SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------------------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
November 27, 1996
<TABLE>
<CAPTION>
<S> <C>
NATIONSBANK CORPORATION NB CAPITAL TRUST I
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS (EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS
CHARTER) CHARTER)
NORTH CAROLINA DELAWARE
(STATE OR OTHER JURISDICTION OF INCORPORATION OR (STATE OR OTHER JURISDICTION OF INCORPORATION OR
ORGANIZATION) ORGANIZATION)
1-6523 1-6523-01
(COMMISSION FILE NUMBER) (COMMISSION FILE NUMBER)
56-0906609 56-6490299
(IRS EMPLOYER IDENTIFICATION NO.) (IRS EMPLOYER IDENTIFICATION NO.)
NATIONSBANK CORPORATE CENTER C/O NATIONSBANK CORPORATE CENTER
CHARLOTTE, NORTH CAROLINA CHARLOTTE, NORTH CAROLINA
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
28255 28255
(ZIP CODE) (ZIP CODE)
(704) 386-5000 (704) 386-5972
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA (REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA
CODE) CODE)
</TABLE>
<PAGE>
ITEM 5. OTHER EVENTS.
For a transaction effective November 27, 1996, the Trustees (the
"Trustees") of NB Capital Trust I (the "Trust") approved the public offering of
24,000,000 of the Trust's 7.84% Trust Originated Preferred Securities having an
aggregate initial offering price of $600,000,000 (the "Preferred Securities") to
various underwriters (the "Underwriters") and otherwise established the terms
and conditions of the Preferred Securities. The Trust also granted the
Underwriters an over-allotment option (the "Over-allotment Option") to purchase
up to an additional 3,600,000 Preferred Securities having an aggregate initial
offering price of $90,000,000. In connection with the offering of the Preferred
Securities, the Trustees also approved the sale of the Trust's Common Securities
(the "Common Securities") to NationsBank Corporation ("NationsBank") and
otherwise established the terms and conditions of the Common Securities. Also
for a transaction effective November 27, 1996, the Trustees authorized the
investment of the proceeds from the sale of the Preferred Securities and the
Common Securities in the 7.84% Junior Subordinated Deferrable Interest Notes,
due 2026 of NationsBank (the "Junior Notes"). The resolutions of the Trustees
are included as Exhibit 99.1 hereto.
By written consent dated November 27, 1996, a Committee appointed by
the Board of Directors of NationsBank approved the sale to the Trust of a series
of the Junior Notes having an aggregate principal amount of up to $711,350,000
and otherwise established the terms and conditions of the Junior Notes.
Resolutions of such Committee are included as Exhibit 99.2 hereto.
The terms of the offering, the Preferred Securities, the Common
Securities and the Junior Notes are described in the Registrants' Prospectus
dated November 27, 1996 constituting a part of the Registration Statement
(hereinafter described), as supplemented by a Prospectus Supplement dated
November 27, 1996. The Underwriting Agreement is included as Exhibit 1.1 hereto.
The Preferred Securities were issued pursuant to the Registrants'
Registration Statement on Form S-3, Registration Nos. 333-15375 and 333-15375-
03 (the "Registration Statement"), on a delayed basis pursuant to Rule 415 under
the Securities Act of 1933, as amended. The Registration Statement registered up
to $1,000,000,000 aggregate initial price of NationsBank junior subordinated
notes and up to $1,000,000,000 aggregate initial offering price of preferred
securities of NB Capital Trust I, NB Capital Trust II and NB Capital Trust III
together with related guarantees of such preferred securities by NationsBank.
The Registration Statement was declared effective on November 27, 1996, and
the offering was closed on December 4, 1996.
2
<PAGE>
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits.
The following exhibits are filed herewith:
EXHIBIT NO. DESCRIPTION OF EXHIBIT
1.1 Underwriting Agreement dated November 27, 1996 with
respect to the offering of the Preferred Securities
4.1 Form of Preferred Securities
4.2 Form of Junior Note (included in Exhibit 4.3)
4.3 Supplemental Indenture to be used in connection with the
issuance of Junior Notes and Preferred Securities
99.1 Resolutions of the Trustees of NB Capital Trust I dated
November 27, 1996 with respect to the terms of the
offering of the Preferred Securities
99.2 Resolutions of a Committee appointed by the Board of
Directors of NationsBank Corporation dated November
27, 1996 with respect to the Junior Notes
99.3 News Release disseminated on November 27, 1996
regarding the sale of the Preferred Securities
3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrants have duly caused this report to be signed on their behalf by
the undersigned hereunto duly authorized.
NATIONSBANK CORPORATION
By: /s/ CHARLES M. BERGER
CHARLES M. BERGER
Associate General Counsel
NB CAPITAL TRUST I
By: /s/ JOHN E. MACK
JOHN E. MACK
Regular Trustee
Dated: December 4, 1996
4
<PAGE>
INDEX TO EXHIBITS
Sequential
Exhibit No. Description Page No.
1.1 Underwriting Agreement dated November 27, 1996
with respect to the offering of the Preferred Securities
4.1 Form of Preferred Securities
4.2 Form of Junior Note (included in Exhibit 4.3)
4.3 Supplemental Indenture to be used in connection
with the issuance of Junior Notes and Preferred
Securities
99.1 Resolutions of the Trustees of NB Capital Trust I
dated November 27, 1996 with respect to the
terms of the offering of the Preferred Securities
99.2 Resolutions of a Committee appointed by the
Board of Directors of NationsBank Corporation
dated November 27, 1996 with respect to
the Junior Notes
99.3 News Release disseminated on November 27, 1996
regarding the sale of the Preferred Securities
5
24,000,000 Preferred Securities
NB CAPITAL TRUST I
(a Delaware Trust)
7.84% Trust Originated Preferred Securities (SM)**
(SM) "Trust Originated Preferred Securities" and "TOPrS" are service marks of
Merrill Lynch & Co., Inc. ("TOPrS (SM)")
(Liquidation Amount of $25 per Preferred Security)
UNDERWRITING AGREEMENT
- ---------------
November 27, 1996
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated,
Dean Witter Reynolds Inc.,
A.G. Edwards & Sons, Inc.,
PaineWebber Incorporated,
Prudential Securities Incorporated,
Smith Barney Inc.,
as Representatives of the several Underwriters
c/o Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Merrill Lynch World Headquarters
North Tower
World Financial Center
New York, New York 10281
Dear Sirs:
NB Capital Trust I (the "Trust"), a statutory business trust organized
under the Business Trust Act (the "Delaware Act") of the State of Delaware
(Chapter 38, Title 12, of the Delaware Code, 12 Del. C. (S)(S) 3801 et seq.),
and NationsBank Corporation, a North Carolina corporation (the "Company" and,
together with the Trust, the "Offerors"), confirm their agreement (the
"Agreement") with Merrill Lynch & Co. Inc., Merrill Lynch, Pierce, Fenner &
Smith Incorporated, Dean Witter Reynolds Inc., A.G. Edwards & Sons, Inc.,
PaineWebber Incorporated, Prudential Securities Incorporated , Smith Barney Inc.
and each of the other Underwriters named in Schedule A hereto (collectively, the
"Underwriters," which term shall also include any underwriter substituted as
hereinafter provided in Section 10 hereof), for whom Merrill Lynch & Co. Inc.,
Merrill Lynch, Pierce, Fenner & Smith Incorporated, Dean Witter Reynolds Inc.,
A.G. Edwards & Sons, Inc., PaineWebber Incorporated, Prudential Securities
<PAGE>
Incorporated and Smith Barney Inc. are acting as representatives (in
such capacity, the "Representatives"), with respect to the sale by the Trust and
the purchase by the Underwriters, acting severally and not jointly, of the
respective numbers of 7.84% Trust Originated Preferred Securities (liquidation
amount of $25 per preferred security) of the Trust (the "Initial Preferred
Securities") set forth in said Schedule A. The Company also grants to the
Underwriters, severally and not jointly, the option described in Section 2(c)
(the "Option") to purchase up to 3,600,000 additional 7.84% Trust Originated
Preferred Securities (liquidation amount of $25 per preferred security) of the
Trust (the "Option Preferred Securities" and together with the Initial Preferred
Securities the "Preferred Securities") solely to cover over-allotments. The
Preferred Securities will be guaranteed on a subordinated basis by the Company,
to the extent set forth in the Prospectus (as defined herein), with respect to
distributions and payments upon liquidation, redemption and otherwise (the
"Preferred Securities Guarantee") pursuant to the Preferred Securities Guarantee
Agreement, to be dated as of December 4, 1996, and as may be amended, if
necessary, in connection with an exercise of the Option (the "Preferred
Securities Guarantee Agreement"), between the Company and The Bank of New York,
as trustee (the "Guarantee Trustee"), and will be entitled to the benefits of
certain backup undertakings described in the Prospectus (as defined herein) with
respect to the Company's agreement pursuant to the Supplemental Indenture (as
defined herein) to pay all expenses relating to administration of the Trust
(other than payment obligations with respect to the Preferred Securities). The
Preferred Securities and the related Preferred Securities Guarantees are
referred to herein as the "Securities."
The Offerors have filed with the Securities and Exchange Commission
(the "Commission") a registration statement on Form S-3 (No. 333-15375) and a
related preliminary prospectus for the registration under the Securities Act of
1933, as amended (the "1933 Act") of (i) the Preferred Securities, (ii) the
Preferred Securities Guarantee, and (iii) the Junior Subordinated Notes (as
defined below) to be issued and sold to the Trust by the Company, have filed
such amendments thereto, if any, and such amended preliminary prospectuses as
may have been required to the date hereof, and will file such additional
amendments thereto and such amended prospectuses as may hereafter be required.
Such registration statement (as amended) and the prospectus constituting a part
thereof (including, in each case, all documents incorporated or deemed to be
incorporated by reference therein pursuant to Item 12 of Form S-3 under the 1933
Act and the information, if any, deemed to be part thereof pursuant to Rule
430A(b) of the rules and regulations of the Commission under the 1933 Act (the
"1933 Act Regulations")), as from time to time amended or supplemented pursuant
to the 1933 Act, the Securities Exchange Act of 1934, as amended (the "1934
Act"), or otherwise, are hereinafter referred to as the "Registration Statement"
and the "Prospectus," respectively, except that, if any revised prospectus shall
be provided to the Underwriters by the Offerors for use in connection with the
offering of the Preferred Securities which differs from the Prospectus on file
at the Commission at the time the Registration Statement became effective
(whether or not such revised prospectus is required to be filed by the Offerors
pursuant to Rule 424(b) of the 1933 Act Regulations), the term "Prospectus"
shall refer to such revised prospectus from and after the time it is first
provided to the Underwriters for such use. All references in this Agreement to
financial statements and schedules and other information that is "contained,"
"included" or "stated" in the Registration Statement or the Prospectus (and all
- 2 -
<PAGE>
other references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information that are or are deemed
to be incorporated by reference in the Registration Statement or the Prospectus,
as the case may be; and all references in this Agreement to amendments or
supplements to the Registration Statement or the Prospectus shall be deemed to
mean and include the filing of any document under the 1934 Act that is or is
deemed to be incorporated by reference in the Registration Statement or the
Prospectus, as the case may be.
The Offerors understand that the Underwriters propose to make a public
offering of the Preferred Securities as soon as the Representatives deem
advisable after this Agreement has been executed and delivered and the
Declaration (as defined herein), the Indenture (as defined herein) and the
Preferred Securities Guarantee have been qualified under the Trust Indenture Act
of 1939, as amended (the "1939 Act"). The entire proceeds to the Trust from the
sale of the Preferred Securities will be combined with the entire proceeds from
the sale by the Trust to the Company of its common securities (the "Common
Securities"), as guaranteed on a subordinated basis by the Company, to the
extent set forth in the Prospectus, with respect to distributions and payments
upon liquidation and redemption thereof (the "Common Securities Guarantee" and
together with the Preferred Securities Guarantee, the "Guarantees") pursuant to
the Common Securities Guarantee Agreement, to be dated as of December 4, 1996,
as amended, if necessary, in connection with an exercise of the Option (the
"Common Securities Guarantee Agreement" and, together with the Preferred
Securities Guarantee Agreement, the "Guarantee Agreements"), between the Company
and Guarantee Trustee, as Trustee, and will be used by the Trust to purchase the
$600,000,000 aggregate principal amount of 7.84% Junior Subordinated Deferrable
Interest Notes, due 2026 (the "Junior Subordinated Notes") issued by the Company
(and such additional aggregate principal amount of Junior Subordinated Notes as
may be necessary if the Option is exercised), under the Indenture (as defined
herein). The Preferred Securities and the Common Securities will be issued
pursuant to the amended and restated declaration of trust of the Trust, dated as
of November 27, 1996 (the "Declaration") (as may be further amended, if
necessary, subject to the exercise of the Option), among the Company, as
Sponsor, John E. Mack, William L. Maxwell and Marc D. Oken, as trustees (the
"Regular Trustees"), and The Bank of New York, a Delaware banking corporation,
as property trustee (the "Property Trustee" and, together with the Regular
Trustees, the "Trustees"), and the holders from time to time of undivided
beneficial interests in the assets of the Trust. The Junior Subordinated Notes
will be issued pursuant to an indenture, dated as of November 27, 1996 (the
"Base Indenture"), between the Company and The Bank of New York, as trustee (the
"Debt Trustee"), and a supplement to the Base Indenture, to be dated as of
December 4, 1996 (the "Supplemental Indenture," and together with the Base
Indenture and any other amendments or supplements thereto, the "Indenture"),
between the Company and the Debt Trustee.
SECTION 1. REPRESENTATIONS AND WARRANTIES. (a) The Offerors jointly and
severally represent and warrant to each Underwriter as of the date hereof and as
of the Closing Time (as hereinafter defined) and as of the Option Closing Time
(as hereinafter defined), if any, as follows:
- 3 -
<PAGE>
(i) At the time the Registration Statement became effective
and as of the date hereof, the Registration Statement complied in all
material respects with the requirements of the 1933 Act and the 1933
Act Regulations and the 1939 Act and the rules and regulations of the
Commission under the 1939 Act (the "1939 Act Regulations"), and did not
contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading. The Prospectus, dated the date
hereof (unless the term "Prospectus" refers to a prospectus that has
been provided to the Underwriters by the Trust for use in connection
with the offering of the Securities and that differs from the
Prospectus on file at the Commission at the time the Registration
Statement became effective, in which case, at the time it is first
provided to the Underwriters for such use) and at Closing Time or
Option Closing Time referred to in Section 2 hereof, does not include
an untrue statement of a material fact or omit 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; provided,
however, the Offerors make no representations or warranties as to (A)
that part of the Registration Statement which constitutes the
Statements of Eligibility and Qualification (Forms T-1) under the 1939
Act of the Debt Trustee, the Property Trustee or the Guarantee Trustee
or (B) the information contained in or omitted from the Registration
Statement or the Prospectus or any amendment thereof or supplement
thereto in reliance upon and in conformity with information furnished
in writing to the Offerors by or on behalf of any Underwriter through
the Representatives specifically for inclusion in the Registration
Statement and the Prospectus and actually included therein.
(ii) The documents incorporated or deemed to be incorporated
by reference in the Registration Statement or Prospectus, at the time
they were or hereafter are filed with the Commission complied and will
comply in all material respects with the requirements of the 1934 Act
and the rules and regulations of the Commission under the 1934 Act (the
"1934 Act Regulations").
(iii) To the best knowledge of the Offerors, Price Waterhouse
LLP, the accountants who certified the financial statements and
supporting schedules included in or incorporated by reference into the
Registration Statement, are independent public accountants as required
by the 1933 Act and the 1933 Act Regulations.
(iv) The Trust has been duly created and is validly existing
and in good standing as a business trust under the Delaware Act with
the power and authority to own property and to conduct its business as
described in the Registration Statement and Prospectus and to enter
into and perform its obligations under this Agreement, the Preferred
Securities, the Common Securities and the Declaration; the Trust is not
a party to or otherwise bound by any agreement other than those
described in the Prospectus; the Trust is and will be classified for
United States federal income tax purposes as a grantor trust and not as
an association taxable as a corporation; and the Trust is and will be
treated as a consolidated subsidiary of the Company pursuant to
generally accepted accounting principles.
- 4 -
<PAGE>
(v) The Common Securities have been duly authorized by the
Trust pursuant to the Declaration and, when issued and delivered by the
Trust to the Company against payment therefor as described in the
Registration Statement and Prospectus, will be validly issued and,
subject to the terms of the Declaration, fully paid and non-assessable
undivided beneficial interests in the assets of the Trust and will
conform to all statements relating thereto contained in the Prospectus;
the issuance of the Common Securities is not subject to preemptive or
other similar rights.
(vi) This Agreement has been duly authorized, executed and
delivered by each of the Offerors.
(vii) The Declaration has been duly authorized by the Company,
as Sponsor, and will have been duly executed and delivered by the
Company and the Trustees, and assuming due authorization, execution and
delivery of the Declaration by the Property Trustee, the Declaration is
and will be a valid and binding obligation of the Company, the Trust
and the Regular Trustees, enforceable against the Company and the
Regular Trustees in accordance with its terms, subject, as to
enforcement of remedies, to applicable bankruptcy, reorganization,
insolvency, moratorium, fraudulent conveyance or other similar laws
affecting the rights of creditors now or hereafter in effect, and to
equitable principles that may limit the right to specific enforcement
of remedies, and further subject to 12 U.S.C. 1818(b)(6)(D) (or any
successor statute) and any bank regulatory powers now or hereafter in
effect and to the application of principles of public policy
(collectively, the "Permitted Exceptions") and will conform to all
statements relating thereto in the Prospectus; and the Declaration has
been duly qualified under the 1939 Act.
(viii) Each of the Guarantee Agreements has been duly
authorized by the Company and, when validly executed and delivered by
the Company, and, in the case of the Preferred Securities Guarantee
Agreement, assuming due authorization, execution and delivery of the
Preferred Securities Guarantee by the Guarantee Trustee, will
constitute a valid and binding obligation of the Company, enforceable
against the Company in accordance with its terms except to the extent
that enforcement thereof may be limited by the Permitted Exceptions,
and each of the Guarantees and the Guarantee Agreements will conform to
all statements relating thereto contained in the Prospectus; and the
Trust pursuant to the Preferred Securities Guarantee Agreement will
have been duly qualified under the 1939 Act.
