, P.C. (included in Exhibit 5.1)
23.3 Consent of Richards, Layton & Finger (included in Exhibit
5.2)
24 Power of Attorney of certain officers and directors of
USBANCORP, Inc.*
25.1 Form T-1 Statement of Eligibility of The Bank of New York to
act as trustee under the Amended and Restated Declaration of
Trust of USBANCORP Capital Trust I
25.2 Form T-1 Statement of Eligibility of The Bank of New York to
act as trustee under the Indenture
25.3 Form T-1 Statement of Eligibility of The Bank of New York to
act as trustee under the Exchange Guarantee for the benefit
of the holders of Capital Securities of USBANCORP Capital
Trust I
27.1 Financial Data Schedule.*
</TABLE>
- ---------------
* Previously filed.
ITEM 17. UNDERTAKINGS.
Each of the undersigned Registrants hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, as amended, each
filing of a Registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing
of an employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in this
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered herein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of each
undersigned Registrant pursuant to the foregoing provisions, or otherwise, each
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by each undersigned Registrant
of expenses incurred or paid by a director, officer of controlling person of
each Registrant in the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in connection with the
securities being registered, each Registrant will, unless in the opinion of its
counsel the matter has been settled by the controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Act and will be governed by the
final adjudication of such issue.
The undersigned Registrant hereby undertakes to provide to the Underwriters
at the closing specified in the Underwriting Agreement certificates in such
denominations and registered in such names as required by the Underwriters to
permit prompt delivery to each purchaser.
The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in
a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
II-2
<PAGE> 57
(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-3
<PAGE> 58
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, USBANCORP, Inc.
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing this Amendment No. 1 to 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 Johnstown, in the Commonwealth of
Pennsylvania, on the day of April 23, 1998.
USBANCORP, INC.
By: /s/ TERRY K. DUNKLE
------------------------------------
Terry K. Dunkle
Chairman, President and Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated on April 23, 1998.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ TERRY K. DUNKLE Chairman, President, and Chief April 23, 1998
- ----------------------------------------------------- Executive Officer
Terry K. Dunkle
/s/ JEROME M. ADAMS Director April 23, 1998
- -----------------------------------------------------
Jerome M. Adams
/s/ CLIFFORD A. BARTON Director April 23, 1998
- -----------------------------------------------------
Clifford A. Barton
/s/ MICHAEL F. BUTLER Director April 23, 1998
- -----------------------------------------------------
Michael F. Butler
/s/ JAMES C. DEWAR Director April 23, 1998
- -----------------------------------------------------
James C. Dewar
/s/ JAMES M. EDWARDS, SR. Director April 23, 1998
- -----------------------------------------------------
James M. Edwards, Sr.
Director April , 1998
- -----------------------------------------------------
Richard W. Kappel
</TABLE>
II-4
<PAGE> 59
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
Director April , 1998
- -----------------------------------------------------
John H. Kunkle, Jr.
/s/ ROBERT L. WISE Director April 23, 1998
- -----------------------------------------------------
Robert L. Wise
/s/ MARGARET A. O'MALLEY Director April 23, 1998
- -----------------------------------------------------
Margaret A. O'Malley
/s/ MARK E. PASQUERILLA Director April 23, 1998
- -----------------------------------------------------
Mark E. Pasquerilla
Director April , 1998
- -----------------------------------------------------
Jack Sevy
/s/ THOMAS C. SLATER Director April 23, 1998
- -----------------------------------------------------
Thomas C. Slater
Director April , 1998
- -----------------------------------------------------
James C. Spangler
/s/ JEFFREY A. STOPKO Senior Vice President and Chief April 23, 1998
- ----------------------------------------------------- Financial Officer (principal
Jeffrey A. Stopko financial and accounting
officer)
By: /s/ TERRY K. DUNKLE
- -----------------------------------------------------
Terry K. Dunkle
Attorney-in-fact
</TABLE>
Pursuant to the requirements of the Securities Act of 1933, USBANCORP
Capital Trust I certifies that it has reasonable grounds to believe that it
meets all the requirements for filing on Amendment No. 1 to 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 Johnstown, and
Commonwealth of Pennsylvania, on the 23rd day of April, 1998.
USBANCORP CAPITAL TRUST I
By: /s/ JEFFREY A. STOPKO
------------------------------------
Jeffrey A. Stopko
as Administrative Trustee
By: /s/ TERRY K. DUNKLE
------------------------------------
Terry K. Dunkle
as Administrative Trustee
By: /s/ ANTHONY M. V. ERAMO
------------------------------------
Anthony M. V. Eramo
as Administrative Trustee
II-5
<PAGE> 1
EXHIBIT 1
$30,000,000
USBANCORP Capital Trust I
BLUS (SM)
___% Beneficial Unsecured Securities, Series A
(Liquidation Amount $25 per Capital Security)
UNDERWRITING AGREEMENT
April ___, 1998
CIBC Oppenheimer Corp.
Legg Mason Wood Walker Incorporated
On behalf of the Several
Underwriters named in
Schedule I attached hereto.
c/o CIBC Oppenheimer Corp.
Oppenheimer Tower
World Financial Center
New York, New York 10281
Ladies and Gentlemen:
USBANCORP Capital Trust I (the "Trust"), a statutory business trust
created under the Business Trust Act (the "Delaware Act") of the State of
Delaware, and USBANCORP, a corporation organized under the laws of the
Commonwealth of Pennsylvania (the "Company"), propose to sell to you and the
other underwriters named in Schedule I to this Agreement (the "Underwriters"),
for whom you are acting as representatives (the "Representatives"), an aggregate
of shares (the "Firm Capital Securities") of its ___% Beneficial Unsecured
Securities, Series A (liquidation amount $25 per Capital Security) (the "Capital
Securities"). The Trust also proposes to grant to the Underwriters an option to
purchase up to an aggregate of additional Capital Securities (collectively,
the "Option Capital Securities") from the Trust solely for the purpose of
covering over-allotments in connection with the sole of the Firm Capital
Securities. The Firm Capital and the Option Capital Securities are together
called the "Capital Securities".
The Capital Securities will be guaranteed by (the "Company"), with
respect to distributions and amounts payable upon liquidation or redemption of
such Capital Securities (the "Guarantee") pursuant to the Guarantee Agreement
(the "Guarantee Agreement"), to be entered into between the Company and The Bank
of New York, as trustee (the "Guarantee Trustee"), for the benefit of holders
from time to time of the Capital Securities. The Company will be the owner of
all of the beneficial ownership interests represented by the common securities
(the "Common Securities") of the Trust. Proceeds from the sale of Capital
Securities to the Underwriters and from the concurrent sale of Common Securities
to the Company will be used to purchase approximately $30,900,000 aggregate
principal amount of ____% Junior Subordinated Deferrable Interest Debentures,
Series A due June 30, 2028 (the "Debentures") of the Company. The Debentures
will be issued by the Company pursuant to an Indenture (the "Indenture"), to be
entered into between the Company and The Bank of New York, as trustee (the
"Debenture Trustee"). This Agreement, the Indenture, the
<PAGE> 2
2
Declaration, and the Guarantee Agreement are referred to collectively as the
"Operative Documents."
1. Sale and Purchase of the Capital Securities.
On the basis of the representations, warranties and agreements
contained in, and subject to the terms and conditions of, this Agreement:
(a) The Trust and the Company agree to sell to each of the
Underwriters, and each of the Underwriters agrees, severally and not
jointly, to purchase the respective number of Capital Securities set forth
opposite the name of such Underwriter on Schedule I to this Agreement at a
purchase price of ___% of the liquidation amount thereof (the "Initial
Price").
(b) The Trust and the Company grant to the several Underwriters an
option to purchase, severally and not jointly, all or any part of the
Option Capital Securities at the Initial Price. The number of Option
Capital Securities to be purchased by each Underwriter shall be the same
percentage (adjusted by the Representatives to eliminate fractions) of the
total number of Option Capital Securities to be purchased by the
Underwriters as such Underwriter is purchasing of the Firm Capital
Securities. Such option may be exercised only to cover over-allotments in
the sales of the Firm Capital Securities by the Underwriters and may be
exercised in whole or in part at any time on or before 12:00 noon, New
York City time, on the business day before the Firm Closing Date (as
defined below), and only once thereafter within thirty days after the date
of this Agreement, in each case upon written or telegraphic notice, or
verbal or telephonic notice confirmed by written or telegraphic notice, by
the Representatives to the Trust no later than 12:00 noon, New York City
time, on the business day before the Firm Closing Date (as defined below)
or at least two business days before the Option Closing Date (as defined
below), as the case may be, setting forth the number of Option Capital
Securities to be purchased and the time and date (if other than the Firm
Closing Date (as defined below)) of such purchase.
2. Delivery and Payment. Delivery of the Firm Capital Securities to
the Representatives for the respective accounts of the Underwriters, and payment
of the purchase price by certified or official bank check or checks payable in
same day funds to the Trust, shall take place at the offices of CIBC Oppenheimer
Corp. at Oppenheimer Tower, World Financial Center, New York, New York 10281, at
10:00 a.m., New York City time, on the fifth business day following the date of
this Agreement, or at such time on such other date, not later than ten (10)
business days after the date of this Agreement, as shall be agreed upon by the
Trust and the Representatives (such time and date of delivery and payment are
called the "Firm Closing Date").
In the event the option with respect to the Optional Capital
Securities is exercised, delivery by the Trust of the Optional Capital
Securities to the Representatives for the respective accounts of the
Underwriters and payment of the purchase price by certified or official bank
check or checks payable in New York Clearing House (next day) funds to the Trust
shall take place at the offices of CIBC Oppenheimer Corp. specified above at the
time and on the date (which may be the same date as, but in no event shall be
earlier than, the Firm Closing Date) specified in the notice referred to in
Section 1(b) (such time and date of
<PAGE> 3
3
delivery and payment are called the "Optional Closing Date"). The Firm Closing
Date and the Optional Closing Date are called, individually, a "Closing Date"
and, together, the "Closing Dates."
Certificates evidencing the Capital Securities shall be registered
in such names and shall be in such denominations as the Representatives shall
request at least two (2) full business days before the Firm Closing Date or, in
the case of Optional Capital Securities, on the day of notice of exercise of the
option as described in Section l(b) and shall be made available to the
Representatives for checking and packaging, at such place as is designated by
the Representatives, on the full business day before the Firm Closing Date (or
the Optional Closing Date in the case of the Optional Capital Securities).
As compensation for the Underwriters' commitment and in view of the
fact that proceeds from the sale of Capital Securities to the Underwriters will
be used to purchase the Debentures, the Company shall pay, on the Firm Closing
Date or the Option Closing Date, as the case may be to the Underwriters a
commission of ___% of the liquidation amount of the Capital Securities purchased
by the Underwriters on such Closing Date by wire transfer to a bank account
designated by CIBC Oppenheimer Corp.
3. Registration Statement and Prospectus; Public Offering. The
Company and the Trust have prepared in conformity with the requirements of the
Securities Act of 1933, as amended (the "Securities Act"), and the published
rules and regulations thereunder (the "Rules") adopted by the Securities and
Exchange Commission (the "Commission") a registration statement on Form S-3 (No.
333-_____), including a preliminary prospectus relating to the Capital
Securities, and has filed with the Commission the Registration Statement (as
hereinafter defined) and such amendments thereof as may have been required to
the date of this Agreement. Such Registration Statement has been declared
effective by the Commission, and no further amendments thereto or supplements
thereof have been filled by the Company or the Trust with the Commission. Copies
of such Registration Statement (including all amendments thereof) and of the
related preliminary prospectus have heretofore been delivered by the Company and
the Trust to you. The term "Preliminary Prospectus" means any preliminary
prospectus (as described in Rule 430 of the Rules) included at any time as a
part of the Registration Statement. The Registration Statement as amended at the
time and on the date it became effective (the "Effective Date"), including all
exhibits and information, if any, deemed to be part of the Registration
Statement pursuant to Rule 424(b) and Rule 430A of the Rules, is called the
"Registration Statement." The term "Prospectus" means the prospectus in the form
first used to confirm sales of the Capital Securities (whether such prospectus
was included in the Registration Statement at the time of effectiveness or was
subsequently filed with the Commission pursuant to Rule 424(b) of the Rules).
Reference made herein to the Registration Statement, any Preliminary Prospectus
or the prospectus shall be deemed to refer to and include any documents
incorporated by reference therein pursuant to Item ___ of Form S-3 under the
Securities Act as of the date of such preliminary Prospectus or Prospectus, as
the case may be.
The Company and the Trust understands that the Underwriters propose
to make a public offering of the Firm Capital Securities and, to the extent
applicable, the Option Capital Securities, as set forth in and pursuant to the
Prospectus, as soon after the date of this Agreement as the Representatives deem
advisable. The Company hereby confirm that the Underwriters and dealers have
been authorized to distribute or cause to be distributed each preliminary
prospectus and are authorized to distribute the Prospectus (as from time to
<PAGE> 4
4
time amended or supplemented if the Company furnishes amendments or supplements
thereto to the Underwriters).
4. Representations and Warranties of the Trust and the Company. Each
of the Trust and the Company hereby, jointly and severally, represents and
warrants to, and agrees with, each Underwriter as follows:
(a) On the Effective Date the Registration Statement complied, and
on the date of the Prospectus, on the date any post-effective amendment to
the Registration Statement shall become effective, on the date any
supplement or amendment to the Prospectus is filed with the Commission and
on each Closing Date, the Registration Statement and the Prospectus (and
any amendment thereof or supplement thereto) will comply, in all material
respects, with the applicable provisions of the Securities Act and the
Rules and the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), and the rules and regulations of the Commission thereunder. The
Registration Statement did not, as of the Effective Date, contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the statements
therein not misleading; and on the other dates referred to above, neither
the Registration Statement nor the Prospectus, nor any amendment thereof
or supplement thereto, will contain any untrue statement of a material
fact or will omit to state any material fact required to be stated therein
or necessary in order to make the statements therein not misleading. When
any related preliminary prospectus was first filed with the Commission
(whether filed as part of the Registration Statement or any amendment
thereto or pursuant to Rule 424(a) of the Rules) and when any amendment
thereof or supplement thereto was first filed with the Commission, such
preliminary prospectus as amended or supplemented complied in all material
respects with the applicable provisions of the Securities Act and the
Rules and did not contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary in
order to make the statements therein not misleading. Notwithstanding the
foregoing, the Company and the Trust make no representation or warranty as
to the paragraph with respect to stabilization on the inside front cover
page of the Prospectus and the statements contained under the caption
"Underwriting" in the Prospectus. The Company and the Trust acknowledge
that the statements referred to in the previous sentence constitute the
only information furnished in writing by the Representatives on behalf of
the several Underwriters specifically for inclusion in the Registration
Statement, any preliminary prospectus or the Prospectus.
(b) The documents incorporated by reference in the Registration
Statement and the Prospectus, when they were wiled with the Commission,
conformed in all material respects to the requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), 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 made therein not misleading.
<PAGE> 5
5
(c) All contracts and other documents required to be filed as
exhibits to the Registration Statement have been filed with the Commission
as exhibits to the Registration Statement.
(d) The consolidated financial statements of the Company (including
all notes and schedules thereto) included in the Registration Statement
and Prospectus present fairly the financial condition, the results of
operations and cash flows and stockholders' equity and the other
information purported to be shown therein of the Company and its
subsidiaries (as defined in Section 12) at the respective dates and for
the respective periods to which they apply; and such financial statements
have been prepared in conformity with generally accepted accounting
principles, consistently applied throughout the periods involved, and all
adjustments (consisting only of normal recurring adjustments) necessary
for a fair presentation of the results for such periods have been made.
(e) Arthur Andersen LLP, whose reports are filed with the Commission
as a part of the Registration Statement are and, during the periods
covered by their reports, were independent public accountants as required
by the Securities Act and the Rules.
(f) The Company is duly registered as a bank holding company under
the Bank Holding Company Act of 1956, as amended (the "BHC Act"); the
Company and each of United national Bank in Johnstown, Three Rivers Bank
and Trust Company, Community Bancorp, Inc., Community Savings Bank and
USBANCORP Trust Company (collectively, the "Subsidiaries") have been duly
incorporated and are validly existing as corporations in good standing
under the laws of their respective jurisdictions of incorporation, are
qualified to do business and are in good standing as foreign corporations
in each jurisdiction in which their respective ownership or lease of
property or the conduct of their respective businesses requires such
qualification, and have all corporate power necessary to own or hold their
respective properties, to operate their branches and to conduct the
businesses in which they are engaged; and none of the subsidiaries of the
Company (other than each of the Subsidiaries) is a "significant
subsidiary", as such term is defined in Rule 405 of the Rules. The deposit
accounts of the Subsidiaries are insured by the Bank Insurance Fund of the
Federal Deposit Insurance Corporation ("FDIC") or the Savings Association
Insurance Fund of the FDIC to the fullest extent permitted by law and the
rules and regulations of the FDIC, and no proceedings for the termination
of such insurance are pending or threatened.
(g) The Company and each of the Subsidiaries owns, possesses or has
obtained all governmental licenses, permits, certificates, consents,
orders, approvals and other authorizations required under the laws of the
Commonwealth of Pennsylvania, the United States and any other jurisdiction
in which the Company or the Subsidiaries transact business in order to own
or lease, as the case may be, and to operate its properties and to conduct
its business as presently conducted and as described in the Prospectus;
all of such licenses, permits, certificates, consents, orders, approvals
and authorizations are in full force and effect and neither the Company
nor any of the Subsidiaries has received any notice of proceedings
relating to any revocation or modification thereof.
<PAGE> 6
6
(h) The Company and the Subsidiaries each have good and marketable
title in fee simple to all real property and good title to all personal
property owned by it, in each case free and clear of all liens,
encumbrances and defects except such as do not materially affect the value
of such property or do not materially interfere with the use made of such
property by the Company or such Subsidiary; and all real property and
buildings held under lease by the Company or any of the Subsidiaries are
held by them under valid, subsisting and enforceable leases, with such
exceptions as are not material and do not interfere with the use made of
such property and buildings by the Company or such Subsidiary.
(i) There is no action, suit, investigation or proceeding,
governmental or otherwise, pending or, to the Company's best knowledge,
threatened or contemplated (and the Company does not know of any basis
therefor) to which the Company or any of its Subsidiaries is or may be a
party or of which the business or property of the Company or any of its
Subsidiaries is or may be subject in either case that is material to the
Company and its Subsidiaries, taken as a whole, or which is required to be
disclosed in the Prospectus.
(j) Except as disclosed in or contemplated by the Registration
Statement and the Prospectus, subsequent to the respective dates as of
which information is given in the Registration Statement and the
Prospectus, there has not been any material adverse change in the
business, financial condition, management or results of operations of the
Company and its Subsidiaries whether or not arising from transactions in
the ordinary course of business, and neither the Company nor any of its
Subsidiaries has sustained any material loss or interference with its
assets, businesses or properties from fire, explosion, earthquake, flood
or other calamity, whether or not covered by insurance, or from any labor
dispute or any court or legislative or other governmental action, order or
decree.
(k) Except as may be disclosed in the Prospectus, the business of
the Company and the Subsidiaries has been conducted in all material
respects in compliance with all applicable laws, rules and regulations of
the Commonwealth of Pennsylvania, the United States and any other
jurisdiction in which the Company or any of the Subsidiaries transact
business, and of any regulatory agency or authority therein, which laws
are material to the operations of the Company. Neither the Company nor any
of the Subsidiaries is in violation in any material respect of any term or
provision of its charter or by-laws or other governing documents or of any
franchise, license, permit, judgment, decree, order, statute, rule,
regulation, directive, policy or guideline to which it or its property may
be subject, except for such violations which could not, individually or in
the aggregate, have a material adverse effect on the Company.
(l) No default exists, and no event has occurred which with notice
or lapse of time or both would constitute a default, in the due
performance and observance of any term, covenant or condition by the
Company or any of the Subsidiaries of any material agreement, indenture,
mortgage, deed of trust, note or any other material agreement or material
instrument to which the Company or any of the Subsidiaries is a party or
by which any of them or their respective properties or businesses may be
bound.
<PAGE> 7
7
(m) Neither the execution, delivery and performance of this
Agreement by the Company and the Trust nor the consummation of any of the
transactions contemplated hereby (including, without limitation, the
issuance by the Company of the Guarantee and the Debentures and the issue
by the Trust of the Capital Securities) will conflict with or result in
the breach or violation of any term or provision of, or constitute a
default (or an event which with notice or lapse of time or both would
constitute a default) under, or require any consent or waiver under, or
result in the creation or imposition of any lien, charge, claim,
encumbrance or security interest on any properties or assets of the
Company or any of the Subsidiaries pursuant to the terms of, any material
agreement, indenture, mortgage or other material agreement or material
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, nor will such actions violate the charter or by-laws or other
governing document of the Company or any of its Subsidiaries or any
applicable law, rule, regulation, decision, order or decree of any court
or governmental agency or governmental authority having jurisdiction over
the Company or any of its Subsidiaries or any of their properties, except
for such violations which will not have a material effect on the Company.
(n) No consent, approval, authorization or order of, or filing,
registration, or qualification with, any governmental agency or authority
is required in connection with the execution and delivery by the Company
of this Agreement or the consummation of the transactions contemplated
hereby (including without limitation the issuance by the Company of the
Guarantee and the debentures and the issue by the Trust of the Capital
Securities), except (A) as may be required under the Securities Act and
the Rules, the Exchange Act, or the Blue Sky laws of the various states of
the United States in connection with any sales of Capital Securities
therein or (B) as have already been obtained or made.
(o) There are no contracts or other documents which are required to
be described in the Prospectus or filed as exhibits to the Registration
Statement by the Securities Act or by the Rules which have not been
described in the Prospectus or filed as exhibits to the Registration
Statement or incorporated therein by reference as permitted by the Rules.
(p) The Company's capitalization is as set forth in the Prospectus;
all of the issued shares of capital stock of each of the Subsidiaries of
the Company have been duly and validly authorized and issued and are fully
paid and non-assessable and are owned by the Company, directly or
indirectly, free and clear of all liens, encumbrances, equities or claims
of any third parties; and no holder of any security of the Company has the
right to have any security owned by such holder included in the
Registration Statement or to require the Company to register any security
owned by such holder.
(q) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus, except as
described therein, (i) there has not been any material adverse change in
the assets or properties, business, results of operations, prospects or
condition (financial or otherwise), of the Company or any of its
Significant Subsidiaries, whether or not arising from transactions in the
ordinary course of business; (ii) neither the Company nor any of its
Significant Subsidiaries has
<PAGE> 8
8
sustained any material loss or interference with its assets, businesses or
properties (whether owned or leased) from fire, explosion, earthquake,
flood or other calamity, whether or not covered by insurance, or from any
labor dispute or any court or legislative or other governmental action,
order or decree; and (iii) and since the date of the latest balance sheet
included in the Registration Statement and the Prospectus, except as
reflected therein, neither the Company nor any of its Significant
Subsidiaries has (x) issued any securities or incurred any liability or
obligation, direct or contingent, for borrowed money, except such
liabilities or obligations incurred in the ordinary course of business,
(y) entered into any transaction not in the ordinary course of business,
or (z) declared or paid any dividend or made any distribution on any
shares of its respective stock or redeemed, purchased or otherwise
acquired or agreed to redeem, purchase or otherwise acquire any shares of
its respective stock.
(r) There is no document or contract of a character required to be
described in the Registration Statement or Prospectus or to be filed as an
exhibit to the Registration Statement which is not described or filed as
required. Each agreement listed in the Exhibits to the Registration
Statement is in full force and effect and is valid and enforceable by and
against the Company or the Trust, as the case may be, in accordance with
its terms, assuming the due authorization, execution and delivery thereof
by each of the other parties thereto. Neither the Trust, the Company, nor
to the best of the Company's knowledge, any other party, is in default in
the observance or performance of any term or obligation to be performed by
it under any such agreement, and no event has occurred which with notice
or lapse of time or both would constitute such a default, in any such case
which default or event would have a material adverse effect on the assets
or properties, business, results of operations, prospects or condition
(financial or otherwise) of the Company. No default exists, and no event
has occurred which with notice or lapse of time or both would constitute a
default, in the due performance and observance of any term, covenant or
condition, by the Trust or the Company, as the case may be, of any other
agreement or instrument to which the Trust or the Company, as the case may
be, is a party or by which it or its properties or business may be bound
or affected which default or event would have a material adverse effect on
the assets or properties, business, results of operations, prospects or
condition (financial or otherwise) of the Company.
(s) The Company is not in violation of any term or provision of its
charter or by-laws; the Trust is not in violation of its certificate of
Trust or Declaration; and neither the Trust, the Company nor any of the
Company's subsidiaries is in violation of any franchise, license, permit,
judgment, decree, order, statute, rule or regulation, where the
consequences of such violation would have a material adverse effect on the
assets or properties, business, results of operations, prospects or
condition (financial or otherwise) of the Company and its subsidiaries,
taken as a whole.
(t) Neither the execution, delivery and performance of the Operative
Documents by the Trust and the Company nor the consummation of any of the
transactions contemplated hereby (including, without limitation, the
issuance and sale by the Trust of the Capital Securities) will give rise
to a right to terminate or accelerate the due date of any payment due
under, or conflict with or result in the breach of any term or provision
of, or constitute a default (or an event which with notice or lapse of
time or both would constitute a default) under, or require any consent or
waiver under, or result in the execution or imposition of any lien, charge
<PAGE> 9
9
or encumbrance upon any properties or assets of the Trust, the Company or
any of the Company's Subsidiaries pursuant to the terms of, any indenture,
mortgage, deed of trust or other agreement or instrument to which the
Trust, the Company or any of the Company's Subsidiaries is a party or by
which it or any of its properties or businesses is bound, and no
franchise, license, permit, judgment, decree, order, statute, rule or
regulation applicable to the Trust, the Company or any of the Company's
Subsidiaries violate any provision of the charter or by-laws of the
Company or any of its Subsidiaries, the Trust Agreement or any statute or
any order, rule or regulation of any court or governmental agency or body
having jurisdiction over the Trust, the Company or any of the Company's
Subsidiaries or any of their properties or assets.
(u) The Capital Securities and the Common Securities have been duly
and validly authorized and, when issued and delivered against payment
therefor as provided herein, will be duly and validly issued, fully paid
and non-assessable; and the Capital Securities and the Common Securities,
when issued and delivered, will conform in all material respects to the
descriptions thereof contained in the Prospectus.
(v) The Indenture has been duly authorized, and when duly executed
by the proper officers of the Company (assuming due execution and delivery
by the Indenture Trustee) and delivered by the Company will constitute a
valid and binding agreement of the Company enforceable against the Company
in accordance with its terms, subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other
similar laws relating to or affecting creditors' rights generally, general
equitable principles (whether considered in a proceeding in equity or at
law) and an implied covenant of good faith and fair dealing; and the
Junior Subordinated Debentures have been duly authorized, and, when duly
executed, authenticated, issued and delivered as contemplated in the
Indenture, will constitute valid and binding obligations of the Company
entitled to the benefits of the Indenture and enforceable in accordance
with their terms, subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing; and the Junior
Subordinated Debentures, when issued and delivered, will conform in all
material respects to the description thereof contained in the Prospectus.
(w) The Trust has been duly created and is validly existing as a
statutory business trust in good standing under the Business Trust Act
with the trust power and authority to own property and conduct its
business as described in the Prospectus, and has conducted and will
conduct no business other than the transactions contemplated by this
Agreement as described in the Prospectus; the Trust is not a party to or
bound by any agreement or instrument other than this Agreement, the
Amended and Restated Trust Agreement (the "Trust Agreement") among the
Company, The Bank of New York, as property trustee (the "Property
Trustee"), The Bank of New York (Delaware), as Delaware trustee (the
"Delaware Trustee") and the individuals named therein as the Regular
Trustees (the "Regular Trustees", and together with the Property Trustee
and the Delaware Trustees, the "Trustees"), and the agreements and
instruments contemplated by the Declaration and described in the
<PAGE> 10
10
Prospectus; the Trust has no liabilities or obligations other than those
arising out of the transactions contemplated by this Agreement and the
agreements and instruments contemplated by the Declaration and described
in the Prospectus; and the Trust is not a party to or subject to any
action, suit or proceeding of any nature.
(x) The Trust Agreement has been duly authorized by the Company and,
when duly executed and delivered by the Company and the Trustees, will be
a valid and binding obligation of the Company, enforceable against the
Company in accordance with its terms, subject to the effects of
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium
and other similar laws relating to or affecting the rights of creditors
generally, general equitable principles (whether considered in a
proceeding in equity or at law) and an implied covenant of good faith and
fair dealing, and will conform in all material respects to the description
thereof contained in the Prospectus. Each of the Regular Trustees is an
employee of the Company and has been duly authorized by the Company to
serve in such capacity and to execute and deliver the Declaration.
(y) The Guarantee Agreement has been duly authorized and, when duly
executed and delivered by the proper officers of the Company and the
Guarantee Trustee, will constitute a valid and legally binding agreement
of the Company enforceable against the Company in accordance with its
terms, subject to the effects of bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other similar laws relating to
or affecting creditors' rights generally, general equitable principles
(whether considered in a proceeding in equity or at law) and an implied
covenant of good faith and fair dealing; and the Guarantee Agreement, when
executed and delivered, will conform in all material respects to the
description thereof contained in the Prospectus.
(z) This Agreement has been duly authorized, executed and delivered
by each of the Company and the Trust.
(aa) No transaction has occurred between or among the Company on the
one hand, and any of its officers or directors or any affiliate or
affiliates of any such officer or director on the other hand that is
required to be described in and is not described in the Registration
Statement and the Prospectus.
(ab) Neither the Trust, the Company nor any of the Company's
subsidiaries has taken, nor will they take, directly or indirectly, any
action designed to or which might reasonably be expected to cause or
result in, or which has constituted or which might reasonably be expected
to constitute, the stabilization or manipulation of the price of the
Capital Securities to facilitate the sale or resale of any of such Capital
Securities.
(ac) Neither the Trust nor the Company nor any subsidiary of the
Company is an "investment company" within the meaning of such term under
the Investment Company Act of 1940 and the rules and regulations of the
Commission thereunder.
5. Conditions of the Underwriters' Obligations. The obligations of
the Underwriters under this Agreement are several and not joint. The respective
obligations of
<PAGE> 11
11
the Underwriters to purchase the Capital Securities are subject to each of the
following terms and conditions:
(a) The Prospectus shall have been timely filed with the Commission
in accordance with Section 6(a)(i) of this Agreement.
(b) No order preventing or suspending the use of any preliminary
prospectus or the Prospectus shall have been or shall be in effect and no
order suspending the effectiveness of the Registration Statement shall be
in effect and no proceedings for such purpose shall be pending before or
threatened by the Commission, and any requests for additional information
on the part of the Commission (to be included in the Registration
Statement or the Prospectus or otherwise) shall have been complied with to
the satisfaction of the Representatives.
(c) The representations and warranties of the Trust and the Company
contained in this Agreement and in the certificates delivered pursuant to
Section 5(g) shall be true and correct when made and on and as of each
Closing Date as if made on such date and each of the Trust and the Company
shall have performed all covenants and agreements and satisfied all the
conditions contained in this Agreement required to be performed or
satisfied by it at or before such Closing Date.
(d) The Representatives shall have received at the time this
Agreement is executed and on each Closing Date a signed letter from Arthur
Andersen LLP addressed to the Representatives and dated, respectively, the
date of this Agreement and each such Closing Date, in form and substance
reasonably satisfactory to the Representatives.
(e) The Representatives shall have received on each Closing Date
from Stevens & Lee, counsel to the Company and the Trust, an opinion,
addressed to the Representatives and dated such Closing Date, and stating
in effect that:
(f) The Company is duly registered as a bank holding company under
the BHC Act and the Company and each of its Subsidiaries have been duly
incorporated and are validly existing as corporations in good standing
under the laws of their respective jurisdictions of incorporation, are
duly qualified to do business and are in good standing as foreign
corporations in each jurisdiction in which their respective ownership or
lease of property or the conduct of their respective businesses requires
such qualification, and have all corporate power necessary to own or hold
their respective properties, to operate their branches and conduct the
business in which they are engaged as described in the Prospectus;
(g) The Company's capitalization is as set forth in the Prospectus;
and all of the issued shares of capital stock of each of the Subsidiaries
of the Company have been duly and validly authorized and issued and are
fully paid and non-assessable and, to the best of such counsel's
knowledge, are owned directly or indirectly by the Company, free and clear
of all liens, encumbrances, equities or claims; and no holder of any
security of the Company has the right, under the Company's certificate of
incorporation or by-laws or any agreement or instrument known to such
counsel, to have any security owned by such holder included in the
Registration Statement or to
<PAGE> 12
12
require the Company to register under the Securities Act any security
owned by such holder.
(h) The Registration Statement was declared effective under the
Securities Act at the time and on the date specified in such counsel's
opinion and to the best knowledge of such counsel, no stop order or other
order suspending the effectiveness of the Registration Statement has been
issued and no proceedings for that purpose are pending before the
Commission under the Securities Act.
(i) The Registration Statement and the Prospectus and any further
amendments or supplements thereto made by the Company prior to such
Closing Date (other than the financial statements and related notes and
schedules therein, as to which such counsel need express no opinion)
comply as to form in all material respects with the requirements of the
Securities Act and the Rules; and the documents incorporated by reference
in the Prospectus (other than the financial statements and related
schedules therein, as to which such counsel need express no opinion), when
they were filed with the Commission, complied as to form in all material
respects with the requirements of the Exchange Act and the rules and
regulations of the Commission thereunder;
(j) The Company and the Trust meet all the conditions necessary for
the use of Form S-3 in connection with the issuance and sale of the
Capital Securities, the Guarantee and the Junior Debentures.
(k) To the best knowledge of such counsel, the businesses of the
Company and the Subsidiaries have been conducted in all material respects
in compliance with all applicable laws, rules and regulations of the
Commonwealth of Pennsylvania, the United States and any other
jurisdictions in which the Company or any of the Subsidiaries transact
business, which laws are material to the operations of the Company. To the
best knowledge of such counsel, neither the Company nor any of the
Subsidiaries is in violation of or conflict with any term or provision of
its charter or by-laws or other governing documents and neither the
Company nor any of the Subsidiaries is in violation of any franchise,
license, permit, judgment, decree, order, statute, rule, regulation,
directive, policy or guideline to which it or its property may be subject,
except for such violations which could not, individually or in the
aggregate, have a material adverse effect on the Company.
(l) To the best knowledge of such counsel, no default exists, and no
event has occurred which with notice or lapse of time or both would
constitute a default, in the due performance and observance of any term,
covenant or condition by the Company or any of the Subsidiaries of any
material agreement, indenture, mortgage, deed of trust, note or any other
material agreement or material instrument to which the Company or any of
the Subsidiaries is a party or by which it or its properties or businesses
may be bound.
(i) Neither the execution, delivery and performance of the
Agreement or the Operative Documents by the Trust and the Company
nor the consummation of any of the transactions contemplated hereby
or thereby (including, without limitation, the issuance and sale by
the Company of the Junior Debentures and the Guarantee and by the
Trust of the Capital Securities) will give rise to a right to
terminate or accelerate the due date of
<PAGE> 13
13
any payment due under, or conflict with or result in the breach of
any term or provision of, or constitute a default (or an event which
with notice or lapse of time or both would constitute a default)
under, or require any consent or waiver under, or result in the
execution or imposition of any lien, charge or encumbrance upon any
properties or assets of the Trust, the Company or any of the
Company's Subsidiaries pursuant to the terms of, any indenture,
mortgage, deed of trust or other agreement or instrument to which
the Trust, the Company or any of the Company's Subsidiaries is a
party or by which it or any of its properties or businesses is
bound, and no franchise, license, permit, judgment, decree, order,
statute, rule or regulation applicable to the Trust, the Company or
any of the Company's subsidiaries violate any provision of the
charter or by-laws of the Company or any of its subsidiaries, the
Trust Agreement or any statute or any order, rule or regulation of
any court or governmental agency or body having jurisdiction over
the Trust, the Company or any of the Company's Subsidiaries or any
of their properties or assets.
(ii) This Agreement has been duly authorized, executed and
delivered by the Company.
(iii) The Trust Agreement has been duly authorized, executed
and delivered by the Company.
(iv) The Indenture has been duly authorized, executed and
delivered by the Company and (assuming due authorization, execution
and delivery thereof by the Indenture Trustee) constitutes a valid
and binding agreement of the Company enforceable against the Company
in accordance with its terms, subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and
other similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in a
proceeding in equity or at law) and an implied covenant of good
faith and fair dealing; and the Junior Subordinated Debentures have
been duly authorized, executed, issued and delivered by the Company
as contemplated in the Indenture and (assuming due authentication by
the Indenture Trustee) constitute valid and binding obligations of
the Company entitled to the benefits of the Indenture and
enforceable in accordance with their terms, subject to the effects
of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles (whether
considered in a proceeding in equity or at law) and an implied
covenant of good faith and fair dealing.
(v) The Guarantee Agreement has been duly authorized, executed
and delivered by the Company and, assuming due authorization,
execution and delivery by the Guarantee Trustee, constitutes a valid
and legally binding obligation of the Company enforceable against
the Company in accordance with its terms, subject to the effects of
bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles (whether
<PAGE> 14
14
considered in a proceeding in equity or at law) and an implied
covenant of good faith and fair dealing.
(vi) The statements contained in the Prospectus under the
caption "Certain United States Federal Income Tax Consequences" are
accurate in all material respects and constitute a fair summary of
the matters set forth therein;
(vii) To the best of such counsel's knowledge, there are no
contracts or other documents which are required to be described in
the Prospectus or filed as exhibits to the Registration Statements
by the Securities Act or by the Rules and Regulations which have not
been described or filed as exhibits to the Registration Statements
or incorporated therein by reference as permitted by the Rules and
Regulations.
(viii) The statements in the Prospectus under the captions
"Description of Series A Capital Securities," "Description of Series
A Subordinated Debentures," "Description of Series A Guarantee," and
"Relationship Among the Series A Capital Securities, the Series A
Subordinated Debentures and the Series A Guarantee," insofar as such
statements constitute a summary of documents referred to therein or
matters of law, are fair summaries in all material respects and
accurately present the information called for with respect to such
documents and matters. All contracts and other documents required to
be filed as exhibits to, or described in, the Registration Statement
have been so filed with the Commission or are fairly described in
the Registration Statement, as the case may be.
To the extent deemed advisable by such counsel, they may rely as to
matters of fact on certificates of responsible officers of the Company and
public officials and on the opinions of other counsel satisfactory to the
Representatives as to matters which are governed by laws other than the laws of
the Commonwealth of Pennsylvania and the federal laws of the United States of
America; provided that such counsel shall state that in their opinion the
Underwriters and they are justified in relying on such other opinions. Copies of
such certificates and other opinions shall be furnished to the Representatives
and counsel for the Underwriters.
In addition, such counsel shall state that such counsel has
participated in conferences with officers and other representatives of the
Company, representatives of the Representatives and representatives of the
independent certified public accountants of the Company, at which conferences
the contents of the Registration Statement and the Prospectus and related
matters were discussed and, although such counsel is not passing upon and does
not assume any responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement and the Prospectus (except as
specified in the foregoing opinion), on the basis of the foregoing, no facts
have come to the attention of such counsel which lead such counsel to believe
that the Registration Statement at the time it became effective (except with
respect to the financial statements and notes and schedules thereto and other
financial data, as to which such counsel need express no belief) contained any
untrue statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein not misleading,
or that the Prospectus as amended or supplemented (except with respect to the
financial statements and notes schedules thereto and other financial data, as to
which such counsel need make no
<PAGE> 15
15
statement), as of its issue date and at the date of such opinion, contained any
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, not misleading.
(m) Richards Layton & Finger shall have furnished to the
Representatives its written opinion, as special Delaware counsel to the
Trust and the Company, addressed to the Underwriters and dated the Firm
Closing Date, in form and substance satisfactory to the Representatives,
to the effect that:
(i) The Trust has been duly created and is validly existing in
good standing as a business trust under the Delaware Act, and all
filings required under the laws of the State of Delaware with
respect to the creation and valid existence of the Trust as a
business trust have been made;
(ii) Under the Delaware Act and the Trust Agreement the Trust
has the trust power and authority to own its property and conduct
its business as set forth in the Trust Agreement;
(iii) The Trust Agreement constitutes a valid and binding
obligation of the Company and the Trustees, and is enforceable
against the Company and the Trustees in accordance with its terms,
subject, as to enforcement, to the effect upon the Trust Agreement
of (i) bankruptcy, insolvency, moratorium, receivership,
reorganization, liquidation, fraudulent transfer and other similar
laws relating to the rights and remedies of creditors generally,
(ii) principles of equity, including applicable law relating to
fiduciary duties (regardless of whether considered and applied in a
proceeding in equity or at law), and (iii) the effect of applicable
public policy on the enforceability of provisions relating to
indemnification or contribution;
(iv) Under the Delaware Act and the Trust Agreement, the Trust
has the trust power and authority (i) to execute and deliver, and to
perform its obligations under, the Operative Documents and (ii) to
issue and perform its obligations under the Capital Securities and
the Common Securities;
(v) Under the Delaware Act and the Trust Agreement, the
execution and delivery by the Trust of this Agreement, and the
performance by the Trust of its obligations hereunder, have been
duly authorized by all necessary trust action on the part of the
Trust;
(vi) The Capital 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 nonassessable
undivided beneficial interests in the assets of the Trust and are
entitled to the benefits of the Trust Agreement. The holders of the
Capital Securities, 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. Such counsel may
note that the holders of Capital Securities may be obligated,
pursuant to the Declaration, (i) to provide indemnity and/or
security in connection with and pay taxes or governmental
<PAGE> 16
16
charges arising from transfers or exchanges of certificates of
Capital Securities and the issuance of replacement certificates of
Capital Securities, and (ii) to provide security or indemnity in
connection with requests of or directions to the Property Trustee to
exercise its rights and powers under the Trust Agreement;
(vii) Under the Delaware Act and the Trust Agreement, the
issuance of the Capital Securities is not subject to preemptive
rights;
(viii) The issuance and sale by the Trust of the Capital
Securities and Common Securities, the execution, delivery and
performance by the Trust of the Operative Documents, the
consummation by the Trust of the transactions contemplated hereby
and compliance by the Trust with its obligations hereunder, and the
performance by the Company, as depositor, of its obligations under
the Trust Agreement (A) do not violate (i) any of the provisions of
the certificate of trust of the Trust or the Trust Agreement or (ii)
any applicable Delaware law or administrative regulation (except
that such counsel need express no opinion with respect to the
securities laws of the State of Delaware) and (B) do not require any
consent, approval, license, authorization or validation of, or
filing or registration with, any Delaware legislative,
administrative or regulatory body under the laws or administrative
regulations of the State of Delaware (except that such counsel need
express no opinion with respect to the securities laws of the state
of Delaware); and
(ix) Assuming that the Trust derives no income from or in
connection 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 holders of the
Capital Securities (other than those holders of Capital 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 Trust, and the Trust will
not be liable for any income tax imposed by the State of Delaware.
