<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 9, 1996
REGISTRATION NO. 333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
NATIONSBANK CORPORATION
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
NORTH CAROLINA
(State or other jurisdiction of incorporation or 56-0906609
organization) (I.R.S. Employer Identification No.)
</TABLE>
NATIONSBANK CORPORATE CENTER, CHARLOTTE, NORTH CAROLINA 28255 (704) 386-5000
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
PAUL J. POLKING
EXECUTIVE VICE PRESIDENT AND GENERAL COUNSEL
NATIONSBANK CORPORATION
NATIONSBANK CORPORATE CENTER
CHARLOTTE, NORTH CAROLINA 28255
(704) 386-5000
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
COPIES TO:
<TABLE>
<S> <C>
BOYD C. CAMPBELL, JR. JAMES R. TANENBAUM
SMITH HELMS MULLISS & MOORE, L.L.P. STROOCK & STROOCK & LAVAN
214 NORTH CHURCH STREET SEVEN HANOVER SQUARE
CHARLOTTE, NORTH CAROLINA 28202 NEW YORK, NEW YORK 10004
</TABLE>
APPROXIMATE DATE OF COMMENCEMENT OF THE PROPOSED SALE TO THE PUBLIC:
From time to time after the effective date of this Registration Statement.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box: [ ]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, please check the following box: [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of earlier effective
registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [X]
CALCULATION OF REGISTRATION FEE
[CAPTION]
<TABLE>
<S> <C> <C> <C>
TITLE OF EACH PROPOSED MAXIMUM PROPOSED MAXIMUM
CLASS OF SECURITIES AMOUNT TO BE OFFERING PRICE AGGREGATE
TO BE REGISTERED REGISTERED (1) PER UNIT (2) OFFERING PRICE (1)(2)
<S> <C> <C> <C>
Debt Securities (3)(4) N/A (3)
Preferred Stock
Depositary Shares (3)(4) N/A (3)
Common Stock (3)(4)(5) N/A (3)
Total $3,000,000,000 100% $3,000,000,000
<CAPTION>
TITLE OF EACH
CLASS OF SECURITIES AMOUNT OF
TO BE REGISTERED REGISTRATION FEE
<S> <C>
Debt Securities N/A
Preferred Stock
Depositary Shares N/A
Common Stock N/A
Total $909,091
</TABLE>
(1) In no event will the aggregate initial offering price of the Debt
Securities, Preferred Stock, Depositary Shares and Common Stock issued under
this registration statement exceed $3,000,000,000, or the U.S. dollar
equivalent thereof in one or more foreign currencies or currency units. If
any Debt Securities are issued at an original issue discount, then
additional Debt Securities may be issued so long as the aggregate original
principal amount of all such Debt Securities, together with the original
principal amount of all other securities registered and offered hereunder,
does not exceed such amount.
(2) Estimated solely for purposes of computing the registration fee. The
proposed maximum offering price per unit will be determined from time to
time by the Registrant in connection with the issuance by the Registrant of
the securities registered hereunder.
(3) In addition to any Debt Securities, Preferred Stock, Depositary Shares or
Common Stock that may be issued directly under this registration statement,
there are being registered hereunder an indeterminate amount of Debt
Securities, and an indeterminate number of shares of Preferred Stock,
Depositary Shares or Common Stock, as may be issued upon conversion of Debt
Securities, Preferred Stock or Depositary Shares, as the case may be. No
separate consideration will be received for any Debt Securities, Preferred
Stock, Depositary Shares or Common Stock so issued upon such conversion.
(4) Includes an indeterminate amount of Debt Securities and an indeterminate
number of shares of Preferred Stock, Depositary Shares or Common Stock as
may be offered or sold in connection with market making activities by
affiliates of the Registrant.
(5) The aggregate amount of Common Stock registered hereunder is limited to that
which is permissible under Rule 415(a)(4) of the Securities Act.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT, OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE
ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY
DETERMINE.
<PAGE>
EXPLANATORY NOTES
This Registration Statement contains two forms of Prospectus of NationsBank
Corporation ("NationsBank"): one (the "Debt Prospectus") to be used in
connection with the offering and sale of Debt Securities, including any
Preferred Stock, Depositary Shares, Common Stock or Debt Securities into which
the Debt Securities may be convertible, and one (the "Equity Prospectus") to be
used in connection with the offering and sale of Preferred Stock, Depositary
Shares or Common Stock, including any such shares into which the Preferred Stock
or Depositary Shares may be convertible. Each offering made under this
Registration Statement will be made pursuant to one of these Prospectuses, with
the specific terms of the securities offered thereby being set forth in an
accompanying Prospectus Supplement.
The Debt Prospectus also includes a form of a market maker prospectus
intended for use by NationsBanc Capital Markets, Inc. ("NCMI"), a direct
wholly-owned subsidiary of NationsBank, in connection with offers and sales
related to secondary market transactions in the Debt Securities. The Debt
Prospectus follows immediately after this page of Explanatory Notes. Following
such Debt Prospectus are the alternate cover page, pages 6 through 17 and the
back cover page of the market maker Debt Prospectus. All other pages of the Debt
Prospectus are also to be used for the market maker Debt Prospectus.
The Equity Prospectus also includes a form of a market maker prospectus
intended for use by NCMI in connection with offers and sales related to
secondary market transactions in the Preferred Stock, Depositary Shares or
Common Stock. The Equity Prospectus follows immediately after the alternate
pages of the Debt Prospectus. Following such Equity Prospectus are the alternate
cover page, pages 6 through 13 and the back cover page of the market maker
Equity Prospectus. All other pages of the Equity Prospectus are also to be used
for the market maker Equity Prospectus.
<PAGE>
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED OCTOBER 9, 1996
[DEBT]
PROSPECTUS
NATIONSBANK(Register Mark)
Debt Securities
NationsBank Corporation ("NationsBank" or the "Corporation") may offer from
time to time its unsecured debt securities, which may be either senior (the
"Senior Debt Securities") or subordinated (the "Subordinated Debt Securities"
and, together with the Senior Debt Securities, the "Debt Securities").
NationsBank may sell up to $3,000,000,000 in aggregate initial offering price of
Debt Securities (or the U.S. dollar equivalent thereof if any of the Debt
Securities are denominated in a foreign currency or currency unit), which may be
offered, separately or together, in one or more series, in amounts, at prices
and on terms to be determined at the time of sale and set forth in an
accompanying supplement to this Prospectus (a "Prospectus Supplement"). Pursuant
to the terms of the Registration Statement of which this Prospectus constitutes
a part, NationsBank may also offer and sell shares of its preferred stock (the
"Preferred Stock"), which may be represented by depositary shares (the
"Depositary Shares"), and shares of its common stock (the "Common Stock"). Any
such Preferred Stock, Depositary Shares or Common Stock will be offered and
issued pursuant to the terms of a separate Prospectus contained in such
Registration Statement. The aggregate amount of Debt Securities that may be
offered and sold pursuant hereto is subject to reduction as the result of the
sale of any Preferred Stock, Depositary Shares or Common Stock pursuant to such
separate Prospectus or at the Corporation's discretion.
The Senior Debt Securities will rank equally with all other unsubordinated
and unsecured indebtedness of the Corporation. The Subordinated Debt Securities
will be subordinate in right of payment to all existing and future Senior
Indebtedness (as defined herein) of the Corporation.
The Debt Securities may be denominated in U.S. dollars or in another
currency or currency unit (such as the European Currency Unit), and the
principal of (and premium, if any, on) or any interest on the Debt Securities
may be payable in U.S. dollars or such foreign currency or currency unit. The
specific terms of each series of Debt Securities offered pursuant to this
Prospectus, including the specific designation, aggregate principal amount,
currency or currency unit in which the principal and any premium or interest may
be payable, authorized denominations, maturity, any premium, any interest rate
(which may be fixed or variable), any interest payment dates, any optional or
mandatory redemption terms, any sinking fund provisions, any subordination
terms, any terms for conversion (in the event that such series is convertible at
the option of the holder or NationsBank into Preferred Stock, Depositary Shares,
Common Stock or other Debt Securities), the form of such series, any securities
exchange on which such Debt Securities may be listed, and any other terms of
such series of Debt Securities will be set forth in the Prospectus Supplement
relating to such series.
The Debt Securities may be sold (i) through underwriting syndicates
represented by managing underwriters, or by underwriters without a syndicate,
with such underwriters to be designated at the time of sale; (ii) through agents
designated from time to time; or (iii) directly by the Corporation. The names of
any underwriters or agents of NationsBank involved in the sale of the Debt
Securities, the public offering price or purchase price and any commissions or
discounts will be set forth in the applicable Prospectus Supplement or a pricing
supplement thereto. The net proceeds to the Corporation from such sale also will
be set forth in such Prospectus Supplement or pricing supplement.
This Prospectus may not be used to consummate sales of Debt Securities
unless accompanied by a Prospectus Supplement.
THESE SECURITIES ARE NOT SAVINGS ACCOUNTS OR BANK DEPOSITS, ARE NOT
OBLIGATIONS OF OR GUARANTEED BY ANY BANKING OR NONBANKING AFFILIATE OF
NATIONSBANK, ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION OR ANY OTHER GOVERNMENT AGENCY AND INVOLVE
INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION, THE COMMISSIONER OF INSURANCE OF THE STATE OF NORTH
CAROLINA (THE "COMMISSIONER") OR ANY STATE SECURITIES COMMISSION NOR
HAS THE SECURITIES AND EXCHANGE COMMISSION, THE COMMISSIONER OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is , 1996.
(A redherring appears on the left-hand side of this page, rotated
90 degrees. Text is as follows:)
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY STATE.
<PAGE>
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, previously filed by the Corporation with the
Securities and Exchange Commission (the "Commission") pursuant to Section 13 of
the Securities Exchange Act of 1934, as amended (the "1934 Act"), are
incorporated herein by reference:
(a) The Corporation's Annual Report on Form 10-K for the year ended
December 31, 1995;
(b) The Corporation's Quarterly Reports on Form 10-Q for the quarters
ended March 31, 1996 and June 30, 1996;
(c) The Corporation's Current Reports on Form 8-K filed January 12,
1996, February 1, 1996, March 8, 1996, April 17, 1996, May 16, 1996, July
5, 1996, July 31, 1996, September 6, 1996 (as amended by Form 8-K/A-1 filed
September 11, 1996) and September 20, 1996 (as amended by Form 8-K/A filed
September 23, 1996); and
(d) The description of the Corporation's Common Stock contained in its
registration statement filed pursuant to Section 12 of the 1934 Act, and
any amendment or report filed for the purpose of updating such description,
including the Corporation's Current Report on Form 8-K filed on September
21, 1994.
All reports and any definitive proxy or information statements filed by the
Corporation with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of
the 1934 Act subsequent to the date of this Prospectus and prior to the
termination of the offering of the Debt Securities offered hereby shall be
deemed to be incorporated by reference in this Prospectus and to be a part
hereof from the date of filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
THE CORPORATION WILL PROVIDE WITHOUT CHARGE TO EACH PERSON TO WHOM THIS
PROSPECTUS IS DELIVERED, ON THE WRITTEN OR ORAL REQUEST OF ANY SUCH PERSON, A
COPY OF ANY OR ALL OF THE DOCUMENTS INCORPORATED HEREIN BY REFERENCE (OTHER THAN
EXHIBITS TO SUCH DOCUMENTS WHICH ARE NOT SPECIFICALLY INCORPORATED BY REFERENCE
IN SUCH DOCUMENTS). WRITTEN REQUESTS FOR SUCH COPIES SHOULD BE DIRECTED TO JOHN
E. MACK, SENIOR VICE PRESIDENT AND TREASURER, NATIONSBANK CORPORATION,
NATIONSBANK CORPORATE CENTER, CORPORATE TREASURY DIVISION, CHARLOTTE, NORTH
CAROLINA 28255. TELEPHONE REQUESTS MAY BE DIRECTED TO (704) 386-5972.
AVAILABLE INFORMATION
NationsBank is subject to the informational requirements of the 1934 Act
and, in accordance therewith, files reports, proxy statements and other
information with the Commission. Such reports, proxy statements and other
information can be inspected and copied at the following public reference
facilities maintained by the Commission: 450 Fifth Street, N.W., Washington,
D.C. 20549; 7 World Trade Center, Suite 1300, New York, New York 10048; and the
Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois
60661-2511. Copies of such material may also be obtained by mail from the Public
Reference Section of the Commission at 450 Fifth Street, N.W., Room 1024,
Washington, D.C. 20549, upon payment of prescribed rates. The Commission
maintains an Internet web site that contains reports, proxy and information
statements and other information regarding issuers who file electronically with
the Commission. The address of that site is http://www.sec.gov. In addition,
reports, proxy statements and other information concerning NationsBank may be
inspected at the offices of the New York Stock Exchange, Inc., 20 Broad Street,
New York, New York 10005 and at the offices of The Pacific Stock Exchange
Incorporated, 301 Pine Street, San Francisco, California 94104.
2
<PAGE>
NATIONSBANK CORPORATION
GENERAL
NationsBank is a bank holding company established as a North Carolina
corporation in 1968 and is registered under the Bank Holding Company Act of
1956, as amended (the "BHCA"), with its principal assets being the stock of its
subsidiaries. Through its banking subsidiaries (the "Banks") and its various
non-banking subsidiaries, NationsBank provides banking and banking-related
services, primarily throughout the Southeast and Mid-Atlantic states and Texas.
The principal executive offices of NationsBank are located at NationsBank
Corporate Center in Charlotte, North Carolina 28255. Its telephone number is
(704) 386-5000.
OPERATIONS
NationsBank provides a diversified range of banking and certain nonbanking
financial services and products through its various subsidiaries. NationsBank
manages its business activities through three major business units: the General
Bank, Global Finance and Financial Services.
The General Bank provides comprehensive services in the commercial and
retail banking fields, including the origination and servicing of home mortgage
loans, the issuance and servicing of credit cards (through a Delaware
subsidiary), indirect lending, dealer finance and certain insurance services.
The General Bank also offers full service brokerage services and discount
brokerage services and provides investment advisory services to a proprietary
mutual fund, as well as investment management, banking and fiduciary services
through subsidiaries of NationsBank. As of June 30, 1996, the General Bank
operated 1,948 banking offices through the following Banks: NationsBank, N.A.
(serving the states of North Carolina, South Carolina, Maryland and Virginia and
the District of Columbia); NationsBank, N.A. (South) (serving the states of
Florida and Georgia); NationsBank of Kentucky, N.A.; NationsBank of Tennessee,
N.A.; NationsBank of Texas, N.A.; and Sun World, N.A. (serving the states of
Texas and New Mexico). The General Bank also provides fully automated, 24-hour
cash dispensing and depositing services throughout the states in which it is
located, through 3,333 automated teller machines.
Global Finance provides comprehensive corporate and investment banking as
well as trading and distribution services to domestic and international
customers. The group serves as a principal lender and investor, as well as an
advisor, arranger and underwriter, and manages treasury and trade transactions
for clients and customers. Loan origination and syndication, asset-backed
lending, leasing, factoring, project finance and mergers and acquisitions are
representative of the services provided by the group. Global Finance also
underwrites, trades and distributes a wide range of securities (including
bank-eligible securities and, to a limited extent, bank-ineligible securities as
authorized by the Board of Governors of the Federal Reserve System (the "Federal
Reserve Board")), and trades and distributes a wide range of derivative products
in certain interest rate, foreign exchange, commodity and equity markets. Global
Finance provides its services through various offices located in major United
States cities as well as in London, Frankfurt, Singapore, Bogota, Mexico City,
Grand Cayman, Nassau, Seoul, Tokyo, Osaka, Taipei and Hong Kong.
Financial Services includes NationsCredit Consumer Corporation, primarily a
consumer finance subsidiary, and NationsCredit Commercial Corporation, primarily
a commercial finance subsidiary. NationsCredit Consumer Corporation, which has
approximately 331 offices located in 36 states, provides personal, mortgage and
automobile loans to consumers and retail finance programs to dealers.
NationsCredit Commercial Corporation consists of seven divisions that specialize
in one or more of the following areas: equipment loans and leasing; loans for
debt restructuring, mergers and acquisitions and working capital; real estate,
golf/recreational and health care financing; and inventory financing to
manufacturers, distributors and dealers.
As part of its operations, NationsBank regularly evaluates the potential
acquisition of, and holds discussions with, various financial institutions and
other businesses of a type eligible for bank holding company investment. In
addition, NationsBank regularly analyzes the values of, and submits bids for,
the acquisition of customer-based funds and other liabilities and assets of such
financial institutions and other businesses. As a general rule, NationsBank
publicly announces such material acquisitions when a definitive agreement has
been reached.
3
<PAGE>
SUPERVISION AND REGULATION
GENERAL. As a registered bank holding company, NationsBank is subject to
the supervision of, and to regular inspection by, the Federal Reserve Board. The
Banks are organized as national banking associations, which are subject to
regulation, supervision and examination by the Office of the Comptroller of the
Currency (the "Comptroller"). The Banks are also subject to regulation by the
Federal Deposit Insurance Corporation (the "FDIC") and other federal regulatory
agencies. In addition to banking laws, regulations and regulatory agencies,
NationsBank and its subsidiaries and affiliates are subject to various other
laws and regulations and supervision and examination by other regulatory
agencies, all of which directly or indirectly affect the Corporation's
operations, management and ability to make distributions. The following
discussion summarizes certain aspects of those laws and regulations that affect
NationsBank.
Under the BHCA, the activities of NationsBank, and those of companies which
it controls or in which it holds more than 5% of the voting stock, are limited
to banking or managing or controlling banks or furnishing services to or
performing services for its subsidiaries, or any other activity which the
Federal Reserve Board determines to be so closely related to banking or managing
or controlling banks as to be a proper incident thereto. In making such
determinations, the Federal Reserve Board is required to consider whether the
performance of such activities by a bank holding company or its subsidiaries can
reasonably be expected to produce benefits to the public such as greater
convenience, increased competition or gains in efficiency that outweigh possible
adverse effects, such as undue concentration of resources, decreased or unfair
competition, conflicts of interest or unsound banking practices. Generally, bank
holding companies, such as NationsBank, are required to obtain prior approval of
the Federal Reserve Board to engage in any new activity not previously approved
by the Federal Reserve Board or to acquire more than 5% of any class of voting
stock of any company.
The BHCA also requires bank holding companies to obtain the prior approval
of the Federal Reserve Board before acquiring more than 5% of any class of
voting stock of any bank which is not already majority-owned by the bank holding
company. Pursuant to the Riegle-Neal Interstate Banking and Branching Efficiency
Act of 1994 (the "Interstate Banking and Branching Act"), a bank holding company
became able to acquire banks in states other than its home state beginning
September 29, 1995, without regard to the permissibility of such acquisition
under state law, but subject to any state requirement that the bank has been
organized and operating for a minimum period of time, not to exceed five years,
and the requirement that the bank holding company, prior to or following the
proposed acquisition, controls no more than 10% of the total amount of deposits
of insured depository institutions in the United States and no more than 30% of
such deposits in that state (or such lesser or greater amount set by state law).
The Interstate Banking and Branching Act also authorizes banks to merge
across state lines, therefore creating interstate branches, beginning June 1,
1997. Under such legislation, each state has the opportunity either to "opt out"
of this provision, thereby prohibiting interstate branching in such states, or
to "opt in" at an earlier time, thereby allowing interstate branching within
that state prior to June 1, 1997. Furthermore, pursuant to such act, a bank is
now able to open new branches in a state in which it does not already have
banking operations if the laws of such state permit such DE NOVO branching. Of
those states in which the Banks are located, Delaware, Maryland, New Mexico,
North Carolina and Virginia have enacted legislation to "opt in," thereby
permitting interstate branching prior to June 1, 1997, and Texas has adopted
legislation to "opt out" of the interstate branching provisions (which Texas law
currently expires on September 2, 1999).
As previously described, NationsBank regularly evaluates merger and
acquisition opportunities, and it anticipates that it will continue to evaluate
such opportunities in light of the new legislation.
Proposals to change the laws and regulations governing the banking industry
are frequently introduced in Congress, in the state legislatures and before the
various bank regulatory agencies.
CAPITAL AND OPERATIONAL REQUIREMENTS. The Federal Reserve Board, the
Comptroller and the FDIC have issued substantially similar risk-based and
leverage capital guidelines applicable to United States banking organizations.
In addition, those regulatory agencies may from time to time require that a
banking organization maintain capital above the minimum levels, whether because
of its financial condition or actual or anticipated growth.
The Federal Reserve Board risk-based guidelines define a two-tier capital
framework. Tier 1 capital consists of common and qualifying preferred
shareholders' equity, less certain intangibles and other adjustments.
4
<PAGE>
Tier 2 capital consists of subordinated and other qualifying debt, and the
allowance for credit losses up to 1.25% of risk-weighted assets. The sum of Tier
1 and Tier 2 capital less investments in unconsolidated subsidiaries represents
qualifying total capital, at least 50% of which must consist of Tier 1 capital.
Risk-based capital ratios are calculated by dividing Tier 1 and total capital by
risk-weighted assets. Assets and off-balance sheet exposures are assigned to one
of four categories of risk-weights, based primarily on relative credit risk. The
minimum Tier 1 capital ratio is 4% and the minimum total capital ratio is 8%.
The Corporation's Tier 1 and total risk-based capital ratios under these
guidelines at June 30, 1996 were 7.58% and 11.93%, respectively.
The leverage ratio is determined by dividing Tier 1 capital by adjusted
average total assets. Although the stated minimum ratio is 3%, most banking
organizations are required to maintain ratios of at least 100 to 200 basis
points above 3%. The Corporation's leverage ratio at June 30, 1996 was 6.64%.
Management believes that NationsBank meets its leverage ratio requirement.
The Federal Deposit Insurance Corporation Improvement Act of 1991
("FDICIA"), among other things, identifies five capital categories for insured
depository institutions (well capitalized, adequately capitalized,
undercapitalized, significantly undercapitalized and critically
undercapitalized) and requires the respective Federal regulatory agencies to
implement systems for "prompt corrective action" for insured depository
institutions that do not meet minimum capital requirements within such
categories. FDICIA imposes progressively more restrictive constraints on
operations, management and capital distributions, depending on the category in
which an institution is classified. Failure to meet the capital guidelines could
also subject a banking institution to capital raising requirements. An
"undercapitalized" bank must develop a capital restoration plan and its parent
holding company must guarantee that bank's compliance with the plan. The
liability of the parent holding company under any such guarantee is limited to
the lesser of 5% of the bank's assets at the time it became "undercapitalized"
or the amount needed to comply with the plan. Furthermore, in the event of the
bankruptcy of the parent holding company, such guarantee would take priority
over the parent's general unsecured creditors. In addition, FDICIA requires the
various regulatory agencies to prescribe certain non-capital standards for
safety and soundness relating generally to operations and management, asset
quality and executive compensation and permits regulatory action against a
financial institution that does not meet such standards.
The various regulatory agencies have adopted substantially similar
regulations that define the five capital categories identified by FDICIA, using
the total risk-based capital, Tier 1 risk-based capital and leverage capital
ratios as the relevant capital measures. Such regulations establish various
degrees of corrective action to be taken when an institution is considered
undercapitalized. Under the regulations, a "well capitalized" institution must
have a Tier 1 capital ratio of at least 6%, a total capital ratio of at least
10% and a leverage ratio of at least 5% and not be subject to a capital
directive order. An "adequately capitalized" institution must have a Tier 1
capital ratio of at least 4%, a total capital ratio of at least 8% and a
leverage ratio of at least 4%, or 3% in some cases. Under these guidelines, as
of June 30, 1996, each of the Banks was considered well capitalized.
Banking agencies have recently adopted final regulations which mandate that
regulators take into consideration concentrations of credit risk and risks from
non-traditional activities, as well as an institution's ability to manage those
risks, when determining the adequacy of an institution's capital. This
evaluation will be made as a part of the institution's regular safety and
soundness examination. Banking agencies also have recently adopted final
regulations requiring regulators to consider interest rate risk (when the
interest rate sensitivity of an institution's assets does not match the
sensitivity of its liabilities or its off-balance-sheet position) in the
evaluation of a bank's capital adequacy. Concurrently, banking agencies have
proposed a methodology for evaluating interest rate risk. After gaining
experience with the proposed measurement process, these banking agencies intend
to propose further regulations to establish an explicit risk-based capital
charge for interest rate risk.
DISTRIBUTIONS. The Corporation's funds for cash distributions to its
shareholders are derived from a variety of sources, including cash and temporary
investments. The primary source of such funds, however, is dividends received
from the Banks. The amount of dividends that each Bank may declare in a calendar
year without approval of the Comptroller is the Bank's net profits for that
year, as defined by statute, combined with its net retained profits, as defined,
for the preceding two years. In addition, from time to time NationsBank applies
for, and may receive, permission from the Comptroller for one or more of the
Banks to declare special dividends. As of January 1, 1996, the Banks can
initiate dividend payments without prior regulatory approval of up
5
<PAGE>
to $905 million plus an additional amount equal to their net profits for 1996 up
to the date of any such dividend declaration.
In addition to the foregoing, the ability of NationsBank and the Banks to
pay dividends may be affected by the various minimum capital requirements and
the capital and non-capital standards established under FDICIA as described
above. Furthermore, the Comptroller may prohibit the payment of a dividend by a
national bank if it determines that such payment would constitute an unsafe or
unsound practice. The right of NationsBank, its shareholders and its creditors
to participate in any distribution of the assets or earnings of its subsidiaries
is further subject to the prior claims of creditors of the respective
subsidiaries.
SOURCE OF STRENGTH. According to Federal Reserve Board policy, bank holding
companies are expected to act as a source of financial strength to each
subsidiary bank and to commit resources to support each such subsidiary. This
support may be required at times when a bank holding company may not be able to
provide such support. In the event of a loss suffered or anticipated by the
FDIC -- either as a result of default of a banking or thrift subsidiary of
NationsBank or related to FDIC assistance provided to a subsidiary in danger of
default -- the other Banks may be assessed for the FDIC's loss, subject to
certain exceptions.
USE OF PROCEEDS
The net proceeds from the sale of the Debt Securities will be used for
general corporate purposes, including the Corporation's working capital needs,
the funding of investments in, or extensions of credit to, its banking and
nonbanking subsidiaries, possible acquisitions of other financial institutions
or their assets or liabilities, possible acquisitions of or investments in other
businesses of a type eligible for bank holding companies and possible reduction
of outstanding indebtedness or repurchase of outstanding equity securities of
the Corporation. Pending such use, the Corporation may temporarily invest the
net proceeds in investment grade securities. The Corporation may, from time to
time, engage in additional capital financings of a character and in amounts to
be determined by the Corporation in light of its needs at such time or times and
in light of prevailing market conditions. If the Corporation elects at the time
of issuance of Debt Securities to make different or more specific use of
proceeds other than that set forth herein, such use will be described in the
applicable Prospectus Supplement.
RATIOS OF EARNINGS TO FIXED CHARGES
The following are the Corporation's consolidated ratios of earnings to
fixed charges for the six months ended June 30, 1996 and for each of the years
in the five-year period ended December 31, 1995:
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED
JUNE 30, DECEMBER 31,
1996 1995 1994 1993 1992 1991
<S> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges:
Excluding interest on deposits......................................... 1.8 1.7 1.9 2.3 2.4 1.1
Including interest on deposits......................................... 1.4 1.4 1.5 1.5 1.4 1.0
</TABLE>
For purposes of computing the consolidated ratios, earnings represent net
income of the Corporation plus applicable income taxes and fixed charges, less
capitalized interest and the equity in undistributed earnings of unconsolidated
subsidiaries and associated companies. Fixed charges represent interest expense
(exclusive of interest on deposits in one case and inclusive of such interest in
the other), capitalized interest, amortization of debt discount and appropriate
issuance costs and one-third (the amount deemed to represent an appropriate
interest factor) of net rent expense under all lease commitments.
PLAN OF DISTRIBUTION
The Corporation may offer and sell the Debt Securities in one or more of
the following ways: (i) through underwriters or dealers; (ii) through agents; or
(iii) directly by the Corporation to one or more purchasers. Such underwriters,
dealers or agents may be affiliates of NationsBank. The Prospectus Supplement
with respect to a particular offering of a series of Debt Securities will set
forth the terms of the offering of such Debt Securities, including the name or
names of any underwriters or agents with whom NationsBank has entered
6
<PAGE>
into arrangements with respect to the sale of such Debt Securities, the public
offering or purchase price of such Debt Securities and the proceeds to the
Corporation from such sales, and any underwriting discounts, agency fees or
commissions and other items constituting underwriters' compensation, the initial
public offering price, any discounts or concessions to be allowed or reallowed
or paid to dealers and the securities exchange, if any, on which such Debt
Securities may be listed.
If underwriters are used in the offer and sale of Debt Securities, the Debt
Securities will be acquired by the underwriters for their own account and may be
resold from time to time in one or more transactions, including negotiated
transactions, at a fixed public offering price or at varying prices determined
at the time of sale. The Debt Securities may be offered to the public either
through underwriting syndicates represented by managing underwriters, or by
underwriters without a syndicate, all of which underwriters in either case will
be designated in the applicable Prospectus Supplement. Unless otherwise set
forth in the applicable Prospectus Supplement, under the terms of the
underwriting agreement, the obligations of the underwriters to purchase Debt
Securities will be subject to certain conditions precedent and the underwriters
will be obligated to purchase all the Debt Securities if any are purchased. Any
initial public offering price and any discounts or concessions allowed or
reallowed or paid to dealers may be changed from time to time.
Debt Securities also may be offered and sold directly by the Corporation or
through agents designated by the Corporation from time to time. Any agent
involved in the offer or sale of the Debt Securities with respect to which this
Prospectus is delivered will be named in, and any commissions payable by the
Corporation to such agent will be set forth in or calculable from, the
applicable Prospectus Supplement or a pricing supplement thereto. Unless
otherwise indicated in the Prospectus Supplement, any such agent will be acting
on a best efforts basis for the period of its appointment.
If so indicated in the applicable Prospectus Supplement, the Corporation
may authorize underwriters, dealers or agents to solicit offers by certain
institutions to purchase Debt Securities from the Corporation at the public
offering price set forth in such Prospectus Supplement pursuant to delayed
delivery contracts ("Delayed Delivery Contracts") providing for payment and
delivery on the date or dates stated in the Prospectus Supplement. Each Delayed
Delivery Contract will be for an amount of Debt Securities not less than and,
unless the Corporation otherwise agrees, the aggregate amount of Debt Securities
sold pursuant to Delayed Delivery Contracts shall be not more than the
respective minimum and maximum amounts stated in the Prospectus Supplement.
Institutions with which Delayed Delivery Contracts, when authorized, may be made
include commercial and savings banks, insurance companies, pension funds,
investment companies and educational and charitable institutions, but shall in
all cases be subject to the approval of the Corporation in its sole discretion.
The obligations of the purchaser under any Delayed Delivery Contract to pay for
and take delivery of Debt Securities will not be subject to any conditions
except that (i) the purchase of Debt Securities by such institution shall not at
the time of delivery be prohibited under the laws of the jurisdiction to which
such institution is subject; and (ii) any related sale of Debt Securities to
underwriters shall have occurred. A commission set forth in the Prospectus
Supplement will be paid to underwriters soliciting purchases of Debt Securities
pursuant to Delayed Delivery Contracts accepted by the Corporation. The
underwriters will not have any responsibility in respect of the validity or
performance of Delayed Delivery Contracts.
Any series of Debt Securities offered and sold pursuant to this Prospectus
and the applicable Prospectus Supplement will be new issues of securities with
no established trading market. Any underwriters to whom Debt Securities are sold
by the Corporation for public offering and sale may make a market in such Debt
Securities, but such underwriters will not be obligated to do so and may
discontinue any market making at any time without notice. No assurance can be
given as to the liquidity of the trading market for any Debt Securities.
Any underwriter, dealer or agent participating in the distribution of any
Debt Securities may be deemed to be an underwriter, as that term is defined in
the Securities Act of 1933, as amended (the "1933 Act"), of the Debt Securities
so offered and sold, and any discounts or commissions received by them from
NationsBank and any profit realized by them on the sale or resale of the Debt
Securities may be deemed to be underwriting discounts and commissions under the
1933 Act.
Under agreements entered into with the Corporation, underwriters, dealers
and agents may be entitled to indemnification by the Corporation against certain
civil liabilities, including liabilities under the 1933 Act, or to contribution
with respect to payments which the underwriters or agents may be required to
make in respect thereof.
7
<PAGE>
The participation of an affiliate or subsidiary of NationsBank in the offer
and sale of the Debt Securities will comply with the requirements of Section
2720 of the Conduct Rules of the National Association of Securities Dealers,
Inc. (the "NASD") regarding the participation in a distribution of securities by
an affiliate. No NASD member participating in offers and sales of the Debt
Securities will execute a transaction in the Debt Securities in a discretionary
account without the prior written specific approval of the member's customer.
This Prospectus and related Prospectus Supplements may also be used by
direct or indirect wholly-owned subsidiaries of NationsBank in connection with
offers and sales related to secondary market transactions in the Debt
Securities. Such subsidiaries may act as principal or agent in such
transactions. Any such sales will be made at prices related to prevailing market
prices at the time of sale.
Underwriters, dealers and agents also may be customers of, engage in
transactions with, or perform other services for the Corporation in the ordinary
course of business.
DESCRIPTION OF DEBT SECURITIES
THE FOLLOWING DESCRIPTION OF THE DEBT SECURITIES SETS FORTH CERTAIN GENERAL
TERMS AND PROVISIONS OF THE DEBT SECURITIES TO WHICH ANY PROSPECTUS SUPPLEMENT
MAY RELATE. THE PARTICULAR TERMS OF THE DEBT SECURITIES OFFERED BY ANY
PROSPECTUS SUPPLEMENT AND THE EXTENT, IF ANY, TO WHICH SUCH GENERAL PROVISIONS
MAY APPLY TO THE DEBT SECURITIES SO OFFERED WILL BE DESCRIBED IN THE PROSPECTUS
SUPPLEMENT RELATING TO SUCH DEBT SECURITIES.
Any Senior Debt Securities offered hereby are to be issued under an
Indenture dated as of January 1, 1995 (such Indenture, as it may be amended from
time to time, the "Senior Indenture") between the Corporation and First Trust of
New York, National Association, as successor Trustee to BankAmerica National
Trust Company (the "Senior Trustee"). Any Subordinated Debt Securities offered
hereby are to be issued under an Indenture dated as of January 1, 1995 (such
Indenture, as it may be amended from time to time, the "Subordinated Indenture")
between the Corporation and The Bank of New York, Trustee (the "Subordinated
Trustee" and, together with the Senior Trustee, the "Trustees"). Each of the
Senior Indenture and the Subordinated Indenture (each, an "Indenture" and
together, the "Indentures") is incorporated by reference in the Registration
Statement of which this Prospectus forms a part.
The following summaries of certain provisions of the Indentures do not
purport to be complete and are subject to and qualified in their entirety by
reference to the provisions of the applicable Indentures. Whenever particular
sections or defined terms of the Indentures are referred to, it is intended that
such sections or defined items shall be incorporated herein by reference. Unless
otherwise indicated, capitalized terms shall have the meanings ascribed to them
in the Indentures.
GENERAL
The respective Indentures provide that there is no limitation on the amount
of debt securities that may be issued thereunder from time to time. The amount
of Debt Securities that may be offered and sold pursuant to this Prospectus,
however, is limited to the aggregate initial offering price of the securities
registered under the Registration Statement of which this Prospectus forms a
part, subject to reduction as the result of the sale by the Corporation of other
securities under the Registration Statement.
The Debt Securities will be direct, unsecured obligations of the
Corporation. The Senior Debt Securities of each series will rank equally with
all unsecured senior debt of the Corporation. The Subordinated Debt Securities
of each series will be subordinate and junior in right of payment to the prior
payment in full of all Senior Indebtedness (as hereinafter defined) of the
Corporation. See "DESCRIPTION OF DEBT SECURITIES -- Subordination."
The Debt Securities will be issued in fully registered form without
coupons. The Debt Securities may be denominated in U.S. dollars or in another
currency or currency unit. Unless otherwise set forth in the applicable
Prospectus Supplement, any Debt Securities that are denominated in U.S. dollars
will be issued in denominations of $1,000 or an integral multiple thereof. If
any of the Debt Securities are denominated in a foreign currency or currency
unit, or if principal of (or premium, if any, on) or any interest on any of the
Debt Securities is payable in any foreign currency or currency unit, the
authorized denominations, as well as any investment considerations,
restrictions, tax consequences, specific terms and other information with
respect to such
8
<PAGE>
issue of Debt Securities and such foreign currency or currency unit, will be set
forth in the Prospectus Supplement relating thereto.
The Debt Securities may be issued in one or more series with the same or
various maturities. Certain Debt Securities may be issued which provide for an
amount less than the principal amount thereof to be due and payable in the event
of an acceleration of the maturity thereof (each an "Original Issue Discount
Security"). Original Issue Discount Securities may bear no interest or may bear
interest at a rate which at the time of issuance is below market rates and will
be sold at a discount (which may be substantial) below their stated principal
amount. Certain Debt Securities may be deemed to be issued with original issue
discount for United States Federal income tax purposes. The Prospectus
Supplement with respect to any series of Debt Securities issued with such
original issue discount will contain a discussion of Federal income tax
considerations with respect thereto.
The particular terms of each series of Debt Securities to be offered and
sold will be described in the Prospectus Supplement relating to such Debt
Securities, including: (1) the designation of the particular series; (2) the
aggregate principal amount of such series that may be authenticated and
delivered under the applicable Indenture; (3) the person to whom any interest on
any Debt Security of the series shall be payable, if other than the person in
whose name the Debt Security (or one or more predecessor Debt Securities) is
registered at the close of business on the regular record date for such
interest; (4) the date or dates on which the principal of the Debt Securities of
such series is payable; (5) the rate or rates, and if applicable the method used
to determine the rate, at which the Debt Securities of such series shall bear
interest, if any, the date or dates from which such interest shall accrue, the
date or dates on which such interest shall be payable and the record date or
dates for the interest payable on any Debt Securities on any interest payment
date; (6) the place or places at which, subject to the provisions of the
applicable Indenture, the principal of (and premium, if any, on) and any
interest on Debt Securities of such series shall be payable, any Debt Securities
of the series may be surrendered for registration of transfer, and notices and
demands to or upon the Corporation in respect of the Debt Securities of the
series and the Indenture may be served; (7) the obligation, if any, of the
Corporation to redeem or purchase Debt Securities of such series, at the option
of the Corporation or at the option of a holder thereof, pursuant to any sinking
fund or other redemption provisions and the period or periods within which, the
price or prices at which and the terms and conditions upon which Debt Securities
of the series may be so redeemed or purchased, in whole or in part; (8) if other
than denominations of $1,000 and any integral multiple thereof, the
denominations in which any Debt Securities of such series shall be issuable; (9)
if other than the principal amount thereof, the portion of the principal amount
of Debt Securities of such series which shall be payable upon declaration of
acceleration of the maturity thereof; (10) the currency, currencies or currency
units in which payment of the principal of (and premium, if any, on) and any
interest on any Debt Securities of the series shall be payable if other than the
currency of the United States of America and the manner of determining the
equivalent thereof in the currency of the United States of America for purposes
of the applicable Indenture; (11) if the principal of (and premium, if any, on)
or any interest on the Debt Securities of the series is to be payable, at the
election of the Corporation or a holder thereof, in one or more currencies or
currency units, other than that or those in which the Debt Securities are stated
to be payable, the currency or currencies in which payment of the principal of
(and premium, if any, on) and any interest on Debt Securities of such series as
to which such election is made shall be payable, and the periods within which
and the terms and conditions upon which such election is to be made; (12) if the
amount of payments of principal of (and premium, if any, on) or any interest on
the Debt Securities of the series may be determined with reference to an index,
the manner in which such amounts shall be determined; (13) whether the Debt
Securities will be issued in book-entry only form; (14) the identification or
method of selection of any interest rate calculation agents, exchange rate
calculation agents or other agents with respect to Debt Securities of such
series; (15) if either or both of Section 14.02 (defeasance) or Section 14.03
(covenant defeasance) of the applicable Indenture do not apply to the Debt
Securities of the series; (16) any provisions relating to the extension of
maturity of, or the renewal of, Debt Securities of such series; and (17) any
other terms of the Debt Securities of such series (which terms shall not be
inconsistent with the provisions of the applicable Indenture).
The ability of NationsBank to make payments of principal of (and premium,
if any, on) and any interest on the Debt Securities may be affected by the
ability of the Banks to pay dividends. The ability of the Banks, as well as of
the Corporation, to pay dividends in the future currently is, and could be
further, influenced by bank
9
<PAGE>
regulatory requirements and capital guidelines. See "NATIONSBANK
CORPORATION -- Supervision and Regulation."
Neither the Senior Indenture nor the Subordinated Indenture contains
provisions that would provide protection to holders of Debt Securities against a
decline in credit quality resulting from takeovers, recapitalizations, the
incurrence of additional indebtedness or similar restructurings by the
Corporation. If credit quality declines as a result of such an event, or
otherwise, the ratings of any Debt Securities then outstanding may be withdrawn
or downgraded.
CONVERSION
The Debt Securities of any series may be convertible, at the option of the
holder or the Corporation, into Preferred Stock, Depositary Shares, Common Stock
or other Debt Securities if the Prospectus Supplement relating to such series of
Debt Securities so provides. In such case, such Prospectus Supplement will set
forth (i) the period(s) during which such conversion may be elected; (ii) the
conversion price payable and the number of shares or amount of Preferred Stock,
Depositary Shares, Common Stock or other Debt Securities purchaseable upon
conversion, and adjustments thereto, if any, in certain events; (iii) the
procedures for electing such conversion; and (iv) all other terms for such
conversion (which terms shall not be inconsistent with the provisions of the
applicable Indenture).
EXCHANGE, REGISTRATION AND TRANSFER
At the option of the holder, subject to the terms of the applicable
Indenture, Debt Securities of any series (other than Debt Securities issued in
book-entry form) will be exchangeable for other Debt Securities of the same
series and of an equal aggregate principal amount and tenor of any authorized
denominations.
Debt Securities of a series may be presented for exchange as provided
above, and may be presented for registration of transfer (with the form of
transfer endorsed thereon duly executed), at the office of the Security
Registrar or at the office of any transfer agent of the Corporation designated
and maintained for such purpose with respect to such Debt Securities pursuant to
the terms of the applicable Indenture, as referred to in an applicable
Prospectus Supplement. Such transfer or exchange will be effected upon the
Security Registrar or transfer agent, as the case may be, being satisfied with
the documents of title and identity of the person making the request. No service
charge shall be made for any exchange or registration of transfer of Debt
Securities, but the Corporation may require payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in connection
therewith.
If a Prospectus Supplement refers to any transfer agents (in addition to
the Security Registrar) designated by the Corporation with respect to any series
of Debt Securities, the Corporation may at any time rescind the designation of
any such transfer agent or approve a change in the location through which any
such transfer agent acts, except that the Corporation will be required to
maintain a transfer agent in each place of payment for such series. The
Corporation may at any time designate additional transfer agents with respect to
any series of Debt Securities.
The Corporation shall not be required to (i) issue, exchange or register
the transfer of any Debt Security of any series to be redeemed for a period of
15 days next preceding any selection of such Debt Securities to be redeemed; or
(ii) exchange or register the transfer of any Debt Security so selected, called
or being called for redemption, except the unredeemed portion of any Debt
Security being redeemed in part.
For a discussion of restrictions on the exchange, registration and transfer
of Global Securities (hereinafter defined), see "REGISTRATION AND SETTLEMENT."
PAYMENT AND PAYING AGENTS
Unless otherwise indicated in an applicable Prospectus Supplement,
principal of (and premium, if any, on) and any interest on Debt Securities will
be payable, subject to any applicable laws and regulations, at the offices of
such paying agents as the Corporation may designate from time to time pursuant
to the applicable Indenture, except that, at the option of the Corporation,
payment of any interest may be made by check mailed to the address of the person
entitled thereto as such address shall appear in the Security Register. Unless
otherwise indicated in an applicable Prospectus Supplement, payment of interest
on a Debt Security on any
10
<PAGE>
interest payment date generally will be made to the person in whose name such
Debt Security is registered at the close of business on the regular record date
for such interest payment date. For a discussion of payment of principal and any
premium or interest with respect to Global Securities, see "REGISTRATION AND
SETTLEMENT."