(ix) The Preferred Securities have been duly authorized by the
Trust pursuant to the Declaration and, when issued and delivered
pursuant to this Agreement against payment of the consideration
therefor set forth in Schedule B hereto will be validly issued and,
subject to the terms of the Declaration, fully paid and non-assessable
undivided beneficial interests in the Trust, will be entitled to the
benefits of the Declaration and will conform to all statements relating
thereto contained in the Prospectus; the issuance of the
Preferred Securities is not subject to preemptive or other similar
rights; and, subject to the
- 5 -
<PAGE>
terms of the Declaration, holders of Preferred Securities will be
entitled to the same limitation of personal liability under Delaware
law as extended to stockholders of private corporations for profit.
(x) Each of the Regular Trustees of the Trust is an employee
of the Company and has been duly authorized by the Company to execute
and deliver the Declaration; the Declaration has been duly executed and
delivered by the Regular Trustees and is a valid and binding obligation
of each Regular Trustee, enforceable against such Regular Trustee in
accordance with its terms except to the extent that enforcement thereof
may be limited by the Permitted Exceptions.
(xi) None of the Offerors is, and upon the issuance and sale
of the Preferred Securities as herein contemplated and the application
of the net proceeds therefrom as described in the Prospectus none will
be, an "investment company" or a company "controlled" by an "investment
company" within the meaning of the Investment Company Act of 1940, as
amended (the "1940 Act").
(xii) No authorization, approval, consent or order of any
court or governmental authority or agency is necessary in connection
with the issuance and sale of the Common Securities or the offering of
the Preferred Securities, the Junior Subordinated Notes or the
Guarantees hereunder, except such as may be required under the 1933 Act
or the 1933 Act Regulations or state securities laws and the
qualification of the Declaration, the Preferred Securities Guarantee
Agreement and the Indenture under the 1939 Act.
(b) The Company represents and warrants to each Underwriter as
of the date hereof and as of the Closing Time (as hereinafter defined) and as of
the Option Closing Time (as hereinafter defined), if any, as follows:
(i) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, except as
otherwise stated therein, (A) there has been no material adverse change
in the condition, financial or otherwise, or in the earnings or
business affairs of the Trust or the Company and its subsidiaries,
considered as one enterprise, whether or not arising in the ordinary
course of business.
(ii) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of North Carolina with corporate power to own, lease and operate its
properties and to conduct its business as described in the Prospectus,
to enter into and perform its obligations under this Agreement, the
Declaration, as Sponsor, the Indenture and each of the Guarantee
Agreements and to purchase, own, and hold the Common Securities issued
by the Trust; the Company is duly registered as a bank holding company
under the Bank Holding Company Act of 1956, as amended; and the
Company is duly qualified as a foreign corporation to transact business
and is in good standing in each jurisdiction in which the character or
location of its properties or the nature or the conduct of its business
requires such qualification, except
- 6 -
<PAGE>
for any failures to be so qualified or in good standing which, taken as
a whole, are not material to the Company and its subsidiaries,
considered as one enterprise.
(iii) NationsBank, National Association, NationsBank, National
Association (South) and NationsBank of Texas, National Association (or
the successors to such entities) (collectively, the "Principal
Subsidiary Banks") are national banking associations formed under the
laws of the United States and authorized thereunder to transact
business; all of the issued and outstanding capital stock of each
Principal Subsidiary Bank has been duly authorized and validly issued,
is fully paid and non-assessable; and the capital stock of each
Principal Subsidiary Bank owned by the Company, directly or through
subsidiaries, is owned free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity.
(iv) The Indenture has been duly authorized by the Company
and, when validly executed and delivered by the Company, will
constitute a valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms except to the extent
that enforcement thereof may be limited by the Permitted Exceptions;
the Indenture will conform to all statements relating thereto contained
in the Prospectus; and the Indenture has been duly qualified under the
1939 Act.
(v) The Junior Subordinated Notes have been duly authorized by
the Company and have been duly executed by the Company and, when
authenticated in the manner provided for in the Indenture and delivered
against payment therefor as described in the Prospectus, 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 the Permitted Exceptions,
will be in the form contemplated by, and subject to the Permitted
Exceptions entitled to the benefits of, the Indenture and will conform
to all statements relating thereto in the Prospectus.
(vi) The Company's obligations under the Guarantee Agreements
are subordinate and junior in right of payment to all liabilities of
the Company and are pari passu with the most senior preferred stock
issued by the Company.
(vii) The Junior Subordinated Notes are subordinated and
junior in right of payment to all "Senior Obligations" (as defined in
the Indenture) of the Company.
(viii) Each holder of securities of the Company having rights
to the registration of such securities under the Registration Statement
has waived such rights or such rights have expired by reason of lapse
of time following notification of the Company's intention to file the
Registration Statement.
(ix) The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated herein and
compliance by the Company with its obligations hereunder will not
conflict with or constitute a breach of, or default
- 7 -
<PAGE>
under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of the
Principal Subsidiary Banks pursuant to, any contract, indenture,
mortgage, loan agreement, note, lease or other instrument to which the
Company or any of the Principal Subsidiary Banks is a party or by which
it or any of them may be bound, or to which any of the property or
assets of the Company or any of the Principal Subsidiary Banks is
subject (except for conflicts, breaches and defaults which would not,
individually or in the aggregate, be materially adverse to the Company
and its subsidiaries taken as a whole or materially adverse to the
transactions contemplated by this Agreement), nor will such action
result in any material violation of the provisions of the articles of
incorporation or by-laws of the Company, or any applicable law,
administrative regulation or administrative or court decree.
(c) Each certificate signed by any officer of the
Company and delivered to the Representatives or counsel for the Underwriters
shall be deemed to be a representation and warranty by the Company to each
Underwriter as to the matters covered thereby.
(d) The Trust represents and warrants to each Underwriter as
of the date hereof and as of the Closing Time (as hereinafter defined) and as of
the Option Closing Time (as hereinafter defined), if any, as follows:
(i) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, except as
otherwise stated therein, (A) there has been no material adverse change
in the condition, financial or otherwise, or in the earnings or
business affairs of the Trust, whether or not arising in the ordinary
course of business, and (B) there have been no transactions entered
into by the Trust, other than in the ordinary course of business, which
are material with respect to the Trust.
(ii) Except as disclosed in the Prospectus, there is no
action, suit or proceeding before or by any government, governmental
instrumentality or court, domestic or foreign, now pending or, to the
best knowledge of the Trust, threatened, against or affecting the Trust
that is required to be disclosed in the Prospectus, other than actions,
suits or proceedings which are not reasonably expected, individually or
in the aggregate, to have a material adverse effect on the condition,
financial or otherwise, or in the earnings or business affairs of the
Trust, whether or not arising in the ordinary course of business; and
there are no transactions, contracts or documents of the Trust that are
required to be filed as exhibits to the Registration Statement by the
1933 Act or by the 1933 Act Regulations that have not been so filed.
(iii) The Trust possesses adequate certificates, authorities
or permits issued by the appropriate state, federal or foreign
regulatory agencies or bodies to conduct the business now operated by
it, and the Trust has not received any notice of proceedings relating
to the revocation or modification of any such certificate, authority or
permit which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding would
- 8 -
<PAGE>
materially and adversely affect the condition, financial
or otherwise, or in the earnings or business affairs of the Trust.
(iv) The execution, delivery and performance of this
Agreement, the Declaration and the Guarantee Agreements, the issuance
and sale of the Preferred Securities and the Common Securities, and the
consummation of the transactions contemplated herein and therein and
compliance by the Trust with its obligations hereunder and thereunder
have been duly authorized by all necessary action (corporate or
otherwise) on the part of the Trust and do not and will not result in
any violation of the Declaration or Certificate of Trust and do not and
will not conflict with, or result in a breach of any of the terms or
provisions of, or constitute a default under, or result in the creation
or imposition of any lien, charge or encumbrance upon any property or
assets of the Trust under (A) any contract, indenture, mortgage, loan
agreement, note, lease or other agreement or instrument to which the
Trust is a party or by which it may be bound or to which any of its
properties may be subject or (B) any existing applicable law, rule,
regulation, judgment, order or decree of any government, governmental
instrumentality or court, domestic or foreign, or any regulatory body
or administrative agency or other governmental body having jurisdiction
over the Trust, or any of its properties (except for conflicts,
breaches, violations or defaults which would not, individually or in
the aggregate, be materially adverse to the Trust, or materially
adverse to the transactions contemplated by this Agreement).
(e) Each certificate signed by any Trustee of the
Trust and delivered to the Representatives or counsel for the Underwriters shall
be deemed to be a representation and warranty by the Trust to each Underwriter
as to the matters covered thereby.
SECTION 2. SALE AND DELIVERY TO UNDERWRITERS; CLOSING.
(a) On the basis of the representations and warranties herein contained
and subject to the terms and conditions herein set forth, the Trust agrees to
sell to each Underwriter, severally and not jointly, and each Underwriter,
severally and not jointly, agrees to purchase from the Trust, at the price per
security set forth in the Schedule B, the number of Initial Preferred Securities
set forth in Schedule A opposite the name of such Underwriter (except as
otherwise provided in Schedule B), plus any additional number of Initial
Preferred Securities that such Underwriter may become obligated to purchase
pursuant to the provisions of Section 10 hereof.
The purchase price per security to be paid by the several Underwriters
for the Initial Preferred Securities shall be an amount equal to the initial
public offering price. The initial public offering price per Preferred Security
shall be a fixed price to be determined by agreement between the Representatives
and the Offerors. The initial public offering price and the purchase price are
be set forth in Schedule B. As compensation to the Underwriters for their
commitments hereunder and in view of the fact that the proceeds of the sale of
the Initial Preferred Securities will be used to purchase the Junior
Subordinated Notes of the Company, the Company hereby agrees to pay at Closing
Time to the Representatives, for the accounts of the several
- 9 -
<PAGE>
Underwriters, a commission per Initial Preferred Security determined by
agreement between the Representatives and the Company for the Initial Preferred
Securities to be delivered by the Trust hereunder at Closing Time. The
commission is set forth in Schedule B.
(b) Payment of the purchase price for, and delivery of certificates
for, the Initial Preferred Securities shall be made at the office of Stroock &
Stroock & Lavan, or at such other place as shall be agreed upon by the
Representatives, the Company and the Trust, at 10:00 A.M. New York time on the
fourth business day (unless postponed in accordance with the provisions of
Section 10) after the date hereof, or such other time not later than ten
business days after such date as shall be agreed upon by Representatives, the
Trust and the Company (such time and date of payment and delivery being herein
called "Closing Time"). Payment shall be made to the Trust by wire transfer or
certified or official bank check or similar same day funds payable to the order
of the Trust to an account designated by the Trust, against delivery to the
Representatives for the respective accounts of the Underwriters of certificates
for the Initial Preferred Securities to be purchased by them. Unless otherwise
agreed, certificates for the Initial Preferred Securities shall be in the form
set forth in the Declaration, and such certificates shall be deposited with a
custodian (the "Custodian") for The Depository Trust Company ("DTC") and
registered in the name of Cede & Co., as nominee for DTC.
At the Closing Time, or at the Option Closing Time, as the case may be,
the Company will pay, or cause to be paid, the commission payable at such time
to the Underwriters under Section 2 hereof by wire transfer or certified or
official bank check or checks payable to the Representatives in same day funds.
(c) In addition, on the basis of the representations and warranties
contained herein, and subject to the terms and conditions set forth herein, the
Trust grants an option to the Underwriters, severally and not jointly, to
purchase up to an additional 3,600,000 Option Preferred Securities at the same
price per security determined as provided above for the Initial Preferred
Securities plus any accrued distributions thereon. The option hereby granted
will expire 30 days after the date hereof, and may be exercised, in whole or in
part, only for the purpose of covering over-allotments upon written notice by
the Representatives to the Trust and the Company setting forth the number of
Option Preferred Securities as to which the several Underwriters are exercising
the option, the time and date of payment and delivery thereof. Such times and
dates of delivery (each, an "Option Closing Time") shall be determined by the
Representatives but shall not be later than three full business days after the
exercise of such option and not in any event prior to the Closing Time. If the
option is exercised as to all or any portion of the Option Preferred Securities,
the Option Preferred Securities as to which the option is exercised shall be
purchased by the Underwriters severally and not jointly, in proportion to, as
nearly as practicable, their respective Initial Preferred Securities
underwriting obligations as set forth on Schedule A. The Company hereby agrees
to pay at the Option Closing Time to the Representatives, for the accounts of
the several Underwriters, a commission per Option Preferred Security equal to
the commission set forth on Schedule B.
- 10 -
<PAGE>
In addition, in the event that any or all of the Option Preferred
Securities are purchased by the Underwriters, delivery and payment for the
Option Preferred Securities shall be made at the offices of Stroock & Stroock &
Lavan, or at such other place as the Trust, the Company and the Representatives
shall determine, on each Option Closing Time as specified in the notice from the
Representatives to the Company. Delivery of the Option Preferred Securities
shall be made to the Representatives against payment by the Underwriters through
the Representatives of the purchase price thereof to or upon the order of the
Company in the manner set forth in Section 2(b) above. Unless otherwise agreed,
certificates for the Option Preferred Securities shall be in the form set forth
in the Declaration, and such certificates shall be deposited with the Custodian
for DTC and registered in the name of Cede & Co., as nominee for DTC.
SECTION 3. COVENANTS OF THE OFFERORS. Each of the
Offerors jointly and severally covenants with each Underwriter as follows:
(a) The Offerors will notify the Representatives promptly, and confirm
the notice in writing, (i) of the effectiveness of the Registration Statement
and any amendment thereto (including any post-effective amendment), (ii) of the
receipt of any comments from the Commission, (iii) of any request by the
Commission for any amendment to the Registration Statement or any amendment or
supplement to the Prospectus or for additional information, and (iv) of the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or the initiation of any proceedings for that purpose.
The Offerors will make every reasonable effort to prevent the issuance of any
stop order and, if any stop order is issued, to obtain the lifting thereof at
the earliest possible moment.
(b) The Offerors will give the Representatives notice of their
intention to file or prepare (i) any amendment to the Registration Statement
(including any post-effective amendment), (ii) any amendment or supplement to
the Prospectus (including any revised prospectus which the Offerors propose for
use by the Underwriters in connection with the offering of the Preferred
Securities which differs from the prospectus on file at the Commission at the
time the Registration Statement became effective, whether or not such revised
prospectus is required to be filed pursuant to Rule 424(b) of the 1933 Act
Regulations), or (iii) any document that would as a result thereof be
incorporated by reference in the Prospectus whether pursuant to the 1933 Act,
the 1934 Act or otherwise, will furnish the Representatives with copies of any
such amendment, supplement or other document within a reasonable amount of time
prior to such proposed filing or use, as the case may be, and will not file any
such amendment, supplement or other document or use any such prospectus to which
the Representatives or counsel for the Underwriters shall reasonably object.
Subject to the foregoing, the Offerors will file the Prospectus pursuant to Rule
424(b) and Rule 430A under the Act not later than the Commission's close of
business on the second business day following the execution and delivery of this
Agreement.
(c) The Offerors will deliver to the Representatives as many signed
copies of the Registration Statement as originally filed and of each amendment
thereto (including exhibits filed therewith or incorporated by reference therein
and documents incorporated or deemed to be incorporated by reference therein) as
the Representatives may reasonably request and will also
- 11 -
<PAGE>
deliver to the Representatives a conformed copy of the Registration Statement as
originally filed and of each amendment thereto (without exhibits) for each of
the Underwriters.
(d) The Offerors will furnish to each Underwriter, from time to time
during the period when the Prospectus is required to be delivered under the 1933
Act, such number of copies of the Prospectus (as amended or supplemented) as
such Underwriter may reasonably request for the purposes contemplated by the
1933 Act or the respective applicable rules and regulations of the Commission
thereunder.
(e) If at any time when the Prospectus is required by the 1933 Act to
be delivered in connection with sales of the Preferred Securities, any event
shall occur as a result of which the Prospectus as then amended or supplemented
will include any untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein in light of the
circumstances under which they were made not misleading or if it shall be
necessary to amend or supplement the Prospectus in order to comply with the
requirements of the 1933 Act or the 1933 Act Regulations, the Offerors will,
subject to paragraph (b) above, promptly prepare and file with the Commission
such amendment or supplement which will correct such statement or omission or an
amendment which will effect such compliance and the Offerors will furnish to the
Underwriters a reasonable number of copies of such amendment or supplement.
(f) The Offerors will endeavor, in cooperation with the Underwriters,
to qualify the Preferred Securities (and the Preferred Securities Guarantee) and
the Junior Subordinated Notes for offering and sale under the applicable
securities laws of such states and the other jurisdictions of the United States
as the Representatives may designate; provided, however, that none of the
Offerors shall be obligated to qualify as a foreign corporation in any
jurisdiction in which it is not so qualified.
(g) The Company will make generally available to its security holders
and to the Underwriters as soon as practicable, but not later than 90 days after
the close of the period covered thereby, an earnings statement (which need not
be audited) of the Company and its subsidiaries, covering an applicable period
beginning not later than the first day of the Company's fiscal quarter next
following the "Effective Date" (as defined in Rule 158(c) under the Act) of the
Registration Statement, which will satisfy the provisions of Section 11(a) of
the 1933 Act.
(h) The Offerors will use best efforts to effect the listing of the
Preferred Securities on the New York Stock Exchange; if the Preferred Securities
are exchanged for Junior Subordinated Notes, the Company will use its best
efforts to effect the listing of the Junior Subordinated Notes on the exchange
on which the Preferred Securities were then listed.
(i) During a period of 30 days from the date hereof, neither the Trust
nor the Company will, without the Representatives' prior written consent,
directly or indirectly, sell, offer to sell, grant any option for the sale of,
or otherwise dispose of, any Preferred Securities, any security convertible into
or exchangeable into or exercisable for Preferred Securities or the Junior
Subordinated Notes or any junior subordinated debt securities substantially
similar to the Junior
- 12 -
<PAGE>
Subordinated Notes or equity securities substantially similar to the
Preferred Securities (except for the Junior Subordinated Notes and the
Preferred Securities issued pursuant to this Agreement); and except for any
preferred securities with a liquidation amount of greater than $25 which are
non-callable for at least years 10 years (except for any call provisions
relating to unanticipated tax or accounting consequences to the Sponsor, the
Trust or holders of such preferred securities or status of the Trust under the
1940 Act) and any junior subordinated debt securities issued in connection
therewith.