(n) The Representatives shall have received on each Closing
Date a certificate, addressed to the Representatives and dated such
Closing Date, of the chief executive or chief operating officer and
the chief financial officer or chief accounting officer of the
Company to the effect that the signers of such certificate have
carefully examined the Registration Statement, the Prospectus and
this Agreement and that the representations and warranties of the
Company and the Trust in this Agreement are true and correct on and
as of such Closing Date with the same effect as if made on such
Closing Date and the Company and the Trust has each performed all
covenants and agreements and satisfied all conditions contained in
this Agreement required to be performed or satisfied by it at or
prior to such Closing Date.
(o) The Representatives shall have received on each Closing
Date a certificate, addressed to the Representatives and dated such
Closing Date, of the chief executive or chief operating officer and
the chief financial officer or chief accounting officer of the
Company tot he effect that the signers of such certificate have
carefully examined the Registration Statement, the Prospectus
<PAGE> 17
17
and this Agreement and that the representations and warranties of
the Company and the Trust in this Agreement are true and correct on
and as of such Closing Date with the same effect as if made on such
Closing Date and the Company and the Trust has performed all
covenants and agreements and satisfied all conditions contained in
this Agreement required to be performed or satisfied by it at or
prior to such Closing Date.
(p) All proceedings taken in connection with the sale of the
Firm Capital Securities and the Option Capital Securities as herein
contemplated shall be reasonably satisfactory in form and substance
to the Representatives and their counsel and the Underwriters shall
have received from Simpson Thacher & Bartlett a favorable opinion,
addressed to the Representatives and dated such Closing Date, with
respect to the Capital Securities the Registration Statement and the
Prospectus, and such other related matters, as the Representatives
may reasonably request, and the Company shall have furnished to
Simpson Thacher & Bartlett such documents as they may reasonably
request for the purpose of enabling them to pass upon such matters.
(q) Subsequent to the execution and delivery of this Agreement
(i) no downgrading shall have occurred in the rating accorded the
Company's debt securities by any "nationally recognized statistical
rating organization," as that term is defined by the Commission for
purposes of Rule 436(g)(2) of the Rules and Regulations 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.
6. Covenants of the Trust and the Company.
(a) Each of the Trust and the Company covenants and agrees as
follows:
(i) To prepare the Prospectus in a form approved by the
Representatives and file such Prospectus pursuant to Rule 424(b)
under the Securities Act not later than 10:00 A.M. on the day
following the execution and delivery of this Agreement, and shall
promptly advise the Representatives (A) when any amendment to the
Registration Statement shall have become effective, (B) of any
request by the Commission for any amendment of the Registration
Statement or the Prospectus or for any additional information, (C)
of the prevention or suspension of the use of any preliminary
prospectus or the Prospectus or of the issuance by the Commission of
any stop order suspending the effectiveness of the Registration
Statement or the institution or threatening of any proceeding for
that purpose, and (D) of the receipt by the Trust or the Company of
any notification with respect to the suspension of the qualification
of the Capital Securities for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose.
Neither the Trust nor the Company shall file any amendment of the
Registration Statement or supplement to the Prospectus unless the
Trust or the Company has furnished the Representatives a copy for
its review prior to filing and shall not file any such proposed
amendment or supplement to which the Representatives
<PAGE> 18
18
reasonably object. Each of the Trust and the Company shall use its
best efforts to prevent the issuance of any such stop order and, if
issued, to obtain as soon as possible the withdrawal thereof.
(ii) If, at any time when a prospectus relating to the Capital
Securities is required to be delivered under the Securities Act and
the Rules, any event occurs as a result of which the Prospectus as
then amended or supplemented would include any untrue statement of a
material fact or omit to state any material fact necessary to make
the statements therein in the light of the circumstances under which
they were made not misleading, or if it shall be necessary to amend
or supplement the Prospectus to comply with the Securities Act or
the Rules, to promptly shall prepare and file with the Commission,
subject to the second sentence of paragraph (i) of this Section
6(a), an amendment or supplement which shall correct such statement
or omission or an amendment which shall effect such compliance.
(iii) To make generally available to its security holders and
to the Representatives as soon as practicable, but not later than 45
days after the end of the 12-month period beginning at the end of
the fiscal quarter of the Company during which the Effective Date
occurs (or 90 days if such 12-month period coincides with the
Company's fiscal year), an earning statement (which need not be
audited) of the Company, covering such 12-month period, which shall
satisfy the provisions of Section 11(a) of the Securities Act or
Rule 158 of the Rules.
(iv) To furnish to the Representatives and counsel for the
Underwriters, without charge, (i) signed copies of the Registration
Statement (including all exhibits thereto and amendments thereof)
and to each other Underwriter a copy of the Registration Statement
(without exhibits thereto) and all amendments thereof (ii) copies of
any document incorporated by reference in the Prospectus (including
exhibits thereto) and, (iii) so long as delivery of a prospectus by
an Underwriter or dealer may be required by the Securities Act or
the Rules, as many copies of any preliminary prospectus and the
Prospectus and any amendments thereof and supplements thereto as the
Representatives may reasonably request. Delivery of the Prospectus
shall be no later than 10:00 A.M. New York City time of the day
following execution and delivery of this Agreement.
(v) To cooperate with the Representatives and their counsel in
endeavoring to qualify the Capital Securities for offer and sale
under the laws of such jurisdictions as the Representatives may
designate and shall maintain such qualifications in effect so long
as required for the distribution of the Capital Securities;
provided, however, that neither the Trust nor the Company shall be
required in connection therewith, as a condition thereof, to qualify
as a foreign corporation or to execute a general consent to service
of process in any jurisdiction or subject itself to taxation as
doing business in any jurisdiction.
(vi) For a period of five years after the date of this
Agreement, to supply to the Representatives, and to each other
Underwriter who may so request in writing, copies of such financial
statements and other periodic and
<PAGE> 19
19
special reports as the Company may from time to time distribute
generally to the holders of any class of its capital stock and to
furnish to the Representatives a copy of each annual or other report
it shall be required to file with the Commission.
(vii) Without the prior written consent of CIBC Oppenheimer
Corp., on behalf of the Representatives, for a period of 180 days
after the date of this Agreement, not to offer, issue, sell,
contract to sell or otherwise dispose of any additional securities
of the Trust or the Company substantially similar to the Capital
Securities or any securities convertible into or exchangeable for or
that represent the right to receive any such similar securities.
(viii) On or before completion of this offering the Company
and the Trust shall make all filings required under applicable
securities laws and by the NASDAQ National Market System
(b) Each of the Trust and the Company agrees to pay, or reimburse if
paid by the Representatives, whether or not the transactions contemplated
hereby are consummated or this Agreement is terminated, all costs and
expenses incident to the public offering of the Capital Securities and the
performance of the obligations of the Trust and the Company under this
Agreement including those relating to: (i) the preparation, printing,
filing and distribution of the Registration Statement including all
exhibits thereto, each preliminary prospectus, the Prospectus, all
amendments and supplements to the Registration Statement and the
Prospectus, and the printing, filing and distribution of this Agreement;
(ii) the preparation and delivery of certificates for the Capital
Securities to the Underwriters; (iii) the registration or qualification of
the Capital Securities for offer and sale under the securities or Blue Sky
laws of the various jurisdictions referred to in Section 6(a)(iv),
including the reasonable fees and disbursements of counsel for the
Underwriters in connection with such registration and qualification and
the preparation, printing, distribution and shipment of preliminary and
supplementary Blue Sky memoranda; (iv) the furnishing (including costs of
shipping and mailing) to the Representatives and to the Underwriters of
copies of each preliminary prospectus, the Prospectus and all amendments
or supplements to the Prospectus, and of the several documents required by
this Section to be so furnished, as may be reasonably requested for use in
connection with the offering and sale of the Capital Securities by the
Underwriters or by dealers to whom Capital Securities may be sold; (v) the
furnishing (including costs of shipping and mailing) to the
Representatives and to the Underwriters of copies of all reports and
information required by Section 6(a)(v); (vi) inclusion of the Capital
Securities in quotation on the NASDAQ National Market System and (vii) all
transfer taxes, if any, with respect to the sale and delivery of the
Capital Securities by the Trust to the Underwriters. Subject to the
provisions of Section 9, the Underwriters agree to pay, whether or not the
transactions contemplated hereby are consummated or this Agreement is
terminated, all costs and expenses incident to the performance of the
obligations of the Underwriters under this Agreement not payable by the
Company or the Trust pursuant to the preceding sentence, including,
without limitation, the fees and disbursements of counsel for the
Underwriters.
<PAGE> 20
20
7. Indemnification.
(a) The Trust and the Company agree, jointly and severally, to
indemnify and hold harmless each Underwriter and each person, if any, who
controls any Underwriter within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act against any and all
losses, claims, damages and liabilities, joint or several (including any
reasonable investigation, legal and other expenses incurred in connection
with, and any amount paid in settlement of, any action, suit or proceeding
or any claim asserted), to which they, or any of them, may become subject
under the Securities Act, the Exchange Act or other Federal or state law
or regulation, at common law or otherwise, insofar as such losses, claims,
damages or liabilities arise out of or are based upon any untrue statement
or alleged untrue statement of a material fact contained in any
preliminary prospectus, the Registration Statement or the Prospectus or
any amendment thereof or supplement thereto, or arise out of or are based
upon any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein
not misleading; provided, however, that such indemnity shall not inure to
the benefit of any Underwriter (or any person controlling such
Underwriter) on account of any losses, claims, damages or liabilities
arising from the sale of the Capital Securities to any person by such
Underwriter if such untrue statement or omission or alleged untrue
statement or omission was made in such preliminary prospectus, the
Registration Statement or the Prospectus, or such amendment or supplement,
in reliance upon and in conformity with information furnished in writing
to the Company by the Representatives on behalf of any Underwriter
specifically for use therein. This indemnity agreement will be in addition
to any liability which the Trust and the Company may otherwise have.
(b) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Trust and the Company, each person, if any, who
controls the Trust or the Company within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act, each director of the
Company, and each officer of the Trust or of the Company who signs the
Registration Statement, to the same extent as the foregoing indemnity from
the Trust and the Company to each Underwriter, but only insofar as such
losses, claims, damages or liabilities arise out of or are based upon any
untrue statement or omission or alleged untrue statement or omission which
was made in any preliminary prospectus, the Registration Statement or the
Prospectus, or any amendment thereof or supplement thereto, contained in
the last paragraph of the cover page, in the paragraph relating to
stabilization on the inside front cover page of the Prospectus and the
statements contained in the last paragraph under the caption
"Underwriting" in the Prospectus.
(c) Any party that proposes to assert the right to be indemnified
under this Section will, promptly after receipt of notice of commencement
of any action, suit or proceeding against such party in respect of which a
claim is to be made against an indemnifying party or parties under this
Section, notify each such indemnifying party of the commencement of such
action, suit or proceeding, enclosing a copy of all papers served. No
indemnification provided for in Section 7(a) or 7(b) shall be available to
any party who shall fail to give notice as provided in this Section 7(c)
if the party to whom notice was not given was unaware of the proceeding to
which such notice would have related and was prejudiced by the failure to
give such notice
<PAGE> 21
21
but the omission so to notify such indemnifying party of any such action,
suit or proceeding shall not relieve it from any liability that it may
have to any indemnified party for contribution or otherwise than under
this Section. In case any such action, suit or proceeding 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 in, and, to the extent that it shall wish, jointly with any
other indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified party,
and after notice from the indemnifying party to such indemnified party of
its election so to assume the defense thereof and the approval by the
indemnified party of such counsel, the indemnifying party shall not be
liable to such indemnified party for any legal or other expenses, except
as provided below and except for the reasonable costs of investigation
subsequently incurred by such indemnified party in connection with the
defense thereof. The indemnified party shall have the right to employ its
counsel in any such action, but the fees and expenses of such counsel
shall be at the expense of such indemnified party unless (i) the
employment of counsel by such indemnified party has been authorized in
writing by the indemnifying parties, (ii) the indemnified party shall have
reasonably concluded that there may be a conflict of interest between the
indemnifying parties and the indemnified party in the conduct of the
defense of such action (in which case the indemnifying parties shall not
have the right to direct the defense of such action on behalf of the
indemnified party) or (iii) the indemnifying parties shall not have
employed counsel to assume the defense of such action within a reasonable
time after notice of the commencement thereof, in each of which cases the
fees and expenses of counsel shall be at the expense of the indemnifying
parties. An indemnifying party shall not be liable for any settlement of
any action, suit, proceeding or claim effected without its written
consent.
8. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnification provided for in
Section 7(a) is due in accordance with its terms but for any reason is held to
be unavailable from the Trust or the Company, each of the Trust, the Company,
and the Underwriters shall contribute to the aggregate losses, claims, damages
and liabilities (including any investigation, legal and other expenses
reasonably incurred in connection with, and any amount paid in settlement of,
any action, suit or proceeding or any claims asserted, but after deducting any
contribution received by the Trust or the Company from persons other than the
Underwriters, such as persons who control the Trust or the Company within the
meaning of the Securities Act, officers of the Trust or of the Company who
signed the Registration Statement and directors of the Company, who may also be
liable for contribution) to which the Trust, the Company and one or more of the
Underwriters may be subject in such proportion as is appropriate to reflect the
relative benefits received by the Trust and the Company on the one hand and the
Underwriters on the other from the offering of the Capital Securities or, if
such allocation is not permitted by applicable law or indemnification is not
available as a result of the indemnifying party not having received notice as
provided in Section 7 hereof, in such proportion as is appropriate to reflect
not only the relative benefits referred to above but also the relative fault of
the Trust and the Company on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Trust, the
Company and the Underwriters shall be deemed to be in the same proportion as (x)
the total proceeds from the offering before deducting expenses) received by the
Trust and the Company, as set forth in the table on the cover page
<PAGE> 22
22
of the Prospectus, bear to (y) the underwriting discounts received by the
Underwriters, as set forth in the table on the cover page of the Prospectus. The
relative fault of the Trust and the Company or the Underwriters shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact related to information supplied by the Trust
and the Company or the Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Trust, the Company and the Underwriters agree that it would not be
just and equitable if contribution pursuant to this Section 8 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. Notwithstanding the
provisions of this Section 8, (i) in no case shall any Underwriter be liable or
responsible for any amount in excess of the underwriting discount applicable to
the Capital Securities purchased by such Underwriter hereunder, and (ii) the
Trust and the Company shall be liable and responsible for any amount in excess
of such underwriting discount; provided, however, that no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. For purposes of this Section 8,
each person, if any, who controls an Underwriter within the meaning of Section
15 of the Securities Act or Section 20(a) of the Exchange Act shall have the
same rights to contribution as such Underwriter, and each person, if any, who
controls the Trust or the Company within the meaning of the Section 15 of the
Securities Act or Section 20(a) of the Exchange Act, each officer of the Trust
or of the Company who shall have signed the Registration Statement and each
director of the Company shall have the same rights to contribution as the Trust
and the Company, subject in each case to clauses (i) and (ii) in the immediately
preceding sentence of this Section 8. Any party entitled to contribution will,
promptly after receipt of notice of commencement of any action, suit or
proceeding against such party in respect of which a claim for contribution may
be made against another party or parties under this Section, notify such party
or parties from whom contribution may be sought, but the omission so to notify
such party or parties from whom contribution may be sought shall not relieve the
party or parties from whom contribution may be sought from any other obligation
it or they may have hereunder or otherwise than under this Section. No party
shall be liable for contribution with respect to any action, suit, proceeding or
claim settled without its written consent. The Underwriter's obligations to
contribute pursuant to this Section 8 are several in proportion to their
respective underwriting commitments and not joint.
9. Termination. This Agreement may be terminated with respect to the
Capital Securities to be purchased on a Closing Date by the Representatives by
notifying the Trust and the Company at any time:
(a) in the absolute discretion of the Representatives at or before
any Closing Date: (i) if on or prior to such date, any domestic or
international event or act or occurrence has materially disrupted, or in
the opinion of the Representatives will in the future materially disrupt,
the securities markets; (ii) if there has occurred any new outbreak or
material escalation of hostilities or other calamity or crisis the effect
of which on the financial markets of the United States of America is such
as to make it, in the judgment of the Representatives, inadvisable to
proceed with the offering; (iii) if there shall be such a material adverse
change in general financial, political or economic conditions or the
effect of international conditions on the financial markets in the United
States of America is such as to make it, in the judgment of the
<PAGE> 23
23
Representatives, inadvisable or impracticable to market the Capital
Securities; (iv) if trading in the Capital Securities has been suspended
by the Commission or trading generally on the New York Stock Exchange,
Inc. or on the American Stock Exchange, Inc. has been suspended or
limited, or minimum or maximum ranges for prices for securities shall have
been fixed, or maximum ranges for prices for securities have been
required, by said exchanges or by order of the Commission, the National
Association of Securities Dealers, Inc., or any other governmental or
regulatory authority; or (v) if a banking moratorium has been declared by
any state or Federal authority, or
(b) at or before any Closing Date, that any of the conditions
specified in Section 5 shall not have been fulfilled when and as required
by this Agreement.
If this Agreement is terminated pursuant to any of its provisions,
neither the Trust nor the Company shall be under any liability to any
Underwriter, and no Underwriter shall be under any liability to the Trust and
the Company, except that (y) if this Agreement is terminated by the
Representatives or the Underwriters because of any failure, refusal or inability
on the part of the Trust or the Company to comply with the terms or to fulfill
any of the conditions of this Agreement, the Trust or the Company will reimburse
the Underwriters for all out-of-pocket expenses (including the reasonable fees
and disbursements of their counsel) incurred by them in connection with the
proposed purchase and sale of the Capital Securities or in contemplation of
performing their obligations hereunder and (z) no Underwriter who shall have
failed or refused to purchase the Capital Securities agreed to be purchased by
it under this Agreement, without some reason sufficient hereunder to justify
cancellation or termination of its obligations under this Agreement, shall be
relieved of liability to the Trust the Company or to the other Underwriters for
damages occasioned by its failure or refusal.
10. Substitution of Underwriters. If one or more of the Underwriters
shall fail (other than for a reason sufficient to justify the cancellation or
termination of this Agreement under Section 9) to purchase on any Closing Date
the Capital Securities agreed to be purchased on such Closing Date by such
Underwriter or Underwriters, the Representatives may find one or more substitute
underwriters to purchase such Capital Securities or make such other arrangements
as the Representatives may deem advisable or one or more of the remaining
Underwriters may agree to purchase such Capital Securities in such proportions
as may be approved by the Representatives, in each case upon the terms set forth
in this Agreement. If no such arrangements have been made by the close of
business on the business day following such Closing Date,
(a) if the number of Capital Securities to be purchased by the
defaulting Underwriters on such Closing Date shall not exceed 10% of the
Capital Securities that all the Underwriters are obligated to purchase on
such Closing Date, then each of the nondefaulting Underwriters shall be
obligated to purchase such Capital Securities on the terms herein set
forth in proportion to their respective obligations hereunder; provided,
that in no event shall the maximum number of Capital Securities that any
Underwriter has agreed to purchase pursuant to Section 1 be increased
pursuant to this Section 10 by more than one ninth of such number of
Capital Securities without the written consent of such Underwriter, or
<PAGE> 24
24
(b) if the number of Capital Securities to be purchased by the
defaulting Underwriters on such Closing Date shall exceed 10% of the
Capital Securities that all the Underwriters are obligated to purchase on
such Closing Date, then the Company and Trust shall be entitled to an
additional business day within which it may, but is not obligated to, find
one or more substitute underwriters reasonably satisfactory to the
Representatives to purchase such Capital Securities upon the terms set
forth in this Agreement.
In any such case, either the Representatives, the Trust or the
Company shall have the right to postpone the applicable Closing Date for a
period of not more than five (5) business days in order that necessary changes
and arrangements (including any necessary amendments or supplements to the
Registration Statement or Prospectus) may be effected by the Representatives,
the Trust and the Company. If the number of Capital Securities to be purchased
on such Closing Date by such defaulting Underwriter or Underwriters shall exceed
10% of the Capital Securities that all the Underwriters are obligated to
purchase on such Closing Date, and none of the nondefaulting Underwriters, the
Trust or the Company shall make arrangements pursuant to this Section within the
period stated for the purchase of the Capital Securities that the defaulting
Underwriters agreed to purchase, this Agreement shall terminate with respect to
the Capital Securities to be purchased on such Closing Date without liability on
the part of any nondefaulting Underwriter to the Trust and the Company and
without liability on the part of the Trust and the Company, except in both cases
as provided in Sections 6(b), 7, 8 and 9. The provisions of this Section shall
not in any way affect the liability of any defaulting Underwriter to the Trust,
the Company or the nondefaulting Underwriters arising out of such default. A
substitute underwriter hereunder shall become an Underwriter for all purposes of
this Agreement.
11. Miscellaneous. The respective agreements, representations,
warranties, indemnities and other statements of the Trust and the Company or
their officers and of the Underwriters set forth in or made pursuant to this
Agreement shall remain in full force and effect, regardless of any investigation
made by or on behalf of any Underwrite, the Trust or the Company or any of the
officers, directors or controlling persons referred to in Sections 7 and 8
hereof, and shall survive delivery of and payment for the Capital Securities.
The provisions of Sections 6(b), 7, 8 and 9 shall survive the termination or
cancellation of this Agreement.
This Agreement has been and is made for the benefit of the
Underwriters, the Trust and the Company, and each of their respective successors
and assigns, and, to the extent expressed herein, for the benefit of persons
controlling any of the Underwriters, the Trust or the Company, and directors and
officers of the Trust and the Company, and each of their respective successors
and assigns, and no other person shall acquire or have any right under or by
virtue of this Agreement. The term "successors and assigns" shall not include
any purchaser of Capital Securities from any Underwriter merely because of such
purchase.
All notices and communications hereunder shall be in writing and
mailed or delivered or by telephone or telegraph if subsequently confirmed in
writing, (a) if to the Representatives, c/o CIBC Oppenheimer Corp., Oppenheimer
Tower, World Financial Center, New York, New York 10281 Attention: ____________,
(b) if to the Trust or the Company, to the address of the Company set forth on
the cover page of the Registration Statement, Attention: Secretary.
<PAGE> 25
25
This Agreement shall be governed by and construed in accordance with
the laws of the State of New York without regard to principles of conflict of
laws.
This Agreement may be signed in any number of counterparts, each of
which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument.
Please confirm that the foregoing correctly sets forth the agreement among
us.
Very truly yours,
USBANCORP CAPITAL TRUST I
By__________________________________
Name:
Title:
USBANCORP, INC.
By__________________________________
Name:
Title:
Confirmed:
CIBC OPPENHEIMER CORP.
LEGG MASON WOOD WALKER
Acting severally on behalf of itself and as representative of the several
Underwriters named in Schedule I annexed hereto.
By CIBC OPPENHEIMER CORP.
By____________________________
Name:
Title:
<PAGE> 26
SCHEDULE I
<TABLE>
<CAPTION>
Maximum Number of
Number of Firm Optional Capital
Capital Securities Securities Which
Securities Underwriter to be Purchased May Be Purchased
- ---------------------- --------------- ----------------
<S> <C> <C>
CIBC Oppenheimer Corp.
Legg Mason Wood Walker
Incorporated
--------- -------
1,200,000 180,000
========= =======
</TABLE>
<PAGE> 1
EXHIBIT 4.1
USBANCORP, INC.
TO
THE BANK OF NEW YORK
TRUSTEE
JUNIOR SUBORDINATED INDENTURE
DATED AS OF APRIL 1, 1998
<PAGE> 2
USBANCORP, INC.
Reconciliation and tie between the Trust Indenture Act of 1939
(including cross-references to provisions of Sections 310 to and including 317
which, pursuant to Section 318(c) of the Trust Indenture Act of 1939, as amended
by the Trust Reform Act of 1990, are a part of and govern the Indenture whether
or not physically contained therein) and the Junior Subordinated Indenture,
dated as of April 1, 1998.
<TABLE>
<CAPTION>
Trust Indenture Indenture
ACT SECTION SECTION
- --------------- ---------
<S> <C>
Section 310 (a) (1), (2) and (5)..................................................... 6.9
(a) (3).................................................................. Not Applicable
(a) (4).................................................................. Not Applicable
(b)...................................................................... 6.8
......................................................................... 6.10
(c)...................................................................... Not Applicable
Section 311 (a)...................................................................... 6.13(a)
(b)...................................................................... 6.13(b)
(b) (2).................................................................. 7.3(a) (2)
......................................................................... 7.3(a) (2)
Section 312 (a)...................................................................... 7.1
......................................................................... 7.2(a)
(b)...................................................................... 7.2(b)
(c)...................................................................... 7.2(c)
Section 313 (a)...................................................................... 7.3(a)
(b)...................................................................... 7.3(b)
(c)...................................................................... 7.3(a), 7.3(b)
(d)...................................................................... 7.3(c)
Section 314 (a) (1), (2) and (3)..................................................... 7.4
(a) (4).................................................................. 10.4
(b)...................................................................... Not Applicable
(c) (1).................................................................. 1.2
(c) (2).................................................................. 1.2
(c) (3).................................................................. Not Applicable
(d)...................................................................... Not Applicable
(e)...................................................................... 1.2
(f)...................................................................... Not Applicable
Section 315 (a)...................................................................... 6.1(a)
(b)...................................................................... 6.2
......................................................................... 7.3(a) (6)
(c)...................................................................... 6.1(b)
(d)...................................................................... 6.1(c)
(d) (1).................................................................. 6.1(a) (1)
(d) (2).................................................................. 6.1(c) (2)
(d) (3).................................................................. 6.1(c) (3)
</TABLE>
<PAGE> 3
<TABLE>
<S> <C>
(e)...................................................................... 5.14
Section 316 (a)...................................................................... 1.1
(a) (1) (A).............................................................. 5.12
(a) (1) (B).............................................................. 5.13
(a) (2).................................................................. Not Applicable
(b)...................................................................... 5.8
(c)...................................................................... 1.4(f)
Section 317 (a) (1).................................................................. 5.3
(a) (2).................................................................. 5.4
(b)...................................................................... 10.3
Section 318 (a)...................................................................... 1.7
</TABLE>
- ----------
Note: This reconciliation and tie shall not, for any purpose, be deemed to be
a part of the Junior Subordinated Indenture.
<PAGE> 4
<TABLE>
<S> <C>
ARTICLE I - DEFINITIONS AND OTHER PROVISIONS OF GENERAL
APPLICATION.................................................................................................... 1
Section 1.1. Definitions. ................................................................. 1
Section 1.2. Compliance Certificate and Opinions. ......................................... 10
Section 1.3. Forms of Documents Delivered to Trustee....................................... 11
Section 1.4. Acts of Holders............................................................... 12
Section 1.5. Notices, Etc. to Trustee and Company.......................................... 14
Section 1.6. Notice to Holders; Waiver..................................................... 15
Section 1.7. Conflict with Trust Indenture Act............................................. 15
Section 1.8. Effect of Headings and Table of Contents...................................... 15
Section 1.9. Successors and Assigns........................................................ 15
Section 1.10. Separability Clause........................................................... 15
Section 1.11. Benefits of Indenture......................................................... 15
Section 1.12. Governing Law................................................................. 16
Section 1.13. Non-Business Days............................................................. 16
ARTICLE II- SECURITY FORMS .................................................................................... 16
Section 2.1. Forms Generally............................................................... 16
Section 2.2. Form of Face of Security...................................................... 17
Section 2.3. Form of Reverse of Security................................................... 20
Section 2.4. Additional Provisions Required in Global
Security.................................................................... 24
Section 2.5. Form of Trustee's Certificate of
Authentication.............................................................. 24
ARTICLE III - THE SECURITIES................................................................................... 25
Section 3.1. Title and Terms............................................................... 25
Section 3.2. Denominations................................................................. 27
Section 3.3. Execution, Authentication, Delivery and
Dating...................................................................... 27
Section 3.4. Temporary Securities.......................................................... 29
Section 3.5. Registration, Transfer and Exchange........................................... 30
Section 3.6. Mutilated, Destroyed, Lost and Stolen
Securities.................................................................. 32
Section 3.7. Payment of Interest; Interest Rights
Preserved................................................................... 33
Section 3.8. Persons Deemed Owners......................................................... 34
Section 3.9. Cancellation.................................................................. 34
Section 3.10. Computation of Interest....................................................... 35
Section 3.11. Deferral of Interest Payment Dates............................................ 35
Section 3.12. Right of Set-Off.............................................................. 36
Section 3.13. Agreed Tax Treatment.......................................................... 37
Section 3.14. Shortening or Extension of Stated
Maturity.................................................................... 37
Section 3.15. CUSIP Numbers................................................................. 37
ARTICLE IV - SATISFACTION AND DISCHARGE ....................................................................... 38
Section 4.1. Satisfaction and Discharge of Indenture....................................... 38
Section 4.2. Application of Trust Money.................................................... 39
ARTICLE V - REMEDIES .......................................................................................... 39
Section 5.1. Events of Default............................................................. 39
Section 5.2. Acceleration of Maturity; Rescission and
</TABLE>
(i)
<PAGE> 5
<TABLE>
<S> <C>
Annulment................................................................... 40
Section 5.3. Collection of Indebtedness and Suits for
Enforcement by Trustee...................................................... 42
Section 5.4. Trustee May File Proofs of Claim.............................................. 43
Section 5.5. Trustee May Enforce Claims Without
Possession of Securities.................................................... 44
Section 5.6. Application of Money Collected................................................ 44
Section 5.7. Limitation on Suits........................................................... 44
Section 5.8. Unconditional Right of Holders to Receive
Principal, Premium and Interest; Direct
Action by Holders of Preferred Securities................................... 45
Section 5.9. Restoration of Rights and Remedies............................................ 46
Section 5.10. Rights and Remedies Cumulative................................................ 46
Section 5.11. Delay or Omission Not Waiver.................................................. 46
Section 5.12. Control by Holders............................................................ 46
Section 5.13. Waiver of Past Defaults....................................................... 47
Section 5.14. Undertaking for Costs......................................................... 48
Section 5.15. Waiver of Usury, Stay or Extension Laws....................................... 48
ARTICLE VI - THE TRUSTEE ...................................................................................... 48
Section 6.1. Certain Duties and Responsibilities........................................... 48
Section 6.2. Notice of Defaults............................................................ 49
Section 6.3. Certain Rights of Trustee..................................................... 50
Section 6.4. Not Responsible for Recitals or Issuance
of Securities............................................................... 51
Section 6.5. May Hold Securities........................................................... 51
Section 6.6. Money Held in Trust........................................................... 52
Section 6.7. Compensation and Reimbursement................................................ 52
Section 6.8. Disqualification; Conflicting Interests....................................... 53
Section 6.9. Corporate Trustee Required; Eligibility....................................... 53
Section 6.10. Resignation and Removal; Appointment of
Successor................................................................... 53
Section 6.11. Acceptance of Appointment by Successor........................................ 55
Section 6.12. Merger, Conversion, Consolidation or
Succession to Business...................................................... 56
Section 6.13. Preferential Collection of Claims
Against Company............................................................. 57
Section 6.14. Appointment of Authenticating Agent........................................... 57
ARTICLE VII - HOLDER'S LISTS AND REPORTS BY TRUSTEE AND
COMPANY ....................................................................................................... 59
Section 7.1. Company to Furnish Trustee Names and
Addresses of Holders........................................................ 59
Section 7.2. Preservation of Information,
Communications to Holders................................................... 59
Section 7.3. Reports by Trustee............................................................ 59
Section 7.4. Reports by Company............................................................ 60
ARTICLE VIII - CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR
LEASE ......................................................................................................... 60
Section 8.1. Company May Consolidate, Etc., Only on
Certain Terms............................................................... 60
Section 8.2. Successor Corporation Substituted............................................. 61
</TABLE>
(ii)
<PAGE> 6
<TABLE>
<S> <C>
ARTICLE IX - SUPPLEMENTAL INDENTURES .......................................................................... 62
Section 9.1. Supplemental Indentures without Consent
of Holders.................................................................. 62
Section 9.2. Supplemental Indentures with Consent of
Holders..................................................................... 63
Section 9.3. Execution of Supplemental Indentures.......................................... 65
Section 9.4. Effect of Supplemental Indentures............................................. 65
Section 9.5. Conformity with Trust Indenture Act........................................... 65
Section 9.6. Reference in Securities to Supplemental
Indentures.................................................................. 65
ARTICLE X - COVENANTS.......................................................................................... 66
Section 10.1. Payment of Principal, Premium and
Interest.................................................................... 66
Section 10.2. Maintenance of Office or Agency............................................... 66
Section 10.3. Money for Security Payments to be Held
in Trust.................................................................... 66
Section 10.4. Statement as to Compliance; Statement by
Officers as to Default...................................................... 68
Section 10.5. Waiver of Certain Covenants................................................... 68
Section 10.6. Payment of Trust Costs and Expenses........................................... 69
Section 10.7. Additional Covenants.......................................................... 69
Section 10.8. Calculation of Original Issue Discount........................................ 70
ARTICLE XI - REDEMPTION OF SECURITIES ......................................................................... 70
Section 11.1. Applicability of This Article................................................. 70
Section 11.2. Election to Redeem; Notice to Trustee......................................... 71
Section 11.3. Selection of Securities to be Redeemed........................................ 71
Section 11.4. Notice of Redemption.......................................................... 71
Section 11.5. Deposit of Redemption Price................................................... 72
Section 11.6. Payment of Securities Called for
Redemption.................................................................. 73
Section 11.7. Right of Redemption of Securities
Initially Issued to a Trust................................................. 73
ARTICLE XII - SINKING FUNDS.................................................................................... 74
Section 12.1. Applicability of Article...................................................... 74
Section 12.2. Satisfaction of Sinking Fund Payments
with Securities............................................................. 74
Section 12.3. Redemption of Securities for Sinking
Fund........................................................................ 74
ARTICLE XIII - SUBORDINATION OF SECURITIES..................................................................... 76
Section 13.1. Securities Subordinate to Senior Debt......................................... 76
Section 13.2. Payment Over of Proceeds Upon
Dissolution, Etc............................................................ 76
Section 13.3. Prior Payment to Senior Debt Upon
Acceleration of Securities.................................................. 78
Section 13.4. No Payment When Senior Debt in Default........................................ 79
Section 13.5. Payment Permitted If No Default............................................... 80
Section 13.6. Subrogation to Rights of Holders of
Senior Debt................................................................. 80
Section 13.7. Provisions Solely to Define Relative
Rights...................................................................... 80
</TABLE>
(iii)
<PAGE> 7
<TABLE>
<S> <C>
Section 13.8. Trustee to Effectuate Subordination........................................... 81
Section 13.9. No Waiver of Subordination Provisions......................................... 81
Section 13.10. Notice to Trustee............................................................. 82
Section 13.11. Reliance on Judicial Order or
Certificate of Liquidating Agent............................................ 82
Section 13.12. Trustee Not Fiduciary for Holders of
Senior Debt................................................................. 83
Section 13.13. Rights of Trustee as Holder of Senior
Debt; Preservation of Trustee's Rights...................................... 83
Section 13.14. Article Applicable to Paying Agents........................................... 83
Section 13.15. Certain Conversions or Exchanges Deemed
Payment..................................................................... 83
Section 13.16. Trust Moneys Not Subordinated................................................. 84
</TABLE>
(iv)
<PAGE> 8
JUNIOR SUBORDINATED INDENTURE, dated as of April 1, 1998, between
USBANCORP, INC., a Pennsylvania corporation (hereinafter called the "Company")
having its principal office at Main and Franklin Streets, Johnstown,
Pennsylvania 15907 and THE BANK OF NEW YORK, a New York banking corporation, as
Trustee (hereinafter called the "Trustee").
RECITALS OF THE COMPANY
The Company 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 one or more series (hereinafter called the
"Securities") of substantially the tenor hereinafter provided, including,
without limitation, Securities issued to evidence loans made to the Company of
the proceeds from the issuance from time to time by one or more business trusts
(each a "Trust," and, collectively, the "Trusts") of preferred interests in such
Trusts (the "Preferred Securities") and common interests in such Trusts (the
"Common Securities" and, collectively with the Preferred Securities, the "Trust
Securities"), and to provide the terms and conditions upon which the Securities
are to be authenticated, issued and delivered.
All things necessary to make the Securities, when executed by the
Company and authenticated and delivered hereunder and duly issued by the
Company, the valid obligations of the Company, and to make this Indenture a
valid agreement of the Company, in accordance with their and 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 which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
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(3) All accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles,
and the term "generally accepted accounting principles" with respect to any
computation required or permitted hereunder shall mean such accounting
principles which are generally accepted at the date or time of such computation;
provided, that when two or more principles are so generally accepted, it shall
mean that set of principles consistent with those in use by the Company; and
(4) The words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
"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 from the
applicable Interest Payment Date.
"Additional Taxes" means the sum of any additional taxes, duties and
other governmental charges to which a Trust has become subject from time to time
as a result of a Tax Event.
"Administrative Trustee" means, in respect of any Trust, each Person
identified as an "Administrative Trustee" in the related Trust Agreement, solely
in such Person's capacity as Administrative Trustee of such Trust under such
Trust Agreement and not in such Person's individual capacity, or any successor
administrative trustee appointed as therein 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; provided, however, no Trust to which
Securities have been issued shall be deemed to be an Affiliate of the Company.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Authenticating Agent" means any Person authorized by the Trustee
pursuant to Section 6.14 to act on behalf of the Trustee to authenticate
Securities of one or more series.
"Board of Directors" means either the board of directors of the Company
or any committee of that board duly authorized to act hereunder.
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<PAGE> 10
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
the Board of Directors, or such committee of the Board of Directors or officers
of the Company 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 a Trust, the principal corporate trust office of the
Property Trustee under the related Trust Agreement, is closed for business.
"Capital Treatment Event", with respect to a Trust, means the
reasonable determination by the Company that, as a result of any amendment to,
or change (including any proposed change) in, the laws (or any regulations
thereunder) of the United States or any political subdivision thereof or
therein, or as a result of any official or administrative pronouncement or
action or judicial decision interpreting or applying such laws or regulations,
which amendment or change is effective or such proposed change, pronouncement,
action or decision is announced on or after the date of issuance of the
Preferred Securities of such Trust, there is more than an insubstantial risk
that the Company will not be entitled to treat an amount equal to the
Liquidation Amount (as defined in the related Trust Agreement) of such Preferred
Securities as "Tier 1 Capital" (or the then equivalent thereof) for purposes of
the capital adequacy guidelines of the Federal Reserve, as then in effect and
applicable to the Company.
"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 Indenture such Commission is not existing and performing the
duties now assigned to it under the Trust Indenture Act, then the body
performing such duties at such time.
"Common Securities" has the meaning specified in the first recital of
this Indenture.
"Common Stock" means the common stock, par value $2.50 per share, of
the Company.
"Company" means the Person named as the "Company" in the first
paragraph of this Indenture until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
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<PAGE> 11
"Company Request" and "Company Order" mean, respectively, the written
request or order signed in the name of the Company by the Chairman of the Board
of Directors, the 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 of the Company, and delivered to the Trustee.
"Corporate Trust Office" means the principal office of the Trustee at
which at any particular time its corporate trust business shall be administered,
which at the date hereof is 101 Barclay Street, Floor 21 West, New York, New
York 10286.
"Corporation" includes a corporation, association, company, joint-stock
company or business trust.
"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, (i) every
obligation of such Person for money borrowed; (ii) every obligation of such
Person evidenced by bonds, debentures, notes or other similar instruments,
including obligations incurred in connection with the acquisition of property,
assets or businesses; (iii) every reimbursement obligation of such Person with
respect to letters of credit, bankers' acceptances or similar facilities issued
for the account of such Person; (iv) every obligation of such Person issued or
assumed as the deferred purchase price of property or services (but excluding
trade accounts payable or accrued liabilities arising in the ordinary course of
business); (v) every capital lease obligation of such Person; (vi) every
obligation of such Person for claims 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 3.7.
"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 Company pursuant to
Section 3.1 with respect to such series (or any successor thereto).
"Discount Security" means any security which 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 a
Trust, means amounts payable in respect of such Trust
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<PAGE> 12
Securities as provided in the related Trust Agreement and referred to therein as
"Distributions."
"Dollar" 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 in the supplemental
indenture creating a series of Securities has the meaning specified in Article
V.
"Exchange Act" means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time.
"Expiration Date" has the meaning specified in Section 1.4(f).
"Extension Period" has the meaning specified in Section 3.11.
"Federal Reserve" means the Board of Governors of the Federal Reserve
System, as from time to time constituted, or if at any time after the execution
of this Indenture the Federal Reserve is not existing and performing the duties
now assigned to it, then the body performing such duties at such time.
"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", with respect to the Trust Securities issued by a Trust,
means the guarantee by the Company of Distributions on such Trust Securities to
the extent provided in the Guarantee Agreement.
"Guarantee Agreement", with respect to the Trust Securities issued by a
Trust, means the Guarantee Agreement substantially in the form attached hereto
as Annex C, or substantially in such form as may be specified as contemplated by
Section 3.1 with respect to the Securities of any series, in each case as
amended 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.
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<PAGE> 13
"Interest Payment Date" means as to each series of Securities the
Stated Maturity of an installment of interest on such Securities.
"Junior Subordinated Payment" has the meaning specified in Section
13.2.
"Maturity" when used with respect to any Security means the date on
which the principal of such Security becomes due and payable as therein or
herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption or otherwise.
"Moody's" means Moody's Investors Service, Inc.
"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 of Directors , a Vice Chairman of the Board of Directors, the
President or a Vice President, and by the Treasurer, an Assistant Treasurer, the
Secretary or an Assistant Secretary of the Company, and delivered to the
Trustee.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company, and who shall be acceptable to the Trustee.
"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 or redemption price 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 which have been paid
pursuant to Section 3.6, 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 Company;
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
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<PAGE> 14
waiver hereunder, Securities owned by the Company or any other obligor upon the
Securities or any Affiliate of the Company 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 which a
Responsible Officer of the Trustee actually knows to be so owned shall be so
disregarded. Securities so owned which 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 Company or any other obligor upon the Securities or any
Affiliate of the Company or such other obligor. Upon the written request of the
Trustee, the Company shall furnish to the Trustee promptly an Officers'
Certificate listing and identifying all Securities, if any, known by the Company
to be owned or held by or for the account of the Company or any other obligor on
the Securities or any Affiliate of the Company 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.