The Corporation initially has designated the principal corporate trust
offices of the Senior Trustee and the Subordinated Trustee in the City of New
York as the places where the Senior Debt Securities and Subordinated Debt
Securities, respectively, may be presented for payment. The Corporation may at
any time designate additional paying agents or rescind the designation of any
paying agent or approve a change in the office through which any paying agent
acts. Any other paying agents designated by the Corporation for the Debt
Securities of each series will be named in an applicable Prospectus Supplement.
SUBORDINATION
The Subordinated Debt Securities are subordinate and subject, to the extent
and in the manner set forth in the Subordinated Indenture, in right of payment
to the prior payment in full of all Senior Indebtedness of the Corporation.
"Senior Indebtedness" is defined by the Subordinated Indenture as any
indebtedness for money borrowed (including all indebtedness of the Corporation
for borrowed and purchased money of the Corporation, all obligations of the
Corporation arising from off-balance sheet guarantees by the Corporation and
direct credit substitutes, and obligations of the Corporation associated with
derivative products such as interest and foreign exchange rate contracts and
commodity contracts) that is outstanding on the date of execution of the
Subordinated Indenture, or is thereafter created, incurred or assumed, for the
payment of which the Corporation is at the time of determination responsible or
liable as obligor, guarantor or otherwise, and all deferrals, renewals,
extensions and refundings of any such indebtedness or obligations, other than
the Subordinated Debt Securities or any other indebtedness as to which, in the
instrument creating or evidencing the same or pursuant to which the same is
outstanding, it is provided that such indebtedness is subordinate in right of
payment to any other indebtedness of the Corporation. The Prospectus Supplement
relating to each series of Subordinated Debt Securities will set forth the
aggregate amount of then outstanding Senior Indebtedness of the Corporation and
any limitation on the issuance of additional Senior Indebtedness.
No payment on account of principal of (and premium, if any, on) or any
interest on the Subordinated Debt Securities shall be made, and no Subordinated
Debt Securities shall be purchased, either directly or indirectly, by the
Corporation or any of its subsidiaries, if any default or event of default with
respect to any Senior Indebtedness shall have occurred and be continuing and the
Corporation and the Subordinated Trustee shall have received written notice
thereof from the holders of at least 10% in principal amount of any kind or
category of any Senior Indebtedness (or the representative or representatives of
such holders) or the Subordinated Trustee shall have received written notice
thereof from the Corporation.
In the event that any Subordinated Debt Security is declared due and
payable before the date specified therein as the fixed date on which the
principal thereof is due and payable pursuant to the Subordinated Indenture, or
upon any payment or distribution of assets of the Corporation of any kind or
character to creditors upon any dissolution or winding up or total or partial
liquidation or reorganization of the Corporation, all principal of (and premium,
if any, on) and any interest due or to become due upon all Senior Indebtedness
shall first be paid in full before the holders of the Subordinated Debt
Securities (the "Subordinated Debt Holders"), or the Subordinated Trustee, shall
be entitled to retain any assets (other than shares of stock of the Corporation
as reorganized or readjusted or securities of the Corporation or any other
corporation provided for by a plan of reorganization or readjustment, the
payment of which is subordinated, at least to the same extent as the
Subordinated Debt Securities, to the payment of all Senior Indebtedness which
may at the time be outstanding, provided that the rights of the holders of the
Senior Indebtedness are not altered by such reorganization or readjustment), so
paid or distributed in respect of the Subordinated Debt Securities (for
principal or interest, if any). Upon such dissolution or winding up or
liquidation or reorganization, any payment or distribution of assets of the
Corporation of any kind or character, whether in cash, property or securities
(other than shares of stock of the Corporation as reorganized or readjusted or
securities of the Corporation or any other corporation provided for by a plan of
reorganization or readjustment, the payment of which is subordinated, at least
to the same extent as the Subordinated Debt Securities, to the payment of all
Senior Indebtedness which may at the time be outstanding, provided that the
rights of the holders of the Senior Indebtedness are not altered by such
reorganization or readjustment), to which the Subordinated Debt Holders or the
Subordinated Trustee would be entitled, except for the subordination provisions
of the Subordinated Indenture, shall be paid
11
<PAGE>
by the Corporation or by any receiver, trustee in bankruptcy, liquidating
trustee, agent or other person making such payment or distribution, or by the
Subordinated Debt Holders or the Subordinated Trustee if received by them or it,
directly to the holders of the Senior Indebtedness (pro rata to each such holder
on the basis of the respective amounts of Senior Indebtedness held by such
holder) or their representatives, to the extent necessary to pay all Senior
Indebtedness in full, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Indebtedness, before any payment or
distribution is made to the Subordinated Debt Holders or to the Subordinated
Trustee.
Subject to the payment in full of all Senior Indebtedness, the Subordinated
Debt Holders shall be subrogated (equally and ratably with the holders of all
indebtedness of the Corporation which, by its express terms, ranks on a parity
with the Subordinated Debt Securities and is entitled to like rights of
subrogation) to the rights of the holders of Senior Indebtedness to receive
payments or distributions of assets of the Corporation applicable to the Senior
Indebtedness until the Subordinated Debt Securities shall be paid in full.
SALE OR ISSUANCE OF CAPITAL STOCK OF BANKS
The Senior Indenture prohibits the issuance, sale or other disposition of
capital stock, or securities convertible into or options, warrants or rights to
acquire capital stock, of any Principal Subsidiary Bank (as defined below) or of
any subsidiary which owns shares of capital stock, or securities convertible
into or options, warrants or rights to acquire capital stock, of any Principal
Subsidiary Bank, with the following exceptions: (a) sales of directors'
qualifying shares; (b) sales or other dispositions for fair market value, if,
after giving effect to such disposition and to conversion of any shares or
securities convertible into capital stock of a Principal Subsidiary Bank, the
Corporation would own directly or indirectly not less than 80% of each class of
the capital stock of such Principal Subsidiary Bank (or any successor
corporation thereto); (c) sales or other dispositions made in compliance with an
order of a court or regulatory authority of competent jurisdiction; (d) any sale
by a Principal Subsidiary Bank (or any successor corporation thereto) of
additional shares of its capital stock to its shareholders at any price, so long
as (i) prior to such sale the Corporation owns, directly or indirectly, shares
of the same class and (ii) immediately after such sale, the Corporation owns,
directly or indirectly, at least as great a percentage of each class of capital
stock of such Principal Subsidiary Bank as it owned prior to such sale of
additional shares; (e) any sale by a Principal Subsidiary Bank (or any successor
corporation thereto) of additional securities convertible into shares of its
capital stock to its shareholders at any price, so long as (i) prior to such
sale the Corporation owns, directly or indirectly, securities of the same class
and (ii) immediately after such sale the Corporation owns, directly or
indirectly, at least as great a percentage of each class of such securities
convertible into shares of capital stock of such Principal Subsidiary Bank as it
owned prior to such sale of additional securities; (f) any sale by a Principal
Subsidiary Bank (or any successor corporation thereto) of additional options,
warrants or rights to subscribe for or purchase shares of its capital stock to
its shareholders at any price, so long as (i) prior to such sale the Corporation
owns, directly or indirectly, options, warrants or rights, as the case may be,
of the same class and (ii) immediately after such sale, the Corporation owns,
directly or indirectly, at least as great a percentage of each class of such
options, warrants or rights, as the case may be, to subscribe for or purchase
shares of capital stock of such Principal Subsidiary Bank as it owned prior to
such sale of additional options, warrants or rights; or (g) any issuance of
shares of capital stock, or securities convertible into or options, warrants or
rights to subscribe for or purchase shares of capital stock, of a Principal
Subsidiary Bank or any subsidiary which owns shares of capital stock, or
securities convertible into or options, warrants or rights to acquire capital
stock, of any Principal Subsidiary Bank, to the Corporation or a wholly owned
subsidiary of the Corporation.
A Principal Subsidiary Bank is defined in the Senior Indenture as any Bank
(other than NationsBank of Delaware, National Association) with total assets
equal to more than 10% of the Corporation's total consolidated assets.
WAIVER OF COVENANTS
Under the terms of either Indenture, compliance with certain covenants or
conditions of such Indenture may be waived by the holders of a majority in
principal amount of the Debt Securities of all series to be affected thereby and
at the time outstanding under that Indenture (including, in the case of holders
of Senior Debt Securities, the covenant described above).
12
<PAGE>
MODIFICATION OF THE INDENTURES
Each Indenture contains provisions permitting the Corporation and the
applicable Trustee to modify such Indenture or the rights of the holders of Debt
Securities thereunder, with the consent of the holders of not less than 66 2/3%
in aggregate principal amount of the Debt Securities of all series at the time
outstanding under that Indenture and to be affected thereby (voting as one
class), except that no such modification shall (a) extend the fixed maturity of,
reduce the principal amount or redemption premium, if any, of, or reduce the
rate of or extend the time of payment of interest on, any Debt Security without
the consent of the holder of each security so affected, or (b) reduce the
aforesaid percentage of Debt Securities, the consent of holders of which is
required for any such modification, without the consent of the holders of all
Debt Securities then outstanding under that Indenture. Each Indenture also
provides that the Corporation and the respective Trustee may, from time to time,
execute supplemental indentures in certain limited circumstances without the
consent of any holders of outstanding Debt Securities.
Each Indenture provides that in determining whether the holders of the
requisite principal amount of the Debt Securities outstanding have given any
request, demand, authorization, direction, notice, consent or waiver thereunder,
(i) the principal amount of an Original Issue Discount Security that shall be
deemed to be outstanding shall be the amount of the principal thereof that would
be due and payable at such time upon an event of default, and (ii) the principal
amount of a Debt Security denominated in a foreign currency or currency unit
shall be the U.S. dollar equivalent on the date of original issuance of such
Debt Security.
MEETINGS AND ACTION BY SECURITYHOLDERS
Each Indenture contains provisions for convening meetings of the holders of
Debt Securities for certain purposes. A meeting may be called at any time by the
Trustee in its discretion and shall be called by the Trustee upon request by the
Corporation or the holders of at least 10% in aggregate principal amount of the
Debt Securities outstanding of such series, in any case upon notice given in
accordance with "Notices" below. Any resolution passed or decision taken at any
meeting of holders of Debt Securities of any series duly held in accordance with
the applicable Indenture, or such other action taken in accordance with the
terms of the applicable Indenture, will be binding on all holders of Debt
Securities of that series.
DEFAULTS AND RIGHTS OF ACCELERATION
An Event of Default is defined in the Subordinated Indenture generally as
bankruptcy of the Corporation under Federal bankruptcy laws. An Event of Default
is defined in the Senior Indenture generally as (i) the Corporation's failure to
pay principal (or premium, if any) when due on any securities of a series; (ii)
the Corporation's failure to pay interest on any securities of a series, within
30 days after the same becomes due; (iii) the Corporation's breach of any of its
other covenants contained in the Senior Debt Securities or the Senior Indenture,
which breach is not cured within 90 days after written notice to the Corporation
by the Senior Trustee, or to the Corporation and the Senior Trustee by the
holders of at least 25% in principal amount of all Senior Debt Securities then
outstanding under the Senior Indenture and affected thereby; and (iv) certain
events involving the bankruptcy, insolvency or liquidation of the Corporation.
Each Indenture provides that if an Event of Default under the respective
Indenture occurs and is continuing, either the respective Trustee or the holders
of 25% in principal amount (or, if any such Debt Securities are Original Issue
Discount Debt Securities, such lesser amounts as may be described in an
applicable Prospectus Supplement) of the Debt Securities then outstanding under
that Indenture (or, with respect to an Event of Default under the Senior
Indenture due to a default in the payment of principal (or premium, if any) or
interest or performance of any other covenant, the outstanding Debt Securities
of all series affected by such default) may declare the principal amount of all
of such Debt Securities to be due and payable immediately. Payment of principal
of the Subordinated Debt Securities may not be accelerated in the case of a
default in the payment of principal (or premium, if any) or interest or the
performance of any other covenant of the Corporation. Upon certain conditions a
declaration of an Event of Default may be annulled and past defaults may be
waived by the holders of a majority in principal amount of the Debt Securities
then outstanding (or of such series affected, as the case may be).
13
<PAGE>
COLLECTION OF INDEBTEDNESS, ETC.
Each Indenture also provides that in the event of a failure by the
Corporation to make payment of principal of (and premium, if any, on) or any
interest on the Debt Securities (and, in the case of payment of interest, such
failure to pay shall have continued for 30 days) and upon the demand of the
respective Trustee, the Corporation will pay to such Trustee, for the benefit of
the holders of the Debt Securities, the amount then due and payable on the Debt
Securities for principal and interest, with interest on the overdue principal
and, to the extent payment of interest shall be legally enforceable, upon
overdue installments of interest at the rate borne by the Debt Securities. Each
Indenture further provides that if the Corporation fails to pay such amount
forthwith upon such demand, the respective Trustee may, among other things,
institute a judicial proceeding for the collection thereof. However, each
Indenture provides that notwithstanding any other provision of the Indenture,
the holder of any Debt Security shall have the right to institute suit for the
enforcement of any payment of principal of (and premium, if any, on) and any
interest on such Debt Security on the respective stated maturities expressed in
such Debt Security and that such right shall not be impaired without the consent
of such holder.
The holders of a majority in principal amount of the Debt Securities then
outstanding under an Indenture shall have the right to direct the time, method
and place of conducting any proceeding for any remedy available to the Trustee
under that Indenture, provided that the holders shall have offered to the
Trustee reasonable indemnity against expenses and liabilities. Each Indenture
requires the annual filing by the Corporation with the respective Trustee of a
certificate as to the absence of default and as to compliance with the terms of
that Indenture.
NOTICES
Except as otherwise provided in the applicable Indenture, notices to
holders of Debt Securities will be given by first-class mail to the addresses of
such holders as they appear in the Security Register.
CONCERNING THE TRUSTEES
The Corporation and the Banks have from time to time maintained deposit
accounts and conducted other banking transactions with The Bank of New York and
First Trust of New York, National Association, and their affiliated entities in
the ordinary course of business. Each of the Trustees also serves as trustee for
certain series of the Corporation's outstanding indebtedness under other
indentures.
REGISTRATION AND SETTLEMENT
DTC
If so specified in an applicable Prospectus Supplement, all or any portion
of the Debt Securities of a series may be issued in book-entry form represented
by one or more global Debt Securities in registered form (each, a "Global
Security"). Unless otherwise specified in such Prospectus Supplement, each such
Global Security will be held through The Depository Trust Company ("DTC"), as
depositary, and will be registered in the name of Cede & Co., as nominee of DTC.
Under the book-entry system of DTC, purchases of Debt Securities of a
series represented by a Global Security must be made by or through persons that
have accounts with DTC ("DTC Participants") or persons that may hold interests
through DTC Participants ("Indirect Participants"). Upon the issuance and
deposit of a Global Security, DTC will credit, on its book-entry registration
and transfer system, the respective principal amounts of the individual Debt
Securities represented by such Global Security to the accounts of DTC
Participants. The accounts to be credited will be designated by the underwriters
or agents of such Debt Securities (or by the Corporation, if such Debt
Securities are offered and sold directly by the Corporation). The ownership of
beneficial interests in such Global Security will be shown on, and the transfer
of that ownership will be effected only through, records maintained by DTC (with
respect to interests of DTC Participants) and the records of DTC Participants
(with respect to interests of Indirect Participants) and Indirect Participants.
The laws of some jurisdictions require that certain purchasers of securities
take physical delivery of such securities in certificated form. Such limits and
laws may impair the ability to own, transfer or pledge beneficial interests in a
Global Security.
14
<PAGE>
So long as DTC or its nominee is the registered holder of a Global
Security, DTC or its nominee, as applicable, will be considered the sole owner
or holder of the Debt Securities represented by such Global Security for all
purposes under the applicable Indenture. Except as provided below, owners of
beneficial interests in a Global Security will not be entitled to have Debt
Securities registered in their names, will not receive or be entitled to receive
physical delivery of such Debt Securities in certificated form and will not be
considered the owners or holders thereof under the applicable Indenture.
Accordingly, in order to exercise any rights of a holder of the Debt Securities
under the applicable Indenture, each person owning a beneficial interest in the
Global Security representing such Debt Securities must rely on the procedures of
DTC or, if such person is not a DTC Participant, on the procedures of the DTC
Participant and, if applicable, the Indirect Participant, through which such
person owns its interest.
So long as DTC or its nominee is the registered holder of a Global
Security, Debt Securities of the series represented by such Global Security will
trade in DTC's Same Day Fund Settlement System, and secondary market trading
activity in such Debt Securities will therefore be required by DTC to settle in
immediately available funds. No assurance can be given as to the effect, if any,
of settlement in immediately available funds on trading activity in such Debt
Securities.
Except as otherwise provided herein, DTC or its nominee, as applicable, as
the registered holder of a Global Security shall be the only person entitled to
receive payments from the Corporation with respect to Debt Securities of the
series represented by such Global Security. Accordingly, payments of principal
of (and premium, if any, on) and any interest on individual Debt Securities of
the series represented by such a Global Security will be made by the Corporation
only to DTC or its nominee, as applicable. DTC has advised the Corporation that
it is DTC's practice to credit DTC Participants' accounts on the payable date in
accordance with their respective holdings with respect to a Global Security as
shown on DTC's records, unless DTC has reason to believe that it will not
receive payment on such date. Payments by DTC Participants to beneficial owners
are governed by standing instructions and customary practices, as is the case
with securities held in "street name." Such instructions will be the
responsibility of such DTC Participant and not of DTC, the Corporation or any
underwriter or agent for the Debt Securities of the series represented by such
Global Security, subject to any statutory or regulatory requirements as may be
in effect from time to time. The Corporation will in every case be discharged by
payment to, or to the order of, DTC or its nominee, as applicable, as the
registered holder of such Global Security, of the amount so paid. Each of the
persons shown in the records of DTC or its nominee as an owner of a beneficial
interest in such Global Security must look solely to DTC or its nominee, as the
case may be, for its share of any such payment so made by the Corporation.
Neither the Corporation, the Trustee for the Debt Securities of the series
represented by such Global Security, any paying agent or authenticating agent
for such Debt Securities nor the Security Registrar or transfer agent for such
Debt Securities will have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial interests in the
Global Security representing such Debt Securities or for maintaining,
supervising or reviewing any records relating to such beneficial interests.
DTC has advised the Corporation as follows: DTC is a limited-purpose trust
company organized under New York law, a "banking organization" within the
meaning of New York law, a member of the Federal Reserve System, a "clearing
corporation" within the meaning of the Uniform Commercial Code as in effect in
the state of New York and a "clearing agency" registered pursuant to the
provisions of Section 17A of the 1934 Act. DTC was created to hold securities
deposited by DTC Participants and to facilitate the clearance and settlement of
securities transactions among DTC Participants in such securities through
electronic computerized book-entry changes in accounts of the DTC Participants,
thereby eliminating the need for physical movement of securities certificates.
DTC's direct DTC Participants include securities brokers and dealers, banks
(including certain subsidiaries of the Corporation), trust companies, clearing
corporations and certain other organizations, some of whom (and/or their
representatives) have ownership interests in DTC. DTC is owned by a number of
its DTC Participants and by the New York Stock Exchange, Inc., the American
Stock Exchange, Inc. and the NASD. Indirect access to DTC's book-entry system is
also available to Indirect Participants, such as banks, brokers, dealers and
trust companies that clear through or maintain a custodial relationship with a
DTC Participant, either directly or indirectly. The rules applicable to DTC and
DTC Participants are on file with the Commission.
To facilitate subsequent transfers, all securities deposited with DTC are
registered in the name of DTC's partnership nominee, Cede & Co. The deposit of
securities with DTC and their registration in the name of Cede
15
<PAGE>
& Co. effect no change in beneficial ownership. DTC has no knowledge of the
actual beneficial owners of securities deposited with it; DTC's records reflect
only the identity of the DTC Participants to whose accounts such securities are
credited, which may or may not be the beneficial owners. The DTC Participants
will remain responsible for keeping account of their holdings on behalf of their
customers. Conveyance of notices and other communications by DTC to DTC
Participants, by DTC Participants to Indirect Participants, and by DTC
Participants and Indirect Participants to beneficial owners, will be governed by
arrangements among them, subject to any statutory or regulatory requirements as
may be in effect from time to time. Neither DTC nor Cede & Co. will consent or
vote with respect to securities held by DTC. Under its usual procedures, DTC
mails an omnibus proxy to an issuer as soon as possible after the record date.
The omnibus proxy assigns Cede & Co.'s consenting or voting rights to those DTC
Participants to whose accounts the securities are credited on the record date
(identified in a listing attached to the omnibus proxy).
DTC can act only on behalf of DTC Participants, who in turn act on behalf
of Indirect Participants. Owners of beneficial interests in a Global Security
that are not DTC Participants or Indirect Participants but desire to purchase,
sell or otherwise transfer ownership of such interests may do so only through
DTC Participants and Indirect Participants. In addition, the ability of owners
of beneficial interests in a Global Security to pledge such interests to persons
or entities that do not participate in the DTC system may be limited due to the
lack of certificates for the Debt Securities of the series represented by such
Global Security.
Although DTC has agreed to the foregoing procedures in order to facilitate
transfers of beneficial interests in Global Securities among DTC Participants,
it is under no obligation to perform or continue to perform such procedures, and
such procedures may be discontinued at any time.
If DTC is at any time unwilling, unable or ineligible to continue as a
depositary with respect to Debt Securities of a particular series and a
successor depositary is not appointed by the Corporation within 90 days, the
Corporation will issue Debt Securities of the series in certificated form in
exchange for beneficial interests in the Global Security representing such Debt
Securities. In addition, the Corporation may at any time determine not to have
Debt Securities of a series represented by Global Securities and, in such event,
will issue Debt Securities of the series in certificated form in exchange for
beneficial interests in the Global Security representing such Debt Securities.
In any such instance, an owner of a beneficial interest in the Global Security
will be entitled to physical delivery in certificated form of a note or notes
representing such Debt Securities equal in principal amount to such beneficial
interest and to have such note or notes registered in its name. Unless otherwise
specified in the applicable Prospectus Supplement, any notes so issued in
certificated form will be issued in denominations of $1,000 or any integral
multiple in excess thereof and will be issued in registered form only, without
coupons.
CEDEL BANK AND EUROCLEAR
If so specified in the applicable Prospectus Supplement, Debt Securities of
a series to be issued in book-entry form and to be sold or traded in Europe may
be represented by one or more Global Securities held through Cedel Bank, societe
anonyme ("Cedel Bank") or Morgan Guaranty Trust Company of New York, Brussels
office, as operator of the Euroclear System (the "Euroclear Operator" or
"Euroclear"). Cedel Bank and Euroclear will hold omnibus positions on behalf of
Cedel Bank Participants and Euroclear Participants (each as hereinafter
defined), respectively, on the books of their respective depositaries (each, a
"Depositary"), which in turn will hold such positions on the books of DTC.
Transfers between Cedel Bank Participants and Euroclear Participants will
occur in the ordinary way in accordance with their applicable rules and
operating procedures. Cross-market transfers between persons holding directly or
indirectly through DTC in the United States, on the one hand, and directly or
indirectly through Cedel Bank Participants or Euroclear Participants, on the
other, will be effected by DTC in accordance with DTC rules on behalf of the
relevant European international clearing system by its Depositary. Such cross-
market transactions, however, will require delivery of instructions to the
relevant European international clearing system by the counterparty in such
system in accordance with its rules and procedures and within its established
deadlines (European time). The relevant European international clearing system
will, if the transaction meets its settlement requirements, deliver instructions
to its Depositary to take action to effect final settlement on its behalf by
delivering or receiving securities in DTC, and making or receiving in accordance
16
<PAGE>
with normal procedures for same-day funds settlement applicable to DTC. Cedel
Bank Participants and Euroclear Participants may not deliver instructions
directly to the Depositaries.
Because of time-zone differences, credits for securities in Cedel Bank or
Euroclear as a result of a transaction with a DTC Participant will be made
during the subsequent securities settlement processing, and will be dated the
business day following the DTC settlement date, and such credits or any
transactions in such securities settled during such processing will be reported
to the relevant Cedel Bank Participant or Euroclear Participant on such business
day. Cash received in Cedel Bank or Euroclear as a result of sales of securities
by or through a Cedel Bank Participant or a Euroclear Participant to a DTC
Participant will be received with value on the DTC settlement date but will be
available in the relevant Cedel Bank or Euroclear cash account only as of the
business day following settlement in DTC.
Cedel Bank is incorporated under the laws of Luxembourg as a professional
depository. Cedel Bank holds securities for its participating organizations
("Cedel Participants") and facilitates the clearance and settlement of
securities transactions between Cedel Participants through electronic book-entry
changes in accounts of Cedel Participants, thereby eliminating the need for
physical movement of certificates. Transactions may be settled by Cedel Bank in
any of 28 currencies, including United States dollars. Cedel Bank provides to
its Cedel Participants, among other things, services for safekeeping,
administration, clearance and settlement of internationally traded securities
and securities lending and borrowing. Cedel Bank interfaces with domestic
markets in several countries. As a professional depository, Cedel Bank is
subject to regulation by the Luxembourg Monetary Institute. Cedel Participants
consist of recognized financial institutions around the world, including
underwriters, securities brokers and dealers, banks, trust companies, clearing
corporations and certain other organizations and may include the underwriters or
agents with respect to a particular series of Debt Securities. Indirect access
to Cedel Bank is also available to others, such as banks, brokers, dealers and
trust companies that clear through or maintain a custodial relationship with a
Cedel Participant, either directly or indirectly.
The Euroclear System (the "Euroclear System") was created in 1968 to hold
securities for participants of the Euroclear System ("Euroclear Participants")
and to clear and settle transactions between Euroclear Participants through
simultaneous electronic book-entry delivery against payment, thereby eliminating
the need for physical movement of certificates and any risk from lack of
simultaneous transfers of securities and cash. Transactions now may be settled
by Euroclear in any of 32 currencies, including United States dollars. The
Euroclear System includes various other services, including securities lending
and borrowing and interfaces with domestic markets in several countries
generally similar to the arrangements for cross-market transfers with DTC
described above. The Euroclear System is operated by the Euroclear Operator,
under contract with Euroclear Clearance System, S.C., a Belgian cooperative
corporation (the "Cooperative"). All operations are conducted by the Euroclear
Operator, and all Euroclear securities clearance accounts and Euroclear cash
accounts are accounts with the Euroclear Operator, not the Cooperative. The
Cooperative establishes policy for the Euroclear System on behalf of Euroclear
Participants. Euroclear Participants include banks (including central banks),
securities brokers and dealers and other professional financial intermediaries
and may include the underwriters or agents with respect to a particular series
of Debt Securities. Indirect access to the Euroclear System is also available to
other firms that clear through or maintain a custodial relationship with a
Euroclear Participant, either directly or indirectly.
The Euroclear Operator is the Brussels branch of a New York banking
corporation that is a member bank of the Federal Reserve System. As such, it is
regulated and examined by the Federal Reserve Board and the New York State
Banking Department, as well as the Belgian Banking Commission.
Securities clearance accounts and cash accounts with the Euroclear Operator
are governed by the Terms and Conditions Governing Use of Euroclear and the
related Operating Procedures of the Euroclear System and applicable Belgian law
(collectively, the "Terms and Conditions"). The Terms and Conditions govern
transfers of securities and cash within the Euroclear System, withdrawal of
securities and cash from the Euroclear System and receipts of payments with
respect to securities in the Euroclear System. All securities in the Euroclear
System are held on a fungible basis without attribution of specific certificates
to specific securities clearance accounts. The Euroclear Operator acts under the
Terms and Conditions only on behalf of Euroclear Participants and has no record
of or relations with persons holding through Euroclear Participants.
Distributions with respect to Debt Securities of a series held through
Cedel Bank or Euroclear will be credited to the cash accounts of Cedel
Participants or Euroclear Participants in accordance with the relevant
17
<PAGE>
system's rules and procedures, to the extent received by its respective
Depositary. Such distributions will be subject to tax reporting in accordance
with relevant United States tax laws and regulations. The applicable Prospectus
Supplement with respect to a series of Debt Securities held through Cedel Bank
or Euroclear will set forth certain income tax consequences to foreign
investors. Cedel Bank or the Euroclear Operator, as the case may be, will take
any other action permitted to be taken by a holder of Debt Securities under the
applicable Indenture on behalf of a Cedel Participant or a Euroclear Participant
only in accordance with its relevant rules and procedures and subject to its
respective Depositary's ability to effect such actions on its behalf through
DTC.
Although Cedel Bank and Euroclear have agreed to the foregoing procedures
in order to facilitate transfers of applicable Debt Securities among
participants of DTC, Cedel Bank and Euroclear, they are under no obligation to
perform or continue to perform such procedures, and such procedures may be
discontinued at any time.
LEGAL OPINIONS
The legality of the Debt Securities will be passed upon for the Corporation
by Smith Helms Mulliss & Moore, L.L.P., Charlotte, North Carolina, and for the
underwriters or agents by Stroock & Stroock & Lavan, New York, New York. As of
the date of this Prospectus, certain members of Smith Helms Mulliss & Moore,
L.L.P. beneficially own approximately 50,000 shares of the Corporation's Common
Stock.
EXPERTS
The consolidated financial statements of the Corporation incorporated in
this Prospectus by reference to the Corporation's Annual Report on Form 10-K for
the year ended December 31, 1995, have been so incorporated in reliance on the
report of Price Waterhouse LLP, independent accountants, given on the authority
of said firm as experts in auditing and accounting.
18
<PAGE>
NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS IN CONNECTION WITH THE OFFERING MADE HEREBY AND, IF GIVEN OR MADE,
SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE CORPORATION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY
SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE AN IMPLICATION THAT
THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE CORPORATION SINCE THE DATE
HEREOF. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER OR SOLICITATION BY ANYONE
IN ANY STATE IN WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED OR IN WHICH
THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO OR TO
ANYONE TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PROSPECTUS PAGE
<S> <C>
Incorporation of Certain Documents by
Reference.................................... 2
Available Information.......................... 2
NationsBank Corporation........................ 3
Use of Proceeds................................ 6
Ratios of Earnings to Fixed Charges............ 6
Plan of Distribution........................... 6
Description of Debt Securities................. 8
Registration and Settlement.................... 14
Legal Opinions................................. 18
Experts........................................ 18
</TABLE>
$3,000,000,000
NATIONSBANK(Register Mark)
DEBT SECURITIES
PROSPECTUS
, 1996
<PAGE>
SUBJECT TO COMPLETION [ALTERNATE PAGE -- DEBT]
PRELIMINARY PROSPECTUS DATED OCTOBER 9, 1996
[DEBT]
PROSPECTUS
NATIONSBANK(Register Mark)
Debt Securities
NationsBank Corporation ("NationsBank" or the "Corporation") may offer from
time to time its unsecured debt securities, which may be either senior (the
"Senior Debt Securities") or subordinated (the "Subordinated Debt Securities"
and, together with the Senior Debt Securities, the "Debt Securities").
NationsBank may sell up to $3,000,000,000 in aggregate initial offering price of
Debt Securities (or the U.S. dollar equivalent thereof if any of the Debt
Securities are denominated in a foreign currency or currency unit), which may be
offered, separately or together, in one or more series, in amounts, at prices
and on terms to be determined at the time of sale and set forth in an
accompanying supplement to this Prospectus (a "Prospectus Supplement"). Pursuant
to the terms of the Registration Statement of which this Prospectus constitutes
a part, NationsBank may also offer and sell shares of its preferred stock (the
"Preferred Stock"), which may be represented by depositary shares (the
"Depositary Shares"), and shares of its common stock (the "Common Stock"). Any
such Preferred Stock, Depositary Shares or Common Stock will be offered and
issued pursuant to the terms of a separate Prospectus contained in such
Registration Statement. The aggregate amount of Debt Securities that may be
offered and sold pursuant hereto is subject to reduction as the result of the
sale of any Preferred Stock, Depositary Shares or Common Stock pursuant to such
separate Prospectus or at the Corporation's discretion.
The Senior Debt Securities will rank equally with all other unsubordinated
and unsecured indebtedness of the Corporation. The Subordinated Debt Securities
will be subordinate in right of payment to all existing and future Senior
Indebtedness (as defined herein) of the Corporation.
The Debt Securities may be denominated in U.S. dollars or in another
currency or currency unit (such as the European Currency Unit), and the
principal of (and premium, if any, on) or any interest on the Debt Securities
may be payable in U.S. dollars or such foreign currency or currency unit. The
specific terms of each series of Debt Securities offered pursuant to this
Prospectus, including the specific designation, aggregate principal amount,
currency or currency unit in which the principal and any premium or interest may
be payable, authorized denominations, maturity, any premium, any interest rate
(which may be fixed or variable), any interest payment dates, any optional or
mandatory redemption terms, any sinking fund provisions, any subordination
terms, any terms for conversion (in the event that such series is convertible at
the option of the holder or NationsBank into Preferred Stock, Depositary Shares,
Common Stock or other Debt Securities), the form of such series, any securities
exchange on which such Debt Securities may be listed, and any other terms of
such series of Debt Securities will be set forth in the Prospectus Supplement
relating to such series.
The Debt Securities may be sold (i) through underwriting syndicates
represented by managing underwriters, or by underwriters without a syndicate,
with such underwriters to be designated at the time of sale; (ii) through agents
designated from time to time; or (iii) directly by the Corporation. The names of
any underwriters or agents of NationsBank involved in the sale of the Debt
Securities, the public offering price or purchase price and any commissions or
discounts will be set forth in the applicable Prospectus Supplement or a pricing
supplement thereto. The net proceeds to the Corporation from such sale also will
be set forth in such Prospectus Supplement or pricing supplement.
This Prospectus may not be used to consummate sales of Debt Securities
unless accompanied by a Prospectus Supplement.
THESE SECURITIES ARE NOT SAVINGS ACCOUNTS OR BANK DEPOSITS, ARE NOT OBLIGATIONS
OF OR GUARANTEED BY ANY BANKING OR NONBANKING AFFILIATE OF NATIONSBANK, ARE
NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION
OR ANY OTHER GOVERNMENT AGENCY AND INVOLVE INVESTMENT
RISKS, INCLUDING POSSIBLE LOSS OF
PRINCIPAL.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION, THE COMMISSIONER OF INSURANCE OF THE STATE OF NORTH
CAROLINA (THE "COMMISSIONER") OR ANY STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION, THE COMMISSIONER OR ANY STATE
SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
THIS PROSPECTUS AND RELATED PROSPECTUS SUPPLEMENTS ARE TO BE USED BY NATIONSBANC
CAPITAL MARKETS, INC., A BROKER-DEALER AND A DIRECT WHOLLY-OWNED
SUBSIDIARY OF NATIONSBANK, IN CONNECTION WITH OFFERS AND SALES RELATED
TO SECONDARY MARKET TRANSACTIONS IN THE DEBT SECURITIES. NATIONSBANC
CAPITAL MARKETS, INC. OR ITS AFFILIATES MAY ACT AS PRINCIPAL OR
AGENT IN SUCH TRANSACTIONS. ANY SUCH SALES WILL BE MADE AT
NEGOTIATED PRICES RELATING TO PREVAILING MARKET PRICES AT
THE TIME OF SALE OR OTHERWISE.
NATIONSBANC CAPITAL MARKETS, INC.
The date of this Prospectus is , 1996.
(A redherring appears on the left-hand side of this page, rotated 90
degrees. Text is as follows.)
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE
SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION
STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO
SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY
STATE.
<PAGE>
[ALTERNATE PAGE -- DEBT]
to $905 million plus an additional amount equal to their net profits for 1996 up
to the date of any such dividend declaration.
In addition to the foregoing, the ability of NationsBank and the Banks to
pay dividends may be affected by the various minimum capital requirements and
the capital and non-capital standards established under FDICIA as described
above. Furthermore, the Comptroller may prohibit the payment of a dividend by a
national bank if it determines that such payment would constitute an unsafe or
unsound practice. The right of NationsBank, its shareholders and its creditors
to participate in any distribution of the assets or earnings of its subsidiaries
is further subject to the prior claims of creditors of the respective
subsidiaries.
SOURCE OF STRENGTH. According to Federal Reserve Board policy, bank holding
companies are expected to act as a source of financial strength to each
subsidiary bank and to commit resources to support each such subsidiary. This
support may be required at times when a bank holding company may not be able to
provide such support. In the event of a loss suffered or anticipated by the
FDIC -- either as a result of default of a banking or thrift subsidiary of
NationsBank or related to FDIC assistance provided to a subsidiary in danger of
default -- the other Banks may be assessed for the FDIC's loss, subject to
certain exceptions.
USE OF PROCEEDS
The net proceeds from the sale of the Debt Securities will be used for
general corporate purposes, including the Corporation's working capital needs,
the funding of investments in, or extensions of credit to, its banking and
nonbanking subsidiaries, possible acquisitions of other financial institutions
or their assets or liabilities, possible acquisitions of or investments in other
businesses of a type eligible for bank holding companies and possible reduction
of outstanding indebtedness or repurchase of outstanding equity securities of
the Corporation. Pending such use, the Corporation may temporarily invest the
net proceeds in investment grade securities. The Corporation may, from time to
time, engage in additional capital financings of a character and in amounts to
be determined by the Corporation in light of its needs at such time or times and
in light of prevailing market conditions. If the Corporation elects at the time
of issuance of Debt Securities to make different or more specific use of
proceeds other than that set forth herein, such use will be described in the
applicable Prospectus Supplement.
RATIOS OF EARNINGS TO FIXED CHARGES
The following are the Corporation's consolidated ratios of earnings to
fixed charges for the six months ended June 30, 1996 and for each of the years
in the five-year period ended December 31, 1995:
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED
JUNE 30, DECEMBER 31,
1996 1995 1994 1993 1992 1991
<S> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges:
Excluding interest on deposits......................................... 1.8 1.7 1.9 2.3 2.4 1.1
Including interest on deposits......................................... 1.4 1.4 1.5 1.5 1.4 1.0
</TABLE>
For purposes of computing the consolidated ratios, earnings represent net
income of the Corporation plus applicable income taxes and fixed charges, less
capitalized interest and the equity in undistributed earnings of unconsolidated
subsidiaries and associated companies. Fixed charges represent interest expense
(exclusive of interest on deposits in one case and inclusive of such interest in
the other), capitalized interest, amortization of debt discount and appropriate
issuance costs and one-third (the amount deemed to represent an appropriate
interest factor) of net rent expense under all lease commitments.
PLAN OF DISTRIBUTION
This Prospectus and related Prospectus Supplements are to be used by
NationsBanc Capital Markets, Inc. ("NCMI"), a broker-dealer and a direct
wholly-owned subsidiary of NationsBank, in connection with offers and sales of
the Debt Securities in secondary market transactions at negotiated prices
relating to prevailing prices at the time of sale or otherwise. NCMI may act as
principal or agent in such transactions. The participation of
ALT-6
<PAGE>
[ALTERNATE PAGE -- DEBT]
NCMI in the offer and sale of the Debt Securities complies with the requirements
of Section 2720 of the Conduct Rules of the National Association of Securities
Dealers, Inc. (the "NASD") regarding underwriting of securities of an affiliate.
NCMI will not execute a transaction in the Debt Securities in a discretionary
account without the prior written specific approval of NCMI's customer. NCMI has
no obligation to make a market in the Debt Securities and may discontinue its
market-making activities at any time without notice, at its sole discretion.
Furthermore, NCMI may be required to discontinue its market-making activities
during periods when the Corporation is involved in a distribution of certain of
its securities or when NCMI, by virtue of its affiliation with the Corporation,
is aware of material non-public information relating to the Corporation. In such
instance, NCMI would not be able to recommence its market-making activities
until such distribution has been completed or such information has become
publicly available. It is not possible to determine the impact, if any, that any
such discontinuance may have on the market for the Debt Securities. While other
broker-dealers may make a market in the Debt Securities from time to time, there
can be no assurance that any other broker-dealer will do so at any time when
NCMI discontinues its market-making activities.
DESCRIPTION OF DEBT SECURITIES
THE FOLLOWING DESCRIPTION OF THE DEBT SECURITIES SETS FORTH CERTAIN GENERAL
TERMS AND PROVISIONS OF THE DEBT SECURITIES TO WHICH ANY PROSPECTUS SUPPLEMENT
MAY RELATE. THE PARTICULAR TERMS OF THE DEBT SECURITIES OFFERED BY ANY
PROSPECTUS SUPPLEMENT AND THE EXTENT, IF ANY, TO WHICH SUCH GENERAL PROVISIONS
MAY APPLY TO THE DEBT SECURITIES SO OFFERED WILL BE DESCRIBED IN THE PROSPECTUS
SUPPLEMENT RELATING TO SUCH DEBT SECURITIES.
Any Senior Debt Securities offered hereby are to be issued under an
Indenture dated as of January 1, 1995 (such Indenture, as it may be amended from
time to time, the "Senior Indenture") between the Corporation and First Trust of
New York, National Association, as successor Trustee to BankAmerica National
Trust Company (the "Senior Trustee"). Any Subordinated Debt Securities offered
hereby are to be issued under an Indenture dated as of January 1, 1995 (such
Indenture, as it may be amended from time to time, the "Subordinated Indenture")
between the Corporation and The Bank of New York, Trustee (the "Subordinated
Trustee" and, together with the Senior Trustee, the "Trustees"). Each of the
Senior Indenture and the Subordinated Indenture (each, an "Indenture" and
together, the "Indentures") is incorporated by reference in the Registration
Statement of which this Prospectus forms a part.
The following summaries of certain provisions of the Indentures do not
purport to be complete and are subject to and qualified in their entirety by
reference to the provisions of the applicable Indentures. Whenever particular
sections or defined terms of the Indentures are referred to, it is intended that
such sections or defined items shall be incorporated herein by reference. Unless
otherwise indicated, capitalized terms shall have the meanings ascribed to them
in the Indentures.
GENERAL
The respective Indentures provide that there is no limitation on the amount
of debt securities that may be issued thereunder from time to time. The amount
of Debt Securities that may be offered and sold pursuant to this Prospectus,
however, is limited to the aggregate initial offering price of the securities
registered under the Registration Statement of which this Prospectus forms a
part, subject to reduction as the result of the sale by the Corporation of other
securities under the Registration Statement.
The Debt Securities will be direct, unsecured obligations of the
Corporation. The Senior Debt Securities of each series will rank equally with
all unsecured senior debt of the Corporation. The Subordinated Debt Securities
of each series will be subordinate and junior in right of payment to the prior
payment in full of all Senior Indebtedness (as hereinafter defined) of the
Corporation. See "DESCRIPTION OF DEBT SECURITIES -- Subordination."
The Debt Securities will be issued in fully registered form without
coupons. The Debt Securities may be denominated in U.S. dollars or in another
currency or currency unit. Unless otherwise set forth in the applicable
Prospectus Supplement, any Debt Securities that are denominated in U.S. dollars
will be issued in denominations of $1,000 or an integral multiple thereof. If
any of the Debt Securities are denominated in a foreign
ALT-7
<PAGE>
[ALTERNATE PAGE -- DEBT]
currency or currency unit, or if principal of (or premium, if any, on) or any
interest on any of the Debt Securities is payable in any foreign currency or
currency unit, the authorized denominations, as well as any investment
considerations, restrictions, tax consequences, specific terms and other
information with respect to such issue of Debt Securities and such foreign
currency or currency unit, will be set forth in the Prospectus Supplement
relating thereto.