SECTION 4. PAYMENT OF EXPENSES. The Company will pay all expenses
incident to the performance of each Offerors' obligations under this Agreement,
and will pay: (i) the printing and filing of the Registration Statement as
originally filed and of each amendment thereto, (ii) the preparation, issuance
and delivery of the certificates for the Preferred Securities, (iii) the fees
and disbursements of the Company's and the Trust's counsel and accountants, (iv)
the qualification of the Preferred Securities, the Preferred Securities
Guarantee and the Junior Subordinated Notes under securities laws in accordance
with the provisions of Section 3(f) hereof, including filing fees and the fees
and disbursements of Stroock & Stroock & Lavan, counsel for the Underwriters, in
connection therewith and in connection with the preparation of any blue sky
survey, (v) the printing and delivery to the Underwriters of copies of the
Registration Statement as originally filed and of each amendment thereto, of
each preliminary prospectus, and of the Prospectus and any amendments or
supplements thereto, (vi) the printing and delivery to the Underwriters of
copies of any blue sky survey, (vii) the fee of the National Association of
Securities Dealers, Inc., if applicable, (viii) the fees and expenses of the
Debt Trustee, including the fees and disbursements of counsel for the Debt
Trustee in connection with the Indenture and the Junior Subordinated Notes, (ix)
the fees and expenses of the Property Trustee, and the Guarantee Trustee,
including the fees and disbursements of counsel for the Property Trustee in
connection with the Declaration and the Certificate of Trust; (x) any fees
payable in connection with the rating of the Preferred Securities and Junior
Subordinated Notes; (xi) the fees and expenses incurred in connection with the
listing of the Preferred Securities and, if applicable, the Junior Subordinated
Notes on the New York Stock Exchange, and (xii) the cost and charges of any
transfer agent or registrar and (xiii) the cost of qualifying the Preferred
Securities with DTC.
If this Agreement is terminated by the Representatives in accordance
with the provisions of Section 5 or Section 9 hereof, the Company shall
reimburse the Underwriters for all of their reasonable out-of-pocket expenses,
including the reasonable fees and disbursements of Stroock & Stroock & Lavan,
counsel for the Underwriters.
SECTION 5. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations of
the Underwriters hereunder are subject to the accuracy of the representations
and warranties of the Offerors herein contained or in certificates of officers
of the Company, to the performance by the Offerors of their obligations
hereunder, and to the following further conditions:
(a) The Registration Statement shall have become effective not later
than 5:30 P.M. on the date hereof, or with the consent of the Representatives,
at a later time and date, not later,
- 13 -
<PAGE>
however, than 5:30 P.M. on the first business day following the date hereof,
or at such later time and date as may be approved by the Representatives;
and at Closing Time no stop order suspending the effectiveness of the
Registration Statement shall have been issued under the 1933 Act or
proceedings therefor initiated or threatened by the Commission. The
Prospectus shall have been filed with the Commission pursuant to Rule 424(b)
within the applicable time period prescribed for such filing by the 1933
Regulations and in accordance with Section 3(b) and prior to Closing Time
the Offerors shall have provided evidence satisfactory to the
Representatives of such timely filing.
(b) At Closing Time the Representatives shall have received:
(1) The favorable opinion of Smith Helms Mulliss & Moore,
L.L.P., counsel for the Company, dated as of the Closing Time, to the effect of
paragraphs (i) and (v) through (xvii) below, and the favorable opinion of Paul
J. Polking, General Counsel to the Company, dated as of the Closing Time, to the
effect of paragraphs (ii), (iii) and (iv) below:
(i) The Company is a duly organized and validly existing
corporation in good standing under the laws of the State of North
Carolina, has the corporate power and authority to own its properties,
conduct its business as described in the Prospectus and perform its
obligations under this Agreement, and is duly registered as a bank
holding company under the Bank Holding Company Act of 1956, as amended;
the Principal Subsidiary Banks are national banking associations formed
under the laws of the United States and authorized thereunder to
transact business.
(ii) Except for those jurisdictions specifically enumerated in
such opinion, neither the Company nor any of the Principal Subsidiary
Banks is required to be qualified or licensed to do business as a
foreign corporation in any jurisdiction.
(iii) All the outstanding shares of capital stock of each
Principal Subsidiary Bank have been duly and validly authorized and
issued and are fully paid and (except as provided in 12 U.S.C. ss. 55,
as amended) non-assessable, and, except as otherwise set forth in the
Prospectus, all outstanding shares of capital stock of the Principal
Subsidiary Banks (except directors' qualifying shares) are owned,
directly or indirectly, by the Company free and clear of any perfected
security interest and, to the best knowledge of such counsel, any other
security interests, claims, liens or encumbrances.
(iv) To the best knowledge of such counsel, there is no
pending or threatened action, suit or proceeding before any court or
governmental agency, authority or body or any arbitrator involving the
Company or any of its subsidiaries, of a character required to be
disclosed in the Registration Statement which is not adequately
disclosed in the Prospectus, and there is no franchise, contract, or
other document of a character required to be described in the
Registration Statement or Prospectus, or to be filed as an exhibit,
which is not described or filed as required.
- 14 -
<PAGE>
(v) If the Initial Preferred Securities are to be listed on
the New York Stock Exchange, authorization therefor has been given,
subject to official notice of issuance and evidence of satisfactory
distribution, or the Company has filed a preliminary listing
application and all required supporting documents with respect to the
Initial Preferred Securities with the New York Stock Exchange and such
counsel has no reason to believe that the Initial Preferred Securities
will not be authorized for listing, subject to official notice of
issuance and evidence of satisfactory distribution.
(vi) The Registration Statement has become effective under the
1933 Act; to the best knowledge of such counsel, no stop order
suspending the effectiveness of the Registration Statement has been
issued and no proceedings for that purpose have been instituted or
threatened; the Registration Statement, the Prospectus and each
amendment thereof or supplement thereto (other than the financial
statements and other financial and statistical information contained
therein or incorporated by reference therein, as to which such counsel
need express no opinion) comply as to form in all material respects
with the applicable requirements of the 1933 Act and the 1933 Act
Regulations and the 1934 Act and the 1934 Act Regulations.
(vii) This Agreement has been duly authorized, executed and
delivered by the Company and constitutes a legal, valid and binding
instrument enforceable against the Company in accordance with its terms
(subject to the Permitted Exceptions, and except insofar as the
enforceability of the indemnity and contribution provisions contained
in this Agreement may be limited by federal and state securities laws,
and further subject to 12 U.S.C. 1818(b)(6)(D) and any bank regulatory
powers and to the application of principles of public policy).
(viii) No authorization, approval, consent or order of any
court or governmental authority or agency is required in connection
with the offering, issuance or sale of the Initial Preferred
Securities, the Preferred Securities Guarantee and the Junior
Subordinated Notes to the Underwriters, except (a) such as may be
required under the 1933 Act and the 1933 Act Regulations and such as
may be required under the blue sky or insurance laws of any
jurisdiction, and (b)the qualification of the Declaration, the
Preferred Securities Guarantee Agreement and the Indenture under the
1939 Act.
(ix) The Declaration has been duly authorized, executed and
delivered by the Company and the Regular Trustees and has been duly
qualified under the 1939 Act.
(x) Each of the Guarantee Agreements has been duly authorized,
executed and delivered by the Company; the Preferred Securities
Guarantee Agreement, assuming it is duly authorized, executed and
delivered by the Guarantee Trustee, constitutes a valid and binding
obligation of the Company, enforceable against the Company in
accordance with its terms, except to the extent that enforcement
thereof may be limited by the Permitted Exceptions; and the Preferred
Securities Guarantee Agreement has been duly qualified under the 1939
Act.
- 15 -
<PAGE>
(xi) The Indenture has been duly executed and delivered by the
Company and, assuming due authorization, execution, and delivery
thereof by the Debt Trustee, is a valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms,
except to the extent that enforcement thereof may be limited by the
Permitted Exceptions; the Indenture has been duly qualified under the
1939 Act; and the Indenture conforms to the description thereof in the
Prospectus.
(xii) The Junior Subordinated Notes have been duly authorized
and executed by the Company and, when authenticated by the Trustee in
the manner provided in the Indenture and delivered against payment
therefor, 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 the Permitted
Exception; and the Junior Subordinated Notes conform to the description
thereof in the Prospectus.
(xiii) Neither the Company nor the Trust is, and upon the
issuance and sale of the Securities as herein contemplated and the
application of the net proceeds therefrom as described in the
Prospectus neither will be, an "investment company" or a company
"controlled" by an "investment company" within the meaning of the 1940
Act.
(xiv) The Common Securities, the Initial Preferred Securities
and the Declaration conform in all material respects to all statements
relating thereto contained in the Prospectus.
(xv) All of the issued and outstanding Common Securities of
the Trust are directly owned by the Company free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim or
equitable right.
(xvi) The Trust is not a party to or otherwise bound by any
agreement other than those described in the Prospectus.
(xvii) This Agreement has been duly executed and delivered by
the Trust.
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the State of
North Carolina or the United States, to the extent deemed proper and specified
in such opinion, upon the opinion of other counsel of good standing believed to
be reliable and who are satisfactory to counsel for the Underwriters; and (B) as
to matters of fact, to the extent deemed proper, on the representations and
warranties of the Offerors contained herein or in the Declaration, the
Indenture, the Guarantee Agreements, that certain subscription agreement, of
even date herewith, between the Company and the Trust covering the Common
Securities and that certain note purchase agreement, of even date herewith,
between the Company and the Trust or on certificates of responsible officers of
the Company and its subsidiaries and public officials.
- 16 -
<PAGE>
(2) The favorable opinion of Richards, Layton & Finger,
Special Delaware counsel to the Offerors, in form and substance satisfactory to
counsel for the Underwriters, 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; all filings
required under the laws of the State of Delaware with respect to the
formation and valid existence of the Trust as a business trust have
been made; the Trust has all necessary power and authority to own
property and to conduct its business as described in the Registration
Statement and the Prospectus and to enter into and perform its
obligations under this Agreement, the Initial Preferred Securities and
the Common Securities.
(ii) Assuming due authorization, execution and delivery by the
Company and the Trustees, the Declaration is a valid and binding
obligation of the Company, enforceable against the Company in
accordance with its terms, except as enforcement thereof may be limited
by the Permitted Exceptions.
(iii) The Common Securities have been duly authorized by the
Declaration and are validly issued and represent undivided beneficial
interests in the assets of the Trust.
(iv) The Initial Preferred Securities have been duly
authorized by the Declaration and are validly issued and, subject to
the terms of the Declaration, when delivered to and paid for by the
Underwriters pursuant to this Agreement, will be validly issued, fully
paid and non-assessable beneficial interests in the assets of the
Trust; the holders of the Initial Preferred Securities will, subject to
the terms of the Declaration, be entitled to the same limitation of
personal liability under Delaware law as is extended to stockholders of
private corporations for profit; and the issuance of the Initial
Preferred Securities is not subject to preemptive or other similar
rights.
(v) This Agreement has been duly authorized by the Trust.
(vi) The issuance and sale by the Trust of the Initial
Preferred Securities and the Common Securities, the execution, delivery
and performance by the Trust of this Agreement, the consummation by the
Trust of the transactions contemplated hereby and the compliance by the
Trust with its obligations hereunder will not violate (i) any of the
provisions of the Certificate of Trust or the Declaration or (ii) any
applicable Delaware law or administrative regulation.
(3) The favorable opinion of Richards, Layton & Finger,
Special Delaware counsel to The Bank of New York (Delaware), in form and
substance satisfactory to counsel for the Underwriters, to the effect that:
- 17 -
<PAGE>
(i) The Bank of New York (Delaware) is a Delaware banking
corporation with trust powers, duly organized, validly existing and in
good standing under the laws of the State of Delaware with all
necessary power and authority to execute and deliver, and to carry out
and perform its obligations under the terms of the Declaration.
(ii) The execution, delivery and performance by the Delaware
Trustee of the Declaration has been duly authorized by all necessary
corporate action on the part of, the Delaware Trustee. The Declaration
has been duly executed and delivered by the Delaware Trustee, and
constitutes the legal, valid and binding obligation of the Delaware
Trustee, enforceable against the Delaware Trustee in accordance with
its terms, except as enforcement thereof may be limited by the
Permitted Exceptions.
(iii) The execution, delivery and performance of the
Declaration by the Delaware Trustee does not conflict with or
constitute a breach of the Articles of Organization or Bylaws of the
Delaware Trustee.
(iv) No consent, approval or authorization of, or registration
with or notice to, any Delaware or federal banking authority is
required for the execution, delivery or performance by the Delaware
Trustee of the Declaration.
(4) The favorable opinion, dated as of Closing Time, of
Emmett, Marvin & Martin, LLP, counsel of The Bank of New York, as Debt Trustee
under the Indenture, as Guarantee Trustee under the Preferred Securities
Guarantee Agreement, and as Property Trustee under the Declaration, in form and
substance satisfactory to counsel for the Underwriters, to the effect that:
(i) The Bank of New York is a New York banking corporation
with trust powers, duly organized, validly existing and in good
standing under the laws of the State of New York with all necessary
power and authority to execute and deliver, and to carry out and
perform its obligations under the terms of the Declaration, the
Indenture and the Preferred Securities Guarantee Agreement.
(ii) The execution, delivery and performance by the Debt
Trustee of the Indenture, the execution, delivery and performance by
the Property Trustee of the Declaration, and the execution, delivery
and performance by the Guarantee Trustee of the Preferred Securities
Guarantee Agreement have been duly authorized by all necessary
corporate action on the part of the Debt Trustee, the Property Trustee
and the Guarantee Trustee, respectively. The Indenture has been duly
executed and delivered by the Debt Trustee, and constitutes the legal,
valid and binding obligations of the Debt Trustee, enforceable against
the Debt Trustee in accordance with its terms, except as enforcement
thereof may be limited by the Permitted Exceptions. The Declaration has
been duly executed and delivered by the Property Trustee, and
constitutes the legal, valid and binding obligations of the Property
Trustee, enforceable against the Property Trustee in accordance with
its terms, except as enforcement thereof may be limited by the
Permitted
- 18 -
<PAGE>
Exceptions. The Preferred Securities Guarantee Agreement has
been duly executed and delivered by the Guarantee Trustee, and
constitutes the legal, valid and binding obligations of the Guarantee
Trustee, enforceable against the Guarantee Trustee in accordance with
its terms, except as enforcement thereof may be limited by the
Permitted Exceptions.
(iii) The execution, delivery and performance of the Indenture
by the Debt Trustee, does not conflict with or constitute a breach of
the Articles of Organization or Bylaws of the Debt Trustee. The
execution, delivery and performance of the Declaration by the Property
Trustee does not conflict with or constitute a breach of the Articles
of Organization or Bylaws of the Property Trustee. The execution,
delivery and performance of the Preferred Securities Guarantee
Agreement by the Guarantee Trustee does not conflict with or constitute
a breach of the Articles of Organization or Bylaws of the Guarantee
Trustee.
(iv) No consent, approval or authorization of, or registration
with or notice to, any New York or federal banking authority is
required for the execution, delivery or performance by the Debt Trustee
of the Indenture. No consent, approval or authorization of, or
registration with or notice to, any New York or federal banking
authority is required for the execution, delivery or performance by the
Property Trustee of the Declaration. No consent, approval or
authorization of, or registration with or notice to, any New York or
federal banking authority is required for the execution, delivery or
performance by the Guarantee Trustee of the Preferred Securities
Guarantee Agreement.
(5) The favorable opinion, dated as of Closing Time, of
Stroock & Stroock & Lavan, counsel for the Underwriters, in form and substance
satisfactory to the Underwriters with respect to the legal existence of the
Company and the Trust, the Initial Preferred Securities, the Indenture, the
Preferred Securities Guarantee Agreement, this Agreement, the Registration
Statement, the Prospectus and other related matters as the Representatives may
require.
In giving its opinion, Stroock & Stroock & Lavan may rely as
to certain matters of Delaware law upon the opinion of Richards, Layton &
Finger, counsel for the Offerors, which shall be delivered in accordance with
Section 5(b)(2) hereto.
(6) The favorable opinion of Stroock & Stroock & Lavan,
special tax counsel to the Company and the Trust, as to certain Federal tax
matters set forth in the Prospectus under "United States Income Taxation."
(7) In giving their opinions required by subsection (b), of
this Section, Mr. Polking and Smith Helms Mulliss & Moore, L.L.P. shall each
additionally state that nothing has come to their attention that has caused them
to believe that the Registration Statement (except for financial statements and
schedules and other financial or statistical data included or incorporated by
reference, therein, as to which counsel need make no statement), at the time it
became effective or as of the date of their respective opinions, 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
- 19 -
<PAGE>
therein not misleading or that the Prospectus (except for financial
statements and schedules and other financial or statistical data included or
incorporated by reference therein, as to which counsel need make no
statement), as at the date hereof or at Closing Time, included an untrue
statement of a material fact or omitted to state a material fact necessary
in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
(8) At Closing Time, there shall not have been, since the date
hereof or since the respective dates as of which information is given in the
Registration Statement and the Prospectus, any material adverse change in the
condition, financial or otherwise, or in the earnings or business affairs of the
Trust or the Company and its subsidiaries, considered as one enterprise, whether
or not arising in the ordinary course of business, and the Representatives shall
have received a certificate of a Vice President of the Company and of the chief
financial or chief accounting officer of the Company and a certificate of the
Trustee of the Trust, and dated as of Closing Time, to the effect that (i) there
has been no such material adverse change, (ii) the representations and
warranties in Section 1 hereof are true and correct with the same force and
effect as though expressly made at and as of Closing Time, (iii) the Trust and
the Company have complied with all agreements and satisfied all conditions on
its part to be performed or satisfied at or prior to Closing Time, and (iv) no
stop order suspending the effectiveness of the Registration Statement has been
issued and no proceedings for that purpose have been initiated or threatened by
the Commission.