"Paying Agent" means the Trustee or any Person authorized by the
Company to pay the principal of (or premium, if any) or interest on any
Securities on behalf of the Company.
"Person" means any individual, corporation, partnership, joint venture,
trust, unincorporated organization or government or any agency or political
subdivision thereof.
"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 Sections 3.1 and 3.11.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 3.6 in lieu of a lost, destroyed or
stolen Security shall be deemed to evidence the same debt as the lost, destroyed
or stolen Security.
"Preferred Securities" has the meaning specified in the first recital
of this Indenture.
"Proceeding" has the meaning specified in Section 13.2.
"Property Trustee" means, in respect of any Trust, the commercial bank
or trust company identified as the "Property Trustee" in the related Trust
Agreement, solely in its capacity as Property Trustee of such Trust under such
Trust Agreement and
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<PAGE> 15
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.
"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 a series, (i) in the case
of Securities of a series represented by one or more Global Securities, the
Business Day next preceding such Interest Payment Date and (ii) in the case of
Securities of a series not represented by one or more Global Securities, the
date which 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 of the Trustee assigned by the Trustee from time to time to administer
its corporate trust matters.
"Rights Plan" means a plan of the Company providing for the issuance by
the Company to all holders of its Common Stock of rights entitling the holders
thereof to subscribe for or purchase shares of Common Stock or any class or
series of preferred stock of the Company, which rights (i) are deemed to be
transferred with such shares of Common Stock, (ii) are not exercisable and (iii)
are also issued in respect of future issuances of Common Stock, in each case
until the occurrence of a specified event or events.
"S&P" means Standard & Poor's Ratings Services.
"Securities" or "Security" means any debt securities or debt security,
as the case may be, authenticated and delivered under this Indenture.
"Securities Register" and "Securities Registrar" have the respective
meanings specified in Section 3.5.
"Senior Debt" 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 Company whether or
not such claim for post-petition interest is allowed in such proceeding), on
Debt of the Company, 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
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<PAGE> 16
outstanding, it is provided that such obligations are not superior in right of
payment to the Securities or to other Debt which is pari passu with, or
subordinated to, the Securities, provided, however, that Senior Debt shall not
be deemed to include (a) any Debt of the Company which, when incurred and
without respect to any election under Section 1111(b) of the Bankruptcy Reform
Act of 1978, was without recourse to the Company, (b) any Debt of the Company to
any of its Subsidiaries, (c) Debt to any employee of the Company, (d) Debt which
by its terms is subordinated to trade accounts payable or accrued liabilities
arising in the ordinary course of business to the extent that payments made to
the holders of such Debt by the holders of the Securities as a result of the
subordination provisions of this Indenture would be greater than such payments
otherwise would have been (absent giving effect to this clause (d)) as a result
of any obligation of such holders of such Debt to pay amounts over to the
obligees on such trade accounts payable or accrued liabilities arising in the
ordinary course of business as a result of subordination provisions to which
such Debt is subject, and (e) any Securities.
"Special Record Date" for the payment of any Defaulted Interest means a
date fixed by the Trustee pursuant to Section 3.7.
"Stated Maturity" when used with respect to any Security or any
installment of principal thereof or interest thereon means the date specified
pursuant to the terms of such Security as the date on which the principal of
such Security or such installment of interest is due and payable, in the case of
such principal, as such date may be shortened or extended as provided pursuant
to the terms of such Security and this Indenture.
"Subsidiary" means a corporation more than 50% of the outstanding
voting stock of which is owned, directly or indirectly, by the Company or by one
or more other Subsidiaries, or by the Company and one or more other
Subsidiaries. For purposes of this definition, "voting stock" means stock which
ordinarily has voting power for the election of directors, whether at all times
or only so long as no senior class of stock has such voting power by reason of
any contingency.
"Tax Event", with respect to a Trust, means the receipt by such 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 any amendment to,
or change (including any announced proposed change) in, the laws (or any
regulations thereunder) of the United States or any political subdivision or
taxing authority thereof or therein, or as a result of any official
administrative pronouncement or judicial decision interpreting or applying such
laws or regulations, which amendment or change is effective or which proposed
change, pronouncement or decision is announced on or after the date of issuance
of the Preferred Securities of such Trust, there is more
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<PAGE> 17
than an insubstantial risk that (i) such Trust is, or will be within 90 days of
the date of such Opinion of Counsel, subject to United States federal income tax
with respect to income received or accrued on the corresponding series of
Securities issued by the Company to such Trust, (ii) interest payable by the
Company on such corresponding series of Securities is not, or within 90 days of
the date of such Opinion of Counsel, will not be, deductible by the Company, in
whole or in part, for United States federal income tax purposes or (iii) such
Trust is, or will be within 90 days of the date of such Opinion of Counsel,
subject to more than a de minimis amount of other taxes, duties or other
governmental charges.
"Trust" has the meaning specified in the first recital of this
Indenture.
"Trust Agreement", with respect to a Trust, means a Trust Agreement
substantially in the form attached hereto as Annex A, as amended by the form of
Amended and Restated Trust Agreement substantially in the form attached hereto
as Annex B, or substantially in such form as may be specified as contemplated by
Section 3.1 with respect to the Securities of any series, in each case as
amended from time to time.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument 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.
Section 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 Company 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 Company to the Trustee to take
any action under any provision of this Indenture, the Company 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
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<PAGE> 18
the opinion of such counsel all such conditions precedent (including covenants
compliance with which constitute 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 10.5) shall include:
(1) a statement that each individual signing such certificate or
opinion 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 contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he has
made or caused to be made such examination or investigation as is necessary to
enable him 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 each 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 Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer or counsel knows, or in the
exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which his or her certificate or
opinion is based are erroneous. Any Opinion of Counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
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<PAGE> 19
Company, unless such counsel rendering such Opinion of 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 or
proxy 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 Company. Such instrument or instruments (and the action embodied therein
and evidenced thereby) are herein sometimes referred to as the "Act" of the
Holders signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent or proxy shall be
sufficient for any purpose of this Indenture and (subject to Section 6.1)
conclusive in favor of the Trustee and the Company, if made in the manner
provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by 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 the execution thereof. Where such
execution is by a Person acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his 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 which 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,
12
<PAGE> 20
omitted or suffered to be done by the Trustee or the Company in reliance
thereon, whether or not notation of such action is made upon such Security.
(f) The Company may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities 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 Company 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 paragraph. If any record date is set pursuant
to this paragraph, the Holders of the relevant Outstanding Securities 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 by Holders of the requisite principal
amount of the relevant Outstanding Securities on such record date. Nothing in
this paragraph shall be construed to prevent the Company 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 the relevant
Outstanding Securities on the date such action is taken. Promptly after any
record date is set pursuant to this paragraph, the Company, 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 the relevant Securities 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 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 with respect to the relevant Securities. If any record date is set pursuant
to this paragraph, the Holders of the relevant Outstanding Securities 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 the relevant Outstanding Securities 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
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<PAGE> 21
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 the relevant Outstanding Securities on the date such action is taken.
Promptly after any record date is set pursuant to this paragraph, the Trustee,
at the Company's expense, shall cause notice of such record date, the proposed
action by Holders and the applicable Expiration Date to be given to the Company
in writing and to each Holder of the relevant Securities in the manner set forth
in Section 1.6.
With respect to any record date set pursuant to this Section, the party
hereto which sets such record dates 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 the relevant Outstanding Securities in the manner set forth in
Section 10.6, 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 which 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 Company.
Any request, demand, authorization, direction, notice, consent, waiver
or Act of Holders or other document provided or permitted by this Indenture to
be made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder, any holder of Preferred Securities or
the Company shall be sufficient for every purpose hereunder if made, given,
furnished or filed in writing to or with the Trustee at its Corporate Trust
Office, or
(2) the Company by the Trustee, any Holder or any holder of Preferred
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 Company
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addressed to it at the address of its principal office specified in the first
paragraph of this instrument or at any other address previously furnished in
writing to the Trustee by the Company.
Section 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. 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.
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 Company shall
bind its successors and assigns, whether so expressed or not.
Section 1.10. Separability Clause.
In case any provision of this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
Section 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
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<PAGE> 23
and their successors and assigns, the holders of Senior Debt, the Holders of the
Securities and, to the extent expressly provided in Sections 5.2, 5.8, 5.9,
5.11, 5.13, 9.1 and 9.2, the holders of Preferred 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, WITHOUT REGARD TO CONFLICTS
OF LAW PRINCIPLES THEREOF.
Section 1.13. Non-Business Days.
In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Security shall not be a Business Day, then (notwithstanding any
other provision of this Indenture or the Securities) payment of interest or
principal (and premium, if any) need not be made on such date, but may be made
on the next succeeding Business Day (and no interest shall accrue 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 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 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 automated quotation system on which the Securities may be
listed or traded 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 Company and
delivered to the Trustee at or prior to the delivery of the Company Order
contemplated by Section 3.3
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<PAGE> 24
with respect to the authentication and delivery of such Securities.
The Trustee's certificates of authentication shall be substantially in
the form set forth in this Article.
The definitive Securities shall be typewritten, printed, lithographed
or engraved or produced by any combination of these methods, if required by any
securities exchange or automated quotation system on which the Securities may be
listed or traded, 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
or automated quotation system on which the Securities may be listed or traded,
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.
USBANCORP, INC. CUSIP ____
__% JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES
No. $
USBANCORP, INC., a corporation organized and existing under the laws of
the Commonwealth of Pennsylvania (hereinafter called the "Company", which term
includes any successor corporation under the Indenture hereinafter referred to),
for value received, hereby promises to pay to _____________________, or
registered assigns, the principal sum of _____________________ Dollars on
__________ __, ____[; provided that the Company may, subject to certain
conditions set forth in Section 3.14 of the Indenture, (i) shorten the Stated
Maturity of the principal of this Security to a date not earlier than
__________, and (ii) extend the Stated Maturity of the principal of this
Security at any time on one or more occasions, but in no event to a date later
than __________]. The Company further promises to pay interest on said principal
sum from _____________________ , _____________________ or from the most recent
interest payment date (each such date, an "Interest Payment Date") on which
interest has been paid or duly provided for, [monthly] [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, until the principal hereof shall have become due and payable, [if
applicable, insert plus Additional Interest, if any,] until the principal hereof
is paid or duly provided for or made available for payment [if applicable,
insert and on any overdue principal and (without duplication and to the extent
that payment of such interest is enforceable under applicable law) on any
overdue installment of interest at the rate of _____% per annum, compounded
[monthly] [quarterly] [semi-annually]. The amount of interest payable for any
period shall be computed on the basis of twelve 30-day months and a 360-day
year. The amount of interest payable for any partial period shall be
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<PAGE> 25
computed on the basis of the number of days elapsed in a 360-day year of twelve
30-day months. In the event that any date on which interest is payable on this
Security is not a Business Day, then a payment of the interest payable on such
date will be made on the next succeeding day which is a Business Day (and
without any interest or other payment in respect of any such delay), except
that, if such Business Day is 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 the payment was originally payable.
A "Business Day" shall mean 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 [if applicable, insert, or the principal
corporate trust office of the Property Trustee under the Trust Agreement
hereinafter referred to for USBANCORP Capital ____,] is closed for business. The
interest installment so payable, and punctually paid or duly provided for, on
any Interest Payment Date will, as provided in the Indenture, be paid to the
Person in whose name this Security (or one or more Predecessor Securities is
registered at the close of business on the Regular Record Date for such interest
installment, which shall be the [insert definition of Regular Record Dates]. Any
such interest installment not so punctually paid or duly provided for shall
forthwith cease to be payable to the Holder on such Regular Record Date and may
either be paid to the Person in whose name 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 or automated quotation system on which the Securities of
this series may be listed or traded, and upon such notice as may be required by
such exchange or self-regulatory organization, all as more fully provided in
said Indenture.
[If applicable, insert - So long as no Event of Default has occurred
and is continuing, the Company shall have the right at any time during the term
of this Security to defer payment of interest on this Security, at any time or
from time to time, for up to _____ consecutive [monthly] [quarterly]
[semi-annual] interest payment periods with respect to each deferral period
(each an "Extension Period"), during which Extension Periods the Company shall
have the right to make partial payments of interest on any Interest Payment
Date, and at the end of which the Company shall pay all interest then accrued
and unpaid (together with Additional Interest thereon to the extent permitted by
applicable law); provided, however, that no Extension Period shall extend beyond
the Stated Maturity of the principal of this Security; provided, further, that
during any such Extension Period, the Company shall not, and shall not permit
any Subsidiary of the Company to, (i) declare or pay any dividends or
distributions on or redeem, purchase, acquire or make a liquidation
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<PAGE> 26
payment with respect to, any of the Company'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 security of the Company that ranks pari passu with or junior
in interest to this Security or (iii) make any guarantee payments with respect
to any guarantee by the Company of the debt securities of any Subsidiary of the
Company if such guarantee ranks pari passu with or junior in interest to this
Security (other than (a) dividends or distributions in the Company's capital
stock, (b) any declaration of a dividend in connection with the implementation
of a Rights Plan or the redemption or repurchase of any rights distributed
pursuant to a Rights Plan, (c) payments under the Guarantee with respect to this
Security, and (d) purchases of Common Stock related to the issuance of Common
Stock or rights under any of the Company's benefit plans for its directors,
officers or employees, related to the issuance of Common Stock or rights under a
dividend reinvestment and stock purchase plan, or related to the issuance of
Common Stock (or securities convertible or exchangeable for Common Stock) as
consideration in an acquisition transaction that was entered into prior to the
commencement of such Extension Period). Prior to the termination of any such
Extension Period, the Company may further defer the payment of interest,
provided that no Extension Period shall exceed __ consecutive [months]
[quarters] [semi-annual] periods or extend beyond the Stated Maturity of the
principal of this Security. Upon the termination of any such Extension Period
and upon the payment of all accrued and unpaid interest and any Additional
Interest then due, the Company may elect to begin a new Extension Period,
subject to the above requirements. No interest shall be due and payable during
an Extension Period except at the end thereof. The Company shall give the 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, with respect to the Securities issued to a Trust,
so long as such Securities are held by such Trust, prior to the earlier of (i)
the next succeeding date on which Distributions on the Preferred Securities
would be payable but for such deferral or (ii) the date the Administrative
Trustees are required to give notice to any securities exchange or other
applicable self-regulatory organization or to holders of such Preferred
Securities of the record date or the date such Distributions are payable, but in
any event not less than one Business Day prior to such record date]].
Payment of principal of (and premium, if any) and interest on this
Security will be made at the office or agency of the Company maintained for that
purpose in the United States, in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts [if applicable, insert -; provided, however, that at the option of
the Company payment of interest may be made (i) by check mailed to the address
of the Person entitled thereto as such address shall appear in the Securities
Register or (ii) by wire transfer in immediately
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<PAGE> 27
available funds at such place and to such account as may be designated in
writing at least 15 days before the relevant Interest Payment Date 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 subject in right of payments to the prior
payment in full of all Senior Debt, and this Security is issued subject to the
provisions of the Indenture with respect thereto. Each Holder of this Security,
by accepting the same, (a) agrees to and shall be bound by such provisions, (b)
authorizes and directs the Trustee on his behalf to take such actions as may be
necessary or appropriate to effectuate the subordination so provided and (c)
appoints the Trustee his attorney-in-fact for any and all such purposes. Each
Holder hereof, by his acceptance hereof, waives all notice of the acceptance of
the subordination provisions contained herein and in the Indenture by each
holder of Senior Debt, 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 Company has caused this instrument to be duly
executed under its corporate seal.
USBANCORP, INC.
By:_______________________________
[President or Vice President]
Attest:
__________________________________
[Secretary or Assistant Secretary]
Section 2.3. Form of Reverse of Security.
This Security is one of a duly authorized issue of securities of the
Company (herein called the "Securities"), issued and to be issued in one or more
series under a Junior Subordinated Indenture, dated as of April 1, 1998 (herein
called the "Indenture"), between the Company and The Bank of New York, 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
20
<PAGE> 28
rights, limitations of rights, duties and immunities thereunder of the Trustee,
the Company and the Holders of the Securities, and of the terms upon which the
Securities are, and are to be, authenticated and delivered. This Security is one
of the series designated on the face hereof [, 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
_____________, 1998, as amended (the "Trust Agreement"), for [USBANCORP Capital
_____________,] among USBANCORP, Inc., as Depositor, and the Trustees named
therein, 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 Company 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, without premium or penalty, at a redemption price equal to 100% of the
principal amount thereof plus accrued and unpaid interest [if applicable, insert
- -including Additional Interest, if any] to the Redemption Date.]
[If applicable, insert -Upon the occurrence and during the continuation
of a Tax Event or a Capital Treatment Event in respect of a Trust, the Company
may, at its option, at any time within 90 days of the occurrence of such Tax
Event or Capital Treatment Event redeem this Security, in whole but not in part,
subject to the provisions of Section 11.7 and the other provisions of Article XI
of the Indenture, at a redemption price equal to 100% of the principal amount
thereof plus accrued and unpaid interest, including Additional Interest, if any,
to the Redemption Date.]
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 Company with certain
conditions set forth in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the
Company 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 Company 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 all 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 all series at the time Outstanding, on
behalf of the
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<PAGE> 29
Holders of all Securities of such series, to waive compliance by the Company
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 hereof 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, -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 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 Company (and to the Trustee
if given by Holders), provided that, in the case of the Securities of this
series issued to a 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 this series fails to declare the principal of all the Securities of this
series to be immediately due and payable, the holders of at least 25% in
aggregate Liquidation Amount of the Preferred Securities then outstanding shall
have such right by a notice in writing to the Company 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.]
[If the Security is a Discount Security, -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 such portion
of the principal amount as may be specified in the terms of this series may
declare an amount of principal of the Securities of this series to be due and
payable immediately, by a notice in writing to the Company (and to the Trustee
if given by Holders), provided that, in the case of the Securities of this
series issued to a 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 this series fails to declare the principal of all the Securities of this
series to be immediately due and payable, the holders of at least 25% in
aggregate Liquidation Amount of the Preferred Securities then outstanding shall
have such right by a notice in writing to the Company and the Trustee. Such
amount shall be equal to insert formula for determining the amount. Upon any
such declaration, such amount of the principal of and the accrued interest
(including any Additional Interest) on all the Securities
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<PAGE> 30
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. Upon payment (i) of the amount of principal so declared due and
payable and (ii) of interest on any overdue principal and overdue interest (in
each case to the extent that the payment of such interest shall be legally
enforceable), all of the Company's obligations in respect of the payment of the
principal of and interest, if any, on this Security shall terminate.]
No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Company, which
is absolute and unconditional, to pay the principal of (and premium, if any) and
interest on this Security at the times, place and rate, and in the coin or
currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Security is registrable in the Securities
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company maintained under Section 10.2 of the Indenture
duly endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Company and the Securities Registrar duly executed by, the
Holder hereof or his attorney duly authorized in writing, and thereupon one or
more new Securities of this series, of authorized denominations and for the same
aggregate principal amount, will be issued to the designated transferee or
transferees. No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name this Security is registered as the owner hereof for all
purposes, whether or not this Security be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
The Securities of this series are issuable only in registered form
without coupons in denominations of $_____________ and any integral multiple
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 such series of a different authorized
denomination, as requested by the Holder surrendering the same.
The Company 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.
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<PAGE> 31
No recourse shall be had for the payment of the principal of or
premium, if any, or interest on this Security, or for any claim based hereon, or
otherwise in respect hereof, or based on or in respect of the Indenture, against
any incorporator, stockholder, officer or director, past, present or future, as
such, of the Company or of any predecessor or successor Person, whether by
virtue of any constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise, all such liability being, by the acceptance
hereof and as part of the consideration for the issuance hereof, expressly
waived and released.
THE INDENTURE AND THIS SECURITY SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF
LAWS PRINCIPLES THEREOF.
Section 2.4. Additional Provisions Required in Global Security.
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."
Section 2.5. Form of Trustee's Certificate of Authentication.
This is one of the Securities referred to in the within mentioned
Indenture.
Dated:
THE BANK OF NEW YORK
as Trustee
By:_______________________________
Authorized Signatory
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ARTICLE III
THE SECURITIES
Section 3.1. Title and Terms.
The aggregate principal amount of Securities which may be authenticated
and delivered under this Indenture is unlimited.
The Securities may be issued from time to time in one or more series.
The following matters shall be established in or pursuant to a Board Resolution,
and set forth 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 which 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, 3.5, 3.6, 9.6 or 11.6 and except for any
Securities which, pursuant to the last paragraph of 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 Stated Maturity or Maturities on which the principal of the
Securities of such series is payable or the method of determination thereof;
(d) 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 Interest Payment Dates on which such interest shall be payable, the right,
pursuant to Section 3.11 or as otherwise set forth therein, of the Company 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;
(e) the place or places where the principal of (and premium, if any)
and 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, and the place or places where notices and demands to or
upon the Company in respect of the Securities of such series may be made;
(f) the period or periods within which, or the date or dates on which,
if any, the price or prices at which and the terms and
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conditions upon which the Securities of such series may be redeemed, in whole or
in part, at the option of the Company;
(g) the obligation or the right, if any, of the Company to redeem,
repay or purchase the Securities of such series pursuant to any sinking fund,
amortization or analogous provisions or upon the happening of a specified event,
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;
(h) the denominations in which any Securities of such series shall be
issuable, if other than denominations of $25 and any integral multiple thereof;
(i) if other than Dollars, the currency or currencies (including
currency unit or units) in which the principal of (and premium, if any) and
interest, if any, on the Securities of the series shall be payable, or in which
the Securities of the series shall be denominated;
(j) the additions, modifications or deletions, if any, in the Events of
Default or covenants of the Company set forth herein with respect to the
Securities of such series;
(k) 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;
(l) 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;
(m) 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;
(n) whether the Securities of the series, or any portion thereof, shall
initially be issuable in the form of a temporary Global Security representing
all or such portion of the Securities of such series and provisions for the
exchange of such temporary Global Security for definitive Securities of such
series;
(o) 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 which 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 3.5 in which any such Global
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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;
(p) the appointment of any Paying Agent or Agents for the Securities of
such series;
(q) the terms of any right to convert or exchange Securities of such
series into any other securities or property of the Company, 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;
(r) the form or forms of the Trust Agreement, Amended and Restated
Trust Agreement and Guarantee Agreement, if different from the forms attached
hereto as Annexes A, B and C, respectively;
(s) 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; and
(t) any other terms of the Securities of such series (which terms shall
not be inconsistent with the provisions of this Indenture).
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 in such Officers' Certificate
or in any such indenture supplemental hereto.
If any of the terms of the Securities of any 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
Company 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 Debt
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 and any integral multiple
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 Company by its
President or one of its Vice Presidents under its corporate
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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 Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities. At any time and from time to
time after the execution and delivery of this Indenture, the Company may deliver
Securities of any series executed by the Company to the Trustee for
authentication, together with a Company Order for the authentication and
delivery of such Securities, and the Trustee in accordance with the Company
Order shall authenticate and make such Securities available for delivery. 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 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;
(3) that such Securities, when authenticated and delivered by
the Trustee and issued by the Company in the manner and subject to any
conditions specified in such Opinion of Counsel, will constitute valid
and legally binding obligations of the Company enforceable in
accordance with their 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; and
(4) that all laws and requirements in respect of the execution
and delivery by the Company of such Securities have been complied with.
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 or
immunities under the Securities and this Indenture or otherwise in a manner
which is not reasonably acceptable to the Trustee.
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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 Company 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
signatories, 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
Company, and the Company shall deliver such Security to the Trustee for
cancellation as provided in Section 3.9, for all purposes of this Indenture such
Security shall be deemed never to have been authenticated and delivered
hereunder and shall not be entitled to the benefits of this Indenture.
Section 3.4. Temporary Securities.
Pending the preparation of definitive Securities of any series, the
Company may execute, and upon Company Order the Trustee shall authenticate and
make available for delivery, temporary Securities which are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any authorized
denomination, substantially of the tenor of the definitive Securities of such
series in lieu of which they are issued and with such appropriate insertions,
omissions, substitutions and other variations as the officers executing such
Securities may determine, as evidenced by their execution of such Securities.
If temporary Securities of any series are issued, the Company 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 Company designated for that purpose
without charge to the Holder. Upon surrender for cancellation of any one or more
temporary Securities, the Company shall execute and the Trustee shall
authenticate and make available for delivery in exchange therefor 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
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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. Registration, Transfer and Exchange.
The Company 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 Company 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
office or agency of the Company designated for that purpose the Company shall
execute, and the Trustee shall authenticate and make available for delivery, in
the name of the designated transferee or transferees, one or more new Securities
of the same series of any authorized denominations, of a like aggregate
principal amount, of the same Original Issue Date and Stated Maturity and having
the same terms.
At the option of the Holder, Securities may be exchanged for other
Securities of the same series of any authorized denominations, of a like
aggregate principal amount, of the same Original Issue Date and Stated Maturity
and having the same terms, upon surrender of the Securities to be exchanged at
such office or agency. Whenever any Securities are so surrendered for exchange,
the Company shall execute, and the Trustee shall authenticate and make available
for delivery, the Securities which the Holder making the exchange is entitled to
receive.
All Securities issued upon any transfer or exchange of Securities shall
be the valid obligations of the Company, evidencing the same debt, and entitled
to the same benefits under this Indenture, as the Securities surrendered upon
such transfer or exchange.
Every Security presented or surrendered for transfer or exchange shall
(if so required by the Company or the Securities Registrar) be duly endorsed, or
be accompanied by a written instrument of transfer in form satisfactory to the
Company and the Securities Registrar, duly executed by the Holder thereof or his
attorney duly authorized in writing.
No service charge shall be made to a Holder for any transfer or
exchange of Securities, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
with any transfer or exchange of Securities.
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The provisions of Clauses (1), (2), (3) and (4) below shall apply only
to Global Securities:
(1) Each Global Security authenticated under this Indenture
shall be registered in the name of the Depositary designated 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.
(2) 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 (A) such
Depositary (i) has notified the Company that it is unwilling or unable
to continue as Depositary for such Global Security or (ii) has ceased
to be a clearing agency registered under the Exchange Act at a time
when the Depositary is required to be so registered to act as
depositary, in either case unless the Company has approved a successor
Depositary within 90 days, (B) there shall have occurred and be
continuing an Event of Default with respect to such Global Security,
(C) the Company in its sole discretion determines that such Global
Security will be so exchangeable or transferable or (D) there shall
exist such circumstances, if any, in addition to or in lieu of the
foregoing as have been specified for this purpose as contemplated by
Section 3.1.
(3) Subject to Clause (2) above, any exchange of a Global
Security for other Securities may be made in whole or in part, and all
Securities issued in exchange for a Global Security or any portion
thereof shall be registered in such names as the Depositary for such
Global Security shall direct.
(4) 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 Section,
Section 3.4, 3.6, 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.
Neither the Company nor the Trustee shall be required, pursuant to the
provisions of this Section, (a) to issue, transfer 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 pursuant to Article XI and
ending at the close of business on the day of mailing of notice of redemption or
(b) to transfer or exchange any Security so selected for redemption in whole or
in part, except, in the case of any Security to be redeemed in part, any portion
thereof not to be redeemed.
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Section 3.6. 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 Company or the Trustee to
save each of them harmless, the Company shall execute and the Trustee shall
authenticate and make available for delivery in exchange therefor a new Security
of the same issue and series of like tenor and principal amount, having the same
Original Issue Date and Stated Maturity and bearing the same interest rate as
such mutilated Security, and bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company 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 Company or the
Trustee that such Security has been acquired by a bona fide purchaser, the
Company shall execute and upon its request the Trustee shall authenticate and
make available for delivery, in lieu of any such destroyed, lost or stolen
Security, a new Security of the same issue and series of like tenor and
principal amount, having the same Original Issue Date and Stated Maturity and
bearing the same interest rate as such destroyed, lost or stolen Security, and
bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the Company
may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Security issued pursuant to this Section in lieu of any
destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities of that 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.
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Section 3.7. Payment of Interest; Interest Rights Preserved.
Interest on any Security of any series which is payable, and is
punctually paid or duly provided for, on any Interest Payment Date, shall be
paid to the Person in whose name that Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest in respect of Securities of such series, except that, unless
otherwise provided in the Securities of such series, 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 which 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. At the option of the Company, interest on any series of Securities
may be paid (i) by check mailed to the address of the Person entitled thereto as
it shall appear on the Securities Register of such series or (ii) by wire
transfer in immediately available funds at such place and to such account as
designated by the Person entitled thereto as specified in the Securities
Register of such series.
Any interest on any Security which is 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 Company, at its
election in each case, as provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted Interest to
the Persons in whose names the Securities 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
Company shall notify the Trustee in writing of the amount of Defaulted Interest
proposed to be paid on each Security and the date of the proposed payment, and
at the same time the Company shall deposit with the Trustee an amount of money
equal to the aggregate amount proposed to be paid in respect of such Defaulted
Interest or shall make arrangements satisfactory to the Trustee for such deposit
prior to the date of the proposed payment, such money when deposited to be held
in trust for the benefit of the Persons entitled to such Defaulted Interest as
in this Clause provided. Thereupon the Trustee shall fix a Special Record Date
for the payment of such Defaulted Interest which shall be not more than 15 days
and not less than 10 days prior to the date of the proposed payment and not less
than 10 days after the receipt by the Trustee of the notice of the proposed
payment. The Trustee shall promptly notify the Company of such Special Record
Date and, in the name and at the expense of the Company, shall cause notice of
the proposed payment of such Defaulted Interest and the Special Record Date
therefor to be mailed, first class, postage prepaid, to each Holder
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of a Security of such series at the address of 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 Company,
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 Company may make payment of any Defaulted Interest in any other
lawful manner not inconsistent with the requirements of any securities exchange
or automated quotation system on which the Securities of the series in respect
of which interest is in default may be listed or traded 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 Company to the Trustee of the proposed
payment pursuant to this Clause, such payment shall be deemed practicable by the
Trustee.
Any interest on any Security which is deferred or extended pursuant to
Section 3.11 shall not be Defaulted Interest for the purposes of this Section
3.7.
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, which were carried by such other Security.
Section 3.8. Persons Deemed Owners.
The Company, the Trustee and any agent of the Company or the Trustee
may 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 3.7) any interest on such Security and for all other purposes
whatsoever, whether or not such Security be overdue, and neither the Company,
the Trustee nor any agent of the Company or the Trustee shall be affected by
notice to the contrary.
Section 3.9. 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 Company may at any time
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deliver to the Trustee for cancellation any Securities previously authenticated
and delivered hereunder which the Company may have acquired in any manner
whatsoever, and all Securities so delivered shall be promptly canceled by the
Trustee. No Securities 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 returned by the Trustee to
the Company and destroyed by the Company.
Section 3.10. 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
period shall be computed on the basis of a 360-day year of twelve 30-day months
and interest on the Securities of each series for any partial period shall be
computed on the basis of the number of days elapsed in a 360-day year of twelve
30-day months.
Section 3.11. Deferral 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 Company 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
Company shall 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 Company 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) to the Persons in whose
names that Securities are registered at the close of business on the Regular
Record Date with respect to the Interest Payment Date at the end of such
Extension Period; provided, however, that no Extension Period shall extend
beyond the Stated Maturity of the principal of the Securities of such series;
provided, further, that during any such Extension Period, the Company shall not,
and shall not permit any Subsidiary to, (i) declare or pay any dividends or
distributions on, or redeem, purchase, acquire or make a liquidation payment
with respect to, any of the Company's capital stock, (ii) make any payment of
principal of or interest or premium, if any, on or repay, repurchase or redeem
any debt security of the Company that ranks pari passu with or junior in
interest to the Securities of such series or (iii) make any guarantee payments
with respect to any guarantee by the Company of the debt securities of any
Subsidiary of the Company that by their terms rank pari passu with or junior in
interest to the securities of such series (other than (a) dividends or
distributions in the Company's capital stock, (b) any declaration of a dividend
in connection with the implementation of a Rights Plan, or the redemption or
repurchase of any rights
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distributed pursuant to a Rights Plan, (c) payments under the Guarantee with
respect to such Security, and (d) purchases of Common Stock related to the
issuance of Common Stock or rights under any of the Company's benefit plans for
its directors, officers or employees, related to the issuance of Common Stock or
rights under a dividend reinvestment and stock purchase plan, or related to the
issuance of Common Stock (or securities convertible or exchangeable for Common
Stock) as consideration in an acquisition transaction that was entered into
prior to the commencement of such Extension Period). Prior to the termination of
any such Extension Period, the Company may further defer the payment of
interest, provided that no Extension Period shall exceed the period or periods
specified in such Securities or extend beyond the Stated Maturity of the
principal of such Securities. Upon termination of any Extension Period and upon
the payment of all accrued and unpaid interest and any Additional Interest then
due on any Interest Payment Date, the Company may elect to begin a new Extension
Period, subject to the above requirements. No interest shall be due and payable
during an Extension Period, except at the end thereof. The Company shall give
the 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 the
Securities of a series issued to a Trust, so long as such Securities are held by
such Trust, prior to the earlier of (i) the next succeeding date on which
Distributions on the Preferred Securities of such Trust would be payable but for
such deferral or (ii) the date the Administrative Trustees of such Trust are
required to give notice to any securities exchange or other applicable
self-regulatory organization or to holders of such Preferred Securities of the
record date for the date such Distributions are payable, but in any event not
less than one Business Day prior to such record date.
The Trustee shall promptly give notice, in the name and at the expense
of the Company, of the Company's election to begin any such Extension Period to
the Holders of the Outstanding Securities of such series.
Section 3.12. Right of Set-Off.
With respect to the Securities of a series issued to a Trust,
notwithstanding anything to the contrary in the Indenture, the Company shall
have the right to set-off any payment it is otherwise required to make
thereunder in respect of any such Security to the extent the Company has
theretofore made, or is concurrently on the date of such payment making, a
payment under the Guarantee relating to such Security or under Section 5.8 of
the Indenture.
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Section 3.13. Agreed Tax Treatment.
Each Security issued hereunder shall provide that the Company and, by
its acceptance of a Security or a beneficial interest therein, the Holder of,
and any Person that acquires a beneficial interest in, such Security intend that
such Security constitutes indebtedness and agree to treat such Security as
indebtedness for United States federal, local and state tax purposes.
Section 3.14. Shortening or Extension 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 Company shall have the right to
(i) 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
Company has the right to redeem the Securities of such series, and (ii) extend
the Stated Maturity of the principal of the Securities of such series at any
time at its election for one or more periods, but in no event to a date later
than the 49th anniversary of the Original Issue Date of the Securities of such
series; provided that, if the Company elects to exercise its right to extend the
Stated Maturity of the principal of the Securities of such series pursuant to
clause (ii), above, at the time such election is made and at the time of
extension (A) the Company is not in bankruptcy, otherwise insolvent or in
liquidation, (B) the Company is not in default in the payment of any interest or
principal on such Securities, (C) in the case of any series of Securities held
by a Trust, such Trust is not in arrears on payments of Distributions on the
Preferred Securities issued by such Trust and no deferred Distributions are
accumulated and (D) such Securities are rated not less than BBB- by S&P or Baa3
by Moody's or the equivalent by any other nationally recognized statistical
rating organization. In the event the Company elects to shorten or extend the
Stated Maturity of the Series A Subordinated Debentures, it shall give written
notice to the Trustee, and the Trustee shall give notice of such shortening or
extension to the Holders, no less than 30 and no more than 60 days prior to the
effectiveness thereof. The Company's right to shorten the Stated Maturity of the
principal of the Securities of such series pursuant to clause (i) above is
subject to the Company having received prior approval of the Federal Reserve if
required under applicable capital guidelines or policies.
Section 3.15. CUSIP Numbers.
The Company in issuing the Securities may use "CUSIP" numbers (if then
generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption as a convenience to Holders; provided that any such notice may
state that no representation is made as to the correctness of such numbers
either as printed on the Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Securities, and any such redemption shall not be affected
by any defect in or omission of
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such numbers. The Company will promptly notify the Trustee of any change in the
CUSIP numbers.
ARTICLE IV
SATISFACTION AND DISCHARGE
Section 4.1. Satisfaction and Discharge of Indenture.
This Indenture shall, upon Company 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
Company, 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 which have been destroyed, lost or stolen and which
have been replaced or paid as provided in Section 3.6 and (ii) Securities for
whose payment money has theretofore been deposited in trust or segregated and
held in trust by the Company and thereafter repaid to the Company or discharged
from such trust, as provided in Section 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
(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 Company,
and the Company, in the case of Clause (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 which have
become due and payable) or to the Stated Maturity or Redemption Date, as the
case may be;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
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(3) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture have
been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 6.7, the obligations of
the Company 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 Company 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 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):
(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 interest payment 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) default in the performance, or breach, in any material respect, of
any covenant or warranty of the Company in this Indenture with respect to that
series (other than a covenant or warranty a default in the performance of which
or the breach of
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which is elsewhere in this Section specifically dealt with), and continuance of
such default or breach for a period of 90 days after there has been given, by
registered or certified mail, to the Company by the Trustee or to the Company
and the Trustee by the Holders of at least 25% in principal amount of the
Outstanding Securities of that series a written notice specifying such default
or breach and requiring it to be remedied; or
(4) the entry of a decree or order by a court having jurisdiction in
the premises adjudging the Company a bankrupt or insolvent, or approving as
properly filed a petition seeking reorganization, arrangement, adjustment or
composition of or in respect of the Company under any applicable federal or
state bankruptcy, insolvency, reorganization or other similar law, or appointing
a receiver, liquidator, assignee, trustee, sequestrator (or other similar
official) of the Company or of any substantial part of its property or ordering
the winding up or liquidation of its affairs, and the continuance of any such
decree or order unstayed and in effect for a period of 60 consecutive days; or
(5) the institution by the Company of proceedings to be adjudicated a
bankrupt or insolvent, or the consent by it to the institution of bankruptcy or
insolvency proceedings against it, or the filing by it of a petition or answer
or consent seeking reorganization or relief under any applicable federal or
state bankruptcy, insolvency, reorganization or other similar law, or the
consent by it to the filing of any such petition or to the appointment of a
receiver, liquidator, assignee, trustee, sequestrator (or other similar
official) of the Company or of any substantial part of its property, or the
making by it of an assignment for the benefit for creditors, or the admission by
it in writing of its inability to pay its debts generally as they become due and
its willingness to be adjudicated a bankrupt, or the taking of corporate action
by the Company in furtherance of any such action; 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 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
Company (and to the Trustee if given by Holders), provided that, in the case of
the Securities of a series issued to a Trust, if, upon an Event of Default, the
Trustee or the
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Holders of not less than 25% in principal amount of the Outstanding Securities
of that series fail to 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 immediately due and payable, the holders of at least 25% in aggregate
liquidation amount of the corresponding series of Preferred Securities then
outstanding shall have such right by a notice in writing to the Company 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.
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. 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 that series (or, if the Securities of
that 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.
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 principal amount of the
Outstanding Securities of that series, by written notice to the Company and the
Trustee, may rescind and annul such declaration and its consequences if:
(1) the Company has paid or deposited with the Trustee a sum sufficient
to pay:
(A) all overdue installments of interest (including any
Additional Interest) on all Securities of that series,
(B) the principal of (and premium, if any, on) any Securities
of that series which have become due otherwise than by such declaration of
acceleration and interest thereon at the rate borne by the Securities, and
(C) 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 which
has become due solely by such acceleration, have been cured or waived as
provided in Section 5.13;
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provided that, in the case of Securities of a series held by a Trust, if the
Holders of at least a majority in principal amount of the Outstanding Securities
of that series fails to rescind and annul such declaration and its consequences,
the holders of a majority in aggregate Liquidation Amount (as defined in the
Trust Agreement under which such Trust is formed) of the related series of
Preferred Securities then outstanding shall have such right by written notice to
the Company 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.
Section 5.3. Collection of Indebtedness and Suits for Enforcement by
Trustee.
The Company covenants that if:
(1) default is made in the payment of any installment of interest
(including any Additional Interest) on any Security when such interest becomes
due and payable and such default continues for a period of 30 days, or
(2) default is made in the payment of the principal of (and premium, if
any, on) any Security at the Maturity thereof,
the Company 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 Company 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 Company or any other obligor upon the Securities and collect the
moneys adjudged or decreed to be payable in the manner provided by law out of
the property of the Company 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.
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Section 5.4. Trustee May File Proofs of Claim.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company 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 of acceleration or otherwise and irrespective of whether the
Trustee shall have made any demand on the Company 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 (or, if the Securities of that series are Discount Securities, such
portion of the principal amount as may be due and payable pursuant to a
declaration in accordance with Section 5.2) (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 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.
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Section 5.5. Trustee May Enforce Claims Without Possession of
Securities.
All rights of action and claims under this Indenture or the Securities
may be prosecuted and enforced by the 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, 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 such series of Securities for principal (and premium, if any),
interest (including any Additional Interest) and Additional Taxes, 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
THIRD: The balance, if any, to the Person or Persons entitled thereto.
Section 5.7. Limitation on Suits.
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 principal amount of the
Outstanding Securities of that series shall have made written
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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
security or 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 security or indemnity has failed to institute any such proceeding;
and
(5) no direction inconsistent with such written request has been given
to the Trustee during such 60-day period by the Holders of a majority in
principal amount of the Outstanding Securities 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 Preferred Securities.
Notwithstanding any other provision in this Indenture, the Holder of
any Security shall have the right which is absolute and unconditional to receive
payment of the principal of (and premium, if any) and (subject to Section 3.7)
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 held by a Trust, any holder of the
corresponding series of Preferred Securities held by such 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 Company for enforcement of
payment to such holder of principal of (premium, if any) and (subject to Section
3.7) interest (including any Additional Interest) on the Securities having a
principal amount equal to the aggregate Liquidation Amount (as defined in the
Trust Agreement under which such Trust is formed) of such Preferred Securities
of the corresponding series held by such holder.
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Section 5.9. Restoration of Rights and Remedies.
If the Trustee, any Holder or any holder of Preferred Securities 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
Preferred Securities, then and in every such case the Company, the Trustee, the
Holders and such holder of Preferred 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, the Holders and the holders of Preferred 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 3.6, no
right or remedy herein conferred upon or reserved to the Trustee or to the
Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
Section 5.11. Delay or Omission Not Waiver.
No delay or omission of the Trustee, any Holder of any Security or any
holder of any Preferred Security to exercise any right or remedy accruing upon
any Event of Default shall impair any such right or remedy or constitute a
waiver of any such Event of Default or an acquiescence therein.