The Debt Securities may be issued in one or more series with the same or
various maturities. Certain Debt Securities may be issued which provide for an
amount less than the principal amount thereof to be due and payable in the event
of an acceleration of the maturity thereof (each an "Original Issue Discount
Security"). Original Issue Discount Securities may bear no interest or may bear
interest at a rate which at the time of issuance is below market rates and will
be sold at a discount (which may be substantial) below their stated principal
amount. Certain Debt Securities may be deemed to be issued with original issue
discount for United States Federal income tax purposes. The Prospectus
Supplement with respect to any series of Debt Securities issued with such
original issue discount will contain a discussion of Federal income tax
considerations with respect thereto.
The particular terms of each series of Debt Securities to be offered and
sold will be described in the Prospectus Supplement relating to such Debt
Securities, including: (1) the designation of the particular series; (2) the
aggregate principal amount of such series that may be authenticated and
delivered under the applicable Indenture; (3) the person to whom any interest on
any Debt Security of the series shall be payable, if other than the person in
whose name the Debt Security (or one or more predecessor Debt Securities) is
registered at the close of business on the regular record date for such
interest; (4) the date or dates on which the principal of the Debt Securities of
such series is payable; (5) the rate or rates, and if applicable the method used
to determine the rate, at which the Debt Securities of such series shall bear
interest, if any, the date or dates from which such interest shall accrue, the
date or dates on which such interest shall be payable and the record date or
dates for the interest payable on any Debt Securities on any interest payment
date; (6) the place or places at which, subject to the provisions of the
applicable Indenture, the principal of (and premium, if any, on) and any
interest on Debt Securities of such series shall be payable, any Debt Securities
of the series may be surrendered for registration of transfer, and notices and
demands to or upon the Corporation in respect of the Debt Securities of the
series and the Indenture may be served; (7) the obligation, if any, of the
Corporation to redeem or purchase Debt Securities of such series, at the option
of the Corporation or at the option of a holder thereof, pursuant to any sinking
fund or other redemption provisions and the period or periods within which, the
price or prices at which and the terms and conditions upon which Debt Securities
of the series may be so redeemed or purchased, in whole or in part; (8) if other
than denominations of $1,000 and any integral multiple thereof, the
denominations in which any Debt Securities of such series shall be issuable; (9)
if other than the principal amount thereof, the portion of the principal amount
of Debt Securities of such series which shall be payable upon declaration of
acceleration of the maturity thereof; (10) the currency, currencies or currency
units in which payment of the principal of (and premium, if any, on) and any
interest on any Debt Securities of the series shall be payable if other than the
currency of the United States of America and the manner of determining the
equivalent thereof in the currency of the United States of America for purposes
of the applicable Indenture; (11) if the principal of (and premium, if any, on)
or any interest on the Debt Securities of the series is to be payable, at the
election of the Corporation or a holder thereof, in one or more currencies or
currency units, other than that or those in which the Debt Securities are stated
to be payable, the currency or currencies in which payment of the principal of
(and premium, if any, on) and any interest on Debt Securities of such series as
to which such election is made shall be payable, and the periods within which
and the terms and conditions upon which such election is to be made; (12) if the
amount of payments of principal of (and premium, if any, on) or any interest on
the Debt Securities of the series may be determined with reference to an index,
the manner in which such amounts shall be determined; (13) whether the Debt
Securities will be issued in book-entry only form; (14) the identification or
method of selection of any interest rate calculation agents, exchange rate
calculation agents or other agents with respect to Debt Securities of such
series; (15) if either or both of Section 14.02 (defeasance) or Section 14.03
(covenant defeasance) of the applicable Indenture do not apply to the Debt
Securities of the series; (16) any provisions relating to the extension of
maturity of, or the renewal of, Debt Securities of such series; and (17) any
other terms of the Debt Securities of such series (which terms shall not be
inconsistent with the provisions of the applicable Indenture).
ALT-8
<PAGE>
[ALTERNATE PAGE -- DEBT]
The ability of NationsBank to make payments of principal of (and premium,
if any, on) and any interest on the Debt Securities may be affected by the
ability of the Banks to pay dividends. The ability of the Banks, as well as of
the Corporation, to pay dividends in the future currently is, and could be
further, influenced by bank regulatory requirements and capital guidelines. See
"NATIONSBANK CORPORATION -- Supervision and Regulation."
Neither the Senior Indenture nor the Subordinated Indenture contains
provisions that would provide protection to holders of Debt Securities against a
decline in credit quality resulting from takeovers, recapitalizations, the
incurrence of additional indebtedness or similar restructurings by the
Corporation. If credit quality declines as a result of such an event, or
otherwise, the ratings of any Debt Securities then outstanding may be withdrawn
or downgraded.
CONVERSION
The Debt Securities of any series may be convertible, at the option of the
holder or the Corporation, into Preferred Stock, Depositary Shares, Common Stock
or other Debt Securities if the Prospectus Supplement relating to such series of
Debt Securities so provides. In such case, such Prospectus Supplement will set
forth (i) the period(s) during which such conversion may be elected; (ii) the
conversion price payable and the number of shares or amount of Preferred Stock,
Depositary Shares, Common Stock or other Debt Securities purchaseable upon
conversion, and adjustments thereto, if any, in certain events; (iii) the
procedures for electing such conversion; and (iv) all other terms for such
conversion (which terms shall not be inconsistent with the provisions of the
applicable Indenture).
EXCHANGE, REGISTRATION AND TRANSFER
At the option of the holder, subject to the terms of the applicable
Indenture, Debt Securities of any series (other than Debt Securities issued in
book-entry form) will be exchangeable for other Debt Securities of the same
series and of an equal aggregate principal amount and tenor of any authorized
denominations.
Debt Securities of a series may be presented for exchange as provided
above, and may be presented for registration of transfer (with the form of
transfer endorsed thereon duly executed), at the office of the Security
Registrar or at the office of any transfer agent of the Corporation designated
and maintained for such purpose with respect to such Debt Securities pursuant to
the terms of the applicable Indenture, as referred to in an applicable
Prospectus Supplement. Such transfer or exchange will be effected upon the
Security Registrar or transfer agent, as the case may be, being satisfied with
the documents of title and identity of the person making the request. No service
charge shall be made for any exchange or registration of transfer of Debt
Securities, but the Corporation may require payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in connection
therewith.
If a Prospectus Supplement refers to any transfer agents (in addition to
the Security Registrar) designated by the Corporation with respect to any series
of Debt Securities, the Corporation may at any time rescind the designation of
any such transfer agent or approve a change in the location through which any
such transfer agent acts, except that the Corporation will be required to
maintain a transfer agent in each place of payment for such series. The
Corporation may at any time designate additional transfer agents with respect to
any series of Debt Securities.
The Corporation shall not be required to (i) issue, exchange or register
the transfer of any Debt Security of any series to be redeemed for a period of
15 days next preceding any selection of such Debt Securities to be redeemed; or
(ii) exchange or register the transfer of any Debt Security so selected, called
or being called for redemption, except the unredeemed portion of any Debt
Security being redeemed in part.
For a discussion of restrictions on the exchange, registration and transfer
of Global Securities (hereinafter defined), see "REGISTRATION AND SETTLEMENT."
PAYMENT AND PAYING AGENTS
Unless otherwise indicated in an applicable Prospectus Supplement,
principal of (and premium, if any, on) and any interest on Debt Securities will
be payable, subject to any applicable laws and regulations, at the offices of
such paying agents as the Corporation may designate from time to time pursuant
to the applicable
ALT-9
<PAGE>
[ALTERNATE PAGE -- DEBT]
Indenture, except that, at the option of the Corporation, payment of any
interest may be made by check mailed to the address of the person entitled
thereto as such address shall appear in the Security Register. Unless otherwise
indicated in an applicable Prospectus Supplement, payment of interest on a Debt
Security on any interest payment date generally will be made to the person in
whose name such Debt Security is registered at the close of business on the
regular record date for such interest payment date. For a discussion of payment
of principal and any premium or interest with respect to Global Securities, see
"REGISTRATION AND SETTLEMENT."
The Corporation initially has designated the principal corporate trust
offices of the Senior Trustee and the Subordinated Trustee in the City of New
York as the places where the Senior Debt Securities and Subordinated Debt
Securities, respectively, may be presented for payment. The Corporation may at
any time designate additional paying agents or rescind the designation of any
paying agent or approve a change in the office through which any paying agent
acts. Any other paying agents designated by the Corporation for the Debt
Securities of each series will be named in an applicable Prospectus Supplement.
SUBORDINATION
The Subordinated Debt Securities are subordinate and subject, to the extent
and in the manner set forth in the Subordinated Indenture, in right of payment
to the prior payment in full of all Senior Indebtedness of the Corporation.
"Senior Indebtedness" is defined by the Subordinated Indenture as any
indebtedness for money borrowed (including all indebtedness of the Corporation
for borrowed and purchased money of the Corporation, all obligations of the
Corporation arising from off-balance sheet guarantees by the Corporation and
direct credit substitutes, and obligations of the Corporation associated with
derivative products such as interest and foreign exchange rate contracts and
commodity contracts) that is outstanding on the date of execution of the
Subordinated Indenture, or is thereafter created, incurred or assumed, for the
payment of which the Corporation is at the time of determination responsible or
liable as obligor, guarantor or otherwise, and all deferrals, renewals,
extensions and refundings of any such indebtedness or obligations, other than
the Subordinated Debt Securities or any other indebtedness as to which, in the
instrument creating or evidencing the same or pursuant to which the same is
outstanding, it is provided that such indebtedness is subordinate in right of
payment to any other indebtedness of the Corporation. The Prospectus Supplement
relating to each series of Subordinated Debt Securities will set forth the
aggregate amount of then outstanding Senior Indebtedness of the Corporation and
any limitation on the issuance of additional Senior Indebtedness.
No payment on account of principal of (and premium, if any, on) or any
interest on the Subordinated Debt Securities shall be made, and no Subordinated
Debt Securities shall be purchased, either directly or indirectly, by the
Corporation or any of its subsidiaries, if any default or event of default with
respect to any Senior Indebtedness shall have occurred and be continuing and the
Corporation and the Subordinated Trustee shall have received written notice
thereof from the holders of at least 10% in principal amount of any kind or
category of any Senior Indebtedness (or the representative or representatives of
such holders) or the Subordinated Trustee shall have received written notice
thereof from the Corporation.
In the event that any Subordinated Debt Security is declared due and
payable before the date specified therein as the fixed date on which the
principal thereof is due and payable pursuant to the Subordinated Indenture, or
upon any payment or distribution of assets of the Corporation of any kind or
character to creditors upon any dissolution or winding up or total or partial
liquidation or reorganization of the Corporation, all principal of (and premium,
if any, on) and any interest due or to become due upon all Senior Indebtedness
shall first be paid in full before the holders of the Subordinated Debt
Securities (the "Subordinated Debt Holders"), or the Subordinated Trustee, shall
be entitled to retain any assets (other than shares of stock of the Corporation
as reorganized or readjusted or securities of the Corporation or any other
corporation provided for by a plan of reorganization or readjustment, the
payment of which is subordinated, at least to the same extent as the
Subordinated Debt Securities, to the payment of all Senior Indebtedness which
may at the time be outstanding, provided that the rights of the holders of the
Senior Indebtedness are not altered by such reorganization or readjustment), so
paid or distributed in respect of the Subordinated Debt Securities (for
principal or interest, if any). Upon such dissolution or winding up or
liquidation or reorganization, any payment or distribution of assets of the
Corporation of any kind or character, whether in cash, property or securities
(other than shares of stock of the Corporation as reorganized or readjusted or
securities of the Corporation or any other corporation provided for by a plan of
reorganization or readjustment, the payment of which is subordinated at least to
the same extent as the Subordinated Debt Securities, to the payment of all
Senior Indebtedness which
ALT-10
<PAGE>
[ALTERNATE PAGE -- DEBT]
may at the time be outstanding, provided that the rights of the holders of the
Senior Indebtedness are not altered by such reorganization or readjustment), to
which the Subordinated Debt Holders or the Subordinated Trustee would be
entitled, except for the subordination provisions of the Subordinated Indenture,
shall be paid by the Corporation or by any receiver, trustee in bankruptcy,
liquidating trustee, agent or other person making such payment or distribution,
or by the Subordinated Debt Holders or the Subordinated Trustee if received by
them or it, directly to the holders of the Senior Indebtedness (pro rata to each
such holder on the basis of the respective amounts of Senior Indebtedness held
by such holder) or their representatives, to the extent necessary to pay all
Senior Indebtedness in full, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Indebtedness, before any payment or
distribution is made to the Subordinated Debt Holders or to the Subordinated
Trustee.
Subject to the payment in full of all Senior Indebtedness, the Subordinated
Debt Holders shall be subrogated (equally and ratably with the holders of all
indebtedness of the Corporation which, by its express terms, ranks on a parity
with the Subordinated Debt Securities and is entitled to like rights of
subrogation) to the rights of the holders of Senior Indebtedness to receive
payments or distributions of assets of the Corporation applicable to the Senior
Indebtedness until the Subordinated Debt Securities shall be paid in full.
SALE OR ISSUANCE OF CAPITAL STOCK OF BANKS
The Senior Indenture prohibits the issuance, sale or other disposition of
capital stock, or securities convertible into or options, warrants or rights to
acquire capital stock, of any Principal Subsidiary Bank (as defined below) or of
any subsidiary which owns shares of capital stock, or securities convertible
into or options, warrants or rights to acquire capital stock, of any Principal
Subsidiary Bank, with the following exceptions: (a) sales of directors'
qualifying shares; (b) sales or other dispositions for fair market value, if,
after giving effect to such disposition and to conversion of any shares or
securities convertible into capital stock of a Principal Subsidiary Bank, the
Corporation would own directly or indirectly not less than 80% of each class of
the capital stock of such Principal Subsidiary Bank (or any successor
corporation thereto); (c) sales or other dispositions made in compliance with an
order of a court or regulatory authority of competent jurisdiction; (d) any sale
by a Principal Subsidiary Bank (or any successor corporation thereto) of
additional shares of its capital stock to its shareholders at any price, so long
as (i) prior to such sale the Corporation owns, directly or indirectly, shares
of the same class and (ii) immediately after such sale, the Corporation owns,
directly or indirectly, at least as great a percentage of each class of capital
stock of such Principal Subsidiary Bank as it owned prior to such sale of
additional shares; (e) any sale by a Principal Subsidiary Bank (or any successor
corporation thereto) of additional securities convertible into shares of its
capital stock to its shareholders at any price, so long as (i) prior to such
sale the Corporation owns, directly or indirectly, securities of the same class
and (ii) immediately after such sale the Corporation owns, directly or
indirectly, at least as great a percentage of each class of such securities
convertible into shares of capital stock of such Principal Subsidiary Bank as it
owned prior to such sale of additional securities; (f) any sale by a Principal
Subsidiary Bank (or any successor corporation thereto) of additional options,
warrants or rights to subscribe for or purchase shares of its capital stock to
its shareholders at any price, so long as (i) prior to such sale the Corporation
owns, directly or indirectly, options, warrants or rights, as the case may be,
of the same class and (ii) immediately after such sale, the Corporation owns,
directly or indirectly, at least as great a percentage of each class of such
options, warrants or rights, as the case may be, to subscribe for or purchase
shares of capital stock of such Principal Subsidiary Bank as it owned prior to
such sale of additional options, warrants or rights; or (g) any issuance of
shares of capital stock, or securities convertible into or options, warrants or
rights to subscribe for or purchase shares of capital stock, of a Principal
Subsidiary Bank or any subsidiary which owns shares of capital stock, or
securities convertible into or options, warrants or rights to acquire capital
stock, of any Principal Subsidiary Bank, to the Corporation or a wholly owned
subsidiary of the Corporation.
A Principal Subsidiary Bank is defined in the Senior Indenture as any Bank
(other than NationsBank of Delaware, National Association) with total assets
equal to more than 10% of the Corporation's total consolidated assets.
WAIVER OF COVENANTS
Under the terms of either Indenture, compliance with certain covenants or
conditions of such Indenture may be waived by the holders of a majority in
principal amount of the Debt Securities of all series to be affected
ALT-11
<PAGE>
[ALTERNATE PAGE -- DEBT]
thereby and at the time outstanding under that Indenture (including, in the case
of holders of Senior Debt Securities, the covenant described above).
MODIFICATION OF THE INDENTURES
Each Indenture contains provisions permitting the Corporation and the
applicable Trustee to modify such Indenture or the rights of the holders of Debt
Securities thereunder, with the consent of the holders of not less than 66 2/3%
in aggregate principal amount of the Debt Securities of all series at the time
outstanding under that Indenture and to be affected thereby (voting as one
class), except that no such modification shall (a) extend the fixed maturity of,
reduce the principal amount or redemption premium, if any, of, or reduce the
rate of or extend the time of payment of interest on, any Debt Security without
the consent of the holder of each security so affected, or (b) reduce the
aforesaid percentage of Debt Securities, the consent of holders of which is
required for any such modification, without the consent of the holders of all
Debt Securities then outstanding under that Indenture. Each Indenture also
provides that the Corporation and the respective Trustee may, from time to time,
execute supplemental indentures in certain limited circumstances without the
consent of any holders of outstanding Debt Securities.
Each Indenture provides that in determining whether the holders of the
requisite principal amount of the Debt Securities outstanding have given any
request, demand, authorization, direction, notice, consent or waiver thereunder,
(i) the principal amount of an Original Issue Discount Security that shall be
deemed to be outstanding shall be the amount of the principal thereof that would
be due and payable at such time upon an event of default, and (ii) the principal
amount of a Debt Security denominated in a foreign currency or currency unit
shall be the U.S. dollar equivalent on the date of original issuance of such
Debt Security.
MEETINGS AND ACTION BY SECURITYHOLDERS
Each Indenture contains provisions for convening meetings of the holders of
Debt Securities for certain purposes. A meeting may be called at any time by the
Trustee in its discretion and shall be called by the Trustee upon request by the
Corporation or the holders of at least 10% in aggregate principal amount of the
Debt Securities outstanding of such series, in any case upon notice given in
accordance with "Notices" below. Any resolution passed or decision taken at any
meeting of holders of Debt Securities of any series duly held in accordance with
the applicable Indenture, or such other action taken in accordance with the
terms of the applicable Indenture, will be binding on all holders of Debt
Securities of that series.
DEFAULTS AND RIGHTS OF ACCELERATION
An Event of Default is defined in the Subordinated Indenture generally as
bankruptcy of the Corporation under Federal bankruptcy laws. An Event of Default
is defined in the Senior Indenture generally as (i) the Corporation's failure to
pay principal (or premium, if any) when due on any securities of a series; (ii)
the Corporation's failure to pay interest on any securities of a series, within
30 days after the same becomes due; (iii) the Corporation's breach of any of its
other covenants contained in the Senior Debt Securities or the Senior Indenture,
which breach is not cured within 90 days after written notice to the Corporation
by the Senior Trustee, or to the Corporation and the Senior Trustee by the
holders of at least 25% in principal amount of all Senior Debt Securities then
outstanding under the Senior Indenture and affected thereby; and (iv) certain
events involving the bankruptcy, insolvency or liquidation of the Corporation.
Each Indenture provides that if an Event of Default under the respective
Indenture occurs and is continuing, either the respective Trustee or the holders
of 25% in principal amount (or, if any such Debt Securities are Original Issue
Discount Debt Securities, such lesser amounts as may be described in an
applicable Prospectus Supplement) of the Debt Securities then outstanding under
that Indenture (or, with respect to an Event of Default under the Senior
Indenture due to a default in the payment of principal (or premium, if any) or
interest or performance of any other covenant, the outstanding Debt Securities
of all series affected by such default) may declare the principal amount of all
of such Debt Securities to be due and payable immediately. Payment of principal
of the Subordinated Debt Securities may not be accelerated in the case of a
default in the payment of principal (or premium, if any) or interest or the
performance of any other covenant of the Corporation. Upon certain conditions a
declaration of an Event of Default may be annulled and past defaults may be
waived by the holders of a majority in principal amount of the Debt Securities
then outstanding (or of such series affected, as the case may be).
ALT-12
<PAGE>
[ALTERNATE PAGE -- DEBT]
COLLECTION OF INDEBTEDNESS, ETC.
Each Indenture also provides that in the event of a failure by the
Corporation to make payment of principal of (and premium, if any, on) or any
interest on the Debt Securities (and, in the case of payment of interest, such
failure to pay shall have continued for 30 days) and upon the demand of the
respective Trustee, the Corporation will pay to such Trustee, for the benefit of
the holders of the Debt Securities, the amount then due and payable on the Debt
Securities for principal and interest, with interest on the overdue principal
and, to the extent payment of interest shall be legally enforceable, upon
overdue installments of interest at the rate borne by the Debt Securities. Each
Indenture further provides that if the Corporation fails to pay such amount
forthwith upon such demand, the respective Trustee may, among other things,
institute a judicial proceeding for the collection thereof. However, each
Indenture provides that notwithstanding any other provision of the Indenture,
the holder of any Debt Security shall have the right to institute suit for the
enforcement of any payment of principal of (and premium, if any, on) and any
interest on such Debt Security on the respective stated maturities expressed in
such Debt Security and that such right shall not be impaired without the consent
of such holder.
The holders of a majority in principal amount of the Debt Securities then
outstanding under an Indenture shall have the right to direct the time, method
and place of conducting any proceeding for any remedy available to the Trustee
under that Indenture, provided that the holders shall have offered to the
Trustee reasonable indemnity against expenses and liabilities. Each Indenture
requires the annual filing by the Corporation with the respective Trustee of a
certificate as to the absence of default and as to compliance with the terms of
that Indenture.
NOTICES
Except as otherwise provided in the applicable Indenture, notices to
holders of Debt Securities will be given by first-class mail to the addresses of
such holders as they appear in the Security Register.
CONCERNING THE TRUSTEES
The Corporation and the Banks have from time to time maintained deposit
accounts and conducted other banking transactions with The Bank of New York and
First Trust of New York, National Association, and their affiliated entities in
the ordinary course of business. Each of the Trustees also serves as trustee for
certain series of the Corporation's outstanding indebtedness under other
indentures.
REGISTRATION AND SETTLEMENT
DTC
If so specified in an applicable Prospectus Supplement, all or any portion
of the Debt Securities of a series may be issued in book-entry form represented
by one or more global Debt Securities in registered form (each, a "Global
Security"). Unless otherwise specified in such Prospectus Supplement, each such
Global Security will be held through The Depository Trust Company ("DTC"), as
depositary, and will be registered in the name of Cede & Co., as nominee of DTC.
Under the book-entry system of DTC, purchases of Debt Securities of a
series represented by a Global Security must be made by or through persons that
have accounts with DTC ("DTC Participants") or persons that may hold interests
through DTC Participants ("Indirect Participants"). Upon the issuance and
deposit of a Global Security, DTC will credit, on its book-entry registration
and transfer system, the respective principal amounts of the individual Debt
Securities represented by such Global Security to the accounts of DTC
Participants. The accounts to be credited will be designated by the underwriters
or agents of such Debt Securities (or by the Corporation, if such Debt
Securities are offered and sold directly by the Corporation). The ownership of
beneficial interests in such Global Security will be shown on, and the transfer
of that ownership will be effected only through, records maintained by DTC (with
respect to interests of DTC Participants) and the records of DTC Participants
(with respect to interests of Indirect Participants) and Indirect Participants.
The laws of some jurisdictions require that certain purchasers of securities
take physical delivery of such securities in certificated form. Such limits and
laws may impair the ability to own, transfer or pledge beneficial interests in a
Global Security.
ALT-13
<PAGE>
[ALTERNATE PAGE -- DEBT]
So long as DTC or its nominee is the registered holder of a Global
Security, DTC or its nominee, as applicable, will be considered the sole owner
or holder of the Debt Securities represented by such Global Security for all
purposes under the applicable Indenture. Except as provided below, owners of
beneficial interests in a Global Security will not be entitled to have Debt
Securities registered in their names, will not receive or be entitled to receive
physical delivery of such Debt Securities in certificated form and will not be
considered the owners or holders thereof under the applicable Indenture.
Accordingly, in order to exercise any rights of a holder of the Debt Securities
under the applicable Indenture, each person owning a beneficial interest in the
Global Security representing such Debt Securities must rely on the procedures of
DTC or, if such person is not a DTC Participant, on the procedures of the DTC
Participant and, if applicable, the Indirect Participant, through which such
person owns its interest.
So long as DTC or its nominee is the registered holder of a Global
Security, Debt Securities of the series represented by such Global Security will
trade in DTC's Same Day Fund Settlement System, and secondary market trading
activity in such Debt Securities will therefore be required by DTC to settle in
immediately available funds. No assurance can be given as to the effect, if any,
of settlement in immediately available funds on trading activity in such Debt
Securities.
Except as otherwise provided herein, DTC or its nominee, as applicable, as
the registered holder of a Global Security shall be the only person entitled to
receive payments from the Corporation with respect to Debt Securities of the
series represented by such Global Security. Accordingly, payments of principal
of (and premium, if any, on) and any interest on individual Debt Securities of
the series represented by such a Global Security will be made by the Corporation
only to DTC or its nominee, as applicable. DTC has advised the Corporation that
it is DTC's practice to credit DTC Participants' accounts on the payable date in
accordance with their respective holdings with respect to a Global Security as
shown on DTC's records, unless DTC has reason to believe that it will not
receive payment on such date. Payments by DTC Participants to beneficial owners
are governed by standing instructions and customary practices, as is the case
with securities held in "street name." Such instructions will be the
responsibility of such DTC Participant and not of DTC, the Corporation or any
underwriter or agent for the Debt Securities of the series represented by such
Global Security, subject to any statutory or regulatory requirements as may be
in effect from time to time. The Corporation will in every case be discharged by
payment to, or to the order of, DTC or its nominee, as applicable, as the
registered holder of such Global Security, of the amount so paid. Each of the
persons shown in the records of DTC or its nominee as an owner of a beneficial
interest in such Global Security must look solely to DTC or its nominee, as the
case may be, for its share of any such payment so made by the Corporation.
Neither the Corporation, the Trustee for the Debt Securities of the series
represented by such Global Security, any paying agent or authenticating agent
for such Debt Securities nor the Security Registrar or transfer agent for such
Debt Securities will have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial interests in the
Global Security representing such Debt Securities or for maintaining,
supervising or reviewing any records relating to such beneficial interests.
DTC has advised the Corporation as follows: DTC is a limited-purpose trust
company organized under New York law, a "banking organization" within the
meaning of New York law, a member of the Federal Reserve System, a "clearing
corporation" within the meaning of the Uniform Commercial Code as in effect in
the state of New York and a "clearing agency" registered pursuant to the
provisions of Section 17A of the 1934 Act. DTC was created to hold securities
deposited by DTC Participants and to facilitate the clearance and settlement of
securities transactions among DTC Participants in such securities through
electronic computerized book-entry changes in accounts of the DTC Participants,
thereby eliminating the need for physical movement of securities certificates.
DTC's direct DTC Participants include securities brokers and dealers, banks
(including certain subsidiaries of the Corporation), trust companies, clearing
corporations and certain other organizations, some of whom (and/or their
representatives) have ownership interests in DTC. DTC is owned by a number of
its DTC Participants and by the New York Stock Exchange, Inc., the American
Stock Exchange, Inc. and the NASD. Indirect access to DTC's book-entry system is
also available to Indirect Participants, such as banks, brokers, dealers and
trust companies that clear through or maintain a custodial relationship with a
DTC Participant, either directly or indirectly. The rules applicable to DTC and
DTC Participants are on file with the Commission.
To facilitate subsequent transfers, all securities deposited with DTC are
registered in the name of DTC's partnership nominee, Cede & Co. The deposit of
securities with DTC and their registration in the name of Cede
ALT-14
<PAGE>
[ALTERNATE PAGE -- DEBT]
& Co. effect no change in beneficial ownership. DTC has no knowledge of the
actual beneficial owners of securities deposited with it; DTC's records reflect
only the identity of the DTC Participants to whose accounts such securities are
credited, which may or may not be the beneficial owners. The DTC Participants
will remain responsible for keeping account of their holdings on behalf of their
customers. Conveyance of notices and other communications by DTC to DTC
Participants, by DTC Participants to Indirect Participants, and by DTC
Participants and Indirect Participants to beneficial owners, will be governed by
arrangements among them, subject to any statutory or regulatory requirements as
may be in effect from time to time. Neither DTC nor Cede & Co. will consent or
vote with respect to securities held by DTC. Under its usual procedures, DTC
mails an omnibus proxy to an issuer as soon as possible after the record date.
The omnibus proxy assigns Cede & Co.'s consenting or voting rights to those DTC
Participants to whose accounts the securities are credited on the record date
(identified in a listing attached to the omnibus proxy).
DTC can act only on behalf of DTC Participants, who in turn act on behalf
of Indirect Participants. Owners of beneficial interests in a Global Security
that are not DTC Participants or Indirect Participants but desire to purchase,
sell or otherwise transfer ownership of such interests may do so only through
DTC Participants and Indirect Participants. In addition, the ability of owners
of beneficial interests in a Global Security to pledge such interests to persons
or entities that do not participate in the DTC system may be limited due to the
lack of certificates for the Debt Securities of the series represented by such
Global Security.
Although DTC has agreed to the foregoing procedures in order to facilitate
transfers of beneficial interests in Global Securities among DTC Participants,
it is under no obligation to perform or continue to perform such procedures, and
such procedures may be discontinued at any time.
If DTC is at any time unwilling, unable or ineligible to continue as a
depositary with respect to Debt Securities of a particular series and a
successor depositary is not appointed by the Corporation within 90 days, the
Corporation will issue Debt Securities of the series in certificated form in
exchange for beneficial interests in the Global Security representing such Debt
Securities. In addition, the Corporation may at any time determine not to have
Debt Securities of a series represented by Global Securities and, in such event,
will issue Debt Securities of the series in certificated form in exchange for
beneficial interests in the Global Security representing such Debt Securities.
In any such instance, an owner of a beneficial interest in the Global Security
will be entitled to physical delivery in certificated form of a note or notes
representing such Debt Securities equal in principal amount to such beneficial
interest and to have such note or notes registered in its name. Unless otherwise
specified in the applicable Prospectus Supplement, any notes so issued in
certificated form will be issued in denominations of $1,000 or any integral
multiple in excess thereof and will be issued in registered form only, without
coupons.
CEDEL BANK AND EUROCLEAR
If so specified in the applicable Prospectus Supplement, Debt Securities of
a series to be issued in book-entry form and to be sold or traded in Europe may
be represented by one or more Global Securities held through Cedel Bank, societe
anonyme ("Cedel Bank") or Morgan Guaranty Trust Company of New York, Brussels
office, as operator of the Euroclear System (the "Euroclear Operator" or
"Euroclear"). Cedel Bank and Euroclear will hold omnibus positions on behalf of
Cedel Bank Participants and Euroclear Participants (each as hereinafter
defined), respectively, on the books of their respective depositaries (each, a
"Depositary"), which in turn will hold such positions on the books of DTC.
Transfers between Cedel Bank Participants and Euroclear Participants will
occur in the ordinary way in accordance with their applicable rules and
operating procedures. Cross-market transfers between persons holding directly or
indirectly through DTC in the United States, on the one hand, and directly or
indirectly through Cedel Bank Participants or Euroclear Participants, on the
other, will be effected by DTC in accordance with DTC rules on behalf of the
relevant European international clearing system by its Depositary. Such cross-
market transactions, however, will require delivery of instructions to the
relevant European international clearing system by the counterparty in such
system in accordance with its rules and procedures and within its established
deadlines (European time). The relevant European international clearing system
will, if the transaction meets its settlement requirements, deliver instructions
to its Depositary to take action to effect final settlement on its behalf by
delivering or receiving securities in DTC, and making or receiving in accordance
ALT-15
<PAGE>
[ALTERNATE PAGE -- DEBT]
with normal procedures for same-day funds settlement applicable to DTC. Cedel
Bank Participants and Euroclear Participants may not deliver instructions
directly to the Depositaries.
Because of time-zone differences, credits for securities in Cedel Bank or
Euroclear as a result of a transaction with a DTC Participant will be made
during the subsequent securities settlement processing, and will be dated the
business day following the DTC settlement date, and such credits or any
transactions in such securities settled during such processing will be reported
to the relevant Cedel Bank Participant or Euroclear Participant on such business
day. Cash received in Cedel Bank or Euroclear as a result of sales of securities
by or through a Cedel Bank Participant or a Euroclear Participant to a DTC
Participant will be received with value on the DTC settlement date but will be
available in the relevant Cedel Bank or Euroclear cash account only as of the
business day following settlement in DTC.
Cedel Bank is incorporated under the laws of Luxembourg as a professional
depository. Cedel Bank holds securities for its participating organizations
("Cedel Participants") and facilitates the clearance and settlement of
securities transactions between Cedel Participants through electronic book-entry
changes in accounts of Cedel Participants, thereby eliminating the need for
physical movement of certificates. Transactions may be settled by Cedel Bank in
any of 28 currencies, including United States dollars. Cedel Bank provides to
its Cedel Participants, among other things, services for safekeeping,
administration, clearance and settlement of internationally traded securities
and securities lending and borrowing. Cedel Bank interfaces with domestic
markets in several countries. As a professional depository, Cedel Bank is
subject to regulation by the Luxembourg Monetary Institute. Cedel Participants
consist of recognized financial institutions around the world, including
underwriters, securities brokers and dealers, banks, trust companies, clearing
corporations and certain other organizations and may include the underwriters or
agents with respect to a particular series of Debt Securities. Indirect access
to Cedel Bank is also available to others, such as banks, brokers, dealers and
trust companies that clear through or maintain a custodial relationship with a
Cedel Participant, either directly or indirectly.
The Euroclear System (the "Euroclear System") was created in 1968 to hold
securities for participants of the Euroclear System ("Euroclear Participants")
and to clear and settle transactions between Euroclear Participants through
simultaneous electronic book-entry delivery against payment, thereby eliminating
the need for physical movement of certificates and any risk from lack of
simultaneous transfers of securities and cash. Transactions now may be settled
by Euroclear in any of 32 currencies, including United States dollars. The
Euroclear System includes various other services, including securities lending
and borrowing and interfaces with domestic markets in several countries
generally similar to the arrangements for cross-market transfers with DTC
described above. The Euroclear System is operated by the Euroclear Operator,
under contract with Euroclear Clearance System, S.C., a Belgian cooperative
corporation (the "Cooperative"). All operations are conducted by the Euroclear
Operator, and all Euroclear securities clearance accounts and Euroclear cash
accounts are accounts with the Euroclear Operator, not the Cooperative. The
Cooperative establishes policy for the Euroclear System on behalf of Euroclear
Participants. Euroclear Participants include banks (including central banks),
securities brokers and dealers and other professional financial intermediaries
and may include the underwriters or agents with respect to a particular series
of Debt Securities. Indirect access to the Euroclear System is also available to
other firms that clear through or maintain a custodial relationship with a
Euroclear Participant, either directly or indirectly.
The Euroclear Operator is the Brussels branch of a New York banking
corporation that is a member bank of the Federal Reserve System. As such, it is
regulated and examined by the Federal Reserve Board and the New York State
Banking Department, as well as the Belgian Banking Commission.
Securities clearance accounts and cash accounts with the Euroclear Operator
are governed by the Terms and Conditions Governing Use of Euroclear and the
related Operating Procedures of the Euroclear System and applicable Belgian law
(collectively, the "Terms and Conditions"). The Terms and Conditions govern
transfers of securities and cash within the Euroclear System, withdrawal of
securities and cash from the Euroclear System and receipts of payments with
respect to securities in the Euroclear System. All securities in the Euroclear
System are held on a fungible basis without attribution of specific certificates
to specific securities clearance accounts. The Euroclear Operator acts under the
Terms and Conditions only on behalf of Euroclear Participants and has no record
of or relations with persons holding through Euroclear Participants.
Distributions with respect to Debt Securities of a series held through
Cedel Bank or Euroclear will be credited to the cash accounts of Cedel
Participants or Euroclear Participants in accordance with the relevant
ALT-16
<PAGE>
[ALTERNATE PAGE -- DEBT]
system's rules and procedures, to the extent received by its respective
Depositary. Such distributions will be subject to tax reporting in accordance
with relevant United States tax laws and regulations. The applicable Prospectus
Supplement with respect to a series of Debt Securities held through Cedel Bank
or Euroclear will set forth certain income tax consequences to foreign
investors. Cedel Bank or the Euroclear Operator, as the case may be, will take
any other action permitted to be taken by a holder of Debt Securities under the
applicable Indenture on behalf of a Cedel Participant or a Euroclear Participant
only in accordance with its relevant rules and procedures and subject to its
respective Depositary's ability to effect such actions on its behalf through
DTC.
Although Cedel Bank and Euroclear have agreed to the foregoing procedures
in order to facilitate transfers of applicable Debt Securities among
participants of DTC, Cedel Bank and Euroclear, they are under no obligation to
perform or continue to perform such procedures, and such procedures may be
discontinued at any time.
LEGAL OPINIONS
The legality of the Debt Securities will be passed upon for the Corporation
by Smith Helms Mulliss & Moore, L.L.P., Charlotte, North Carolina, and for the
underwriters or agents by Stroock & Stroock & Lavan, New York, New York. As of
the date of this Prospectus, certain members of Smith Helms Mulliss & Moore,
L.L.P. beneficially own approximately 50,000 shares of the Corporation's Common
Stock.
EXPERTS
The consolidated financial statements of the Corporation incorporated in
this Prospectus by reference to the Corporation's Annual Report on Form 10-K for
the year ended December 31, 1995, have been so incorporated in reliance on the
report of Price Waterhouse LLP, independent accountants, given on the authority
of said firm as experts in auditing and accounting.
ALT-17
<PAGE>
[ALTERNATE PAGE -- DEBT]
NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS IN CONNECTION WITH THE OFFERING MADE HEREBY AND, IF GIVEN OR MADE,
SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE CORPORATION OR NATIONSBANC CAPITAL MARKETS, INC. NEITHER THE
DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE AN IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF THE CORPORATION SINCE THE DATE HEREOF. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER OR SOLICITATION BY ANYONE IN ANY STATE IN WHICH SUCH OFFER
OR SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR
SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UNLAWFUL TO
MAKE SUCH OFFER OR SOLICITATION. THIS PROSPECTUS AND RELATED PROSPECTUS
SUPPLEMENTS ARE TO BE USED BY NATIONSBANC CAPITAL MARKETS, INC., A BROKER-DEALER
AND A DIRECT WHOLLY-OWNED SUBSIDIARY OF THE CORPORATION, IN CONNECTION WITH
OFFERS AND SALES RELATED TO SECONDARY MARKET TRANSACTIONS.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PROSPECTUS PAGE
<S> <C>
Incorporation of Certain Documents by
Reference.................................... 2
Available Information.......................... 2
NationsBank Corporation........................ 3
Use of Proceeds................................ 6
Ratios of Earnings to Fixed Charges............ 6
Plan of Distribution........................... 6
Description of Debt Securities................. 7
Registration and Settlement.................... 13
Legal Opinions................................. 17
Experts........................................ 17
</TABLE>
$3,000,000,000
NATIONSBANK(Register Mark)
DEBT SECURITIES
PROSPECTUS
NATIONSBANC CAPITAL MARKETS, INC.
, 1996
<PAGE>
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED OCTOBER 9, 1996
[EQUITY]
PROSPECTUS
NATIONSBANK(Register mark)
Preferred Stock
Depositary Shares
Common Stock
NationsBank Corporation ("NationsBank" or the "Corporation") may offer from
time to time shares of its preferred stock (the "Preferred Stock"), which may be
represented by depositary shares (the "Depositary Shares"), and shares of its
common stock (the "Common Stock" and, together with the Preferred Stock and the
Depositary Shares, the "Securities"). NationsBank may sell up to $3,000,000,000
in aggregate initial offering price of the Securities, which may be offered,
separately or together, in one or more series, in amounts, at prices and on
terms to be determined at the time of sale and set forth in one or more
supplements to this Prospectus (a "Prospectus Supplement"). Pursuant to the
terms of the Registration Statement of which this Prospectus constitutes a part,
NationsBank may also offer and sell its unsecured debt securities, which may be
either senior or subordinated (the "Debt Securities"). Any such Debt Securities
will be offered and issued pursuant to the terms of a separate Prospectus
contained in such Registration Statement. The aggregate amount of Securities
that may be offered and sold pursuant hereto is subject to reduction as the
result of the sale of any Debt Securities pursuant to such separate Prospectus
or at the Corporation's discretion.
The specific terms of any Securities offered pursuant to this Prospectus
will be set forth in a Prospectus Supplement. Such terms will include: (a) in
the case of any series of Preferred Stock, the specific designation, the
aggregate number of shares offered, the dividend rate or method of calculation,
the dividend period and dividend payment dates, whether such dividends will be
cumulative or noncumulative, the liquidation preference, voting rights, if any,
any terms for redemption at the option of the holder or NationsBank, any
applicable conversion provisions in the event that such series is convertible at
the option of the holder or NationsBank into shares of Common Stock, and any
other terms of the offering or the series, and (b) in the case of Common Stock,
the aggregate number of shares offered.
The Securities may be sold (i) through underwriting syndicates represented
by managing underwriters, or by underwriters without a syndicate, with such
underwriters to be designated at the time of sale; (ii) through agents
designated from time to time; or (iii) directly by the Corporation. The names of
any underwriters or agents of NationsBank involved in the sale of the
Securities, and any applicable commissions or discounts, will be set forth in
the applicable Prospectus Supplement, in addition to any other terms of the
offering of such Securities. The net proceeds to the Corporation from such sale
also will be set forth in such Prospectus Supplement.
This Prospectus may not be used to consummate sales of Securities unless
accompanied by a Prospectus Supplement.
THESE SECURITIES ARE NOT SAVINGS ACCOUNTS OR BANK DEPOSITS, ARE NOT
OBLIGATIONS OF OR GUARANTEED BY ANY BANKING OR NONBANKING AFFILIATE OF
NATIONSBANK, ARE NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE
CORPORATION OR ANY OTHER GOVERNMENT AGENCY AND INVOLVE INVESTMENT
RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION, THE COMMISSIONER OF INSURANCE OF THE STATE OF NORTH
CAROLINA (THE "COMMISSIONER") OR ANY STATE SECURITIES COMMISSION NOR
HAS THE SECURITIES AND EXCHANGE COMMISSION, THE COMMISSIONER OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is , 1996.
(A redherring appears on the left-hand side of this page, rotated
90 degrees. Text is as follows:)
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY STATE.
<PAGE>
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, previously filed by the Corporation with the
Securities and Exchange Commission (the "Commission") pursuant to Section 13 of
the Securities Exchange Act of 1934, as amended (the "1934 Act"), are
incorporated herein by reference:
(a) The Corporation's Annual Report on Form 10-K for the year ended
December 31, 1995;
(b) The Corporation's Quarterly Reports on Form 10-Q for the quarters
ended March 31, 1996 and June 30, 1996;
(c) The Corporation's Current Reports on Form 8-K filed January 12,
1996, February 1, 1996, March 8, 1996, April 17, 1996, May 16, 1996, July
5, 1996, July 31, 1996, September 6, 1996 (as amended by Form 8-K/A-1 filed
September 11, 1996) and September 20, 1996 (as amended by Form 8-K/A filed
September 23, 1996); and
(d) The description of the Corporation's Common Stock contained in its
registration statement filed pursuant to Section 12 of the 1934 Act, and
any amendment or report filed for the purpose of updating such description,
including the Corporation's Current Report on Form 8-K filed on September
21, 1994.
All reports and any definitive proxy or information statements filed by the
Corporation with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of
the 1934 Act subsequent to the date of this Prospectus and prior to the
termination of the offering of the Securities offered hereby shall be deemed to
be incorporated by reference in this Prospectus and to be a part hereof from the
date of filing of such documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed to
be modified or superseded for purposes of this Prospectus to the extent that a
statement contained herein or in any other subsequently filed document which
also is or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute a part of this
Prospectus.