(9) At the Closing Time, Price Waterhouse LLP shall have
furnished to the Representatives a letter or letters (which may refer to letters
previously delivered to the Representatives), dated as of the Closing Time, in
form and substance satisfactory to the Representatives, confirming that the
response, if any, to Item 10 of the Registration Statement is correct insofar as
it relates to them and stating in effect that:
(i) They are independent accountants within the meaning of the
1933 Act and the 1934 Act and the 1933 Act Regulations and the 1934 Act
Regulations.
(ii) In their opinion, the consolidated financial statements
of the Company and its subsidiaries audited by them and included or
incorporated by reference in the Registration Statement and Prospectus
comply as to form in all material respects with the applicable
accounting requirements of the 1933 Act and the 1933 Act Regulations
with respect to registration statements on Form S-3 and the 1934 Act
and the 1934 Act Regulations.
(iii) On the basis of procedures (but not an audit in
accordance with generally accepted auditing standards) consisting of:
(a) Reading the minutes of the meetings of the shareholders,
the board of directors, executive committee and audit committee of the
Company and the boards of directors and executive committees of its
subsidiaries as set forth in the minute books
- 20 -
<PAGE>
through a specified date not more than five business days prior to the
date of delivery of such letter;
(b) Performing the procedures specified by the American
Institute of Certified Public Accountants for a review of interim
financial information as described in SAS No. 71, Interim Financial
Information, on the unaudited condensed consolidated interim financial
statements of the Company and its consolidated subsidiaries included or
incorporated by reference in the Registration Statement and Prospectus
and reading the unaudited interim financial data, if any, for the
period from the date of the latest balance sheet included or
incorporated by reference in the Registration Statement and Prospectus
to the date of the latest available interim financial data; and
(c) Making inquiries of certain officials of the Company who
have responsibility for financial and accounting matters regarding the
specific items for which representations are requested below;
nothing has come to their attention as a result of the
foregoing procedures that caused them to believe that:
(1) the unaudited condensed consolidated
interim financial statements, included or incorporated by
reference in the Registration Statement and Prospectus, do not
comply as to form in all material respects with the applicable
accounting requirements of the 1934 Act and the 1934 Act
Regulations thereunder;
(2) any material modifications should be made
to the unaudited condensed consolidated interim financial
statements, included or incorporated by reference in the
Registration Statement and Prospectus, for them to be in
conformity with generally accepted accounting principles;
(3) (i) at the date of the latest available
interim financial data and at the specified date not more than
five business days prior to the date of the delivery of such
letter, there was any change in the capital stock or the
long-term debt (other than scheduled repayments of such debt)
or any decreases in shareholders' equity of the Company and
the subsidiaries on a consolidated basis as compared with the
amounts shown in the latest balance sheet included or
incorporated by reference in the Registration Statement and
the Prospectus or (ii) for the period from the date of the
latest available financial data to a specified date not more
than five business days prior to the delivery of such letter,
there was any change in the capital stock or the long-term
debt (other than scheduled repayments of such debt) or any
decreases in shareholders' equity of the Company and the
subsidiaries on a consolidated basis, except in all instances
for changes or decreases which the Registration Statement and
Prospectus discloses have occurred or may occur, or Price
Waterhouse LLP shall state any specific changes or decreases.
- 21 -
<PAGE>
(iv) The letter shall also state that Price Waterhouse LLP has
carried out certain other specified procedures, not constituting an
audit, with respect to certain amounts, percentages and financial
information which are included or incorporated by reference in the
Registration Statement and Prospectus and which are specified by the
Representatives and agreed to by Price Waterhouse LLP, and has found
such amounts, percentages and financial information to be in agreement
with the relevant accounting, financial and other records of the
Company and its subsidiaries identified in such letter.
In addition, at the time this Agreement is executed, Price
Waterhouse LLP shall have furnished to the Representatives a letter or
letters, dated the date of this Agreement, in form and substance
satisfactory to the Representatives, to the effect set forth in this
subsection 8.
(10) At Closing Time, counsel for the Underwriters shall have
been furnished with such documents and opinions as they may require for the
purpose of enabling them to pass upon the issuance and sale of the Initial
Preferred Securities as herein contemplated and related proceedings, or in order
to evidence the accuracy of any of the representations or warranties, or the
fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Offerors, in connection with the issuance and sale of the Initial
Preferred Securities as herein contemplated shall be satisfactory in form and
substance to the Representatives and Stroock & Stroock & Lavan, counsel for the
Underwriters.
(11) At Closing Time, at least one "nationally recognized
statistical rating organization" (as defined for purposes of Rule 436(g) under
the 1933 Act), has rated the Initial Preferred Securities in one of its four
highest rating categories and there shall not have occurred any decrease in the
ratings of any of the securities of the Company or of the Initial Preferred
Securities by any nationally recognized statistical rating organization, and no
such organization shall have publicly announced that it has under surveillance
or review its rating of any of the Company's securities or any of the Initial
Preferred Securities.
(12) At Closing Time, the Initial Preferred Securities shall
have been approved for listing on the New York Stock Exchange upon notice of
issuance.
If any condition specified in this Section shall not have been
fulfilled in all material respects when and as required to be fulfilled, this
Agreement may be terminated by the Representatives by notice to the Offerors, in
writing or by telephone or telegraph confirmed in writing, at any time at or
prior to Closing Time, and such termination shall be without liability of
any party to any other party except as provided in Section 4 hereof, and except
that Sections 1, 7, and 8 shall survive any such termination and will remain in
full force and effect.
SECTION 6. CONDITIONS TO PURCHASE OF OPTION SECURITIES. In the event
the Underwriters exercise the Option to purchase all or any portion of the
Option Preferred Securities and the Option Closing Time determined by the
Representatives pursuant to Section 2
- 22 -
<PAGE>
is later than the Closing Time, the obligations of the several Underwriters
to purchase and pay for the Option Preferred Securities that they shall have
respectively agreed to purchase hereunder are subject to the accuracy of the
representations and warranties of the Offerors contained herein, to the
performance by the Offerors of their obligations hereunder and to the
following additional conditions:
(a) No stop order suspending the effectiveness of the Registration
Statement, as amended from time to time, shall have been issued and no
proceedings for that purpose shall have been instituted or threatened; and any
required filing of the Prospectus pursuant to Rule 424(b) under the Act shall
have been made within the proper time period.
(b) As of the Option Closing Time, the Representatives shall have
received, each dated as of the Option Closing Time and relating to the Option
Preferred Securities:
(i) the favorable opinions of Smith Helms Mulliss & Moore,
L.L.P., counsel for the Company, and of Paul J. Polking, General
Counsel to the Company, in form and substance satisfactory to counsel
for the Underwriters, to the same effect as the opinions required by
Section 5(b)(1). In giving their opinions required by this subsection
6(b)(i), Mr. Polking and Smith Helms Mulliss & Moore, L.L.P. shall each
additionally state that nothing has come to their attention that has
caused them to believe that the Registration Statement (except for
financial statements and schedules and other financial or statistical
data included or incorporated by reference, therein, as to which
counsel need make no statement), at the time it became effective or as
of the date of their respective opinions, contained an untrue statement
of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading or that the Prospectus (except for financial statements and
schedules and other financial or statistical data included or
incorporated by reference therein, as to which counsel need make no
statement), as at the date hereof or at Option Closing Time, included
an untrue statement of a material fact or omitted to state a material
fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading.
(ii) the favorable opinion of Richards Layton & Finger,
Special Delaware counsel to the Offerors, in form and substance
satisfactory to counsel for the Underwriters, to the same effect as the
opinion required by Section 5(b)(2);
and the favorable opinion of Richards Layton & Finger, Special Delaware
counsel to The Bank of New York (Delaware), in form and substance
satisfactory to counsel for the Underwriters, to the same effect as the
opinion required by Section 5(b)(3)
(iii) the favorable opinion of Emmett, Marvin & Martin,
L.L.P., counsel for The Bank of New York, to the same effect as the
opinion required by Section 5(b)(4);
- 23 -
<PAGE>
(iv) the favorable opinion of Stroock & Stroock & Lavan,
counsel for the Underwriters, in form and substance satisfactory to the
Underwriters to the same effect as the opinion required by Section
5(b)(5);
In giving its opinion, Stroock & Stroock & Lavan may rely as
to certain matters of Delaware law upon the opinion of Richards, Layton
& Finger, counsel for the Offerors, which shall be delivered in
accordance with Section 6(b)(2) hereto;
(v) the favorable opinion of Stroock & Stroock & Lavan,
special tax counsel to the Company and the Trust, to the same effect as
the opinion required by Section 5(b)(6);
(vi) a certificate, of a Vice President of the Company and of
the chief financial or chief accounting officer of the Company with
respect to the matters set forth in Section 5(b)(8);
(vii) a letter from Price Waterhouse LLP, in form and
substance satisfactory to the Underwriters, substantially the same in
scope and substance as the letter furnished to the Underwriters
pursuant to Section 5(b)(9) except that the "specified date" in the
letter furnished pursuant to this Section 6(b)(vii) shall be a date not
more than five days prior to the Option Closing Time;
(viii) Subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus,
there shall not have been (i) any change or decrease specified in the
letter or letters referred to in paragraph (b)(vii) of this Section 6
or (ii) any change in the condition, financial or otherwise, or in the
earnings or business affairs of the Company and its subsidiaries,
considered as one enterprise, the effect of which, in any case referred
to in clause (i) or (ii) above, is, in the judgment of the
Representatives, so material and adverse as to make it impractical or
inadvisable to proceed with the offering or the delivery of the
Securities as contemplated by the Registration Statement and the
Prospectus;
(ix) At the Option Closing Time, counsel for the Underwriters
shall have been furnished with such documents and opinions as they may
require for the purpose of enabling them to pass upon the issuance and
sale of the Option Preferred Securities as herein contemplated and
related proceedings, or in order to evidence the accuracy of any of the
representations or warranties, or the fulfillment of any of the
conditions, herein contained; and all proceedings taken by the
Offerors, in connection with the issuance and sale of the Option
Preferred Securities as herein contemplated shall be satisfactory in
form and substance to the Representatives and Stroock & Stroock &
Lavan, counsel for the Underwriters;
(x) At the Option Closing Time, at least one "nationally
recognized statistical rating organization" (as defined for purposes of
Rule 436(g) under the 1933 Act), has
- 24 -
<PAGE>
rated the Preferred Securities in one of its four highest rating
categories and there shall not have occurred any decrease in the
ratings of any of the securities of the Company or of the Preferred
Securities by any nationally recognized statistical rating
organization, and no such organization shall have publicly announced
that it has under surveillance or review its rating of any of the
Company's securities or any of the Preferred Securities; and
(xi) At the Option Closing Time, the Option Preferred
Securities shall have been approved for listing on the New York Stock
Exchange upon notice of issuance.
If any condition specified in this Section shall not have been
fulfilled in all material respects when and as required to be fulfilled, this
Agreement may be terminated by the Representatives by notice to the Offerors, in
writing or by telephone or telegraph confirmed in writing, at any time at or
prior to Option Closing Time, and such termination shall be without liability of
any party to any other party except as provided in Section 4 hereof, and except
that Sections 1, 7, and 8 shall survive any such termination and will remain in
full force and effect.
-25-
<PAGE>
SECTION 7. INDEMNIFICATION AND CONTRIBUTION
(a) The Offerors jointly and severally agree to indemnify and
hold harmless each Underwriter and each of its partners, officers, directors,
and employees and each person, if any, who controls any Underwriter within the
meaning of the 1933 Act or the 1934 Act against any losses, claims, damages or
liabilities, and any action in respect thereof (including, but not limited to,
any loss, claim, damage, liability or action relating to purchases and sales of
the Preferred Securities), joint or several, which arises out of, or is based
upon, (i) any untrue statement or alleged untrue statement of a material fact
contained in (A) the Registration Statement, or any amendment or supplement
thereto, including information deemed to be part of the Registration Statement
pursuant to Rule 430A(b) of the 1933 Act Regulations, if applicable, (B) the
Prospectus and any amendment or supplement thereto, or (C) any application or
other document, any amendment or supplement thereto, executed by the Offerors or
based upon information furnished by or on behalf of the Offerors filed in any
jurisdiction in order to qualify the Preferred Securities under the securities
or blue sky laws thereof (each, an "Application") or (ii) the omission or
alleged omission to state in the Registration Statement, or any amendment or
supplement thereto, the Prospectus or any amendment or supplement thereto, or
any Application, a material fact required to be stated therein or necessary to
make the statements therein not misleading, and shall reimburse as incurred each
Underwriter and each such controlling person for any legal and other expenses
incurred in investigating or defending or preparing to defend against or
appearing as a third party witness in connection with any such loss, claim,
damage, liability or action; provided, however, that neither of the Offerors
shall be liable to any Underwriter in any such case to the extent that any such
loss, claim, damage or liability arises out of, or is based upon, any untrue
statement or alleged untrue statement made in the Prospectus, including any
amendment or supplement thereto, in reliance upon and in conformity with
information furnished in writing to the Offerors by or on behalf of such
Underwriter specifically for inclusion and actually included therein; and
provided further that, as to any Prospectus that has been amended or
supplemented as provided herein, this indemnity agreement shall not inure to the
benefit of any Underwriter, on account of any loss, claim, damage, liability or
action arising out of the sale of Preferred Securities to any person by such
Underwriter if (A) such Underwriter failed to send or give a copy of the final
Prospectus as so amended or supplemented to that person at or prior to the
confirmation of the sale of such Preferred Securities to such person in any case
where such delivery is required by the 1933 Act, and (B) the untrue statement or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact in any preliminary Prospectus was corrected in an
amendment or supplement thereto (but only if the sale to such person occurred
after the Offerors provided such Underwriter and the Underwriter received copies
of such amendment or supplement for distribution). This indemnity agreement will
be in addition to any liability which the Offerors may otherwise have.
(b) Each Underwriter, severally and not jointly, will
indemnify and hold harmless the Company, the Trust, the Trustees and each of the
Company's directors, each of its officers and each person, if any, who controls
the Company or the Trust within the meaning of the 1933 Act or the 1934 Act, to
the same extent as the foregoing indemnity from the Offerors to each
Underwriter, but only with reference to written information relating to such
Underwriter furnished
-26-
<PAGE>
to the Offerors by such Underwriter and specifically included in the
Prospectus. This indemnity shall be in addition to any liability which such
Underwriter may otherwise have. The Offerors acknowledge that the statements
set forth in the penultimate paragraph of the cover page (p. S-3) and under
the heading "Underwriting" or "Plan of Distribution" in the Prospectus
constitute the only information furnished in writing by the several
Underwriters for inclusion in the Prospectus.
(c) Promptly after receipt by an indemnified party under this
Section 7 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against one or more
indemnifying parties under this Section 7, notify such indemnifying party or
parties of the commencement thereof; but the omission so to notify the
indemnifying party or parties will not relieve it or them from any liability
which it or they may have to any indemnified party otherwise than under
subsection (a) or (b) of this Section 7 or to the extent that the indemnifying
party was not adversely affected by such omission. In case any such action is
brought against an indemnified party and it notifies an indemnifying party or
parties of the commencement thereof, the indemnifying party or parties against
which a claim is to be made will be entitled to participate therein and, to the
extent that it or they may wish, to assume the defense thereof, with counsel
reasonably satisfactory to such indemnified party; provided, however, that if
the defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that there may be one or more legal defenses available to it and/or other
indemnified parties which are different from or additional to those available to
the indemnifying party, the indemnifying party shall not have the right to
direct the defense of such action on behalf of such indemnified party or parties
and such indemnified party or parties shall have the right to select separate
counsel to defend such action on behalf of such indemnified party or parties.
After notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof and approval by such indemnified party
of counsel appointed to defend such action, the indemnifying party will not be
liable to such indemnified party under this Section 7 for any legal or other
expenses, other than reasonable costs of investigation, subsequently incurred by
such indemnified party in connection with the defense thereof, unless (i) the
indemnified party shall have employed separate counsel in accordance with the
proviso to the next preceding sentence (it being understood, however, that in
connection with such action the indemnifying party shall not be liable for the
expenses of more than one separate counsel (in addition to local counsel) in any
one action or separate but substantially similar actions in the same
jurisdiction arising out of the same general allegations or circumstances,
designated by the lead Underwriter in the case of paragraph (a) of this Section
7, representing the indemnified parties under such paragraph (a) who are parties
to such action or actions), or (ii) the indemnifying party has authorized in
writing the employment of counsel for the indemnified party at the expense of
the indemnifying party. After such notice from the indemnifying party to such
indemnified party, the indemnifying party will not be liable for the costs and
expenses of any settlement of such action effected by such indemnified party
without the consent of the indemnifying party, which will not be unreasonably
withheld, unless such indemnified party waived its rights under this Section 7
in writing in which case the indemnified party may effect such a settlement
without such consent.
-27-
<PAGE>
(d) The Company agrees to indemnify the Trust against all
losses, claims, damages or liabilities due from the Trust under Section 7(a)
hereof.
(e) If the indemnification provided for in the preceding
paragraphs of this Section 7 is unavailable or insufficient to hold harmless an
indemnified party under paragraph (a) or (b) above in respect of any losses,
claims, damages or liabilities (or actions in respect thereof) referred to
therein, then the Offerors or the Underwriters shall contribute to the aggregate
losses, claims, damages and liabilities (including legal or other expenses
reasonably incurred in connection with investigating or defending same) to which
the Offerors and one or more of the Underwriters may be subject in such
proportion so that the Underwriters are responsible for that portion represented
by the percentage that the total discounts and/or commissions received by the
Underwriters bears to the sum of such discounts and/or commissions and the
purchase price of the Preferred Securities specified in Schedule B hereto and
the Offerors are responsible for the balance; provided, however, that (y) in no
case shall any Underwriter (except as may be provided in any agreement among
Underwriters relating to the offering of the Preferred Securities) be
responsible for any amount in excess of the total discounts and/or commissions
received by it with respect to the Preferred Securities purchased by such
Underwriter under this Agreement and (z) no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 7, each person who controls an
Underwriter within the meaning of the 1933 Act shall have the same rights to
contribution as such Underwriter, and each person who controls either of the
Offerors within the meaning of either the 1933 Act or the 1934 Exchange Act,
each officer or trustee of the Offerors who shall have signed the Registration
Statement and each director or trustee of the Offerors shall have the same
rights to contribution as the Offerors, subject in each case to clause (y) of
this paragraph (e). 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 paragraph (e), notify such party or parties from
whom contribution may be sought, but the omission to so notify such party or
parties 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 paragraph (d).
SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY. All representations, warranties and agreements contained in this
Agreement, or contained in certificates of officers or Trustees of the Offerors
submitted pursuant hereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of any Underwriter or
controlling person, or by or on behalf of the Offerors and shall survive
delivery of the Preferred Securities to the Underwriters.
SECTION 9. TERMINATION OF AGREEMENT.
(a) The Representatives may terminate this Agreement, by
notice to the Offerors, at any time at or prior to Closing Time or the Option
Closing Time (i) if there has been, since the date of this Agreement or since
the respective dates as of which information is given in
-28-
<PAGE>
the Registration Statement, any material adverse change in the condition,
financial or otherwise, or in the earnings or business affairs of the Trust
or the Company and its subsidiaries, considered as one enterprise, whether
or not arising in the ordinary course of business, or (ii) if there has
occurred any material adverse change in the financial markets in the United
States or elsewhere or any outbreak of hostilities or escalation thereof or
other calamity or crisis or any change or development involving a
prospective change in national or international political, financial or
economic conditions, in each case the effect of which is such as to make it,
in the judgment of the Representatives, impracticable to market the
Preferred Securities or to enforce contracts for the sale of the Preferred
Securities, or (iii) if trading in any securities of the Company or the
Trust has been suspended or materially limited by the Commission or the
applicable exchange, or if trading generally on the New York Stock Exchange,
the American Stock Exchange or on the NASDAQ National Market, has been
suspended, limited or restricted or minimum or maximum prices for trading
have been fixed, or maximum ranges for prices for securities have been
required, by said exchanges or such system or by order of the Commission,
the NASD or any governmental authority, or (iv) if a banking moratorium has
been declared by either Federal, New York, North Carolina or Delaware
authorities, or (v) if there has been any decrease in the ratings of any of
the securities of the Company or of the Preferred Securities by any
"nationally recognized statistical rating organization" (as defined for
purposes of Rule 436(g) under the Act) or if any such organization shall
have publicly announced that it has under surveillance or review its rating
of any of the Company's securities or any of the Preferred Securities.
(b) If this Agreement is terminated pursuant to this Section,
such termination shall be without liability of any party to any other party
except as provided in Section 4 hereof, and except that Sections 1, 7, and 8
shall survive any such termination and will remain in full force and effect.
SECTION 10. DEFAULT BY ONE OR MORE OF THE UNDERWRITERS. If one or more
of the Underwriters shall fail at Closing Time or the Option Closing Time to
purchase the Preferred Securities or the Option Preferred Securities, as the
case may be, that it or they are obligated to purchase under this Agreement (the
"Defaulted Securities"), the Representatives shall have the right, within 24
hours thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not less than all,
of the Defaulted Securities in such amounts as may be agreed upon and upon the
terms herein set forth; if, however, the Representatives shall not have
completed such arrangements within such 24-hour period, then:
(a) if the number of Defaulted Securities does not exceed 10%
of the Preferred Securities or the Option Preferred Securities, as the
case may be, each of the non-defaulting Underwriters shall be
obligated, severally and not jointly, to purchase the full amount
thereof in the proportions that their respective underwriting
obligations hereunder bear to the underwriting obligations of all
non-defaulting Underwriters, or
-29-
<PAGE>
(b) if the number of Defaulted Securities exceeds 10% of the
Preferred Securities or the Option Preferred Securities, as the case
may be, this Agreement shall terminate without liability on the part of
any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve any
defaulting Underwriter from liability in respect of its default.
In the event of any such default which does not result in a
termination of this Agreement, either the Representatives or the Offerors shall
have the right to postpone Closing Time or the Option Closing Time, as the case
may be, for a period not exceeding seven days in order to effect any required
changes in the Registration Statement or Prospectus or in any other documents or
arrangements.
SECTION 11. NOTICES. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to the Representatives at Merrill Lynch World
Headquarters, North Tower, World Financial Center, New York, New York 10281-
1201, attention of Louis J. Wolfe, Managing Director; notices to the Trust, and
the Company shall be directed to them at NationsBank Corporation, NationsBank
Corporate Center, 100 North Tryon Street, Charlotte, N.C. 28255, attention of
John E. Mack, Senior Vice President and Treasurer.
SECTION 12. PARTIES. This Agreement shall inure to the benefit of and
be binding upon the Underwriters and the Trust, the Company and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
Underwriters and the Trust and the Company and their respective successors and
the controlling persons and officers, directors and trustees referred to in
Sections 6 and 7 and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and exclusive benefit of the Underwriters
and the Trust and the Company and their respective successors, and said
controlling persons and officers, directors and trustees and their heirs and
legal representatives, and for the benefit of no other person, firm or
corporation. No purchaser of Preferred Securities from any Underwriter shall be
deemed to be a successor by reason merely of such purchase.
SECTION 13. GOVERNING LAW AND TIME. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York applicable to
agreements made and to be performed in said State. Except as otherwise set forth
herein, specified times of day refer to New York City time.
SECTION 14. COUNTERPARTS. This Agreement may be executed by any one or
more of the parties hereto in any number of counterparts, each of which shall be
deemed to be an original, but all such respective counterparts shall together
constitute one and the same instrument.
- 30 -
<PAGE>
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to the Trust a counterpart hereof,
whereupon this instrument, along with all counterparts, will become a binding
agreement between the Underwriters and the Trust and the Company in accordance
with its terms.
Very truly yours,
NATIONSBANK CORPORATION
By: /s/ SUSAN Y. CALTON
Title: Vice President
NB CAPITAL TRUST I
By: /s/ JOHN E. MACK
Title: Regular Trustee
CONFIRMED AND ACCEPTED, as of the date first above written:
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated,
Dean Witter Reynolds Inc.,
A.G. Edwards & Sons, Inc.,
PaineWebber Incorporated,
Prudential Securities Incorporated,
Smith Barney Inc.
By: Merrill Lynch, Pierce, Fenner & Smith
Incorporated
By: /s/ HENRY P. MICHAELS
Authorized Signatory
For themselves and as Representatives of the other
Underwriters named in Schedule A hereto.
- 31 -
<PAGE>
SCHEDULE A
NUMBER OF INITIAL NUMBER OF OPTION
NAME OF UNDERWRITER PREFERRED SECURITIES PREFERRED SECURITIES
Merrill Lynch, Pierce, Fenner & Smith
Incorporated........................ 2,770,000 415,500
Dean Witter Reynolds Inc.............. 2,770,000 415,500
A.G. Edwards & Sons, Inc.............. 2,770,000 415,500
PaineWebber Incorporated.............. 2,770,000 415,500
Prudential Securities
Incorporated......................... 2,770,000 415,500
Smith Barney Inc...................... 2,770,000 415,500
Bear, Stearns & Co. Inc. ............. 240,000 36,000
Alex, Brown & Sons Incorporated 240,000 36,000
Cowen & Company....................... 240,000 36,000
Dain Bosworth Incorporated............ 240,000 36,000
Dillon, Read & Co. Inc. .............. 240,000 36,000
EVEREN Securities, Inc. .............. 240,000 36,000
Interstate/Johnson Lane Corporation 240,000 36,000
The Ohio Company...................... 240,000 36,000
Oppenheimer & Co., Inc. .............. 240,000 36,000
Piper Jaffray Inc. ................... 240,000 36,000
Raymond James & Associates, Inc. 240,000 36,000
The Robinson-Humphrey Company,
Inc. ................................ 240,000 36,000
Stephens Inc. ........................ 240,000 36,000
Tucker Anthony Incorporated 240,000 36,000
Wheat, First Securities, Inc. 240,000 36,000
Advest, Inc. ......................... 140,000 21,000
Robert W. Baird & Co. Incorporated 140,000 21,000
J.C. Bradford & Co. .................. 140,000 21,000
Davenport & Co. of Virginia, Inc. 140,000 21,000
Fahnestock & Co. Inc. ................ 140,000 21,000
Gilbraltar Securities Co. ............ 140,000 21,000
Gruntal & Co., Incorporated 140,000 21,000
J.J.B. Hilliard, W.L. Lyons, Inc. 140,000 21,000
Janney Montgomery Scott Inc. 140,000 21,000
Josephthal Lyon & Ross Incorporated 140,000 21,000
Kennedy, Cabot & Co. ................. 140,000 21,000
Legg Mason Wood Walker,
Incorporated......................... 140,000 21,000
McDonald & Company Securities,
Inc. ................................ 140,000 21,000
McGinn, Smith & Co., Inc. ............ 140,000 21,000
<PAGE>
NUMBER OF INITIAL NUMBER OF OPTION
NAME OF UNDERWRITER PREFERRED SECURITIES PREFERRED SECURITIES
Mesirow Financial, Inc. .............. 140,000 21,000
Morgan Keegan & Company, Inc. 140,000 21,000
Olde Discount Corporation............. 140,000 21,000
Principal Financial Securities, Inc. 140,000 21,000
Pryor, McClendon, Counts &
Co., Inc. ........................... 140,000 21,000
Rauscher Pierce Refsnes, Inc. 140,000 21,000
Roney & Co., LLC...................... 140,000 21,000
Scott & Stringfellow, Inc. 140,000 21,000
Stifel, Nicolaus & Company, 140,000
Incorporated......................... 21,000
Stone & Youngberg..................... 140,000 21,000
Sturdivant & Co., Inc. ............... 140,000 21,000
US Clearing Corp. .................... 140,000 21,000
Utendahl Capital Partners, L.P. 140,000 21,000
-----------------------------------------
Total............................ 24,000,000 3,600,000
=========================================
<PAGE>
SCHEDULE B
Underwriting Agreement dated November 27, 1996
Registration Statement No. 333-15375
Representatives: Merrill Lynch, Pierce, Fenner & Smith
Incorporated,
Dean Witter Reynolds Inc.,
A.G. Edwards & Sons, Inc.,
PaineWebber Incorporated,
Prudential Securities Incorporated,
Smith Barney Inc.
Address of Representatives: c/o Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Merrill Lynch World Headquarters
North Tower
World Financial Center
New York, New York 10281
Title, Purchase Price and Description of Securities:
Title: 7.84% Trust Originated Preferred Securities
1. The initial public offering price per security for the
Preferred Securities, determined as provided in said Section 2, shall
be $25.00.
2. The purchase price per security for the Preferred
Securities to be paid by the several Underwriters shall be $25.00,
being an amount equal to the initial public offering price set forth
above, plus, in the case of Option Preferred Securities, any accrued
distributions thereon.
3. The compensation per Preferred Securities to be paid by the
Company to the several Underwriters in respect of their commitments
hereunder shall be $0.7875.
<PAGE>
This Preferred Security is a Global Certificate within the
meaning of the Declaration hereinafter referred to and is registered in the name
of The Depository Trust Company (the "Depositary") or a nominee of the
Depositary. This Preferred Security is exchangeable for Preferred Securities
registered in the name of a person other than the Depositary or its nominee only
in the limited circumstances described in the Declaration and no transfer of
this Preferred Security (other than a transfer of this Preferred Security as a
whole by the Depositary to a nominee of the Depositary or by a nominee of the
Depositary to the Depositary or another nominee of the Depositary) may be
registered except in limited circumstances.
Unless this Preferred Security is presented by an authorized
representative of The Depository Trust Company (55 Water Street, New York, New
York) to the Trust or its agent for registration of transfer, exchange or
payment, and any Preferred Security issued is registered in the name of Cede &
Co. or such other name as requested by an authorized representative of The
Depository Trust Company and any payment hereon is made to Cede & Co., ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS
WRONGFUL since the registered owner hereof, Cede & Co., has an interest herein.
THIS INSTRUMENT IS NOT A SAVINGS ACCOUNT OR A BANK DEPOSIT, IS NOT AN OBLIGATION
OF OR GUARANTEED BY ANY BANKING OR NONBANKING AFFILIATE OF NATIONSBANK
CORPORATION (EXCEPT TO THE EXTENT THAT IT IS GUARANTEED BY NATIONSBANK
CORPORATION AS DESCRIBED HEREIN) AND IS NOT INSURED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.
Certificate Number R-1
CUSIP NO. 628956 20 3
Certificate Evidencing 8,000,000 Preferred Securities
of
NB CAPITAL TRUST I
7.84% Trust Originated Preferred SecuritiesSM ("TOPrS"SM)
(liquidation amount $25 per Preferred Security)
NB CAPITAL TRUST I, a statutory business trust formed under
the laws of the State of Delaware (the "Trust"), hereby
- --------
(SM) "Trust Originated Preferred Securities" and "TOPrS" are service marks
of Merrill Lynch & Co., Inc.
<PAGE>
certifies that CEDE & CO. (the "Holder") is the registered owner of 8,000,000
preferred securities of the Trust representing undivided beneficial interests in
the assets of the Trust designated the 7.84% Trust Originated Preferred
SecuritiesSM (liquidation amount $25 per Preferred Security) (the "Preferred
Securities"). The Preferred Securities are transferable on the books and records
of the Trust, in person or by a duly authorized attorney, upon surren der of
this certificate duly endorsed and in proper form for transfer. The
designation, rights, privileges, restrictions, prefer ences and other terms and
provisions of the Preferred Securities represented hereby are issued and shall
in all respects be subject to the provisions of the Amended and Restated
Declaration of Trust of the Trust dated as of November 27, 1996, as the same may
be amended from time to time (the "Declaration"), including the designation of
the terms of the Preferred Securities as set forth in Annex I to the
Declaration. Capitalized terms used herein but not defined shall have the
meaning given them in the Declaration. The Holder is entitled to the benefits of
the Preferred Securities Guarantee to the extent provided therein. The
Declaration permits the Sponsor to dissolve the Trust at any time. The Sponsor
will provide a copy of the Declaration, the Preferred Securities Guarantee and
the Indenture to a Holder without charge upon written request to the Trust at
its principal place of business.
Upon receipt of this certificate, the Holder is bound by the
Declaration and is entitled to the benefits thereunder.
By acceptance, the Holder agrees to treat, for United States
federal income tax purposes, the Notes as indebtedness and the Preferred
Securities as evidence of indirect beneficial ownership in the Notes.
IN WITNESS WHEREOF, the Trust has executed this certificate
this 4th day of December, 1996.
NB CAPITAL TRUST I
By:________________________________
Name: John E. Mack
Title: Regular Trustee
2
<PAGE>
[REVERSE OF PREFERRED SECURITY]
Distributions payable on each Preferred Security will be fixed
at a rate per annum of 7.84% (the "Coupon Rate") of the stated liquidation
amount of $25 per Preferred Security, such rate being the rate of interest
payable on the Notes to be held by the Property Trustee. Distributions in
arrears for more than one quarter will bear interest thereon compounded
quarterly at the Coupon Rate (to the extent permitted by applicable law). The
term "Distributions" as used herein includes such cash distributions and any
such interest payable unless otherwise stated. A Distribution is payable only to
the extent that payments are made in respect of the Notes held by the Property
Trustee and to the extent the Property Trustee has funds available therefor. The
amount of Distributions payable for any period will be computed for any full
quarterly Distribution period on the basis of a 360-day year of twelve 30-day
months, and for any period shorter than a full quarterly Distribution period for
which Distributions are computed, Distributions will be computed on the basis of
the actual number of days elapsed per 30-day month.
Except as otherwise described below, distributions on the
Preferred Securities will be cumulative, will accrue from the date of original
issuance and will be payable quarterly in arrears, on March 31, June 30,
September 30 and December 31 of each year, commencing on December 31, 1996, to
the person in whose name this Preferred Security is registered at the close of
business on the regular record date for such installment, which shall be the
close of business on the business day next preceding such payment date. [IF
PURSUANT TO THE TERMS OF THE DECLARATION, THE SECURITIES ARE NO LONGER
REPRESENTED BY A GLOBAL SECURITY -- which shall be the close of business on
March 15, June 15, September 15 or December 15,] The Note Issuer has the right
under the Indenture to defer payments of interest by extending the interest
payment period from time to time on the Notes for a period not exceeding 20
consecutive quarters (each an "Extension Period"), provided that no Extension
Period shall last beyond the date of the maturity of the Notes. As a consequence
of such deferral, Distributions will also be deferred hereunder for the same
period. Despite such deferral, quarterly Distributions will continue to accrue
with interest thereon (to the extent permitted by applicable law) at the Coupon
Rate compounded quarterly during any such Extension Period. Prior to the
termination of any such Extension Period, the Note Issuer may further extend
such Extension Period; provided that such Extension Period together with all
such previous and further extensions thereof may not exceed 20 consecutive
quarters or extend beyond the maturity of the Notes. Payments of accrued
Distributions will be payable to Holders as they appear on the books and records
of the Trust on the first record date after the end of the Extension Period.
Upon the termination of any Extension Period and the payment of all amounts
then due, the Note Issuer may commence a new Extension Period, subject to the
above requirements.
THE PREFERRED SECURITIES SHALL BE REDEEMABLE AS PROVIDED
IN THE DECLARATION.
3
<PAGE>
---------------------
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned assigns and transfers this Preferred
Security Certificate to:
=================================================================
- -----------------------------------------------------------------
(Insert assignee's social security or tax identification number)
=================================================================
=================================================================
(Insert address and zip code of assignee)
and irrevocably appoints
=================================================================
___________________________________________________________ agent to transfer
this Preferred Security 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 Preferred Security
Certificate)
Signature Guarantee*: ___________________________________
- --------
* Signature must be guaranteed by an "eligible guarantor
institution" that is a bank, stockbroker, savings and loan
association or credit union meeting the requirements of the
Registrar, which requirements include membership or partici-
pation in the Securities Transfer Agents Medallion Program
("STAMP") or such other "signature guarantee program" as may
be determined by the Registrar in addition to, or in substi-
tution for, STAMP, all in accordance with the Securities and
Exchange Act of 1934, as amended.