Every right and remedy given by this Article or by law to the Trustee
or to the Holders and the right and remedy given to the holders of Preferred
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 Preferred
Securities, as the case may be.
Section 5.12. Control by Holders.
The Holders of a majority in 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,
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(2) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction, and
(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 principal amount of the
Outstanding Securities of any series and, in the case of any Securities of a
series issued to a Trust, the holders of a majority in Liquidation Amount (as
defined in the relevant Trust Agreement) of Preferred Securities issued by such
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 all
Events of Default with respect to Securities of that series, other than the
non-payment of the principal of Securities of that series which has become due
solely by such acceleration, have been cured or annulled as provided in Section
5.3 and the Company has paid or deposited with the Trustee a sum sufficient to
pay all overdue installments of interest (including any Additional Interest) on
all Securities of that series, the principal of (and premium, if any, on) any
Securities of that series which have become due otherwise than by such
declaration of acceleration and interest thereon at the rate borne by the
Securities, and all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel), or
(2) in respect of a covenant or provision hereof which under Article IX
cannot be modified or amended without the consent of the Holder of each
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
Preferred Securities issued by such Trust, by all holders of Preferred
Securities issued by such 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.
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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 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.
Section 5.15. Waiver of Usury, Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any 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 Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
ARTICLE 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
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certificates or opinions which 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 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 any trust or power conferred upon the Trustee, under this Indenture
with respect to the Securities of such 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;
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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 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 which 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 rely and shall be protected in acting or refraining
from acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, 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 Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any resolution
of the Board of Directors may be sufficiently evidenced by a Board Resolution;
(c) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other evidence
be herein specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officers' Certificate;
(d) the Trustee may consult with counsel of its selection and the
advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
by it hereunder in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders pursuant to this Indenture, unless such Holders shall have
offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities which might be incurred by it in compliance with such
request or direction;
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(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 Company,
personally or by agent or attorney;
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder;
(h) the Trustee shall not be liable for any action taken, suffered, or
omitted to be taken by it in good faith and reasonably believed by it to be
authorized or within the discretion or rights or powers conferred upon it by
this Indenture;
(i) the Trustee shall not be deemed to have notice of any Default or
Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any event which is in fact such a
default is received by the Trustee at the Corporate Trust Office of the Trustee,
and such notice references the Securities and this Indenture; and
(j) the rights, privileges, protections, immunities and benefits given
to the Trustee, including, without limitation, its right to be indemnified, are
extended to, and shall be enforceable by, the Trustee in each of its capacities
hereunder, and to each agent, custodian and other Person employed to act
hereunder.
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 Company, 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 Company 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 Company, 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 Company with the same rights it would
have if it were
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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 in writing with the Company.
Section 6.7. Compensation and Reimbursement.
The Company, as borrower, agrees
(1) to pay to the Trustee from time to time such compensation as shall
be agreed in writing between the Company and the Trustee for all services
rendered by it hereunder (which compensation shall not be limited by any
provision of law in regard to the compensation of a trustee of an express
trust);
(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 each of the Trustee and any predecessor Trustee for,
and to hold it harmless against, any and all loss, liability, damage, claim 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.
To secure the Company's payment obligations in this Section, the
Company and the Holders agree that the Trustee shall have a lien prior to the
Securities on all money or property held or collected by the Trustee. Such lien
shall survive the satisfaction and discharge of this Indenture.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 5.1(4) or (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.
This section shall survive the termination of this Agreement.
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Section 6.8. Disqualification; Conflicting Interests.
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).
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
(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, 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, it
shall resign immediately in the manner and with the effect hereinafter specified
in this Article. Neither the Company nor any Person directly or indirectly
controlling, controlled by or under common control with the Company 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 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 Company. If an
instrument of acceptance by a successor
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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 principal amount
of the Outstanding Securities of such series, delivered to the Trustee and to
the Company. If an instrument of acceptance by a successor Trustee shall not
have been delivered to the Trustee within 30 days after such removal, the
Trustee being removed may petition any court of competent jurisdiction for the
appointment of a successor Trustee with respect to the Securities of such
series.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 6.8 after
written request therefor by the Company or by any Holder who has been a bona
fide Holder of a Security for at least six months, or
(2) the Trustee shall cease to be eligible under Section 6.9
and shall fail to resign after written request therefor by the Company or by any
such Holder, or
(3) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of its property
shall be appointed or any public officer shall take charge or control of the
Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation,
then, in any such case, (i) the Company, acting pursuant to the authority of a
Board Resolution, may remove the Trustee with respect to all Securities, 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 himself and all others
similarly situated, petition any court of competent jurisdiction for the removal
of the Trustee with respect to all Securities 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 Company, 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 principal amount of the Outstanding Securities of such
series delivered to the Company and the retiring Trustee, the successor Trustee
so
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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 Company. If no successor Trustee with
respect to the Securities of any series shall have been so appointed by the
Company or the Holders and accepted appointment in the manner hereinafter
provided, any Holder who has been a bona fide Holder of a Security for at least
six months may, subject to Section 5.14, on behalf of himself 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 Company 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 Company and to the retiring Trustee an
instrument accepting such appointment, and thereupon the resignation or removal
of the retiring Trustee shall become effective and such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee; but, on the request
of the Company or the successor Trustee, such retiring Trustee shall, upon
payment of its charges, execute and deliver an instrument transferring to such
successor Trustee all the rights, powers and trusts of the retiring Trustee and
shall duly assign, transfer and deliver to such successor Trustee all property
and money held by such retiring Trustee hereunder.
(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 Company, 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 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
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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 Company 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 Company 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
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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 Company.
If and when the Trustee shall be or become a creditor of the Company
(or any other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company (or any such other obligor).
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
Company 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 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
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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 Company. 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 Company. 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 Company 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 Company agrees to pay to each Authenticating Agent from time to
time reasonable compensation for its services under this Section.
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 referred to in the within mentioned
Indenture.
Dated: /s/ THE BANK OF NEW YORK
------------------------------
As Trustee
By:
---------------------------
As Authenticating Agent
By:
---------------------------
Authorized Officer
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ARTICLE VII
HOLDER'S LISTS AND REPORTS BY TRUSTEE AND COMPANY
Section 7.1. Company to Furnish Trustee Names and Addresses of Holders.
The Company will furnish or cause to be furnished to the Trustee:
(a) semi-annually, not more than 15 days after December 15, March 15,
June 15, and September 15 in each year, a list, in such form as the Trustee may
reasonably require, of the names and addresses of the Holders as of such
December 15, March 15, June 15, and September 15, and
(b) at such other times as the Trustee may request in writing, within
30 days after the receipt by the Company of any such request, a list of similar
form and content as of a date not more than 15 days prior to the time such list
is furnished,
excluding from any such list names and addresses received by the Trustee in its
capacity as 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 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 Company and the Trustee that neither the Company nor the Trustee
nor any agent of either of them shall be held accountable by reason of 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. If
required by
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Section 313(a) of the Trust Indenture Act, the Trustee shall, within sixty days
after each May 15 following the date of this Indenture deliver to Holders a
brief report, dated as of such May 15, which complies with the provisions of
such Section 313(a).
(b) A copy of each such report shall, at the time of such transmission
to Holders, be filed by the Trustee with each stock exchange upon which any
Securities are listed and also with the Commission. The Company will promptly
notify the Trustee when any Securities are listed on any stock exchange, or of
any delisting thereof.
Section 7.4. Reports by Company.
The Company 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 Company may not be required to remain
subject to the reporting requirements of Section 13 or 15(d) of the Exchange
Act, the Company 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 Company
also shall comply with the other provisions of Trust Indenture Act Section
314(a). Delivery of such reports, information and documents to the Trustee is
for informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein, including
the Company's compliance with any of its covenants hereunder (as to which the
Trustee is entitled to rely exclusively on Officers' Certificates).
ARTICLE VIII
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
Section 8.1. Company May Consolidate, Etc., Only on Certain Terms.
The Company shall not consolidate with or merge into any other Person
or convey, transfer or lease its properties and assets substantially as an
entirety to any Person, and no Person shall consolidate with or merge into the
Company or convey, transfer or lease its properties and assets substantially as
an entirety to the Company, unless:
(1) in case the Company 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 Person
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formed by such consolidation or into which the Company is merged or the Person
which acquires by conveyance or transfer, or which leases, the properties and
assets of the Company substantially as an entirety shall be a corporation,
partnership or trust organized and existing under the laws of the United States
of America or any State or the District of Columbia and shall expressly assume,
by an indenture supplemental hereto, executed and delivered to the Trustee, in
form satisfactory to the Trustee, the due and punctual payment of the principal
of (and premium, if any) and interest (including any Additional Interest) on all
the Securities and the performance of every covenant of this Indenture on the
part of the Company to be performed or observed;
(2) immediately after giving effect to such transaction, no Event of
Default, and no event which, after notice or lapse of time, or both, would
become an Event of Default, shall have happened and be continuing;
(3) in the case of the Securities of a series held by a Trust, such
consolidation, merger, conveyance, transfer or lease is not prohibited under the
related Trust Agreement and Guarantee and does not give rise to any breach or
violation of the related Trust Agreement or Guarantee; and
(4) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that such consolidation, merger,
conveyance, transfer or lease and any such supplemental indenture complies with
this Article and that all conditions precedent herein provided for relating to
such transaction have been complied with; and the Trustee, subject to Section
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 Company with or into any other
Person, or any conveyance, transfer or lease by the Company of its properties
and assets substantially as an entirety to any Person in accordance with Section
8.1, the successor Person formed by such consolidation or into which the Company
is merged or to which such conveyance, transfer or lease is made shall succeed
to, and be substituted for, and may exercise every right and power of, the
Company under this Indenture with the same effect as if such successor Person
had been named as the Company herein; and in the event of any such conveyance,
transfer or lease the Company shall be discharged from all obligations and
covenants under the Indenture and the Securities and may be dissolved and
liquidated.
Such successor Person may cause to be signed, and may issue either in
its own name or in the name of the Company, any or all of the Securities
issuable hereunder which theretofore shall not have been signed by the Company
and delivered to the Trustee; and, upon the written order of such successor
Person instead of the Company
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and subject to all the terms, conditions and limitations in this Indenture
prescribed, the Trustee shall authenticate and shall make available for delivery
any Securities which previously shall have been signed and delivered by the
officers of the Company to the Trustee for authentication pursuant to such
provisions and any Securities which such successor Person thereafter shall cause
to be signed and delivered to the Trustee on its behalf for the purpose pursuant
to such provisions. All the Securities so issued shall in all respects have the
same legal rank and benefit under this Indenture as the Securities theretofore
or thereafter issued in accordance with the terms of this Indenture as though
all of such Securities had been issued at the date of the execution hereof.
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 Company, when authorized by a
Board Resolution, and the Trustee, at any time and from time to time, may enter
into one or more indentures supplemental hereto, in form reasonably satisfactory
to the Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the Company, and
the assumption by any such successor of the covenants of the Company herein and
in the Securities 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
Company; 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 Company 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 such series) or to
surrender any right or power herein conferred upon the Company; 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 such series); or
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(6) to change or eliminate any of the provisions of this Indenture,
provided that any such change or elimination shall become effective only when
there is no Security Outstanding of any series created prior to the execution of
such supplemental indenture which is entitled to the benefit of such provision;
or
(7) to cure any ambiguity, to correct or supplement any provision
herein which 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 a Trust and for so long as any of the corresponding series of
Preferred Securities issued by such Trust shall remain outstanding, the holders
of such Preferred 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 the 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
principal amount of the Outstanding Securities of each series affected by such
supplemental indenture, by Act of said Holders delivered to the Company and the
Trustee, the Company, when authorized by a Board Resolution, and the Trustee may
enter into an indenture or indentures supplemental hereto for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of modifying in any manner the rights of the
Holders 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 affected thereby,
(1) except to the extent permitted by Section 3.11 or as otherwise
specified as contemplated by Section 2.1 or Section 3.1 with respect to the
deferral of the payment of interest on the Securities of any series, 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 reduce 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
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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 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; or
(4) modify the provisions in Article XIII of this Indenture with
respect to the subordination of Outstanding Securities of any series in a manner
adverse to the Holders thereof;
provided, further, that, in the case of the Securities of a series issued to a
Trust, so long as any of the corresponding series of Preferred Securities issued
by such Trust remains outstanding, (i) no such amendment shall be made that
adversely affects the holders of such Preferred 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 Trust Agreement under which
such Trust is organized) of such Preferred Securities then outstanding unless
and until the principal (and premium, if any) of the Securities of such series
and all accrued and, subject to Section 3.7, 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 Preferred Securities provided therein without the prior consent of
the holders of each Preferred Security then outstanding unless and until the
principal (and premium, if any) of the Securities of such series and all accrued
and (subject to Section 3.7) 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 Preferred
Securities, or which modifies the rights of the Holders of Securities or holders
of Preferred Securities of such 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 or holders of Preferred Securities of any other series.
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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 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 have been complied with. The Trustee may, but
shall not be obligated to, enter into any such supplemental indenture which
affects the Trustee's own rights, duties 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.
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 Company, bear a notation in form approved by the Company as to any matter
provided for in such supplemental indenture. If the Company shall so determine,
new Securities of any series so modified as to conform, in the opinion of the
Company, to any such supplemental indenture may be prepared and executed by the
Company and authenticated and delivered by the Trustee in exchange for
Outstanding Securities of such series.
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ARTICLE X
COVENANTS
Section 10.1. Payment of Principal, Premium and Interest.
The Company 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 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 Company 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 and an office or agency where Securities of that
series may be surrendered for transfer or exchange and where notices and demands
to or upon the Company in respect of the Securities of that series and this
Indenture may be served. The Company initially appoints the Trustee, acting
through its Corporate Trust Office, as its agent for said purposes. The Company
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 Company 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 Company hereby
appoints the Trustee as its agent to receive all such presentations, surrenders,
notices and demands.
The Company may also from time to time designate one or more other
offices or agencies 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 Company of its obligation to maintain an office or agency in each
Place of Payment for Securities of any series for such purposes. The Company
will give prompt written notice to the Trustee of any such designation and any
change in the location of any such office or agency.
Section 10.3. Money for Security Payments to be Held in Trust.
If the Company 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) 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 of its
failure so to act.
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Whenever the Company 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
interest on any Securities, deposit with a Paying Agent a sum sufficient to pay
the principal (and premium, if any) or 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, and (unless such Paying Agent is the Trustee) the
Company will promptly notify the Trustee of its failure so to act.
The Company will cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section, that
such Paying Agent will:
(1) hold all sums held by it for the payment of the principal of (and
premium, if any) or interest (including Additional Interest) on Securities 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 notice of any default by the Company (or any other
obligor upon the Securities) in the making of any payment of principal (and
premium, if any) or interest (including Additional Interest);
(3) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so held in
trust by such Paying Agent; and
(4) comply with the provisions of the Trust Indenture Act applicable to
it as a Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by the Company or any Paying Agent to
the Trustee, such Paying Agent shall be released from all further liability with
respect to such money.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of (and premium, if
any) or interest (including Additional Interest) on any Security and remaining
unclaimed for two years after such principal (and premium, if 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 Company Request to the Company, or (if then held by the Company) 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
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shall thereafter, as an unsecured general creditor, look only to the Company for
payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Company as trustee
thereof, shall thereupon cease; provided, however, that the Trustee or such
Paying Agent, before being required to make any such repayment, may at the
expense of the Company 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 Company.
Section 10.4. Statement as to Compliance; Statement by Officers as to
Default.
The Company shall deliver to the Trustee, within 120 days after the end
of each calendar year of the Company ending after the date hereof, an Officers'
Certificate, one of the signatories of which shall be the principal executive,
principal financial or principal accounting officer of the Company, covering the
preceding calendar year, stating whether or not to the best knowledge of the
signers thereof the Company 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 Company 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.
The Company shall deliver to the Trustee, as soon as possible and in
any event within five days after the Company becomes aware of the occurrence of
any Event of Default, an Officers' Certificate setting forth the details of such
Event of Default and the action which the Company proposes to take with respect
thereto.
Section 10.5. Waiver of Certain Covenants.
The Company 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 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 Company in respect of any
such covenant or condition shall remain in full force and effect.
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Section 10.6. Payment of Trust Costs and Expenses.
Since each Trust is being formed solely to facilitate an investment in
the Securities, the Company, in its capacity as the issuer of the Securities,
hereby covenants to pay all debts and obligations (other than with respect to
the Preferred Securities and Common Securities) and all costs and expenses of
each Trust (including, but not limited to, all costs and expenses relating to
the organization of the Trust, the fees and expenses of the Trustees and all
costs and expenses relating to the operation of the Trust) and to pay any and
all taxes, duties, assessments or governmental charges of whatever nature (other
than withholding taxes) imposed on the Trust by the United States, or any other
taxing authority, so that the net amounts received and retained by the Trust and
the Property Trustee after paying such expenses will be equal to the amounts the
Trust and the Property Trustee would have received had no such costs or expenses
been incurred by or imposed on the Trust. The obligations of the Company to pay
all debts, obligations, costs and expenses of each Trust (other than with
respect to the Preferred Securities and Common Securities) shall constitute
additional indebtedness hereunder and shall survive the satisfaction and
discharge of this Indenture.
Section 10.7. Additional Covenants.
The Company covenants and agrees with each Holder of Securities of each
series that it shall not, and it shall not permit any Subsidiary of the Company
to, (i) declare or pay any dividends or distributions on, or redeem purchase,
acquire or make a liquidation payment with respect to, any shares of the
Company'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
Company that rank pari passu with or junior in interest to the Securities of
such series or (iii) make any guarantee payments with respect to any guarantee
by the Company of debt securities of any subsidiary of the Company if such
guarantee ranks pari passu with or junior in interest to the Securities (other
than (a) dividends or distributions in the Company's capital stock, (b) any
declaration of a dividend in connection with the implementation of a Rights Plan
or the redemption or repurchase of any rights distributed pursuant to a Rights
Plan, (c) payments under the Guarantee with respect to the Securities of such
Series, and (d) purchases of Common Stock related to the issuance of Common
Stock or rights under any of the Company's benefit plans for its directors,
officers or employees, related to the issuance of Common Stock or rights under a
dividend reinvestment and stock purchase plan, or related to the issuance of
Common Stock (or securities convertible or exchangeable for Common Stock) as
consideration in an acquisition transaction that was entered into prior to the
commencement of such Extension Period) if at such time (x) there shall have
occurred any event of which the Company has actual knowledge that (A) 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) in respect of
which the Company
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shall not have taken reasonable steps to cure, (y) if the Securities of such
series are held by a Trust, the Company shall be in default with respect to its
payment of any obligations under the Guarantee relating to the Preferred
Securities issued by such Trust or (z) the Company 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.
The Company also covenants with each Holder of Securities of a series
issued to a Trust (i) to maintain directly or indirectly 100% ownership of the
Common Securities of such Trust; provided, however, that any permitted successor
of the Company hereunder may succeed to the Company's ownership of such Common
Securities, (ii) not to voluntarily terminate, wind-up or liquidate such Trust,
except (a) in connection with a distribution of the Securities of such series to
the holders of the Trust Securities of such Trust in liquidation of such 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 Trust to remain classified as a grantor trust and not an association
taxable as a corporation for United States federal income tax purposes.
Section 10.8. Calculation of Original Issue Discount.
The Company shall file with the Trustee promptly at the end of each
calendar year (i) a written notice specifying the amount of original issue
discount (including daily rates and accrual periods) accrued on Outstanding
Securities as of the end of such year and (ii) such other specific information
relating to such original issue discount as may then be relevant under the
Internal Revenue Code of 1986, as amended from time to time.
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 such series shall be
subject to partial redemption only in the amount of $25 or, in the case of the
Securities of a series issued to a Trust, $25, or integral multiples thereof.
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Section 11.2. Election to Redeem; Notice to Trustee.
The election of the Company to redeem any Securities shall be evidenced
by or pursuant to a Board Resolution. In case of any redemption at the election
of the Company of the Securities, the Company shall, not less than 45 nor more
than 60 days prior to the Redemption Date (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee of such date and of the
principal amount of Securities of that series to be redeemed. 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 Company 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
(unless all the Securities of such series and of a specified tenor are to be
redeemed or unless such redemption affects only a single Security), 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 lot or such other 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. If less than all the
Securities of such series and of a specified tenor are to be redeemed (unless
such redemption affects only a single Security), 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 and specified tenor
not previously called for redemption in accordance with the preceding sentence.
The Trustee shall promptly notify the Company 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 which has been or is to be
redeemed. If the Company shall so direct, Securities registered in the name of
the Company, any Affiliate or any Subsidiary thereof shall not be included in
the Securities selected for redemption.
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
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each Holder of Securities to be redeemed, at the address of such Holder as it
appears in the Securities Register.
With respect to Securities of each series to be redeemed, each notice
of redemption shall identify the Securities to be redeemed (including CUSIP
number, if a CUSIP number has been assigned to such Securities of such Series)
and shall state:
(a) the Redemption Date;
(b) the Redemption Price;
(c) if less than all Outstanding Securities of such particular series
and having the same terms are to be redeemed, the identification (and, in the
case of partial redemption, the respective principal amounts) of the particular
Securities to be redeemed;
(d) that on the Redemption Date, the Redemption Price will become due
and payable upon each such Security or portion thereof, and that 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; and
(f) that the redemption is for a sinking fund, if such is the case.
Notice of redemption of Securities to be redeemed at the election of
the Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company and shall not be
irrevocable. The notice if mailed in the manner herein provided 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 Company will
deposit with the Trustee or with one or more Paying Agents (or if the Company is
acting as its own Paying Agent, the Company 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 Additional Interest) on, all the
Securities which are to be redeemed on that date.
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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. 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 Company 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 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 3.7.
Upon presentation of any Security redeemed in part only, the Company
shall execute and the Trustee shall authenticate and make available for delivery
to the Holder thereof, at the expense of the Company, a new Security or
Securities of the same series, of authorized denominations, in aggregate
principal amount equal to the unredeemed portion of the Security so presented
and having the same Original Issue Date, Stated Maturity and terms. If a Global
Security is so surrendered, such new Security will also be a new Global
Security.
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 a
Trust.
In the case of the Securities of a series initially issued to a Trust,
except as otherwise established pursuant to Section 3.1 for the Securities of a
Series, the Company, at its option, may redeem such Securities (i) on or after
the date five years after the Original Issue Date of such Securities, 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 a Capital Treatment Event, at any time within
90 days following the occurrence of such Tax Event or Capital Treatment Event in
respect of such Trust, in whole (but not in part), in each case at a Redemption
Price equal to 100% of the principal amount thereof; provided that the Company's
right to redeem such Securities pursuant to clause (i) or (ii) above is subject
to the Company having received the prior approval of the Federal Reserve if
required under applicable capital guidelines or policies.
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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 which 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.
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 Company may at its
option, at any time no more than 16 months and no less than 30 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
Company, 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 Company Order instructing the
Trustee to credit such obligations and stating that the Securities of such
series were originally issued by the Company 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 60 days prior to each sinking fund payment date for any
series of Securities, the Company 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
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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, which 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 Company 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 Company to deliver such Officers'
Certificate (or, as required by this Indenture, the Securities and coupons, if
any, specified in such Officers' Certificate), 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 Company if the Company 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 Company is acting as its own Paying Agent, segregated and
held in trust by the Company 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 Company is acting as its own Paying Agent, segregated and
held in 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 Company if the Company 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 Company 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 Company shall pay to the Trustee (or, if the Company is acting
as its own Paying Agent, the
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Company 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 any 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 Company 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 Company, if the
Company 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 Company) 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 Debt.
The Company 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 are hereby expressly made subordinate and subject
in right of payment to the prior payment in full of all Senior Debt.
Section 13.2. Payment Over of Proceeds Upon Dissolution, Etc.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company (each such event, if any, herein
sometimes referred to as a "Proceeding"), then the holders of Senior Debt shall
be entitled to receive payment in full of all amounts due or to become due on
such
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Senior Debt, or provision shall be made for such payment in cash or cash
equivalents or otherwise in a manner satisfactory to the holders of Senior Debt,
before the Holders of the Securities are entitled to receive or retain any
payment or distribution of any kind or character, whether in cash, property or
securities (including any payment or distribution which may be payable or
deliverable by reason of the payment of any other Debt of the Company (including
any series of the Securities) subordinated to the payment of the Securities,
such payment or distribution being hereinafter referred to as a "Junior
Subordinated Payment"), on account of principal of (or premium, if any) or
interest (including any Additional Interest) on the Securities or on account of
the purchase or other acquisition of Securities by the Company or any Subsidiary
and to that end the holders of Senior Debt shall be entitled to receive, for
application to the payment thereof, any payment or distribution of any kind or
character, whether in cash, property or securities, including any Junior
Subordinated Payment, which may be payable or deliverable in respect of the
Securities in any such Proceeding; provided, however, that holders of Senior
Debt shall not be entitled to receive payment of any such amounts to the extent
that such holders would be required by the subordination provisions of such
Senior Debt to pay such amounts over to the obligees on trade accounts payable
or other liabilities arising in the ordinary course of the Company's business.
In the event that, notwithstanding the foregoing provisions of this
Section, the Trustee or the Holder of any Security shall have received any
payment or distribution of assets of the Company of any kind or character,
whether in cash, property or securities, including any Junior Subordinated
Payment, before all amounts due or to become due on all Senior Debt are paid in
full or payment thereof is provided for in cash or cash equivalents or otherwise
in a manner satisfactory to the holders of Senior Debt, and if such fact shall,
at or prior to the time of such payment or distribution, have been made known to
the Trustee or, as the case may be, such Holder, then and in such event such
payment or distribution shall be paid over or delivered forthwith to the trustee
in bankruptcy, receiver, liquidating trustee, custodian, assignee, agent or
other Person making payment or distribution of assets of the Company for
application to the payment of all amounts due or to become due on all Senior
Debt remaining unpaid, to the extent necessary to pay all amounts due or to
become due on all Senior Debt in full, after giving effect to any concurrent
payment or distribution to or for the holders of Senior Debt; provided, however,
that holders of Senior Debt shall not be entitled to receive payment of any such
amounts to the extent that such holders would be required by the subordination
provisions of such Senior Debt to pay such amounts over to the obligees on trade
accounts payable or other liabilities arising in the ordinary course of the
Company's business.
For purposes of this Article only, the words "any payment or
distribution of any kind or character, whether in cash, property or securities"
shall not be deemed to include shares of stock of the
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Company as reorganized or readjusted, or securities of the Company or any other
corporation provided for by a plan of reorganization or readjustment which
securities are subordinated in right of payment to all then outstanding Senior
Debt to substantially the same extent as the Securities are so subordinated as
provided in this Article. The consolidation of the Company with, or the merger
of the Company into, another Person or the liquidation or dissolution of the
Company following the sale of all or substantially all of its properties and
assets as an entirety to another Person upon the terms and conditions set forth
in Article VIII shall not be deemed a Proceeding for the purposes of this
Section if the Person formed by such consolidation or into which the Company is
merged or the Person which acquires by sale such properties and assets as an
entirety, as the case may be, shall, as a part of such consolidation, merger, or
sale comply with the conditions set forth in Article VIII.
Section 13.3. Prior Payment to Senior Debt Upon Acceleration of
Securities.
In the event that any Securities are declared due and payable before
their Stated Maturity, then and in such event the holders of the Senior Debt
outstanding at the time such Securities so become due and payable shall be
entitled to receive payment in full of all amounts due on or in respect of such
Senior Debt (including any amounts due upon acceleration), or provision shall be
made for such payment in cash or cash equivalents or otherwise in a manner
satisfactory to the holders of Senior Debt, before the Holders of the Securities
are entitled to receive any payment or distribution of any kind or character,
whether in cash, properties or securities (including any Junior Subordinated
Payment) by the Company on account of the principal of (or premium, if any) or
interest (including any Additional Interest) on the Securities or on account of
the purchase or other acquisition of Securities by the Company or any
Subsidiary; provided, however, that nothing in this Section shall prevent the
satisfaction of any sinking fund payment in accordance with this Indenture or as
otherwise specified as contemplated by Section 3.1 for the Securities of any
series by delivering and crediting pursuant to Section 12.2 or as otherwise
specified as contemplated by Section 3.1 for the Securities of any series
Securities which have been acquired (upon redemption or otherwise) prior to such
declaration of acceleration; provided, however, that holders of Senior Debt
shall not be entitled to receive payment of any such amounts to the extent that
such holders would be required by the subordination provisions of such Senior
Debt to pay such amounts over to the obligees on trade accounts payable or other
liabilities arising in the ordinary course of the Company's business.
In the event that, notwithstanding the foregoing, the Company shall
make any payment to the Trustee or the Holder of any Security prohibited by the
foregoing provisions of this Section, and if such fact shall, at or prior to the
time of such payment, have been made known to the Trustee or, as the case may
be, such Holder, then and
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in such event such payment shall be paid over and delivered forthwith to the
Company.
The provisions of this Section shall not apply to any payment with
respect to which Section 13.2 would be applicable.
Section 13.4. No Payment When Senior Debt in Default.
(a) In the event and during the continuation of any default in the
payment of principal of (or premium, if any) or interest on any Senior Debt, or
in the event that any event of default with respect to any Senior Debt shall
have occurred and be continuing and shall have resulted in such Senior Debt
becoming or being declared due and payable prior to the date on which it would
otherwise have become due and payable, unless and until such event of default
shall have been cured or waived or shall have ceased to exist and such
acceleration shall have been rescinded or annulled, or (b) in the event any
judicial proceeding shall be pending with respect to any such default in payment
or such event or default, then no payment or distribution of any kind or
character, whether in cash, properties or securities (including any Junior
Subordinated Payment) shall be made by the Company on account of principal of
(or premium, if any) or interest (including any Additional Interest), if any, on
the Securities or on account of the purchase or other acquisition of Securities
by the Company or any Subsidiary, in each case unless and until all amounts due
or to become due on such Senior Debt are paid in full; provided, however, that
nothing in this Section shall prevent the satisfaction of any sinking fund
payment in accordance with this Indenture or as otherwise specified as
contemplated by Section 3.1 for the Securities of any series by delivering and
crediting pursuant to Section 12.2 or as otherwise specified as contemplated by
Section 3.1 for the Securities of any series Securities which have been acquired
(upon redemption or otherwise) prior to such default in payment or event of
default; provided, however, that holders of Senior Debt shall not be entitled to
receive payment of any such amounts to the extent that such holders would be
required by the subordination provisions of such Senior Debt to pay such amounts
over to the obligees on trade accounts payable or other liabilities arising in
the ordinary course of the Company's business.
In the event that, notwithstanding the foregoing, the Company shall
make any payment to the Trustee or the Holder of any Security prohibited by the
foregoing provisions of this Section, and if such fact shall, at or prior to the
time of such payment, have been made known to the Trustee or, as the case may
be, such Holder, then and in such event such payment shall be paid over and
delivered forthwith to the Company.
The provisions of this Section shall not apply to any payment with
respect to which Section 13.2 would be applicable.
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Section 13.5. 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 Company, at any time except during
the pendency of any Proceeding referred to in Section 13.2 or under the
conditions described in Sections 13.3 and 13.4, from making payments at any time
of principal of (and premium, if any) or interest (including Additional
Interest) on the Securities, or (b) the application by the Trustee of any money
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 13.6. Subrogation to Rights of Holders of Senior Debt.
Subject to the payment in full of all amounts due or to become due on
all Senior Debt, or the provision for such payment in cash or cash equivalents
or otherwise in a manner satisfactory to the holders of Senior Debt, the Holders
of the Securities shall be subrogated to the extent of the payments or
distributions made to the holders of such Senior Debt pursuant to the provisions
of this Article (equally and ratably with the holders of all indebtedness of the
Company which by its express terms is subordinated to Senior Debt of the Company
to substantially the same extent as the Securities are subordinated to the
Senior Debt and is entitled to like rights of subrogation by reason of any
payments or distributions made to holders of such Senior Debt) to the rights of
the holders of such Senior Debt to receive payments and distributions of cash,
property and securities applicable to the Senior Debt until the principal of
(and premium, if any) and interest on the Securities shall be paid in full. For
purposes of such subrogation, no payments or distributions to the holders of the
Senior Debt 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 Debt by Holders of the Securities or the Trustee, shall, as
among the Company, its creditors other than holders of Senior Debt, and the
Holders of the Securities, be deemed to be a payment or distribution by the
Company to or on account of the Senior Debt.
Section 13.7. 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 Debt 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 Company and the Holders of the Securities,
the
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obligations of the Company, 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 Company of the Holders of the Securities and
creditors of the Company other than their rights in relation to the holders of
Senior Debt; or (c) prevent the Trustee or the Holder of any Security from
exercising all remedies otherwise permitted by applicable law upon default under
this Indenture including, without limitation, filing and voting claims in any
Proceeding, subject to the rights, if any, under this Article of the holders of
Senior Debt to receive cash, property and securities otherwise payable or
deliverable to the Trustee or such Holder.
Section 13.8. 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 13.9. No Waiver of Subordination Provisions.
No right of any present or future holder of any Senior Debt to enforce
subordination as herein provided shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of the Company or by any act
or failure to act, in good faith, by any such holder, or by any noncompliance by
the Company with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof that any such holder may have or be
otherwise charged with.
Without in any way limiting the generality of the immediately preceding
paragraph, the holders of Senior Debt may, at any time and from to time, without
the consent of or notice to the Trustee or the Holders of the Securities,
without incurring responsibility to the Holders of the Securities and without
impairing or releasing the subordination provided in this Article or the
obligations hereunder of the Holders of the Securities to the holders of Senior
Debt, do any one or more of the following: (i) change the manner, place or terms
of payment or extend the time of payment of, or renew or alter, Senior Debt, or
otherwise amend or supplement in any manner Senior Debt or any instrument
evidencing the same or any agreement under which Senior Debt is outstanding;
(ii) sell, exchange, release or otherwise deal with any property pledged,
mortgaged or otherwise securing Senior Debt; (iii) release any Person liable in
any manner for the collection of Senior Debt; and (iv) exercise or refrain from
exercising any rights against the Company and any other Person.
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Section 13.10. Notice to Trustee.
The Company shall give prompt written notice to the Trustee of any fact
known to the Company which 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 which would prohibit the
making of any payment to or by the Trustee in respect of the Securities, unless
and until the Trustee shall have received written notice thereof from the
Company or a holder of Senior Debt 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, without limitation, the payment of the principal of (and premium, if
any) 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 which 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 to be a holder of Senior Debt (or a trustee therefor) to establish that
such notice has been given by a holder of Senior Debt (or a trustee 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 Debt 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 Debt 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 13.11. Reliance on Judicial Order or Certificate of Liquidating
Agent.
Upon any payment or distribution of assets of the Company 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 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
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distribution, the holders of the Senior Debt and other indebtedness of the
Company, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article.
Section 13.12. Trustee Not Fiduciary for Holders of Senior Debt.
The Trustee, in its capacity as trustee under this Indenture, shall not
be deemed to owe any fiduciary duty to the holders of Senior Debt 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 Company or to any other Person
cash, property or securities to which any holders of Senior Debt shall be
entitled by virtue of this Article or otherwise. With respect to the holders of
Senior Debt, the Trustee undertakes to perform or to observe only such of its
covenants or obligations as are specifically set forth in this Article and no
implied covenants or obligations with respect to holders of Senior Debt shall be
read into this Indenture against the Trustee.
Section 13.13. Rights of Trustee as Holder of Senior Debt; 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 Debt which may at
any time be held by it, to the same extent as any other holder of Senior Debt,
and nothing in this Indenture shall deprive the Trustee of any of its rights as
such holder. Nothing in this Article shall apply to claims of, or payments to,
the Trustee under or pursuant to Section 6.7.
Section 13.14. Article Applicable to Paying Agents.
In case at any time any Paying Agent other than the Trustee shall have
been appointed by the Company 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.
Section 13.15. Certain Conversions or Exchanges Deemed Payment.
For the purposes of this Article only, (a) the issuance and delivery of
junior securities upon conversion or exchange of Securities shall not be deemed
to constitute a payment or distribution on account of the principal of (or
premium, if any) or interest (including any Additional Interest) on Securities
or on account of the purchase or other acquisition of Securities, and (b) the
payment, issuance or delivery of cash, property or securities (other than junior
securities) upon conversion or exchange of a Security shall be deemed to
constitute payment on account of the
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principal of such security. For the purposes of this Section, the term "junior
securities" means (i) shares of any stock of any class of the Company and (ii)
securities of the Company which are subordinated in right of payment to all
Senior Debt which may be outstanding at the time of issuance or delivery of such
securities to substantially the same extent as, or to a greater extent than, the
Securities are so subordinated as provided in this Article.
Section 13.16. Trust Moneys Not Subordinated.
Notwithstanding anything contained herein to the contrary, payments
from money held in trust under Article IV by the Trustee for the payment of
principal of, premium, if any, and interest on the Securities shall not be
subordinated to the prior payment of any Senior Debt of the Company or subject
to the restrictions set forth in this Article XIII and none of the Holders shall
be obligated to pay over any such amount to the Company or any holder of Senior
Debt of the Company or any other creditor of the Company.
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* * * *
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, all as of the day and year first above written.
USBANCORP, INC.
By:_______________________________
Name:
Title:
THE BANK OF NEW YORK
as Trustee
By:_______________________________
Name:
Title:
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<PAGE> 1
EXHIBIT 4.2
USBANCORP, INC. CUSIP ____
__% JUNIOR SUBORDINATED DEFERRABLE INTEREST DEBENTURES
No. $30,927,850
USBANCORP, INC., a corporation organized and existing under
the laws of the Commonwealth of Pennsylvania (hereinafter called the "Company",
which term includes any successor corporation under the Indenture hereinafter
referred to), for value received, hereby promises to pay to The Bank of New
York, as Property Trustee (the "Property Trustee") for USBANCORP Capital Trust
I, a statutory business trust formed under the laws of the State of Delaware, or
registered assigns, the principal sum of Thirty Million Nine Hundred and
Twenty-Seven Thousand Eight Hundred and Fifty Dollars on June 30, 2028. The
Company further promises to pay interest on said principal sum from April 1,
1998 or from the most recent interest payment date (each such date, an "Interest
Payment Date") on which interest has been paid or duly provided for, (subject to
deferral as set forth herein) in arrears on March 31, June 30, September 30, and
December 31 of each year, commencing June 30, 1998, at the rate of % per
annum, until the principal hereof shall have become due and payable, plus
Additional Interest, if any, until the principal hereof is paid or duly provided
for or made available for payment and (without duplication and to the extent
that payment of such interest is enforceable under applicable law) on any
overdue installment of interest at the rate of % per annum, compounded
quarterly. The amount of interest payable for any period shall be computed on
the basis of twelve 30-day months and a 360-day year. The amount of interest
payable for any partial period shall be computed on the basis of the number of
days elapsed in a 360-day year of twelve 30-day months. In the event that any
date on which interest is payable on this Security is not a Business Day, then a
payment of the interest payable on such date will be made on the next succeeding
day which is a Business Day (and without any interest or other payment in
respect of any such delay), except that, if such Business Day is
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<PAGE> 2
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 the payment was originally payable. A "Business Day"
shall mean 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 the principal office of the Property Trustee under the
Trust Agreement hereinafter referred to for USBANCORP Capital Trust I is closed
for business. The interest installment so payable, and punctually paid or duly
provided for, on any Interest Payment Date will, as provided in the Indenture,
be paid to the Person in whose name this Security (or one or more Predecessor
Securities is registered at the close of business on the Regular Record Date for
such interest installment, which shall be the any Business Day prior to the
relevant Interest Payment Date. Any such interest installment not so punctually
paid or duly provided for shall forthwith cease to be payable to the Holder on
such Regular Record Date and may either be paid to the Person in whose name 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 or automated quotation system on which
the Securities of this series may be listed or traded, and upon such notice as
may be required by such exchange or self-regulatory organization, all as more
fully provided in said Indenture.
So long as no Event of Default has occurred and is continuing,
the Company shall have the right at any time during the term of this Security to
defer payment of interest on this Security, at any time or from time to time,
for up to twenty (20)
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<PAGE> 3
consecutive quarterly interest payment periods with respect to each deferral
period (each an "Extension Period"), during which Extension Periods the Company
shall have the right to make partial payments of interest on any Interest
Payment Date, and at the end of which the Company shall pay all interest then
accrued and unpaid (together with Additional Interest thereon to the extent
permitted by applicable law); provided, however, that no Extension Period shall
extend beyond the Stated Maturity of the principal of this Security; provided,
further, that during any such Extension Period, the Company shall not, and shall
not permit any Subsidiary of the Company to, (i) declare or pay any dividends or
distributions on or redeem, purchase, acquire or make a liquidation payment with
respect to, any of the Company's capital stock or (ii) make any payment of
principal of or interest or premium, if any, on or repay, repurchase or redeem
any debt security of the Company that ranks pari passu with or junior in
interest to this Security or (iii) make any guarantee payments with respect to
any guarantee by the Company of the debt securities of any Subsidiary of the
Company if such guarantee ranks pari passu with or junior in interest to this
Security (other than (a) dividends or distributions in the Company's capital
stock, (b) any declaration of a dividend in connection with the implementation
of a Rights Plan or the redemption or repurchase of any rights distributed
pursuant to a Rights Plan, (c) payments under the Guarantee with respect to this
Security, and (d) purchases of Common Stock related to the issuance of Common
Stock or rights under any of the Company's benefit plans for its directors,
officers or employees, related to the issuance of Common Stock or rights under a
dividend reinvestment and stock purchase plan, or related to the issuance of
Common Stock (or securities convertible or exchangeable for Common Stock) as
consideration in an acquisition transaction that was entered into prior to the
commencement of such Extension Period). Prior to the termination of any such
Extension Period, the Company may further defer the payment of interest,
provided that no Extension Period shall exceed twenty (20) consecutive quarterly
periods or extend
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<PAGE> 4
beyond the Stated Maturity of the principal of this Security. Upon the
termination of any such Extension Period and upon the payment of all accrued and
unpaid interest and any Additional Interest then due, the Company may elect to
begin a new Extension Period, subject to the above requirements. No interest
shall be due and payable during an Extension Period except at the end thereof.
The Company shall give the 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 or, with respect to the Securities issued to a
Trust, so long as such Securities are held by such Trust, prior to the earlier
of (i) the next succeeding date on which Distributions on the Preferred
Securities would be payable but for such deferral or (ii) the date the
Administrative Trustees are required to give notice to any securities exchange
or other applicable self-regulatory organization or to holders of such Preferred
Securities of the record date or the date such Distributions are payable, but in
any event not less than one Business Day prior to such record date.