THE CORPORATION WILL PROVIDE WITHOUT CHARGE TO EACH PERSON TO WHOM THIS
PROSPECTUS IS DELIVERED, ON THE WRITTEN OR ORAL REQUEST OF ANY SUCH PERSON, A
COPY OF ANY OR ALL OF THE DOCUMENTS INCORPORATED HEREIN BY REFERENCE (OTHER THAN
EXHIBITS TO SUCH DOCUMENTS WHICH ARE NOT SPECIFICALLY INCORPORATED BY REFERENCE
IN SUCH DOCUMENTS). WRITTEN REQUESTS FOR SUCH COPIES SHOULD BE DIRECTED TO JOHN
E. MACK, SENIOR VICE PRESIDENT AND TREASURER, NATIONSBANK CORPORATION,
NATIONSBANK CORPORATE CENTER, CORPORATE TREASURY DIVISION, CHARLOTTE, NORTH
CAROLINA 28255. TELEPHONE REQUESTS MAY BE DIRECTED TO (704) 386-5972.
AVAILABLE INFORMATION
NationsBank is subject to the informational requirements of the 1934 Act
and, in accordance therewith, files reports, proxy statements and other
information with the Commission. Such reports, proxy statements and other
information can be inspected and copied at the following public reference
facilities maintained by the Commission: 450 Fifth Street, N.W., Washington,
D.C. 20549; 7 World Trade Center, Suite 1300, New York, New York 10048; and the
Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois
60661-2511. Copies of such material may also be obtained by mail from the Public
Reference Section of the Commission at 450 Fifth Street, N.W., Room 1024,
Washington, D.C. 20549, upon payment of prescribed rates. The Commission
maintains an Internet web site that contains reports, proxy and information
statements and other information regarding issuers who file electronically with
the Commission. The address of that site is http://www.sec.gov. In addition,
reports, proxy statements and other information concerning NationsBank may be
inspected at the offices of the New York Stock Exchange, Inc., 20 Broad Street,
New York, New York 10005 and at the offices of The Pacific Stock Exchange
Incorporated, 301 Pine Street, San Francisco, California 94104.
2
<PAGE>
NATIONSBANK CORPORATION
GENERAL
NationsBank is a bank holding company established as a North Carolina
corporation in 1968 and is registered under the Bank Holding Company Act of
1956, as amended (the "BHCA"), with its principal assets being the stock of its
subsidiaries. Through its banking subsidiaries (the "Banks") and its various
non-banking subsidiaries, NationsBank provides banking and banking-related
services, primarily throughout the Southeast and Mid-Atlantic states and Texas.
The principal executive offices of NationsBank are located at NationsBank
Corporate Center in Charlotte, North Carolina 28255. Its telephone number is
(704) 386-5000.
OPERATIONS
NationsBank provides a diversified range of banking and certain nonbanking
financial services and products through its various subsidiaries. NationsBank
manages its business activities through three major business units: the General
Bank, Global Finance and Financial Services.
The General Bank provides comprehensive services in the commercial and
retail banking fields, including the origination and servicing of home mortgage
loans, the issuance and servicing of credit cards (through a Delaware
subsidiary), indirect lending, dealer finance and certain insurance services.
The General Bank also offers full service brokerage services and discount
brokerage services and provides investment advisory services to a proprietary
mutual fund, as well as investment management, banking and fiduciary services
through subsidiaries of NationsBank. As of June 30, 1996, the General Bank
operated 1,948 banking offices through the following Banks: NationsBank, N.A.
(serving the states of North Carolina, South Carolina, Maryland and Virginia and
the District of Columbia); NationsBank, N.A. (South) (serving the states of
Florida and Georgia); NationsBank of Kentucky, N.A.; NationsBank of Tennessee,
N.A; NationsBank of Texas, N.A.; and Sun World, N.A. (serving the states of
Texas and New Mexico). The General Bank also provides fully automated, 24-hour
cash dispensing and depositing services throughout the states in which it is
located, through 3,333 automated teller machines.
Global Finance provides comprehensive corporate and investment banking as
well as trading and distribution services to domestic and international
customers. The group serves as a principal lender and investor, as well as an
advisor, arranger and underwriter, and manages treasury and trade transactions
for clients and customers. Loan origination and syndication, asset-backed
lending, leasing, factoring, project finance and mergers and acquisitions are
representative of the services provided by the group. Global Finance also
underwrites, trades and distributes a wide range of securities (including
bank-eligible securities and, to a limited extent, bank-ineligible securities as
authorized by the Board of Governors of the Federal Reserve System (the "Federal
Reserve Board")), and trades and distributes a wide range of derivative products
in certain interest rate, foreign exchange, commodity and equity markets. Global
Finance provides its services through various offices located in major United
States cities as well as in London, Frankfurt, Singapore, Bogota, Mexico City,
Grand Cayman, Nassau, Seoul, Tokyo, Osaka, Taipei and Hong Kong.
Financial Services includes NationsCredit Consumer Corporation, primarily a
consumer finance subsidiary, and NationsCredit Commercial Corporation, primarily
a commercial finance subsidiary. NationsCredit Consumer Corporation, which has
approximately 331 offices located in 36 states, provides personal, mortgage and
automobile loans to consumers and retail finance programs to dealers.
NationsCredit Commercial Corporation consists of seven divisions that specialize
in one or more of the following areas: equipment loans and leasing; loans for
debt restructuring, mergers and acquisitions and working capital; real estate,
golf/recreational and health care financing; and inventory financing to
manufacturers, distributors and dealers.
As part of its operations, NationsBank regularly evaluates the potential
acquisition of, and holds discussions with, various financial institutions and
other businesses of a type eligible for bank holding company investment. In
addition, NationsBank regularly analyzes the values of, and submits bids for,
the acquisition of customer-based funds and other liabilities and assets of such
financial institutions and other businesses. As a general rule, NationsBank
publicly announces such material acquisitions when a definitive agreement has
been reached.
3
<PAGE>
SUPERVISION AND REGULATION
GENERAL. As a registered bank holding company, NationsBank is subject to
the supervision of, and to regular inspection by, the Federal Reserve Board. The
Banks are organized as national banking associations, which are subject to
regulation, supervision and examination by the Office of the Comptroller of the
Currency (the "Comptroller"). The Banks are also subject to regulation by the
Federal Deposit Insurance Corporation (the "FDIC") and other federal regulatory
agencies. In addition to banking laws, regulations and regulatory agencies,
NationsBank and its subsidiaries and affiliates are subject to various other
laws and regulations and supervision and examination by other regulatory
agencies, all of which directly or indirectly affect the Corporation's
operations, management and ability to make distributions. The following
discussion summarizes certain aspects of those laws and regulations that affect
NationsBank.
Under the BHCA, the activities of NationsBank, and those of companies which
it controls or in which it holds more than 5% of the voting stock, are limited
to banking or managing or controlling banks or furnishing services to or
performing services for its subsidiaries, or any other activity which the
Federal Reserve Board determines to be so closely related to banking or managing
or controlling banks as to be a proper incident thereto. In making such
determinations, the Federal Reserve Board is required to consider whether the
performance of such activities by a bank holding company or its subsidiaries can
reasonably be expected to produce benefits to the public such as greater
convenience, increased competition or gains in efficiency that outweigh possible
adverse effects, such as undue concentration of resources, decreased or unfair
competition, conflicts of interest or unsound banking practices. Generally, bank
holding companies, such as NationsBank, are required to obtain prior approval of
the Federal Reserve Board to engage in any new activity not previously approved
by the Federal Reserve Board or to acquire more than 5% of any class of voting
stock of any company.
The BHCA also requires bank holding companies to obtain the prior approval
of the Federal Reserve Board before acquiring more than 5% of any class of
voting stock of any bank which is not already majority-owned by the bank holding
company. Pursuant to the Riegle-Neal Interstate Banking and Branching Efficiency
Act of 1994 (the "Interstate Banking and Branching Act"), a bank holding company
became able to acquire banks in states other than its home state beginning
September 29, 1995, without regard to the permissibility of such acquisition
under state law, but subject to any state requirement that the bank has been
organized and operating for a minimum period of time, not to exceed five years,
and the requirement that the bank holding company, prior to or following the
proposed acquisition, controls no more than 10% of the total amount of deposits
of insured depository institutions in the United States and no more than 30% of
such deposits in that state (or such lesser or greater amount set by state law).
The Interstate Banking and Branching Act also authorizes banks to merge
across state lines, therefore creating interstate branches, beginning June 1,
1997. Under such legislation, each state has the opportunity either to "opt out"
of this provision, thereby prohibiting interstate branching in such states, or
to "opt in" at an earlier time, thereby allowing interstate branching within
that state prior to June 1, 1997. Furthermore, pursuant to such act, a bank is
now able to open new branches in a state in which it does not already have
banking operations if the laws of such state permit such DE NOVO branching. Of
those states in which the Banks are located, Delaware, Maryland, New Mexico,
North Carolina and Virginia have enacted legislation to "opt in," thereby
permitting interstate branching prior to June 1, 1997, and Texas has adopted
legislation to "opt out" of the interstate branching provisions (which Texas law
currently expires on September 2, 1999).
As previously described, NationsBank regularly evaluates merger and
acquisition opportunities, and it anticipates that it will continue to evaluate
such opportunities in light of the new legislation.
Proposals to change the laws and regulations governing the banking industry
are frequently introduced in Congress, in the state legislatures and before the
various bank regulatory agencies.
CAPITAL AND OPERATIONAL REQUIREMENTS. The Federal Reserve Board, the
Comptroller and the FDIC have issued substantially similar risk-based and
leverage capital guidelines applicable to United States banking organizations.
In addition, those regulatory agencies may from time to time require that a
banking organization maintain capital above the minimum levels, whether because
of its financial condition or actual or anticipated growth.
The Federal Reserve Board risk-based guidelines define a two-tier capital
framework. Tier 1 capital consists of common and qualifying preferred
shareholders' equity, less certain intangibles and other adjustments.
4
<PAGE>
Tier 2 capital consists of subordinated and other qualifying debt, and the
allowance for credit losses up to 1.25% of risk-weighted assets. The sum of Tier
1 and Tier 2 capital less investments in unconsolidated subsidiaries represents
qualifying total capital, at least 50% of which must consist of Tier 1 capital.
Risk-based capital ratios are calculated by dividing Tier 1 and total capital by
risk-weighted assets. Assets and off-balance sheet exposures are assigned to one
of four categories of risk-weights, based primarily on relative credit risk. The
minimum Tier 1 capital ratio is 4% and the minimum total capital ratio is 8%.
The Corporation's Tier 1 and total risk-based capital ratios under these
guidelines at June 30, 1996 were 7.58% and 11.93%, respectively.
The leverage ratio is determined by dividing Tier 1 capital by adjusted
average total assets. Although the stated minimum ratio is 3%, most banking
organizations are required to maintain ratios of at least 100 to 200 basis
points above 3%. The Corporation's leverage ratio at June 30, 1996 was 6.64%.
Management believes that NationsBank meets its leverage ratio requirement.
The Federal Deposit Insurance Corporation Improvement Act of 1991
("FDICIA"), among other things, identifies five capital categories for insured
depository institutions (well capitalized, adequately capitalized,
undercapitalized, significantly undercapitalized and critically
undercapitalized) and requires the respective Federal regulatory agencies to
implement systems for "prompt corrective action" for insured depository
institutions that do not meet minimum capital requirements within such
categories. FDICIA imposes progressively more restrictive constraints on
operations, management and capital distributions, depending on the category in
which an institution is classified. Failure to meet the capital guidelines could
also subject a banking institution to capital raising requirements. An
"undercapitalized" bank must develop a capital restoration plan and its parent
holding company must guarantee that bank's compliance with the plan. The
liability of the parent holding company under any such guarantee is limited to
the lesser of 5% of the bank's assets at the time it became "undercapitalized"
or the amount needed to comply with the plan. Furthermore, in the event of the
bankruptcy of the parent holding company, such guarantee would take priority
over the parent's general unsecured creditors. In addition, FDICIA requires the
various regulatory agencies to prescribe certain non-capital standards for
safety and soundness relating generally to operations and management, asset
quality and executive compensation and permits regulatory action against a
financial institution that does not meet such standards.
The various regulatory agencies have adopted substantially similar
regulations that define the five capital categories identified by FDICIA, using
the total risk-based capital, Tier 1 risk-based capital and leverage capital
ratios as the relevant capital measures. Such regulations establish various
degrees of corrective action to be taken when an institution is considered
undercapitalized. Under the regulations, a "well capitalized" institution must
have a Tier 1 capital ratio of at least 6%, a total capital ratio of at least
10% and a leverage ratio of at least 5% and not be subject to a capital
directive order. An "adequately capitalized" institution must have a Tier 1
capital ratio of at least 4%, a total capital ratio of at least 8% and a
leverage ratio of at least 4%, or 3% in some cases. Under these guidelines, as
of June 30, 1996, each of the Banks was considered well capitalized.
Banking agencies have recently adopted final regulations which mandate that
regulators take into consideration concentrations of credit risk and risks from
non-traditional activities, as well as an institution's ability to manage those
risks, when determining the adequacy of an institution's capital. This
evaluation will be made as a part of the institution's regular safety and
soundness examination. Banking agencies also have recently adopted final
regulations requiring regulators to consider interest rate risk (when the
interest rate sensitivity of an institution's assets does not match the
sensitivity of its liabilities or its off-balance-sheet position) in the
evaluation of a bank's capital adequacy. Concurrently, banking agencies have
proposed a methodology for evaluating interest rate risk. After gaining
experience with the proposed measurement process, these banking agencies intend
to propose further regulations to establish an explicit risk-based capital
charge for interest rate risk.
DISTRIBUTIONS. The Corporation's funds for cash distributions to its
shareholders are derived from a variety of sources, including cash and temporary
investments. The primary source of such funds, however, is dividends received
from the Banks. The amount of dividends that each Bank may declare in a calendar
year without approval of the Comptroller is the Bank's net profits for that
year, as defined by statute, combined with its net retained profits, as defined,
for the preceding two years. In addition, from time to time NationsBank applies
for, and may receive, permission from the Comptroller for one or more of the
Banks to declare special dividends. As of January 1, 1996, the Banks can
initiate dividend payments without prior regulatory approval of up
5
<PAGE>
to $905 million plus an additional amount equal to their net profits for 1996 up
to the date of any such dividend declaration.
In addition to the foregoing, the ability of NationsBank and the Banks to
pay dividends may be affected by the various minimum capital requirements and
the capital and non-capital standards established under FDICIA as described
above. Furthermore, the Comptroller may prohibit the payment of a dividend by a
national bank if it determines that such payment would constitute an unsafe or
unsound practice. The right of NationsBank, its shareholders and its creditors
to participate in any distribution of the assets or earnings of its subsidiaries
is further subject to the prior claims of creditors of the respective
subsidiaries.
SOURCE OF STRENGTH. According to Federal Reserve Board policy, bank holding
companies are expected to act as a source of financial strength to each
subsidiary bank and to commit resources to support each such subsidiary. This
support may be required at times when a bank holding company may not be able to
provide such support. In the event of a loss suffered or anticipated by the
FDIC -- either as a result of default of a banking or thrift subsidiary of
NationsBank or related to FDIC assistance provided to a subsidiary in danger of
default -- the other Banks may be assessed for the FDIC's loss, subject to
certain exceptions.
USE OF PROCEEDS
The net proceeds from the sale of the Securities will be used for general
corporate purposes, including the Corporation's working capital needs, the
funding of investments in, or extensions of credit to, its banking and
nonbanking subsidiaries, possible acquisitions of other financial institutions
or their assets or liabilities, possible acquisitions of or investments in other
businesses of a type eligible for bank holding companies and possible reduction
of outstanding indebtedness or repurchase of outstanding equity securities of
the Corporation. Pending such use, the Corporation may temporarily invest the
net proceeds in investment grade securities. The Corporation may, from time to
time, engage in additional capital financings of a character and in amounts to
be determined by the Corporation in light of its needs at such time or times and
in light of prevailing market conditions. If the Corporation elects at the time
of issuance of Securities to make different or more specific use of proceeds
other than that set forth herein, such use will be described in the applicable
Prospectus Supplement.
RATIOS OF EARNINGS TO COMBINED FIXED CHARGES
AND PREFERRED STOCK DIVIDENDS
The following are the consolidated ratios of earnings to combined fixed
charges and preferred stock dividend requirements for the six months ended June
30, 1996 and for each of the years in the five-year period ended December 31,
1995:
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED
JUNE 30, DECEMBER 31,
1996 1995 1994 1993 1992 1991
<S> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Combined Fixed Charges and Preferred Stock
Dividends:
Excluding interest on deposits......................................... 1.8 1.6 1.8 2.3 2.3 1.1
Including interest on deposits......................................... 1.4 1.4 1.5 1.5 1.4 1.0
</TABLE>
For purposes of computing the consolidated ratios, earnings represent net
income of the Corporation plus applicable income taxes and fixed charges, less
capitalized interest and the equity in undistributed earnings of unconsolidated
subsidiaries and associated companies. Fixed charges represent interest expense
(exclusive of interest on deposits in one case and inclusive of such interest in
the other), capitalized interest, amortization of debt discount and appropriate
issuance costs and one-third (the amount deemed to represent an appropriate
interest factor) of net rent expense under all lease commitments. Preferred
stock dividend requirements represent dividend requirements on the outstanding
preferred stock adjusted to reflect the pre-tax earnings that would be required
to cover such dividend requirements.
6
<PAGE>
PLAN OF DISTRIBUTION
The Corporation may offer and sell the Securities in one or more of the
following ways: (i) through underwriters or dealers; (ii) through agents; or
(iii) directly by the Corporation to one or more purchasers. Such underwriters,
dealers or agents may be affiliates of NationsBank. The Prospectus Supplement
with respect to a particular offering of any Securities will set forth the terms
of the offering of such Securities, including the name or names of any
underwriters or agents with whom NationsBank has entered into arrangements with
respect to the sale of such Securities, the public offering or purchase price of
such Securities and the proceeds to the Corporation from such sales, and any
underwriting discounts, agency fees or commissions and other items constituting
underwriters' compensation, the initial public offering price, any discounts or
concessions to be allowed or reallowed or paid to dealers and the securities
exchange, if any, on which such Securities may be listed.
If underwriters are used in the offer and sale of Securities, the
Securities will be acquired by the underwriters for their own account and may be
resold from time to time in one or more transactions, including negotiated
transactions, at a fixed public offering price or at varying prices determined
at the time of sale. The Securities may be offered to the public either through
underwriting syndicates represented by managing underwriters, or by underwriters
without a syndicate, all of which underwriters in either case will be designated
in the applicable Prospectus Supplement. Unless otherwise set forth in the
applicable Prospectus Supplement, under the terms of the underwriting agreement,
the obligations of the underwriters to purchase Securities will be subject to
certain conditions precedent and the underwriters will be obligated to purchase
all the Securities if any are purchased. Any initial public offering price and
any discounts or concessions allowed or reallowed or paid to dealers may be
changed from time to time.
Securities also may be offered and sold directly by the Corporation or
through agents designated by the Corporation from time to time. Any agent
involved in the offer or sale of the Securities with respect to which this
Prospectus is delivered will be named in, and any commissions payable by the
Corporation to such agent will be set forth in or calculable from, the
applicable Prospectus Supplement. Unless otherwise indicated in the Prospectus
Supplement, any such agent will be acting on a best efforts basis for the period
of its appointment.
If so indicated in the applicable Prospectus Supplement, the Corporation
may authorize underwriters, dealers or agents to solicit offers by certain
institutions to purchase Securities from the Corporation at the public offering
price set forth in such Prospectus Supplement pursuant to delayed delivery
contracts ("Delayed Delivery Contracts") providing for payment and delivery on
the date or dates stated in the Prospectus Supplement. Each Delayed Delivery
Contract will be for an amount of Securities not less than and, unless the
Corporation otherwise agrees, the aggregate amount of Securities sold pursuant
to Delayed Delivery Contracts shall be not more than the respective minimum and
maximum amounts stated in the Prospectus Supplement. Institutions with which
Delayed Delivery Contracts, when authorized, may be made include commercial and
savings banks, insurance companies, pension funds, investment companies and
educational and charitable institutions, but shall in all cases be subject to
the approval of the Corporation in its sole discretion. The obligations of the
purchaser under any Delayed Delivery Contract to pay for and take delivery of
Securities will not be subject to any conditions except that (i) the purchase of
Securities by such institution shall not at the time of delivery be prohibited
under the laws of the jurisdiction to which such institution is subject; and
(ii) any related sale of Securities to underwriters shall have occurred. A
commission set forth in the Prospectus Supplement will be paid to underwriters
soliciting purchases of Securities pursuant to Delayed Delivery Contracts
accepted by the Corporation. The underwriters will not have any responsibility
in respect of the validity or performance of Delayed Delivery Contracts.
Any series of Preferred Stock offered and sold pursuant to this Prospectus
and the applicable Prospectus Supplement will be new issues of securities with
no established trading market. Any underwriters to whom such Securities are sold
by the Corporation for public offering and sale may make a market in such
Securities, but such underwriters will not be obligated to do so and may
discontinue any market making at any time without notice. No assurance can be
given as to the liquidity of the trading market for any Securities.
Any underwriter, dealer or agent participating in the distribution of any
Securities may be deemed to be an underwriter, as that term is defined in the
Securities Act of 1933, as amended (the "1933 Act"), of the Securities so
offered and sold, and any discounts or commissions received by them from
NationsBank and any
7
<PAGE>
profit realized by them on the sale or resale of the Securities may be deemed to
be underwriting discounts and commissions under the 1933 Act.
Under agreements entered into with the Corporation, underwriters, dealers
and agents may be entitled to indemnification by the Corporation against certain
civil liabilities, including liabilities under the 1933 Act, or to contribution
with respect to payments which the underwriters or agents may be required to
make in respect thereof.
The participation of an affiliate or subsidiary of NationsBank in the offer
and sale of the Securities will comply with the requirements of Section 2720 of
the Conduct Rules of the National Association of Securities Dealers, Inc. (the
"NASD") regarding the participation in a distribution of securities by an
affiliate. No NASD member participating in offers and sales of the Securities
will execute a transaction in the Securities in a discretionary account without
the prior written specific approval of the member's customer.
This Prospectus and related Prospectus Supplements may also be used by
direct or indirect wholly-owned subsidiaries of NationsBank in connection with
offers and sales related to secondary market transactions in the Securities.
Such subsidiaries may act as principal or agent in such transactions. Any such
sales will be made at prices related to prevailing market prices at the time of
sale.
Underwriters, dealers and agents also may be customers of, engage in
transactions with, or perform other services for the Corporation in the ordinary
course of business.
DESCRIPTION OF PREFERRED STOCK
GENERAL
NationsBank has authorized 45,000,000 shares of preferred stock and may
issue such preferred stock in one or more series, each with such preferences,
limitations, designations, conversion rights, voting rights, dividend rights,
voluntary and involuntary liquidation rights and other rights as it may
determine. NationsBank has designated 3,000,000 shares of ESOP Convertible
Preferred Stock, Series C (the "ESOP Preferred Stock"), of which 2,445,143
shares were issued and outstanding as of June 30, 1996.
The ability of NationsBank to pay dividends with respect to its preferred
stock or other capital stock may be affected by the ability of the Banks to pay
dividends. The ability of the Banks, as well as of the Corporation, to pay
dividends in the future currently is, and could be further, influenced by bank
regulatory requirements and capital guidelines. See "NATIONSBANK
CORPORATION -- Supervision and Regulation."
THE PREFERRED STOCK
GENERAL. The Preferred Stock shall have the general dividend, voting and
liquidation preference rights set forth below unless otherwise provided in the
Prospectus Supplement relating to a particular series of Preferred Stock offered
thereby. Reference is made to the applicable Prospectus Supplement for specific
terms, including, where applicable: (i) the title and stated value of such
Preferred Stock; (ii) the aggregate number of shares of Preferred Stock so
offered; (iii) the price at which such Preferred Stock will be issued; (iv) the
dividend rates or method of calculation, the dividend period and the dates on
which dividends shall be payable; (v) whether any such dividends will be
cumulative or noncumulative, and if cumulative, the date from which dividends
shall commence to cumulate; (vi) the dates on which the Preferred Stock will be
subject to redemption at the option of the Corporation, if applicable, and any
related redemption terms; (vii) any mandatory redemption or sinking fund
provisions; (viii) any rights on the part of the holder or NationsBank to
convert the Preferred Stock into shares of Common Stock; and (ix) any additional
voting, liquidation, preemptive and other rights, preferences, privileges,
limitations and restrictions. The description of certain provisions of the
Preferred Stock set forth below and in the applicable Prospectus Supplement does
not purport to be complete and is subject to and qualified in its entirety by
reference to the Articles of Amendment to the Articles of Incorporation of the
Corporation relating to the particular series of Preferred Stock, which will be
filed with the Commission at or prior to the time of sale of such Preferred
Stock.
NationsBank may, at its option, elect to offer Depositary Shares evidenced
by depositary receipts (the "Depositary Receipts"), each representing a
fractional interest (to be specified in the Prospectus Supplement
8
<PAGE>
relating to the particular series of Preferred Stock) in a share of a particular
series of the Preferred Stock issued and deposited with a Depositary (as defined
below). See "DESCRIPTION OF DEPOSITARY SHARES" below.
The Preferred Stock ranks senior to the Common Stock as to the payment of
dividends and the distribution of assets on liquidation, dissolution and winding
up of the Corporation. The dividend and liquidation preference rights of the
Preferred Stock relative to the ESOP Preferred Stock or any future series of
preferred stock of the Corporation shall be set forth in the Prospectus
Supplement relating to the particular series of Preferred Stock offered thereby.
When issued in accordance with the terms of the Prospectus and the
applicable Prospectus Supplement, the Preferred Stock will be validly issued,
fully paid and nonassessable.
DIVIDENDS. When and as declared by the Board of Directors of the
Corporation, holders of the Preferred Stock will be entitled to receive
quarterly cash dividends at such rates and on such dates as will be set forth in
the applicable Prospectus Supplement. All dividends shall be paid out of funds
of NationsBank legally available for such purpose. Except as otherwise set forth
in the applicable Prospectus Supplement, no dividends shall be paid on other
shares of the Corporation, nor shall any shares of other capital stock of the
Corporation be redeemed, repurchased or otherwise acquired for any consideration
(or any moneys be paid into a sinking fund for the redemption of shares of such
stock) by the Corporation, if dividends on any series of Preferred Stock are in
arrears.
VOTING. Except as required by applicable law or as otherwise set forth in
the applicable Prospectus Supplement, the holders of Preferred Stock shall have
no voting rights with regard to matters submitted to a general vote of the
shareholders of the Corporation.
LIQUIDATION PREFERENCE. In the event of any liquidation, dissolution or
winding up of the Corporation, either voluntary or involuntary, the holders of
any series of Preferred Stock shall be entitled to receive, by reason of their
ownership thereof, after distributions to holders of any series or class of
capital stock of the Corporation as may be set forth in the applicable
Prospectus Supplement, an amount equal to the appropriate stated or liquidation
value of the shares of such series (as set forth in the applicable Prospectus
Supplement), plus an amount equal to accrued and unpaid dividends, if any,
through the date of such payment. If upon the occurrence of such event, the
assets and funds to be thus distributed among the holders of such Preferred
Stock shall be insufficient to permit the payment to such holders of the full
amount due, then the holders of such Preferred Stock shall share ratably in any
distribution of assets of the Corporation in proportion to the respective
amounts which otherwise would be payable with respect to the shares held by them
upon such distribution if all amounts payable on or with respect to such shares
were paid in full.
ESOP PREFERRED STOCK
THE FOLLOWING SUMMARY OF THE ESOP PREFERRED STOCK IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO THE DESCRIPTION OF SUCH SERIES OF PREFERRED STOCK
CONTAINED IN THE CORPORATION'S RESTATED ARTICLES OF INCORPORATION, AS AMENDED.
The ESOP Preferred Stock was first issued in the transaction by which
NationsBank was formed from the merger of NCNB Corporation and C&S/Sovran
Corporation in 1991 upon the conversion of shares of ESOP Convertible Preferred
Stock, Series C of C&S/Sovran Corporation. All shares are held by the trustee
under the NationsBank Corporation Retirement Savings Plan (the "ESOP").
Shares of ESOP Preferred Stock have no preemptive or preferential rights to
purchase or subscribe for shares of NationsBank capital stock of any class and
are not subject to any sinking fund or other obligation of NationsBank to
repurchase or retire the series, except as discussed below.
Each share of ESOP Preferred Stock is entitled to an annual dividend,
subject to certain adjustments, of $3.30 per share, payable semiannually. Unpaid
dividends accumulate as of the date on which they first became payable, without
interest. So long as any shares of ESOP Preferred Stock are outstanding, no
dividend may be declared, paid or set apart for payment on any other series of
stock ranking on a parity with the ESOP Preferred Stock as to dividends, unless
like dividends have been declared and paid, or set apart for payment, on the
ESOP Preferred Stock for all dividend payment periods ending on or before the
dividend payment date for such parity stock, ratably in proportion to their
respective amounts of accumulated and unpaid dividends.
9
<PAGE>
NationsBank generally may not declare, pay or set apart for payment any
dividends (except for, among other things, dividends payable solely in shares of
stock ranking junior to the ESOP Preferred Stock as to dividends or upon
liquidation) on, make any other distribution on, or make payment on account of
the purchase, redemption or other retirement of, any other class or series of
NationsBank capital stock ranking junior to the ESOP Preferred Stock as to
dividends or upon liquidation, until full cumulative dividends on the ESOP
Preferred Stock have been declared and paid or set apart for payment when due.
The holder of the ESOP Preferred Stock is entitled to vote on all matters
submitted to a vote of the holders of Common Stock and votes together with the
holders of Common Stock as one class. Except as otherwise required by applicable
law, the holder of the ESOP Preferred Stock has no special voting rights. To the
extent that the holder of such shares is entitled to vote, each share is
entitled to the number of votes equal to the number of shares of Common Stock
into which such share of ESOP Preferred Stock could be converted on the record
date for determining the shareholders entitled to vote, rounded to the nearest
whole vote.
Shares of the ESOP Preferred Stock initially are convertible into Common
Stock at a conversion rate equal to 0.84 shares of Common Stock per share of
ESOP Preferred Stock and a conversion price of $42.50 per 0.84 shares of Common
Stock, subject to certain customary anti-dilution adjustments.
In the event of any voluntary or involuntary dissolution, liquidation or
winding-up of NationsBank, the holder of the ESOP Preferred Stock will be
entitled to receive out of the assets of NationsBank available for distribution
to shareholders, subject to the rights of the holders of any Preferred Stock
ranking senior to or on a parity with the ESOP Preferred Stock as to
distributions upon liquidation, dissolution or winding-up but before any amount
will be paid or distributed among the holders of Common Stock or any other
shares ranking junior to the ESOP Preferred Stock as to such distributions,
liquidating distributions of $42.50 per share plus all accrued and unpaid
dividends thereon to the date fixed for distribution. If, upon any voluntary or
involuntary dissolution, liquidation or winding-up of NationsBank, the amounts
payable with respect to the ESOP Preferred Stock and any other stock ranking on
a parity therewith as to any such distribution are not paid in full, the holder
of the ESOP Preferred Stock and such other stock will share ratably in any
distribution of assets in proportion to the full respective preferential amounts
to which they are entitled. After payment of the full amount of the liquidating
distribution to which it is entitled, the holder of the ESOP Preferred Stock
will not be entitled to any further distribution of assets by NationsBank.
Neither a merger or consolidation of NationsBank with or into any other
corporation, nor a merger or consolidation of any other corporation with or into
NationsBank nor a sale, transfer or lease of all or any portion of NationsBank's
assets, will be deemed to be a dissolution, liquidation or winding-up of
NationsBank.
The ESOP Preferred Stock is redeemable, in whole or in part, at the option
of NationsBank, at any time. The redemption price for the shares of the ESOP
Preferred Stock, which may be paid in cash or shares of Common Stock, will
depend upon the time of redemption. Specifically, the redemption price for the
12-month period beginning July 1, 1996 is $43.49 per share; on each succeeding
July 1, the redemption price will be reduced by $.33 per share, except that on
and after July 1, 1999, the redemption price will be $42.50 per share. In each
case, the redemption price also must include all accrued and unpaid dividends to
the date of redemption. To the extent that the ESOP Preferred Stock is treated
as Tier 1 capital for bank regulatory purposes, the approval of the Federal
Reserve Board may be required for redemption of the ESOP Preferred Stock.
NationsBank is required to redeem shares of the ESOP Preferred Stock at the
option of the holder of such shares to the extent necessary either to provide
for distributions required to be made under the ESOP or to make payments of
principal, interest or premium due and payable on any indebtedness incurred by
the holder of the shares. The redemption price in such case will be the greater
of $42.50 per share plus accrued and unpaid dividends to the date of redemption
or the fair market value of the aggregate number of shares of Common Stock into
which a share of ESOP Preferred Stock then is convertible.
DESCRIPTION OF DEPOSITARY SHARES
GENERAL
NationsBank may, at its option, elect to offer fractional interests in the
Preferred Stock, rather than whole shares of such securities. In the event such
option is exercised, NationsBank will provide for the issuance by a
10
<PAGE>
Depositary to the public of receipts of Depositary Shares, each of which will
represent a fractional interest in a share of a particular series of the
Preferred Stock, as set forth in the Prospectus Supplement for such series of
Preferred Stock.
Certain general terms and provisions of the form of Deposit Agreement (as
described below), the Depositary Shares and the form of Depositary Receipts to
which a Prospectus Supplement may relate are set forth below. The particular
terms of the Preferred Stock offered by any Prospectus Supplement and the
extent, if any, to which such general provisions may apply to the Depositary
Shares will be described in the applicable Prospectus Supplement. The
descriptions below and in any Prospectus Supplement do not purport to be
complete and are subject to and qualified in their entirety by reference to the
Deposit Agreement and the Depositary Receipts, the forms of which are
incorporated by reference in the Registration Statement of which this Prospectus
is a part and the definitive forms of which will be filed with the Commission at
the time of sale of such Depositary Shares.
The shares of any series of the Preferred Stock underlying the Depositary
Shares will be deposited under a separate Deposit Agreement (the "Deposit
Agreement") between NationsBank and a bank or trust company selected by
NationsBank having its principal office in the United States and having a
combined capital and surplus of at least $5,000,000 (the "Depositary"). The
applicable Prospectus Supplement will set forth the name and address of the
Depositary. Subject to the terms of the Deposit Agreement, each owner of a
Depositary Share will be entitled, in proportion to the applicable fractional
interest in a share of Preferred Stock underlying such Depositary Share, to all
the rights and preferences of the Preferred Stock underlying such Depositary
Share (including dividend, voting, redemption, conversion and liquidation
rights).
The Depositary Shares will be evidenced by Depositary Receipts issued
pursuant to the Deposit Agreement. Depositary Receipts will be distributed to
those persons purchasing the fractional shares of the related series of
Preferred Stock in accordance with the terms of the offering as described in the
applicable Prospectus Supplement.
Pending the preparation of definitive engraved Depositary Receipts, the
Depositary may, upon the written order of NationsBank, issue temporary
Depositary Receipts substantially identical to (and entitling the holders
thereof to all the rights pertaining to) the definitive Depositary Receipts but
not in definitive form. Definitive Depositary Receipts will be prepared
thereafter without unreasonable delay and temporary Depositary Receipts will be
exchangeable for definitive Depositary Receipts at the Corporation's expense.
Upon the surrender of Depositary Receipts at the office of the Depositary
(unless the Depositary Shares have been previously called for redemption) and
upon payment by the holder of the charges provided in the Deposit Agreement and
subject to the terms thereof, a holder of Depositary Shares is entitled to have
the Depositary deliver to such holder the number of whole shares of the
Preferred Stock underlying the Depositary Shares evidenced by the surrendered
Depositary Receipts; PROVIDED, HOWEVER, that the holder of such shares of
Preferred Stock will not thereafter be entitled to receive Depositary Shares
therefor. If the Depositary Receipts delivered by the holder evidence a number
of Depositary Shares in excess of the number of Depositary Shares representing
the number of whole shares of the related series of Preferred Stock to be
withdrawn, the Depositary will deliver to such holder at the same time a new
Depositary Receipt evidencing such excess number of Depositary Shares.
DIVIDENDS AND OTHER DISTRIBUTIONS
The Depositary will distribute all cash dividends or other cash
distributions received in respect of the Preferred Stock to the record holders
of Depositary Shares relating to such Preferred Stock in proportion to the
number of such Depositary Shares owned by such holders on the relevant record
date. The Depositary shall distribute only such amount, however, as can be
distributed without attributing to any holder of Depositary Shares a fraction of
one cent, and any balance not so distributed shall be added to and treated as
part of the next sum received by the Depositary for distribution to record
holders of Depositary Shares.
In the event of a distribution other than in cash, the Depositary will
distribute property received by it to the record holders of Depositary Shares
entitled thereto, unless the Depositary determines that it is not feasible to
make such distribution, in which case the Depositary, with the approval of
NationsBank, may sell such property and distribute the net proceeds from such
sale to such holders.
11
<PAGE>
REDEMPTION OF DEPOSITARY SHARES
If a series of the Preferred Stock underlying the Depositary Shares is
subject to redemption, the Depositary Shares will be redeemed from the proceeds
received by the Depositary resulting from the redemption, in whole or in part,
of such series of the Preferred Stock held by the Depositary. The Depositary
shall mail notice of redemption not less than 30 and not more than 45 days prior
to the date fixed for redemption to the record holders of the Depositary Shares
to be so redeemed at their respective addresses appearing in the Depositary's
books. The redemption price per Depositary Share will be equal to the applicable
fraction of the redemption price per share payable with respect to such series
of the Preferred Stock. Whenever NationsBank redeems Preferred Stock held by the
Depositary, the Depositary will redeem as of the same redemption date the number
of Depositary Shares relating to the Preferred Stock so redeemed. If less than
all the Depositary Shares are to be redeemed, the Depositary Shares to be
redeemed will be selected by lot or pro rata as may be determined by the
Depositary.
After the date fixed for redemption, the Depositary Shares so called for
redemption will no longer be deemed to be outstanding and all rights of the
holder of the Depositary Shares will cease, except the right to receive the
moneys payable upon such redemption and any money or other property to which the
holders of such Depositary Shares were entitled upon such redemption upon
surrender to the Depositary of the Depositary Receipts evidencing such
Depositary Shares.
VOTING THE PREFERRED STOCK
Upon receipt of notice of any meeting at which the holders of the Preferred
Stock held by the Depositary are entitled to vote, the Depositary will mail the
information contained in such notice of meeting to the record holders of the
Depositary Shares relating to such Preferred Stock. Each record holder of such
Depositary Shares on the record date (which will be the same date as the record
date for the Preferred Stock) will be entitled to instruct the Depositary as to
the exercise of the voting rights pertaining to the amount of Preferred Stock
underlying such holder's Depositary Shares. The Depositary will endeavor,
insofar as practicable, to vote the amount of Preferred Stock underlying such
Depositary Shares in accordance with such instructions, and NationsBank will
agree to take all action which may be deemed necessary by the Depositary in
order to enable the Depositary to do so. The Depositary will abstain from voting
Preferred Stock to the extent it does not receive specific instructions from the
holders of Depositary Shares relating to such Preferred Stock.
AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT
The form of Depositary Receipt evidencing the Depositary Shares and any
provision of the Deposit Agreement may at any time be amended by agreement
between NationsBank and the Depositary. However, any amendment which materially
and adversely alters the rights of the existing holders of Depositary Shares
will not be effective unless such amendment has been approved by the record
holders of at least a majority in interest of the Depositary Shares then
outstanding. A Deposit Agreement may be terminated by NationsBank or the
Depositary only if (i) all outstanding Depositary Shares relating thereto have
been redeemed or (ii) there has been a final distribution in respect of the
Preferred Stock underlying such Depositary Shares in connection with any
liquidation, dissolution or winding up of NationsBank.
CHARGES OF DEPOSITARY
NationsBank will pay all transfer and other taxes and governmental charges
arising solely from the existence of the depositary arrangements. NationsBank
will pay charges of the Depositary in connection with the initial deposit of the
Preferred Stock and any redemption of the Preferred Stock. Holders of Depositary
Shares will pay other transfer and other taxes and governmental charges and such
other charges as are expressly provided in the Deposit Agreement to be for their
accounts.
MISCELLANEOUS
The Depositary will forward to the holders of Depositary Shares all reports
and communications from NationsBank which are delivered to the Depositary and
which NationsBank is required to furnish to the holders of the Preferred Stock.
12
<PAGE>
Neither the Depositary nor NationsBank will be liable if it is prevented or
delayed by law or any circumstance beyond its control in performing its
obligations under the Deposit Agreement. The obligations of NationsBank and the
Depositary under the Deposit Agreement will be limited to performance in good
faith of their respective duties thereunder and neither entity will be obligated
to prosecute or defend any legal proceeding in respect of any Depositary Shares
or Preferred Stock unless satisfactory indemnity is furnished. Each entity may
rely upon written advice of counsel or accountants, or information provided by
persons presenting Preferred Stock for deposit, holders of Depositary Shares or
other persons believed to be competent and on documents believed to be genuine.
RESIGNATION AND REMOVAL OF DEPOSITARY
The Depositary may resign at any time by delivering to NationsBank notice
of its election to do so, and NationsBank may at any time remove the Depositary,
any such resignation or removal to take effect only upon the appointment of a
successor Depositary and its acceptance of such appointment. Such successor
Depositary must be a bank or trust company having its principal office in the
United States and having a combined capital and surplus of at least $5,000,000.
DESCRIPTION OF COMMON STOCK
THE FOLLOWING SUMMARY OF THE COMMON STOCK IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO THE DESCRIPTION OF THE COMMON STOCK INCORPORATED HEREIN BY
REFERENCE.
GENERAL
NationsBank is authorized to issue 800,000,000 shares of its Common Stock,
of which 301,082,855 shares were outstanding as of June 30, 1996. The Common
Stock is traded on the New York Stock Exchange, Inc. and on The Pacific Stock
Exchange Incorporated under the symbol "NB" and on the London Stock Exchange;
certain shares of Common Stock are also listed and traded on the Tokyo Stock
Exchange. As of June 30, 1996, 34.9 million shares were reserved for issuance in
connection with various employee and director benefit plans of NationsBank and
upon the conversion of the ESOP Preferred Stock, and 2.8 million shares were
reserved for issuance under the Corporation's Dividend Reinvestment and Stock
Purchase Plan. After taking into account the shares reserved as described above,
approximately 461.2 million authorized shares of the Common Stock remained
available for issuance for other corporate purposes as of June 30, 1996.
VOTING AND OTHER RIGHTS
The holders of the Common Stock are entitled to one vote per share, and, in
general, a majority of votes cast with respect to a matter is sufficient to take
action upon routine matters. Directors are elected by a plurality of the votes
cast, and each shareholder entitled to vote in such election shall be entitled
to vote each share of stock for as many persons as there are directors to be
elected. In elections for directors, such shareholders do not have the right to
cumulate their votes, so long as the Corporation has a class of shares
registered under Section 12 of the 1934 Act (unless action is taken to provide
otherwise by charter amendment, which action management does not currently
intend to propose). In general, (i) amendments to the Corporation's Restated
Articles of Incorporation must be approved by each voting group entitled to vote
separately thereon by a majority of the votes cast by that voting group, unless
the amendment creates dissenters' rights for a particular voting group, in which
case such amendment must be approved by a majority of the votes entitled to be
cast by such voting group; (ii) a merger or share exchange required to be
approved by shareholders must be approved by each voting group entitled to vote
separately thereon by a majority of the votes entitled to be cast by that voting
group; and (iii) the dissolution of the Corporation, or the sale of all or
substantially all of the property of the Corporation other than in the usual and
regular course of business, must be approved by a majority of all votes entitled
to be cast thereon.
In the event of liquidation of the Corporation, holders of the Common Stock
would be entitled to receive pro rata any assets legally available for
distribution to shareholders with respect to shares held by them, subject to any
prior rights of any preferred stock then outstanding. See "DESCRIPTION OF
PREFERRED STOCK" above.
The Common Stock does not have any preemptive rights, redemption
privileges, sinking fund privileges or conversion rights. All the outstanding
shares of the Common Stock are, and upon proper conversion of any
13
<PAGE>
Preferred Stock all of the shares of Common Stock into which such shares are
converted will be, validly issued, fully paid and nonassessable.