4
====================================
FIRST SUPPLEMENTAL INDENTURE
between
NATIONSBANK CORPORATION
and
THE BANK OF NEW YORK
Dated as of December 4, 1996
=====================================
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
ARTICLE I
DEFINITIONS
SECTION 1.1 Definition of Terms....................................................................2
ARTICLE II
GENERAL TERMS AND CONDITIONS OF THE NOTES
SECTION 2.1 Designation and Principal Amount.......................................................3
SECTION 2.2 Maturity...............................................................................4
SECTION 2.3 Form and Payment.......................................................................4
SECTION 2.4 Global Form............................................................................4
SECTION 2.5 Interest...............................................................................6
ARTICLE III
REDEMPTION OF THE NOTES
SECTION 3.1 Tax Event Redemption...................................................................7
SECTION 3.2 Optional Redemption by Company.........................................................7
SECTION 3.3 No Sinking Fund........................................................................8
ARTICLE IV
EXTENSION OF INTEREST PAYMENT PERIOD
SECTION 4.1 Extension of Interest Payment Period...................................................8
SECTION 4.2 Notice of Extension....................................................................9
Section 4.3 Limitation of Transactions.............................................................9
ARTICLE V
EXPENSES
SECTION 5.1 Payment of Expenses...................................................................10
Section 5.2 Payment Upon Resignation or Removal...................................................11
ARTICLE VI
COVENANT TO LIST ON EXCHANGE
SECTION 6.1 Listing on an Exchange................................................................11
ARTICLE VII
FORM OF NOTE
SECTION 7.1 Form of Note..........................................................................11
ARTICLE VIII
ORIGINAL ISSUE OF NOTES
SECTION 8.1 Original Issue of Notes...............................................................18
i
<PAGE>
Page
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Ratification of Indenture.............................................................19
SECTION 9.2 Trustee Not Responsible for Recitals..................................................19
SECTION 9.3 Governing Law.........................................................................19
SECTION 9.4 Separability..........................................................................19
SECTION 9.5 Counterparts..........................................................................19
</TABLE>
ii
<PAGE>
FIRST SUPPLEMENTAL INDENTURE
THIS FIRST SUPPLEMENTAL INDENTURE, dated as of December 4,
1996 (the "First Supplemental Indenture"), between NATIONSBANK CORPORATION, a
North Carolina corporation (the "Company"), and THE BANK OF NEW YORK, as
trustee, (the "Trustee") under the Indenture dated as of November 27, 1996
between the Company and the Trustee (the "Indenture").
WHEREAS, the Company executed and delivered the Indenture to
the Trustee to provide for the issuance of the Company's unsecured junior
subordinated debt securities to be issued from time to time in one or more
series as might be determined by the Company under the Indenture, in an
unlimited aggregate principal amount which may be authenticated and delivered as
provided in the Indenture;
WHEREAS, pursuant to the terms of the Indenture, the Company
desires to provide for the establishment of a series of its Securities to be
known as its 7.84% Junior Subordinated Deferrable Interest Notes due 2026 (the
"Notes"), the form and substance of such Notes and the terms, provisions and
conditions thereof to be set forth as provided in the Indenture and this First
Supplemental Indenture;
WHEREAS, under the terms of an Underwriting Agreement dated as
of November 27, 1996 (the "Underwriting Agreement"), among the Company and NB
Capital Trust I (the "Trust") and the Underwriters named therein (the
"Underwriters"), the Trust has agreed to sell to the Underwriters $600,000,000
aggregate liquidation amount of its 7.84% Trust Originated Preferred Securities
(the "Preferred Securities") and has granted the Underwriters an option to
purchase up to an additional $90,000,000 aggregate liquidation amount of
Preferred Securities (the "Option");
WHEREAS, under the terms of a Subscription Agreement dated as
of November 27, 1996 between the Trust and the Company (the "Subscription
Agreement"), the Company has committed to purchase all of the Trust Originated
Common Securities ("Common Securities") from the Trust which Common Securities
represent at least 3% of the capital of the Trust;
WHEREAS, the Trust proposes to invest the proceeds from such
offering, together with the proceeds of the issuance and sale by the Trust to
the Company of Common Securities, in Notes, as a result of which the Trust will
initially purchase $618,560,000 aggregate principal amount of the Notes, and
may, upon exercise of the Option purchase up to an additional
<PAGE>
$92,790,000 aggregate principal amount of the Notes (the
"Additional Notes"); and
WHEREAS, the Company has requested that the Trustee execute
and deliver this First Supplemental Indenture, and all requirements necessary to
make this First Supplemental Indenture a valid instrument in accordance with its
terms, and to make the Notes, when executed by the Company and authenticated and
delivered by the Trustee, the valid obligations of the Company, have been
performed, and the execution and delivery of this First Supplemental Indenture
have been duly authorized in all respects:
NOW THEREFORE, in consideration of the purchase and acceptance
of the Notes by the Holders thereof, and for the purpose of setting forth, as
provided in the Indenture, the form and substance of the Notes and the terms,
provisions and conditions thereof, the Company covenants and agrees with the
Trustee as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 Definition of Terms.
Unless the context otherwise requires:
(a) a term defined in the Indenture has the same
meaning when used in this First Supplemental Indenture;
(b) a term defined anywhere in this First Supplemental
Indenture has the same meaning throughout;
(c) the singular includes the plural and vice versa;
(d) a reference to a Section or Article is to a
Section or Article of this First Supplemental Indenture;
(e) headings are for convenience of reference only and
do not affect interpretation;
(f) the following terms have the meanings given to
them in the Declaration: (i) Business Day; (ii) Clearing Agency;
(iii) Delaware Trustee; (iv) Depositary; (v) No Recognition
Opinion; (vi) Preferred Security Certificate; (vii) Property
Trustee; (viii) Regular Trustees; (ix) Tax Event; and (x)
Underwriting Agreement;
2
<PAGE>
(g) the following terms have the meanings given to
them in this Section 1.1(g):
"Additional Interest" shall have the meaning set forth
in Section 2.5.
"Compounded Interest" shall have the meaning set forth
in Section 4.1.
"Declaration" means the Amended and Restated Declaration of
Trust of NB Capital Trust I, a Delaware statutory business trust, dated as of
November 27, 1996.
"Deferred Interest" shall have the meaning set forth in
Section 4.1.
"Dissolution Election" means that, as a result of the election
of the Company, as Sponsor, the Trust is to be dissolved in accordance with the
Declaration, and the Notes held by the Property Trustee are to be distributed to
the holders of the Trust Securities issued by the Trust pro rata in accordance
with the Declaration.
"Extended Interest Payment Period" shall have the meaning set
forth in Section 4.1.
"Global Note" shall have the meaning set forth in
Section 2.4.
"Maturity Date" means the date on which the Notes mature and
on which the principal shall be due and payable together with all accrued and
unpaid interest thereon, including Compounded Interest and Additional Interest,
if any.
"Non-Book-Entry Preferred Securities" shall have the
meaning set forth in Section 2.4.
"Optional Redemption Price" shall have the meaning set
forth in Section 3.2.
ARTICLE II
GENERAL TERMS AND CONDITIONS OF THE NOTES
SECTION 2.1 Designation and Principal Amount.
There is hereby authorized a series of Securities designated
the "7.84% Junior Subordinated Deferrable Interest Notes due 2026", limited in
aggregate principal amount to $711,350,000, which amount shall be as set forth
in any written order of the Company for the authentication and delivery of Notes
3
<PAGE>
pursuant to Section 2.04 of the Indenture as well as in any subsequent or
supplemental written order of the Company upon the exercise of the Option.
SECTION 2.2 Maturity.
The Maturity Date is December 31, 2026.
SECTION 2.3 Form and Payment.
Except as provided in Section 2.4, the Notes shall be issued
in fully registered certificated form without interest coupons. Principal and
interest on the Notes issued in certificated form will be payable, the transfer
of such Notes will be registrable and such Notes will be exchangeable for Notes
bearing identical terms and provisions at the office or agency of the Trustee;
provided, however, that payment of interest may be made at the option of the
Company by check mailed to the Holder at such address as shall appear in the
Security Register. Notwithstanding the foregoing, so long as the Holder of any
Notes is the Property Trustee, the payment of the principal of and interest
(including Compounded Interest and Additional Interest, if any) on such Notes
held by the Property Trustee will be made at such place and to such account as
may be designated by the Property Trustee.
SECTION 2.4 Global Form
(a) In connection with a Dissolution Election,
(i) the Notes in certificated form may be
presented to the Trustee by the Property Trustee in exchange for a Global Note
in an aggregate principal amount equal to the aggregate principal amount of all
then outstanding Notes (a "Global Note"), to be registered in the name of the
Depositary, or its nominee, and delivered by the Trustee to the Depositary for
crediting to the accounts of its participants pursuant to the instructions of
the Regular Trustees. Upon any such presentation, the Company shall execute a
Global Note in such aggregate principal amount and deliver the same to the
Trustee for authentication and delivery in accordance with the Indenture and
this First Supplemental Indenture. Payments on the Notes issued as a Global Note
will be made to the Depositary; and
(ii) if any Preferred Securities are held in Non-
Book-Entry certificated form, the Notes in certificated form may be presented to
the Trustee by the Property Trustee and any Preferred Security Certificate which
represents Preferred Securities other than Preferred Securities held by the
Clearing Agency or its nominee ("Non-Book-Entry Preferred Securities") will be
deemed to represent beneficial interests in Notes
4
<PAGE>
presented to the Trustee by the Property Trustee having an aggregate principal
amount equal to the aggregate liquidation amount of the Non-Book-Entry Preferred
Securities until such Preferred Security Certificates are presented to the
Security Registrar for transfer or reissuance at which time such Preferred
Security Certificates will be canceled and a Note, registered in the name of the
holder of the Preferred Security Certificate or the transferee of the holder of
such Preferred Security Certificate, as the case may be, with an aggregate
principal amount equal to the aggregate liquidation amount of the Preferred
Security Certificate canceled, will be executed by the Company and delivered to
the Trustee for authentication and delivery in accordance with the Indenture and
this First Supplemental Indenture. On issue of such Notes, Notes with an
equivalent aggregate principal amount that were presented by the Property
Trustee to the Trustee will be deemed to have been canceled.
(b) A Global Note may be transferred, in whole but not in
part, only to another nominee of the Depositary, or to a successor Depositary
selected or approved by the Company or to a nominee of such successor
Depositary.
(c) If at any time the Depositary notifies the Company that it
is unwilling or unable to continue as Depositary or if at any time the
Depositary for such series shall no longer be registered or in good standing
under the Securities Exchange Act of 1934, as amended, or other applicable
statute or regulation, and a successor Depositary for such series is not
appointed by the Company within 90 days after the Company receives such notice
or becomes aware of such condition, as the case may be, the Company will
execute, and, subject to Article II of the Indenture, the Trustee, upon written
notice from the Company, will authenticate and make available for delivery the
Notes in definitive registered form without coupons, in authorized
denominations, and in an aggregate principal amount equal to the principal
amount of the Global Note in exchange for such Global Note. In addition, the
Company may at any time determine that the Notes shall no longer be represented
by a Global Note. In such event the Company will execute, and subject to Section
2.07 of the Indenture, the Trustee, upon receipt of an Officers' Certificate
evidencing such determination by the Company, will authenticate and deliver the
Notes in definitive registered form without coupons, in authorized
denominations, and in an aggregate principal amount equal to the principal
amount of the Global Note in exchange for such Global Note. Upon the exchange of
the Global Note for such Notes in definitive registered form without coupons, in
authorized denominations, the Global Note shall be canceled by the Trustee. Such
Notes in definitive registered form issued in exchange for the Global Note shall
be registered in such names and in such authorized denominations as the
Depositary, pursuant to instructions from its direct or indirect
5
<PAGE>
participants or otherwise, shall instruct the Trustee. The Trustee shall deliver
such Securities to the Depositary for delivery to the Persons in whose names
such Securities are so registered.
SECTION 2.5 Interest.
(a) Each Note will bear interest at the rate of 7.84% per
annum (the "Coupon Rate") from December 4, 1996 until the principal thereof
becomes due and payable, and on any overdue principal and (to the extent that
payment of such interest is enforceable under applicable law) on any overdue
installment of interest at the Coupon Rate, compounded quarterly, payable
(subject to the provisions of Article IV) quarterly in arrears on March 31, June
30, September 30 and December 31 of each year (each, an "Interest Payment Date,"
commencing on December 31, 1996), to the Person in whose name such Note or any
predecessor Note is registered, at the close of business on the regular record
date for such interest installment, which, in respect of any Notes of which the
Property Trustee is the Holder of a Global Note, shall be the close of business
on the Business Day next preceding that Interest Payment Date. Notwithstanding
the foregoing sentence, if the Preferred Securities are no longer in Book-Entry
only form, the relevant record dates shall be March 15, June 15, September 15
and December 15 prior to the regular Interest Payment Date.
(b) The amount of interest payable for any period will be
computed on the basis of a 360-day year of twelve 30-day months. Except as
provided in the following sentence, the amount of interest payable for any
period shorter than a full quarterly period for which interest is computed, will
be computed on the basis of the actual number of days elapsed in such a 30-day
period. In the event that any date on which interest is payable on the Notes is
not a Business Day, then payment of 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 such date.
(c) If, at any time while the Property Trustee is the Holder
of any Notes, the Trust or the Property Trustee is required to pay any taxes,
duties, assessments or governmental charges of whatever nature (other than
withholding taxes) imposed by the United States, or any other domestic taxing
authority, then, in any case, the Company will pay as additional interest
("Additional Interest") on the Notes held by the Property Trustee, such
additional amounts as shall be required so that the
6
<PAGE>
net amounts received and retained by the Trust and the Property Trustee after
paying such taxes, duties, assessments or other governmental charges will be
equal to the amounts the Trust and the Property Trustee would have received had
no such taxes, duties, assessments or other government charges been imposed.
ARTICLE III
REDEMPTION OF THE NOTES
SECTION 3.1 Tax Event Redemption.
If a Tax Event has occurred and is continuing prior to
December 31, 2001 the Company shall have the right upon not less than 30 days
nor more than 60 days notice to the Holders of the Notes to redeem the Notes, in
whole but not in part, for cash within 90 days following the occurrence of such
Tax Event (the "90 Day Period") at a redemption price equal to 100% of the
principal amount to be redeemed plus any accrued and unpaid interest thereon to
the date of such redemption (the "Redemption Price"), provided that if at the
time there is available to the Company the opportunity to eliminate, within the
90 Day Period, the Tax Event by taking some ministerial action ("Ministerial
Action"), such as filing a form or making an election, or pursuing some other
similar reasonable measure which has no adverse effect on the Company, the Trust
or the Holders of the Trust Securities issued by the Trust, the Company shall
pursue such Ministerial Action in lieu of redemption. The Redemption Price shall
be paid prior to 12:00 noon, New York time, on the date of such redemption or
such earlier time as the Company determines, provided that the Company shall
deposit with the Trustee an amount sufficient to pay the Redemption Price by
10:00 a.m., New York time, on the date such Redemption Price is to be paid.
SECTION 3.2 Optional Redemption by Company.
(a) Subject to the provisions of Section 3.2(b) and to the
provisions of Article Fourteen of the Indenture, the Company shall have the
right to redeem the Notes, in whole or in part, at any time and from time to
time, on or after December 31, 2001, at a redemption price equal to 100% of the
principal amount to be redeemed plus any accrued and unpaid interest thereon to
the date of such redemption (the "Optional Redemption Price"). Any redemption
pursuant to this paragraph will be made upon not less than 30 days nor more than
60 days notice to the Holder of the Notes, at the Optional Redemption Price. If
the Notes are only partially redeemed pursuant to this Section 3.2, the Notes
will be redeemed pro rata or by lot or by any other method utilized by the
Trustee; provided, that if at the time of redemption the Notes are registered as
a Global Note, the Depositary shall
7
<PAGE>
determine, in accordance with its procedures, the principal amount of such Notes
held by each Holder of Note to be redeemed. The Optional Redemption Price shall
be paid prior to 12:00 noon, New York time, on the date of such redemption or at
such earlier time as the Company determines provided that the Company shall
deposit with the Trustee an amount sufficient to pay the Optional Redemption
Price by 10:00 a.m., New York time, on the date such Optional Redemption Price
is to be paid.
(b) If a partial redemption of the Notes would result in the
delisting of the Preferred Securities issued by the Trust from any national
securities exchange or other organization on which the Preferred Securities are
then listed, the Company shall not be permitted to effect such partial
redemption and may only redeem the Notes in whole.
SECTION 3.3 No Sinking Fund.
The Notes are not entitled to the benefit of any sinking fund.
ARTICLE IV
EXTENSION OF INTEREST PAYMENT PERIOD
SECTION 4.1 Extension of Interest Payment Period.
------------------------------------
The Company shall have the right, at any time and from time to
time during the term of the Notes, to defer payments of interest by extending
the interest payment period of such Notes for a period not exceeding 20
consecutive quarters (the "Extended Interest Payment Period"), during which
Extended Interest Payment Period no interest shall be due and payable; provided
that no Extended Interest Payment Period may extend beyond the Maturity Date. To
the extent permitted by applicable law, interest, the payment of which has been
deferred because of the extension of the interest payment period pursuant to
this Section 4.1, will bear interest thereon at the Coupon Rate compounded
quarterly for each quarter of the Extended Interest Payment Period ("Compounded
Interest"). At the end of the Extended Interest Payment Period, the Company
shall pay all interest accrued and unpaid on the Notes, including any Additional
Interest and Compounded Interest (together, "Deferred Interest") that shall be
payable to the Holders of the Notes in whose names the Notes are registered in
the Security Register on the first record date after the end of the Extended
Interest Payment Period. Before the termination of any Extended Interest Payment
Period, the Company may further extend such period, provided that such period
together with all such further extensions thereof shall not exceed 20
consecutive quarters, or extend beyond the maturity date of the Notes. Upon the
termination of any Extended Interest Payment Period and upon
8
<PAGE>
the payment of all Deferred Interest then due, the Company may commence a new
Extended Interest Payment Period, subject to the foregoing requirements. No
interest shall be due and payable during an Extended Interest Payment Period,
except at the end thereof, but the Company may prepay at any time all or any
portion of the interest accrued during an Extended Interest Payment Period.
SECTION 4.2 Notice of Extension.
(a) If the Property Trustee is the only registered Holder of
the Notes at the time the Company selects an Extended Interest Payment Period,
the Company shall give written notice to the Regular Trustees, the Property
Trustee and the Trustee of its selection of such Extended Interest Payment
Period one Business Day before the earlier of (i) the next succeeding date on
which Distributions on the Trust Securities issued by the Trust are payable, or
(ii) the date the Trust is required to give notice of the record date, or the
date such Distributions are payable, to the New York Stock Exchange or other
applicable self-regulatory organization or to holders of the Preferred
Securities issued by the Trust, but in any event at least one Business Day
before such record date.