Payment of principal of (and premium, if any) and interest on
this Security will be made at the office or agency of the Company maintained for
that purpose in the United States, in such coin or currency of the United States
of America as at the time of payment is legal tender for payment of public and
private debts; provided, however, that at the option of the Company payment of
interest may be made (i) by check mailed to the address of the Person entitled
thereto as such address shall appear in the Securities Register or (ii) by wire
transfer in immediately available funds at such place and to such account as may
be designated in writing at least 15 days before the relevant Interest Payment
Date by the Person entitled thereto as specified in the Securities Register.
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<PAGE> 5
The indebtedness evidenced by this Security is, to the extent
provided in the Indenture, subordinate and subject in right of payments to the
prior payment in full of all Senior Debt, and this Security is issued subject to
the provisions of the Indenture with respect thereto. Each Holder of this
Security, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on his behalf to take such
actions as may be necessary or appropriate to effectuate the subordination so
provided and (c) appoints the Trustee his attorney-in-fact for any and all such
purposes. Each Holder hereof, by his acceptance hereof, waives all notice of the
acceptance of the subordination provisions contained herein and in the Indenture
by each holder of Senior Debt, 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 Company has caused this instrument to
be duly executed under its corporate seal.
USBANCORP, INC.
By:_______________________________
[President or Vice President]
Attest:
__________________________________
[Secretary or Assistant Secretary]
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<PAGE> 6
This is one of the Securities referred to in the within
mentioned Indenture.
Dated:
THE BANK OF NEW YORK
as Trustee
By:_______________________________
Authorized Signatory
6
<PAGE> 7
This Security is one of a duly authorized issue of securities
of the Company (herein called the "Securities"), issued and to be issued in one
or more series under a Junior Subordinated Indenture, dated as of April 1, 1998
(herein called the "Indenture"), between the Company and The Bank of New York,
as Trustee (herein called the "Trustee", which term includes any successor
trustee under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Trustee, the
Company and the Holders of the Securities, and of the terms upon which the
Securities are, and are to be, authenticated and delivered. This Security is one
of the series designated on the face hereof, limited in aggregate principal
amount to $30,927,850.
All terms used in this Security that are defined in the
Indenture or in the Amended and Restated Trust Agreement, dated as of
_____________, 1998, as amended (the "Trust Agreement"), for USBANCORP Capital
Trust 1, among USBANCORP, Inc., as Depositor, and the Trustees named therein,
shall have the meanings assigned to them in the Indenture or the Trust
Agreement, as the case may be.
The Company may at any time, at its option, on or after June
30, 2003, 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, without premium or penalty, at a redemption price equal to 100% of the
principal amount thereof plus accrued and unpaid interest, including Additional
Interest, if any, to the Redemption Date.
Upon the occurrence and during the continuation of a Tax Event
or a Capital Treatment Event in respect of a Trust, the Company may, at its
option, at any time within 90 days of the occurrence of such Tax Event or
Capital Treatment Event redeem this Security, in whole but not in part, subject
to the
7
<PAGE> 8
provisions of Section 11.7 and the other provisions of Article XI of the
Indenture, at a redemption price equal to 100% of the principal amount thereof
plus accrued and unpaid interest, including Additional Interest, if any, to the
Redemption Date.
This Security shall be subject to partial redemption only in
the amount of $25, or integral multiples thereof.
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
Company with certain conditions set forth in the Indenture.
The Indenture permits, with certain exceptions as therein
provided, the Company 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 Company 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 all 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 all series at the
time Outstanding, on behalf of the Holders of all Securities of such series, to
waive compliance by the Company 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
8
<PAGE> 9
hereof 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, -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 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 Company (and to the Trustee
if given by Holders), provided that, in the case of the Securities of this
series issued to a 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 this series fails to declare the principal of all the Securities of this
series to be immediately due and payable, the holders of at least 25% in
aggregate Liquidation Amount of the Preferred Securities then outstanding shall
have such right by a notice in writing to the Company 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.]
[If the Security is a Discount Security, -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 such portion of the principal amount as may be specified in the terms of
this series may declare an amount of principal of the Securities of this series
to be due and payable immediately, by a notice in writing to the Company (and to
the Trustee if given by Holders), provided
9
<PAGE> 10
that, in the case of the Securities of this series issued to a 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 this series fails to declare the
principal of all the Securities of this series to be immediately due and
payable, the holders of at least 25% in aggregate Liquidation Amount of the
Preferred Securities then outstanding shall have such right by a notice in
writing to the Company and the Trustee. Such amount shall be equal to - insert
formula for determining the amount. Upon any such declaration, such amount of
the principal 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. Upon payment (i) of the amount of principal so
declared due and payable and (ii) of interest on any overdue principal and
overdue interest (in each case to the extent that the payment of such interest
shall be legally enforceable), all of the Company's obligations in respect of
the payment of the principal of and interest, if any, on this Security shall
terminate.]
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of (and
premium, if any) and interest on this Security at the times, place and rate, and
in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is registrable in
the Securities Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company maintained under Section 10.2 of
the Indenture duly endorsed by, or accompanied by a written instrument of
transfer
10
<PAGE> 11
in form satisfactory to the Company and the Securities Registrar duly executed
by, the Holder hereof or his attorney duly authorized in writing, and thereupon
one or more new Securities of this series, of authorized denominations and for
the same aggregate principal amount, will be issued to the designated transferee
or transferees. No service charge shall be made for any such registration of
transfer or exchange, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
The Securities of this series are issuable only in registered
form without coupons in denominations of $ and any integral multiple
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 such series of a different authorized
denomination, as requested by the Holder surrendering the same.
The Company 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.
No recourse shall be had for the payment of the principal of
or premium, if any, or interest on this Security, or for any claim based hereon,
or otherwise in respect hereof, or based on or in respect of the Indenture,
against any incorporator,
11
<PAGE> 12
stockholder, officer or director, past, present or future, as such, of the
Company or of any predecessor or successor Person, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or
penalty or otherwise, all such liability being, by the acceptance hereof and as
part of the consideration for the issuance hereof, expressly waived and
released.
THE INDENTURE AND THIS SECURITY SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO
CONFLICTS OF LAWS PRINCIPLES THEREOF.
12
<PAGE> 1
Exhibit 4.3
CERTIFICATE OF TRUST OF
USBANCORP CAPITAL TRUST I
THIS Certificate of Trust of USBANCORP Capital Trust I (the "Trust") is
being duly executed and filed by The Bank of New York (Delaware), The Bank of
New York, Terry K. Dunkle, Jeffrey A. Stopko and Anthony M. V. Eramo, as
trustees, to form a business trust under the Delaware Business Trust Act (12
Del. C. Section 3801 et seq.).
1. Name. The name of the business trust formed hereby is USBANCORP
Capital Trust I.
2. Delaware Trustee. The name and business address of the trustee of
the Trust in the State of Delaware is The Bank of New York (Delaware), White
Clay Center, Newark, Delaware 19711.
3. Effective Date. This Certificate of Trust shall be effective upon
filing with the Secretary of State.
IN WITNESS WHEREOF, the undersigned, being the trustees of the Trust,
have executed this Certificate of Trust as of the date first above written.
THE BANK OF NEW YORK (DELAWARE),
not in its individual capacity but solely as
Trustee of the Trust
By:____________________________________
Name:
Title:
THE BANK OF NEW YORK, not in its
individual capacity but solely as Trustee of the
Trust
By:____________________________________
Name:
Title:
<PAGE> 2
------------------------------------
TERRY K. DUNKLE, not in his individual
capacity but solely as Trustee of the Trust
------------------------------------
JEFFREY A. STOPKO, not in his individual
capacity but solely as Trustee of the Trust
------------------------------------
ANTHONY M. V. ERAMO, not in his
individual capacity but solely as Trustee of the
Trust
<PAGE> 1
Exhibit 4.4
TRUST AGREEMENT
This TRUST AGREEMENT, dated as of April 15, 1998 (this "Trust
Agreement"), among (i) USBANCORP, Inc., a Pennsylvania corporation (the
"Depositor"), (ii) The Bank of New York (Delaware), a Delaware banking
corporation, as trustee, (iii) The Bank of New York, a New York banking
corporation, as trustee, and (iv) Terry K. Dunkle, Jeffrey A. Stopko and Anthony
M. V. Eramo, each an individual, as trustees (each of such trustees in (ii),
(iii) and (iv) a "Trustee" and collectively, the "Trustees"). The Depositor and
the Trustees hereby agree as follows:
1. The trust created hereby (the "Trust") shall be known as
"USBANCORP Capital Trust I" in which name the Trustees, or the Depositor to the
extent provided herein, may engage in the transactions contemplated hereby, make
and execute contracts, and sue and be sued.
2. The Depositor hereby assigns, transfers conveys and sets
over to the Trustees the sum of $10. The Trustees hereby acknowledge receipt of
such amount in trust from the Depositor, which amount shall constitute the
initial trust estate. The Trustees hereby declare that they will hold the trust
estate in trust for the Depositor. 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. Section 3801, et seq. (the "Business
Trust Act"), and that this document constitutes the governing instrument of the
Trust. The Trustees are 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 Trustees 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 Trustees shall not have any duty or obligation hereunder or
with respect to the trust estate, except as otherwise required by applicable law
or as may be necessary to obtain prior to such execution and delivery of any
licenses, consents or approvals required by applicable law or otherwise.
4. The Depositor, as the sponsor of the Trust, is hereby
authorized (i) to file with the Securities and Exchange Commission (the
"Commission") and execute, in each case on behalf of the Trust, (a) the
Registration Statement on Form S-3 (the "1933 Act Registration Statement"),
including any pre-effective or post-effective amendments to the 1933 Act
Registration Statement, relating to the registration under the Securities Act of
1933, as amended, of the Capital Securities of the Trust and possibly certain
other securities and (b) a Registration Statement on Form 8-A (the "1934 Act
Registration 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 any other national stock exchange or The
Nasdaq National Market (each, an "Exchange") and execute on behalf of the Trust
one or more listing applications and all other applications, statements,
<PAGE> 2
certificates, agreements and other instruments as shall be necessary or
desirable to cause the Capital Securities to be listed on any of the Exchanges;
(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 as shall be necessary or desirable to
register the Capital Securities under the securities or blue sky laws of such
jurisdictions as the Depositor, on behalf of the Trust, may deem necessary or
desirable and (iv) to execute on behalf of the Trust that certain Underwriting
Agreement relating to the Capital Securities, among the Trust, the Depositor and
the several Underwriters named therein, substantially in the form included as an
exhibit to the 1933 Act Registration Statement. In the event that any filing
referred to in clauses (i), (ii) and (iii) above is required by the rules and
regulations of the Commission, an Exchange or state securities or blue sky laws,
to be executed on behalf of the Trust by one or more of the Trustees, each of
the individual Trustees, in his capacity as a Trustee of the Trust, is hereby
authorized and directed to join in any such filing and to execute on behalf of
the Trust any and all of the foregoing. In connection with the filings referred
to above, the Depositor and Terry K. Dunkle, Jeffrey A. Stopko and Anthony M. V.
Eramo, each as a Trustee and not in his individual capacity, hereby constitutes
and appoints Terry K. Dunkle, Jeffrey A. Stopko and Anthony M. V. Eramo, and
each of them, as their true and lawful attorneys-in-fact and agents, with full
power of substitution and resubstitution, for the Depositor or such Trustee or
in the Depositor's or such Trustee's name, place and stead, in any and all
capacities, to sign any and all amendments (including post-effective amendments)
to the 1933 Act Registration Statement and the 1934 Act Registration Statement
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Commission, the Exchanges and administrators of
state securities or blue sky laws, granting unto said attorneys-in-fact and
agents full power and authority to do and perform each and every act and thing
requisite and necessary to be done in connection therewith, as fully to all
intents and purposes as the Depositor or such Trustee might or could to in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents or any of them, or their respective substitute or substitutes, shall do
or cause to be done by virtue hereof.
5. This Trust Agreement may be executed in one or more
counterparts.
6. The number of Trustees initially shall be five (5) and
thereafter the number of Trustees 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; provided, however, that to the extent
required by the Business Trust Act, one Trustee 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 and
otherwise meets the requirements of applicable Delaware law. Subject to the
foregoing, the Depositor is entitled to appoint or remove without cause any
Trustee at any time. The Trustees may resign upon thirty (30) days' prior notice
to the Depositor.
2
<PAGE> 3
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 of principles).
IN WITNESS WHEREOF, the parties hereto have caused this Trust Agreement
to be duly executed as of the day and year first above written.
USBANCORP, as Depositor
By: _________________________
Name:
Title:
The Bank of New York (Delaware), as
Trustee of the Trust
By: __________________________
Name:
Title:
The Bank of New York, as Trustee of the
Trust
By: __________________________
Name:
Title:
_________________________________
Terry K. Dunkle, as Trustee of the Trust
_________________________________
Jeffrey A. Stopko, as Trustee of the Trust
_________________________________
Anthony M. V. Eramo, as Trustee of the Trust
3
<PAGE> 1
Exhibit 4.5
AMENDED AND RESTATED
TRUST AGREEMENT
among
USBANCORP, INC., as Depositor,
THE BANK OF NEW YORK,
as Property Trustee,
THE BANK OF NEW YORK (DELAWARE),
as Delaware Trustee,
THE ADMINISTRATIVE TRUSTEES NAMED HEREIN,
and
THE SEVERAL HOLDERS (AS DEFINED HEREIN)
Dated as of April __, 1998
USBANCORP CAPITAL TRUST I
<PAGE> 2
USBANCORP CAPITAL TRUST I
Certain Sections of this Trust Agreement relating to
Sections 310 through 318 of the
Trust Indenture Act of 1939:
<TABLE>
<CAPTION>
Trust Indenture Trust Agreement
Act Section Section
- ----------- -------
<S> <C>
(Section) 310(a)(1).................................................................. 8.7
(a)(2).................................................................. 8.7
(a)(3).................................................................. 8.9
(a)(4).................................................................. 2.7(a)(ii)
(b)..................................................................... 8.8
(Section) 311(a)..................................................................... 8.13
(b)..................................................................... 8.13
(Section) 312(a)..................................................................... 5.7
(b)..................................................................... 5.7
(c)..................................................................... 5.7
(Section) 313(a)..................................................................... 8.14(a)
(a)(4).................................................................. 8.14(b)
(b)..................................................................... 8.14(b)
(c)..................................................................... 10.9
(d)..................................................................... 8.14(c)
(Section) 314(a)..................................................................... 8.15
(b)..................................................................... Not Applicable
(c)(1).................................................................. 8.16
(c)(2).................................................................. 8.16
(c)(3).................................................................. Not Applicable
(d)..................................................................... Not Applicable
(e)..................................................................... 1.1, 8.16
(Section) 315(a)..................................................................... 8.1(a), 8.3(a)
(b)..................................................................... 8.2, 10.9
(c)..................................................................... 8.1(a)
(d)..................................................................... 8.1, 8.3
(e)..................................................................... Not Applicable
</TABLE>
<PAGE> 3
<TABLE>
<CAPTION>
<S> <C>
(Section) 316(a)............................................................... Not Applicable
(a)(1)(A)......................................................... Not Applicable
(a)(1)(B)......................................................... Not Applicable
(a)(2)............................................................ Not Applicable
(b)............................................................... 5.14
(c)............................................................... 6.7
(Section) 317(a)(1)............................................................ Not Applicable
(a)(2)............................................................ Not Applicable
(b)............................................................... 5.9
(Section) 318(a)............................................................... 10.11
</TABLE>
<PAGE> 4
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
ARTICLE I - Defined Terms...................................................................................... 1
Section 1.1 Definitions.............................................................................. 1
ARTICLE II - Continuation of the Trust......................................................................... 11
Section 2.1 Name..................................................................................... 11
Section 2.2 Office of the Delaware Trustee; Principal
Place of Business................................................................................... 12
Section 2.3 Initial Contribution of Trust Property;
Organizational Expenses............................................................................. 12
Section 2.4 Issuance of the Capital Securities....................................................... 12
Section 2.5 Issuance of the Common Securities;
Subscription and Purchase of Debentures............................................................. 12
Section 2.6 Declaration of Trust..................................................................... 13
Section 2.7 Authorization to Enter into Certain
Transactions........................................................................................ 13
Section 2.8 Assets of Trust.......................................................................... 17
Section 2.9 Title to Trust Property.................................................................. 17
ARTICLE III - Payment Account.................................................................................. 17
Section 3.1 Payment Account.......................................................................... 17
ARTICLE IV - Distributions; Redemption......................................................................... 18
Section 4.1 Distributions............................................................................ 18
Section 4.2 Redemption............................................................................... 19
Section 4.3 Subordination of Common Securities....................................................... 21
Section 4.4 Payment Procedures....................................................................... 22
Section 4.5 Tax Returns and Reports.................................................................. 22
Section 4.6 Payment of Expenses of the Trust......................................................... 22
Section 4.7 Payments under Indenture or Pursuant to
Direct Actions...................................................................................... 23
ARTICLE V - Trust Securities Certificates...................................................................... 23
Section 5.1 Initial Ownership........................................................................ 23
Section 5.2 The Trust Securities Certificates........................................................ 23
Section 5.3 Execution and Delivery of Trust Securities
Certificates........................................................................................ 24
Section 5.4 Registration of Transfer and Exchange of
Capital Securities Certificates..................................................................... 24
Section 5.5 Mutilated, Destroyed, Lost or Stolen Trust
Securities Certificates............................................................................. 25
Section 5.6 Persons Deemed Securityholders........................................................... 26
Section 5.7 Access to List of Securityholders' Names
and Addresses....................................................................................... 26
</TABLE>
(i)
<PAGE> 5
<TABLE>
<CAPTION>
<S> <C>
Section 5.8 Maintenance of Office or Agency.......................................................... 26
Section 5.9 Appointment of Paying Agent.............................................................. 26
Section 5.10 Ownership of Common Securities by
Depositor........................................................................................... 27
Section 5.11 Book-Entry Capital Securities
Certificates; Common Securities Certificate......................................................... 27
Section 5.12 Notices to Clearing Agency.............................................................. 28
Section 5.13 Definitive Capital Securities
Certificates........................................................................................ 28
Section 5.14 Rights of Securityholders............................................................... 29
Section 5.15 CUSIP Numbers........................................................................... 32
ARTICLE VI - Acts of Securityholders; Meetings; Voting......................................................... 32
Section 6.1 Limitations on Voting Rights............................................................. 32
Section 6.2 Notice of Meetings....................................................................... 33
Section 6.3 Meetings of Capital Securityholders...................................................... 33
Section 6.4 Voting Rights............................................................................ 34
Section 6.5 Proxies, etc............................................................................. 34
Section 6.6 Securityholder Action by Written Consent................................................. 35
Section 6.7 Record Date for Voting and Other Purposes................................................ 35
Section 6.8 Acts of Securityholders.................................................................. 35
Section 6.9 Inspection of Records.................................................................... 36
ARTICLE VII - Representations and Warranties................................................................... 36
Section 7.1 Representations and Warranties of the
Property Trustee and the Delaware Trustee........................................................... 36
Section 7.2 Representations and Warranties of
Depositor........................................................................................... 38
ARTICLE VIII - The Trustees.................................................................................... 38
Section 8.1 Certain Duties and Responsibilities...................................................... 38
Section 8.2 Certain Notices.......................................................................... 40
Section 8.3 Certain Rights of Property Trustee....................................................... 40
Section 8.4 Not Responsible for Recitals or Issuance
of Securities....................................................................................... 43
Section 8.5 May Hold Securities...................................................................... 43
Section 8.6 Compensation; Indemnity; Fees............................................................ 43
Section 8.7 Corporate Property Trustee Required;
Eligibility of Trustees............................................................................. 44
Section 8.8 Conflicting Interests.................................................................... 45
Section 8.9 Co-Trustees and Separate Trustee......................................................... 45
Section 8.10 Resignation and Removal; Appointment of
Successor........................................................................................... 47
Section 8.11 Acceptance of Appointment by Successor.................................................. 48
Section 8.12 Merger, Conversion, Consolidation or
Succession to Business.............................................................................. 49
Section 8.13 Preferential Collection of Claims Against
Depositor or Trust.................................................................................. 49
Section 8.14 Reports by Property Trustee............................................................. 50
Section 8.15 Reports to the Property Trustee......................................................... 51
</TABLE>
(ii)
<PAGE> 6
<TABLE>
<CAPTION>
<S> <C>
Section 8.16 Evidence of Compliance with Conditions
Precedent........................................................................................... 51
Section 8.17 Number of Trustees...................................................................... 51
Section 8.18 Delegation of Power..................................................................... 52
ARTICLE IX - Termination, Liquidation and Merger............................................................... 52
Section 9.1 Termination Upon Expiration Date......................................................... 52
Section 9.2 Early Termination........................................................................ 52
Section 9.3 Termination.............................................................................. 53
Section 9.4 Liquidation.............................................................................. 53
Section 9.5 Mergers, Consolidations, Amalgamations or
Replacements of the Trust........................................................................... 55
ARTICLE X - Miscellaneous Provisions........................................................................... 56
Section 10.1 Limitation of Rights of Securityholders................................................. 56
Section 10.2 Liability of the Common Securityholder................................................... 56
Section 10.3 Amendment............................................................................... 56
Section 10.4 Separability............................................................................ 58
Section 10.5 Governing Law........................................................................... 58
Section 10.6 Payments Due on Non-Business Day........................................................ 58
Section 10.7 Successors.............................................................................. 58
Section 10.8 Headings................................................................................ 58
Section 10.9 Reports, Notices and Demands............................................................ 58
Section 10.10 Agreement Not to Petition.............................................................. 59
Section 10.11 Trust Indenture Act; Conflict with Trust
Indenture Act....................................................................................... 60
Section 10.12 Acceptance of Terms of Trust Agreement,
Guarantee and Indenture............................................................................. 60
Section 10.13 Holders are Parties.................................................................... 60
Section 10.14 Counterparts........................................................................... 61
</TABLE>
(iii)
<PAGE> 7
AMENDED AND RESTATED TRUST AGREEMENT, dated as of April __, 1998, among
(i) USBANCORP, INC., a Pennsylvania corporation, (including any successors or
assigns, the "Depositor"), (ii) The Bank of New York, a New York banking
corporation, as property trustee (in each such capacity, the "Property Trustee"
and, in its separate corporate capacity and not in its capacity as Property
Trustee, the "Bank"), (iii) The Bank of New York (Delaware), a banking
corporation organized under the laws of the State of Delaware, as Delaware
trustee (the "Delaware Trustee"), (iv) TERRY K. DUNKLE, an individual, JEFFREY
A. STOPKO, an individual and ANTHONY M. V. ERAMO, an individual, each of whose
address is c/o USBANCORP, INC., Main and Franklin Streets, Johnstown,
Pennsylvania 15907-0430 (each an "Administrative Trustee" and collectively the
"Administrative Trustees") (the Property Trustee, the Delaware Trustee and the
Administrative Trustees referred to collectively as the "Trustees") and (v) 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 that certain Trust Agreement, dated as of April __,
1998 (the "Original Trust Agreement"), and by the execution and filing with the
Secretary of State of the State of Delaware of the Certificate of Trust, filed
on April __, 1998, attached as Exhibit A (the "Certificate of Trust"); and
WHEREAS, the Depositor and the 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 Trust to
the Depositor, (ii) the issuance and sale of the Capital Securities by the Trust
pursuant to the Underwriting Agreement and (iii) the acquisition by the Trust
from the Depositor of all of the right, title and interest in the Debentures;
NOW, THEREFORE, in consideration of the agreements and obligations set
forth herein and for other good and valuable consideration, the sufficiency of
which is hereby acknowledged, each party, for the benefit of the other parties
and for the benefit of the Securityholders, 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:
1
<PAGE> 8
(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;
(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) 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 Trust Agreement; and
(d) the words "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.
"Administrative Trustee" means each of the individuals identified as an
"Administrative Trustee" in the preamble to this Trust Agreement solely in such
individual's capacity as Administrative Trustee of the Trust and not in such
individual's individual capacity, or such Administrative Trustee's successor in
interest in such capacity, or any successor trustee 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.
"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
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<PAGE> 9
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 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 such committee of the 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 Trustees.
"Book-Entry Capital Securities Certificates" means a beneficial
interest in the Capital Securities Certificates, ownership and transfers of
which shall be made through book entries by a Clearing Agency as described in
Section 5.11.
"Business Day" means a day (a) other than (i) a Saturday or Sunday and
(ii) a day that is not a day on which banking institutions in The City of New
York are authorized or required by law or executive order to remain closed.
"Capital Security" means an undivided beneficial interest in the assets
of the Trust, having a Liquidation Amount of $25 and having the rights provided
therefor in this Trust Agreement, including the right to receive Distributions
and a Liquidation Distribution as provided herein.
"Capital Securities Certificate" means a certificate evidencing
ownership of Capital Securities, substantially in the form attached as Exhibit
D.
"Capital Treatment Event" means the reasonable determination
by the Depositor that, as a result of any amendment to, or change
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<PAGE> 10
(including any proposed change) in, the laws (or any regulations thereunder) of
the United States or any political subdivision thereof or therein, or as a
result of any official or administrative pronouncement or action or judicial
decision interpreting or applying such laws or regulations, which amendment or
change is effective or such proposed change, pronouncement, action or decision
is announced on or after the date of issuance of the Capital Securities
hereunder, there is more than an insubstantial risk that the Depositor will not
be entitled to treat an amount equal to the Liquidation Amount of the Capital
Securities as "Tier 1 Capital" (or the then equivalent thereof) for purposes of
the capital adequacy guidelines of the Federal Reserve, as then in effect and
applicable to the Depositor.
"Certificate Depository Agreement" means the agreement among the Trust,
the Depositor and The Depository Trust Company, as the initial Clearing Agency,
dated as of the Closing Date, relating to the Trust Securities Certificates,
substantially in the form attached as Exhibit B, as the same may be amended and
supplemented from time to time.
"Certificate of Trust" has the meaning specified in the recitals
hereof, as amended from time to time.
"Clearing Agency" means an organization registered as a "clearing
agency" pursuant to Section 17A of the Securities Exchange Act of 1934, as
amended. The Depository Trust Company 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 date of execution and delivery of this Trust
Agreement.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commission" means the Securities and Exchange Commission, as from time
to time constituted, created under the Securities Exchange Act of 1934, as
amended, or, if at any time after the execution of this instrument such
Commission is not existing and performing the duties now assigned to it under
the Trust Indenture Act, then the body performing such duties at such time.
"Common Securities 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 Trust, having a Liquidation Amount of $25 and having the rights provided
therefor in this Trust Agreement,
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including the right to receive Distributions and a Liquidation Distribution as
provided herein.
"Corporate Trust Office" means (i) when used with respect to the
Property Trustee, the principal corporate trust office of the Property Trustee
located in New York, New York, and (ii) when used with respect to the Debenture
Trustee, the principal corporate trust office of the Debenture Trustee located
in New York, New York.
"Debenture Event of Default" means an "Event of Default" as
defined in the Indenture.
"Debenture Maturity Date" means the date specified pursuant to the
terms of the Debentures as the date on which the principal of the Debentures is
due and payable.
"Debenture Redemption Date" means, with respect to any Debentures to be
redeemed under the Indenture, the date fixed for redemption under the Indenture.
"Debenture Tax Event" means a "Tax Event" as defined in the
Indenture.
"Debenture Trustee" means The Bank of New York, a New York banking
corporation, as trustee under the Indenture, and any successor trustee appointed
as provided therein.
"Debentures" means the $____________ aggregate principal amount of the
Depositor's _____% Junior Subordinated Deferrable Interest Debentures, Series A,
issued pursuant to the Indenture.
"Definitive Capital Securities Certificates" means either or both (as
the context requires) of (a) Capital Securities Certificates issued as
Book-Entry Capital Securities Certificates as provided in Section 5.11(a) and
(b) Capital Securities Certificates issued in certificated, fully registered
form as provided in Section 5.13.
"Delaware Business Trust Act" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. C. 3801, et seq., as it may be 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 and not in its individual capacity, or its
successor in interest in such capacity, or any successor trustee appointed as
herein provided.
"Depositor" has the meaning specified in the preamble to
this Trust Agreement.
"Distribution Date" has the meaning specified in Section
4.1(a).
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"Distributions" means amounts payable in respect of the Trust
Securities as provided in Section 4.1.
"Early Termination Event" has the meaning specified in Section 9.2.
"Event of Default" 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):
(a) the occurrence of a Debenture Event of Default; or
(b) default by the Property Trustee 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 Property Trustee 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 Trustees in this Trust Agreement
(other than a covenant or warranty a default in the performance or breach of
which is dealt with in clause (b) or (c) above) and continuation of such default
or breach for a period of 90 days after there has been given, by registered or
certified mail, to the defaulting Trustee or Trustees 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
(e) the occurrence of a Bankruptcy Event with respect to the
Property Trustee and the failure by the Depositor to appoint a successor
Property Trustee within 90 days thereof.
"Expiration Date" has the meaning specified in Section 9.1.
"Federal Reserve" means the Board of Governors of the Federal Reserve
System, as from time to time constituted, or if at any time after the execution
of this Trust Agreement the Federal Reserve is not existing and performing the
duties now assigned to it, then the body performing such duties at such time.
"Guarantee" means the Guarantee Agreement executed and delivered by the
Depositor and The Bank of New York, as trustee, contemporaneously with the
execution and delivery of this Trust Agreement, for the benefit of the Holders
of the Trust Securities, as amended from time to time.
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"Indenture" means the Junior Subordinated Indenture, dated as of April
1, 1998, between the Depositor and the Debenture Trustee, as trustee, as amended
or supplemented from time to time.
"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 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, and (b) with respect to a distribution of Debentures to
Holders of Trust Securities in connection with a dissolution or liquidation of
the Trust, Debentures having a principal amount equal to the Liquidation Amount
of the Trust Securities of the Holder to whom such Debentures are distributed.
"Liquidation Amount" means the stated amount of $25 per Trust Security.
"Liquidation Date" means the date on which Debentures are to be
distributed to Holders of Trust Securities in connection with a termination and
liquidation of the Trust pursuant to Section 9.4(a).
"Liquidation Distribution" has the meaning specified in Section 9.4(d).
"1940 Act" means the Investment Company Act of 1940, as amended.
"Officers' Certificate" means a certificate signed by the Chairman and
Chief Executive Officer, Vice Chairman, President, or a Vice President, and by
the Treasurer, an Associate Treasurer, an Assistant Treasurer, the Controller,
the Secretary or an Assistant Secretary, of the Depositor, and delivered to the
appropriate Trustee. One of the officers signing an Officers' Certificate given
pursuant to Section 8.16 shall be the principal executive, financial or
accounting officer of the Depositor. Any Officers' Certificate delivered with
respect to compliance with a condition or covenant provided for in this Trust
Agreement shall be without personal liability and shall include:
(a) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions relating
thereto;
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<PAGE> 14
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Officers' Certificate;
(c) a statement that each such officer has made such examination or
investigation as, in such officer's opinion, is necessary to enable such officer
to express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(d) a statement as to whether, in the opinion of each such officer,
such condition or covenant has been complied with.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Trust, the Property Trustee or the Depositor, and who shall be
reasonably acceptable to the Property Trustee.
"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 cancelled by the Securities Registrar
or delivered to the Securities Registrar 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 for the Holders of such Trust Securities; 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 which have been paid or in exchange for or in lieu
of which other Trust Securities have been executed and delivered pursuant to
this Trust Agreement, including pursuant to Sections 5.4, 5.5, 5.11 and 5.13;
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 Trustee or any Affiliate of the Depositor
or any Trustee shall be disregarded and deemed not to be Outstanding, except
that (a) in determining whether any Trustee shall be protected in relying upon
any such request, demand, authorization, direction, notice, consent or waiver,
only Capital Securities that such Trustee actually 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
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are owned by the Depositor, one or more of the Trustees and/or any such
Affiliate. Capital Securities so owned which have been pledged in good faith may
be regarded as Outstanding if the pledgee establishes to the satisfaction of the
Administrative Trustees 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 a Book-Entry
Capital Securities Certificate as reflected in the records of the Clearing
Agency or, if a Clearing Agency Participant is not the beneficial 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 5.9 and shall initially be the Bank.
"Payment Account" means a segregated non-interest-bearing corporate
trust account maintained by the Property Trustee with the Bank in its corporate
trust department for the benefit of the Securityholders 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 Securityholders in
accordance with Sections 4.1 and 4.2.
"Person" means any individual, corporation, partnership, joint venture,
trust, limited liability company or corporation, unincorporated organization or
government or any agency or political subdivision thereof.
"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 created 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 Debenture
Maturity Date 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, paid by the Depositor upon the concurrent
redemption of a Like Amount of Debentures, allocated on a pro rata basis (based
on Liquidation Amounts) among the Trust Securities.
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"Relevant Trustee" shall have the meaning specified in
Section 8.10.
"Securities Register" and "Securities Registrar" have the respective
meanings specified in Section 5.4.
"Securityholder" or "Holder" means a Person in whose name a Trust
Security or Trust Securities is registered in the Securities Register; any such
Person shall be a beneficial owner within the meaning of the Delaware Business
Trust Act; provided, however, that in determining whether the Holders of the
requisite amount of Capital Securities have voted on any matter provided for in
this Trust Agreement, then for the purpose of any such determination, so long as
Definitive Capital Securities Certificates have not been issued, the term
Securityholders or Holders as used herein shall refer to the Owners.
"Tax Event" means the receipt by the Trust of an Opinion of Counsel
experienced in such matters to the effect that, as a result of any amendment to,
or change (including any announced proposed change) in, the laws (or any
regulations thereunder) of the United States or any political subdivision or
taxing authority thereof or therein, or as a result of any official
administrative pronouncement or judicial decision interpreting or applying such
laws or regulations, which amendment or change is effective or which proposed
change, pronouncement or decision is announced on or after the date of issuance
of the Capital Securities under this Trust Agreement, there is more than an
insubstantial risk that (i) the Trust is, or will be within 90 days after the
date of such Opinion of Counsel, subject to United States federal income tax
with respect to income received or accrued on the Debentures, (ii) interest
payable by the Depositor on the Debentures is not, or within 90 days after the
date of such Opinion of Counsel, will not be, deductible by the Depositor, in
whole or in part, for United States federal income tax purposes or (iii) the
Trust is, or will be within 90 days after the date of such Opinion of Counsel,
subject to more than a de minimis amount of other taxes, duties or other
governmental charges.
"Trust" means the Delaware business trust continued hereby and
identified on the cover page to this Trust 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 hereto 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;
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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.
"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.
"Trust Securities Certificate" means any one of the Common Securities
Certificates or the Capital Securities Certificates.
"Trust Security" means any one of the Common Securities or the Capital
Securities.
"Trustees" means, collectively, the Property Trustee, the Delaware
Trustee and the Administrative Trustees.
"Underwriting Agreement" means the Pricing Agreement, dated as of April
__, 1998, among the Trust, the Depositor and CIBC Oppenheimer Corp. and Legg
Mason Wood Walker, Inc., as representatives of the underwriters named therein.
ARTICLE II
Continuation of the Trust
Section 2.1 Name.
The Trust continued hereby shall be known as "USBANCORP Capital Trust
I," as such name may be modified from time to time by the Administrative
Trustees following written notice to the Holders of Trust Securities and the
other Trustees, in which name the Trustees engage in the transactions
contemplated hereby, make and execute contracts and other instruments on behalf
of the 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 c/o The
Bank of New York (Delaware), White Clay Center, Route 273, Newark, Delaware
19711, Attention: Corporate Trust Department, or such other address in the State
of Delaware as the Delaware Trustee may designate by written notice to the
Securityholders and the Depositor. The principal executive office of the Trust
is c/o The Bank of New York (Delaware), White Clay Center, Route 273, Newark,
Delaware 19711, Attention: Corporate Trust Department.
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Section 2.3 Initial Contribution of Trust Property; Organizational
Expenses.
The Property Trustee acknowledges receipt in trust 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 Trust as they arise or shall, upon request of any Trustee,
promptly reimburse such Trustee for any such expenses paid by such 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.
As of April __, 1998, the Depositor, on behalf of the Trust and
pursuant to the Original Trust Agreement, executed and delivered the
Underwriting Agreement. Contemporaneously with the execution and delivery of
this Trust Agreement, an Administrative Trustee, on behalf of the Trust, shall
execute in accordance with Section 5.2 and deliver to the Underwriters named in
the Underwriting Agreement Capital Securities Certificates, registered in the
name of the nominee of the initial Clearing Agency, in an aggregate amount of
___________ Capital Securities having an aggregate Liquidation Amount of
$__________, against receipt of an aggregate purchase price plus accrued
distributions from April __, 1998, if any, of such Capital Securities of
$__________ which amount such Administrative Trustee shall promptly deliver to
the Property Trustee together with an order from the Administrative Trustees
directing the Property Trustee to authenticate such capital securities.
Section 2.5 Issuance of the Common Securities; Subscription
and Purchase of Debentures.
Contemporaneously with the execution and delivery of this Trust
Agreement, an Administrative Trustee, on behalf of the Trust, shall execute in
accordance with Section 5.2 and deliver to the Depositor Common Securities
Certificates, registered in the name of the Depositor, in an aggregate amount of
_________ Common Securities having an aggregate Liquidation Amount of $_______
against payment by the Depositor of an aggregate purchase price plus accrued
distributions from April __, 1998, if any, of such Common Securities of
$_______, which amount such Administrative Trustee shall promptly deliver to the
Property Trustee. Contemporaneously therewith, an Administrative Trustee, on
behalf of the Trust, shall subscribe to and purchase from the Depositor
Debentures, registered in the name of the Trust and having an aggregate
principal amount equal to $__________, and, in satisfaction of the purchase
price plus accrued interest from April __, 1998, if any, for such Debentures,
the Property Trustee, on behalf of the Trust, shall deliver to the Depositor the
sum of $__________ (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).
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Section 2.6 Declaration of Trust.
The exclusive purposes and functions of the Trust are (a) to issue and
sell Trust Securities, (b) to use the proceeds from such sale to acquire the
Debentures and (c) to engage in those activities necessary or incidental
thereto. The Depositor hereby appoints the Trustees as trustees of the Trust, to
have all the rights, powers and duties to the extent set forth herein, and the
Trustees hereby accept such appointment. The Property Trustee hereby declares
that it will hold the Trust Property in trust upon and subject to the conditions
set forth herein for the benefit of the Trust and the Securityholders. The
Administrative Trustees shall have all rights, powers and duties set forth
herein and in accordance with applicable law with respect to accomplishing the
purposes of the Trust. 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 Administrative Trustees set
forth herein. The Delaware Trustee shall be one of the Trustees of the Trust for
the sole and limited purpose of fulfilling the requirements of Section 3807 of
the Delaware Business Trust Act.
Section 2.7 Authorization to Enter into Certain
Transactions.
(a) The Trustees shall conduct the affairs of the Trust in accordance
with the terms of this Trust Agreement. Subject to the limitations set forth in
paragraph (b) of this Section and Article VIII and in accordance with the
following provisions (i) and (ii), the Trustees shall have the authority to
enter into all transactions and agreements determined by the Trustees to be
appropriate in exercising the authority, express or implied, otherwise granted
to the Trustees under this Trust Agreement, and to perform all acts in
furtherance thereof, including without limitation, the following:
(i) As among the Trustees, each Administrative Trustee, acting
singly or collectively, shall have the power and authority to act on
behalf of the Trust with respect to the following matters:
(A) the issuance and sale of the Trust Securities;
(B) to cause the Trust to enter into, and to execute,
deliver and perform on behalf of the Trust, the Certificate
Depository Agreement and such other agreements as may be
necessary or desirable in connection with the purposes and
function of the Trust;
(C) assisting in the registration of the Capital
Securities under the Securities Act of 1933, as amended, and
under state securities or blue sky laws,
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and the qualification of this Trust Agreement as a
trust indenture under the Trust Indenture Act;
(D) assisting in the listing, if any, of the Capital
Securities upon such national securities exchange or exchanges
or automated quotation system or systems as shall be
determined by the Depositor and the registration of the
Capital Securities under the Securities Exchange Act of 1934,
as amended, and the preparation and filing of all periodic and
other reports and other documents pursuant to the foregoing;
(E) the sending of notices (other than notices of
default) and other information regarding the Trust Securities
and the Debentures to the Securityholders in accordance with
this Trust Agreement;
(F) the appointment of a Paying Agent and Securities
Registrar in accordance with this Trust Agreement;
(G) registering transfer of the Trust Securities in
accordance with this Trust Agreement;
(H) to the extent provided in this Trust Agreement,
the winding up of the affairs of and liquidation of the Trust
and the execution and filing of the certificate of
cancellation with the Secretary of State of the State of
Delaware;
(I) unless otherwise required by the Delaware
Business Trust Act or the Trust Indenture Act, to execute on
behalf of the Trust (either acting alone or together with any
or all of the Administrative Trustees) any documents that the
Administrative Trustees have the power to execute pursuant to
this Trust Agreement; and
(J) the taking of any action incidental to the
foregoing as the Trustees may from time to time determine is
necessary or advisable to give effect to the terms of this
Trust Agreement for the benefit of the Securityholders
(without consideration of the effect of any such action on any
particular Securityholder).
(ii) As among the Trustees, the Property Trustee shall have
the power, duty and authority to act on behalf of the Trust with
respect to the following matters:
(A) the establishment of the Payment Account;
(B) the receipt of the Debentures;
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(C) the collection of interest, principal and any
other payments made in respect of the Debentures in the
Payment Account;
(D) the distribution through the Paying Agent of
amounts owed to the Securityholders in respect of the Trust
Securities;
(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 Securityholders 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 Trust
and the execution and filing of the certificate of
cancellation with the Secretary of State of the State of
Delaware; and
(I) except as otherwise provided in this Section
2.7(a)(ii), the Property Trustee shall have none of the
duties, liabilities, powers or the authority of the
Administrative Trustees set forth in Section 2.7(a)(i).
(b) So long as this Trust Agreement remains in effect, the Trust (or
the Trustees acting on behalf of the Trust) shall not undertake any business,
activities or transaction except as expressly provided herein or contemplated
hereby. In particular, the Trustees shall not (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 Securityholders,
except as expressly provided herein, (iii) take any action that would cause the
Trust to fail or cease to qualify as a "grantor trust" for United States federal
income tax purposes, (iv) incur any indebtedness for borrowed money or issue any
other debt, (v) take or consent to any action that would result in the placement
of a Lien on any of the Trust Property, (vi) invest any proceeds received by the
Trust from holding the Debentures, but shall distribute all such proceeds to
Holders of Trust Securities pursuant to the terms of this Trust Agreement and of
the Trust Securities; (vii) acquire any assets other than the Trust Property,
(viii) possess any power or otherwise act in such a way as to vary the Trust
Property, (ix) possess any power or otherwise act in such a way as to vary the
terms of the Trust Securities in any way whatsoever (except to the extent
expressly authorized in this Trust Agreement or by the terms of the Trust
Securities) or
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(x) issue any securities or other evidences of beneficial ownership of, or
beneficial interest in, the Trust other than the Trust Securities. The
Administrative Trustees 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 Trust or the Securityholders in their capacity as Securityholders.