Chase Mellon Shareholder Services acts as transfer agent and registrar for
the Common Stock.
DISTRIBUTIONS
The holders of the Common Stock are entitled to receive such dividends or
distributions as the Board of Directors of the Corporation may declare out of
funds legally available for such payments. The payment of distributions by
NationsBank is subject to the restrictions of North Carolina law applicable to
the declaration of distributions by a business corporation. A corporation
generally may not authorize and make distributions if, after giving effect
thereto, it would be unable to meet its debts as they become due in the usual
course of business or if the corporation's total assets would be less than the
sum of its total liabilities plus the amount that would be needed, if it were to
be dissolved at the time of distribution, to satisfy claims upon dissolution of
shareholders who have preferential rights superior to the rights of the holders
of its common stock. In addition, the payment of distributions to shareholders
is subject to any prior rights of outstanding preferred stock, including the
ESOP Preferred Stock and any other series of Preferred Stock when and if issued
from time to time. See "DESCRIPTION OF PREFERRED STOCK." Share dividends, if any
are declared, may be paid from NationsBank's authorized but unissued shares.
The ability of NationsBank to pay dividends may be affected by the ability
of the Banks to pay dividends. The ability of the Banks, as well as of the
Corporation, to pay dividends in the future currently is, and could be further,
influenced by bank regulatory requirements and capital guidelines. See
"NATIONSBANK CORPORATION -- Supervision and Regulation."
LEGAL OPINIONS
The legality of the Securities will be passed upon for the Corporation by
Smith Helms Mulliss & Moore, L.L.P., Charlotte, North Carolina, and for the
underwriters or agents by Stroock & Stroock & Lavan, New York, New York. As of
the date of this Prospectus, certain members of Smith Helms Mulliss & Moore,
L.L.P., beneficially own approximately 50,000 shares of the Corporation's
Common Stock.
EXPERTS
The consolidated financial statements of the Corporation incorporated in
this Prospectus by reference to the Corporation's Annual Report on Form 10-K for
the year ended December 31, 1995, have been so incorporated in reliance on the
report of Price Waterhouse LLP, independent accountants, given on the authority
of said firm as experts in auditing and accounting.
14
<PAGE>
NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS IN CONNECTION WITH THE OFFERING MADE HEREBY AND, IF GIVEN OR MADE,
SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE CORPORATION. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY
SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE AN IMPLICATION THAT
THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE CORPORATION SINCE THE DATE
HEREOF. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER OR SOLICITATION BY ANYONE
IN ANY STATE IN WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED OR IN WHICH
THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO OR TO
ANYONE TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
PROSPECTUS
Incorporation of Certain Documents by
Reference................................... 2
Available Information......................... 2
NationsBank Corporation....................... 3
Use of Proceeds............................... 6
Ratios of Earnings to Combined Fixed Charges
and Preferred Stock Dividends............... 6
Plan of Distribution.......................... 7
Description of Preferred Stock................ 8
Description of Depositary Shares.............. 10
Description of Common Stock................... 13
Legal Opinions................................ 14
Experts....................................... 14
</TABLE>
$3,000,000,000
NATIONSBANK(Register Mark)
PREFERRED STOCK
DEPOSITARY SHARES
COMMON STOCK
PROSPECTUS
, 1996
<PAGE>
SUBJECT TO COMPLETION [ALTERNATE PAGE -- EQUITY]
PRELIMINARY PROSPECTUS DATED OCTOBER , 1996
[EQUITY]
PROSPECTUS
NATIONSBANK(Register mark)
Preferred Stock
Depositary Shares
Common Stock
NationsBank Corporation ("NationsBank" or the "Corporation") may offer from
time to time shares of its preferred stock (the "Preferred Stock"), which may be
represented by depositary shares (the "Depositary Shares"), and shares of its
common stock (the "Common Stock" and, together with the Preferred Stock and the
Depositary Shares, the "Securities"). NationsBank may sell up to $3,000,000,000
in aggregate initial offering price of the Securities, which may be offered,
separately or together, in one or more series, in amounts, at prices and on
terms to be determined at the time of sale and set forth in one or more
supplements to this Prospectus (a "Prospectus Supplement"). Pursuant to the
terms of the Registration Statement of which this Prospectus constitutes a part,
NationsBank may also offer and sell its unsecured debt securities, which may be
either senior or subordinated (the "Debt Securities"). Any such Debt Securities
will be offered and issued pursuant to the terms of a separate Prospectus
contained in such Registration Statement. The aggregate amount of Securities
that may be offered and sold pursuant hereto is subject to reduction as the
result of the sale of any Debt Securities pursuant to such separate Prospectus
or at the Corporation's discretion.
The applicable Prospectus Supplement will set forth the specific terms of
Securities offered pursuant to this Prospectus, including: (a) in the case of
any series of Preferred Stock, the specific designation, the aggregate number of
shares offered, the dividend rate or method of calculation, the dividend period
and dividend payment dates, whether such dividends will be cumulative or
noncumulative, the liquidation preference, voting rights, if any, any terms for
redemption at the option of the holder or NationsBank, any applicable conversion
provisions in the event that such series is convertible at the option of the
holder or NationsBank into shares of Common Stock, and any other terms of the
offering or the series, and (b) in the case of Common Stock, the aggregate
number of shares offered.
The Securities may be sold (i) through underwriting syndicates represented
by managing underwriters, or by underwriters without a syndicate, with such
underwriters to be designated at the time of sale; (ii) through agents
designated from time to time; or (iii) directly by the Corporation. The names of
any underwriters or agents of NationsBank involved in the sale of the
Securities, and any applicable commissions or discounts, will be set forth in
the applicable Prospectus Supplement, in addition to any other terms of the
offering of such Securities. The net proceeds to the Corporation from such sale
also will be set forth in such Prospectus Supplement.
This Prospectus may not be used to consummate sales of Securities unless
accompanied by a Prospectus Supplement.
THESE SECURITIES ARE NOT SAVINGS ACCOUNTS OR BANK DEPOSITS, ARE NOT OBLIGATIONS
OF OR GUARANTEED BY ANY BANKING OR NONBANKING AFFILIATE OF NATIONSBANK, ARE
NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY
OTHER GOVERNMENT AGENCY AND INVOLVE INVESTMENT RISKS,
INCLUDING POSSIBLE LOSS OF PRINCIPAL.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION, THE COMMISSIONER OF INSURANCE OF THE STATE OF NORTH
CAROLINA (THE "COMMISSIONER") OR ANY STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION, THE COMMISSIONER OR ANY STATE
SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THIS PROSPECTUS AND RELATED PROSPECTUS SUPPLEMENTS ARE TO BE USED BY NATIONSBANC
CAPITAL MARKETS, INC., A BROKER-DEALER AND A DIRECT WHOLLY-OWNED SUBSIDIARY
OF NATIONSBANK, IN CONNECTION WITH OFFERS AND SALES RELATED TO SECONDARY
MARKET TRANSACTIONS IN THE SECURITIES. NATIONSBANK CAPITAL MARKETS,
INC. OR ITS AFFILIATES MAY ACT AS PRINCIPAL OR AGENT IN SUCH
TRANSACTIONS. ANY SUCH SALES WILL BE MADE AT NEGOTIATED PRICES
RELATING TO PREVAILING MARKET PRICES AT THE TIME OF SALE OR
OTHERWISE.
NATIONSBANC CAPITAL MARKETS, INC.
The date of this Prospectus is , 1996.
(A redherring appears on the left-hand side of this page, rotated
90 degrees. Text is as follows:)
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE
SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION
STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO
SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY
STATE.
<PAGE>
[ALTERNATE PAGE -- EQUITY]
to $905 million plus an additional amount equal to their net profits for 1996 up
to the date of any such dividend declaration.
In addition to the foregoing, the ability of NationsBank and the Banks to
pay dividends may be affected by the various minimum capital requirements and
the capital and non-capital standards established under FDICIA as described
above. Furthermore, the Comptroller may prohibit the payment of a dividend by a
national bank if it determines that such payment would constitute an unsafe or
unsound practice. The right of NationsBank, its shareholders and its creditors
to participate in any distribution of the assets or earnings of its subsidiaries
is further subject to the prior claims of creditors of the respective
subsidiaries.
SOURCE OF STRENGTH. According to Federal Reserve Board policy, bank holding
companies are expected to act as a source of financial strength to each
subsidiary bank and to commit resources to support each such subsidiary. This
support may be required at times when a bank holding company may not be able to
provide such support. In the event of a loss suffered or anticipated by the
FDIC -- either as a result of default of a banking or thrift subsidiary of
NationsBank or related to FDIC assistance provided to a subsidiary in danger of
default -- the other Banks may be assessed for the FDIC's loss, subject to
certain exceptions.
USE OF PROCEEDS
The net proceeds from the sale of the Securities will be used for general
corporate purposes, including the Corporation's working capital needs, the
funding of investments in, or extensions of credit to, its banking and
nonbanking subsidiaries, possible acquisitions of other financial institutions
or their assets or liabilities, possible acquisitions of or investments in other
businesses of a type eligible for bank holding companies and possible reduction
of outstanding indebtedness or repurchase of outstanding equity securities of
the Corporation. Pending such use, the Corporation may temporarily invest the
net proceeds in investment grade securities. The Corporation may, from time to
time, engage in additional capital financings of a character and in amounts to
be determined by the Corporation in light of its needs at such time or times and
in light of prevailing market conditions. If the Corporation elects at the time
of issuance of Securities to make different or more specific use of proceeds
other than that set forth herein, such use will be described in the applicable
Prospectus Supplement.
RATIOS OF EARNINGS TO COMBINED FIXED CHARGES
AND PREFERRED STOCK DIVIDENDS
The following are the consolidated ratios of earnings to combined fixed
charges and preferred stock dividend requirements for the six months ended June
30, 1996 and for each of the years in the five-year period ended December 31,
1995:
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED
JUNE 30, DECEMBER 31,
1996 1995 1994 1993 1992 1991
<S> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Combined Fixed Charges and Preferred Stock
Dividends:
Excluding interest on deposits......................................... 1.8 1.6 1.8 2.3 2.3 1.1
Including interest on deposits......................................... 1.4 1.4 1.5 1.5 1.4 1.0
</TABLE>
For purposes of computing the consolidated ratios, earnings represent net
income of the Corporation plus applicable income taxes and fixed charges, less
capitalized interest and the equity in undistributed earnings of unconsolidated
subsidiaries and associated companies. Fixed charges represent interest expense
(exclusive of interest on deposits in one case and inclusive of such interest in
the other), capitalized interest, amortization of debt discount and appropriate
issuance costs and one-third (the amount deemed to represent an appropriate
interest factor) of net rent expense under all lease commitments. Preferred
stock dividend requirements represent dividend requirements on the outstanding
preferred stock adjusted to reflect the pre-tax earnings that would be required
to cover such dividend requirements.
ALT-6
<PAGE>
[ALTERNATE PAGE -- EQUITY]
PLAN OF DISTRIBUTION
This Prospectus and related Prospectus Supplements are to be used by
NationsBanc Capital Markets, Inc. ("NCMI"), a broker-dealer and a direct
wholly-owned subsidiary of NationsBank, in connection with offers and sales of
the Securities in secondary market transactions at negotiated prices relating to
prevailing prices at the time of sale or otherwise. NCMI may act as principal or
agent in such transactions. The participation of NCMI in the offer and sale of
the Securities complies with the requirements of Section 2720 of the Conduct
Rules of the National Association of Securities Dealers, Inc. (the "NASD")
regarding underwriting of securities of an affiliate. NCMI will not execute a
transaction in the Securities in a discretionary account without the prior
written specific approval of NCMI's customer. NCMI has no obligation to make a
market in the Securities and may discontinue its market-making activities at any
time without notice, at its sole discretion. Furthermore, NCMI may be required
to discontinue its market-making activities during periods when the Corporation
is involved in a distribution of certain of its securities or when NCMI, by
virtue of its affiliation with the Corporation, is aware of material non-public
information relating to the Corporation. In such instance, NCMI would not be
able to recommence its market-making activities until such distribution has been
completed or such information has become publicly available. It is not possible
to determine the impact, if any, that any such discontinuance may have on the
market for the Securities. While other broker-dealers may make a market in the
Securities from time to time, there can be no assurance that any other
broker-dealer will do so at any time when NCMI discontinues its market-making
activities.
DESCRIPTION OF PREFERRED STOCK
GENERAL
NationsBank has authorized 45,000,000 shares of preferred stock and may
issue such preferred stock in one or more series, each with such preferences,
limitations, designations, conversion rights, voting rights, dividend rights,
voluntary and involuntary liquidation rights and other rights as it may
determine. NationsBank has designated 3,000,000 shares of ESOP Convertible
Preferred Stock, Series C (the "ESOP Preferred Stock"), of which 2,445,143
shares were issued and outstanding as of June 30, 1996.
The ability of NationsBank to pay dividends with respect to its preferred
stock or other capital stock may be affected by the ability of the Banks to pay
dividends. The ability of the Banks, as well as of the Corporation, to pay
dividends in the future currently is, and could be further, influenced by bank
regulatory requirements and capital guidelines. See "NATIONSBANK
CORPORATION -- Supervision and Regulation."
THE PREFERRED STOCK
GENERAL. The Preferred Stock shall have the general dividend, voting and
liquidation preference rights set forth below unless otherwise provided in the
Prospectus Supplement relating to a particular series of Preferred Stock offered
thereby. Reference is made to the applicable Prospectus Supplement for specific
terms, including, where applicable: (i) the title and stated value of such
Preferred Stock; (ii) the aggregate number of shares of Preferred Stock so
offered; (iii) the price at which such Preferred Stock will be issued; (iv) the
dividend rates or method of calculation, the dividend period and the dates on
which dividends shall be payable; (v) whether any such dividends will be
cumulative or noncumulative, and if cumulative, the date from which dividends
shall commence to cumulate; (vi) the dates on which the Preferred Stock will be
subject to redemption at the option of the Corporation, if applicable, and any
related redemption terms; (vii) any mandatory redemption or sinking fund
provisions; (viii) any rights on the part of the holder or NationsBank to
convert the Preferred Stock into shares of Common Stock; and (ix) any additional
voting, liquidation, preemptive and other rights, preferences, privileges,
limitations and restrictions. The description of certain provisions of the
Preferred Stock set forth below and in the applicable Prospectus Supplement does
not purport to be complete and is subject to and qualified in its entirety by
reference to the Articles of Amendment to the Articles of Incorporation of the
Corporation relating to the particular series of Preferred Stock, which will be
filed with the Commission at or prior to the time of sale of such Preferred
Stock.
NationsBank may, at its option, elect to offer Depositary Shares evidenced
by depositary receipts (the "Depositary Receipts"), each representing a
fractional interest (to be specified in the Prospectus Supplement relating to
the particular series of Preferred Stock) in a share of a particular series of
the Preferred Stock issued and deposited with a Depositary (as defined below).
See "DESCRIPTION OF DEPOSITARY SHARES" below.
ALT-7
<PAGE>
[ALTERNATE PAGE -- EQUITY]
The Preferred Stock ranks senior to the Common Stock as to the payment of
dividends and the distribution of assets on liquidation, dissolution and winding
up of the Corporation. The dividend and liquidation preference rights of the
Preferred Stock relative to the ESOP Preferred Stock or any future series of
preferred stock of the Corporation shall be set forth in the Prospectus
Supplement relating to the particular series of Preferred Stock offered thereby.
When issued in accordance with the terms of the Prospectus and the
applicable Prospectus Supplement, the Preferred Stock will be validly issued,
fully paid and nonassessable.
DIVIDENDS. When and as declared by the Board of Directors of the
Corporation, holders of the Preferred Stock will be entitled to receive
quarterly cash dividends at such rates and on such dates as will be set forth in
the applicable Prospectus Supplement. All dividends shall be paid out of funds
of NationsBank legally available for such purpose. Except as otherwise set forth
in the applicable Prospectus Supplement, no dividends shall be paid on other
shares of the Corporation, nor shall any shares of other capital stock of the
Corporation be redeemed, repurchased or otherwise acquired for any consideration
(or any moneys be paid into a sinking fund for the redemption of shares of such
stock) by the Corporation, if dividends on any series of Preferred Stock are in
arrears.
VOTING. Except as required by applicable law or as otherwise set forth in
the applicable Prospectus Supplement, the holders of Preferred Stock shall have
no voting rights with regard to matters submitted to a general vote of the
shareholders of the Corporation.
LIQUIDATION PREFERENCE. In the event of any liquidation, dissolution or
winding up of the Corporation, either voluntary or involuntary, the holders of
any series of Preferred Stock shall be entitled to receive, by reason of their
ownership thereof, after distributions to holders of any series or class of
capital stock of the Corporation as may be set forth in the applicable
Prospectus Supplement, an amount equal to the appropriate stated or liquidation
value of the shares of such series (as set forth in the applicable Prospectus
Supplement), plus an amount equal to accrued and unpaid dividends, if any,
through the date of such payment. If upon the occurrence of such event, the
assets and funds to be thus distributed among the holders of such Preferred
Stock shall be insufficient to permit the payment to such holders of the full
amount due, then the holders of such Preferred Stock shall share ratably in any
distribution of assets of the Corporation in proportion to the respective
amounts which otherwise would be payable with respect to the shares held by them
upon such distribution if all amounts payable on or with respect to such shares
were paid in full.
ESOP PREFERRED STOCK
THE FOLLOWING SUMMARY OF THE ESOP PREFERRED STOCK IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO THE DESCRIPTION OF SUCH SERIES OF PREFERRED STOCK
CONTAINED IN THE CORPORATION'S RESTATED ARTICLES OF INCORPORATION, AS AMENDED.
The ESOP Preferred Stock was first issued in the transaction by which
NationsBank was formed from the merger of NCNB Corporation and C&S/Sovran
Corporation in 1991 upon the conversion of shares of ESOP Convertible Preferred
Stock, Series C of C&S/Sovran Corporation. All shares are held by the trustee
under the NationsBank Corporation Retirement Savings Plan (the "ESOP").
Shares of ESOP Preferred Stock have no preemptive or preferential rights to
purchase or subscribe for shares of NationsBank capital stock of any class and
are not subject to any sinking fund or other obligation of NationsBank to
repurchase or retire the series, except as discussed below.
Each share of ESOP Preferred Stock is entitled to an annual dividend,
subject to certain adjustments, of $3.30 per share, payable semiannually. Unpaid
dividends accumulate as of the date on which they first became payable, without
interest. So long as any shares of ESOP Preferred Stock are outstanding, no
dividend may be declared, paid or set apart for payment on any other series of
stock ranking on a parity with the ESOP Preferred Stock as to dividends, unless
like dividends have been declared and paid, or set apart for payment, on the
ESOP Preferred Stock for all dividend payment periods ending on or before the
dividend payment date for such parity stock, ratably in proportion to their
respective amounts of accumulated and unpaid dividends. NationsBank generally
may not declare, pay or set apart for payment any dividends (except for, among
other things, dividends payable solely in shares of stock ranking junior to the
ESOP Preferred Stock as to dividends
ALT-8
<PAGE>
[ALTERNATE PAGE -- EQUITY]
or upon liquidation) on, make any other distribution on, or make payment on
account of the purchase, redemption or other retirement of, any other class or
series of NationsBank capital stock ranking junior to the ESOP Preferred Stock
as to dividends or upon liquidation, until full cumulative dividends on the ESOP
Preferred Stock have been declared and paid or set apart for payment when due.
The holder of the ESOP Preferred Stock is entitled to vote on all matters
submitted to a vote of the holders of Common Stock and votes together with the
holders of Common Stock as one class. Except as otherwise required by applicable
law, the holder of the ESOP Preferred Stock has no special voting rights. To the
extent that the holder of such shares is entitled to vote, each share is
entitled to the number of votes equal to the number of shares of Common Stock
into which such share of ESOP Preferred Stock could be converted on the record
date for determining the shareholders entitled to vote, rounded to the nearest
whole vote.
Shares of the ESOP Preferred Stock initially are convertible into Common
Stock at a conversion rate equal to 0.84 shares of Common Stock per share of
ESOP Preferred Stock and a conversion price of $42.50 per 0.84 shares of Common
Stock, subject to certain customary anti-dilution adjustments.
In the event of any voluntary or involuntary dissolution, liquidation or
winding-up of NationsBank, the holder of the ESOP Preferred Stock will be
entitled to receive out of the assets of NationsBank available for distribution
to shareholders, subject to the rights of the holders of any Preferred Stock
ranking senior to or on a parity with the ESOP Preferred Stock as to
distributions upon liquidation, dissolution or winding-up but before any amount
will be paid or distributed among the holders of Common Stock or any other
shares ranking junior to the ESOP Preferred Stock as to such distributions,
liquidating distributions of $42.50 per share plus all accrued and unpaid
dividends thereon to the date fixed for distribution. If, upon any voluntary or
involuntary dissolution, liquidation or winding-up of NationsBank, the amounts
payable with respect to the ESOP Preferred Stock and any other stock ranking on
a parity therewith as to any such distribution are not paid in full, the holder
of the ESOP Preferred Stock and such other stock will share ratably in any
distribution of assets in proportion to the full respective preferential amounts
to which they are entitled. After payment of the full amount of the liquidating
distribution to which it is entitled, the holder of the ESOP Preferred Stock
will not be entitled to any further distribution of assets by NationsBank.
Neither a merger or consolidation of NationsBank with or into any other
corporation, nor a merger or consolidation of any other corporation with or into
NationsBank nor a sale, transfer or lease of all or any portion of NationsBank's
assets, will be deemed to be a dissolution, liquidation or winding-up of
NationsBank.
The ESOP Preferred Stock is redeemable, in whole or in part, at the option
of NationsBank, at any time. The redemption price for the shares of the ESOP
Preferred Stock, which may be paid in cash or shares of Common Stock, will
depend upon the time of redemption. Specifically, the redemption price for the
12-month period beginning July 1, 1996 is $43.49 per share; on each succeeding
July 1, the redemption price will be reduced by $.33 per share, except that on
and after July 1, 1999, the redemption price will be $42.50 per share. In each
case, the redemption price also must include all accrued and unpaid dividends to
the date of redemption. To the extent that the ESOP Preferred Stock is treated
as Tier 1 capital for bank regulatory purposes, the approval of the Federal
Reserve Board may be required for redemption of the ESOP Preferred Stock.
NationsBank is required to redeem shares of the ESOP Preferred Stock at the
option of the holder of such shares to the extent necessary either to provide
for distributions required to be made under the ESOP or to make payments of
principal, interest or premium due and payable on any indebtedness incurred by
the holder of the shares. The redemption price in such case will be the greater
of $42.50 per share plus accrued and unpaid dividends to the date of redemption
or the fair market value of the aggregate number of shares of Common Stock into
which a share of ESOP Preferred Stock then is convertible.
DESCRIPTION OF DEPOSITARY SHARES
GENERAL
NationsBank may, at its option, elect to offer fractional interests in the
Preferred Stock, rather than whole shares of such securities. In the event such
option is exercised, NationsBank will provide for the issuance by a Depositary
to the public of receipts of Depositary Shares, each of which will represent a
fractional interest in a
ALT-9
<PAGE>
[ALTERNATE PAGE -- EQUITY]
share of a particular series of the Preferred Stock, as set forth in the
Prospectus Supplement for such series of Preferred Stock.
Certain general terms and provisions of the form of Deposit Agreement (as
described below), the Depositary Shares and the form of Depositary Receipts to
which a Prospectus Supplement may relate are set forth below. The particular
terms of the Preferred Stock offered by any Prospectus Supplement and the
extent, if any, to which such general provisions may apply to the Depositary
Shares will be described in the applicable Prospectus Supplement. The
descriptions below and in any Prospectus Supplement do not purport to be
complete and are subject to and qualified in their entirety by reference to the
Deposit Agreement and the Depositary Receipts, the forms of which are
incorporated by reference in the Registration Statement of which this Prospectus
is a part and the definitive forms of which will be filed with the Commission at
the time of sale of such Depositary Shares.
The shares of any series of the Preferred Stock underlying the Depositary
Shares will be deposited under a separate Deposit Agreement (the "Deposit
Agreement") between NationsBank and a bank or trust company selected by
NationsBank having its principal office in the United States and having a
combined capital and surplus of at least $5,000,000 (the "Depositary"). The
applicable Prospectus Supplement will set forth the name and address of the
Depositary. Subject to the terms of the Deposit Agreement, each owner of a
Depositary Share will be entitled, in proportion to the applicable fractional
interest in a share of Preferred Stock underlying such Depositary Share, to all
the rights and preferences of the Preferred Stock underlying such Depositary
Share (including dividend, voting, redemption, conversion and liquidation
rights).
The Depositary Shares will be evidenced by Depositary Receipts issued
pursuant to the Deposit Agreement. Depositary Receipts will be distributed to
those persons purchasing the fractional shares of the related series of
Preferred Stock in accordance with the terms of the offering as described in the
applicable Prospectus Supplement.
Pending the preparation of definitive engraved Depositary Receipts, the
Depositary may, upon the written order of NationsBank, issue temporary
Depositary Receipts substantially identical to (and entitling the holders
thereof to all the rights pertaining to) the definitive Depositary Receipts but
not in definitive form. Definitive Depositary Receipts will be prepared
thereafter without unreasonable delay and temporary Depositary Receipts will be
exchangeable for definitive Depositary Receipts at the Corporation's expense.
Upon the surrender of Depositary Receipts at the office of the Depositary
(unless the Depositary Shares have been previously called for redemption) and
upon payment by the holder of the charges provided in the Deposit Agreement and
subject to the terms thereof, a holder of Depositary Shares is entitled to have
the Depositary deliver to such holder the number of whole shares of the
Preferred Stock underlying the Depositary Shares evidenced by the surrendered
Depositary Receipts; PROVIDED, HOWEVER, that the holder of such shares of
Preferred Stock will not thereafter be entitled to receive Depositary Shares
therefor. If the Depositary Receipts delivered by the holder evidence a number
of Depositary Shares in excess of the number of Depositary Shares representing
the number of whole shares of the related series of Preferred Stock to be
withdrawn, the Depositary will deliver to such holder at the same time a new
Depositary Receipt evidencing such excess number of Depositary Shares.
DIVIDENDS AND OTHER DISTRIBUTIONS
The Depositary will distribute all cash dividends or other cash
distributions received in respect of the Preferred Stock to the record holders
of Depositary Shares relating to such Preferred Stock in proportion to the
number of such Depositary Shares owned by such holders on the relevant record
date. The Depositary shall distribute only such amount, however, as can be
distributed without attributing to any holder of Depositary Shares a fraction of
one cent, and any balance not so distributed shall be added to and treated as
part of the next sum received by the Depositary for distribution to record
holders of Depositary Shares.
In the event of a distribution other than in cash, the Depositary will
distribute property received by it to the record holders of Depositary Shares
entitled thereto, unless the Depositary determines that it is not feasible to
make such distribution, in which case the Depositary, with the approval of
NationsBank, may sell such property and distribute the net proceeds from such
sale to such holders.
ALT-10
<PAGE>
[ALTERNATE PAGE -- EQUITY]
REDEMPTION OF DEPOSITARY SHARES
If a series of the Preferred Stock underlying the Depositary Shares is
subject to redemption, the Depositary Shares will be redeemed from the proceeds
received by the Depositary resulting from the redemption, in whole or in part,
of such series of the Preferred Stock held by the Depositary. The Depositary
shall mail notice of redemption not less than 30 and not more than 45 days prior
to the date fixed for redemption to the record holders of the Depositary Shares
to be so redeemed at their respective addresses appearing in the Depositary's
books. The redemption price per Depositary Share will be equal to the applicable
fraction of the redemption price per share payable with respect to such series
of the Preferred Stock. Whenever NationsBank redeems Preferred Stock held by the
Depositary, the Depositary will redeem as of the same redemption date the number
of Depositary Shares relating to the Preferred Stock so redeemed. If less than
all the Depositary Shares are to be redeemed, the Depositary Shares to be
redeemed will be selected by lot or pro rata as may be determined by the
Depositary.
After the date fixed for redemption, the Depositary Shares so called for
redemption will no longer be deemed to be outstanding and all rights of the
holder of the Depositary Shares will cease, except the right to receive the
moneys payable upon such redemption and any money or other property to which the
holders of such Depositary Shares were entitled upon such redemption upon
surrender to the Depositary of the Depositary Receipts evidencing such
Depositary Shares.
VOTING THE PREFERRED STOCK
Upon receipt of notice of any meeting at which the holders of the Preferred
Stock held by the Depositary are entitled to vote, the Depositary will mail the
information contained in such notice of meeting to the record holders of the
Depositary Shares relating to such Preferred Stock. Each record holder of such
Depositary Shares on the record date (which will be the same date as the record
date for the Preferred Stock) will be entitled to instruct the Depositary as to
the exercise of the voting rights pertaining to the amount of Preferred Stock
underlying such holder's Depositary Shares. The Depositary will endeavor,
insofar as practicable, to vote the amount of Preferred Stock underlying such
Depositary Shares in accordance with such instructions, and NationsBank will
agree to take all action which may be deemed necessary by the Depositary in
order to enable the Depositary to do so. The Depositary will abstain from voting
Preferred Stock to the extent it does not receive specific instructions from the
holders of Depositary Shares relating to such Preferred Stock.
AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT
The form of Depositary Receipt evidencing the Depositary Shares and any
provision of the Deposit Agreement may at any time be amended by agreement
between NationsBank and the Depositary. However, any amendment which materially
and adversely alters the rights of the existing holders of Depositary Shares
will not be effective unless such amendment has been approved by the record
holders of at least a majority in interest of the Depositary Shares then
outstanding. A Deposit Agreement may be terminated by NationsBank or the
Depositary only if (i) all outstanding Depositary Shares relating thereto have
been redeemed or (ii) there has been a final distribution in respect of the
Preferred Stock underlying such Depositary Shares in connection with any
liquidation, dissolution or winding up of NationsBank.
CHARGES OF DEPOSITARY
NationsBank will pay all transfer and other taxes and governmental charges
arising solely from the existence of the depositary arrangements. NationsBank
will pay charges of the Depositary in connection with the initial deposit of the
Preferred Stock and any redemption of the Preferred Stock. Holders of Depositary
Shares will pay other transfer and other taxes and governmental charges and such
other charges as are expressly provided in the Deposit Agreement to be for their
accounts.
MISCELLANEOUS
The Depositary will forward to the holders of Depositary Shares all reports
and communications from NationsBank which are delivered to the Depositary and
which NationsBank is required to furnish to the holders of the Preferred Stock.
ALT-11
<PAGE>
[ALTERNATE PAGE -- EQUITY]
Neither the Depositary nor NationsBank will be liable if it is prevented or
delayed by law or any circumstance beyond its control in performing its
obligations under the Deposit Agreement. The obligations of NationsBank and the
Depositary under the Deposit Agreement will be limited to performance in good
faith of their respective duties thereunder and neither entity will be obligated
to prosecute or defend any legal proceeding in respect of any Depositary Shares
or Preferred Stock unless satisfactory indemnity is furnished. Each entity may
rely upon written advice of counsel or accountants, or information provided by
persons presenting Preferred Stock for deposit, holders of Depositary Shares or
other persons believed to be competent and on documents believed to be genuine.
RESIGNATION AND REMOVAL OF DEPOSITARY
The Depositary may resign at any time by delivering to NationsBank notice
of its election to do so, and NationsBank may at any time remove the Depositary,
any such resignation or removal to take effect only upon the appointment of a
successor Depositary and its acceptance of such appointment. Such successor
Depositary must be a bank or trust company having its principal office in the
United States and having a combined capital and surplus of at least $5,000,000.
DESCRIPTION OF COMMON STOCK
THE FOLLOWING SUMMARY OF THE COMMON STOCK IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO THE DESCRIPTION OF THE COMMON STOCK INCORPORATED HEREIN BY
REFERENCE.
GENERAL
NationsBank is authorized to issue 800,000,000 shares of its Common Stock,
of which 301,082,855 shares were outstanding as of June 30, 1996. The Common
Stock is traded on the New York Stock Exchange, Inc. and on The Pacific Stock
Exchange Incorporated under the symbol "NB" and on the London Stock Exchange;
certain shares of Common Stock are also listed and traded on the Tokyo Stock
Exchange. As of June 30, 1996, 34.9 million shares were reserved for issuance in
connection with various employee and director benefit plans of NationsBank and
upon the conversion of the ESOP Preferred Stock, and 2.8 million shares were
reserved for issuance under the Corporation's Dividend Reinvestment and Stock
Purchase Plan. After taking into account the shares reserved as described above,
approximately 461.2 million authorized shares of the Common Stock remained
available for issuance for other corporate purposes as of June 30, 1996.
VOTING AND OTHER RIGHTS
The holders of the Common Stock are entitled to one vote per share, and, in
general, a majority of votes cast with respect to a matter is sufficient to take
action upon routine matters. Directors are elected by a plurality of the votes
cast, and each shareholder entitled to vote in such election shall be entitled
to vote each share of stock for as many persons as there are directors to be
elected. In elections for directors, such shareholders do not have the right to
cumulate their votes, so long as the Corporation has a class of shares
registered under Section 12 of the 1934 Act (unless action is taken to provide
otherwise by charter amendment, which action management does not currently
intend to propose). In general, (i) amendments to the Corporation's Restated
Articles of Incorporation must be approved by each voting group entitled to vote
separately thereon by a majority of the votes cast by that voting group, unless
the amendment creates dissenters' rights for a particular voting group, in which
case such amendment must be approved by a majority of the votes entitled to be
cast by such voting group; (ii) a merger or share exchange required to be
approved by shareholders must be approved by each voting group entitled to vote
separately thereon by a majority of the votes entitled to be cast by that voting
group; and (iii) the dissolution of the Corporation, or the sale of all or
substantially all of the property of the Corporation other than in the usual and
regular course of business, must be approved by a majority of all votes entitled
to be cast thereon.
In the event of liquidation of the Corporation, holders of the Common Stock
would be entitled to receive pro rata any assets legally available for
distribution to shareholders with respect to shares held by them, subject to any
prior rights of any preferred stock then outstanding. See "DESCRIPTION OF
PREFERRED STOCK" above.
The Common Stock does not have any preemptive rights, redemption
privileges, sinking fund privileges or conversion rights. All the outstanding
shares of the Common Stock are, and upon proper conversion of any
ALT-12
<PAGE>
[ALTERNATE PAGE -- EQUITY]
Preferred Stock all of the shares of Common Stock into which such shares are
converted will be, validly issued, fully paid and nonassessable.
Chase Mellon Shareholder Services acts as transfer agent and registrar for
the Common Stock.
DISTRIBUTIONS
The holders of the Common Stock are entitled to receive such dividends or
distributions as the Board of Directors of the Corporation may declare out of
funds legally available for such payments. The payment of distributions by
NationsBank is subject to the restrictions of North Carolina law applicable to
the declaration of distributions by a business corporation. A corporation
generally may not authorize and make distributions if, after giving effect
thereto, it would be unable to meet its debts as they become due in the usual
course of business or if the corporation's total assets would be less than the
sum of its total liabilities plus the amount that would be needed, if it were to
be dissolved at the time of distribution, to satisfy claims upon dissolution of
shareholders who have preferential rights superior to the rights of the holders
of its common stock. In addition, the payment of distributions to shareholders
is subject to any prior rights of outstanding preferred stock, including the
ESOP Preferred Stock and any other series of Preferred Stock when and if issued
from time to time. See "DESCRIPTION OF PREFERRED STOCK." Share dividends, if any
are declared, may be paid from NationsBank's authorized but unissued shares.
The ability of NationsBank to pay dividends may be affected by the ability
of the Banks to pay dividends. The ability of the Banks, as well as of the
Corporation, to pay dividends in the future currently is, and could be further,
influenced by bank regulatory requirements and capital guidelines. See
"NATIONSBANK CORPORATION -- Supervision and Regulation."
LEGAL OPINIONS
The legality of the Securities will be passed upon for the Corporation by
Smith Helms Mulliss & Moore, L.L.P., Charlotte, North Carolina, and for the
underwriters or agents by Stroock & Stroock & Lavan, New York, New York. As of
the date of this Prospectus, certain members of Smith Helms Mulliss & Moore,
L.L.P., beneficially own approximately 50,000 shares of the Corporation's Common
Stock.
EXPERTS
The consolidated financial statements of the Corporation incorporated in
this Prospectus by reference to the Corporation's Annual Report on Form 10-K for
the year ended December 31, 1995, have been so incorporated in reliance on the
report of Price Waterhouse LLP, independent accountants, given on the authority
of said firm as experts in auditing and accounting.
ALT-13
<PAGE>
[ALTERNATE PAGE -- EQUITY]
NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS IN CONNECTION WITH THE OFFERING MADE HEREBY AND, IF GIVEN OR MADE,
SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE CORPORATION OR NATIONSBANC CAPITAL MARKETS, INC. NEITHER THE
DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE AN IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF THE CORPORATION SINCE THE DATE HEREOF. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER OR SOLICITATION BY ANYONE IN ANY STATE IN WHICH SUCH OFFER
OR SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR
SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UNLAWFUL TO
MAKE SUCH OFFER OR SOLICITATION. THIS PROSPECTUS AND RELATED PROSPECTUS
SUPPLEMENTS ARE TO BE USED BY NATIONSBANC CAPITAL MARKETS, INC., A BROKER-DEALER
AND A DIRECT WHOLLY-OWNED SUBSIDIARY OF THE CORPORATION, IN CONNECTION WITH
OFFERS AND SALES RELATED TO SECONDARY MARKET TRANSACTIONS.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
PROSPECTUS
Incorporation of Certain Documents by
Reference.................................... 2
Available Information.......................... 2
NationsBank Corporation........................ 3
Use of Proceeds................................ 6
Ratios of Earnings to Combined Fixed Charges
and Preferred Stock Dividends................ 6
Plan of Distribution........................... 7
Description of Preferred Stock................. 7
Description of Depositary Shares............... 9
Description of Common Stock.................... 12
Legal Opinions................................. 13
Experts........................................ 13
</TABLE>
$3,000,000,000
NATIONSBANK(Register Mark)
PREFERRED STOCK
DEPOSITARY SHARES
COMMON STOCK
PROSPECTUS
NATIONSBANC CAPITAL MARKETS, INC.
, 1996
<PAGE>
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The estimated expenses, other than underwriting or broker-dealer fees,
discounts and commissions, in connection with the offering are as follows:
<TABLE>
<S> <C>
Securities Act Registration Fee..................... $ 909,091
Printing and Engraving Expenses..................... 150,000
Legal Fees and Expenses............................. 350,000
Accounting Fees and Expenses........................ 150,000
Blue Sky Fees and Expenses.......................... 40,000
Indenture Trustee Expenses.......................... 175,000
Rating Agency Fees and Expenses..................... 600,000
Listing Fees........................................ 50,000
Miscellaneous....................................... 25,909
$2,450,000
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
There are no provisions in the Registrant's Restated Articles of
Incorporation, and no contracts between the Registrant and its directors and
officers, relating to indemnification. The Registrant's Restated Articles of
Incorporation prevent the recovery by the Registrant of monetary damages against
its directors. However, in accordance with the provisions of the North Carolina
Business Corporation Act (the "Act"), the Registrant's Amended and Restated
Bylaws provide that, in addition to the indemnification of directors and
officers otherwise provided by the Act, the Registrant shall, under certain
circumstances, indemnify its directors, executive officers and certain other
designated officers against any and all liability and litigation expense,
including reasonable attorneys' fees, arising out of their status or activities
as directors and officers, except for liability or litigation expense incurred
on account of activities that were at the time known or reasonably should have
been known by such director or officer to be clearly in conflict with the best
interests of the Registrant. Pursuant to such bylaw and as authorized by
statute, the Registrant maintains insurance on behalf of its directors and
officers against liability asserted against such persons in such capacity
whether or not such directors or officers have the right to indemnification
pursuant to the bylaw or otherwise.
In addition to the above-described provisions, Sections 55-8-50 through
55-8-58 of the Act contain provisions prescribing the extent to which directors
and officers shall or may be indemnified. Section 55-8-51 of the Act permits a
corporation, with certain exceptions, to indemnify a current or former director
against liability if (i) he conducted himself in good faith, (ii) he reasonably
believed (x) that his conduct in his official capacity with the corporation was
in its best interests and (y) in all other cases his conduct was at least not
opposed to the corporation's best interests, and (iii) in the case of any
criminal proceeding, he had no reasonable cause to believe his conduct was
unlawful. A corporation may not indemnify a current or former director in
connection with a proceeding by or in the right of the corporation in which the
director was adjudged liable to the corporation or in connection with a
proceeding charging improper personal benefit to him in which he was adjudged
liable on such basis. The above standard of conduct is determined by the Board
of Directors or a committee thereof or special legal counsel or the shareholders
as prescribed in Section 55-8-55.
Sections 55-8-52 and 55-8-56 of the Act require a corporation to indemnify
a director or officer in the defense of any proceeding to which he was a party
because of his capacity as a director or officer against reasonable expenses
when he is wholly successful in his defense, unless the articles of
incorporation provide otherwise. Upon application, the court may order
indemnification of the director or officer if he is adjudged fairly and
reasonably so entitled under Section 55-8-54. Section 55-8-56 allows a
corporation to indemnify and advance expenses to an officer, employee or agent
who is not a director to the same extent as a director or as otherwise set forth
in the Corporation's articles of incorporation or bylaws or by resolution of the
Board of Directors.
In addition, Section 55-8-57 permits a corporation to provide for
indemnification of directors, officers, employees or agents, in its articles of
incorporation or bylaws or by contract or resolution, against liability in
various proceedings and to purchase and maintain insurance policies on behalf of
these individuals.
THE FOREGOING IS ONLY A GENERAL SUMMARY OF CERTAIN ASPECTS OF NORTH
CAROLINA LAW DEALING WITH INDEMNIFICATION OF DIRECTORS AND OFFICERS AND DOES NOT
PURPORT TO BE COMPLETE. IT IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE
RELEVANT STATUTES
II-1
<PAGE>
WHICH CONTAIN DETAILED SPECIFIC PROVISIONS REGARDING THE CIRCUMSTANCES UNDER
WHICH AND THE PERSON FOR WHOSE BENEFIT INDEMNIFICATION SHALL OR MAY BE MADE AND
ACCORDINGLY ARE INCORPORATED HEREIN BY REFERENCE.
In addition, certain sections of each of the forms of Underwriting or
Distribution Agreements filed as Exhibits hereto provide for indemnification of
the Registrant and its directors and officers by the underwriters or agents
against certain liabilities, including certain liabilities under the 1933 Act.
From time to time similar provisions have been contained in other agreements
relating to other securities of the Registrant.
ITEM 16. LIST OF EXHIBITS.