(b) If the Property Trustee is not the only Holder of the
Notes at the time the Company selects an Extended Interest Payment Period, the
Company shall give the Holders of the Notes and the Trustee written notice of
its selection of such Extended Interest Payment Period at least 10 Business Days
before the earlier of (i) the next succeeding Interest Payment Date, or (ii) the
date the Company is required to give notice of the record or payment date of
such interest payment to the New York Stock Exchange or other applicable
self-regulatory organization or to Holders of the Notes.
(c) The quarter in which any notice is given pursuant to
paragraphs (a) or (b) of this Section 4.2 shall be counted as one of the 20
quarters permitted in the maximum Extended Interest Payment Period permitted
under Section 4.1.
Section 4.3 Limitation of Transactions.
If (i) the Company shall exercise its right to defer payment
of interest as provided in Section 4.1, or (ii) there shall have occurred and be
continuing any Event of Default or Nonpayment, as defined in the Indenture, then
(a) the Company shall not declare or pay any dividend on, make any distributions
with respect to, or redeem, purchase, acquire or make a liquidation payment with
respect to, any of its capital stock or make any guarantee payment with respect
thereto (other than (i) purchases or acquisitions of shares of its common stock
in
9
<PAGE>
connection with the satisfaction by the Company of its obligations under any
employee benefit plans, (ii) as a result of a reclassification of its capital
stock for another class or series of its capital stock or (iii) the purchase of
fractional interests in shares of its capital stock pursuant to an acquisition
or the conversion or exchange provisions of such capital stock or security being
converted or exchanged) or make any guarantee payment with respect thereto and
(b) the Company shall not make any payment of interest, principal or premium, if
any, on or repay, repurchase or redeem any debt securities issued by the Company
which rank pari passu with or junior to the Notes.
ARTICLE V
EXPENSES
SECTION 5.1 Payment of Expenses.
In connection with the offering, sale and issuance of the
Notes to the Property Trustee and in connection with the sale of the Trust
Securities by the Trust, the Company, in its capacity as borrower with respect
to the Notes, shall:
(a) pay all costs and expenses relating to the offering, sale
and issuance of the Notes, including commissions to the underwriters payable
pursuant to the Underwriting Agreement and compensation of the Trustee under the
Indenture in accordance with the provisions of Section 6.06 of the Indenture;
(b) pay all costs and expenses of the Trust (including, but
not limited to, costs and expenses relating to the organization, maintenance and
dissolution of the Trust, the offering, sale and issuance of the Trust
Securities (including commissions to the underwriters in connection therewith),
the fees and expenses of the Property Trustee and the Delaware Trustee, the
costs and expenses relating to the operation of the Trust, including without
limitation, costs and expenses of accountants, attorneys, statistical or
bookkeeping services, expenses for printing and engraving and computing or
accounting equipment, paying agent(s), registrar(s), transfer agent(s),
duplicating, travel and telephone and other telecommunications expenses and
costs and expenses incurred in connection with the acquisition, financing, and
disposition of Trust assets);
(c) be primarily and fully liable for any
indemnification obligations arising with respect to the
Declaration; and
(d) pay any and all taxes (other than United States
withholding taxes attributable to the Trust or its assets) and all liabilities,
costs and expenses with respect to such taxes of the Trust.
10
<PAGE>
Section 5.2 Payment Upon Resignation or Removal.
-----------------------------------
Upon termination of this First Supplemental Indenture or the
Indenture or the removal or resignation of the Trustee, unless otherwise stated,
the Company shall pay to the Trustee all amounts accrued to the date of such
termination, removal or resignation. Upon termination of the Declaration or the
removal or resignation of the Delaware Trustee or the Property Trustee, as the
case may be, pursuant to Section 5.6 of the Declaration, the Company shall pay
to the Delaware Trustee or the Property Trustee, as the case may be, all amounts
accrued to the date of such termination, removal or resignation.
ARTICLE VI
COVENANT TO LIST ON EXCHANGE
SECTION 6.1 Listing on an Exchange.
If the Notes are to be issued as a Global Note in connection
with the distribution of the Notes to the holders of the Preferred Securities
issued by the Trust upon a Dissolution Election, the Company will use its best
efforts to list such Notes on the New York Stock Exchange, Inc. or on such other
exchange as the Preferred Securities are then listed.
ARTICLE VII
FORM OF NOTE
SECTION 7.1 Form of Note.
The Notes and the Trustee's Certificate of Authentication to
be endorsed thereon are to be substantially in the following forms:
(FORM OF FACE OF NOTE)
[IF THE NOTE IS TO BE A GLOBAL NOTE, INSERT - This Note is a
Global Note 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 Note
is exchangeable for Notes registered in the name of a person other than the
Depositary or its nominee only in the limited circumstances described in the
Indenture, and no transfer of this Note (other than a transfer of this Note as a
whole by the Depositary to a nominee of the Depositary or by a nominee of the
Depositary to the Depositary or another nominee of the Depositary) may be
registered except in limited circumstances.
11
<PAGE>
Unless this Note is presented by an authorized representative
of The Depository Trust Company (55 Water Street, New York, New York) to the
issuer or its agent for registration of transfer, exchange or payment, and any
Note issued is registered in the name of Cede & Co. or such other name as
requested by an authorized representative of The Depository Trust Company and
any payment hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL since the registered owner
hereof, Cede & Co., has an interest herein.]
THIS NOTE IS NOT A SAVINGS ACCOUNT OR A BANK DEPOSIT, IS NOT AN OBLIGATION OF OR
GUARANTEED BY ANY BANKING OR NONBANKING AFFILIATE OF NATIONSBANK CORPORATION AND
IS NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER
GOVERNMENTAL AGENCY.
No. CUSIP No. ___________
NATIONSBANK CORPORATION
____% JUNIOR SUBORDINATED DEFERRABLE INTEREST NOTE
DUE 2026
NATIONSBANK CORPORATION, a North Carolina corporation (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 December __, 2026(the "Maturity Date"), and to pay interest on
said principal sum from December __, 1996, or from the most recent interest
payment date (each such date, an "Interest Payment Date") to which interest has
been paid or duly provided for, quarterly (subject to deferral as set forth
herein) in arrears on March 31, June 30, September 30 and December 31 of each
year commencing _______, 199_, at the rate of ____% per annum until the
principal hereof shall have become due and payable, and on any overdue principal
and premium, if any, and (without duplication and to the extent that payment of
such interest is enforceable under applicable law) on any overdue installment of
interest at the same rate per annum compounded quarterly. The amount of interest
payable on any Interest Payment Date shall be computed on the basis of a 360-day
year of twelve 30-day months. In the event that any date on which interest is
payable on this Note is not a Business Day, then payment of interest payable on
such date will be made on the next succeeding day that is a Business Day (and
without any interest
12
<PAGE>
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 such date. 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 Note (or one or more
Predecessor Securities, as defined in said Indenture) is registered at the close
of business on the regular record date for such interest installment, which
shall be the close of business on the business day next preceding such Interest
Payment Date. [IF PURSUANT TO THE PROVISIONS OF THE INDENTURE THE NOTES ARE NO
LONGER REPRESENTED BY A GLOBAL NOTE -- which shall be the close of business on
March 15, June 15, September 15 or December 15]. Any such interest installment
not punctually paid or duly provided for shall forthwith cease to be payable to
the registered Holders on such regular record date and may be paid to the Person
in whose name this Note (or one or more Predecessor Securities) is registered at
the close of business on a special record date to be fixed by the Trustee for
the payment of such defaulted interest, notice whereof shall be given to the
registered Holders of this series of Notes not less than 10 days prior to such
special record date, or may be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the Notes
may be listed, and upon such notice as may be required by such exchange, all as
more fully provided in the Indenture. The principal of (and premium, if any) and
the interest on this Note shall be payable at the office or agency of the
Trustee maintained for that purpose in any coin or currency of the United States
of America that at the time of payment is legal tender for payment of public and
private debts; provided, however, that payment of interest may be made at the
option of the Company by check mailed to the registered Holder at such address
as shall appear in the Security Register. Notwithstanding the foregoing, so long
as the Holder of this Note is the Property Trustee, the payment of the principal
of (and premium, if any) and interest on this Note will be made at such place
and to such account as may be designated by the Property Trustee.
The indebtedness evidenced by this Note is, to the extent
provided in the Indenture, subordinate and junior in right of payment to the
prior payment in full of all Senior Obligations (as defined in the Indenture)
and this Note is issued subject to the provisions of the Indenture with respect
thereto. Each Holder of this Note, by accepting the same, (a) agrees to and
shall be bound by such provisions, (b) authorizes and directs the Trustee on his
or her behalf to take such action as may be necessary or appropriate to
acknowledge or effectuate the subordination so provided and (c) appoints the
Trustee his or her attorney-in-fact for any and all such purposes. Each Holder
13
<PAGE>
hereof, by his or her acceptance hereof, hereby waives all notice of the
acceptance of the subordination provisions contained herein and in the Indenture
by each holder of Senior Obligations, whether now outstanding or hereafter
incurred, and waives reliance by each such holder upon said provisions.
This Note shall not be entitled to any benefit under the
Indenture hereinafter referred to, be valid or become obligatory for any purpose
until the Certificate of Authentication hereon shall have been signed by or on
behalf of the Trustee.
The provisions of this Note are continued on the reverse side
hereof and such continued provisions shall for all purposes have the same effect
as though fully set forth at this place.
IN WITNESS WHEREOF, the Company has caused this instrument to
be executed in its name by its duly authorized officers.
NATIONSBANK CORPORATION
By: ______________________
Name:_____________________
[Seal] Title:____________________
Attest:
By: ______________________
Name: _____________________
Title: ____________________
14
<PAGE>
(FORM OF CERTIFICATE OF AUTHENTICATION)
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
Dated ______________________
The Bank of New York,
as Trustee
By ______________________
Authorized Signatory
(FORM OF REVERSE OF NOTE)
This Note is one of a duly authorized series of Notes of the
Company (herein sometimes referred to as the "Notes"), specified in the
Indenture, all issued or to be issued in one or more series under and pursuant
to an Indenture dated as of November 27, 1996, duly executed and delivered
between the Company and The Bank of New York, as Trustee (the "Trustee"), as
supplemented by the First Supplemental Indenture dated as of December __, 1996,
between the Company and the Trustee (the Indenture as so supplemented, the
"Indenture"), to which Indenture and all indentures supplemental thereto
reference is hereby made for a description of the rights, limitations of rights,
obligations, duties and immunities thereunder of the Trustee, the Company and
the Holders of the Notes. By the terms of the Indenture, the Notes are issuable
in series that may vary as to amount, date of maturity, rate of interest and in
other respects as provided in the Indenture. This series of Notes is limited in
aggregate principal amount as specified in said First Supplemental Indenture.
Because of the occurrence and continuation of a Tax Event, as
defined in the Indenture, in certain circumstances, this Note may become due and
payable at the principal amount together with any interest accrued thereon (the
"Redemption Price"). The Redemption Price shall be paid prior to 12:00 noon, New
York time, on the date of such redemption or at such earlier time as the Company
determines. The Company shall have the right to redeem this Note at the option
of the Company, without premium or penalty, in whole or in part at any time on
or after December __, 2001 (an "Optional Redemption"), or at any time in
15
<PAGE>
certain circumstances upon the occurrence of a Tax Event, at a redemption price
equal to 100% of the principal amount plus any accrued but unpaid interest, to
the date of such redemption (the "Optional Redemption Price"). Any redemption
pursuant to this paragraph will be made upon not less than 30 days nor more than
60 days notice, at the Optional Redemption Price. If the Notes are only
partially redeemed by the Company pursuant to an Optional Redemption, the Notes
will be redeemed pro rata or by lot or by any other method utilized by the
Trustee; provided that if, at the time of redemption, the Notes are registered
as a Global Note, the Depositary shall determine the principal amount of such
Notes held by each Noteholder to be redeemed in accordance with its procedures.
In the event of redemption of this Note in part only, a new
Note or Notes of this series for the unredeemed portion hereof will be issued in
the name of the Holder hereof upon the cancellation hereof.
In case an Event of Default, as defined in the Indenture,
shall have occurred and be continuing, the principal of all of the Notes may be
declared, and upon such declaration shall become, due and payable, in the
manner, with the effect and subject to the conditions provided in the Indenture.
The Indenture contains provisions permitting the Company and
the Trustee, with the consent of the Holders of not less than a majority in
aggregate principal amount of the Notes of each series affected at the time
outstanding, as defined in the Indenture, to execute supplemental indentures for
the purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of the Indenture or of any supplemental indenture or of
modifying in any manner the rights of the Holders of the Notes; provided,
however, that no such supplemental indenture shall (i) extend the fixed maturity
of any Notes of any series, or reduce the principal amount thereof, or reduce
the rate or extend the time of payment of interest thereon, or reduce any
premium payable upon the redemption thereof, without the consent of the Holder
of each Note so affected, or (ii) reduce the aforesaid percentage of Notes, the
Holders of which are required to consent to any such supplemental indenture,
without the consent of the Holders of each Note then outstanding and affected
thereby. The Indenture also contains provisions permitting the Holders of a
majority in aggregate principal amount of the Notes of any series at the time
outstanding affected thereby, on behalf of all of the Holders of the Notes of
such series, to waive any past default in the performance of any of the
covenants contained in the Indenture, or established pursuant to the Indenture
with respect to such series, and its consequences. Any such consent or waiver by
the registered Holder of this Note (unless revoked as provided in the
16
<PAGE>
Indenture) shall be conclusive and binding upon such Holder and upon all future
Holders and owners of this Note and of any Note issued in exchange herefor or in
place hereof (whether by registration of transfer or otherwise), irrespective of
whether or not any notation of such consent or waiver is made upon this Note.
No reference herein to the Indenture and no provision of this
Note 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 Note at the time and place and at the rate and in the
money herein prescribed.
The Company shall have the right at any time during the term
of the Notes and from time to time to defer payment of interest by extending the
interest payment period of such Notes for a period not exceeding 20 consecutive
quarters (an "Extended Interest Payment Period"), at the end of which period the
Company shall pay all interest then accrued and unpaid (together with interest
thereon at the rate specified for the Notes to the extent that payment of such
interest is enforceable under applicable law); provided that no Extended
Interest Payment Period may last beyond the Maturity Date of the Notes. Before
the termination of any such Extended Interest Payment Period, the Company may
further extend such Extended Interest Payment Period, provided that such
Extended Interest Payment Period together with all such further extensions
thereof shall not exceed 20 consecutive quarters or extend the Maturity Date of
the Notes. At the termination of any such Extended Interest Payment Period and
upon the payment of all accrued and unpaid interest and any additional amounts
then due, the Company may commence a new Extended Interest Payment Period,
subject to the requirements contained in this paragraph.
As provided in the Indenture and subject to certain
limitations therein set forth, this Note is transferable by the registered
Holder hereof on the Security Register of the Company, upon surrender of this
Note for registration of transfer at the office or agency of the Trustee in the
City and State of New York accompanied by a written instrument or instruments of
transfer in form satisfactory to the Company or the Trustee duly executed by the
registered Holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Notes of authorized denominations and for the same
aggregate principal amount and series will be issued to the designated
transferee or transferees. No service charge will be made for any such transfer,
but the Company may require payment of a sum sufficient to cover any tax or
other governmental charge payable in relation thereto.
17
<PAGE>
Prior to due presentment for registration of transfer of this
Note, the Company, the Trustee, any paying agent and the Security Registrar may
deem and treat the registered holder hereof as the absolute owner hereof
(whether or not this Note shall be overdue and notwithstanding any notice of
ownership or writing hereon made by anyone other than the Security Registrar)
for the purpose of receiving payment of or on account of the principal hereof
and premium, if any, and interest due hereon and for all other purposes, and
neither the Company nor the Trustee nor any paying agent nor any Security
Registrar shall be affected by any notice to the contrary.
No recourse shall be had for the payment of the principal of
or the interest on this Note, 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 corporation, 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.
This Global Note is exchangeable for Notes in definitive form
only under certain limited circumstances set forth in the Indenture. Notes of
this series so issued are issuable only in registered form without coupons in
denominations of $25 and any integral multiple thereof. As provided in the
Indenture and subject to certain limitations herein and therein set forth, Notes
of this series so issued are exchangeable for a like aggregate principal amount
of Notes of this series of a different authorized denomination, as requested by
the Holder surrendering the same.
All terms used in this Note that are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
THE INTERNAL LAWS OF THE STATE OF NEW YORK SHALL GOVERN
THE INDENTURE AND THE NOTES WITHOUT REGARD TO CONFLICT OF LAW
PROVISIONS THEREOF.
ARTICLE VIII
ORIGINAL ISSUE OF NOTES
SECTION 8.1 Original Issue of Notes.
Notes in the aggregate principal amount of $711,350,000 may,
upon execution of this First Supplemental Indenture, be
18
<PAGE>
executed by the Company and delivered to the Trustee for authentication, and the
Trustee shall thereupon authenticate and deliver said Notes to or upon the
written order of the Company, signed by its Chief Executive Officer, Chief
Financial Officer, its President, or any Vice President or its Treasurer,
without any further action by the Company.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 Ratification of Indenture.
The Indenture, as supplemented by this First Supplemental
Indenture, is in all respects ratified and confirmed, and this First
Supplemental Indenture shall be deemed part of the Indenture in the manner and
to the extent herein and therein provided.
SECTION 9.2 Trustee Not Responsible for Recitals.
------------------------------------
The recitals herein contained are made by the Company and not
by the Trustee, and the Trustee assumes no responsibility for the correctness
thereof. The Trustee makes no representation as to the validity or sufficiency
of this First Supplemental Indenture.
SECTION 9.3 Governing Law.
This First Supplemental Indenture and each Note shall be
deemed to be a contract made under the internal laws of the State of New York,
and for all purposes shall be construed in accordance with the laws of said
State.
SECTION 9.4 Separability.
In case any one or more of the provisions contained in this
First Supplemental Indenture or in the Notes shall for any reason be held to be
invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provisions of this First
Supplemental Indenture or of the Notes, but this First Supplemental Indenture
and the Notes shall be construed as if such invalid or illegal or unenforceable
provision had never been contained herein or therein.
SECTION 9.5 Counterparts.