(c) In connection with the issue and sale of the Capital Securities,
the Depositor shall have the power, authority, right and responsibility to
assist the Trust with respect to, or effect on behalf of the 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 Trust with the
Commission and the execution on behalf of the Trust of one or more
registration statements on the appropriate form in relation to the
Capital Securities, including any amendments thereto;
(ii) the determination of the states 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 which must be taken by or on behalf of the Trust,
and the advice to the Trustees of actions they must take on behalf of
the Trust, and the preparation for execution and filing of any
documents to be executed and filed by the Trust or on behalf of the
Trust, as the Depositor deems necessary or advisable in order to comply
with the applicable laws of any such states;
(iii) the preparation for filing by the Trust and execution on
behalf of the Trust of an application to the New York Stock Exchange or
any other national stock exchange or the Nasdaq National Market or any
other automated quotation system for listing upon notice of issuance of
any Capital Securities and filing with such exchange or self-regulatory
organization such notifications and documents as may be necessary from
time to time to maintain such listing;
(iv) the negotiation of the terms of, and the execution and
delivery of, the Underwriting Agreement providing for the sale of the
Capital Securities; and
(v) 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 Administrative
Trustees are authorized and directed to conduct the affairs of the Trust and to
operate the Trust so that the Trust will not be deemed to be an "investment
company" required to be registered under the 1940 Act, or fail to be classified
as a grantor trust for United States federal income tax purposes and
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so that the Debentures will be treated as indebtedness of the Depositor for
United States federal income tax purposes. In this connection, the Depositor and
the Administrative Trustees are authorized to take any action, not inconsistent
with applicable law, the Certificate of Trust or this Trust Agreement, that each
of the Depositor and any Administrative Trustee determines in its 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
Capital Securities.
Section 2.8 Assets of Trust.
The assets of the Trust shall consist solely 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 for the benefit of the Trust and the Securityholders 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 any agent of the
Property Trustee 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 Securityholders 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 or premium on, and any
other payments or proceeds with respect to, the Debentures. Amounts held in the
Payment Account shall not be invested by the Property Trustee.
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ARTICLE IV
Distributions; Redemption
Section 4.1 Distributions.
(a) The Trust Securities represent undivided beneficial ownership
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 of Additional Interest, as defined in the
Indenture) are made on the Debentures. Accordingly:
(i) Distributions on the Trust Securities shall be cumulative,
and will accumulate whether or not there are funds of the Trust
available for the payment of Distributions. Distributions shall accrue
from April __, 1998, and, except in the event (and to the extent) that
the Depositor exercises its right to defer the payment of interest on
the Debentures pursuant to the Indenture, shall be payable quarterly in
arrears on March 31, June 30, September 30 and December 31 of each
year, commencing on June 30, 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 (without any additional
Distributions or other payment in respect of 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 each case with the same force and effect as if made on
such date (each date on which Distributions are payable in accordance
with this Section 4.1(a), a "Distribution Date").
(ii) Assuming payments of interest on the Debentures are made
when due (and before giving effect to Additional Amounts, if
applicable), Distributions on the Trust Securities shall be payable at
a rate of _____% per annum of the Liquidation Amount of the Trust
Securities, the rate per annum provided for in the Debentures. The
amount of Distributions payable for any period shall be computed on the
basis of a 360-day year of twelve 30-day months. The amount of
Distributions payable for any period shall include the Additional
Amounts, if any.
(iii) 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 extent that the 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
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appear on the Securities Register for the Trust Securities on the relevant
record date, which shall be one Business Day prior to such Distribution Date;
provided, however, that in the event that the Capital Securities do not remain
in book-entry-only form, the relevant record date shall be the 15th day of the
month in which the relevant Distribution Date occurs without giving effect to
the third sentence of Section 4.1(a)(i) (whether or not such record date is a
Business Day).
Section 4.2 Redemption.
(a) On each Debenture Redemption Date and on the Debenture Maturity
Date, the 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;
(iii) the CUSIP number;
(iv) if less than all the Outstanding Trust Securities are to
be redeemed, the identification and the total 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 accrue on and after said date;
and
(vi) if the Capital Securities are no longer in
book-entry-only form, the place and address where the Holders shall
surrender their Capital Securities Certificates.
(c) The Trust Securities redeemed on each Redemption Date shall be
redeemed at the Redemption Price with the proceeds from the contemporaneous
redemption or payment at Debenture Maturity Date. 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 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, so long
as the Capital Securities are in
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book-entry-only form, irrevocably deposit with the Clearing Agency for the
Capital Securities 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 thereof. If the Capital Securities are no longer
in book-entry-only form, the Property Trustee, subject to Section 4.2(c), will
irrevocably deposit with the Paying Agent funds sufficient to pay the applicable
Redemption Price and will give the Paying Agent irrevocable instructions and
authority to pay the Redemption Price to the Holders thereof upon surrender of
their 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 for the Trust 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 Securityholders holding Trust Securities so
called for redemption will cease, except the right of such Securityholders to
receive the Redemption Price and any Distribution payable on or prior to the
Redemption Date, but without interest thereon, and such Trust 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 (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 any Trust Securities called for redemption is
improperly withheld or refused and not paid either by the Trust or by the
Depositor pursuant to the Guarantee, Distributions on such Trust Securities will
continue to accrue, at the then applicable rate, from the Redemption Date
originally established by the Trust for such Trust 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.
(e) Payment of the Redemption Price on the Trust Securities shall be
made to the recordholders thereof as they appear on the Securities Register for
the Trust Securities on the relevant record date, which shall be one Business
Day prior to the relevant Redemption Date; provided, however, that in the event
that the Capital Securities do not remain in book-entry-only form, the relevant
record date shall be the date fifteen days prior to the relevant Redemption
Date.
(f) 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 on a
pro rata basis (based on
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Liquidation Amounts) among the Common Securities and the Capital Securities. The
particular Capital Securities to be redeemed shall be selected on a pro rata
basis (based upon 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, by such method (including, without
limitation, by lot) as the Property Trustee shall deem fair and appropriate and
which may provide for the selection for redemption of portions (equal to $25 or
an integral multiple of $25 in excess thereof) of the Liquidation Amount of
Capital Securities of a denomination larger than $25. The Property Trustee shall
promptly notify the Security 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 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 Additional Amounts, if
applicable) on, and the Redemption Price of, the Trust Securities, as
applicable, shall be made, subject to Section 4.2(f), 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 or
Redemption Date any Event of Default resulting from a Debenture Event of Default
shall have occurred and be continuing, no payment of any Distribution (including
Additional Amounts, if applicable) on, or Redemption Price 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 Additional Amounts,
if applicable) 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, 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
Additional Amounts, if applicable) on, or the Redemption Price of, Capital
Securities then due and payable.
(b) In the case of the occurrence of any Event of Default resulting
from any Debenture Event of Default, the Holder of Common Securities will be
deemed to have waived any 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 any such Event of Default under this
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Trust Agreement with respect to the Capital Securities has been so cured, waived
or otherwise eliminated, the Property Trustee shall act solely on behalf of the
Holders of the Capital Securities and not the Holder of the Common Securities,
and only the Holders of 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 Additional Amounts, if applicable)
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, which shall credit the relevant Persons' accounts at such Clearing Agency
on the applicable Distribution Dates. Payments in respect of the Common
Securities shall be made in such manner as shall be mutually agreed in writing
between the Property Trustee and the Common Securityholder.
Section 4.5 Tax Returns and Reports.
The Administrative Trustees 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
Trust. In this regard, the Administrative Trustees shall (a) prepare and file
(or cause to be prepared and filed) the appropriate Internal Revenue Service
Form required to be filed in respect of the Trust in each taxable year of the
Trust and (b) prepare and furnish (or cause to be prepared and furnished) to
each Securityholder the appropriate Internal Revenue Service form and the
information required to be provided on such form. The Administrative Trustees
shall provide the Depositor and the Property Trustee with a copy of all such
returns and reports promptly after such filing or furnishing. The Trustees shall
comply with United States federal withholding and backup withholding tax laws
and information reporting requirements with respect to any payments to
Securityholders under the Trust Securities.
Section 4.6 Payment of Expenses of the Trust.
Pursuant to Section 10.6 of the Indenture, the Depositor, as borrower,
has agreed to pay to the Trust, and reimburse the Trust for, the full amount of
any costs, expenses or liabilities of the Trust (other than obligations of the
Trust to pay the Holders of any Capital Securities or other similar interests in
the Trust the amounts due such Holders pursuant to the terms of the Capital
Securities or such other similar interests, as the case may be), including,
without limitation, any taxes, duties or other governmental charges of whatever
nature (other than withholding taxes) imposed on the Trust by the United States
or any other taxing authority. Such payment obligation includes any such
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costs, expenses or liabilities of the Trust that are required by applicable law
to be satisfied in connection with a termination of the Trust.
Section 4.7 Payments under Indenture or Pursuant to Direct
Actions.
Any amount payable hereunder to any Holder of Capital Securities shall
be reduced by the amount of any corresponding payment such Holder (or an Owner
with respect to the Holder's Capital Securities) has directly received pursuant
to Section 5.8 of the Indenture or Section 5.14 of this Trust Agreement.
ARTICLE V
Trust Securities Certificates
Section 5.1 Initial Ownership.
Upon the creation of the Trust and the contribution by the Depositor
pursuant to 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 Trust.
Section 5.2 The Trust Securities Certificates.
The Capital Securities Certificates shall be issued in minimum
denominations of $25 Liquidation Amount and integral multiples of $25 in excess
thereof, and the Common Securities Certificates shall be issued in denominations
of $25 Liquidation Amount and integral multiples thereof. The Trust Securities
Certificates shall be executed on behalf of the Trust by manual or facsimile
signature of at least one Administrative Trustee and, if executed on behalf of
the Trust by facsimile, countersigned by a transfer agent or its agent. The
Capital Securities Certificates shall be authenticated by the Property Trustee
by manual signature of an authorized signatory thereof. Trust 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 Trust or the Property Trustee or, if executed on behalf of the Trust by
facsimile, countersigned by a transfer agent or its agent, 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 Trust Securities Certificates or did not hold such
offices at the date of delivery of such Trust Securities Certificates. A
transferee of a Trust Securities Certificate shall become a Securityholder, and
shall be entitled to the rights and subject to the obligations of a
Securityholder hereunder, upon due registration of such Trust Securities
Certificate in such transferee's name pursuant to Sections 5.4, 5.11 and 5.13.
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Section 5.3 Execution and Delivery of Trust Securities
Certificates.
On the Closing Date, the Administrative Trustees shall cause Trust
Securities Certificates, in an aggregate Liquidation Amount as provided in
Sections 2.4 and 2.5, to be executed on behalf of the Trust and delivered to or
upon the written order of the Depositor, signed by its chairman of the board,
its president, any executive vice president, or any vice president, treasurer or
assistant treasurer or controller without further corporate action by the
Depositor, in authorized denominations.
Section 5.4 Registration of Transfer and Exchange of
Capital Securities Certificates.
The Depositor shall keep or cause to be kept, at the office or agency
maintained pursuant to Section 5.8, a register or registers for the purpose of
registering Trust Securities Certificates and transfers and exchanges of Capital
Securities Certificates (the "Securities Register") in which the transfer agent
and registrar designated by the Depositor (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 5.10 in the case of the Common Securities
Certificates) and registration of transfers and exchanges of Capital Securities
Certificates as herein provided. The Bank shall be the initial Securities
Registrar.
Upon surrender for registration of transfer of any Capital Securities
Certificate at the office or agency maintained pursuant to Section 5.8, the
Administrative Trustees or any one of them shall execute on behalf of the Trust
(and if executed on behalf of the Trust by a facsimile signature, such
certificate shall be countersigned by a transfer agent or its agent) and
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 dated the date of execution by such Administrative
Trustee or Trustees. The Securities Registrar shall not be required to register
the transfer of any Capital Securities that have been called for redemption
during a period beginning at the opening of business 15 days before the day of
selection for such redemption.
At the option of a Holder, Capital Securities Certificates may be
exchanged for other Capital Securities Certificates in authorized denominations
of the same class and of a like aggregate Liquidation Amount upon surrender of
the Capital Securities Certificates to be exchanged at the office or agency
maintained pursuant to Section 5.8.
Every Capital Securities Certificate presented or surrendered for
registration of transfer or exchange shall be accompanied by a written
instrument of transfer in form
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satisfactory to an Administrative Trustee and the Securities Registrar duly
executed by the Holder or his attorney duly authorized in writing. Each Capital
Securities Certificate surrendered for registration of transfer or exchange
shall be cancelled and subsequently disposed of by an Administrative Trustee or
the Securities Registrar 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 Securities Registrar 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.
Section 5.5 Mutilated, Destroyed, Lost or Stolen Trust
Securities Certificates.
If (a) any mutilated Trust 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 Trust
Securities Certificate and (b) there shall be delivered to the Securities
Registrar and the Administrative Trustees such security or indemnity as may be
required by them to save each of them harmless, then in the absence of notice
that such Trust Securities Certificate shall have been acquired by a bona fide
purchaser, the Administrative Trustees, or any one of them, on behalf of the
Trust shall execute by manual or facsimile signature and, if executed on behalf
of the Trust by facsimile signature, such certificate shall be countersigned by
a transfer agent, and make available for delivery, in exchange for or in lieu of
any such mutilated, destroyed, lost or stolen Trust Securities Certificate, a
new Trust Securities Certificate of like class, tenor and denomination. In
connection with the issuance of any new Trust Securities Certificate under this
Section, the Administrative Trustees 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 Trust Securities
Certificate issued pursuant to this Section shall constitute conclusive evidence
of an undivided beneficial interest in the Trust Property, as if originally
issued, whether or not the lost, stolen or destroyed Trust Securities
Certificate shall be found at any time.
Section 5.6 Persons Deemed Securityholders.
The Trustees or the Securities Registrar shall treat the Person in
whose name any Trust Securities Certificate shall be registered in the
Securities Register as the owner of such Trust Securities Certificate for the
purpose of receiving Distributions and for all other purposes whatsoever, and
neither the Trustees nor the Securities Registrar shall be bound by any notice
to the contrary.
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Section 5.7 Access to List of Securityholders' Names and
Addresses.
Each Holder and each Owner shall be deemed to have agreed not to hold
the Depositor, the Property Trustee or the Administrative Trustees accountable
by reason of the disclosure of its name and address, regardless of the source
from which such information was derived.
Section 5.8 Maintenance of Office or Agency.
The Administrative Trustees shall maintain 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 Trustees in respect of the Trust Securities Certificates may be served. The
Administrative Trustees initially designate The Bank of New York, 101 Barclay
Street, Floor 21 West, New York, New York 10286, Attn: Corporate Trust, Trustee
Administration, as its principal corporate trust office for such purposes. The
Administrative Trustees shall give prompt written notice to the Depositor, the
Property Trustee and to the Securityholders of any change in the location of the
Securities Register or any such office or agency.
Section 5.9 Appointment of Paying Agent.
The Paying Agent shall make Distributions to Securityholders from the
Payment Account and shall report the amounts of such Distributions to the
Property Trustee and the Administrative Trustees. Any Paying Agent shall have
the revocable power to withdraw funds from the Payment Account for the purpose
of making the Distributions referred to above. The Administrative Trustees may
revoke such power and remove the Paying Agent if such Trustees determine in
their sole discretion that the Paying Agent shall have failed to perform its
obligations under this Trust Agreement in any material respect. The Paying Agent
shall initially be the Bank, and any co-paying agent chosen by the Bank, and
acceptable to the Administrative Trustees and the Depositor. Any Person acting
as Paying Agent shall be permitted to resign as Paying Agent upon 30 days'
written notice to the Administrative Trustees, the Property Trustee and the
Depositor. In the event that the Bank shall no longer be the Paying Agent or a
successor Paying Agent shall resign or its authority to act be revoked, the
Administrative Trustees shall appoint a successor that is acceptable to the
Property Trustee and the Depositor to act as Paying Agent (which shall be a bank
or trust company). The Administrative Trustees shall cause such successor Paying
Agent or any additional Paying Agent appointed by the Administrative Trustees to
execute and deliver to the Trustees an instrument in which such successor Paying
Agent or additional Paying Agent shall agree with the 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 Securityholders in
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trust for the benefit of the Securityholders entitled thereto until such sums
shall be paid to such Securityholders. The Paying Agent shall return all
unclaimed funds to the Property Trustee and upon resignation or 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, and any Paying Agent shall be bound by the
requirements with respect to paying agents of securities issued pursuant to the
Trust Indenture Act. Any reference in this Agreement to the Paying Agent shall
include any co-paying agent unless the context requires otherwise.
Section 5.10 Ownership of Common Securities by Depositor.
On the Closing Date, the Depositor shall acquire and retain beneficial
and record ownership of the Common Securities. To the fullest extent permitted
by law, other than a transfer in connection with a consolidation or merger of
the Depositor into another Person, 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, any attempted transfer of the
Common Securities shall be void. The Administrative Trustees shall cause each
Common Securities Certificate issued to the Depositor to contain a legend
stating "THIS CERTIFICATE IS NOT TRANSFERABLE TO ANY PERSON".
Section 5.11 Book-Entry Capital Securities Certificates;
Common Securities Certificate.
(a) The Capital Securities Certificates, upon original issuance, will
be issued in the form of a typewritten Capital Securities Certificate or
Certificates representing Book-Entry Capital Securities Certificates, to be
delivered to The Depository Trust Company, the initial Clearing Agency, by, or
on behalf of, the Trust. Such Capital Securities Certificate or Certificates
shall initially be registered on the Securities Register in the name of Cede &
Co., the nominee of the initial Clearing Agency, and no Owner will receive a
Definitive Capital Securities Certificate representing such Owner's interest in
such Capital Securities, except as provided in Section 5.13. Unless and until
Definitive Capital Securities Certificates have been issued to Owners pursuant
to Section 5.13:
(i) the provisions of this Section 5.11(a) shall be in
full force and effect;
(ii) the Securities Registrar and the Trustees shall be
entitled to deal with the Clearing Agency for all purposes of this
Trust Agreement relating to the Book-Entry Capital Securities
Certificates (including the payment of the Liquidation Amount of and
Distributions on the Capital
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Securities evidenced by Book-Entry Capital Securities Certificates and
the giving of instructions or directions to Owners of Capital
Securities evidenced by Book-Entry Capital Securities Certificates) as
the sole Holder of Capital Securities evidenced by Book-Entry Capital
Securities Certificates and shall have no obligations to the Owners
thereof;
(iii) to the extent that the provisions of this Section 5.11
conflict with any other provisions of this Trust Agreement, the
provisions of this Section 5.11 shall control; and
(iv) the rights of the Owners of the Book-Entry Capital
Securities Certificates shall be exercised only through the Clearing
Agency and shall be limited to those established by law and agreements
between such Owners and the Clearing Agency and/or the Clearing Agency
Participants. Pursuant to the Certificate Depository Agreement, unless
and until Definitive Capital Securities Certificates are issued
pursuant to Section 5.13, 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.
(b) 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 5.12 Notices to Clearing Agency.
To the extent that a notice or other communication to the Owners is
required under this Trust Agreement, unless and until Definitive Capital
Securities Certificates shall have been issued to Owners pursuant to Section
5.13, the Trustees shall give all such notices and communications specified
herein to be given to Owners to the Clearing Agency, and shall have no
obligations to the Owners.
Section 5.13 Definitive Capital Securities Certificates.
If (a) the Depositor advises the Trustees in writing that the Clearing
Agency is no longer willing or able to properly discharge its responsibilities
with respect to the Capital Securities Certificates, and the Depositor is unable
to locate a qualified successor, (b) the Depositor at its option advises the
Trustees in writing that it elects to terminate the book-entry system through
the Clearing Agency or (c) after the occurrence of a Debenture Event of Default,
Owners of Capital Securities Certificates representing beneficial interests
aggregating at least a majority of the Liquidation Amount advise the
Administrative Trustees in writing that the continuation of a book-entry system
through the Clearing Agency is no longer in the best interest of the Owners of
Capital Securities Certificates,
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then the Administrative Trustees shall notify the other Trustees and the
Clearing Agency, and the Clearing Agency, in accordance with its customary rules
and procedures, shall notify all Clearing Agency Participants for whom it holds
Capital Securities of the occurrence of any such event and of the availability
of the Definitive Capital Securities Certificates to Owners of such class or
classes, as applicable, requesting the same. Upon surrender to the
Administrative Trustees of the typewritten Capital Securities Certificate or
Certificates representing the Book-Entry Capital Securities Certificates by the
Clearing Agency, accompanied by registration instructions, the Administrative
Trustees, or any one of them, shall execute the Definitive Capital Securities
Certificates in accordance with the instructions of the Clearing Agency or, if
executed on behalf of the Trust by facsimile, countersigned by a transfer agent
or its agent. Neither the Securities Registrar nor the Trustees shall be liable
for any delay in delivery of such instructions and may conclusively rely on, and
shall be protected in relying on, such instructions. Upon the issuance of
Definitive Capital Securities Certificates, the Trustees shall recognize the
Holders of the Definitive Capital Securities Certificates as Securityholders.
The Definitive Capital Securities Certificates shall be typewritten, printed,
lithographed or engraved or may be produced in any other manner as is reasonably
acceptable to the Administrative Trustees that meets the requirements of any
stock exchange or automated quotation system on which the Capital Securities are
then listed or approved for trading, as evidenced by the execution thereof by
the Administrative Trustees or any one of them.
Section 5.14 Rights of Securityholders.
(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 Securityholders shall not have any right or title therein other than the
undivided beneficial ownership interest in the assets of the 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 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
Securityholders against payment of the purchase price therefor will be fully
paid and nonassessable by the Trust. The Holders of the Capital 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.
(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
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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 such
right by a notice in writing to the Property Trustee, Depositor and the
Debenture Trustee; and upon any such declaration such principal amount of and
the accrued interest on all of the Debentures shall become immediately due and
payable as set forth in the Indenture, provided that the payment of principal
and interest on such Debentures shall remain subordinated to the extent provided
in the Indenture.
At any time after such 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 described in the
Indenture provided, the Holders of 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 (including
any Additional Interest (as defined in the Indenture)) on all
of the Debentures,
(B) the principal of any Debentures which have become
due otherwise than by such declaration of acceleration and
interest thereon at the rate borne by the Debentures, and
(C) 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 which has
become due solely by such acceleration, have been cured or waived as
provided in Section 5.13 of the Indenture.
The Holders of a majority in aggregate Liquidation Amount of the
Capital Securities may, on behalf of the Holders of all the Capital Securities,
waive any past default under the Indenture, except a default in the payment of
principal or interest (unless all Events of Default with respect to the
Debentures, other than the non-payment of the principal of the Debentures which
has become due solely by such acceleration, have been cured or annulled as
provided in Section 5.3 of the Indenture and the Depositor has paid or deposited
with the Debenture Trustee a sum
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sufficient to pay all overdue installments of interest (including any Additional
Interest (as defined in the Indenture)) on the Debentures, the principal of any
Debentures which have become due otherwise than by such declaration of
acceleration and interest thereon at the rate borne by the Debentures, and 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) 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 Debenture. No
such rescission shall affect any subsequent default or impair any right
consequent thereon.
Upon receipt by the Property Trustee of written notice declaring such
an acceleration, or rescission and annulment thereof, by Holders of the Capital
Securities all or part of which is represented by Book-Entry Capital Securities
Certificates, 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 of Outstanding Capital Securities 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
which 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 which 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 5.14(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 the
principal amount of or interest on Debentures having a principal amount equal to
the Liquidation Amount of the Capital Securities of such Holder (a "Direct
Action"). Except as set forth in Section 5.14(b) and this Section 5.14(c), the
Holders of Capital Securities shall have no right to
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exercise directly any right or remedy available to the holders of, or in respect
of, the Debentures.
Section 5.15 CUSIP Numbers.
The Administrative Trustees in issuing the Capital Securities may use
"CUSIP" numbers (if then generally in use), and, if so, the Property Trustee
shall use "CUSIP" numbers in notices of redemption as a convenience to Holders;
provided that any such notice may state that no representation is made as to the
correctness of such numbers either as printed on the Capital Securities or as
contained in any notice of a redemption and that reliance may be placed only on
the other identification numbers printed on the Capital Securities, and any such
redemption shall not be affected by any defect in or omission of such numbers.
The Administrative Trustees will promptly notify the Property Trustee of any
change in the CUSIP numbers.
ARTICLE VI
Acts of Securityholders; Meetings; Voting
Section 6.1 Limitations on Voting Rights.
(a) Except as provided in this Section, in Sections 5.14, 8.10 and 10.3
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 Trust or the obligations of the
parties hereto, nor shall anything herein set forth, or contained in the terms
of the Trust Securities Certificates, be construed so as to constitute the
Securityholders from time to time as partners or members of an association.
(b) So long as any Debentures are held by the Property Trustee, the
Trustees shall not (i) direct the time, method and place of conducting any
proceeding for any remedy available to the Debenture Trustee, or executing any
trust or power conferred on the Debenture Trustee with respect to such
Debentures, (ii) waive any past default which is waivable 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 all
Outstanding 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 Trustees shall
not revoke any action previously authorized or approved by a vote of the Holders
of Capital Securities, except by a subsequent vote of the Holders of Capital
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Securities. The Property Trustee shall notify all Holders of the Capital
Securities of any notice of default received from the Debenture Trustee 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 Administrative 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 Trust to fail to be classified as a grantor trust for
United States federal income tax purposes.
(c) If any proposed amendment to the Trust Agreement provides for, or
the 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 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 Outstanding 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 Trust to fail to be
classified as a grantor trust for United States federal income tax purposes.
Section 6.2 Notice of Meetings.
Notice of all meetings of the Capital Securityholders, stating the
time, place and purpose of the meeting, shall be given by the Property Trustee
pursuant to Section 10.9 to each Capital Securityholder of record, at his
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 Capital Securityholders.
No annual meeting of Securityholders is required to be held. The
Administrative Trustees, however, shall call a meeting of Capital
Securityholders to vote on any matter upon the written request of the Capital
Securityholders of record of 25% of the Outstanding Capital Securities (based
upon their Liquidation Amount) and the Administrative Trustees or the Property
Trustee may, at any time in their discretion, call a meeting of Capital
Securityholders to vote on any matters as to which Capital Securityholders are
entitled to vote.
Capital Securityholders of record of 50% of the Outstanding Capital
Securities (based upon their Liquidation Amount), present
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in person or by proxy, shall constitute a quorum at any meeting of Capital
Securityholders.
If a quorum is present at a meeting, an affirmative vote by the Capital
Securityholders of record present, in person or by proxy, holding more than a
majority of the Outstanding Capital Securities (based upon their Liquidation
Amount) held by holders of record of Outstanding Capital Securities present,
either in person or by proxy, at such meeting shall constitute the action of the
Capital Securityholders, unless this Trust Agreement requires a greater number
of affirmative votes.
Section 6.4 Voting Rights.
Securityholders shall be entitled to one vote for each $25 of
Liquidation Amount represented by their Trust Securities in respect of any
matter as to which such Securityholders are entitled to vote.
Section 6.5 Proxies, etc.
At any meeting of Securityholders, any Securityholder 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 Administrative Trustees, or
with such other officer or agent of the Trust as the Administrative Trustees 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 or one or more officers of the Property
Trustee. Only Securityholders 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 Securityholder 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 Securityholder Action by Written Consent.
Any action which may be taken by Securityholders at a meeting may be
taken without a meeting if Securityholders holding a majority of all Outstanding
Trust Securities (based upon their Liquidation Amount) entitled to vote in
respect of such action (or such larger proportion thereof as shall be required
by any express provision of this Trust Agreement) shall consent to the action in
writing.
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Section 6.7 Record Date for Voting and Other Purposes.
For the purposes of determining the Securityholders 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 Administrative Trustees may from time to time fix a date, not
more than 90 days prior to the date of any meeting of Securityholders 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 Securityholders of record for such
purposes.
Section 6.8 Acts of Securityholders.
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 Securityholders or Owners may be embodied in and evidenced by one or
more instruments of substantially similar tenor signed by such Securityholders
or Owners 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 an Administrative Trustee. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Securityholders or
Owners 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 Trustees, if made in the manner provided in this Section.
The fact and date of the execution by any Person of any such instrument
or writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged to him the execution thereof. Where such execution is by
a signer acting in a capacity other than his individual capacity, such
certificate or affidavit shall also constitute sufficient proof of his
authority. The fact and date of the execution of any such instrument or writing,
or the authority of the Person executing the same, may also be proved in any
other manner which any Trustee receiving the same deems sufficient.
The ownership of Capital Securities shall be proved by the Securities
Register.
Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the Securityholder of any Trust Security shall bind every future
Securityholder of the same Trust Security and the Securityholder of every Trust
Security issued
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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
Trustees or the Trust in reliance thereon, whether or not notation of such
action is made upon such Trust Security.
Without limiting the foregoing, a Securityholder 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 between the Securityholders and the
Administrative Trustees or among such Securityholders or Trustees with respect
to the authenticity, validity or binding nature of any request, demand,
authorization, direction, consent, waiver or other Act of such Securityholder or
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 notice to the Administrative Trustees and the Property
Trustee, the records of the Trust shall be open to inspection by Securityholders
during normal business hours for any purpose reasonably related to such
Securityholder's interest as a Securityholder.
ARTICLE VII
Representations and Warranties
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 Securityholders 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;
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(c) the Delaware Trustee is a Delaware banking corporation duly
organized, validly existing and in good standing in the State of Delaware;
(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 State of New York 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;
(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 or therein 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 New York or Delaware law 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
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or the Delaware Trustee in any court or before any governmental authority,
agency or arbitration board or tribunal which, individually or in the aggregate,
would materially and adversely affect the 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
Securityholders that:
(a) the Trust Securities Certificates issued at the Closing Date on
behalf of the Trust have been duly authorized and will have been, duly and
validly executed, issued and delivered by the Trustees pursuant to the terms and
provisions of, and in accordance with the requirements of, this Trust Agreement
and the Securityholders will be, as of such date, entitled to the benefits of
this Trust Agreement; and
(b) there are no taxes, fees or other governmental charges payable by
the Trust (or the Trustees on behalf of the Trust) under the laws of the State
of Delaware or any political subdivision thereof in connection with the
execution, delivery and performance by the Property Trustee or the Delaware
Trustee, as the case may be, of this Trust Agreement.
ARTICLE VIII
The Trustees
Section 8.1 Certain Duties and Responsibilities.
(a) The duties and responsibilities of the Trustees shall be as
provided by this Trust Agreement and, in the case of the Property Trustee, by
the Trust Indenture Act. Notwithstanding the foregoing, no provision of this
Trust Agreement shall require the Trustees to expend or risk their own funds or
otherwise incur any financial liability in the performance of any of their
duties hereunder, or in the exercise of any of their rights or powers, if 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
them. 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 Trustees shall be subject to the provisions of this
Section. Nothing in this Trust Agreement shall be construed to release an
Administrative Trustee from liability for its own gross negligent action, its
own gross negligent failure to act, or its own willful misconduct. To the extent
that, at law or in equity, an Administrative Trustee has duties (including
fiduciary duties) and liabilities relating thereto to the Trust or to the
Securityholders, such Administrative Trustee
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shall not be liable to the Trust or to any Securityholder for such Trustee'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 Administrative Trustees otherwise existing at law or in
equity, are agreed by the Depositor and the Securityholders to replace such
other duties and liabilities of the Administrative Trustees.
(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
Securityholder, 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 the Trustees are
not 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 Trustees expressly set forth
elsewhere in this Trust Agreement or, in the case of the Property Trustee, in
the Trust Indenture Act.
(c) No provision of this Trust Agreement shall be construed to relieve
the Property Trustee from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that:
(i) 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;
(ii) 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 not less than a
majority in Liquidation Amount of the Trust 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;
(iii) 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;
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(iv) the Property Trustee shall not be liable for any interest
on any money received by it except as it may otherwise agree in writing
with the Depositor; and money held by the 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; and
(v) the Property Trustee shall not be responsible for
monitoring the compliance by the Administrative Trustees or the
Depositor with their respective duties under this Trust Agreement, nor
shall the Property Trustee be liable for the default or misconduct of
the Administrative Trustees or the Depositor.
Section 8.2 Certain Notices.
Within ten Business Days after the occurrence of any Event of Default
actually known to the Property Trustee, the Property Trustee shall transmit, in
the manner and to the extent provided in Section 10.9, notice of such Event of
Default to the Securityholders, the Administrative Trustees and the Depositor,
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 Administrative Trustee shall transmit,
in the manner and to the extent provided in Section 10.9, notice of such
exercise to the Securityholders and the Property Trustee, unless such exercise
shall have been revoked.
Section 8.3 Certain Rights of Property Trustee.
Subject to the provisions of Section 8.1:
(a) the Property Trustee may rely and shall be 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 or
(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,
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except as to any matter as to which the Capital Securityholders are entitled to
vote under the terms of this Trust Agreement, the Property Trustee shall deliver
a notice to the Depositor requesting written instructions of the Depositor 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 be
instructed in writing to take, or to refrain from taking, by the Depositor;
provided, however, that if the Property Trustee does not receive such
instructions of the Depositor within ten Business Days after it has delivered
such notice, or such reasonably shorter period of time set forth in such notice
(which to the extent practicable shall not be less than two Business Days), it
may, but shall be under no duty to, take or refrain from taking such action not
inconsistent with this Trust Agreement as it shall deem advisable and in the
best interests of the Securityholders, in which event the Property Trustee shall
have no liability except for its own bad faith, negligence or willful
misconduct;
(c) any direction or act of the Depositor or the Administrative
Trustees contemplated by this Trust Agreement shall be sufficiently evidenced by
an Officers' Certificate;
(d) whenever in the administration of this Trust Agreement, the
Property Trustee shall deem it desirable that a matter be established before
undertaking, suffering or omitting any action hereunder, the Property Trustee
(unless other evidence is herein specifically prescribed) may, in the absence of
bad faith on its part, request and rely upon an Officers' Certificate which,
upon receipt of such request, shall be promptly delivered by the Depositor or
the Administrative Trustees;
(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 reregistration thereof;
(f) the Property Trustee may consult with counsel of its selection
(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, such counsel may be counsel to the Depositor or any
of its Affiliates, and may include any of its employees; the Property Trustee
shall have the right at any time to seek instructions concerning the
administration of this 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 Securityholders pursuant to this Trust Agreement, unless
such
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Securityholders shall have offered to the Property Trustee reasonable security
or indemnity against the costs, expenses and liabilities which might be incurred
by it in compliance with such request or direction;
(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 Securityholders, 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 or attorneys, provided that the Property Trustee shall be responsible for
its own negligence or recklessness with respect to selection of any agent or
attorney appointed by it hereunder;
(j) whenever in the administration of this Trust Agreement the Property
Trustee shall deem it desirable to receive written instructions with respect to
enforcing any remedy or right or taking any other action hereunder the Property
Trustee (i) may request written instructions from the Holders of the Trust
Securities which written 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 written instructions are
received, and (iii) shall be protected in acting in accordance with such written
instructions; and
(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.
No provision of this Trust Agreement shall be deemed to impose any duty
or obligation on the Property Trustee to perform any act or acts or exercise any
right, power, duty or obligation conferred or imposed on it, in any jurisdiction
in which it shall be illegal, or in which the Property Trustee shall be
unqualified or incompetent in accordance with applicable law, to perform any
such act or acts, or to exercise any such right, power, duty or obligation. No
permissive power or authority available to the Property Trustee shall be
construed to be a duty.
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Section 8.4 Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Trust Securities Certificates
shall be taken as the statements of the Trust, and the Trustees do not assume
any responsibility for their correctness. The Trustees shall not be accountable
for the use or application by the Depositor of the proceeds of the Debentures.
Section 8.5 May Hold Securities.
Any Trustee or any other agent of any Trustee or the 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, except as provided in the
definition of the term "Outstanding" in Article I, may otherwise deal with the
Trust with the same rights it would have if it were not a Trustee or such other
agent.
Section 8.6 Compensation; Indemnity; Fees.
Pursuant to Section 10.6 of the Indenture, the Depositor, as borrower,
agrees:
(a) to pay to the Trustees from time to time such compensation as shall
be agreed in writing with the Depositor for all services rendered by them
hereunder (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
Trustees upon request for all reasonable expenses, disbursements and advances
incurred or made by the Trustees in accordance with any provision of this Trust
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 the fullest extent permitted by applicable law, to indemnify and
hold harmless (i) each Trustee, (ii) any Affiliate of any Trustee, (iii) any
officer, director, shareholder, employee, representative or agent of any
Trustee, and (iv) any employee or agent of the Trust or its Affiliates,
(referred to herein as an "Indemnified Person") from and against any and all
loss, damage, liability, tax, 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 Trust or any act or omission performed or
omitted by such Indemnified Person in good faith on behalf of the Trust and in a
manner such Indemnified Person reasonably believed to be within the scope of
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
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by such Indemnified Person by reason of negligence or willful misconduct with
respect to such acts or omissions. When the Property Trustee incurs expenses or
renders services in connection with an Event of Default specified in Section
5.1(4) or Section 5.1(5) of the Indenture, the expenses (including the
reasonable charges and expenses of its counsel) and the compensation for the
services are intended to constitute expenses of administration under any
applicable federal or state bankruptcy, insolvency or other similar law.
The provisions of this Section 8.6 shall survive the termination of
this Trust Agreement.
No Trustee may claim any lien or charge on any Trust Property as a
result of any amount due pursuant to this Section 8.6.
The Depositor and any Trustee (in the case of the Property Trustee,
subject to Section 8.8 hereof) 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 Trust, and the 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 Trust, shall not be deemed wrongful or improper. Neither the
Depositor, nor any Trustee, shall be obligated to present any particular
investment or other opportunity to the Trust even if such opportunity is of a
character that, if presented to the Trust, could be taken by the Trust, and the
Depositor or any Trustee shall have the right to take for its own account
(individually or as a partner or fiduciary) or to recommend to others any such
particular investment or other opportunity. Any Trustee 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.
Section 8.7 Corporate Property Trustee Required; Eligibility of
Trustees.
(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
eligible pursuant to the Trust Indenture Act to act as such and has 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, 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
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the Trust Securities shall cease to be eligible in accordance with the
provisions of this Section, it shall resign immediately in the manner and with
the effect hereinafter specified in this Article.
(b) There shall at all times be one or more Administrative Trustees
hereunder with respect to the Trust Securities. Each Administrative Trustee
shall be either a natural person who is at least 21 years of age or a legal
entity that shall act through one or more 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 that shall act
through one or more persons authorized to bind such entity.
Section 8.8 Conflicting Interests.
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.
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 Depositor and the Administrative
Trustees, by agreed action of the majority of such Trustees, shall have power to
appoint, and upon the written request of the Administrative Trustees, the
Depositor shall for such purpose join with the Administrative Trustees 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. If the Depositor
does not join in such appointment within 15 days after the receipt by it of a
request so to do, or in case a Debenture Event of Default has occurred and is
continuing, the Property Trustee alone shall have power to make such
appointment. Any co-trustee or separate trustee appointed pursuant to this
Section shall either be (i) a
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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 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 and delivered 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 Trustees specified hereunder shall be exercised
solely by such Trustees 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, 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
resigned or removed may be appointed in the manner provided in this Section.
(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.
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(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.
Section 8.10 Resignation and Removal; Appointment of Successor.
No resignation or removal of any Trustee (the "Relevant Trustee") and
no appointment of a successor Trustee pursuant to this Article shall become
effective until the acceptance of appointment by the successor 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 Securityholders.
If the instrument of acceptance by the successor Trustee required by Section
8.11 shall not have been delivered to the Relevant Trustee within 30 days after
the giving of such notice of resignation, the Relevant Trustee may petition, at
the expense of the Trust, any court of competent jurisdiction for the
appointment of a successor Relevant Trustee.
Unless a Debenture Event of Default shall have occurred and be
continuing, any Trustee may be removed at any time by Act of the Common
Securityholder. If a Debenture Event of Default shall have occurred and be
continuing, the Property Trustee or the Delaware Trustee, or both of them, may
be removed at such time by Act of the Holders of a majority in Liquidation
Amount of the Capital Securities, delivered to the Relevant Trustee (in its
individual capacity and on behalf of the Trust). An Administrative Trustee may
be removed by the Common Securityholder at any time. If the instrument of
acceptance by the successor Trustee required by Section 8.11 shall not have been
delivered to the Relevant Trustee within 30 days after such removal, the
Relevant Trustee may petition, at the expense of the Trust, any court of
competent jurisdiction for the appointment of a successor Relevant Trustee.
If any Trustee shall resign, be removed or become incapable of acting
as Trustee, or if a vacancy shall occur in the office of any Trustee for any
cause, at a time when no Debenture Event of Default shall have occurred and be
continuing, the Common Securityholder, by Act of the Common Securityholder
delivered to the retiring Trustee, shall promptly appoint a successor Trustee or
Trustees, and the retiring Trustee shall comply with the applicable requirements
of Section 8.11. If the Property Trustee or the Delaware Trustee shall resign,
be removed or become incapable of continuing to act as the Property Trustee or
the Delaware Trustee, as the case may be, at a time when a Debenture Event of
Default shall have occurred and be continuing, the Capital Securityholders, by
Act of the Securityholders of a
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majority in Liquidation Amount of the Capital Securities then Outstanding
delivered to the retiring Relevant Trustee, shall promptly appoint a successor
Relevant Trustee or Trustees, and such successor Trustee shall comply with the
applicable requirements of Section 8.11. If an Administrative Trustee shall
resign, be removed or become incapable of acting as Administrative Trustee, at a
time when a Debenture Event of Default shall have occurred and be continuing,
the Common Securityholder by Act of the Common Securityholder delivered to the
Administrative Trustee shall promptly appoint a successor Administrative Trustee
or Administrative Trustees and such successor Administrative Trustee or Trustees
shall comply with the applicable requirements of Section 8.11. If no successor
Relevant Trustee shall have been so appointed by the Common Securityholder or
the Capital Securityholders and accepted appointment in the manner required by
Section 8.11, any Securityholder who has been a Securityholder of Trust
Securities for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Relevant Trustee.
The Property Trustee shall give notice of each resignation and each
removal of a Trustee and each appointment of a successor Trustee to all
Securityholders in the manner provided in Section 10.9 and shall give notice to
the Depositor. 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.