<TABLE>
<C> <S>
1.1 Form of Underwriting Agreement for Debt Securities
1.2 Form of Underwriting Agreement for Preferred Stock
1.3 Form of Underwriting Agreement for Common Stock
1.4 Form of Distribution Agreement for Medium-Term Notes, incorporated herein by reference to
Exhibit 1.4 of the Registrant's Registration Statement on Form S-3 (Registration No. 333-7229)
4.1 Indenture dated as of January 1, 1995 between NationsBank Corporation and BankAmerica National
Trust Company, as trustee, incorporated herein by reference to Exhibit 4.1 of the Registrant's
Registration Statement on Form S-3 (Registration No. 33-57533)
4.2 Successor Trustee Agreement effective December 15, 1995, between NationsBank Corporation and
First Trust Bank of New York, as successor trustee to BankAmerica National Trust Company,
incorporated herein by reference to Exhibit 4.2 of the Registrant's Registration Statement on
Form S-3 (Registration No. 333-7229)
4.3 Form of Senior Registered Note
4.4 Form of Senior Medium-Term Note (Fixed Rate)
4.5 Form of Senior Medium-Term Note (Floating Rate)
4.6 Indenture dated as of January 1, 1995 between NationsBank Corporation and The Bank of New York,
as trustee, incorporated herein by reference to Exhibit 4.5 of the Registrant's Registration
Statement on Form S-3 (Registration No. 33-57533)
4.7 Form of Subordinated Registered Note
4.8 Form of Subordinated Medium-Term Note (Fixed Rate)
4.9 Form of Subordinated Medium-Term Note (Floating Rate)
4.10 Form of Certificate for Preferred Stock, incorporated herein by reference to Exhibit 4.6 of the
Registrant's Registration Statement on Form S-3 (Registration No. 33-54784)
4.11 Form of Deposit Agreement, incorporated herein by reference to Exhibit 4.4 of the Registrant's
Registration Statement on Form S-3 (Registration No. 33-54784)
4.12 Form of Depositary Receipt, incorporated herein by reference to Exhibit 4.5 of the Registrant's
Registration Statement on Form S-3 (Registration No. 33-54784)
5.1 Opinion of Smith Helms Mulliss & Moore, L.L.P. regarding legality of securities being registered
12.1 Calculation of Ratios of Earnings to Fixed Charges, incorporated herein by reference to Exhibit
12(a) to the Registrant's Quarterly Report on Form 10-Q for the quarter ended June 30, 1996
(File No. 1-6523)
12.2 Calculation of Ratios of Earnings to Fixed Charges and Preferred Dividends, incorporated herein
by reference to Exhibit 12(b) to the Registrant's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1996 (File No. 1-6523)
23.1 Consent of Smith Helms Mulliss & Moore, L.L.P. (included in Exhibit 5.1)
23.2 Consent of Price Waterhouse LLP
23.3 Consent of Ernst & Young LLP
24.1 Power of Attorney
24.2 Certified Resolutions
25.1 Statement of Eligibility of Senior Trustee on Form T-1
25.2 Statement of Eligibility of Subordinated Trustee on Form T-1
99.1 Provisions of the North Carolina Business Corporation Act, as amended, relating to indemni-
fication of directors and officers, incorporated herein by reference to Exhibit 99.1 of the
Registrant's Registration Statement on Form S-3 (Registration No. 33-63097)
</TABLE>
II-2
<PAGE>
ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to the Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the 1933 Act;
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the Registration Statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the Registration Statement.
Notwithstanding the foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration Fee"
table in the effective Registration Statement.
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or any
material change to such information in the Registration Statement.
PROVIDED, HOWEVER, that paragraphs (1)(i) and (1)(ii) do not apply if the
Registration Statement is on Form S-3 or Form S-8 and the information required
to be included in a post-effective amendment by those paragraphs is contained in
periodic reports filed by the Registrant pursuant to Section 13 or Section 15(d)
of the 1934 Act that are incorporated by reference in the Registration
Statement.
(2) That, for the purpose of determining any liability under the 1933 Act,
each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the 1933 Act, each filing of the Registrant's
annual report pursuant to Section 13(a) or Section 15(d) of the 1934 Act that is
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
Insofar as indemnification for liabilities arising under the 1933 Act may
be permitted to directors, officers and controlling persons of the Registrant
pursuant to the foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Commission such indemnification is against
public policy as expressed in the 1933 Act and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other than
the payment by the Registrant of expenses incurred or paid by a director,
officer or controlling person of the Registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the Registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the 1933 Act
and will be governed by the final adjudication of such issue.
The Registrant hereby undertakes (1) to use its best efforts to distribute
prior to the opening of bids, to prospective bidders, underwriters, and dealers,
a reasonable number of copies of a prospectus which at that time meets the
requirements of Section 10(a) of the 1933 Act, and relating to the securities
offered at competitive bidding, as contained in the Registration Statement,
together with any supplements thereto, and (2) to file an amendment to the
Registration Statement reflecting the results of bidding, the terms of the
reoffering and related matters to the extent required by the applicable form,
not later than the first use, authorized by the Registrant after the opening of
bids, of a prospectus relating to the securities offered at competitive bidding,
unless no further public offering of such securities by the Registrant and no
reoffering of such securities by the purchasers is proposed to be made.
The Registrant hereby undertakes to file an application for the purpose of
determining the eligibility of the trustee to act under subsection (a) of
Section 310 of the Trust Indenture Act of 1939, as amended (the "Act"), in
accordance with the rules and regulations prescribed by the Commission under
Section 305(b)(2) of the Act.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Charlotte, North Carolina, on October 9, 1996.
NATIONSBANK CORPORATION
(REGISTRANT)
By: *HUGH L. MCCOLL, JR.
HUGH L. MCCOLL, JR.
CHAIRMAN OF THE BOARD AND
CHIEF EXECUTIVE OFFICER
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<S> <C> <C>
*HUGH L. MCCOLL, JR. Chairman of the Board, Chief Executive October 9, 1996
Officer and Director (Principal
(HUGH L. MCCOLL, JR.) Executive Officer)
Vice Chairman and Chief Financial Officer October 9, 1996
/s/ JAMES H. HANCE, JR. (Principal Financial Officer)
(JAMES H. HANCE, JR.)
Executive Vice President October 9, 1996
/s/ MARC D. OKEN and Chief Accounting Officer
(MARC D. OKEN) (Principal Accounting
Officer)
*RONALD W. ALLEN Director October 9, 1996
(RONALD W. ALLEN)
*RAY C. ANDERSON Director October 9, 1996
(RAY C. ANDERSON)
*WILLIAM M. BARNHARDT Director October 9, 1996
(WILLIAM M. BARNHARDT)
Director , 1996
(THOMAS E. CAPPS)
*CHARLES W. COKER Director October 9, 1996
(CHARLES W. COKER)
*THOMAS G. COUSINS Director October 9, 1996
(THOMAS G. COUSINS)
*ALAN T. DICKSON Director October 9, 1996
(ALAN T. DICKSON)
</TABLE>
II-4
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<S> <C> <C>
Director , 1996
(W. FRANK DOWD, JR.)
*PAUL FULTON Director October 9, 1996
(PAUL FULTON)
*TIMOTHY L. GUZZLE Director October 9, 1996
(TIMOTHY L. GUZZLE)
*W. W. JOHNSON Director October 9, 1996
(W. W. JOHNSON)
*JOHN J. MURPHY Director October 9, 1996
(JOHN J. MURPHY)
*JOHN C. SLANE Director October 9, 1996
(JOHN C. SLANE)
Director October , 1996
(O. TEMPLE SLOAN, JR.)
*JOHN W. SNOW Director October 9, 1996
(JOHN W. SNOW)
*MEREDITH R. SPANGLER Director October 9, 1996
(MEREDITH R. SPANGLER)
*ROBERT H. SPILMAN Director October 9, 1996
(ROBERT H. SPILMAN)
*RONALD TOWNSEND Director October 9, 1996
(RONALD TOWNSEND)
*E. CRAIG WALL, JR. Director October 9, 1996
(E. CRAIG WALL, JR.)
*JACKIE M. WARD Director October 9, 1996
(JACKIE M. WARD)
*VIRGIL R. WILLIAMS Director October 9, 1996
(VIRGIL R. WILLIAMS)
*By: /s/ CHARLES M. BERGER
CHARLES M. BERGER, ATTORNEY-IN-FACT
</TABLE>
II-5
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
SEQUENTIAL
EXHIBIT NO. DESCRIPTION PAGE NO.
<C> <S> <C>
1.1 Form of Underwriting Agreement for Debt Securities
1.2 Form of Underwriting Agreement for Preferred Stock
1.3 Form of Underwriting Agreement for Common Stock
1.4 Form of Distribution Agreement for Medium-Term Notes, incorporated
herein by reference to Exhibit 1.4 of the Registrant's Registration
Statement on Form S-3 (Registration No. 333-7229)
4.1 Indenture dated as of January 1, 1995 between NationsBank Corporation
and BankAmerica National Trust Company, as trustee, incorporated herein
by reference to Exhibit 4.1 of the Registrant's Registration Statement
on Form S-3 (Registration No. 33-57533)
4.2 Successor Trustee Agreement effective December 15, 1995, between
NationsBank Corporation and First Trust Bank of New York, as successor
trustee to BankAmerica National Trust Company, incorporated herein by
reference to Exhibit 4.2 of the Registrant's Registration Statement on
Form S-3 (Registration No. 333-7229)
4.3 Form of Senior Registered Note
4.4 Form of Senior Medium-Term Note (Fixed Rate)
4.5 Form of Senior Medium-Term Note (Floating Rate)
4.6 Indenture dated as of January 1, 1995 between NationsBank Corporation
and The Bank of New York, as trustee, incorporated herein by reference
to Exhibit 4.5 of the Registrant's Registration Statement on Form S-3
(Registration No. 33-57533)
4.7 Form of Subordinated Registered Note
4.8 Form of Subordinated Medium-Term Note (Fixed Rate)
4.9 Form of Subordinated Medium-Term Note (Floating Rate)
4.10 Form of Certificate for Preferred Stock, incorporated herein by
reference to Exhibit 4.6 of the Registrant's Registration Statement on
Form S-3 (Registration No. 33-54784)
4.11 Form of Deposit Agreement, incorporated herein by reference to Exhibit
4.4 of the Registrant's Registration Statement on Form S-3 (Registration
No. 33-54784)
4.12 Form of Depositary Receipt, incorporated herein by reference to Exhibit
4.5 of the Registrant's Registration Statement on Form S-3 (Registration
No. 33-54784)
5.1 Opinion of Smith Helms Mulliss & Moore, L.L.P. regarding legality of
securities being registered
12.1 Calculation of Ratios of Earnings to Fixed Charges, incorporated herein
by reference to Exhibit 12(a) to the Registrant's Quarterly Report on
Form 10-Q for the quarter ended June 30, 1996 (File
No. 1-6523)
12.2 Calculation of Ratios of Earnings to Fixed Charges and Preferred
Dividends, incorporated herein by reference to Exhibit 12(b) to the
Registrant's Quarterly Report on Form 10-Q for the quarter ended June
30, 1996 (File No. 1-6523)
23.1 Consent of Smith Helms Mulliss & Moore, L.L.P. (included in Exhibit 5.1)
23.2 Consent of Price Waterhouse LLP
23.3 Consent of Ernst & Young LLP
24.1 Power of Attorney
24.2 Certified Resolutions
25.1 Statement of Eligibility of Senior Trustee on Form T-1
25.2 Statement of Eligibility of Subordinated Trustee on Form T-1
99.1 Provisions of the North Carolina Business Corporation Act, as amended,
relating to indemnification of directors and officers, incorporated
herein by reference to Exhibit 99.1 of the Registrant's Registration
Statement on Form S-3 (Registration No. 33-63097)
</TABLE>
<PAGE>
[Debt Securities]
NATIONSBANK CORPORATION
UNDERWRITING AGREEMENT
New York, New York
____________, 199_
To the Representatives
named in Schedule I
hereto of the Underwriters
named in Schedule II hereto
Dear Sirs:
NationsBank Corporation, a North Carolina corporation (the "Company"),
proposes to sell to the underwriters named in Schedule II hereto (the
"Underwriters"), for whom you are acting as representatives (the
"Representatives"), the principal amount of its securities identified in
Schedule I hereto (the "Securities"), to be issued under an indenture (the
"Indenture") dated as of ____________ between the Company and ____________, as
trustee (the "Trustee"). If the firm or firms listed in Schedule II hereto
include only the firm or firms listed in Schedule I hereto, then the terms
"Underwriters" and "Representatives", as used herein, each shall be deemed to
refer to such firm or firms.
1. Representations and Warranties. The Company represents
and warrants to, and agrees with, each Underwriter that:
(a) The Company meets the requirements for use of Form S-3
under the Securities Act of 1933, as amended (the "Act"), and has filed
with the Securities and Exchange Commission (the "Commission") a
registration statement on such Form (the file number of which is set
forth in Schedule I hereto), which has become effective, for the
registration under the Act of the Securities. Such registration
statement, as amended at the date of this Agreement, meets the
requirements set forth in Rule 415(a)(1) under the Act and complies in
all other material respects with said Rule. The Company proposes to
file with the Commission pursuant to Rule 424 or Rule 434 under the Act
a supplement to the form of prospectus included in such registration
statement relating to the Securities and the plan of distribution
thereof and has previously advised you of all further information
(financial and other) with respect to the Company to be set forth
therein. Such registration
<PAGE>
statement, including the exhibits thereto, as amended at the date of
this Agreement, is hereinafter called the "Registration Statement";
such prospectus in the form in which it appears in the Registration
Statement is hereinafter called the "Basic Prospectus"; and such
supplemented form of prospectus, in the form in which it shall be filed
with the Commission pursuant to Rule 424 or Rule 434 (including the
Basic Prospectus as so supplemented) is hereinafter called the "Final
Prospectus." Any preliminary form of the Final Prospectus which has
heretofore been filed pursuant to Rule 424 hereinafter is called the
"Preliminary Final Prospectus." Any reference herein to the
Registration Statement, the Basic Prospectus, any Preliminary Final
Prospectus or the Final Prospectus shall be deemed to refer to and
include the documents incorporated by reference therein pursuant to
Item 12 of Form S-3 which were filed under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), on or before the date of this
Agreement, or the issue date of the Basic Prospectus, any Preliminary
Final Prospectus or the Final Prospectus, as the case may be; and any
reference herein to the terms "amend", "amendment" or "supplement" with
respect to the Registration Statement, the Basic Prospectus, and the
Preliminary Final Prospectus or the Final Prospectus shall be deemed to
refer to and include the filing of any document under the Exchange Act
after the date of this Agreement, or the issue date of the Basic
Prospectus, any Preliminary Final Prospectus or the Final Prospectus,
as the case may be, and deemed to be incorporated therein by reference.
(b) As of the date hereof, when the Final Prospectus is first
filed pursuant to Rule 424 or Rule 434 under the Act, when, prior to
the Closing Date (as hereinafter defined), any amendment to the
Registration Statement becomes effective (including the filing of any
document incorporated by reference in the Registration Statement), when
any supplement to the Final Prospectus is filed with the Commission and
at the Closing Date (as hereinafter defined), (i) the Registration
Statement as amended as of any such time, and the Final Prospectus, as
amended or supplemented as of any such time, and the Indenture will
comply in all material respects with the applicable requirements of the
Act, the Trust Indenture Act of 1939 (the "Trust Indenture Act") and
the Exchange Act and the respective rules thereunder, (ii) the
Registration Statement, as amended as of any such time, will not
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to
make the statements therein not misleading, and (iii) the Final
Prospectus, as amended or supplemented as of any such time, will not
contain any untrue statement of a material fact or omit to state any
material fact required to
- 2 -
<PAGE>
be stated therein or necessary in order to make the statements therein,
in light of the circumstances under which they were made, not
misleading; provided, however, that the Company makes no
representations or warranties as to (A) that part of the Registration
Statement which shall constitute the Statement of Eligibility and
Qualification of the Trustee (Form T-1) under the Trust Indenture Act
of the Trustee or (B) the information contained in or omitted from the
Registration Statement or the Final Prospectus or any amendment thereof
or supplement thereto in reliance upon and in conformity with
information furnished in writing to the Company by or on behalf of any
Underwriter through the Representatives specifically for use in
connection with the preparation of the Registration Statement and the
Final Prospectus.
2. Purchase and Sale. Subject to the terms and conditions and in
reliance upon the representations and warranties herein set forth, the Company
agrees to sell to each Underwriter, and each Underwriter agrees, severally and
not jointly, to purchase from the Company, at the purchase price set forth in
Schedule I hereto, the principal amount of the Securities set forth opposite
such Underwriter's name in Schedule II hereto, except that, if Schedule I hereto
provides for the sale of Securities pursuant to delayed delivery arrangements,
the respective principal amounts of Securities to be purchased by the
Underwriters shall be set forth in Schedule II hereto, less the respective
amounts of Contract Securities determined as provided below. Securities to be
purchased by the Underwriters are herein sometimes called the "Underwriters'
Securities" and Securities to be purchased pursuant to Delayed Delivery
Contracts as hereinafter provided are herein called "Contract Securities."
If so provided in Schedule I hereto, the Underwriters are authorized to
solicit offers to purchase Securities from the Company pursuant to delayed
delivery contracts ("Delayed Delivery Contracts"), substantially in the form of
Schedule III hereto but with such changes therein as the Company may authorize
or approve. The Underwriters will endeavor to make such arrangements and, as
compensation therefor, the Company will pay to the Representatives, for the
account of the Underwriters, on the Closing Date, the percentage set forth in
Schedule I hereto of the principal amount of the Securities for which Delayed
Delivery Contracts are made. Delayed Delivery Contracts are to be with
institutional investors, including commercial and savings banks, insurance
companies, pension funds, investment companies and educational and charitable
institutions. The Company will make Delayed Delivery Contracts in all cases
where sales of Contract Securities arranged by the Underwriters have been
approved by the Company but, except as the Company may otherwise agree, each
such Delayed Delivery Contract must be for not less than the minimum principal
amount set forth in Schedule I hereto
- 3 -
<PAGE>
and the aggregate principal amount of Contract Securities may not exceed the
maximum aggregate principal amount set forth in Schedule I hereto. The
Underwriters will not have any responsibility in respect of the validity or
performance of Delayed Delivery Contracts. The principal amount of Securities to
be purchased by each Underwriter as set forth in Schedule II hereto shall be
reduced by an amount which shall bear the same proportion to the total principal
amount of Contract Securities as the principal amount of Securities set forth
opposite the name of such Underwriter bears to the aggregate principal amount
set forth in Schedule II hereto, except to the extent that you determine that
such reduction shall be otherwise than in such proportion and so advise the
Company in writing; provided, however, that the total principal amount of
Securities to be purchased by all Underwriters shall be the aggregate principal
amount set forth in Schedule II hereto, less the aggregate principal amount of
Contract Securities.
3. Delivery and Payment. Delivery of and payment for the Underwriters'
Securities shall be made on the date and at the time specified in Schedule I
hereto, which date and time may be postponed by agreement between the
Representatives and the Company or as provided in Section 8 hereof (such date
and time of delivery and payment for the Securities being herein called the
"Closing Date"). Delivery of the Underwriters' Securities shall be made to the
Representatives for the respective accounts of the several Underwriters against
payment by the several Underwriters through the Representatives of the purchase
price thereof in the manner set forth in Schedule I hereto. Unless otherwise
agreed, certificates for the Underwriters' Securities shall be in the form set
forth in Schedule I hereto, and such certificates may be deposited with The
Depository Trust Company ("DTC") or a custodian of DTC and registered in the
name of Cede & Co., as nominee for DTC.
4. Agreements. The Company agrees with the several
Underwriters that:
(a) Prior to the termination of the offering of the
Securities, the Company will not file any amendment of the Registration
Statement or supplement (including the Final Prospectus) to the Basic
Prospectus unless the Company has furnished you a copy for your review
prior to filing and will not file any such proposed amendment or
supplement to which you reasonably object. Subject to the foregoing
sentence, the Company will cause the Final Prospectus to be filed with
the Commission pursuant to Rule 424 or Rule 434 via the Electronic Data
Gathering, Analysis and Retrieval System. The Company will advise the
Representatives promptly (i) when the Final Prospectus shall have been
filed with the Commission pursuant to Rule 424 or Rule 434, (ii) when
any amendment to the Registration Statement relating to
- 4 -
<PAGE>
the Securities shall have become effective, (iii) of any request by the
Commission for any amendment of the Registration Statement or amendment
of or supplement to the Final Prospectus or for any additional
information, (iv) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the
institution or threatening of any proceeding for that purpose and (v)
of the receipt by the Company of any notification with respect to the
suspension of the qualification of the Securities for sale in any
jurisdiction or the initiation or threatening of any proceeding for
such purpose. The Company will use its best efforts to prevent the
issuance of any such stop order and, if issued, to obtain as soon as
possible the withdrawal thereof.
(b) If, at any time when a prospectus relating to the
Securities is required to be delivered under the Act, except with
respect to any such delivery requirement imposed upon an affiliate of
the Company in connection with any secondary market sales, any event
occurs as a result of which the Final Prospectus as then amended or
supplemented would include any untrue statement of a material fact or
omit to state any material fact necessary to make the statements
therein in light of the circumstances under which they were made not
misleading, or if it shall be necessary to amend or supplement the
Final Prospectus to comply with the Act or the Exchange Act or the
respective rules thereunder, the Company promptly will prepare and file
with the Commission, subject to the first sentence of paragraph (a) of
this Section 4, an amendment or supplement which will correct such
statement or omission or an amendment which will effect such
compliance.
(c) The Company will make generally available to its security
holders and to the Representatives as soon as practicable, but not
later than 60 days after the close of the period covered thereby, an
earnings statement (in form complying with the provisions of Rule 158
of the regulations under the Act) covering a twelve month period
beginning not later than the first day of the Company's fiscal quarter
next following the "effective date" (as defined in said Rule 158) of
the Registration Statement.
(d) The Company will furnish to the Representatives and
counsel for the Underwriters, without charge, copies of the
Registration Statement (including exhibits thereto) and each amendment
thereto which shall become effective on or prior to the Closing Date
and, so long as delivery of a prospectus by an Underwriter or dealer
may be required by the Act, as many copies of any Preliminary Final
Prospectus and the Final Prospectus and any amendments thereof and
supplements thereto as the Representatives may reasonably
- 5 -
<PAGE>
request. The Company will pay the expenses of printing all
documents relating to the offering.
(e) The Company will arrange for the qualification of the
Securities for sale under the laws of such jurisdictions as the
Representatives may reasonably designate, will maintain such
qualifications in effect so long as required for the distribution of
the Securities and will arrange for the determination of the legality
of the Securities for purchase by institutional investors; provided,
however, that the Company shall not be required to qualify to do
business in any jurisdiction where it is not now so qualified or to
take any action which would subject it to general or unlimited service
of process of any jurisdiction where it is not now so subject.
(f) Until the business day following the Closing Date, the
Company will not, without the consent of the Representatives, offer or
sell, or announce the offering of, any securities covered by the
Registration Statement or by any other registration statement filed
under the Act; provided, however, the Company may, at any time, offer
or sell or announce the offering of any securities (A) covered by a
registration statement on Form S-8 or (B) covered by a registration
statement on Form S-3 and pursuant to which the Company issues
securities for its Dividend Reinvestment Plan.
5. Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters to purchase the Underwriters'
Securities shall be subject to the accuracy of the representations and
warranties on the part of the Company contained herein as of the date hereof, as
of the date of the effectiveness of any amendment to the Registration Statement
filed prior to the Closing Date (including the filing of any document
incorporated by reference therein) and as of the Closing Date, to the accuracy
of the statements of the Company made in any certificates pursuant to the
provisions hereof, to the performance by the Company of its 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 the Final Prospectus shall have been filed or mailed
for filing with the Commission within the time period prescribed by the
Commission.
(b) The Company shall have furnished to the Representatives
the opinion of Smith Helms Mulliss & Moore, L.L.P., counsel for the
Company, dated the Closing Date, to
- 6 -
<PAGE>
the effect of paragraphs (i), (iv) and (vi) through (xii) below, and
the opinion of Paul J. Polking, General Counsel to the Company, dated
the Closing Date, to the effect of paragraphs (ii), (iii) and (v)
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 and conduct its business as described in
the Final Prospectus, and is duly registered as a bank holding
company under the Bank Holding Company Act of 1956, as
amended; 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;
(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) nonassessable, and,
except as otherwise set forth in the Final 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 knowledge of
such counsel, after due inquiry, any other security interests,
claims, liens or encumbrances;
(iv) the Securities conform in all material
respects to the description thereof contained in the
Final Prospectus;
(v) if the 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 Securities with the New York
Stock Exchange and such counsel has no reason to believe that
the Securities will not be authorized for listing, subject to
official
- 7 -
<PAGE>
notice of issuance and evidence of satisfactory
distribution;
(vi) the Indenture has been duly authorized, executed and
delivered by the Company, has been duly qualified under the
Trust Indenture Act, and constitutes a legal, valid and
binding instrument enforceable against the Company 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) and similar bank regulatory powers and to
the application of principles of public policy); and the
Securities have been duly authorized and, when executed and
authenticated in accordance with the provisions of the
Indenture and delivered to and paid for by the Underwriters
pursuant to this Agreement, in the case of the Underwriters'
Securities, or by the purchasers thereof pursuant to Delayed
Delivery Contracts, in the case of any Contract Securities,
will constitute legal, valid and binding obligations of the
Company entitled to the benefits of the Indenture (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) and similar bank
regulatory powers and to the application of principles of
public policy);
(vii) 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 Final
Prospectus, and there is no franchise, contract or other
document of a character required to be described in the
Registration Statement or Final Prospectus, or to be filed as
an exhibit, which is not described or filed as required;
(viii) the Registration Statement has become effective under
the 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
- 8 -
<PAGE>
threatened; the Registration Statement, the Final 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 Act and the Exchange Act and the
respective rules thereunder;
(ix) this Agreement and any Delayed Delivery Contracts
have been duly authorized, executed and delivered by the
Company and each constitutes a legal, valid and binding
agreement of the Company enforceable against the Company 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 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 similar bank regulatory powers and to the
application of principles of public policy);
(x) no consent, approval, authorization or order of
any court or governmental agency or body is required on behalf
of the Company for the consummation of the transactions
contemplated herein or in any Delayed Delivery Contracts,
except such as have been obtained under the Act and such as
may be required under the blue sky or insurance laws of any
jurisdiction in connection with the purchase and distribution
of the Securities by the Underwriters and such other approvals
(specified in such opinion) as have been obtained;
(xi) neither the issue and sale of the Securities, nor the
consummation of any other of the transactions herein
contemplated nor the fulfillment of the terms hereof or of any
Delayed Delivery Contracts will conflict with, result in a
breach of, or constitute a default under the articles of
incorporation or by-laws of the Company or, to the best
knowledge of such counsel, the terms of any material indenture
or other agreement or instrument known to such counsel and to
which the Company or any of the Principal Subsidiary Banks is
a party or bound, or any order or regulation known to such
counsel to be applicable to the Company or any of the
Principal Subsidiary Banks of any court,
- 9 -
<PAGE>
regulatory body, administrative agency, governmental
body or arbitrator having jurisdiction over the Company
or any of its affiliates; and
(xii) to the best knowledge and information of such
counsel, 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.
In rendering such opinion, but without opining in connection
therewith, such counsel shall also state that, although it has
not independently verified, is not passing upon and assumes no
responsibility for the accuracy, completeness or fairness of
the statements contained in the Registration Statement, it has
no reason to believe that the Registration Statement or any
amendment thereof at the time it became effective contained
any untrue statement of a material fact or omitted to state
any material fact required to be stated therein or necessary
to make the statements therein not misleading or that the
Final Prospectus, as amended or supplemented, contains any
untrue statement of a material fact or omits to state a
material fact necessary to make the statements therein, in
light of the circumstances under which they were made, not
misleading.
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 certificates of responsible officers of the
Company and its subsidiaries and public officials.
(c) The Representatives shall have received from Stroock &
Stroock & Lavan, counsel for the Underwriters, such opinion or
opinions, dated the Closing Date, with respect to the issuance and sale
of the Securities, the Indenture, any Delayed Delivery Contracts, the
Registration Statement, the Final Prospectus and other related matters
as the Representatives may reasonably require, and the Company shall
have furnished to such counsel such documents as they request for the
purpose of enabling them to pass upon such matters.
- 10 -
<PAGE>
(d) The Company shall have furnished to the Representatives a
certificate of the Company, signed by the Chairman of the Board and
Chief Executive Officer or a Senior Vice President and the principal
financial or accounting officer of the Company, dated the Closing Date,
to the effect that the signers of such certificate have carefully
examined the Registration Statement, the Final Prospectus and this
Agreement and that to the best of their knowledge:
(i) the representations and warranties of the Company
in this Agreement are true and correct in all material
respects on and as of the Closing Date with the same effect as
if made on the Closing Date and the Company has complied with
all the agreements and satisfied all the conditions on its
part to be performed or satisfied at or prior to the Closing
Date;
(ii) no stop order suspending the effectiveness of the
Registration Statement, as amended, has been issued and no
proceedings for that purpose have been instituted or
threatened; and
(iii) since the date of the most recent financial
statements included in the Final Prospectus, there has been no
material adverse change in the condition (financial or other),
earnings, business or properties of the Company and its
subsidiaries, whether or not arising from transactions in the
ordinary course of business, except as set forth in or
contemplated in the Final Prospectus.
(e) At the Closing Date, Price Waterhouse LLP shall have
furnished to the Representatives a letter or letters (which may refer
to letters previously delivered to one or more of the Representatives),
dated as of the Closing Date, 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 Act and the Exchange Act and the respective
applicable published rules and regulations thereunder.
(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 Final Prospectus comply as to form in all
material respects with the applicable accounting requirements
of the Act and the regulations
- 11 -
<PAGE>
thereunder with respect to registration statements on Form S-3
and the Exchange Act and the regulations thereunder.
(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 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
Final 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 Final 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 Final Prospectus, do not comply
as to form in all material respects with the applicable
accounting requirements of the Exchange Act and the published
rules and 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 Final Prospectus, for them to be in conformity
with generally accepted accounting principles;
- 12 -
<PAGE>
(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 Final 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.
(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
Final 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
paragraph (e) and in Schedule I hereto.
(f) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Final Prospectus, there
shall not have been (i) any change or decrease specified in the letter
or letters referred to in paragraph (e) of this Section 5 or (ii) any
change, or any development involving a prospective change, in or
affecting the earnings, business or properties of the Company and its
subsidiaries the effect of which, in any case referred to in clause (i)
or (ii) above, is, in the
- 13 -
<PAGE>
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
Final Prospectus.
(g) Prior to the Closing Date, the Company shall have
furnished to the Representatives such further information, certificates
and documents as the Representatives may reasonably request.
(h) The Company shall have accepted Delayed Delivery Contracts
in any case where sales of Contract Securities arranged by the
Underwriters have been approved by the Company.
If any of the conditions specified in this Section 5 shall not have
been fulfilled in all material respects when and as provided in this Agreement,
or if any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall not be in all material respects reasonably satisfactory in form
and substance to the Representatives and their counsel, this Agreement and all
obligations of the Underwriters hereunder may be canceled at, or at any time
prior to, the Closing Date by the Representatives. Notice of such cancellation
shall be given to the Company in writing or by telephone or telegraph confirmed
in writing.
6. Reimbursement of Underwriters' Expenses. If the sale of the
Securities provided for herein is not consummated because any condition to the
obligations of the Underwriters set forth in Section 5 hereof is not satisfied
or because of any refusal, inability or failure on the part of the Company to
perform any agreement herein or comply with any provision hereof other than by
reason of a default by any of the Underwriters, the Company will reimburse the
Underwriters severally upon demand for all out-of-pocket expenses (including
reasonable fees and disbursements of counsel) that shall have been incurred by
them in connection with the proposed purchase and sale of the Securities.
7. Indemnification and Contribution. (a) The Company
agrees to indemnify and hold harmless each Underwriter and each
person who controls any Underwriter within the meaning of either the Act or the
Exchange Act against any and all losses, claims, damages or liabilities, joint
or several, to which they or any of them may become subject under the Act, the
Exchange Act or other Federal or state statutory law or regulation, at common
law or otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue statement
or alleged untrue statement of a material fact contained in the Registration
Statement as originally filed or in any amendment thereof, or arise out of or
are based upon
- 14 -
<PAGE>
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, or
arise out of or are based upon any untrue statement or alleged untrue statement
of a material fact contained in the Prospectus, or any amendment or supplement
thereof, or arise out of or are based upon any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading, and agrees to reimburse each such indemnified party for
any legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided, however, that (i) the Company will not be liable in any such case to
the extent that any such loss, claim, damage or liability arises out of or is
based upon any such untrue statement or alleged untrue statement or omission or
alleged omission made therein in reliance upon and in conformity with written
information furnished to the Company by or on behalf of any Underwriter through
the Representatives specifically for use in connection with the preparation
thereof, or arises out of or is based upon statements in or omissions from that
part of the Registration Statement which shall constitute the Statement of
Eligibility and Qualification of the Trustee (Form T-1) under the 1939 Act of
either of the Trustees, and (ii) such indemnity with respect to the Basic
Prospectus or any Preliminary Final Prospectus shall not inure to the benefit of
any Underwriter (or any person controlling such Underwriter) from whom the
person asserting any such loss, claim, damage or liability purchased the
Securities which are the subject thereof if such person did not receive a copy
of the Final Prospectus (or the Final Prospectus as amended or supplemented)
excluding documents incorporated therein by reference at or prior to the
confirmation of the sale of such Securities to such person in any case where
such delivery is required by the Act and the untrue statement or omission of a
material fact contained in the Basic Prospectus or any Preliminary Final
Prospectus was corrected in the Final Prospectus (or the Final Prospectus as
amended or supplemented). This indemnity agreement will be in addition to any
liability which the Company may otherwise have.
- 15 -
<PAGE>
(b) Each Underwriter severally agrees to indemnify and hold harmless
the Company, each of its directors, each of its officers who signs the
Registration Statement, and each person who controls the Company within the
meaning of either the Act or the Exchange Act, to the same extent as the
foregoing indemnity from the Company to each Underwriter, but only with
reference to written information relating to such Underwriter furnished to the
Company by or on behalf of such Underwriter through the Representatives
specifically for use in the preparation of the documents referred to in the
foregoing indemnity. This indemnity agreement will be in addition to any
liability which any Underwriter may otherwise have. The Company acknowledges
that the statements set forth in the language on the cover page required by Item
509 of Regulation S-K and under the heading "Underwriting" or "Plan of
Distribution" in any Preliminary Final Prospectus or the Final Prospectus
constitute the only information furnished in writing by or on behalf of the
several Underwriters for inclusion in the documents referred to in the foregoing
indemnity, and you, as the Representatives, confirm that such statements are
correct.
(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 the indemnifying party under this
Section 7, notify the indemnifying party in writing of the commencement thereof;
but the omission so to notify the indemnifying party will not relieve it from
any liability which it may have to any indemnified party otherwise than under
this Section 7. In case any such action is brought against any indemnified
party, and it notifies the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein, and, to the extent
that it may elect by written notice delivered to the indemnified party promptly
after receiving the aforesaid notice from such indemnified party, to assume the
defense thereof, with counsel 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 legal defenses available to it and/or other
indemnified parties which are different from or additional to those available to
the indemnifying party, the indemnified party or parties shall have the right to
select separate counsel to assert such legal defenses and to otherwise
participate in the defense of such action on behalf of such indemnified party or
parties. Upon receipt of notice from the indemnifying party to such indemnified
party of its election so to assume the defense of such action and approval by
the indemnified party of counsel, the indemnifying party will not be liable to
such indemnified party under this Section 7 for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof unless (i) the indemnified party shall have employed separate
- 16 -
<PAGE>
counsel in connection with the assertion of legal defenses in accordance with
the proviso to the next preceding sentence (it being understood, however, that
the indemnifying party shall not be liable for the expenses of more than one
separate counsel, approved by the Representatives in the case of subparagraph
(a), representing the indemnified parties under subparagraph (a) who are parties
to such action), (ii) the indemnifying party shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after notice of commencement of the action or (iii) the
indemnifying party has authorized the employment of counsel for the indemnified
party at the expense of the indemnifying party; and except that if clause (i) or
(iii) is applicable, such liability shall be only in respect of the counsel
referred to in such clause (i) or (iii).
(d) To provide for just and equitable contribution in circumstances in
which the indemnification provided for in paragraph (a) of this Section 7 is due
in accordance with its terms but is for any reason held by a court to be
unavailable from the Company on the grounds of policy or otherwise, the Company
and 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 Company 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 underwriting discount bears to the sum of such discount and the purchase
price of the Securities specified in Schedule I hereto and the Company is
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 Securities) be responsible for any amount in
excess of the underwriting discount applicable to the Securities purchased by
such Underwriter hereunder and (z) no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 7, each person who controls an
Underwriter within the meaning of the Act shall have the same rights to
contribution as such Underwriter, and each person who controls the Company
within the meaning of either the Act or the Exchange Act, each officer of the
Company who shall have signed the Registration Statement and each director of
the Company shall have the same rights to contribution as the Company, subject
in each case to clause (y) of this paragraph (d). 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
(d), notify such party or parties from whom contribution may be sought, but the
- 17 -
<PAGE>
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).
8. Default by an Underwriter. If any one or more Underwriters shall
fail to purchase and pay for any of the Securities agreed to be purchased by
such Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay for (in the respective proportions which the amount of Securities set
forth opposite their names in Schedule II hereto bear to the aggregate amount of
Securities set forth opposite the names of all the remaining Underwriters) the
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase; provided, however, that in the event that the aggregate amount of
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase shall exceed 10% of the aggregate amount of Securities set forth in
Schedule II hereto, the remaining Underwriters shall have the right to purchase
all, but shall not be under any obligation to purchase any, of the Securities,
and if such nondefaulting Underwriters do not purchase all the Securities, this
Agreement will terminate without liability to any nondefaulting Underwriter or
the Company. In the event of a default by any Underwriter as set forth in this
Section 8, the Closing Date shall be postponed for such period, not exceeding
seven days, as the Representatives shall determine in order that the required
changes in the Registration Statement and the Final Prospectus or in any other
documents or arrangements may be effected. Nothing contained in this Agreement
shall relieve any defaulting Underwriter of its liability, if any, to the
Company and any nondefaulting Underwriter for damages occasioned by its default
hereunder.
9. Termination. This Agreement shall be subject to termination in the
absolute discretion of the Representatives, by notice given to the Company prior
to delivery of and payment for the Securities, if prior to such time (i) trading
in securities generally on the New York Stock Exchange shall have been suspended
or limited or minimum prices shall have been established on such Exchange, (ii)
a banking moratorium shall have been declared either by Federal, Florida,
Georgia, Maryland, New York, North Carolina, South Carolina, Texas or Virginia
State authorities or (iii) there shall have occurred any outbreak or material
escalation of hostilities or other calamity or crisis the effect of which on the
financial markets of the United States is such as to make it, in the judgment of
the Representatives, impracticable to market the Securities.
- 18 -
<PAGE>
10. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Company or its officers and of the Underwriters set forth in or made pursuant to
this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter or the Company or any of
the officers, directors or controlling persons referred to in Section 7 hereof,
and will survive delivery of and payment for the Securities. The provisions of
Section 6 and 7 hereof and this Section 10 shall survive the termination or
cancellation of this Agreement.
11. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Representatives, will be mailed,
delivered or telegraphed and confirmed to them, at the address specified in
Schedule I hereto, with a copy to: Stroock & Stroock & Lavan, Seven Hanover
Square, New York, New York 10004-2696, Attn: James R. Tanenbaum; or, if sent to
the Company, will be mailed, delivered or telegraphed and confirmed to it at
NationsBank Corporate Center, Charlotte, North Carolina 28255, attention of the
Secretary, with a copy to each of: NationsBank Corporation, NationsBank
Corporate Center, Legal Department, NC 1007-20-1, Charlotte, North Carolina
28255, Attn: Paul J. Polking, General Counsel; and Smith Helms Mulliss & Moore,
L.L.P., 214 North Church Street, Charlotte, North Carolina 28202, Attn: Boyd C.
Campbell, Jr.
12. Successors. This Agreement will inure to the benefit
of and be binding upon the parties hereto and their respective
successors and the officers and directors and controlling persons
referred to in Section 7 hereof, and no other person will have
any right or obligation hereunder.
13. Applicable Law. This Agreement will be governed by and
construed in accordance with the internal laws of the State of
New York, without giving effect to principles of conflict of
laws.
- 19 -
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement among the
Company and the several Underwriters.
Very truly yours,
NATIONSBANK CORPORATION
By:_________________________
The foregoing Agreement is hereby confirmed and accepted as of the date
specified in Schedule I hereto.
By:
By:__________________________
For themselves and the other several Underwriters, if any, named in Schedule II
to the foregoing Agreement.
-20-
<PAGE>
SCHEDULE I
Underwriting Agreement dated ___________, 199_
Registration Statement No. 333-
Representatives:
Address of Representatives:
Title, Purchase Price and Description of Securities:
Title:
Principal amount:
Purchase price (include type of funds and accrued interest or
amortization, if applicable): ______%; in federal (same day) funds or
wire transfer to an account previously designated to the
Representatives by the Company or, if agreed to by the Representatives
and the Company, by certified or official bank check or checks.
Sinking fund provisions:
Redemption provisions:
Other provisions:
Closing Date, Time and Location: ____________, New York City
time, Office of Stroock & Stroock & Lavan
Listing:
Delayed Delivery Arrangements:
Additional items to be covered by the letter from Price Waterhouse delivered
pursuant to Section 5(e) at the time this Agreement is executed:
<PAGE>
SCHEDULE II
Principal Amount
of Securities to
Underwriters be Purchased
-2-
<PAGE>
SCHEDULE III
DELAYED DELIVERY CONTRACT
, 19
[Insert name and address
of lead Representative]
Dear Sirs:
The undersigned hereby agrees to purchase from NationsBank Corporation
(the "Company"), and the Company agrees to sell to the undersigned, on , 19 ,
(the "Delivery Date"), $ principal amount of the Company's (the "Securities")
offered by the Company's Final Prospectus dated , 19 , receipt of a copy of
which is hereby acknowledged, at a purchase price of % of the principal amount
thereof, plus accrued interest, if any, thereon from , 19 , to the date of
payment and delivery, and on the further terms and conditions set forth in this
contract.
Payment for the Securities to be purchased by the undersigned shall be
made on or before 11:00 A.M. on the Delivery Date to or upon the order of the
Company in New York Clearing House (next day) funds, at your office or at such
other place as shall be agreed between the Company and the undersigned upon
delivery to the undersigned of the Securities in definitive fully registered
form and in such authorized denominations and registered in such names as the
undersigned may request by written or telegraphic communication addressed to the
Company not less than five full business days prior to the Delivery Date. If no
request is received, the Securities will be registered in the name of the
undersigned and issued in a denomination equal to the aggregate principal amount
of Securities to be purchased by the undersigned on the Delivery Date.
The obligation of the undersigned to take delivery of and make payment
for Securities on the Delivery Date, and the obligation of the Company to sell
and deliver Securities on the Delivery Date, shall be subject to the conditions
(and neither party shall incur any liability by reason of the failure thereof)
that (1) the purchase of Securities to be made by the undersigned, which
purchase the undersigned represents is not prohibited on the date hereof, shall
not on the Delivery Date be prohibited under the laws of the jurisdiction to
which the undersigned is subject, and (2) the Company, on or before the Delivery
Date, shall have sold to certain underwriters (the "Underwriters") such
principal amount of the Securities as is to be sold to them pursuant to the
Underwriting Agreement referred to in the Final Prospectus mentioned above.
Promptly after
-3-
<PAGE>
completion of such sale to the Underwriters, the Company will mail or deliver to
the undersigned at its address set forth below notice to such effect,
accompanied by a copy of the opinion of counsel for the Company delivered to the
Underwriters in connection therewith. The obligation of the undersigned to take
delivery of and make payment for the Securities, and the obligation of the
Company to cause the Securities to be sold and delivered, shall not be affected
by the failure of any purchaser to take delivery of and make payment for the
Securities pursuant to other contracts similar to this contract.
This contract will inure to the benefit of and be binding upon the
parties hereto and their respective successors, but will not be assignable by
either party hereto without the written consent of the other.
It is understood that acceptance of this contract and other similar
contracts is in the Company's sole discretion and, without limiting the
foregoing, need not be on the first come, first served basis. If this contract
is acceptable to the Company, it is required that the Company sign the form of
acceptance below and mail or deliver one of the counterparts hereof to the
undersigned at its address set forth below. This will become a binding contract
between the Company and the undersigned, as of the date first above written,
when such counterpart is so mailed or delivered.
This agreement shall be governed by and construed in accordance with
the internal laws of the State of New York, without giving effect to principles
of conflict of laws.