This First Supplemental Indenture may be executed in
any number of counterparts each of which shall be an original;
19
<PAGE>
but such counterparts shall together constitute but one and the
same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this First
Supplemental Indenture to be duly executed by their authorized respective
officers as of the day and year first above written.
NATIONSBANK CORPORATION
By: /s/ E. JEFFERY COUCH
Name:E. Jeffery Couch
Title:Senior Vice President
THE BANK OF NEW YORK
as Trustee
By /s/ BYRON MERINO
Name: Byron Merino
Title: Assistant Treasurer
20
<PAGE>
CONSENT TO ACTION BY
REGULAR TRUSTEES OF
NB CAPITAL TRUST I
November 27, 1996
As authorized by the terms and provisions of an Amended and Restated
Declaration of Trust for NB Capital Trust I (the "Trust") dated as of November
27, 1996, the undersigned Regular Trustees hereby execute this consent to action
by the Trust:
APPROVAL OF ISSUANCE AND SALE OF PREFERRED SECURITIES
WHEREAS, the Board of Directors of NationsBank Corporation (the
"Corporation") has determined that it is advisable and in the interests of the
Corporation to raise up to $1,000,000,000 in additional equity capital on behalf
of the Corporation (the "Additional Equity"), which equity capital may take the
form of preferred securities of a trust or other entity formed by or on behalf
of the Corporation; and
WHEREAS, in order to facilitate the utilization of a plan of financing
involving preferred securities, the Corporation, as Sponsor, caused this Trust
to be formed pursuant to the terms of a Declaration of Trust dated as of October
29, 1996, as amended and restated in its entirety by an Amended and Restated
Declaration of Trust dated as of November 27, 1996 (the "Declaration") and a
Certificate of Trust filed with the Secretary of State of Delaware on November
1, 1996; and
WHEREAS, the Corporation and this Trust have caused the filing of a
Registration Statement on Form S-3, Registration No. 333- 15375, with the
Securities and Exchange Commission (the "Commission") under the Securities Act
of 1933, as amended, with respect to up to $1,000,000,000 aggregate principal
amount of Trust Originated Preferred Securities (the "Preferred Securities"),
which Registration Statement was amended by pre-effective Amendment No. 1
thereto filed on November 18, 1996, and was further amended by Amendment No. 2
thereto filed on November 25, 1996 and by Amendment No. 3 thereto filed on
November 26, 1996 and declared effective on November 27, 1996 (as so amended,
the "Registration Statement"); and
WHEREAS, no stop order suspending the effectiveness of the Registration
Statement has been received by the Corporation and no proceedings for that
purpose have been instituted or threatened against the Corporation;
RESOLVED, that the Registration Statement is ratified and approved and
the Trustees hereby are authorized and empowered to execute and file all such
other instruments and documents, to make
<PAGE>
all such payments and do all such other acts and things in connection with the
Registration Statement (including the execution and filing of any pre-effective
or post-effective amendments thereto), as they may deem necessary or advisable
in order to effect such filing and to procure the effectiveness of the
Registration Statement (and any such post-effective amendments thereto), and to
make such supplements to the Prospectus forming a part of said Registration
Statement as may be required or otherwise as they may deem advisable;
RESOLVED FURTHER, that each of John E. Mack, Paul J. Polking and
Charles M. Berger hereby is appointed attorneys-in-fact for, and each of them
with full power to act without the other hereby is authorized and empowered to
sign the Registration Statement and any amendment or amendments (including any
pre-effective or post-effective amendments) thereto on behalf of, the Trust;
RESOLVED FURTHER, that Paul J. Polking is hereby designated as
Agent for Service of the Trust with all such powers as are provided
by the Rules and Regulations of the Securities and Exchange
Commission;
RESOLVED FURTHER, that any of the Trustees hereby is authorized to
determine the states or jurisdictions in which appropriate action shall be taken
to qualify or register for distribution the Preferred Securities, as such
Trustees may deem advisable; that such Trustees hereby are authorized to perform
on behalf of the Trust any and all such acts as they may deem necessary or
advisable in order to comply with the applicable laws of any such states or
jurisdictions, and in connection therewith to execute and file all requisite
papers and documents, including without limitation resolutions, applications,
reports, surety bonds, irrevocable consents and appointments of attorneys for
service of process; and the execution by such officers of any such paper or
document or the doing by them of any act in connection with the foregoing matter
shall establish conclusively their authority therefor from the Trust and the
approval and ratification by the Trust of the papers and documents so executed
and the actions so taken;
RESOLVED FURTHER, that such Trustees hereby are authorized and directed
to do any and all things which in their judgment may be necessary or appropriate
in order to obtain a permit, exemption, registration or qualification for, and a
dealer's license with respect to, the distribution of the Preferred Securities
in accordance with and pursuant to the terms of any underwriting or distribution
agreements, under the securities or insurance laws of any one or more of the
states or jurisdictions as such officers may deem advisable and in connection
therewith to execute, acknowledge, verify, deliver, file and publish all
applications, reports, resolutions, consents, consents to service of process,
powers of attorneys, commitments and other papers and instruments as may be
required under such laws and to take any and all further action
2
<PAGE>
which they may deem necessary or appropriate in order to secure and to maintain
such permits, exemptions, registrations and qualifications in effect for so long
as they shall deem in the best interest of the Trust;
RESOLVED FURTHER, that if the securities or blue sky laws of any
jurisdiction or the regulations or governing authority of any exchange or
trading entity require that particular forms of resolutions covering any matter
mentioned in the preceding resolutions be adopted, all such resolutions are
hereby adopted as if the same had been so presented and adopted herein;
RESOLVED FURTHER, that in order to facilitate the operation of the
Trust, the Trustees are authorized to execute and deliver a Subscription
Agreement between the Corporation and the Trust (the "Subscription Agreement")
pursuant to which the Corporation will agree to purchase and own directly or
indirectly all of the Trust's outstanding Common Securities (the "Common
Securities");
RESOLVED FURTHER, that in order to facilitate the raising of necessary
funds, the Trustees are authorized to join with the Corporation and execute,
deliver and perform an Underwriting Agreement dated as of November 27, 1996 (the
"Underwriting Agreement") between the Corporation and the Trust and Merrill
Lynch, Pierce, Fenner & Smith Incorporated, Dean Witter Reynolds Inc., A. G.
Edwards & Sons, Inc., PaineWebber Incorporated, Prudential Securities
Incorporated and Smith Barney Inc. (collectively, the "Representatives"), as
Representatives for the several underwriters named therein pursuant to which the
Trust will agree to issue and sell Preferred Securities denominated as the
24,000,000 7.84% Trust Originated Preferred Securities to the Underwriters and
grant to the Underwriters an option to purchase under certain conditions up to
3,600,000 Additional Preferred Securities (the "Option");
RESOLVED FURTHER, that the Trustees are authorized to execute and
deliver a Note Purchase Agreement between the Corporation and the Trust (the
"NPA") pursuant to which the Corporation will sell up to an aggregate of
$711,350,000 of its 7.84% Junior Subordinated Deferrable Interest Notes (the
"Notes") to the Trust;
RESOLVED FURTHER, that the Authorized Officers are hereby authorized to
take any and all actions necessary or appropriate to implement and carry out the
Corporation's obligations under the Option, including the execution and delivery
of supplements to the Declaration and all necessary documents and certificates
in connection with such action;
RESOLVED FURTHER, that the terms, conditions and provisions of the
Declaration, the Subscription Agreement, the Underwriting Agreement, and the NPA
are hereby ratified and approved, with such changes and upon such terms as the
Trustees executing then shall determine;
3
<PAGE>
RESOLVED FURTHER, that the Trustees are hereby authorized to (i)
execute and file an application to list the Preferred Securities on the New York
Stock Exchange and (ii) execute and file a registration statement on Form 8-A
with the Commission;
RESOLVED FURTHER, that all actions previously taken by the Trustees or
agents of the Trust in anticipation of, or in connection with the transactions
described in these resolutions, be and the same are hereby ratified, confirmed
and approved; and
RESOLVED FURTHER, that each of the Trustees hereby is authorized and
directed to do any and all things necessary, appropriate or convenient to carry
into effect the foregoing resolutions.
4
<PAGE>
RESOLUTIONS OF COMMITTEE
APPOINTED BY THE BOARD OF DIRECTORS OF
NATIONSBANK CORPORATION
November 27, 1996
Approval of 7.84% Junior Subordinated Deferrable
Interest Notes, due 2026
WHEREAS, by resolutions adopted by the Board of Directors (the "Board")
of the Corporation at a meeting duly called and held on October 23, 1996, this
Committee was appointed by the Board (the "Committee") with full authority to
take action to raise up to $1,000,000,000 of equity capital (the "Capital") on
behalf of the Corporation; and
WHEREAS, in order to facilitate the Corporation's financing, the Board
authorized this Committee to approve the formation of special purpose financing
entities, the guaranty by the Corporation of the obligations of such entities,
the registration for sale and public sale of such obligations and the entry by
the Corporation into agreements with such entities providing for the loan of the
proceeds from the sale of such obligations to the Corporation; and
WHEREAS, as authorized by the Board on November 1, 1996, the
Corporation filed a Registration Statement on Form S-3, Registration No.
333-15375, with the Securities and Exchange Commission (the "Commission") under
the Securities Act of 1933, as amended, with respect to obligations of certain
special purpose subsidiaries and guarantees and subordinated debt securities of
the Corporation, which Registration Statement was amended by pre-effective
Amendment No. 1 thereto filed on November 18, 1996, and was further amended by
Amendment No. 2 thereto filed on November 25, 1996 and Amendment No. 3 thereto
filed on November 26, 1996 and declared effective on November 27, 1996 (as so
amended, the "Registration Statement"); and
WHEREAS, this Committee has determined to authorize the issuance of a
series of up to $711,350,000 of the Corporation's junior subordinated deferrable
interest notes as described in these resolutions; and
WHEREAS, no stop order suspending the effectiveness of the Registration
Statement has been received by the Corporation and no proceedings for that
purpose have been instituted or threatened against the Corporation;
2
<PAGE>
NOW, THEREFORE, BE IT RESOLVED, that the formation by the Corporation,
as sponsor, of three statutory business trusts under the Delaware Business Trust
Act be, and the same is, hereby ratified and approved, and any of the Chief
Executive Officer, Chief Financial Officer, any Vice President or any Associate
General Counsel of the Corporation (each, an "Authorized Officer") is hereby
authorized to execute and deliver appropriate declarations of trust as well as
an Amended and Restated Declaration of Trust for NB Capital Trust I (the
"Declaration") pursuant to which a trust is formed (the "Trust") to facilitate
the financing described in these resolutions;
RESOLVED FURTHER, that the selection and appointment of The Bank of New
York as Property Trustee, The Bank of New York (Delaware) as Delaware Trustee
and John E. Mack, William L. Maxwell and Marc D. Oken as Regular Trustees
(collectively, the "Trustees") of the Trust is hereby ratified and approved; and
RESOLVED FURTHER, that in order to facilitate the formation and
operation of the Trust, Authorized Officers of the Corporation are authorized to
execute and deliver (i) a Subscription Agreement between the Corporation and the
Trust (the "Subscription Agreement") pursuant to which the Corporation will
agree to purchase and own all of the Trust's outstanding Common Securities (the
"Common Securities"), (ii) a Common Securities Guarantee pursuant to which the
Corporation will guarantee the performance by the Trust of its obligations in
connection with its outstanding Common Securities (the "Common Securities
Guarantee") and (iii) a Preferred Securities Guarantee pursuant to which the
Corporation will guarantee the performance by the Trust of its obligations in
connection with all of the outstanding Preferred Securities of the Trust (the
"Preferred Securities Guarantee" and with the Common Securities Guarantee, the
"Guarantees");
RESOLVED FURTHER, that in order to facilitate the raising of necessary
funds, the Authorized Officers are authorized to join with the Trust and to
execute an Underwriting Agreement dated as of November 27, 1996 (the
"Underwriting Agreement") among the Corporation and the Trust and Merrill Lynch,
Pierce, Fenner & Smith Incorporated, Dean Witter Reynolds Inc., A. G. Edwards &
Sons, Inc., PaineWebber Incorporated, Prudential Securities Incorporated and
Smith Barney Inc. as representatives for the several underwriters described
therein (collectively, the "Underwriters") pursuant to which the Trust will
agree to issue and sell up to 24,000,000 7.84% Trust Originated Preferred
Securities (the "Preferred Securities" and, with the Common Securities, the
"Securities") to the Underwriters and grant to the Underwriters an option to
purchase under certain conditions up to 3,600,000 Additional Preferred
Securities (the "Option"); and
RESOLVED FURTHER, that to facilitate a loan to the Corporation of the
proceeds from the sale of the Securities, the Authorized Officers are authorized
to execute and deliver (i) an Indenture
3
<PAGE>
dated as of November 27, 1996 (the "Indenture") between the Corporation and The
Bank of New York (in such capacity, the "Indenture Trustee") to provide for the
issuance by the Corporation of junior subordinated debt securities; (ii) a form
of First Supplemental Indenture dated as of December 4, 1996 (the "First
Supplemental Indenture") between the Corporation and the Indenture Trustee to
set the terms of, and authorize the issuance by the Corporation of a series of
up to $711,350,000 in aggregate principal amount of its junior subordinated debt
securities to be known as its 7.84% Junior Subordinated Deferrable Interest
Notes due 2026 (the "Notes"), which Notes shall be subject to the terms and
entitled to the benefits of the Indenture; and (iii) a Note Purchase Agreement
between the Corporation and the Trust (the "Note Purchase Agreement") pursuant
to which the Corporation will sell the Notes to the Trust; and
RESOLVED FURTHER, that the Notes shall bear interest at the rate of
7.84% per annum, which interest shall accrue from December 4, 1996 and shall be
payable quarterly on March 31 , June 30, September 30 and December 31,
commencing December 31, 1996; and if the Notes cease to be registered in book
entry only form, the record date for the interest payable shall be the 15th of
the calendar month in which the interest payment date occurs;
RESOLVED FURTHER, that the maturity date of the Notes shall be
December 31, 2026;
RESOLVED FURTHER, that the Notes shall be issued as Registered
Securities (as defined in the Indenture) initially in book-entry only form,
represented by one or more global notes registered in the name of The Depository
Trust Company, or its nominee, in the manner requested by the Underwriters, in
denominations of $25 or integral multiples thereof, and shall be dated the date
of authentication and delivery, which date shall occur on or about December 4,
1996, and the form of registered global note contained in the First Supplemental
Indenture, together with such modifications as are appropriate to reflect the
determinations of this Committee, is hereby in all respects approved;
RESOLVED FURTHER, that the Notes shall be executed in the name of and
on behalf of the Corporation by the Chief Executive Officer, or any Senior or
other Vice President, and the corporate seal shall be affixed thereon and shall
be attested by the Secretary or any Assistant Secretary, and the signatures of
the Chief Executive Officer, any Vice President, the Secretary and any Assistant
Secretary may be in the form of facsimile signatures of the current or any Chief
Executive Officer, Vice President, Secretary or Assistant Secretary, and should
any officer of the Corporation who signs, or whose facsimile signature appears
upon, any of the Notes, cease to be such an officer prior to the issuance of
such Notes, the Notes so signed or bearing such facsimile signature shall
nevertheless be valid, and, without prejudice to the use of the facsimile
signatures of any other officer as hereinbefore
4
<PAGE>
authorized, the facsimile signatures of Hugh L. McColl, Jr., Chief
Executive Officer of the Corporation, John E. Mack, Senior Vice
President and Treasurer of the Corporation, James W. Kiser,
Secretary of the Corporation, and Allison Gilliam, Assistant
Secretary of the Corporation, are hereby expressly approved and
accepted;
RESOLVED FURTHER, that pursuant to the provisions of the Indenture and
the First Supplemental Indenture each Authorized Officer is hereby authorized
and empowered to cause the Notes, upon execution thereof, to be delivered to the
Indenture Trustee under the Indenture, or to any agent designated by the
Indenture Trustee, for authentication and delivery by it and to deliver to said
Trustee or agent thereof, as the case may be, the written order of the
Corporation for the authentication and delivery of the Notes, and to negotiate,
execute and deliver any and all agreements and other documents and certificates
necessary in connection with the issuance, sale and delivery of the Notes;
RESOLVED FURTHER, that the Authorized Officers are hereby authorized to
take any and all actions necessary or appropriate to implement and carry out the
Corporation's obligations under the Option, including the execution and delivery
of supplements to the Indenture and Declaration and all necessary documents and
certificates in connection with such action;
RESOLVED FURTHER, that the terms, conditions and provisions of the
Declaration, the Subscription Agreement, the Guarantees, the Underwriting
Agreement, the Indenture, the First Supplemental Indenture and the Note Purchase
Agreement are hereby ratified and approved, with such changes and upon such
terms as the Authorized Officers executing then shall determine;
RESOLVED FURTHER, that all actions previously taken by officers of the
Corporation in anticipation of, or in connection with the transactions described
in these resolutions, be and the same are hereby ratified, confirmed and
approved; and
RESOLVED FURTHER, that each of the Authorized Officers hereby is
authorized and directed to do any and all things necessary, appropriate or
convenient to carry into effect the foregoing resolutions.
5
NationsBank Corporation
NationsBank Corporate Center
Charlotte, NC 28255
NATIONSBANK NEWS RELEASE
FOR IMMEDIATE RELEASE
NOV. 27, 1996 -- NationsBank Corporation announced an agreement today for
the underwritten public offering of $600 million in trust-originated
preferred securities.
The issue is part of a shelf registration for trust-originated preferred
securities declared effective by the Securities and Exchange Commission.
The annual distribution rate of 7.84 percent will be paid at the close of each
quarter. The offering will be sold through underwriters led by Merrill Lynch &
Co., Dean Witter Reynolds Inc., A.G. Edwards & Sons, Inc., PaineWebber
Incorporated, Prudential Securities Incorporated and Smith Barney Inc. Closing
is scheduled for Dec. 4.
Proceeds from the transaction will be used in conjunction with the pending
merger with Boatmen's Bancshares Inc., a transaction announced Aug. 30.
NationsBank Corporation is the fifth-largest U.S. banking company, with $188
billion in assets at Sept. 30, 1996, and full-service banking centers in
nine states and the District of Columbia.
####
Media contact: Martha Larsh (704)388-4379