Notwithstanding the foregoing or any other provision of this Trust
Agreement, in the event any Administrative Trustee or a Delaware Trustee who is
a natural person dies or becomes, in the opinion of the Depositor, incompetent
or incapacitated, the vacancy created by such death, incompetence or incapacity
may be filled by (a) the unanimous act of the remaining Administrative Trustees
if there are at least two of them or (b) otherwise by the Depositor (with the
successor in each case being a Person who satisfies the eligibility requirement
for Administrative Trustees or Delaware Trustee, as the case may be, 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 Trust and (b) shall add to or change any of the
provisions of this Trust Agreement as shall be necessary to
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provide for or facilitate the administration of the 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 written request of the Trust or any successor Relevant
Trustee such retiring Relevant Trustee shall, upon payment of all amounts owed
to it hereunder, 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 written request of any such successor Relevant Trustee, the 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 preceding paragraph.
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 such Person 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.
Section 8.13 Preferential Collection of Claims Against Depositor or
Trust.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
similar judicial proceeding relative to the Trust or any other obligor upon the
Trust Securities or the property of the Trust or of such other obligor or their
creditors, the Property Trustee (irrespective of whether any Distributions on
the Trust Securities shall then be due and payable as therein expressed or by
declaration or otherwise and irrespective of whether the Property Trustee shall
have made any demand on the Trust for the payment of any past due Distributions)
shall be entitled and empowered, to the fullest
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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 to authorize the
Property Trustee to vote in respect of the claim of any Holder in any such
proceeding.
Section 8.14 Reports by Property Trustee.
(a) The Property Trustee shall transmit to Securityholders 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. If required by Section 313(a) of the Trust
Indenture Act, the Property Trustee shall, within sixty days after each April 15
following the date of this Trust Agreement deliver to Securityholders a brief
report, dated as of such April 15, which complies with the provisions of such
Section 313(a).
(b) 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 Capital Securities are listed or
traded, if any, with the Commission and with the Depositor. The
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Depositor will promptly notify the Property Trustee of any such listing or
trading, or of any delisting thereof.
Section 8.15 Reports to the Property Trustee.
The Depositor and the Administrative Trustees on behalf of the Trust
shall provide to the Property Trustee such documents, reports and information as
required by Section 314 of the Trust Indenture Act (if any) and the compliance
certificate required by Section 314(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. Delivery of such reports, information and documents to the Property Trustee
is for informational purposes only and the Property Trustee's receipt of such
shall not constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Trust's
compliance with any of its covenants hereunder (as to which the Property Trustee
is entitled to rely exclusively on Officers' Certificates).
Section 8.16 Evidence of Compliance with Conditions Precedent.
Each of the Depositor and the Administrative Trustees on behalf of the
Trust shall provide to the Property Trustee such evidence of compliance with any
conditions precedent, if any, provided for in this 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 8.17 Number of Trustees.
(a) The number of Trustees shall be five initially, provided that the
Holder of all of the Common Securities by written instrument may increase or
decrease the number of Administrative Trustees. The Property Trustee and the
Delaware Trustee may be the same Person.
(b) If a Trustee ceases to hold office for any reason and the number of
Administrative Trustees is not reduced pursuant to Section 8.17(a), or if the
number of Trustees is increased pursuant to Section 8.17(a), a vacancy shall
occur. The vacancy shall be filled with a Trustee appointed in accordance with
Section 8.10.
(c) The death, resignation, retirement, removal, bankruptcy,
incompetence or incapacity to perform the duties of a Trustee shall not operate
to dissolve, terminate or annul the Trust. Whenever a vacancy in the number of
Administrative Trustees shall occur, until such vacancy is filled by the
appointment of an Administrative Trustee in accordance with Section 8.10, the
Administrative Trustees in office, regardless
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of their number (and notwithstanding any other provision of this Trust
Agreement), shall have all the powers granted to the Administrative Trustees and
shall discharge all the duties imposed upon the Administrative Trustees by this
Trust Agreement.
Section 8.18 Delegation of Power.
(a) Any Administrative Trustee may, by power of attorney consistent
with applicable law, delegate to any other natural person over the age of 21 his
or her power for the 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 Administrative Trustees shall have power to delegate from time
to time to such of their number or to the Depositor the doing of such things and
the execution of such instruments either in the name of the Trust or the names
of the Administrative Trustees or otherwise as the Administrative Trustees may
deem expedient, to the extent such delegation is not prohibited by applicable
law or contrary to the provisions of this Trust Agreement, as set forth herein.
ARTICLE IX
Termination, Liquidation and Merger
Section 9.1 Termination Upon Expiration Date.
Unless earlier terminated, the Trust shall automatically terminate on
September 23, 2052 (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 Holder of the Common Securities;
(b) the written direction to the Property Trustee from the Depositor at
any time to terminate the Trust and, after satisfaction of liabilities to
creditors of the Trust as provided by applicable law, distribute Debentures to
Securityholders in exchange for the Capital Securities (which direction is
optional and wholly within the discretion of the Depositor);
(c) the redemption of all of the Capital Securities in connection with
the redemption of all of the Debentures; and
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(d) the entry of an order for dissolution of the Trust by a court of
competent jurisdiction.
Section 9.3 Termination.
The respective obligations and responsibilities of the Trustees and the
Trust created and continued hereby shall terminate upon the latest to occur of
the following: (a) the distribution by the Property Trustee to Securityholders
upon the liquidation of the Trust pursuant to Section 9.4, or upon the
redemption of all of the Trust Securities pursuant to Section 4.2, of all
amounts required to be distributed hereunder upon the final payment of the Trust
Securities; (b) the payment of any expenses owed by the Trust; and (c) the
discharge of all administrative duties of the Administrative Trustees, including
the performance of any tax reporting obligations with respect to the Trust or
the Securityholders.
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 Trust shall be liquidated
by the Trustees as expeditiously as the Trustees determine to be possible by
distributing, after satisfaction or the making of reasonable provisions for the
payment of liabilities to creditors of the Trust as provided by applicable law,
to each Securityholder 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 later 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 notices of liquidation shall:
(i) state the CUSIP Number of the Trust Securities;
(ii) state the Liquidation Date;
(iii) state that from and after the Liquidation Date, the
Trust Securities will no longer be deemed to be Outstanding and any
Trust Securities Certificates not surrendered for exchange will be
deemed to represent a Like Amount of Debentures; and
(iv) provide such information with respect to the mechanics by
which Holders may exchange Trust Securities Certificates for
Debentures, or if Section 9.4(d) applies receive a Liquidation
Distribution, as the Administrative Trustees or the Property Trustee
shall deem appropriate.
(b) Except where Section 9.2(c) or 9.4(d) applies, in order to effect
the liquidation of the Trust and distribution of the Debentures to
Securityholders, the Property Trustee shall establish a record date for such
distribution (which shall be not
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more than 45 days prior to the Liquidation Date) and, either itself acting as
exchange agent or through the appointment of a separate exchange agent, shall
establish such procedures as it shall deem appropriate to effect the
distribution of Debentures in exchange for the Outstanding Trust 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 Trust Securities Certificates, upon surrender of such
certificates to the Administrative Trustees or their 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 as the Capital Securities are then listed or
traded, (iv) any Trust Securities Certificates not so surrendered for exchange
will be deemed to represent a Like Amount of Debentures, accruing interest at
the rate provided for in the Debentures from the last Distribution Date on which
a Distribution was made on such Trust 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 Trust Securities
Certificates with respect to such Debentures) and (v) all rights of
Securityholders holding Trust Securities will cease, except the right of such
Securityholders to receive Debentures upon surrender of Trust Securities
Certificates.
(d) In the event that, 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, the Trust Property shall be liquidated, and the Trust shall be
wound-up or terminated, by the Property Trustee. In such event, Securityholders
will be entitled to receive out of the assets of the Trust available for
distribution to Securityholders, after satisfaction of liabilities to creditors
of the 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 winding up or termination, the Liquidation Distribution can be paid
only in part because the Trust has insufficient assets available to pay in full
the aggregate Liquidation Distribution, then, subject to the next succeeding
sentence, the amounts payable by the 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
winding-up or termination pro rata (determined as aforesaid) with Holders of
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.
54
<PAGE> 61
Section 9.5 Mergers, Consolidations, Amalgamations or Replacements of
the Trust.
The Trust may not merge with or into, consolidate, amalgamate, or be
replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other Person, except pursuant
to this Article IX. At the request of the Depositor, with the consent of the
Administrative Trustees and without the consent of the Holders of the Capital
Securities, the Property Trustee or the Delaware Trustee, the 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 Trust with
respect to the Capital Securities or (b) substitutes for the Capital Securities
other securities having substantially the same terms as the Capital Securities
(the "Successor Securities") so long as the Successor Securities rank the same
as the Capital Securities rank in priority with respect to distributions and
payments upon liquidation, redemption and otherwise, (ii) the Depositor
expressly appoints a trustee of such successor entity possessing the same powers
and duties as the Property Trustee as the holder of the Debentures, (iii) the
Successor Securities are listed or traded, 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 or traded, if
any, (iv) such merger, consolidation, amalgamation, replacement, conveyance,
transfer or lease does not cause the Capital Securities (including any Successor
Securities) to be downgraded by any nationally recognized statistical rating
organization, (v) such merger, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights, preferences
and privileges of the Holders of the Capital Securities (including any Successor
Securities) in any material respect, (vi) such successor entity has a purpose
substantially identical to that of the Trust, (vii) prior to such merger,
consolidation, amalgamation, replacement, conveyance, transfer or lease, the
Depositor 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 Trust nor such successor entity will
be required to register as an investment company under the 1940 Act and (viii)
the Depositor 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, the Trust shall not, except with the consent of Holders of 100% in
Liquidation Amount of the
55
<PAGE> 62
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 Person or permit any other Person to consolidate,
amalgamate, merge with or into, or replace it if such consolidation,
amalgamation, merger, replacement, conveyance, transfer or lease would cause the
Trust or the successor entity to be classified as other than a grantor trust for
United States federal income tax purposes.
ARTICLE X
Miscellaneous Provisions
Section 10.1 Limitation of Rights of Securityholders.
The death, incapacity, liquidation, dissolution, termination or
bankruptcy 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 Securityholder 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 Liability of the Common Securityholder.
The Holder of the Common Securities shall be liable for all of the
debts and obligations of the Trust (other than with respect to the Trust
Securities) to the extent not satisfied out of the Trust's assets.
Section 10.3 Amendment.
(a) This Trust Agreement may be amended from time to time by the
Property Trustee, the Administrative Trustees and the Depositor, without the
consent of any Securityholders, (i) to cure any ambiguity, correct or supplement
any provision herein which may be inconsistent with any other provision herein,
or to make any other provisions with respect to matters or questions arising
under this 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 Trust will be classified for United States federal income tax
purposes as a grantor trust at all times that any Trust Securities are
Outstanding or to ensure that the Trust will not be required to register as an
investment company under the 1940 Act; provided, however, that in the case of
clause (i) or clause (ii), such action shall not adversely affect in any
material respect the interests of any Securityholder, and any such amendments of
this Trust Agreement shall become effective when notice thereof is given to the
Securityholders.
56
<PAGE> 63
(b) Except as provided in Section 10.3(c) hereof, any provision of this
Trust Agreement may be amended by the Trustees and the Depositor with (i) the
consent of Trust Securityholders representing not less than a majority (based
upon Liquidation Amounts) of the Trust Securities then Outstanding and (ii)
receipt by the Trustees of an Opinion of Counsel to the effect that such
amendment or the exercise of any power granted to the Trustees in accordance
with such amendment will not affect the Trust's status as a grantor trust for
United States federal income tax purposes or the Trust's exemption from status
of an investment company under the 1940 Act.
(c) In addition to and notwithstanding any other provision in this
Trust Agreement, without the consent of each affected Securityholder (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 Securityholder to institute suit
for the enforcement of any such payment on or after such date; notwithstanding
any other provision herein, without the unanimous consent of the Securityholders
(such consent being obtained in accordance with Section 6.3 or 6.6 hereof), this
paragraph (c) of this Section 10.3 may not be amended.
(d) Notwithstanding any other provisions of this Trust Agreement, no
Trustee shall enter into or consent to any amendment to this Trust Agreement
which would cause the Trust to fail or cease to qualify for the exemption from
status of an investment company under the 1940 Act or fail or cease to be
classified as a grantor trust for United States federal income tax purposes.
(e) Notwithstanding anything in this Trust Agreement to the contrary,
without the consent of the Depositor, this Trust Agreement may not be amended in
a manner which imposes any additional obligation on the Depositor.
(f) In the event that any amendment to this Trust Agreement is made,
the Administrative Trustees 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 which 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.
57
<PAGE> 64
Section 10.4 Separability.
In case any provision in this Trust Agreement or in the Trust
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
SECURITYHOLDERS, THE TRUST AND THE TRUSTEES 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 REGARD TO CONFLICT OF LAWS
PRINCIPLES).
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 interest shall
accrue thereon 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 Trust or the Relevant 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 Eight 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 which by any
provision of this Trust Agreement is required or permitted to be given or served
to or upon any Securityholder or the Depositor may be given or served in writing
by deposit thereof, first-class postage prepaid, in the United States mail, hand
delivery or facsimile transmission, in each case, addressed, (a) in the case of
a Capital Securityholder, to such Capital Securityholder as such
Securityholder's name and address may appear on the Securities Register; and (b)
in the case of the Common
58
<PAGE> 65
Securityholder or the Depositor, to USBANCORP, Inc., Main and Franklin Streets,
Johnstown, Pennsylvania 15907, Attention: Chief Financial Officer, facsimile
no.: (814) 533-5383. Such notice, demand or other communication to or upon a
Securityholder shall be deemed to have been sufficiently given or made, for all
purposes, upon hand delivery, mailing or transmission.
Any notice, demand or other communication which by any provision of
this Trust Agreement is required or permitted to be given or served to or upon
the Trust, the Property Trustee, the Delaware Trustee or the Administrative
Trustees shall be given in writing addressed (until another address is published
by the Trust) as follows: (a) with respect to the Property Trustee to The Bank
of New York, 101 Barclay Street, New York, New York 10286, Attention: Corporate
Trust, Trustee Administration; (b) with respect to the Delaware Trustee, to The
Bank of New York (Delaware), White Clay Center, Route 273, Newark, Delaware,
with a copy to the Property Trustee at the address set forth in Clause (a); and
(c) with respect to the Administrative Trustees, to them at the address above
for notices to the Depositor, marked "Attention Administrative Trustees of
USBANCORP Capital Trust I." Such notice, demand or other communication to or
upon the Trust or the Property Trustee shall be deemed to have been sufficiently
given or made only upon actual receipt of the writing by the Trust or the
Property Trustee.
Section 10.10 Agreement Not to Petition.
Each of the Trustees and the Depositor agree for the benefit of the
Securityholders that, until at least one year and one day after the Trust has
been terminated in accordance with Article IX, they shall not file, or join in
the filing of, a petition against the Trust under any bankruptcy, insolvency,
reorganization or other similar law (including, without limitation, the United
States Bankruptcy Code) (collectively, "Bankruptcy Laws") or otherwise join in
the commencement of any proceeding against the Trust under any Bankruptcy Law.
In the event the Depositor takes action in violation of this Section 10.10, the
Property Trustee agrees, for the benefit of Securityholders, 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 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 stopped and precluded
therefrom and such other defenses, if any, as counsel for the Property Trustee
or the Trust may assert. The provisions of this Section 10.10 shall survive the
termination of this Trust Agreement.
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 or deemed to be part of
59
<PAGE> 66
this Trust Agreement and shall, to the extent applicable, be governed by such
provisions.
(b) The Property Trustee shall be the only Trustee which is a trustee
for the purposes of the Trust Indenture Act.
(c) If any provision hereof limits, qualifies or conflicts with another
provision hereof which is required or deemed to be included in this Trust
Agreement by any of the provisions of the Trust Indenture Act, such required or
deemed provision 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 Trust.
Section 10.12 Acceptance of Terms of Trust Agreement, Guarantee and
Indenture.
THE RECEIPT AND ACCEPTANCE OF A TRUST SECURITY OR ANY INTEREST THEREIN
BY OR ON BEHALF OF A SECURITYHOLDER OR ANY BENEFICIAL OWNER, WITHOUT ANY
SIGNATURE OR FURTHER MANIFESTATION OF ASSENT, SHALL CONSTITUTE THE UNCONDITIONAL
ACCEPTANCE BY THE SECURITYHOLDER AND ALL OTHERS HAVING A BENEFICIAL INTEREST IN
SUCH TRUST SECURITY OF ALL THE TERMS AND PROVISIONS OF THIS TRUST AGREEMENT AND
AGREEMENT TO THE SUBORDINATION PROVISIONS AND OTHER TERMS OF THE GUARANTEE AND
THE INDENTURE, AND SHALL CONSTITUTE THE AGREEMENT OF THE TRUST, SUCH
SECURITYHOLDER AND SUCH OTHERS THAT THE TERMS AND PROVISIONS OF THIS TRUST
AGREEMENT SHALL BE BINDING, OPERATIVE AND EFFECTIVE AS BETWEEN THE TRUST AND
SUCH SECURITYHOLDER AND SUCH OTHERS.
Section 10.13 Holders are Parties.
Notwithstanding that Holders have not executed and delivered this Trust
Agreement or any counterpart thereof, Holders shall be deemed to be parties to
this Trust Agreement and shall be bound by all of the terms and conditions
hereof and of the Trust Securities by acceptance and delivery of the Trust
Securities.
Section 10.14 Counterparts.
This Trust Agreement may contain more than one counterpart of the
signature page and this Trust Agreement may be executed by the affixing of the
signature of each of the Trustees of one of such counterpart signature pages.
All of such counterpart signature pages shall be read as though one, and they
shall have the same force and effect as though all of the signers had signed a
single signature page.
60
<PAGE> 67
USBANCORP, INC.
By:_______________________________
Name:
Title:
THE BANK OF NEW YORK,
as Property Trustee
By:_______________________________
Name:
Title:
THE BANK OF NEW YORK (DELAWARE),
as Delaware Trustee
By:_______________________________
Name:
Title:
__________________________________
Terry K. Dunkle,
as Administrative Trustee
__________________________________
Jeffrey A. Stopko,
as Administrative Trustee
__________________________________
Anthony M. V. Eramo,
as Administrative Trustee
61
<PAGE> 68
EXHIBIT A
1
<PAGE> 69
CERTIFICATE OF TRUST OF
USBANCORP CAPITAL TRUST I
THIS Certificate of Trust of USBANCORP Capital Trust I (the
"Trust") is being duly executed and filed by The Bank of New York (Delaware),
The Bank of New York, Terry K. Dunkle, Jeffrey S. Stopko and Anthony M. V.
Eramo, as trustees, to form a business trust under the Delaware Business Trust
Act (12 Del. C. Section 3801 et seq.).
1. Name. The name of the business trust formed hereby is
USBANCORP Capital Trust I.
2. Delaware Trustee. The name and business address of the
trustee of the Trust in the State of Delaware is The Bank of New York
(Delaware), White Clay Center, Newark, Delaware 19711.
3. Effective Date. This Certificate of Trust shall be
effective upon filing with the Secretary of State.
IN WITNESS WHEREOF, the undersigned, being the trustees of the
Trust, have executed this Certificate of Trust as of the date first above
written.
THE BANK OF NEW YORK (DELAWARE),
not in its individual capacity but
solely sa Trustee of the Trust
By:________________________________
Name:
Title:
THE BANK OF NEW YORK, not in its
individual capacity but solely as
Trustee of the Trust
By:________________________________
Name:
Title:
___________________________________
TERRY K. DUNKLE, not in his
individual capacity but solely as
Trustee of the Trust
2
<PAGE> 70
___________________________________
JEFFREY A. STOPKO, not in his
individual capacity but solely as
Trustee of the Trust
___________________________________
ANTHONY M. V. ERAMO, not in his
individual capacity but solely as
Trustee of the Trust
3
<PAGE> 71
EXHIBIT B
1
<PAGE> 72
EXHIBIT C
1
<PAGE> 73
EXHIBIT D
1
<PAGE> 1
Exhibit 4.6
This Capital Security is a Global Certificate within the meaning of the
Trust Agreement hereinafter referred to and is registered in the name of The
Depository Trust Company (the "Depositary") or a nominee of the Depositary. This
Capital Security is exchangeable for Capital Securities registered in the name
of a person other than the Depositary or its nominee only in the limited
circumstances described in the Trust Agreement and no transfer of this Capital
Security (other than a transfer of this Capital Security as a whole by the
Depositary to a nominee of the Depositary or by a nominee of the Depositary to
the Depositary or another nominee of the Depositary) may be registered except in
such limited circumstances.
Unless this Capital Security is presented by an authorized representative
of the Depositary to USBANCORP Capital Trust I or its agent for registration of
transfer, exchange or payment, and any Capital Security issued is registered in
the name of Cede & Co. or such other name as requested by an authorized
representative of the Depositary and any payment hereon is made to Cede & Co. or
to such other entity as is requested by an authorized representative of the
Depositary, ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A
PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an
interest herein.
Certificate No.: Number of Capital Securities: __________________
P-__ Aggregate Liquidation Amount
of Capital Securities: $_________________
CUSIP No. ____________________
Certificate Evidencing Capital Securities
of
USBANCORP CAPITAL TRUST I
_______ Capital Securities, Series A
(Liquidation Amount $25 per Capital Security)
USBANCORP Capital Trust I, a statutory business trust
created under the laws of the State of Delaware (the "Trust"),
1
<PAGE> 2
hereby certifies that Cede & Co. (the "Holder") is the registered owner of
capital securities in the aggregate liquidation amount of $30,000,000 of the
Trust representing an undivided beneficial ownership interest in the assets of
the Trust and designated the USBANCORP Capital Trust I _____% Capital
Securities, Series A (liquidation amount $25 per Capital Security) (the
"Capital Securities"). The Capital Securities are transferable on the books and
records of the Trust, in person or by a duly authorized attorney, upon
surrender of this certificate duly endorsed and in proper form for transfer as
provided in Section 5.4 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 Amended and Restated Trust
Agreement of the Trust dated as of April ___, 1998, as the same may be amended
from time to time (the "Trust Agreement"), including the designation of the
terms of Capital Securities as set forth therein. The Holder is entitled to the
benefits of the Guarantee Agreement entered into by USBANCORP, Inc., a
Pennsylvania corporation (the "Company"), and The Bank of New York, a New York
banking corporation ("The Bank of New York"), as guarantee trustee, dated as of
April ___, 1998 (the "Guarantee"), to the extent provided therein. The Trust
will furnish a copy of the Trust Agreement and the Guarantee to the Holder
without charge upon written request to the 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 and by acceptance hereof
agrees to the provisions of (i) the Guarantee and (ii) the Junior Subordinated
Indenture entered into by the Company and The Bank of New York, as trustee,
dated as of April 1, 1998.
2
<PAGE> 3
IN WITNESS WHEREOF, one of the Administrative Trustees of the Trust
has executed this certificate.
USBANCORP CAPITAL TRUST I
By:
--------------------------
--------------------------
Administrative Trustee
This is one of the Securities referred to in the within mentioned
Trust Agreement.
Date of Authentication:
, 1998
- -------------
The Bank of New York, as Property Trustee
By:
-----------------------------
Name:
Title:
3
<PAGE> 4
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 Securities Certificate on the books of the
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-15.1
4
<PAGE> 1
EXHIBIT 4.7
----------------------------------------------------------------
GUARANTEE AGREEMENT
BETWEEN
USBANCORP, INC.
(AS GUARANTOR)
AND
THE BANK OF NEW YORK
(AS TRUSTEE)
DATED AS OF
APRIL __, 1998
----------------------------------------------------------------
<PAGE> 2
CROSS-REFERENCE TABLE*
<TABLE>
<CAPTION>
Section of
Trust Indenture Act Section of
of 1939, as amended Guarantee Agreement
- ------------------- -------------------
<S> <C>
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(b)
318(b)............................................................ 2.1
318(c)............................................................ 2.1(a)
</TABLE>
- ----------
* 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> 3
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
ARTICLE I - DEFINITIONS ................................................... 2
Section 1.1 Definitions............................................. 2
ARTICLE II - TRUST INDENTURE ACT .......................................... 4
Section 2.1 Trust Indenture Act; Application........................ 4
Section 2.2 List of Holders......................................... 4
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.................................................................... 6
Section 3.1 Powers and Duties of the Guarantee
Trustee.............................................................. 6
Section 3.2 Certain Rights of Guarantee Trustee..................... 8
Section 3.3 Indemnity............................................... 10
ARTICLE IV - GUARANTEE TRUSTEE............................................. 10
Section 4.1 Guarantee Trustee: Eligibility.......................... 10
Section 4.2 Appointment, Removal and Resignation of
the Guarantee Trustee................................................ 11
ARTICLE V - GUARANTEE...................................................... 12
Section 5.1 Guarantee............................................... 12
Section 5.2 Waiver of Notice and Demand............................. 12
Section 5.3 Obligations Not Affected................................ 12
Section 5.4 Rights of Holders....................................... 13
Section 5.5 Guarantee of Payment.................................... 13
Section 5.6 Subrogation............................................. 14
Section 5.7 Independent Obligations................................. 14
ARTICLE VI - COVENANTS AND SUBORDINATION................................... 14
Section 6.1 Subordination........................................... 14
Section 6.2 Pari Passu Guarantees................................... 14
ARTICLE VII - TERMINATION.................................................. 15
Section 7.1 Termination............................................. 15
ARTICLE VIII - MISCELLANEOUS............................................... 15
Section 8.1 Successors and Assigns.................................. 15
Section 8.2 Amendments.............................................. 15
Section 8.3 Notices................................................. 15
Section 8.4 Benefit................................................. 16
Section 8.5 Interpretation.......................................... 16
Section 8.6 Governing Law........................................... 17
</TABLE>
(i)
<PAGE> 4
GUARANTEE AGREEMENT
This GUARANTEE AGREEMENT, dated as of April __, 1998, is executed and
delivered by USBANCORP, INC., a Pennsylvania corporation (the "Guarantor")
having its principal office at Main and Franklin Streets, Johnstown,
Pennsylvania 15907, and THE BANK OF NEW YORK, 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 and Common Securities (each
as defined herein and together, the "Securities") of USBANCORP Capital Trust I,
a Delaware statutory business trust (the "Issuer").
WHEREAS, pursuant to an Amended and Restated Trust Agreement, dated as of
April __, 1998 (the "Trust Agreement"), among the Guarantor, as Depositor, the
Property Trustee and the Delaware Trustee named therein, the Administrative
Trustees named therein and the Holders from time to time of undivided beneficial
interests in the assets of the Issuer, the Issuer is issuing $_____________
aggregate Liquidation Amount (as defined in the Trust Agreement) of its _____%
Capital Securities, Series A, Liquidation Amount $25 per preferred security (the
"Capital Securities") representing preferred undivided beneficial interests in
the assets of the Issuer and having the terms set forth in the Trust Agreement;
WHEREAS, the Capital Securities will be issued by the Issuer and the
proceeds thereof, together with the proceeds from the issuance of the Issuer's
Common Securities (as defined herein), will be used to purchase the Debentures
(as defined in the Trust Agreement) of the Guarantor which will be deposited
with The Bank of New York, as Property Trustee under the Trust Agreement, as
trust assets; and
WHEREAS, as incentive for the Holders to purchase Securities the Guarantor
desires irrevocably and unconditionally to agree, to the extent set forth
herein, to pay to the Holders of the Securities the Guarantee Payments (as
defined herein) and to make certain other payments on the terms and conditions
set forth herein.
NOW, THEREFORE, in consideration of the purchase by each Holder of
Securities, which purchase the Guarantor hereby agrees shall benefit the
Guarantor, the Guarantor executes and delivers this Guarantee Agreement for the
benefit of the Holders from time to time of the Securities.
1
<PAGE> 5
ARTICLE I - DEFINITIONS
Section 1.1 Definitions.
As used in this Guarantee Agreement, the terms set forth below shall,
unless the context otherwise requires, have the following meanings. Capitalized
or otherwise defined terms used but not otherwise defined herein shall have the
meanings assigned to such terms in the Trust Agreement as in effect on the date
hereof.
"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; provided, however, that an Affiliate of the
Guarantor shall not be deemed to be an Affiliate of the Issuer. 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 either the board of directors of the Guarantor
or any committee of that board duly authorized to act hereunder or any directors
or officers of the Guarantor to whom such board of directors or such committee
shall have duly delegated its authority.
"Common Securities" means the securities representing common undivided
beneficial interests in the assets of the Issuer.
"Event of Default" means a default by the Guarantor on any of its payment
or other obligations under this Guarantee Agreement; provided, however, that,
except with respect to a default in payment of any Guarantee Payments, the
Guarantor shall have received notice of default and shall not have cured such
default within 90 days after receipt of such notice.
"Guarantee Payments" means the following payments or distributions,
without duplication, with respect to the Securities, to the extent not paid or
made by or on behalf of the Issuer: (i) any accumulated and unpaid Distributions
(as defined in the Trust Agreement) required to be paid on the Securities, to
the extent the Issuer shall have funds on hand available therefor at such time,
(ii) the redemption price, including all accrued and unpaid Distributions to the
date of redemption (the "Redemption Price"), with respect to any Securities
called for redemption by the Issuer, to the extent the Issuer shall have funds
on hand available therefor at such time, and (iii) upon a voluntary or
involuntary termination, winding up or liquidation of the Issuer, unless
Debentures are distributed to the Holders, the lesser of (a) the aggregate of
the Liquidation Amount plus accrued and unpaid Distributions to the date of
payment and (b)
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the amount of assets of the Issuer remaining available for distribution to
Holders in liquidation of the Issuer after satisfaction of liabilities to
creditors of the Issuer as required by applicable law (in either case, the
"Liquidation Distribution").
"Guarantee Trustee" means The Bank of New York, 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.
"Holder" means any holder, as registered on the books and records of the
Issuer, of any Securities; provided, however, that in determining whether the
holders of the requisite percentage of 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 April 1,
1998, as supplemented and amended between the Guarantor and The Bank of New
York, as trustee.
"List of Holders" has the meaning specified in Section 2.2(a).
"Majority in aggregate Liquidation Amount of the Securities" means, except
as provided by the Trust Indenture Act, a vote by the Holder(s), voting
separately as a class, of more than 50% of the aggregate Liquidation Amount of
all then outstanding Securities issued by the Issuer.
"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
such Person, 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 be without personal liability and shall
include:
(a) a statement that each officer signing the Officers' Certificate has
read the covenant or condition and the definitions relating thereto;
(b) a brief statement of the nature and scope of the examination or
investigation undertaken by each officer in rendering the Officers' Certificate;
(c) a statement that each officer has made such examination or
investigation as, in such officer's opinion, is necessary to
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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 each 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, limited
liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever nature.
"Responsible Officer" when used with respect to the Guarantee Trustee
means any officer of the Guarantee Trustee assigned by the Guarantee Trustee
from time to time to administer its corporate trust matters.
"Successor Guarantee Trustee" means a successor Guarantee Trustee
possessing the qualifications to act as Guarantee Trustee under Section 4.1.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended.
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, such imposed duties shall control.
Section 2.2 List of Holders.
(a) The Guarantor will furnish or cause to be furnished to the Guarantee
Trustee:
(i) quarterly, not more than 15 days after December 15, March 15,
June 15, and September 15 in each year, a list, in such form as the
Guarantee Trustee may reasonably require, of the names and addresses of
the Holders as of such December 15, March 15, June 15, and September 15,
and
(ii) 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 similar form and
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content as of a date not more than 15 days prior to the time such list is
furnished,
excluding from any such list names and addresses received by the Guarantee
Trustee in its capacity as Securities Registrar.
(b) The Guarantee Trustee shall comply with its obligations under Section
311(a), Section 311(b) and Section 312(b) of the Trust Indenture Act.
Section 2.3 Reports by the Guarantee Trustee.
The Guarantee Trustee shall transmit to Holders such reports concerning
the Guarantee Trustee and its actions under this Guarantee Agreement as may be
required pursuant to the Trust Indenture Act at the times and in the manner
provided pursuant thereto. If required by Section 313(a) of the Trust Indenture
Act, the Guarantee Trustee shall, within sixty days after each April 15
following the date of this Guarantee Agreement deliver to Holders a brief
report, dated as of such April 15, which complies with the provisions of such
Section 313(a).
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.
Delivery of such reports, information and documents to the Guarantee Trustee is
for informational purposes only and the Guarantee Trustee's receipt of such
shall not constitute constructive notice of any information contained therein,
including the Guarantor's compliance with any of its covenants hereunder (as to
which the Guarantee Trustee is entitled to rely exclusively on Officers'
Certificates).
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 pursuant to Section 314(c)(1) may be given in the form of an
Officers' Certificate.
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Section 2.6 Events of Default; Waiver.
The Holders of a Majority in aggregate Liquidation Amount of the
Securities may, by vote, on behalf of the Holders, waive any past Event of
Default and its consequences. Upon such waiver, any such Event of Default shall
cease to exist, and any Event of Default arising therefrom shall be deemed to
have been cured, for every 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 therefrom.
Section 2.7 Event of Default; Notice.
(a) The Guarantee Trustee shall, within 90 days after the occurrence of an
Event of Default, transmit by mail, first class postage prepaid, to the Holders,
notices of all Events of Default actually known to the Guarantee Trustee, unless
such defaults have 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 written notice, of such Event of
Default.
Section 2.8 Conflicting Interests.
The Trust Agreement 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 a Holder exercising his or her rights
pursuant to Section 5.4(iv) or to a Successor Guarantee Trustee on acceptance by
such Successor Guarantee Trustee of its appointment to act as Successor
Guarantee Trustee. The right, title and interest of the Guarantee Trustee 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
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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 Guarantee
Agreement against the Guarantee Trustee. In case 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 willful 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, 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;
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(iii) the Guarantee Trustee shall not be liable with respect to any
action taken or omitted to be taken by it in good faith in accordance with
the direction of the Holders of not less than a Majority in aggregate
Liquidation Amount of the Securities relating to the time, method and
place of conducting any proceeding for any remedy available to the
Guarantee Trustee, or exercising any trust or power conferred upon the
Guarantee Trustee under this Guarantee Agreement; and
(iv) 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.
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 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 of its
selection, and the 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
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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 or attorneys, and the Guarantee Trustee shall not be
responsible for any misconduct or negligence on the part of any such agent
or attorney appointed with due care by it hereunder.
(viii) Whenever in the administration of this Guarantee Agreement
the Guarantee Trustee shall deem it desirable to receive written
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 written instructions are received, and
(C) shall be protected in acting in accordance with such written
instructions.
(ix) The Guarantee Trustee shall not be liable for any action taken,
suffered, or omitted to be taken by it in good faith and reasonably
believed by it to be authorized or
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within the discretion or rights or powers conferred upon it by this
Guarantee Agreement.
(x) The Trustee shall not be deemed to have notice of any Default of
Event of Default unless a Responsible Officer of the Trustee has actual
knowledge thereof or unless written notice of any event which is in fact
such a default is received by the Trustee at the Corporate Trust Office of
the Trustee, and such notice references the Securities and this Indenture.
(xi) The rights, privileges, protections, immunities and benefits
given to the Trustee, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Trustee in
each of its capacities hereunder, and to each agent, custodian and other
Person employed to act hereunder.
(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 Indemnity.
The Guarantor agrees to indemnify the Guarantee Trustee for, and to hold
it harmless against, any and all loss, liability, damage, claim or expense
(including reasonable attorneys' fees and expenses) incurred without negligence
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 provisions of this section shall survive the termination
of this Guarantee Agreement.
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
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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 the supervising or examining
authority, then, for the purposes of this Section 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).
(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(b), the Guarantee Trustee may be appointed or
removed without cause at any time by the Guarantor.
(b) The Guarantee Trustee shall not be removed 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. If an instrument of acceptance by a Successor Guarantee Trustee shall
not have been delivered to the Guarantee Trustee within 30 days after such
removal, the Guarantee Trustee being removed may petition any court of competent
jurisdiction for the appointment of a Successor Guarantee Trustee.
(c) The Guarantee Trustee appointed hereunder shall hold office until a
Successor Guarantee Trustee shall have been appointed or until its removal or
resignation. The Guarantee Trustee may resign from office (without need for
prior or subsequent accounting) by an instrument in writing executed by the
Guarantee Trustee and delivered to the Guarantor, which resignation shall not
take effect until a Successor Guarantee Trustee has been appointed and has
accepted such appointment by instrument in writing executed by such Successor
Guarantee Trustee and delivered to the Guarantor and the resigning Guarantee
Trustee.
(d) If no Successor Guarantee Trustee shall have been appointed and
accepted appointment as provided in this Section 4.2 within 60 days after
delivery to the Guarantor of an instrument of resignation, the resigning
Guarantee Trustee may
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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.
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), as and when due, regardless of any defense,
right of set-off or counterclaim which the Issuer may have or assert. The
Guarantor's obligation to make a Guarantee Payment may be satisfied by direct
payment of the required amounts by the Guarantor to the Holders or by causing
the Issuer to pay such amounts to the Holders.
Section 5.2 Waiver of Notice and Demand.
The Guarantor hereby waives notice of acceptance of the 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, Issuer 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:
(a) the release or waiver, by operation of law or otherwise, of the
performance or observance by the Issuer of any express or implied agreement,
covenant, term or condition relating to the Securities to be performed or
observed by the Issuer;
(b) the extension of time for the payment by the Issuer 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 Securities or the
extension of time for the performance of any other obligation under, arising out
of, or in connection with, the Securities;
(c) any failure, omission, delay or lack of diligence on the part of the
Holders to enforce, assert or exercise any right,
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privilege, power or remedy conferred on the Holders pursuant to the terms of the
Securities, or any action on the part of the Issuer granting indulgence or
extension of any kind;
(d) the voluntary or involuntary liquidation, dissolution, sale of any
collateral, receivership, insolvency, bankruptcy, assignment for the benefit of
creditors, reorganization, arrangement, composition or readjustment of debt of,
or other similar proceedings affecting, the Issuer or any of the assets of the
Issuer;
(e) any invalidity of, or defect or deficiency in, the Securities;
(f) the settlement or compromise of any obligation guaranteed hereby or
hereby incurred; or
(g) any other circumstance whatsoever that might otherwise constitute a
legal or equitable discharge or defense of a guarantor, it being the intent of
this Section 5.3 that the obligations of the Guarantor hereunder shall be
absolute and unconditional under any and all circumstances.
There shall be no obligation of the 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 aggregate
Liquidation Amount of the Securities have the right to direct the time, method
and place of conducting any proceeding for any remedy available to the Guarantee
Trustee in respect of this Guarantee 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 or any other Person.
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) or upon distribution of Debentures to Holders as provided in the
Trust Agreement.
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Section 5.6 Subrogation.
The Guarantor shall be subrogated to all (if any) rights of the Holders
against the Issuer in respect of any amounts paid to the Holders by the
Guarantor under this Guarantee Agreement and shall have the right to waive
payment by the Issuer pursuant to Section 5.1; 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 with respect to the Securities and that the
Guarantor shall be liable as principal and as debtor hereunder to make Guarantee
Payments pursuant to the terms of this Guarantee 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 Debt (as defined in the Indenture) of
the Guarantor, except those made pari passu or subordinate to such obligations
expressly by their terms in the same manner as set forth in Article XIII of the
Indenture.
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 any similar Guarantee
Agreements issued by the Guarantor on behalf of the holders of preferred
securities issued by any Trust (as defined in the Indenture).
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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 of all Securities, (ii) the
distribution of Debentures to the Holders in exchange for all of the Securities
or (iii) full payment of the amounts payable in accordance with the Trust
Agreement upon liquidation of the Issuer. 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 must restore payment of any sums paid
with respect to 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 Securities then
outstanding. Except in connection with a consolidation, merger or sale involving
the Guarantor that is not prohibited 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.
Section 8.2 Amendments.
Except with respect to any changes which do not adversely affect the
rights of the Holders or the Guarantee Trustee in any material respect (in which
case no consent of the Holders or the Guarantee Trustee, as the case may be,
will be required), this Guarantee Agreement may only be amended with the prior
approval of the Holders of not less than a Majority in aggregate Liquidation
Amount of all the outstanding Securities and of the Guarantee Trustee. The
provisions of Article VI of the Trust Agreement concerning meetings of the
Holders shall apply to the giving of such approval.
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 set forth below or such
other address, facsimile number or to the attention of such other Person as the
Guarantor may give notice to the Holders:
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USBANCORP, INC.
Main and Franklin Streets
Johnstown, PA 15907
Facsimile No.: 814-533-5383
Attention: Chief Financial Officer
(b) if given to the Issuer, in care of the Guarantee Trustee, at the
Issuer's (and the Guarantee Trustee's) address set forth below or such other
address as the Guarantee Trustee on behalf of the Issuer may give notice to the
Holders:
USBANCORP Capital Trust I
c/o USBANCORP, INC.
Main and Franklin Streets
Johnstown, PA 15907
Facsimile No.: 814-533-5383
Attention: Jeffrey A. Stopko
with a copy to:
The Bank of New York
101 Barclay Street, Floor 21 West
New York, New York 10286
Facsimile No.: 212-815-5915
Attention: Corporate Trust, Trustee Administration
(c) if given to any Holder, at the address set forth on the books and
records of the Issuer.
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.
This Guarantee Agreement is solely for the benefit of the Holders and is
not separately transferable from the Securities.
Section 8.5 Interpretation.
In this Guarantee Agreement, unless the context otherwise requires:
(a) capitalized terms used in this Guarantee Agreement but not defined in
the preamble hereto have the respective meanings assigned to them in Section
1.1;
16
<PAGE> 20
(b) a term defined anywhere in this Guarantee Agreement has the same
meaning throughout;
(c) all references to "the Guarantee Agreement" or "this Guarantee
Agreement" are to this Guarantee Agreement as modified, supplemented or amended
from time to time;
(d) all references in this Guarantee Agreement to Articles and Sections
are to Articles and Sections of this Guarantee Agreement unless otherwise
specified;
(e) a term defined in the Trust Indenture Act has the same meaning when
used in this Guarantee Agreement unless otherwise defined in this Guarantee
Agreement or unless the context otherwise requires;
(f) a reference to the singular includes the plural and vice versa; and
(g) the masculine, feminine or neuter genders used herein shall include
the masculine, feminine and neuter genders.
Section 8.6 Governing Law.
THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND
INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO THE CONFLICT OF LAW PRINCIPLES THEREOF.
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.
THIS GUARANTEE AGREEMENT is executed as of the day and year first above
written.
USBANCORP, INC.
By:_______________________________
Name:
Title:
THE BANK OF NEW YORK
as Guarantee Trustee
By:_______________________________
Name:
Title:
17
<PAGE> 1
EXHIBIT 5.1
April __, 1998
USBANCORP Capital Trust I
USBANCORP, Inc.