Very truly yours,
-----------------------------
(Name of Purchaser)
BY:____________________________
(Signature and Title of Officer)
--------------------------------
(Address)
Accepted:
NATIONSBANK CORPORATION
By:____________________________
(Authorized Signature)
-4-
<PAGE>
[Preferred Stock]
NATIONSBANK CORPORATION
UNDERWRITING AGREEMENT
New York, New York
____________, 199_
To the Representatives
named in Schedule I
hereto of the Underwriters
named in Schedule II hereto
Dear Sirs:
NationsBank Corporation, a North Carolina corporation (the "Company"),
proposes to sell to the underwriters named in Schedule II hereto (the
"Underwriters"), for whom you are acting as representatives (the
"Representatives"), __________ shares (the "Initial Shares") of the Company's
preferred stock (the "Preferred Stock"). The Company also grants to the
Underwriters, severally and not jointly, the option described in Section 2(c) to
purchase up to _____ additional shares (the "Option Shares") of Preferred Stock
to cover over-allotments. The Company may elect to offer fractional interests in
shares of Preferred Stock, in which event the Company will provide for the
issuance by a Depositary of receipts evidencing depositary shares that will
represent such fractional interests ("Depositary Shares"). The shares of
Preferred Stock involved in any such offering are hereinafter referred to as the
"Securities" and, where appropriate herein, reference to the Securities includes
the Depositary Shares. Such Securities are to be sold to each Underwriter,
acting severally and not jointly, in such amounts as are listed in Schedule II
opposite the name of each Underwriter. The Securities are more fully described
in the Final Prospectus, referred to below. If the firm or firms listed in
Schedule II hereto include only the firm or firms listed in Schedule I hereto,
then the terms "Underwriters" and "Representatives", as used herein, each shall
be deemed to refer to such firm or firms.
1. Representations and Warranties. The Company represents
and warrants to, and agrees with, each Underwriter that:
(a) The Company meets the requirements for use of Form S-3
under the Securities Act of 1933, as amended (the "Act"), and has filed
with the Securities and Exchange Commission (the "Commission") a
registration statement on
<PAGE>
such Form (the file number of which is set forth in Schedule I hereto),
which has become effective, for the registration under the Act of the
Securities. Such registration statement, as amended at the date of this
Agreement, meets the requirements set forth in Rule 415(a)(1) under the
Act and complies in all other material respects with said Rule. The
Company proposes to file with the Commission pursuant to Rule 424 or
Rule 434 under the Act a supplement to the form of prospectus included
in such registration statement relating to the Securities and the plan
of distribution thereof and has previously advised you of all further
information (financial and other) with respect to the Company to be set
forth therein. Such registration statement, including the exhibits
thereto, as amended at the date of this Agreement, is hereinafter
called the "Registration Statement"; such prospectus in the form in
which it appears in the Registration Statement is hereinafter called
the "Basic Prospectus"; and such supplemented form of prospectus, in
the form in which it shall be filed with the Commission pursuant to
Rule 424 or Rule 434 (including the Basic Prospectus as so
supplemented) is hereinafter called the "Final Prospectus." Any
preliminary form of the Final Prospectus which has heretofore been
filed pursuant to Rule 424 hereinafter is called the "Preliminary Final
Prospectus." Any reference herein to the Registration Statement, the
Basic Prospectus, any Preliminary Final Prospectus or the Final
Prospectus shall be deemed to refer to and include the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 which
were filed under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), on or before the date of this Agreement, or the issue
date of the Basic Prospectus, any Preliminary Final Prospectus or the
Final Prospectus, as the case may be; and any reference herein to the
terms "amend", "amendment" or "supplement" with respect to the
Registration Statement, the Basic Prospectus, and the Preliminary Final
Prospectus or the Final Prospectus shall be deemed to refer to and
include the filing of any document under the Exchange Act after the
date of this Agreement, or the issue date of the Basic Prospectus, any
Preliminary Final Prospectus or the Final Prospectus, as the case may
be, and deemed to be incorporated therein by reference.
(b) As of the date hereof, when the Final Prospectus is first
filed pursuant to Rule 424 or Rule 434 under the Act, when, prior to
the Closing Date (as hereinafter defined), any amendment to the
Registration Statement becomes effective (including the filing of any
document incorporated by reference in the Registration Statement), when
any supplement to the Final Prospectus is filed with the Commission and
at the Closing Date (as hereinafter defined), (i) the Registration
Statement as amended as of
- 2 -
<PAGE>
any such time, and the Final Prospectus, as amended or supplemented as
of any such time, will comply in all material respects with the
applicable requirements of the Act, and the Exchange Act and the
respective rules thereunder, (ii) the Registration Statement, as
amended as of any such time, will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary in order to make the statements therein not
misleading, and (iii) the Final Prospectus, as amended or supplemented
as of any such time, will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary in order to make the statements therein, in light
of the circumstances under which they were made, not misleading;
provided, however, that the Company makes no representations or
warranties as to the information contained in or omitted from the
Registration Statement or the Final Prospectus or any amendment thereof
or supplement thereto in reliance upon and in conformity with
information furnished in writing to the Company by or on behalf of any
Underwriter through the Representatives specifically for use in
connection with the preparation of the Registration Statement and the
Final Prospectus.
2. Purchase and Sale. (a) Subject to the terms and conditions and in
reliance upon the representations and warranties herein set forth, the Company
agrees to sell to each Underwriter, and each Underwriter agrees, severally and
not jointly, to purchase from the Company the respective number of Initial
Shares set forth opposite such Underwriter's name in Schedule II hereto, except
that, if Schedule I hereto provides for the sale of Initial Shares pursuant to
delayed delivery arrangements, the respective amounts of Initial Shares to be
purchased by the Underwriters shall be set forth in Schedule II hereto, less the
respective amounts of Contract Securities determined as provided below. Initial
Shares to be purchased by the Underwriters are herein sometimes called the
"Underwriters' Securities" and Initial Shares to be purchased pursuant to
Delayed Delivery Contracts as hereinafter provided are herein called "Contract
Securities."
If so provided in Schedule I hereto, the Underwriters are authorized to
solicit offers to purchase Initial Shares from the Company pursuant to delayed
delivery contracts ("Delayed Delivery Contracts"), substantially in the form of
Schedule III hereto but with such changes therein as the Company may authorize
or approve. The Underwriters will endeavor to make such arrangements and, as
compensation therefor, the Company will pay to the Representatives, for the
account of the Underwriters, on the Closing Date, the purchase price set forth
on Schedule I hereto, of the Initial Shares for which Delayed Delivery Contracts
are made. Delayed Delivery Contracts are to be with
- 3 -
<PAGE>
institutional investors, including commercial and savings banks, insurance
companies, pension funds, investment companies and educational and charitable
institutions. The Company will make Delayed Delivery Contracts in all cases
where sales of Contract Securities arranged by the Underwriters have been
approved by the Company but, except as the Company may otherwise agree, each
such Delayed Delivery Contract must be for not less than the minimum amount of
Initial Shares set forth in Schedule I hereto and the aggregate amount of
Contract Securities may not exceed the maximum aggregate amount set forth in
Schedule I hereto. The Underwriters will not have any responsibility in respect
of the validity or performance of Delayed Delivery Contracts. The amount of
Initial Shares to be purchased by each Underwriter as set forth in Schedule II
hereto shall be reduced by an amount which shall bear the same proportion to the
total amount of Contract Securities as the amount of Initial Shares set forth
opposite the name of such Underwriter bears to the aggregate amount set forth in
Schedule II hereto, except to the extent that you determine that such reduction
shall be otherwise than in such proportion and so advise the Company in writing;
provided, however, that the total amount of Initial Shares to be purchased by
all Underwriters shall be the aggregate amount set forth in Schedule II hereto,
less the aggregate amount of Contract Securities.
(b) The initial public offering price and the purchase price of the
Initial Shares shall be set forth in a separate written instrument (the "Pricing
Agreement") signed by the Representatives and the Company, the form of which is
attached hereto as Schedule IV. From and after the execution and delivery of the
Pricing Agreement, this Agreement shall be deemed to include the Pricing
Agreement. The purchase price per share to be paid by the several Underwriters
for the Initial Shares shall be an amount equal to the initial public offering
price, less an amount per share to be determined by agreement among the
Representatives and the Company.
(c) In addition, on the basis of the representations and warranties
contained herein, and subject to the terms and conditions set forth herein, the
Company grants an option to the Underwriters, severally and not jointly, to
purchase up to an additional _______ Option Shares at the same price per share
determined as provided above for the Initial Shares. The option hereby granted
will expire 30 days after the date of the Pricing Agreement, and may be
exercised, in whole or in part (but not more than once), only for the purpose of
covering over-allotments upon notice by the Representatives to the Company
setting forth the number of Option Shares as to which the several Underwriters
are exercising the option, and the time and date of payment and delivery
thereof. Such time and date of Delivery (the "Date of Delivery") shall be
determined by the Representatives but shall not be later than seven full
business days after the exercise of
- 4 -
<PAGE>
such option and not in any event prior to the Closing Date (as defined below).
If the option is exercised as to all or any portion of the Option Shares, the
Option Shares 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 Shares underwriting obligations as set
forth on Schedule II.
3. Delivery and Payment. Delivery of and payment for the Underwriters'
Securities shall be made on the date and at the time specified in Schedule I
hereto, which date and time may be postponed by agreement between the
Representatives and the Company or as provided in Section 9 hereof (such date
and time of delivery and payment for the Securities being herein called the
"Closing Date"). Delivery of the Underwriters' Securities shall be made to the
Representatives for the respective accounts of the several Underwriters against
payment by the several Underwriters through the Representatives of the purchase
price thereof in the manner set forth in Schedule I hereto. Unless otherwise
agreed, certificates for the Underwriters' Securities shall be in the form set
forth in Schedule I hereto, and such certificates may be deposited with The
Depository Trust Company ("DTC") or custodian for DTC and registered in the name
of Cede & Co., as nominee for DTC.
In addition, in the event that any or all of the Option Shares are
purchased by the Underwriters, delivery and payment for the Option Shares shall
be made at the office specified for delivery of the Initial Shares in the
Pricing Agreement, or at such other place as the Company and the Representatives
shall determine, on the Date of Delivery as specified in the notice from the
Representatives to the Company. Delivery of the Option Shares 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 Schedule I hereto. Unless otherwise agreed,
certificates for the Option Shares shall be in the form set forth in Schedule I
hereto, and such certificates shall be registered in such names and in such
denominations as the Representatives may request not less than three full
business days in advance of the Date of Delivery.
4. Agreements. The Company agrees with the several
Underwriters that:
(a) Prior to the termination of the offering of the
Securities, the Company will not file any amendment of the Registration
Statement or supplement (including the Final Prospectus) to the Basic
Prospectus unless the Company has furnished you a copy for your review
prior to filing and will not file any such proposed amendment or
supplement to which you reasonably object. Subject to the foregoing
- 5 -
<PAGE>
sentence, the Company will cause the Final Prospectus to be filed with
the Commission pursuant to Rule 424 or Rule 434 via the Electronic Data
Gathering, Analysis and Retrieval System. The Company will advise the
Representatives promptly (i) when the Final Prospectus shall have been
filed with the Commission pursuant to Rule 424 or Rule 434, (ii) when
any amendment to the Registration Statement relating to the Securities
shall have become effective, (iii) of any request by the Commission for
any amendment of the Registration Statement or amendment of or
supplement to the Final Prospectus or for any additional information,
(iv) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the institution or
threatening of any proceeding for that purpose and (v) of the receipt
by the Company of any notification with respect to the suspension of
the qualification of the Securities for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose. The
Company will use its best efforts to prevent the issuance of any such
stop order and, if issued, to obtain as soon as possible the withdrawal
thereof.
(b) If, at any time when a prospectus relating to the
Securities is required to be delivered under the Act, except with
respect to any such delivery requirement imposed upon an affiliate of
the Company in connection with any secondary market sales, any event
occurs as a result of which the Final Prospectus as then amended or
supplemented would include any untrue statement of a material fact or
omit to state any material fact necessary to make the statements
therein in light of the circumstances under which they were made not
misleading, or if it shall be necessary to amend or supplement the
Final Prospectus to comply with the Act or the Exchange Act or the
respective rules thereunder, the Company promptly will prepare and file
with the Commission, subject to the first sentence of paragraph (a) of
this Section 4, an amendment or supplement which will correct such
statement or omission or an amendment which will effect such
compliance.
(c) The Company will make generally available to its security
holders and to the Representatives as soon as practicable, but not
later than 60 days after the close of the period covered thereby, an
earnings statement (in form complying with the provisions of Rule 158
of the regulations under the Act) covering a twelve month period
beginning not later than the first day of the Company's fiscal quarter
next following the "effective date" (as defined in said Rule 158) of
the Registration Statement.
(d) The Company will furnish to the Representatives
and counsel for the Underwriters, without charge, copies of
- 6 -
<PAGE>
the Registration Statement (including exhibits thereto) and each
amendment thereto which shall become effective on or prior to the
Closing Date and, so long as delivery of a prospectus by an Underwriter
or dealer may be required by the Act, as many copies of any Preliminary
Final Prospectus and the Final Prospectus and any amendments thereof
and supplements thereto as the Representatives may reasonably request.
The Company will pay the expenses of printing all documents relating to
the offering.
(e) The Company will arrange for the qualification of the
Securities for sale under the laws of such jurisdictions as the
Representatives may reasonably designate, will maintain such
qualifications in effect so long as required for the distribution of
the Securities and will arrange for the determination of the legality
of the Securities for purchase by institutional investors; provided,
however, that the Company shall not be required to qualify to do
business in any jurisdiction where it is not now so qualified or to
take any action which would subject it to general or unlimited service
of process of any jurisdiction where it is not now so subject.
(f) Until the business day following the Closing Date, the
Company will not, without the consent of the Representatives, offer or
sell, or announce the offering of, any securities covered by the
Registration Statement or by any other registration statement filed
under the Act; provided, however, the Company may, at any time, offer
or sell or announce the offering of any securities (A) covered by a
registration statement on Form S-8 or (B) covered by a registration
statement on Form S-3 and pursuant to which the Company issues
securities for its Dividend Reinvestment Plan.
5. Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters to purchase the Underwriters'
Securities shall be subject to the accuracy of the representations and
warranties on the part of the Company contained herein as of the date hereof, as
of the date of the effectiveness of any amendment to the Registration Statement
filed prior to the Closing Date (including the filing of any document
incorporated by reference therein) and as of the Closing Date, to the accuracy
of the statements of the Company made in any certificates pursuant to the
provisions hereof, to the performance by the Company of its 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 the Final Prospectus
- 7 -
<PAGE>
shall have been filed or mailed for filing with the Commission within
the time period prescribed by the Commission.
(b) The Company shall have furnished to the Representatives
the opinion of Smith Helms Mulliss & Moore, L.L.P., counsel for the
Company, dated the Closing Date, to the effect of paragraphs (i), (iv)
and (vi) through (xii) below, and the opinion of Paul J. Polking,
General Counsel to the Company, dated the Closing Date, to the effect
of paragraphs (ii), (iii) and (v) 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 and conduct its business as described in
the Final Prospectus, and is duly registered as a bank holding
company under the Bank Holding Company Act of 1956, as
amended; 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;
(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) nonassessable, and,
except as otherwise set forth in the Final 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 knowledge of
such counsel, after due inquiry, any other security interests,
claims, liens or encumbrances;
(iv) the Securities conform in all material
respects to the description thereof contained in the
Final Prospectus;
(v) if the Securities are to be listed on the
New York Stock Exchange, authorization therefor has
- 8 -
<PAGE>
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 Securities with the
New York Stock Exchange and such counsel has no reason to
believe that the Securities will not be authorized for
listing, subject to official notice of issuance and evidence
of satisfactory distribution;
(vi) 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 Final
Prospectus, and there is no franchise, contract or other
document of a character required to be described in the
Registration Statement or Final Prospectus, or to be filed as
an exhibit, which is not described or filed as required;
(vii) the Registration Statement has become effective under
the 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
Final 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 Act and the
Exchange Act and the respective rules thereunder;
(viii) this Agreement and any Delayed Delivery Contracts
have been duly authorized, executed and delivered by the
Company and each constitutes a legal, valid and binding
instrument enforceable against the Company 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 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 similar bank
- 9 -
<PAGE>
regulatory powers and to the application of principles
of public policy);
(ix) no consent, approval, authorization or order of
any court or governmental agency or body is required on behalf
of the Company for the consummation of the transactions
contemplated herein or in any Delayed Delivery Contracts,
except such as have been obtained under the Act and such as
may be required under the blue sky or insurance laws of any
jurisdiction in connection with the purchase and distribution
of the Securities by the Underwriters and such other approvals
(specified in such opinion) as have been obtained;
(x) neither the issue and sale of the Securities, nor the
consummation of any other of the transactions herein
contemplated nor the fulfillment of the terms hereof or of any
Delayed Delivery Contracts will conflict with, result in a
breach of, or constitute a default under the articles of
incorporation or by-laws of the Company or, to the best
knowledge of such counsel, the terms of any material indenture
or other agreement or instrument known to such counsel and to
which the Company or any of the Principal Subsidiary Banks is
a party or bound, or any order or regulation known to such
counsel to be applicable to the Company or any of the
Principal Subsidiary Banks of any court, regulatory body,
administrative agency, governmental body or arbitrator having
jurisdiction over the Company or any of its affiliates; and
(xi) to the best knowledge and information of such counsel,
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.
(xii) the Securities have been duly authorized and, when
paid for as contemplated herein, will be duly issued, fully
paid and nonassessable.
In rendering such opinion, but without opining in connection
therewith, such counsel shall also state that, although it has
not independently verified, is not passing upon and assumes no
responsibility for, the accuracy, completeness or fairness of
the statements contained in the Registration Statement, it has
no reason to believe that the Registration Statement or any
amendment thereof at the time it became effective contained
any untrue statement of a material fact or
- 10 -
<PAGE>
omitted to state any material fact required to be stated
therein or necessary to make the statements therein not
misleading or that the Final Prospectus, as amended or
supplemented, contains any untrue statement of a material fact
or omits to state a material fact necessary to make the
statements therein, in light of the circumstances under which
they were made, not misleading.
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 certificates of responsible officers of the
Company and its subsidiaries and public officials.
(c) The Representatives shall have received from Stroock &
Stroock & Lavan, counsel for the Underwriters, such opinion or
opinions, dated the Closing Date, with respect to the issuance and sale
of the Securities, the Indenture, any Delayed Delivery Contracts, the
Registration Statement, the Final Prospectus and other related matters
as the Representatives may reasonably require, and the Company shall
have furnished to such counsel such documents as they request for the
purpose of enabling them to pass upon such matters.
(d) The Company shall have furnished to the Representatives a
certificate of the Company, signed by the Chairman of the Board and
Chief Executive Officer or a Senior Vice President and the principal
financial or accounting officer of the Company, dated the Closing Date,
to the effect that the signers of such certificate have carefully
examined the Registration Statement, the Final Prospectus and this
Agreement and that to the best of their knowledge:
(i) the representations and warranties of the Company
in this Agreement are true and correct in all material
respects on and as of the Closing Date with the same effect as
if made on the Closing Date and the Company has complied with
all the agreements and satisfied all the conditions on its
part to be performed or satisfied at or prior to the Closing
Date;
(ii) no stop order suspending the effectiveness of
the Registration Statement, as amended, has been issued
- 11 -
<PAGE>
and no proceedings for that purpose have been
instituted or threatened; and
(iii) since the date of the most recent financial
statements included in the Final Prospectus, there has been no
material adverse change in the condition (financial or other),
earnings, business or properties of the Company and its
subsidiaries, whether or not arising from transactions in the
ordinary course of business, except as set forth in or
contemplated in the Final Prospectus.
(e) At the Closing Date, Price Waterhouse LLP shall have
furnished to the Representatives a letter or letters (which may refer
to letters previously delivered to one or more of the Representatives),
dated as of the Closing Date, 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 Act and the Exchange Act and the respective
applicable published rules and regulations thereunder.
(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 Final Prospectus comply as to form in all
material respects with the applicable accounting requirements
of the Act and the regulations thereunder with respect to
registration statements on Form S-3 and the Exchange Act and
the regulations thereunder.
(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 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
- 12 -
<PAGE>
unaudited condensed consolidated interim financial statements
of the Company and its consolidated subsidiaries included or
incorporated by reference in the Registration Statement and
Final 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 Final 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 Final Prospectus, do not comply
as to form in all material respects with the applicable
accounting requirements of the Exchange Act and the published
rules and 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 Final 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 Final 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
- 13 -
<PAGE>
Registration Statement and Prospectus discloses have occurred
or may occur, or Price Waterhouse LLP shall state any specific
changes or decreases.
(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
Final 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
paragraph (e) and in Schedule I hereto.
(f) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Final Prospectus, there
shall not have been (i) any change or decrease specified in the letter
or letters referred to in paragraph (e) of this Section 5 or (ii) any
change, or any development involving a prospective change, in or
affecting the earnings, business or properties of the Company and its
subsidiaries 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 Final Prospectus.
(g) Prior to the Closing Date, the Company shall have
furnished to the Representatives such further information, certificates
and documents as the Representatives may reasonably request.
(h) The Company shall have accepted Delayed Delivery Contracts
in any case where sales of Contract Securities arranged by the
Underwriters have been approved by the Company.
If any of the conditions specified in this Section 5 shall not have
been fulfilled in all material respects when and as provided in this Agreement,
or if any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall
- 14 -
<PAGE>
not be in all material respects reasonably satisfactory in form and substance to
the Representatives and their counsel, this Agreement and all obligations of the
Underwriters hereunder may be canceled at, or at any time prior to, the Closing
Date by the Representatives. Notice of such cancellation shall be given to the
Company in writing or by telephone or telegraph confirmed in writing.
6. Payment of Expenses. The Company will pay all expenses incident to
the performance of its obligations under this Agreement, including (i) the
printing and filing of the Registration Statement as originally filed and of
each amendment thereto, (ii) the copying of this Agreement and the Pricing
Agreement, (iii) the preparation, issuance and delivery of the certificates for
the Securities to the Underwriters, including capital duties, stamp duties and
stock transfer taxes, if any, payable upon issuance of any of the Securities,
the sale of the Securities to the Underwriters and the fees and expenses of the
transfer agent for the Securities, (iv) the fees and disbursements of the
Company's counsel and accountants, (v) the qualification of the Securities under
state securities laws in accordance with the provisions of Section 4(e),
including filing fees and the reasonable fees and disbursements of counsel for
the Underwriters in connection therewith and in connection with the preparation
of the Blue Sky Survey, (vi) the printing and delivery to the Underwriters of
copies of the Registration Statement as originally filed and of each amendment
thereto, of the preliminary prospectuses, and of the Prospectuses and any
amendments or supplements thereto, (vii) the printing and delivery to the
Underwriters of copies of the Blue Sky Survey, and (viii) the fee of the
National Association of Securities Dealers, Inc. and, if applicable, the New
York Stock Exchange.
If the sale of the Securities provided for herein is not consummated
because any condition to the obligations of the Underwriters set forth in
Section 5 hereof is not satisfied or because of any refusal, inability or
failure on the part of the Company to perform any agreement herein or comply
with any provision hereof other than by reason of a default by any of the
Underwriters, the Company will reimburse the Underwriters severally upon demand
for all out-of-pocket expenses (including reasonable fees and disbursements of
counsel) that shall have been incurred by them in connection with the proposed
purchase and sale of the Securities.
7. Conditions to Purchase of Option Shares. In the event the
Underwriters exercise the option granted in Section 2(c) hereof to purchase all
or any portion of the Option Shares and the Date of Delivery determined by the
Representatives pursuant to Section 2 is later than the Closing Date, the
obligations of the several Underwriters to purchase and pay for the Option
Shares that they shall have respectively agreed to
- 15 -
<PAGE>
purchase hereunder are subject to the accuracy of the representations and
warranties of the Company contained herein, to the performance by the Company of
its 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 Final Prospectus pursuant
to Rule 424(b) or Rule 434 under the Act shall have been made within
the proper time period.
(b) At the Date of Delivery, the Representatives shall have
received, each dated the Date of Delivery and relating to the Option
Shares:
(i) the favorable opinion of Smith Helms Mulliss & Moore,
L.L.P., counsel for the Company, in form and substance
satisfactory to counsel for the Underwriters, to the same
effect as the opinion required by Section 5(b);
(ii) the favorable opinion of Paul J. Polking,
Esq., General Counsel to the Company, in form and
substance satisfactory to counsel for the Underwriters,
to the same effect as the opinion required by Section
5(b);
(iii) the favorable opinion of Stroock & Stroock &
Lavan, counsel for the Underwriters, to the same effect
as the opinion required by Section 5(c);
(iv) a certificate of the Chairman of the Board and Chief
Executive Officer or Senior Vice President of the Company and
of the principal financial or accounting officer of the
Company with respect to the
matters set forth in Section 5(d);
(v) 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(e) except that the
"specified date" in the letter furnished pursuant to this
Section 7(b)(v) shall be a date not more than five days prior
to the Date of Delivery;
(vi) Subsequent to the respective dates as of which
information is given in the Registration Statement and the
Final Prospectus, there shall not have been (i) any change or
decrease specified in the
- 16 -
<PAGE>
letter or letters referred to in paragraph (b)(v) of this
Section 7 or (ii) any change, or any development involving a
prospective change, in or affecting the earnings, business or
properties of the Company and its subsidiaries 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 Final
Prospectus; and
(vii) such other information, certificates and
documents as the Representatives may reasonably
request.
If any of the conditions specified in this Section 7 shall not have
been fulfilled in all material respects when and as provided in this Agreement,
or if any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall not be in all material respects reasonably satisfactory in form
and substance to the Representatives and their counsel, this Agreement and all
obligations of the Underwriters hereunder may be canceled at, or at any time
prior to, the Date of Delivery by the Representatives. Notice of such
cancellation shall be given to the Company in writing or by telephone or
facsimile confirmed in writing.
8. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless each Underwriter and each person who controls any
Underwriter within the meaning of either the Act or the Exchange Act against any
and all losses, claims, damages or liabilities, joint or several, to which they
or any of them may become subject under the Act, the Exchange Act or other
Federal or state statutory law or regulation, at common law or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement as
originally filed or in any amendment thereof, or arise out of or are based upon
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, or
arise out of or are based upon any untrue statement or alleged untrue statement
of a material fact contained in the Prospectus, or any amendment or supplement
thereof, or arise out of or are based upon any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading, and agrees to reimburse each such indemnified party for
any legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim,
- 17 -
<PAGE>
damage, liability or action; provided, however, that (i) the Company will not be
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon any such untrue statement or alleged
untrue statement or omission or alleged omission made therein in reliance upon
and in conformity with written information furnished to the Company by or on
behalf of any Underwriter through the Representatives specifically for use in
connection with the preparation thereof, or arises out of or is based upon
statements in or omissions from that part of the Registration Statement which
shall constitute the Statement of Eligibility and Qualification of the Trustee
(Form T-1) under the 1939 Act of either of the Trustees, and (ii) such indemnity
with respect to the Basic Prospectus or any Preliminary Final Prospectus shall
not inure to the benefit of any Underwriter (or any person controlling such
Underwriter) from whom the person asserting any such loss, claim, damage or
liability purchased the Securities which are the subject thereof if such person
did not receive a copy of the Final Prospectus (or the Final Prospectus as
amended or supplemented) excluding documents incorporated therein by reference
at or prior to the confirmation of the sale of such Securities to such person in
any case where such delivery is required by the Act and the untrue statement or
omission of a material fact contained in the Basic Prospectus or any Preliminary
Final Prospectus was corrected in the Final Prospectus (or the Final Prospectus
as amended or supplemented). This indemnity agreement will be in addition to any
liability which the Company may otherwise have.
(b) Each Underwriter severally agrees to indemnify and hold harmless
the Company, each of its directors, each of its officers who signs the
Registration Statement, and each person who controls the Company within the
meaning of either the Act or the Exchange Act, to the same extent as the
foregoing indemnity from the Company to each Underwriter, but only with
reference to written information relating to such Underwriter furnished to the
Company by or on behalf of such Underwriter through the Representatives
specifically for use in the preparation of the documents referred to in the
foregoing indemnity. This indemnity agreement will be in addition to any
liability which any Underwriter may otherwise have. The Company acknowledges
that the statements set forth in the language on the cover page required by Item
509 of Regulation S-K and under the heading "Underwriting" or "Plan of
Distribution" in any Preliminary Final Prospectus or the Final Prospectus
constitute the only information furnished in writing by or on behalf of the
several Underwriters for inclusion in the documents referred to in the foregoing
indemnity, and you, as the Representatives, confirm that such statements are
correct.
(c) Promptly after receipt by an indemnified party under this Section 8
of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be
- 18 -
<PAGE>
made against the indemnifying party under this Section 8, notify the
indemnifying party in writing of the commencement thereof; but the omission so
to notify the indemnifying party will not relieve it from any liability which it
may have to any indemnified party otherwise than under this Section 8. In case
any such action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein, and, to the extent that it may elect by written
notice delivered to the indemnified party promptly after receiving the aforesaid
notice from such indemnified party, to assume the defense thereof, with counsel
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 legal defenses available to it and/or other indemnified
parties which are different from or additional to those available to the
indemnifying party, the indemnified party or parties shall have the right to
select separate counsel to assert such legal defenses and to otherwise
participate in the defense of such action on behalf of such indemnified party or
parties. Upon receipt of notice from the indemnifying party to such indemnified
party of its election so to assume the defense of such action and approval by
the indemnified party of counsel, the indemnifying party will not be liable to
such indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof unless (i) the indemnified party shall have employed separate counsel in
connection with the assertion of legal defenses in accordance with the proviso
to the next preceding sentence (it being understood, however, that the
indemnifying party shall not be liable for the expenses of more than one
separate counsel, approved by the Representatives in the case of subparagraph
(a), representing the indemnified parties under subparagraph (a) who are parties
to such action), (ii) the indemnifying party shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after notice of commencement of the action or (iii) the
indemnifying party has authorized the employment of counsel for the indemnified
party at the expense of the indemnifying party; and except that if clause (i) or
(iii) is applicable, such liability shall be only in respect of the counsel
referred to in such clause (i) or (iii).
(d) To provide for just and equitable contribution in circumstances in
which the indemnification provided for in paragraph (a) of this Section 8 is due
in accordance with its terms but is for any reason held by a court to be
unavailable from the Company on the grounds of policy or otherwise, the Company
and the Underwriters shall contribute to the aggregate losses, claims, damages
and liabilities (including legal or other expenses reasonably incurred in
connection with investigating or
- 19 -
<PAGE>
defending same) to which the Company 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 underwriting discount bears to
the sum of such discount and the purchase price of the Securities specified in
Schedule I hereto and the Company is 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 Securities) be
responsible for any amount in excess of the underwriting discount applicable to
the Securities purchased by such Underwriter hereunder and (z) no person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 8, each person who
controls an Underwriter within the meaning of the Act shall have the same rights
to contribution as such Underwriter, and each person who controls the Company
within the meaning of either the Act or the Exchange Act, each officer of the
Company who shall have signed the Registration Statement and each director of
the Company shall have the same rights to contribution as the Company, subject
in each case to clause (y) of this paragraph (d). 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
(d), 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).
9. Default by an Underwriter. If any one or more Underwriters shall
fail to purchase and pay for any of the Securities agreed to be purchased by
such Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay for (in the respective proportions which the amount of Securities set
forth opposite their names in Schedule II hereto bear to the aggregate amount of
Securities set forth opposite the names of all the remaining Underwriters) the
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase; provided, however, that in the event that the aggregate amount of
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase shall exceed 10% of the aggregate amount of Securities set forth in
Schedule II hereto, the remaining Underwriters shall have the right to purchase
all, but shall not be under any obligation to purchase any, of the Securities,
and if such nondefaulting Underwriters do not
- 20 -
<PAGE>
purchase all the Securities, this Agreement will terminate without liability to
any nondefaulting Underwriter or the Company. In the event of a default by any
Underwriter as set forth in this Section 9, the Closing Date shall be postponed
for such period, not exceeding seven days, as the Representatives shall
determine in order that the required changes in the Registration Statement and
the Final Prospectus or in any other documents or arrangements may be effected.
Nothing contained in this Agreement shall relieve any defaulting Underwriter of
its liability, if any, to the Company and any nondefaulting Underwriter for
damages occasioned by its default hereunder.
10. Termination. This Agreement shall be subject to termination in the
absolute discretion of the Representatives, by notice given to the Company prior
to delivery of and payment for the Securities, if prior to such time (i) trading
in securities generally on the New York Stock Exchange shall have been suspended
or limited or minimum prices shall have been established on such Exchange, (ii)
a banking moratorium shall have been declared either by Federal, Florida,
Georgia, Maryland, New York, North Carolina, South Carolina, Texas or Virginia
State authorities or (iii) there shall have occurred any outbreak or material
escalation of hostilities or other calamity or crisis the effect of which on the
financial markets of the United States is such as to make it, in the judgment of
the Representatives, impracticable to market the Securities.
11. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Company or its officers and of the Underwriters set forth in or made pursuant to
this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter or the Company or any of
the officers, directors or controlling persons referred to in Section 8 hereof,
and will survive delivery of and payment for the Securities. The provisions of
Section 6 and 8 hereof and this Section 11 shall survive the termination or
cancellation of this Agreement.
12. Notices. All communications hereunder will be in
writing and effective only on receipt, and, if sent to the
Representatives, will be mailed, delivered or telegraphed and
confirmed to them, at the address specified in Schedule I hereto,
with a copy to: Stroock & Stroock & Lavan, Seven Hanover Square,
New York, New York 10004-2696, Attn: James R. Tanenbaum; or, if
sent to the Company, will be mailed, delivered or telegraphed and
confirmed to it at NationsBank Corporate Center, Charlotte, North
Carolina 28255, attention of the Secretary, with a copy to each
of: NationsBank Corporation, NationsBank Corporate Center,
Legal Department, NC 1007-20-01, Charlotte, North Carolina 28255,
Attn: Paul J. Polking, General Counsel; and Smith Helms Mulliss &
- 21 -
<PAGE>
Moore, L.L.P., 214 North Church Street, Charlotte, North Carolina
28202, Attn: Boyd C. Campbell, Jr.
13. Successors. This Agreement will inure to the benefit
of and be binding upon the parties hereto and their respective
successors and the officers and directors and controlling persons
referred to in Section 8 hereof, and no other person will have
any right or obligation hereunder.
14. Applicable Law. This Agreement will be governed by and
construed in accordance with the internal laws of the State of
New York, without giving effect to principles of conflict of
laws.
- 22 -
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement among the
Company and the several Underwriters.
Very truly yours,
NATIONSBANK CORPORATION
By:_________________________
The foregoing Agreement is hereby confirmed and accepted as of the date
specified in Schedule I hereto.
By: [Name of Representatives]
By:__________________________
For themselves and the other several Underwriters, if any, named in Schedule II
to the foregoing Agreement.
- 23 -
<PAGE>
SCHEDULE I
Underwriting Agreement dated ___________, 199_
Registration Statement No. 333-
Representatives:
Address of Representatives:
Title, Purchase Price and Description of Securities:
Title:
Purchase price (include type of funds, if applicable): ____________ in
federal (same day) funds or wire transfer to an account previously
designated to the Representatives by the Company, or if agreed to by
the Representatives and the Company, by certified or official bank
check or checks.
Other provisions:
Closing Date, Time and Location: ____________________
Delayed Delivery Arrangements:
Fee: ___________________
Minimum amount of each contract: ________________
Maximum aggregate amount of all contracts: ________________
Additional items to be covered by the letter from Price
Waterhouse delivered pursuant to Section 5(e) at the
time this Agreement is executed: _____________________________
<PAGE>
SCHEDULE II
Principal Amount
of Securities to
Underwriters be Purchased
<PAGE>
SCHEDULE III
DELAYED DELIVERY CONTRACT
, 19
[Insert name and address
of lead Representative]
Dear Sirs:
The undersigned hereby agrees to purchase from NationsBank Corporation
(the "Company"), and the Company agrees to sell to the undersigned, on , 19 ,
(the "Delivery Date"),
shares of the Company's Preferred Stock (the
"Securities") offered by the Company's Final Prospectus dated
, 19 , receipt of a copy of which is hereby acknowledged, at a
purchase price of % of the principal amount thereof, plus accrued interest, if
any, thereon from
, 19 , to the date of payment and delivery, and on the further
terms and conditions set forth in this contract.
Payment for the Securities to be purchased by the undersigned shall be
made on or before 11:00 A.M. on the Delivery Date to or upon the order of the
Company in New York Clearing House (next day) funds, at your office or at such
other place as shall be agreed between the Company and the undersigned upon
delivery to the undersigned of the Securities in definitive fully registered
form and in such authorized denominations and registered in such names as the
undersigned may request by written or telegraphic communication addressed to the
Company not less than five full business days prior to the Delivery Date. If no
request is received, the Securities will be registered in the name of the
undersigned and issued in a denomination equal to the aggregate amount of
Securities to be purchased by the undersigned on the Delivery Date.
The obligation of the undersigned to take delivery of and make payment
for Securities on the Delivery Date, and the obligation of the Company to sell
and deliver Securities on the Delivery Date, shall be subject to the conditions
(and neither party shall incur any liability by reason of the failure thereof)
that (1) the purchase of Securities to be made by the undersigned, which
purchase the undersigned represents is not prohibited on the date hereof, shall
not on the Delivery Date be prohibited under the laws of the jurisdiction to
which the undersigned is subject, and (2) the Company, on or before the Delivery
Date, shall have sold to certain underwriters (the "Underwriters") such amount
of the Securities as is to be sold to them pursuant to the Underwriting
Agreement referred to in the Final Prospectus mentioned above. Promptly after
completion of such sale to the Underwriters, the Company will mail or deliver
<PAGE>
to the undersigned at its address set forth below notice to such effect,
accompanied by a copy of the opinion of counsel for the Company delivered to the
Underwriters in connection therewith. The obligation of the undersigned to take
delivery of and make payment for the Securities, and the obligation of the
Company to cause the Securities to be sold and delivered, shall not be affected
by the failure of any purchaser to take delivery of and make payment for the
Securities pursuant to other contracts similar to this contract.
This contract will inure to the benefit of and be binding upon the
parties hereto and their respective successors, but will not be assignable by
either party hereto without the written consent of the other.
It is understood that acceptance of this contract and other similar
contracts is in the Company's sole discretion and, without limiting the
foregoing, need not be on the first come, first served basis. If this contract
is acceptable to the Company, it is required that the Company sign the form of
acceptance below and mail or deliver one of the counterparts hereof to the
undersigned at its address set forth below. This will become a binding contract
between the Company and the undersigned, as of the date first above written,
when such counterpart is so mailed or delivered.
This agreement shall be governed by and construed in accordance with
the internal laws of the State of New York, without giving effect to principles
of conflict of laws.
Very truly yours,
-----------------------------
(Name of Purchaser)
BY:____________________________
(Signature and Title of Officer)
--------------------------------
(Address)
Accepted:
NATIONSBANK CORPORATION
By:____________________________
(Authorized Signature)
- 2 -
<PAGE>
SCHEDULE IV
_________ Shares
NATIONSBANK CORPORATION
(a North Carolina corporation)
Common Stock
PRICING AGREEMENT
__________ __, 199_
as Representative of the several Underwriters
Dear Sirs:
Reference is made to the Underwriting Agreement, dated
_____________ __, 199_ (the "Underwriting Agreement"), relating to the purchase
by the several Underwriters named in Schedule I thereto, for whom you are acting
as representatives (the "Representatives"), of the above shares of Common Stock
(the "Initial Shares"), of NationsBank Corporation (the "Company").
We confirm that the Closing Time (as defined in Section 2 of
the Underwriting Agreement) shall be at 9:30 A.M., New York City time, on
__________ __, 199_ at the offices of Stroock & Stroock & Lavan, Seven Hanover
Square, New York, New York 10004.
Pursuant to Section 2 of the Underwriting Agreement, the
Company agrees with each Underwriter as follows:
1. The initial public offering price per share for the Initial
Shares, determined as provided in said Section 2, shall be $__.__.
2. The purchase price per share for the Initial Shares to be
paid by the several Underwriters shall be $__.__, being an amount equal to the
initial public offering price set forth above less $_.__ per share.
<PAGE>
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to the Company a counterpart hereof,
whereupon this instrument, along with all counterparts, will become a binding
agreement between the Underwriters and the Company in accordance with its terms.
Very truly yours,
NATIONSBANK CORPORATION
By:_____________________
CONFIRMED AND ACCEPTED:
as of the date first above written:
By:
By:________________________________
For themselves and as Representatives of the other Underwriters named in
Schedule A hereto.
-2-
<PAGE>
[Common Stock]
NATIONSBANK CORPORATION
UNDERWRITING AGREEMENT
New York, New York
____________, 199_
To the Representatives
named in Schedule I
hereto of the Underwriters
named in Schedule II hereto
Dear Sirs:
NationsBank Corporation, a North Carolina corporation (the "Company"),
proposes to issue and sell to the underwriters named in Schedule II hereto (the
"Underwriters"), for whom you are acting as representatives (the
"Representatives"), __________ shares (the "Initial Shares") of the Company's
common stock (the "Common Stock"). Such Initial Shares are to be sold to each
Underwriter, acting severally and not jointly, in such amounts as are listed in
Schedule II opposite the name of each Underwriter. The Company also grants to
the Underwriters, severally and not jointly, the option described in Section
2(c) to purchase up to _____ additional shares (the "Option Shares"; together
with the Initial Shares, the "Shares") of Common Stock to cover over-allotments.
The Common Stock is more fully described in the Final Prospectus, referred to
below. If the firm or firms listed in Schedule II hereto include only the firm
or firms listed in Schedule I hereto, then the terms "Underwriters" and
"Representatives", as used herein, each shall be deemed to refer to such firm or
firms.
1. Representations and Warranties. The Company represents
and warrants to, and agrees with, each Underwriter, as of the
date hereof and as of the date of the Pricing Agreement (such
latter date being hereinafter referred to as the "Representation
Date") that:
(a) The Company meets the requirements for use of Form S-3
under the Securities Act of 1933, as amended (the "Act"), and has filed
with the Securities and Exchange Commission (the "Commission") a
registration statement on such Form (the file number of which is set
forth in Schedule I hereto), which has become effective, for the
registration under the Act of the Shares. Such registration statement,
<PAGE>
as amended at the date of this Agreement, meets the requirements set
forth in Rule 415(a)(1) under the Act and complies in all other
material respects with said Rule. The Company proposes to file with the
Commission pursuant to Rule 424 or Rule 434 under the Act a supplement
to the form of prospectus included in such registration statement
relating to the Shares and the plan of distribution thereof and has
previously advised you of all further information (financial and other)
with respect to the Company to be set forth therein. Such registration
statement, including the exhibits thereto, as amended at the date of
this Agreement, is hereinafter called the "Registration Statement";
such prospectus in the form in which it appears in the Registration
Statement is hereinafter called the "Basic Prospectus"; and such
supplemented form of prospectus, in the form in which it shall be filed
with the Commission pursuant to Rule 424 or Rule 434 (including the
Basic Prospectus as so supplemented) is hereinafter called the "Final
Prospectus." Any preliminary form of the Final Prospectus which has
heretofore been filed pursuant to Rule 424 hereinafter is called the
"Preliminary Final Prospectus." Any reference herein to the
Registration Statement, the Basic Prospectus, any Preliminary Final
Prospectus or the Final Prospectus shall be deemed to refer to and
include the documents incorporated by reference therein pursuant to
Item 12 of Form S-3 which were filed under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), on or before the date of this
Agreement, or the issue date of the Basic Prospectus, any Preliminary
Final Prospectus or the Final Prospectus, as the case may be; and any
reference herein to the terms "amend", "amendment" or "supplement" with
respect to the Registration Statement, the Basic Prospectus, and the
Preliminary Final Prospectus or the Final Prospectus shall be deemed to
refer to and include the filing of any document under the Exchange Act
after the date of this Agreement, or the issue date of the Basic
Prospectus, any Preliminary Final Prospectus or the Final Prospectus,
as the case may be, and deemed to be incorporated therein by reference.