Main and Franklin Streets
Johnstown, Pennsylvania 15907
Ladies and Gentlemen:
We have acted as counsel to USBANCORP, Inc., a Pennsylvania corporation
(the "Company"), and USBANCORP Capital Trust I, a business trust formed under
the Business Trust Act of the State of Delaware (Chapter 38, Title 12, of the
Delaware Code, 12 Del L. Sec. 3801 et. seq.) (the "Trust"), in connection with
the preparation of the Registration Statement on Form S-3 filed by the Company
and the Trust with respect to the registration under the Securities Act of 1933,
as amended (the "Act"), of (i) the guarantee by the Company of 1,200,000 of the
Trust's _____% capital securities, liquidation amount of $25 per capital
security (the "Capital Securities") with respect to distributions and payments
upon liquidation, redemption and otherwise (the "Guarantee"), (ii) $30,927,850
principal amount of _____% Junior Subordinated Deferrable Interest Debentures
due June 30, 2028 (the "Junior Subordinated Debentures") to be issued by the
Company and (iii) the Capital Securities.
This opinion is being provided in accordance with the requirements of
Item 601(b)(5) of Regulation S-K under the Securities Act of 1933, as amended
(the "Act").
In connection with this opinion, we have reviewed originals or copies,
certified or otherwise identified to our satisfaction, of the following
documents:
<PAGE> 2
April __, 1998
Page 2
(i) the Registration Statement on Form S-3 (File No. 333-50225) as
filed by the Company and the Trust with the Securities and Exchange Commission
(the "Commission") on April __, 1998 under the Act, and Amendment No. 1 thereto
filed with the Commission on April 23, 1998 (such Registration Statement, as so
amended, being hereinafter referred to as the "Registration Statement");
(ii) the Certificate of Trust of the Trust filed with the Secretary of
State of the State of Delaware on April 15, 1998;
(iii) the Amended and Restated Trust Agreement of the Trust, dated as
of April __, 1998 (the "Declaration"), among Terry K. Dunkle, Jeffrey A. Stopko,
and Anthony M.V. Eramo, as administrative trustees, The Bank of New York, as
property trustee (the "Property Trustee") and The Bank of New York (Delaware),
as Delaware trustee;
(iv) the form of the Capital Securities and a specimen certificate
thereof;
(v) an executed copy of the Indenture, dated as of April 1, 1998 (the
"Indenture"), between The Bank of New York, as Indenture Trustee, and the
Company;
(vi) the form of the Junior Subordinated Debentures and a specimen
certificate thereof;
(vii) the Guarantee;
<PAGE> 3
April __, 1998
Page 3
(viii) the Articles of Incorporation and Bylaws of the Company as
certified by the Secretary of the Company, and
(ix) resolutions adopted by the Board of Directors of the Company on
April __, 1998 and April __, 1998 as certified by the Secretary of the Company.
-------------------------------------
Based upon our review of the foregoing documents, and subject to the
qualifications set forth below, it is our opinion that when the Registration
Statement becomes effective:
1. The Guarantee has been duly authorized by the Company, and
when (i) the Declaration and Indenture have been qualified under the Trust
Indenture Act of 1939, as amended, and (ii) the Guarantee is duly executed and
delivered by the Company and issued in the exchange offer as contemplated by the
Registration Statement, the Guarantee will constitute a valid, legal and binding
agreement of the Company in favor of the holders of Capital Securities,
enforceable against the Company in accordance with its terms, except to the
extent that enforcement thereof may be limited by (1) bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or other similar laws now or
hereafter in effect relating to creditors' rights generally and (2) general
principles of equity (regardless of whether enforceability is considered in a
proceeding at law or in equity).
2. The Junior Subordinated Debentures have been duly
authorized for issuance by the Company, and when (i) the
<PAGE> 4
April __, 1998
Page 4
Declaration and Indenture have been qualified under the Trust Indenture Act of
1939, as amended, and (ii) the Junior Subordinated Debentures are duly executed,
authenticated and issued in accordance with the Indenture and delivered and
issued in the exchange offer as contemplated by the Registration Statement, the
Junior Subordinated Debentures will constitute valid and binding obligations of
the Company enforceable against the Company in accordance with their terms,
except to the extent that enforcement thereof may be limited by (1) bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance or other similar
laws now or hereafter in effect relating to creditors' rights generally and (2)
general principles of equity (regardless of whether enforceability is considered
in a proceeding at law or in equity).
3. The Capital Securities have been duly authorized for
issuance by the Trust, and when (i) the Declaration has been qualified under the
Trust Indenture Act of 1939, as amended, and (ii) the Capital Securities are
duly executed, authenticated and issued in accordance with the Declaration and
delivered and issued in the exchange offer as contemplated by the Registration
Statement, the Capital Securities will represent, subject to the qualifications
set forth in paragraph 4 below, fully paid and nonassessable undivided
beneficial interests in the assets of the Trust and will entitle the holders
thereof to the benefits of the Declaration except to the extent that enforcement
of the Declaration may be limited by (1) bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally and (2) general
<PAGE> 5
April __, 1998
Page 5
principles of equity regardless of whether enforcement is considered in a
proceeding in equity or at law.
4. The holders of the Capital Securities 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 bring to your attention, however, that the holders of the
Capital Securities may be obligated, pursuant to the Declaration, to (i) provide
indemnity and/or security in connection with, and pay taxes or governmental
charges arising from, transfers of Capital Securities and (ii) provide security
and indemnity in connection with requests of or directions to the Property
Trustee to exercise its rights and powers under the Declaration.
---------------------------
In providing this opinion we have assumed, without investigation, the
authenticity of documents submitted to us as originals, the conformity to the
originals of any document submitted to us as a copy, the authenticity of the
originals of such documents submitted to us as copies, the genuineness of all
signatures and the legal capacities of natural persons. In addition, we have
assumed that each of the entities or persons other than the Company, the Trust
and their respective representatives executing the documents had the power and
authority to enter into and perform all of its obligations under such documents,
and have also assumed the due execution and delivery of these documents by each
such entity or person.
<PAGE> 6
April __, 1998
Page 6
We hereby consent to the filing of this opinion with the Commission as
an exhibit to the Registration Statement. We also consent to the reference to
our firm under the caption "Validity of Securities" in the prospectus which
forms a part of the Registration Statement. In giving this consent, we do not
thereby admit that we are included in the category of persons whose consent is
required under Section 7 of the Act or the rules and regulations of the
Commission.
This opinion is expressed as of the date hereof, and we disclaim any
undertaking to advise you of any subsequent changes in the facts stated or
assumed herein or of any subsequent changes in applicable law.
Very truly yours,
<PAGE> 1
Exhibit 5.2
April 20, 1998
USBANCORP Capital Trust I
c/o USBANCORP, Inc.
Main and Franklin Streets
P.O. Box 430
Johnstown, PA 15907
Re: USBANCORP Capital Trust I
Ladies and Gentlemen:
We have acted as special Delaware counsel for USBANCORP, Inc.,
a Pennsylvania corporation (the "Company") and USBANCORP 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, as filed with the
office of the Secretary of State of the State of Delaware (the "Secretary of
State") on April 15, 1998;
(b) The Trust Agreement of the Trust, dated as of April 15,
1998, among the Company and the trustees named therein;
(c) The Registration Statement (the "Registration Statement")
on Form S-3, including a preliminary prospectus with respect to the Trust (the
"Prospectus"), relating to the Capital Securities of the Trust representing
preferred undivided beneficial interests in the assets of the Trust (each, a
"Capital Security" and collectively, the "Capital Securities"), to be filed by
the Company and the Trust with the Securities and Exchange Commission on or
about April 15, 1998;
(d) A form of Amended and Restated Trust Agreement of the
Trust, to be entered into between the Company, the trustees of the Trust named
therein, and the holders, from
<PAGE> 2
USBANCORP, Inc.
April 20, 1998
Page 2
time to time, of the undivided beneficial interests in the assets of the Trust
(including Exhibits C and D thereto) (the "Trust Agreement"), attached as an
exhibit to the Registration Statement; and
(e) A Certificate of Good Standing for the Trust, dated April
20, 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 in paragraphs (a) through (e) above.
In particular, we have not reviewed any document (other than the documents
listed in paragraphs (a) through (e) above) that is referred to in or
incorporated by reference into the documents reviewed by us. We have assumed
that there exists no provision in any document that we have not reviewed that is
inconsistent with the opinions stated herein. We have conducted no independent
factual investigation of our own but rather have relied solely upon the
foregoing documents, the statements and information set forth therein and the
additional matters recited or assumed herein, all of which we have assumed to be
true, complete and accurate in all material respects.
With respect to all documents examined by us, we have assumed
(i) the authenticity of all documents submitted to us as authentic originals,
(ii) the conformity with the originals of all documents submitted to us as
copies or forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the
Trust Agreement will constitute 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 applicable Trust, and that the Trust
Agreement and the Certificate of Trust will be in full force and effect and will
not be amended, (ii) except to the extent provided in paragraph 1 below, the 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 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 be issued by the Trust (collectively, the "Capital Security
Holders") of a Capital Security Certificate for such Capital Security and the
payment for such Capital Security, in accordance with the Trust Agreement and
the Registration Statement, and (vii) that the Capital Securities are
authenticated, issued and sold to the Capital Security Holders in accordance
with the Trust Agreement and the Registration Statement. We
<PAGE> 3
USBANCORP, Inc.
April 20, 1998
Page 3
have not participated in the preparation of the Registration Statement or the
Prospectus and assume no responsibility for their 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.
2. The Capital Securities of the Trust will represent valid
and, subject to the qualifications set forth in paragraph 3 below, fully paid
and nonassessable 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
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.
We consent to the filing of this opinion with the Securities
and Exchange Commission as an exhibit to the Registration Statement. 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
Securities and Exchange Commission thereunder. Except as stated above, without
our prior written consent, this opinion may not be furnished or quoted to, or
relied upon by, any other person for any purpose.
Very truly yours,
/s/ Richards, Layton & Finger
EAM/CDR
<PAGE> 1
EXHIBIT 8
April ____, 1998
CIBC Oppenheimer
Legg Mason Wood Walker, Incorporated
c/o CIBC Oppenheimer
CIBC Oppenheimer Tower
One World Financial Center
New York, New York 10281
Re: Series A ____% Capital Securities of
USBANCORP Capital Trust I
Ladies and Gentlemen:
We have acted as tax counsel for USBANCORP, Inc., a Pennsylvania
corporation (the "Company"), and USBANCORP Capital Trust I, a statutory business
trust organized under the Business Trust Act of the State of Delaware (12 Del.
Code Ann., tit. 12, Sections 3801, et seq.) (the "Trust" and, together
with the Company, the "Offerors"), in connection with the sale pursuant to an
Underwriting Agreement dated ________, 1998, among the Company, the Trust and
the purchasers (the "Purchasers") named therein (the "Underwriting Agreement"),
of 1,200,000 shares of Series A ____% Capital Securities (liquidation amount $25
per capital security) of the Trust (the "Series A Capital Securities"),
representing undivided beneficial interests in the assets of the Trust.
The Series A Capital Securities are guaranteed (the "Series A Capital
Securities Guarantee") by the Company with respect to distributions and payments
upon liquidation, redemption, and otherwise pursuant to the Series A Capital
Securities Guarantee Agreement, dated as of ________, 1998 (the "Series A
Capital Securities Guarantee Agreement"), between the
<PAGE> 2
CIBC Oppenheimer
Legg Mason Wood Walker, Incorporated
c/o CIBC Oppenheimer
________, 1998
Page 2
Company and The Bank of New York, as Guarantee Trustee, for the benefit of the
holders of the Series A Capital Securities.
In connection with the issuance of the Series A Capital Securities, the
Trust is also issuing 37,114 shares of its common securities (liquidation amount
of $25 per common security) (the "Common Securities"), representing undivided
beneficial interests in the assets of the Trust.
The entire proceeds from the sale of the Series A Capital Securities
and the Common Securities are to be used by the Trust to purchase an aggregate
principal amount of $30,927,850 of Series A ____% Junior Subordinated Deferrable
Interest Debentures due June 30, 2028 (the "Series A Subordinated Debentures"),
to be issued by the Company. The Series A Capital Securities and the Common
Securities are to be issued pursuant to the Amended and Restated Trust Agreement
dated as of April 15, 1998 (the "Trust Agreement"), among the Company, as
sponsor, The Bank of New York (Delaware), as Delaware trustee (the "Delaware
Trustee"), The Bank of New York, as property trustee (the "Property Trustee"),
and Terry K. Dunkle, Jeffrey A. Stopko and Anthony M. V. Eramo as administrative
trustees. The Series A Subordinated Debentures are to be issued pursuant to an
indenture, to be dated as of April 1, 1998 (the "Indenture"), between the
Company and The Bank of New York, as Debenture Trustee.
<PAGE> 3
CIBC Oppenheimer
Legg Mason Wood Walker, Incorporated
c/o CIBC Oppenheimer
________, 1998
Page 3
Capitalized terms used but not otherwise defined herein shall have the
respective meanings set forth in the Underwriting Agreement.
You have requested our opinion that (a) the Trust will be classified as
a grantor trust and not as an association taxable as a corporation for United
States federal income tax purposes, and (b) the Series A Subordinated Debentures
will be treated as indebtedness for United States federal income tax purposes.
In connection with this opinion, we have reviewed originals or copies, certified
or otherwise identified to our satisfaction, of: (i) the Prospectus; (ii) the
Certificate of Trust filed by the Property Trustee and the Delaware Trustee with
the Secretary of State of the State of Delaware as of ________, 1998; (iii) an
executed copy of the Trust Agreement, including the designation of the terms of
the Series A Capital Securities; (iv) the form of Series A Capital Securities
and a specimen certificate thereof; (v) an executed copy of the Series A Capital
Securities Guarantee Agreement; (vi) an executed copy of the Indenture; (vii)
the form of Series A Subordinated Debentures and a specimen certificate thereof;
(viii) the form of Common Securities and a specimen certificate thereof; (ix) an
executed copy of the Purchase Agreement; and (x) representations set forth in a
certificate from an officer of the Company dated ________, 1998.
In our review, we have assumed the legal capacity of all natural
persons, the genuineness of all signatures, the authenticity of all documents
submitted to us as originals, the
<PAGE> 4
CIBC Oppenheimer
Legg Mason Wood Walker, Incorporated
c/o CIBC Oppenheimer
________, 1998
Page 4
conformity to original documents of all documents submitted to us as certified,
conformed or photostatic copies, and the authenticity of the originals of such
latter documents. In making our review of documents executed, or to be executed
by parties other than the Trust, we have assumed that such parties had, or will
have, the power, corporate or other, to enter into and perform all obligations
thereunder and have also assumed the due authorization by all requisite action,
corporate or other, and execution and delivery by such parties of such documents
and that such documents constitute, or will constitute, valid and binding
obligations of such parties. As to any facts material to the opinions expressed
herein which were not independently established or verified, we have relied upon
oral or written statements and representations of officers, trustees and other
representatives of the Company, the Trust and others. Our opinion is conditioned
on, among other things, the initial and continuing accuracy of the facts,
assumptions, information, covenants, and representations set forth in the
documents referred to above and the statements and representations made by the
Company and the Trust and others referenced above.
In providing our opinion, we have considered the provisions of the
Internal Revenue Code of 1986, as amended, Treasury regulations (proposed,
temporary and final) promulgated thereunder, judicial decisions and Internal
Revenue Service rulings, all as of the date hereof, and all of which are subject
to change, which changes may be retroactively applied. A change in the
authorities upon which our opinion is based could affect
<PAGE> 5
CIBC Oppenheimer
Legg Mason Wood Walker, Incorporated
c/o CIBC Oppenheimer
________, 1998
Page 5
our conclusions. Moreover, there can be no assurance that the Internal Revenue
Service will not challenge the opinions expressed herein or that a court would
not sustain such a challenge. Nevertheless, we are of the view that, if
challenged, the opinions expressed herein would be sustained by a court with
jurisdiction in a properly presented case.
Based solely upon the foregoing and upon the assumptions set forth
herein, and subject to the qualifications and caveats set forth herein, we are
of the opinion that, under present law, for United States federal income tax
purposes:
1. The Trust will be classified as a grantor trust and not as an
association taxable as a corporation. Accordingly, for United
States federal income tax purposes, each holder of Series A
Capital Securities will generally be considered the owner of
an undivided interest in the Series A Subordinated Debentures;
2. Subject to the discussion set forth below under the
heading "SERIES A SUBORDINATED DEBENTURES," the
Series A Subordinated Debentures will be classified as
indebtedness for United States federal income tax
purposes; and
3. Although the discussion set forth in the Prospectus
under the heading "CERTAIN FEDERAL INCOME TAX
CONSEQUENCES" does not purport to discuss all possible
<PAGE> 6
CIBC Oppenheimer
Legg Mason Wood Walker, Incorporated
c/o CIBC Oppenheimer
________, 1998
Page 6
United States federal income tax consequences of the
purchase, ownership, and disposition of the Series A
Capital Securities, in our opinion such discussion
constitutes, in all material respects, a fair and accurate
summary of the relevant United States federal income tax
consequences of the purchase, ownership, and disposition of
Series A Capital Securities under
current law.
----------------------------------------
SERIES A SUBORDINATED DEBENTURES
Generally, the characterization of an instrument as debt or equity for
United States federal income tax purposes depends on all the facts and
circumstances surrounding the issuance and operation of a particular instrument,
and no single factor or characteristic is considered to be controlling. See,
e.g., John Kelley Co. v. Commissioner, 326 U.S. 521 (1946). The taxpayer has the
burden of proving that a particular instrument is debt or equity. See White v.
United States, 305 U.S. 281, 292 (1938); Smith v. Commissioner, 370 F.2d 178,
180 (6th Cir. 1966).
In determining whether a particular instrument evidences a
debtor-creditor or equity relationship, different courts have identified a
number of factors that must be evaluated and have weighed the relative
importance of such factors in light of the particular facts and circumstances of
the instrument under examination. See Fin Hay Realty Co. v. United States, 398
F.2d
<PAGE> 7
CIBC Oppenheimer
Legg Mason Wood Walker, Incorporated
c/o CIBC Oppenheimer
________, 1998
Page 7
694, 696 (3d Cir. 1968); Tyler v. Tomlinson, 414 F.2d 844, 848 (5th Cir. 1969).
In cases where a purported debt instrument is not held proportionately with
shareholding, the factors which appear to be the most important are those that
distinguish the rights and remedies of creditors from those of stockholders.
See, Federal Express Corp. v. United States, 645 F. Supp. 1281 (W.D. Tenn.
1986). In such cases, the most relevant factors are (i) a definite maturity date
and certainty of payment, (ii) the ability to force repayment in the event of a
default, (iii) subordination, (iv) adequacy and unconditionality with respect to
the payment of interest, (v) participation in the success of the issuer's
business, and (vi) participation in the management of the issuer. See
Scriptomatic, Inc. v. United States, 555 F.2d 364 (3d Cir. 1977); Federal
Express, supra, at 1290-91.
Based on the factors identified above, the following features of the
Series A Subordinated Debentures (hereinafter, the "SASD") are the most relevant
to the determination of whether they should be classified as indebtedness of the
Company:
1. Term. The term of the SASD is approximately thirty
(30) years, and the SASD are payable in cash upon
maturity.
2. Interest. The Company is obligated to pay interest on the SASD
without regard to the Company's earnings; and, while the
Company has the right at any time during the term of the SASD
to defer payment of interest on the SASD for up to twenty (20)
consecutive quarterly interest payment periods (each an
"Extension Period"), this interest payment deferral option
(the "Deferral
<PAGE> 8
CIBC Oppenheimer
Legg Mason Wood Walker, Incorporated
c/o CIBC Oppenheimer
________, 1998
Page 8
Option") is clearly limited and the Trustees of the Trust can
sue to compel payment of the amounts then due if the Company
exceeds the scope of the Deferral Option. In addition,
interest will compound quarterly at the coupon rate
("Additional Interest") on any deferred interest to the extent
permitted by law.
3. Default. Any default in the payment of interest (other
than a deferral permitted pursuant to the Deferral
Option) or other amounts results in a legally
enforceable right of Trustees of the Trust against the
Company to accelerate the SASD and obtain full payment.
4. Subordination. The SASD are subordinate and junior in
right of payment to all Senior Debt to the extent
provided in the Indenture, but are pari passu with the
general unsecured creditors of the Company and senior
to all classes of equity of the Company.
5. Management. Neither the Trust nor the holders of the
Series A Capital Securities (the "Holders") are entitled to
vote or otherwise participate in the management of the
Company.
6. Non-Tax Characterization. The SASD, the Trust and the
Series A Capital Securities are designed to enable the
Company to receive more favorable treatment for its
senior debt than it would receive if the Company issued
senior debt to the public rather than issuing the SASD
to the Trust. In addition, for accounting purposes,
the Series A Capital Securities and the SASD are
expected to be reflected in the Company's consolidated
financial statements as "Guaranteed Preferred
Beneficial Interests in Corporation's Junior
Subordinated Deferrable Interest Debentures, Series A."
The Trust, the Company and the Holders will, however,
treat the SASD as indebtedness of the Company for all
purposes related to United States federal income
taxation.
<PAGE> 9
CIBC Oppenheimer
Legg Mason Wood Walker, Incorporated
c/o CIBC Oppenheimer
________, 1998
Page 9
The SASD, therefore, have indicia typical of debt, and essentially all
of their attributes are characteristic of debt instruments. Arguably, only to
the extent that (i) a thirty (30) year maturity may be considered unreasonable,
(ii) the Company may receive more favorable treatment for its senior debt from
independent credit rating agencies and regulatory authorities than it would
receive if the Company instead issued senior debt to the public, and (iii)
interest may be deferred pursuant to the Deferral Option, could the SASD be seen
as having any material equity-like characteristics. As discussed below, these
features of the SASD either should not constitute equity-like characteristics,
or they should not undermine the classification of the SASD as indebtedness of
the Company.
A. The Term.
No particular period constitutes a per se reasonable maturity
date in all situations. The line between debt and equity is not determined
solely by the term of the instrument. Instruments with maturities ranging from
50 to 99 years have been found to qualify as debt when the borrower's business
is expected to continue for that period or there is a contractual obligation
that is reasonably likely to be satisfied on or prior to a definite date. See
Monon Railroad v. Commissioner, 55 T.C. 345, 359 (1970) (50 year debt); Ruspyn
Corporation v. Commissioner, 18 T.C. 769 (1952) (89 year debt); Mayerson v.
Commissioner, 47 T.C. 340 (1966) (99 year debt). In contrast, if the term of the
instrument is expected to extend beyond the expected life of an
<PAGE> 10
CIBC Oppenheimer
Legg Mason Wood Walker, Incorporated
c/o CIBC Oppenheimer
________, 1998
Page 10
issuer's assets, equity classification is more likely. See Swoby Corporation v.
Commissioner, 9 T.C. 887, 894 (1947) (99 year instrument not debt).
The term of the SASD will be approximately thirty (30) years.
This term should be viewed as a reasonable maturity for the Company, inasmuch as
the Company has a sound credit rating for the Series A Capital Securities, as
evidenced by the "BBB-" investment grade rating assigned to the Series A Capital
Securities by Thomson Bank Watch, and the Company expects, and has represented
to us that it expects, to have future cash flow or access to financing
sufficient to support the payments that will become due on the SASD. Moreover,
in the unlikely event that a thirty (30) year term is considered excessive for
the Company, the term is but one factor leaning towards equity characterization,
and this factor should be outweighed by other factors inherent in the SASD that
are indicative of debt classification.
B. Non-Tax Characterization.
The Internal Revenue Service has taken the position that the
characterization of an instrument for non-tax purposes, including accounting,
regulatory or rating agency purposes, is a relevant factor in classifying an
instrument as debt or equity. Notice 94-47, 1994-19 I.R.B. 9 (May 9, 1994).
Courts, however, have placed less importance on the treatment of an instrument
for non-tax purposes and have stated that such treatment is, at most,
<PAGE> 11
CIBC Oppenheimer
Legg Mason Wood Walker, Incorporated
c/o CIBC Oppenheimer
________, 1998
Page 11
one factor to consider and is certainly not controlling for United States
federal income tax purposes. See, e.g., Cottage Savings Association v.
Commissioner, 499 U.S. 554 (1991); Thor Power Tool Co. v. Commissioner, 439 U.S.
522, 538-44 (1979).
The SASD, the Trust and the Series A Capital Securities are
designed to enable the Company to receive more favorable treatment for its
senior debt than it would receive if the Company had issued additional senior
debt to the public rather than issuing the SASD to the Trust. For example, it is
our understanding that the funds received through the issuance of the Series A
capital Securities will, generally, constitute "Tier 1 Capital" for bank holding
companies subject to regulation by the Federal Reserve. In addition, for
financial accounting purposes, the Series A Capital Securities and the SASD are
expected to be reflected in the Company's consolidated financial statements as
"Guaranteed Preferred Beneficial Interests in Corporation's Junior Subordinated
Deferrable Interest Debentures, Series A." Such categorization will, however,
still cause the Series A Capital Securities to constitute a liability of the
Company for financial accounting purposes.
Under the view espoused by the Internal Revenue Service, these non-tax
characteristics of the SASD may be viewed as equity-like features of the SASD.
Nevertheless, the Internal Revenue Service does not treat this factor as
conclusive, but rather treats it as one of the many factors that must be weighed
in reaching a determination. In addition, it is unclear whether
<PAGE> 12
CIBC Oppenheimer
Legg Mason Wood Walker, Incorporated
c/o CIBC Oppenheimer
________, 1998
Page 12
the courts would place any material weight on the treatment of the SASD for
these non-tax purposes. Moreover, the treatment of the SASD for accounting,
regulatory and credit rating agency purposes does not affect the Company's
obligations under the SASD, or the Company's ability to meet it's principal and
interest obligations on the SASD or undermine the creditor rights inherent in
the SASD. Therefore, the characterization of the SASD by regulatory authorities
and independent credit rating agencies, and their status for financial
accounting and regulatory purposes, should not jeopardize their status as
indebtedness of the Company. At worst, such non-tax characterizations could be
viewed as relatively minor equity-like features of the SASD that should not
jeopardize their status as indebtedness of the Company.
C. Interest Deferral Option.
The ability to forego making periodic payments provided for
under the terms of an instrument, such as the Deferral Option, may also be
viewed as an equity-like feature. Nevertheless, and even though the Deferral
Option is a valuable rights to the Company, the mere ability to defer interest
on the SASD should not have a material effect on the classification of the SASD
as debt, since (i) interest will compound quarterly at the coupon rate on any
deferred interest to the extent permitted by law, and (ii) exercise of the
Deferral Option only converts the SASD into a partial zero coupon bond with the
same yield to maturity. Moreover, the Deferral Option does not undermine the
<PAGE> 13
CIBC Oppenheimer
Legg Mason Wood Walker, Incorporated
c/o CIBC Oppenheimer
________, 1998
Page 13
Trust's right to enforce the payment of principal and interest on schedule,
since the Deferral Option is, in effect, part of the interest payment schedule.
Therefore, the Deferral Option should not have an adverse impact on the
classification of the SASD as indebtedness of the Company.
D. Conclusion.
Although the issue is not entirely free from doubt, based on
all of the foregoing and assuming that the "BBB-" investment grade rating of the
Series A Capital Securities by Thomson Bank Watch is persuasive evidence that
(i) the Company, as borrower, is adequately capitalized, and (ii) there is a
reasonable expectation that the Company will be able to service the SASD and
make all payments of principal and interest as and when due under the terms of
the SASD, and subject to all other assumptions, qualifications and caveats set
forth herein, we are of the opinion that, under present law, the SASD will be
classified as indebtedness of the Company for United States federal income tax
purposes.
----------------------------------------
Except as set forth above, we express no opinion to any party as to the
tax consequences, whether federal, state, local or foreign, of the issuance of
the Series A Subordinated Debentures, the Series A Capital Securities, the
Common Securities or any transactions related to or contemplated by such
<PAGE> 14
CIBC Oppenheimer
Legg Mason Wood Walker, Incorporated
c/o CIBC Oppenheimer
________, 1998
Page 14
issuance. This opinion may not be relied upon by any party other than the
addressees hereof.
The opinion is expressed as of the date hereof unless otherwise
expressly stated, and we disclaim any undertaking to advise you of changes of
the facts stated or assumed herein or any subsequent changes in applicable law.
Very truly yours,
<PAGE> 1
Exhibit 12.1
COMPUTATION OF RATIO OF FIXED CHARGES
EXCLUDING INTEREST ON DEPOSITS
<TABLE>
<CAPTION>
1997
<S> <C>
NET INCOME 23,497
EXTRAORDINARY ITEM
FASB 109 BENEFIT 0
PROVISION FOR INCOME TAXES 9,303
------
PRE TAX INCOME 32,800
FIXED CHARGES:
INTEREST EXPENSE ON:
PREFERRED STOCK DIVIDEND FACTOR* 0
FED FUNDS PURCH AND SEC
SOLD UNDER AGREE TO REPURCH 5,060
SHORT TERM BORROWINGS 3,123
ADVANCES FROM FHLB 36,648
CMO 415
INT EXP ON L/T DEBT AND CAP LEASES 111
APPROPRIATE PORTION
OF RENTAL EXP (25%) 195
------
TOTAL FIXED CHARGES 45,552
EARNINGS BEFORE INCOME TAXES AND FIXED CHAR 78,352
RATIO OF EARNINGS TO FIXED CHARGES 1.72
</TABLE>
<PAGE> 1
Exhibit 23.1
[ARTHUR ANDERSEN LLP LETTERHEAD]
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement on Form S-3 of our report dated
January 23, 1998 included in USBANCORP, Inc.'s Form 10-K for the year ended
December 31, 1997 and to all references to our Firm included in this
registration statement.
/s/ Arthur Andersen LLP
---------------------------------
ARTHUR ANDERSEN LLP
Pittsburgh, Pennsylvania,
April 22, 1998
<PAGE> 1
EXHIBIT 25.1
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) |__|
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
USBANCORP CAPITAL TRUST I
(Exact name of obligor as specified in its charter)
Delaware Applied For
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
400 White Clay Center, Route 273
Newark, Delaware 19711
(Address of principal executive offices) (Zip code)
Capital Securities
(Title of the indenture securities)
<PAGE> 2
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
- --------------------------------------------------------------------------------
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION,
ARE INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO
RULE 7a-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17
C.F.R. 229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which
contains the authority to commence business and a grant of
powers to exercise corporate trust powers. (Exhibit 1 to
Amendment No. 1 to Form T-1 filed with Registration Statement
No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with
Registration Statement No. 33-21672 and Exhibit 1 to Form T-1
filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to
Form T-1 filed with Registration Statement No. 33-31019.)
-2-
<PAGE> 3
6. The consent of the Trustee required by Section 321(b) of the
Act. (Exhibit 6 to Form T-1 filed with Registration Statement
No. 33-44051.)
7. A copy of the latest report of condition of the Trustee
published pursuant to law or to the requirements of its
supervising or examining authority.
-3-
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, 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 13th day of April, 1998.
THE BANK OF NEW YORK
By: /s/THOMAS B. ZAKRZEWSKI
-------------------------------
Name: THOMAS B. ZAKRZEWSKI
Title: ASSISTANT VICE PRESIDENT
-4-
<PAGE> 5
Exhibit 7
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries, a member of the Federal Reserve
System, at the close of business September 30, 1997, published in accordance
with a call made by the Federal Reserve Bank of this District pursuant to the
provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
ASSETS in Thousands
------------
<S> <C>
Cash and balances due from depos-
itory institutions:
Noninterest-bearing balances and
currency and coin ................................... $ 5,004,638
Interest-bearing balances ........................... 1,271,514
Securities:
Held-to-maturity securities ......................... 1,105,782
Available-for-sale securities ....................... 3,164,271
Federal funds sold and Securities pur-
chased under agreements to resell ................... 5,723,829
Loans and lease financing
receivables:
Loans and leases, net of unearned
income .................34,916,196
LESS: Allowance for loan and
lease losses ..............581,177
LESS: Allocated transfer risk
reserve........................429
Loans and leases, net of unearned
income, allowance, and reserve .................... 34,334,590
Assets held in trading accounts ....................... 2,035,284
Premises and fixed assets (including
capitalized leases) ................................. 671,664
Other real estate owned ............................... 13,306
Investments in unconsolidated
subsidiaries and associated
companies ........................................... 210,685
Customers' liability to this bank on
acceptances outstanding ............................. 1,463,446
Intangible assets ..................................... 753,190
Other assets .......................................... 1,784,796
------------
Total assets .......................................... $ 57,536,995
============
LIABILITIES
Deposits:
In domestic offices ................................. $ 27,270,824
Noninterest-bearing ......12,160,977
Interest-bearing .........15,109,847
In foreign offices, Edge and
Agreement subsidiaries, and IBFs .................... 14,687,806
Noninterest-bearing .........657,479
Interest-bearing .........14,030,327
Federal funds purchased and Securities
sold under agreements to repurchase ................. 1,946,099
Demand notes issued to the U.S. .......................
Treasury ............................................ 283,793
Trading liabilities ................................... 1,553,539
Other borrowed money:
With remaining maturity of one year
or less ........................................... 2,245,014
With remaining maturity of more than
one year through three years ...................... 0
With remaining maturity of more than
three years ....................................... 45,664
Bank's liability on acceptances exe-
cuted and outstanding ............................... 1,473,588
Subordinated notes and debentures ..................... 1,018,940
Other liabilities ..................................... 2,193,031
------------
Total liabilities ..................................... 52,718,298
------------
EQUITY CAPITAL
Common stock .......................................... 1,135,284
Surplus ............................................... 731,319
Undivided profits and capital
reserves ............................................ 2,943,008
Net unrealized holding gains
(losses) on available-for-sale
securities .......................................... 25,428
Cumulative foreign currency transla-
tion adjustments .................................... (16,342)
------------
Total equity capital .................................. 4,818,697
------------
Total liabilities and equity
capital ............................................. $ 57,536,995
============
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this Report
of Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
J. Carter Bacot
Thomas A. Renyi Directors
Alan R. Griffith
<PAGE> 1
EXHIBIT 25.2
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) |__|
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
USBANCORP, INC.
(Exact name of obligor as specified in its charter)
Pennsylvania 25-1424278
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
Main and Franklin Streets
Johnstown, Pennsylvania 15907
(Address of principal executive offices) (Zip code)
Junior Subordinated Deferrable Interest Debentures
(Title of the indenture securities)
<PAGE> 2
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
- --------------------------------------------------------------------------------
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION,
ARE INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO
RULE 7a-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17
C.F.R. 229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which
contains the authority to commence business and a grant of
powers to exercise corporate trust powers. (Exhibit 1 to
Amendment No. 1 to Form T-1 filed with Registration Statement
No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with
Registration Statement No. 33-21672 and Exhibit 1 to Form T-1
filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to
Form T-1 filed with Registration Statement No. 33-31019.)
-2-
<PAGE> 3
6. The consent of the Trustee required by Section 321(b) of the
Act. (Exhibit 6 to Form T-1 filed with Registration Statement
No. 33-44051.)
7. A copy of the latest report of condition of the Trustee
published pursuant to law or to the requirements of its
supervising or examining authority.
-3-
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, 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 13th day of April, 1998.
THE BANK OF NEW YORK
By: /s/THOMAS B. ZAKRZEWSKI
-------------------------------
Name: THOMAS B. ZAKRZEWSKI
Title: ASSISTANT VICE PRESIDENT
-4-
<PAGE> 5
Exhibit 7
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries, a member of the Federal Reserve
System, at the close of business September 30, 1997, published in accordance
with a call made by the Federal Reserve Bank of this District pursuant to the
provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
ASSETS in Thousands
------------
<S> <C>
Cash and balances due from depos-
itory institutions:
Noninterest-bearing balances and
currency and coin ................................... $ 5,004,638
Interest-bearing balances ........................... 1,271,514
Securities:
Held-to-maturity securities ......................... 1,105,782
Available-for-sale securities ....................... 3,164,271
Federal funds sold and Securities pur-
chased under agreements to resell ................... 5,723,829
Loans and lease financing
receivables:
Loans and leases, net of unearned
income .................34,916,196
LESS: Allowance for loan and
lease losses ..............581,177
LESS: Allocated transfer risk
reserve........................429
Loans and leases, net of unearned
income, allowance, and reserve .................... 34,334,590
Assets held in trading accounts ....................... 2,035,284
Premises and fixed assets (including
capitalized leases) ................................. 671,664
Other real estate owned ............................... 13,306
Investments in unconsolidated
subsidiaries and associated
companies ........................................... 210,685
Customers' liability to this bank on
acceptances outstanding ............................. 1,463,446
Intangible assets ..................................... 753,190
Other assets .......................................... 1,784,796
------------
Total assets .......................................... $ 57,536,995
============
LIABILITIES
Deposits:
In domestic offices ................................. $ 27,270,824
Noninterest-bearing ......12,160,977
Interest-bearing .........15,109,847
In foreign offices, Edge and
Agreement subsidiaries, and IBFs .................... 14,687,806
Noninterest-bearing .........657,479
Interest-bearing .........14,030,327
Federal funds purchased and Securities
sold under agreements to repurchase ................. 1,946,099
Demand notes issued to the U.S. .......................
Treasury ............................................ 283,793
Trading liabilities ................................... 1,553,539
Other borrowed money:
With remaining maturity of one year
or less ........................................... 2,245,014
With remaining maturity of more than
one year through three years ...................... 0
With remaining maturity of more than
three years ....................................... 45,664
Bank's liability on acceptances exe-
cuted and outstanding ............................... 1,473,588
Subordinated notes and debentures ..................... 1,018,940
Other liabilities ..................................... 2,193,031
------------
Total liabilities ..................................... 52,718,298
------------
EQUITY CAPITAL
Common stock .......................................... 1,135,284
Surplus ............................................... 731,319
Undivided profits and capital
reserves ............................................ 2,943,008
Net unrealized holding gains
(losses) on available-for-sale
securities .......................................... 25,428
Cumulative foreign currency transla-
tion adjustments .................................... (16,342)
------------
Total equity capital .................................. 4,818,697
------------
Total liabilities and equity
capital ............................................. $ 57,536,995
============
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this Report
of Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
J. Carter Bacot
Thomas A. Renyi Directors
Alan R. Griffith
<PAGE> 1
EXHIBIT 25.3
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) |__|
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
USBANCORP, INC.
(Exact name of obligor as specified in its charter)
Pennsylvania 25-1424278
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
Main and Franklin Streets
Johnstown, Pennsylvania 15907
(Address of principal executive offices) (Zip code)
Guarantee with respect to Capital Securities
of USBANCORP Capital Trust I
(Title of the indenture securities)
<PAGE> 2
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
- --------------------------------------------------------------------------------
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION,
ARE INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO
RULE 7a-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17
C.F.R. 229.10(d).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which
contains the authority to commence business and a grant of
powers to exercise corporate trust powers. (Exhibit 1 to
Amendment No. 1 to Form T-1 filed with Registration Statement
No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with
Registration Statement No. 33-21672 and Exhibit 1 to Form T-1
filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to
Form T-1 filed with Registration Statement No. 33-31019.)
-2-
<PAGE> 3
6. The consent of the Trustee required by Section 321(b) of the
Act. (Exhibit 6 to Form T-1 filed with Registration Statement
No. 33-44051.)
7. A copy of the latest report of condition of the Trustee
published pursuant to law or to the requirements of its
supervising or examining authority.
-3-
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, 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 13th day of April, 1998.
THE BANK OF NEW YORK
By: /s/THOMAS B. ZAKRZEWSKI
-------------------------------
Name: THOMAS B. ZAKRZEWSKI
Title: ASSISTANT VICE PRESIDENT
-4-
<PAGE> 5
Exhibit 7
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries, a member of the Federal Reserve
System, at the close of business September 30, 1997, published in accordance
with a call made by the Federal Reserve Bank of this District pursuant to the
provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
ASSETS in Thousands
------------
<S> <C>
Cash and balances due from depos-
itory institutions:
Noninterest-bearing balances and
currency and coin ................................... $ 5,004,638
Interest-bearing balances ........................... 1,271,514
Securities:
Held-to-maturity securities ......................... 1,105,782
Available-for-sale securities ....................... 3,164,271
Federal funds sold and Securities pur-
chased under agreements to resell ................... 5,723,829
Loans and lease financing
receivables:
Loans and leases, net of unearned
income .................34,916,196
LESS: Allowance for loan and
lease losses ..............581,177
LESS: Allocated transfer risk
reserve........................429
Loans and leases, net of unearned
income, allowance, and reserve .................... 34,334,590
Assets held in trading accounts ....................... 2,035,284
Premises and fixed assets (including
capitalized leases) ................................. 671,664
Other real estate owned ............................... 13,306
Investments in unconsolidated
subsidiaries and associated
companies ........................................... 210,685
Customers' liability to this bank on
acceptances outstanding ............................. 1,463,446
Intangible assets ..................................... 753,190
Other assets .......................................... 1,784,796
------------
Total assets .......................................... $ 57,536,995
============
LIABILITIES
Deposits:
In domestic offices ................................. $ 27,270,824
Noninterest-bearing ......12,160,977
Interest-bearing .........15,109,847
In foreign offices, Edge and
Agreement subsidiaries, and IBFs .................... 14,687,806
Noninterest-bearing .........657,479
Interest-bearing .........14,030,327
Federal funds purchased and Securities
sold under agreements to repurchase ................. 1,946,099
Demand notes issued to the U.S. .......................
Treasury ............................................ 283,793
Trading liabilities ................................... 1,553,539
Other borrowed money:
With remaining maturity of one year
or less ........................................... 2,245,014
With remaining maturity of more than
one year through three years ...................... 0
With remaining maturity of more than
three years ....................................... 45,664
Bank's liability on acceptances exe-
cuted and outstanding ............................... 1,473,588
Subordinated notes and debentures ..................... 1,018,940
Other liabilities ..................................... 2,193,031
------------
Total liabilities ..................................... 52,718,298
------------
EQUITY CAPITAL
Common stock .......................................... 1,135,284
Surplus ............................................... 731,319
Undivided profits and capital
reserves ............................................ 2,943,008
Net unrealized holding gains
(losses) on available-for-sale
securities .......................................... 25,428
Cumulative foreign currency transla-
tion adjustments .................................... (16,342)
------------
Total equity capital .................................. 4,818,697
------------
Total liabilities and equity
capital ............................................. $ 57,536,995
============
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this Report
of Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
J. Carter Bacot
Thomas A. Renyi Directors
Alan R. Griffith