(b) As of the date hereof, when the Final Prospectus is first
filed pursuant to Rule 424 or Rule 434 under the Act, when, prior to
the Closing Date (as hereinafter defined), any amendment to the
Registration Statement becomes effective (including the filing of any
document incorporated by reference in the Registration Statement), when
any supplement to the Final Prospectus is filed with the Commission and
at the Closing Date (as hereinafter defined), (i) the Registration
Statement as amended as of any such time, and the Final Prospectus, as
amended or supplemented as of any such time, will comply in all
material respects with the applicable requirements of the
- 2 -
<PAGE>
Act, and the Exchange Act and the respective rules thereunder, (ii) the
Registration Statement, as amended as of any such time, will not
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to
make the statements therein not misleading, and (iii) the Final
Prospectus, as amended or supplemented as of any such time, will not
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which
they were made, not misleading; provided, however, that the Company
makes no representations or warranties as to the information contained
in or omitted from the Registration Statement or the Final Prospectus
or any amendment thereof or supplement thereto in reliance upon and in
conformity with information furnished in writing to the Company by or
on behalf of any Underwriter through the Representatives specifically
for use in connection with the preparation of the Registration
Statement and the Final Prospectus.
2. Purchase and Sale. (a) Subject to the terms and conditions and in
reliance upon the representations and warranties herein set forth, the Company
agrees to sell to each Underwriter, and each Underwriter agrees, severally and
not jointly, to purchase from the Company the respective number of Initial
Shares set forth opposite such Underwriter's name in Schedule II hereto, except
that, if Schedule I hereto provides for the sale of Initial Shares pursuant to
delayed delivery arrangements, the respective amounts of Initial Shares to be
purchased by the Underwriters shall be set forth in Schedule II hereto, less the
respective amounts of Contract Securities determined as provided below. Shares
to be purchased by the Underwriters are herein sometimes called the
"Underwriters' Securities" and Shares to be purchased pursuant to Delayed
Delivery Contracts as hereinafter provided are herein called "Contract
Securities."
If so provided in Schedule I hereto, the Underwriters are authorized to
solicit offers to purchase Initial Shares from the Company pursuant to delayed
delivery contracts ("Delayed Delivery Contracts"), substantially in the form of
Schedule III hereto but with such changes therein as the Company may authorize
or approve. The Underwriters will endeavor to make such arrangements and, as
compensation therefor, the Company will pay to the Representatives, for the
account of the Underwriters, on the Closing Date, the purchase price set forth
on Schedule I hereto, of the Initial Shares for which Delayed Delivery Contracts
are made. Delayed Delivery Contracts are to be with institutional investors,
including commercial and savings banks, insurance companies, pension funds,
investment companies and educational and charitable institutions. The Company
will make
- 3 -
<PAGE>
Delayed Delivery Contracts in all cases where sales of Contract Securities
arranged by the Underwriters have been approved by the Company but, except as
the Company may otherwise agree, each such Delayed Delivery Contract must be for
not less than the minimum amount of Initial Shares set forth in Schedule I
hereto and the aggregate amount of Contract Securities may not exceed the
maximum aggregate amount set forth in Schedule I hereto. The Underwriters will
not have any responsibility in respect of the validity or performance of Delayed
Delivery Contracts. The amount of Initial Shares to be purchased by each
Underwriter as set forth in Schedule II hereto shall be reduced by an amount
which shall bear the same proportion to the total amount of Contract Securities
as the amount of Initial Shares set forth opposite the name of such Underwriter
bears to the aggregate amount set forth in Schedule II hereto, except to the
extent that you determine that such reduction shall be otherwise than in such
proportion and so advise the Company in writing; provided, however, that the
total amount of Initial Shares to be purchased by all Underwriters shall be the
aggregate amount set forth in Schedule II hereto, less the aggregate amount of
Contract Securities.
(b) The initial public offering price and the purchase price of the
Initial Shares shall be set forth in a separate written instrument (the "Pricing
Agreement") signed by the Representatives and the Company, the form of which is
attached hereto as Schedule IV. From and after the execution and delivery of the
Pricing Agreement, this Agreement shall be deemed to include the Pricing
Agreement. The purchase price per share to be paid by the several Underwriters
for the Initial Shares shall be an amount equal to the initial public offering
price, less an amount per share to be determined by agreement among the
Representatives and the Company.
(c) In addition, on the basis of the representations and warranties
contained herein, and subject to the terms and conditions set forth herein, the
Company grants an option to the Underwriters, severally and not jointly, to
purchase up to an additional _______ Option Shares at the same price per share
determined as provided above for the Initial Shares. The option hereby granted
will expire 30 days after the date of the Pricing Agreement, and may be
exercised, in whole or in part (but not more than once), only for the purpose of
covering over-allotments upon notice by the Representatives to the Company
setting forth the number of Option Shares as to which the several Underwriters
are exercising the option, and the time and date of payment and delivery
thereof. Such time and date of Delivery (the "Date of Delivery") shall be
determined by the Representatives but shall not be later than seven full
business days after the exercise of such option and not in any event prior to
the Closing Date (as defined below). If the option is exercised as to all or any
portion of the Option Shares, the Option Shares as to which the
- 4 -
<PAGE>
option is exercised shall be purchased by the Underwriters severally and not
jointly, in proportion to, as nearly as practicable, their respective Initial
Shares underwriting obligations as set forth on Schedule II.
3. Delivery and Payment. Delivery of and payment for the Initial Shares
shall be made on the date and at the time specified in the Pricing Agreement,
which date and time may be postponed by agreement between the Representatives
and the Company or as provided in Section 9 hereof (such date and time of
delivery and payment for the Initial Shares being herein called the "Closing
Date"). Delivery of the Initial Shares shall be made to the Representatives for
the respective accounts of the several Underwriters against payment by the
several Underwriters through the Representatives of the purchase price thereof
in the manner set forth in Schedule I hereto. Unless otherwise agreed,
certificates for the Initial Shares shall be in the form set forth in Schedule I
hereto, and such certificates may be deposited with The Depository Trust Company
("DTC") or a custodian for DTC and registered in the name of Cede & Co., as
nominee for DTC.
In addition, in the event that any or all of the Option Shares are
purchased by the Underwriters, delivery and payment for the Option Shares shall
be made at the office specified for delivery of the Initial Shares in the
Pricing Agreement, or at such other place as the Company and the Representatives
shall determine, on the Date of Delivery as specified in the notice from the
Representatives to the Company. Delivery of the Option Shares 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 Schedule I hereto. Unless otherwise agreed,
certificates for the Option Shares shall be in the form set forth in Schedule I
hereto, and such certificates shall be registered in such names and in such
denominations as the Representatives may request not less than three full
business days in advance of the Date of Delivery.
4. Agreements. The Company agrees with the several
Underwriters that:
(a) Prior to the termination of the offering of the Shares,
the Company will not file any amendment of the Registration Statement
or supplement (including the Final Prospectus) to the Basic Prospectus
unless the Company has furnished you a copy for your review prior to
filing and will not file any such proposed amendment or supplement to
which you reasonably object. Subject to the foregoing sentence, the
Company will cause the Final Prospectus to be filed with the Commission
pursuant to Rule 424 or Rule 434 via the Electronic Data Gathering,
Analysis and Retrieval
- 5 -
<PAGE>
System. The Company will advise the Representatives promptly (i) when
the Final Prospectus shall have been filed with the Commission pursuant
to Rule 424 or Rule 434, (ii) when any amendment to the Registration
Statement relating to the Shares shall have become effective, (iii) of
any request by the Commission for any amendment of the Registration
Statement or amendment of or supplement to the Final Prospectus or for
any additional information, (iv) of the issuance by the Commission of
any stop order suspending the effectiveness of the Registration
Statement or the institution or threatening of any proceeding for that
purpose and (v) of the receipt by the Company of any notification with
respect to the suspension of the qualification of the Shares for sale
in any jurisdiction or the initiation or threatening of any proceeding
for such purpose. The Company will use its best efforts to prevent the
issuance of any such stop order and, if issued, to obtain as soon as
possible the withdrawal thereof.
(b) If, at any time when a prospectus relating to the Shares
is required to be delivered under the Act, except with respect to any
such delivery requirement imposed upon an affiliate of the Company in
connection with any secondary market sales, any event occurs as a
result of which the Final Prospectus as then amended or supplemented
would include any untrue statement of a material fact or omit to state
any material fact necessary to make the statements therein in light of
the circumstances under which they were made not misleading, or if it
shall be necessary to amend or supplement the Final Prospectus to
comply with the Act or the Exchange Act or the respective rules
thereunder, the Company promptly will prepare and file with the
Commission, subject to the first sentence of paragraph (a) of this
Section 4, an amendment or supplement which will correct such statement
or omission or an amendment which will effect such compliance.
(c) The Company will make generally available to its security
holders and to the Representatives as soon as practicable, but not
later than 60 days after the close of the period covered thereby, an
earnings statement (in form complying with the provisions of Rule 158
of the regulations under the Act) covering a twelve month period
beginning not later than the first day of the Company's fiscal quarter
next following the "effective date" (as defined in said Rule 158) of
the Registration Statement.
(d) The Company will furnish to the Representatives and
counsel for the Underwriters, without charge, copies of the
Registration Statement (including exhibits thereto) and each amendment
thereto which shall become effective on or prior to the Closing Date
and, so long as delivery of a
- 6 -
<PAGE>
prospectus by an Underwriter or dealer may be required by the Act, as
many copies of any Preliminary Final Prospectus and the Final
Prospectus and any amendments thereof and supplements thereto as the
Representatives may reasonably request. The Company will pay the
expenses of printing all documents relating to the offering.
(e) The Company will arrange for the qualification of the
Shares for sale under the laws of such jurisdictions as the
Representatives may reasonably designate, will maintain such
qualifications in effect so long as required for the distribution of
the Shares and will arrange for the determination of the legality of
the Shares for purchase by institutional investors; provided, however,
that the Company shall not be required to qualify to do business in any
jurisdiction where it is not now so qualified or to take any action
which would subject it to general or unlimited service of process of
any jurisdiction where it is not now so subject.
(f) Until the business day following the Closing Date, the
Company will not, without the consent of the Representatives, offer or
sell, or announce the offering of, any securities covered by the
Registration Statement or by any other registration statement filed
under the Act; provided, however, the Company may, at any time, offer
or sell or announce the offering of any securities (A) covered by a
registration statement on Form S-8 or (B) covered by a registration
statement on Form S-3 and pursuant to which the Company issues
securities for its Dividend Reinvestment Plan.
5. Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters to purchase the Underwriters'
Securities shall be subject to the accuracy of the representations and
warranties on the part of the Company contained herein as of the date hereof, as
of the date of the effectiveness of any amendment to the Registration Statement
filed prior to the Closing Date (including the filing of any document
incorporated by reference therein) and as of the Closing Date, to the accuracy
of the statements of the Company made in any certificates pursuant to the
provisions hereof, to the performance by the Company of its 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 the Final Prospectus shall have been filed or mailed
for filing with the Commission within the time period prescribed by the
Commission.
- 7 -
<PAGE>
(b) The Company shall have furnished to the Representatives
the opinion of Smith Helms Mulliss & Moore, L.L.P., counsel for the
Company, dated the Closing Date, to the effect of paragraphs (i), (iv)
and (vi) through (xii) below, and the opinion of Paul J. Polking,
General Counsel to the Company, dated the Closing Date, to the effect
of paragraphs (ii), (iii) and (v) 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 and conduct its business as described in
the Final Prospectus, and is duly registered as a bank holding
company under the Bank Holding Company Act of 1956, as
amended; 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;
(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) nonassessable, and,
except as otherwise set forth in the Final 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 knowledge of
such counsel, after due inquiry, any other security interests,
claims, liens or encumbrances;
(iv) the Shares conform in all material respects
to the description thereof contained in the Final
Prospectus;
(v) if the Shares 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
- 8 -
<PAGE>
Initial Shares with the New York Stock Exchange and such
counsel has no reason to believe that the Initial Shares will
not be authorized for listing, subject to official notice of
issuance and evidence of satisfactory distribution;
(vi) 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 Final
Prospectus, and there is no franchise, contract or other
document of a character required to be described in the
Registration Statement or Final Prospectus, or to be filed as
an exhibit, which is not described or filed as required;
(vii) the Registration Statement has become effective under
the 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
Final 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 Act and the
Exchange Act and the respective rules thereunder;
(viii) this Agreement, the Pricing Agreement and any Delayed
Delivery Contracts have been duly authorized, executed and
delivered by the Company and each constitutes a legal, valid
and binding agreement of the Company enforceable against the
Company 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
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 similar bank regulatory
powers and to the application of principles of public policy);
- 9 -
<PAGE>
(ix) no consent, approval, authorization or order of any
court or governmental agency or body is required on behalf of
the Company for the consummation of the transactions
contemplated herein or in any Delayed Delivery Contracts,
except such as have been obtained under the Act and such as
may be required under the blue sky or insurance laws of any
jurisdiction in connection with the purchase and distribution
of the Shares by the Underwriters and such other approvals
(specified in such opinion) as have been obtained;
(x) neither the issue and sale of the Shares, nor the
consummation of any other of the transactions herein
contemplated nor the fulfillment of the terms hereof or of any
Delayed Delivery Contracts will conflict with, result in a
breach of, or constitute a default under the articles of
incorporation or by-laws of the Company or, to the best
knowledge of such counsel, the terms of any material indenture
or other agreement or instrument known to such counsel and to
which the Company or any of the Principal Subsidiary Banks is
a party or bound, or any order or regulation known to such
counsel to be applicable to the Company or any of the
Principal Subsidiary Banks of any court, regulatory body,
administrative agency, governmental body or arbitrator having
jurisdiction over the Company or any of its affiliates; and
(xi) to the best knowledge and information of such
counsel, 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.
(xii) the Initial Shares, any Option Shares as to which the
option granted in Section 2 has been exercised and the Date of
Delivery determined by the Representatives to be the same as
the Closing Date, have been duly authorized and, when paid for
as contemplated herein, will be duly issued, fully paid and
nonassessable.
In rendering such opinion, but without opining in connection
therewith, such counsel shall also state that, although it has
not independently verified, is not passing upon and assumes no
responsibility for the accuracy, completeness or fairness of
the statements contained in the Registration Statement, it has
no reason to believe that the Registration Statement or any
amendment thereof at the time it became effective
- 10 -
<PAGE>
contained any untrue statement of a material fact or omitted
to state any material fact required to be stated therein or
necessary to make the statements therein not misleading or
that the Final Prospectus, as amended or supplemented,
contains any untrue statement of a material fact or omits to
state a material fact necessary to make the statements
therein, in light of the circumstances under which they were
made, not misleading.
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 certificates of responsible officers of the
Company and its subsidiaries and public officials.
(c) The Representatives shall have received from Stroock &
Stroock & Lavan, counsel for the Underwriters, such opinion or
opinions, dated the Closing Date, with respect to the issuance and sale
of the Initial Shares, the Indenture, any Delayed Delivery Contracts,
the Registration Statement, the Final Prospectus and other related
matters as the Representatives may reasonably require, and the Company
shall have furnished to such counsel such documents as they request for
the purpose of enabling them to pass upon such matters.
(d) The Company shall have furnished to the Representatives a
certificate of the Company, signed by the Chairman of the Board and
Chief Executive Officer or a Senior Vice President and the principal
financial or accounting officer of the Company, dated the Closing Date,
to the effect that the signers of such certificate have carefully
examined the Registration Statement, the Final Prospectus and this
Agreement and that to the best of their knowledge:
(i) the representations and warranties of the Company
in this Agreement are true and correct in all material
respects on and as of the Closing Date with the same effect as
if made on the Closing Date and the Company has complied with
all the agreements and satisfied all the conditions on its
part to be performed or satisfied at or prior to the Closing
Date;
(ii) no stop order suspending the effectiveness of
the Registration Statement, as amended, has been issued
- 11 -
<PAGE>
and no proceedings for that purpose have been
instituted or threatened; and
(iii) since the date of the most recent financial
statements included in the Final Prospectus, there has been no
material adverse change in the condition (financial or other),
earnings, business or properties of the Company and its
subsidiaries, whether or not arising from transactions in the
ordinary course of business, except as set forth in or
contemplated in the Final Prospectus.
(e) At the Closing Date, Price Waterhouse LLP shall have
furnished to the Representatives a letter or letters (which may refer
to letters previously delivered to one or more of the Representatives),
dated as of the Closing Date, 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 Act and the Exchange Act and the respective
applicable published rules and regulations thereunder.
(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 Final Prospectus comply as to form in all
material respects with the applicable accounting requirements
of the Act and the regulations thereunder with respect to
registration statements on Form S-3 and the Exchange Act and
the regulations thereunder.
(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 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
- 12 -
<PAGE>
unaudited condensed consolidated interim financial statements
of the Company and its consolidated subsidiaries included or
incorporated by reference in the Registration Statement and
Final 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 Final 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 Final Prospectus, do not comply
as to form in all material respects with the applicable
accounting requirements of the Exchange Act and the published
rules and 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 Final 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 Final 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
- 13 -
<PAGE>
Registration Statement and Final Prospectus discloses have
occurred or may occur, or Price Waterhouse LLP shall state any
specific changes or decreases.
(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
Final 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
paragraph (e) and in Schedule I hereto.
(f) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Final Prospectus, there
shall not have been (i) any change or decrease specified in the letter
or letters referred to in paragraph (e) of this Section 5 or (ii) any
change, or any development involving a prospective change, in or
affecting the earnings, business or properties of the Company and its
subsidiaries 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 Shares as contemplated by the
Registration Statement and the Final Prospectus.
(g) Prior to the Closing Date, the Company shall have
furnished to the Representatives such further information, certificates
and documents as the Representatives may reasonably request.
(h) The Company shall have accepted Delayed Delivery Contracts
in any case where sales of Contract Securities arranged by the
Underwriters have been approved by the Company.
If any of the conditions specified in this Section 5 shall not have
been fulfilled in all material respects when and as provided in this Agreement,
or if any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall
- 14 -
<PAGE>
not be in all material respects reasonably satisfactory in form and substance to
the Representatives and their counsel, this Agreement and all obligations of the
Underwriters hereunder may be canceled at, or at any time prior to, the Closing
Date by the Representatives. Notice of such cancellation shall be given to the
Company in writing or by telephone or telegraph confirmed in writing.
6. Payment of Expenses. The Company will pay all expenses incident to
the performance of its obligations under this Agreement, including (i) the
printing and filing of the Registration Statement as originally filed and of
each amendment thereto, (ii) the copying of this Agreement and the Pricing
Agreement, (iii) the preparation, issuance and delivery of the certificates for
the Shares to the Underwriters, including capital duties, stamp duties and stock
transfer taxes, if any, payable upon issuance of any of the Shares, the sale of
the Shares to the Underwriters and the fees and expenses of the transfer agent
for the Shares, (iv) the fees and disbursements of the Company's counsel and
accountants, (v) the qualification of the Shares under state securities laws in
accordance with the provisions of Section 4(e), including filing fees and the
reasonable fees and disbursements of counsel for the Underwriters in connection
therewith and in connection with the preparation of the Blue Sky Survey, (vi)
the printing and delivery to the Underwriters of copies of the Registration
Statement as originally filed and of each amendment thereto, of the preliminary
prospectuses, and of the Prospectuses and any amendments or supplements thereto,
(vii) the printing and delivery to the Underwriters of copies of the Blue Sky
Survey, and (viii) the fee of the National Association of Securities Dealers,
Inc. and, if applicable, the New York Stock Exchange.
If the sale of the Shares provided for herein is not consummated
because any condition to the obligations of the Underwriters set forth in
Section 5 hereof is not satisfied or because of any refusal, inability or
failure on the part of the Company to perform any agreement herein or comply
with any provision hereof other than by reason of a default by any of the
Underwriters, the Company will reimburse the Underwriters severally upon demand
for all out-of-pocket expenses (including reasonable fees and disbursements of
counsel) that shall have been incurred by them in connection with the proposed
purchase and sale of the Shares.
7. Conditions to Purchase of Option Shares. In the event the
Underwriters exercise the option granted in Section 2(c) hereof to purchase all
or any portion of the Option Shares and the Date of Delivery determined by the
Representatives pursuant to Section 2 is later than the Closing Date, the
obligations of the several Underwriters to purchase and pay for the Option
Shares that they shall have respectively agreed to
- 15 -
<PAGE>
purchase hereunder are subject to the accuracy of the representations and
warranties of the Company contained herein, to the performance by the Company of
its 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 Final Prospectus pursuant
to Rule 424(b) or Rule 434 under the Act shall have been made within
the proper time period.
(b) At the Date of Delivery, the Representatives shall have
received, each dated the Date of Delivery and relating to the Option
Shares:
(i) the favorable opinion of Smith Helms Mulliss &
Moore, L.L.P., counsel for the Company, in form and substance
satisfactory to counsel for the Underwriters, to the same
effect as the opinion required by Section 5(b);
(ii) the favorable opinion of Paul J. Polking, Esq.,
General Counsel to the Company, in form and substance
satisfactory to counsel for the Underwriters, to the same
effect as the opinion required by Section 5(b);
(iii) the favorable opinion of Stroock & Stroock &
Lavan, counsel for the Underwriters, to the same effect as the
opinion required by Section 5(c);
(iv) a certificate, of the Chairman of the Board and
Chief Executive Officer or Senior Vice President of the
Company and of the principal financial or accounting officer
of the Company with respect to the matters set forth in
Section 5(d);
(v) 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(e) except that the
"specified date" in the letter furnished pursuant to this
Section 7(b)(v) shall be a date not more than five days prior
to the Date of Delivery;
(vi) Subsequent to the respective dates as of which
information is given in the Registration Statement and the
Final Prospectus, there shall not have been (i) any change or
decrease specified in the
- 16 -
<PAGE>
letter or letters referred to in paragraph (b)(v) of this
Section 7 or (ii) any change, or any development involving a
prospective change, in or affecting the earnings, business or
properties of the Company and its subsidiaries 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 Shares as
contemplated by the Registration Statement and the Final
Prospectus; and
(vii) such other information, certificates and
documents as the Representatives may reasonably request.
If any of the conditions specified in this Section 7 shall not have
been fulfilled in all material respects when and as provided in this Agreement,
or if any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall not be in all material respects reasonably satisfactory in form
and substance to the Representatives and their counsel, this Agreement and all
obligations of the Underwriters hereunder may be canceled at, or at any time
prior to, the Date of Delivery by the Representatives. Notice of such
cancellation shall be given to the Company in writing or by telephone or
facsimile confirmed in writing.
8. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless each Underwriter and each person who controls any
Underwriter within the meaning of either the Act or the Exchange Act against any
and all losses, claims, damages or liabilities, joint or several, to which they
or any of them may become subject under the Act, the Exchange Act or other
Federal or state statutory law or regulation, at common law or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement as
originally filed or in any amendment thereof, or arise out of or are based upon
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, or
arise out of or are based upon any untrue statement or alleged untrue statement
of a material fact contained in the Prospectus, or any amendment or supplement
thereof, or arise out of or are based upon any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading, and agrees to reimburse each such indemnified party for
any legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim,
- 17 -
<PAGE>
damage, liability or action; provided, however, that (i) the Company will not be
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon any such untrue statement or alleged
untrue statement or omission or alleged omission made therein in reliance upon
and in conformity with written information furnished to the Company by or on
behalf of any Underwriter through the Representatives specifically for use in
connection with the preparation thereof, or arises out of or is based upon
statements in or omissions from that part of the Registration Statement which
shall constitute the Statement of Eligibility and Qualification of the Trustee
(Form T-1) under the 1939 Act of either of the Trustees, and (ii) such indemnity
with respect to the Basic Prospectus or any Preliminary Final Prospectus shall
not inure to the benefit of any Underwriter (or any person controlling such
Underwriter) from whom the person asserting any such loss, claim, damage or
liability purchased the Shares which are the subject thereof if such person did
not receive a copy of the Final Prospectus (or the Final Prospectus as amended
or supplemented) excluding documents incorporated therein by reference at or
prior to the confirmation of the sale of such Shares to such person in any case
where such delivery is required by the Act and the untrue statement or omission
of a material fact contained in the Basic Prospectus or any Preliminary Final
Prospectus was corrected in the Final Prospectus (or the Final Prospectus as
amended or supplemented). This indemnity agreement will be in addition to any
liability which the Company may otherwise have.
(b) Each Underwriter severally agrees to indemnify and hold harmless
the Company, each of its directors, each of its officers who signs the
Registration Statement, and each person who controls the Company within the
meaning of either the Act or the Exchange Act, to the same extent as the
foregoing indemnity from the Company to each Underwriter, but only with
reference to written information relating to such Underwriter furnished to the
Company by or on behalf of such Underwriter through the Representatives
specifically for use in the preparation of the documents referred to in the
foregoing indemnity. This indemnity agreement will be in addition to any
liability which any Underwriter may otherwise have. The Company acknowledges
that the statements set forth in the language on the cover page required by Item
509 of Regulation S-K and under the heading "Underwriting" or "Plan of
Distribution" in any Preliminary Final Prospectus or the Final Prospectus
constitute the only information furnished in writing by or on behalf of the
several Underwriters for inclusion in the documents referred to in the foregoing
indemnity, and you, as the Representatives, confirm that such statements are
correct.
(c) Promptly after receipt by an indemnified party under this Section 8
of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be
- 18 -
<PAGE>
made against the indemnifying party under this Section 8, notify the
indemnifying party in writing of the commencement thereof; but the omission so
to notify the indemnifying party will not relieve it from any liability which it
may have to any indemnified party otherwise than under this Section 8. In case
any such action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein, and, to the extent that it may elect by written
notice delivered to the indemnified party promptly after receiving the aforesaid
notice from such indemnified party, to assume the defense thereof, with counsel
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 legal defenses available to it and/or other indemnified
parties which are different from or additional to those available to the
indemnifying party, the indemnified party or parties shall have the right to
select separate counsel to assert such legal defenses and to otherwise
participate in the defense of such action on behalf of such indemnified party or
parties. Upon receipt of notice from the indemnifying party to such indemnified
party of its election so to assume the defense of such action and approval by
the indemnified party of counsel, the indemnifying party will not be liable to
such indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof unless (i) the indemnified party shall have employed separate counsel in
connection with the assertion of legal defenses in accordance with the proviso
to the next preceding sentence (it being understood, however, that the
indemnifying party shall not be liable for the expenses of more than one
separate counsel, approved by the Representatives in the case of subparagraph
(a), representing the indemnified parties under subparagraph (a) who are parties
to such action), (ii) the indemnifying party shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after notice of commencement of the action or (iii) the
indemnifying party has authorized the employment of counsel for the indemnified
party at the expense of the indemnifying party; and except that if clause (i) or
(iii) is applicable, such liability shall be only in respect of the counsel
referred to in such clause (i) or (iii).
(d) To provide for just and equitable contribution in circumstances in
which the indemnification provided for in paragraph (a) of this Section 8 is due
in accordance with its terms but is for any reason held by a court to be
unavailable from the Company on the grounds of policy or otherwise, the Company
and the Underwriters shall contribute to the aggregate losses, claims, damages
and liabilities (including legal or other expenses reasonably incurred in
connection with investigating or
- 19 -
<PAGE>
defending same) to which the Company 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 underwriting discount bears to
the sum of such discount and the purchase price of the Securities specified in
Schedule I hereto and the Company is 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 Securities) be
responsible for any amount in excess of the underwriting discount applicable to
the Securities purchased by such Underwriter hereunder and (z) no person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 8, each person who
controls an Underwriter within the meaning of the Act shall have the same rights
to contribution as such Underwriter, and each person who controls the Company
within the meaning of either the Act or the Exchange Act, each officer of the
Company who shall have signed the Registration Statement and each director of
the Company shall have the same rights to contribution as the Company, subject
in each case to clause (y) of this paragraph (d). 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
(d), 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).
9. Default by an Underwriter. If any one or more Underwriters shall
fail to purchase and pay for any of the Shares agreed to be purchased by such
Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay for (in the respective proportions which the amount of Shares set forth
opposite their names in Schedule II hereto bear to the aggregate amount of
Shares set forth opposite the names of all the remaining Underwriters) the
Shares which the defaulting Underwriter or Underwriters agreed but failed to
purchase; provided, however, that in the event that the aggregate amount of
Shares which the defaulting Underwriter or Underwriters agreed but failed to
purchase shall exceed 10% of the aggregate amount of Shares set forth in
Schedule II hereto, the remaining Underwriters shall have the right to purchase
all, but shall not be under any obligation to purchase any, of the Shares, and
if such nondefaulting Underwriters do not purchase all the Shares, this
Agreement will terminate without liability
- 20 -
<PAGE>
to any nondefaulting Underwriter or the Company. In the event of a default by
any Underwriter as set forth in this Section 9, the Closing Date shall be
postponed for such period, not exceeding seven days, as the Representatives
shall determine in order that the required changes in the Registration Statement
and the Final Prospectus or in any other documents or arrangements may be
effected. Nothing contained in this Agreement shall relieve any defaulting
Underwriter of its liability, if any, to the Company and any nondefaulting
Underwriter for damages occasioned by its default hereunder.
10. Termination. This Agreement shall be subject to termination in the
absolute discretion of the Representatives, by notice given to the Company prior
to delivery of and payment for the Shares, if prior to such time (i) trading in
securities generally on the New York Stock Exchange shall have been suspended or
limited or minimum prices shall have been established on such Exchange, (ii) a
banking moratorium shall have been declared either by Federal, Florida, Georgia,
Maryland, New York, North Carolina, South Carolina, Texas or Virginia State
authorities or (iii) there shall have occurred any outbreak or material
escalation of hostilities or other calamity or crisis the effect of which on the
financial markets of the United States is such as to make it, in the judgment of
the Representatives, impracticable to market the Shares.
11. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Company or its officers and of the Underwriters set forth in or made pursuant to
this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter or the Company or any of
the officers, directors or controlling persons referred to in Section 8 hereof,
and will survive delivery of and payment for the Shares. The provisions of
Section 6 and 8 hereof and this Section 11 shall survive the termination or
cancellation of this Agreement.
12. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Representatives, will be mailed,
delivered or telegraphed and confirmed to them, at the address specified in
Schedule I hereto, with a copy to: Stroock & Stroock & Lavan, Seven Hanover
Square, New York, New York 10004-2696, Attn: James R. Tanenbaum; or, if sent to
the Company, will be mailed, delivered or telegraphed and confirmed to it at
NationsBank Corporate Center, Charlotte, North Carolina 28255, attention of the
Secretary, with a copy to each of: NationsBank Corporation, NationsBank
Corporate Center, Legal Department, NC 1007-20-01, Charlotte, North Carolina
28255, Attn: Paul J. Polking, General Counsel; and Smith Helms Mulliss & Moore,
L.L.P., 214 North Church Street, Charlotte, North Carolina 28202, Attn: Boyd C.
Campbell, Jr.
- 21 -
<PAGE>
13. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the officers
and directors and controlling persons referred to in Section 8 hereof, and no
other person will have any right or obligation hereunder.
14. Applicable Law. This Agreement will be governed by and
construed in accordance with the internal laws of the State of
New York, without giving effect to principles of conflict of
laws.
- 22 -
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement among the
Company and the several Underwriters.
Very truly yours,
NATIONSBANK CORPORATION
By:_________________________
The foregoing Agreement is hereby confirmed and accepted as of the date
specified in Schedule I hereto.
By: [Name of Representatives]
By:__________________________
For themselves and the other several Underwriters, if any, named in Schedule II
to the foregoing Agreement.
-23-
<PAGE>
SCHEDULE I
Underwriting Agreement dated ___________, 199_
Registration Statement No. 333-
Representatives:
Address of Representatives:
Title, Purchase Price and Description of Securities:
Title:
Purchase price (include type of funds, if applicable): ____________ in
federal (same day) funds or wire transfer to an account previously
designated to the Representatives by the Company, or if agreed to by
the Representatives and the Company, by certified or official bank
check or checks.
Other provisions:
Closing Date, Time and Location: ____________________
Delayed Delivery Arrangements:
Fee: ___________________
Minimum amount of each contract: ________________
Maximum aggregate amount of all contracts: ________________
Additional items to be covered by the letter from Price
Waterhouse delivered pursuant to Section 5(e) at the
time this Agreement is executed: _____________________________
<PAGE>
SCHEDULE II
Principal Amount of
Initial Shares to
Underwriters be Purchased
-2-
<PAGE>
SCHEDULE III
DELAYED DELIVERY CONTRACT
, 19
[Insert name and address
of lead Representative]
Dear Sirs:
The undersigned hereby agrees to purchase from NationsBank Corporation
(the "Company"), and the Company agrees to sell to the undersigned, on , 19 ,
(the "Delivery Date"),
shares of the Company's Common Stock (the "Shares") offered by the
Company's Final Prospectus dated , 19 , receipt of a copy of which is hereby
acknowledged, at a purchase price of % of the principal amount thereof, plus
accrued interest, if any, thereon from , 19 , to the date of payment and
delivery, and on the further terms and conditions set forth in this contract.
Payment for the Shares to be purchased by the undersigned shall be made
on or before 11:00 A.M. on the Delivery Date to or upon the order of the Company
in New York Clearing House (next day) funds, at your office or at such other
place as shall be agreed between the Company and the undersigned upon delivery
to the undersigned of the Shares in definitive fully registered form and in such
authorized denominations and registered in such names as the undersigned may
request by written or telegraphic communication addressed to the Company not
less than five full business days prior to the Delivery Date. If no request is
received, the Shares will be registered in the name of the undersigned and
issued in a denomination equal to the aggregate amount of Shares to be purchased
by the undersigned on the Delivery Date.
The obligation of the undersigned to take delivery of and make payment
for Shares on the Delivery Date, and the obligation of the Company to sell and
deliver Shares on the Delivery Date, shall be subject to the conditions (and
neither party shall incur any liability by reason of the failure thereof) that
(1) the purchase of Shares to be made by the undersigned, which purchase the
undersigned represents is not prohibited on the date hereof, shall not on the
Delivery Date be prohibited under the laws of the jurisdiction to which the
undersigned is subject, and (2) the Company, on or before the Delivery Date,
shall have sold to certain underwriters (the "Underwriters") such amount of the
Shares as is to be sold to them pursuant to the Underwriting Agreement referred
to in the Final Prospectus mentioned above. Promptly after completion of such
sale to the Underwriters, the Company will mail or deliver to the undersigned at
its address
-3-
<PAGE>
set forth below notice to such effect, accompanied by a copy of the opinion of
counsel for the Company delivered to the Underwriters in connection therewith.
The obligation of the undersigned to take delivery of and make payment for the
Shares, and the obligation of the Company to cause the Shares to be sold and
delivered, shall not be affected by the failure of any purchaser to take
delivery of and make payment for the Shares pursuant to other contracts similar
to this contract.
This contract will inure to the benefit of and be binding upon the
parties hereto and their respective successors, but will not be assignable by
either party hereto without the written consent of the other.
It is understood that acceptance of this contract and other similar
contracts is in the Company's sole discretion and, without limiting the
foregoing, need not be on the first come, first served basis. If this contract
is acceptable to the Company, it is required that the Company sign the form of
acceptance below and mail or deliver one of the counterparts hereof to the
undersigned at its address set forth below. This will become a binding contract
between the Company and the undersigned, as of the date first above written,
when such counterpart is so mailed or delivered.
This agreement shall be governed by and construed in accordance with
the internal laws of the State of New York, without giving effect to principles
of conflict of laws.
Very truly yours,
-----------------------------
(Name of Purchaser)
BY:____________________________
(Signature and Title of Officer)
--------------------------------
(Address)
Accepted:
NATIONSBANK CORPORATION
By:____________________________
(Authorized Signature)
-4-
<PAGE>
SCHEDULE IV
_________ Shares
NATIONSBANK CORPORATION
(a North Carolina corporation)
Common Stock
PRICING AGREEMENT
__________ __, 199_
as Representative of the several Underwriters
Dear Sirs:
Reference is made to the Underwriting Agreement, dated
_____________ __, 199_ (the "Underwriting Agreement"), relating to the purchase
by the several Underwriters named in Schedule I thereto, for whom you are acting
as representatives (the "Representatives"), of the above shares of Common Stock
(the "Initial Shares"), of NationsBank Corporation (the "Company").
We confirm that the Closing Time (as defined in Section 2 of
the Underwriting Agreement) shall be at 9:30 A.M., New York City time, on
__________ __, 199_ at the offices of Stroock & Stroock & Lavan, Seven Hanover
Square, New York, New York 10004.
Pursuant to Section 2 of the Underwriting Agreement, the
Company agrees with each Underwriter as follows:
1. The initial public offering price per share for the Initial
Shares, determined as provided in said Section 2, shall be $__.__.
2. The purchase price per share for the Initial Shares to be
paid by the several Underwriters shall be $__.__, being an amount equal to the
initial public offering price set forth above less $_.__ per share.
<PAGE>
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to the Company a counterpart hereof,
whereupon this instrument, along with all counterparts, will become a binding
agreement between the Underwriters and the Company in accordance with its terms.
Very truly yours,
NATIONSBANK CORPORATION
By:_____________________
CONFIRMED AND ACCEPTED:
as of the date first above written:
By:
By:________________________________
For themselves and as Representatives of the other Underwriters named in
Schedule A hereto.
-2-
<PAGE>
SCHEDULE A
-3-
<PAGE>
[FORM OF SENIOR REGISTERED NOTE]
If the registered owner of this Note is The Depository Trust Company or a
nominee thereof, this Note is a Global Security and the following legends are
applicable: THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY
OR A NOMINEE OF A DEPOSITORY. THIS SECURITY IS NOT EXCHANGEABLE FOR NOTES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE
EXCEPT 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 DEPOSITORY TO
A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY
OR ANOTHER NOMINEE OF THE DEPOSITORY) MAY BE REGISTERED EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC") to the issuer or
its agent for registration of transfer, exchange or payment, and any certificate
issued is registered in the name of Cede & Co. or such other name as requested
by an authorized representative of DTC (and any payment
is made to Cede & Co. or to such other entity as is requested by an authorized
representative of DTC),
ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as
the registered owner hereof,
Cede & Co., has an interest herein.
THIS NOTE IS NOT A SAVINGS ACCOUNT OR A 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.
REGISTERED $________________
NUMBER R______
Common Code No. ________________ CUSIP 638585 ___
ISIN ___________________________
SEE REVERSE FOR CERTAIN DEFINITIONS
AND ADDITIONAL PROVISIONS
NATIONSBANK CORPORATION
______% SENIOR NOTE, DUE ____
NATIONSBANK CORPORATION, a corporation duly organized and existing under
the laws of the State of North Carolina (herein called the "Corporation," which
term includes any successor corporation under the Indenture referred to on the
reverse hereof), for value received, hereby promises to pay to
,
or registered assigns, the principal sum of _________________________ DOLLARS1
on _____________________, 19___,2 and to pay interest on said principal sum,
semi-annually3 in
- --------
1 This form provides for Notes denominated in, and principal and interest
payable in, United States dollars. The form, as used, may be modified to
provide, alternatively, for Notes denominated in, and principal and interest and
other amounts, if any, payable in a foreign currency or currency unit, with the
specific terms and provisions, including any limitations on the issuance of
Notes in such currency, additional provisions regarding paying and other agents
and additional provisions regarding the calculation and payment of such
currency, set forth therein.
2 This form provides for Notes that will mature only on a specified date. If the
maturity of Notes of a series may be renewed at the option of the
(continued...)
<PAGE>
arrears on ____________________ and ___________________ of each year,
commencing _________, at the
rate of ___% per annum4, from the ____________ or ____________, as the case may
be, next preceding the date of this Note to which interest has been paid, unless
the date hereof is a date to which interest has been paid, in which case from
the date of this Note, or unless no interest has been paid on the Notes, in
which case from ________________________, until payment of such principal sum
has been made or duly provided for. Notwithstanding the foregoing, if the date
hereof is after a record date for the Notes (which shall be the close of
business on the [last] [fifteenth] day of the calendar month next preceding an
interest payment date) and before the next succeeding interest payment date,
this Note shall bear interest from such interest payment date; provided,
however, that if the Corporation shall default in the payment of interest due on
such interest payment date, then this Note shall bear interest from the next
preceding interest payment date to which interest has been paid, or, if no
interest has been paid on the Notes, from __________________. The interest so
payable, and punctually paid or duly provided for, on any interest payment date
will, as provided in such Indenture, be paid to the person in whose name this
Note (or one or more predecessor Notes evidencing all or a portion of the same
debt as this Note) is registered at the close of business on the record date for
such interest payment date. The principal of and interest on this Note are
payable in such coin or currency of the United States of America as at the time
of payment is legal tender for payment of public and private debts, at the
office or agency of the Corporation in __________________ or such other places
that the Corporation shall designate as provided in such Indenture; PROVIDED,
HOWEVER, that interest may be paid, at the option of the Corporation, by check
mailed to the person entitled thereto at his address last appearing on the
Security Register of the Corporation relating to the Notes. Any interest not
punctually paid or duly provided for shall be payable as provided in such
Indenture.5
- --------
2(...continued)
Corporation, the form, as used, will be modified to provide for additional
terms relating to such renewal or extension, as the case may be, including
the period or periods for which the maturity may be renewed or extended, as
the case may be, changes in the interest rate, if any, and requirements for
notice.
3 This form provides for semi-annual interest payments. The form, as used, may
be modified to provide, alternatively, for annual, quarterly or other periodic
interest payments.
4 This form provides for interest at a fixed rate. The form, as used, may be
modified to provide, alternatively, for interest at a variable rate or rates,
with the method of determining such rate set forth therein.
5 This form does not contemplate the offer of Notes to United States Aliens
(for United States federal income tax purposes). If Notes are offered to
United States Aliens, the form of Note, as used, may be modified to provide
for the payment of additional amounts to such United States Aliens or, if
applicable, the redemption of such Notes in lieu of payment of such additional
amounts.
2
<PAGE>
Reference is made to the further provisions of this Note set forth on
the reverse hereof, which shall have the same effect as though fully set forth
at this place.
Unless the certificate of authentication hereon has been executed by or
on behalf of the Trustee or an authenticating agent on behalf of the Trustee by
manual signature, this Note shall not be entitled to any benefit under such
Indenture, or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Corporation has caused this instrument to be
duly executed by manual or facsimile signature under its corporate seal or a
facsimile thereof.
NATIONSBANK CORPORATION
Attest:
By:
_______________Secretary [Title: ]
[CORPORATE SEAL]
Dated
3
<PAGE>
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
FIRST TRUST OF NEW YORK, NATIONAL
ASSOCIATION, as Trustee,
Dated: ___________________ [By: THE BANK OF NEW YORK,
as Authenticating Agent]
By:
Authorized Signatory
4
<PAGE>
[Reverse Side of Note]
NATIONSBANK CORPORATION
______% SENIOR NOTE, DUE __________
This Note is one of a duly authorized series of Securities of the
Corporation unlimited in aggregate principal amount issued and to be issued
under an Indenture dated as of January 1, 1995 (herein called the "Indenture")
between the Corporation and
First Trust of New York, National Association, as successor trustee to
BankAmerica National Trust Company (herein called
the "Trustee," which term includes any successor trustee under the Indenture),
to which Indenture and all indentures supplemental thereto reference is hereby
made for a statement of the respective rights thereunder of the Corporation, the
Trustee and the holders of the Notes, and the terms upon which the Notes are,
and are to be, authenticated and delivered. This Note is also one of the Notes
designated as the Corporation's _____% Senior Notes, due __________ (herein
called the "Notes"), limited in aggregate principal amount to $__________.
[The Bank of New York] initially has been appointed
Security Registrar, Authenticating and Paying Agent in connection with the
Notes.
[Except as otherwise provided herein,] the Notes of this series are not
subject to redemption at the option of the Corporation or repayment at the
option of the holder prior to maturity.6
[The provisions of Article Fourteen of the Indenture do not apply to
Securities of this series.]
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Note may be registered on the Security Register
of the Corporation relating to the Notes, upon surrender of this Note for
registration of transfer at the office or agency of the Corporation designated
by it pursuant to the Indenture, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Corporation and the Trustee
or the Security Registrar 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, will be
issued to the designated transferee or transferees.
The Notes are issuable only as registered Notes without coupons in the
denominations of $______ and any integral multiple in excess thereof. As
provided in the Indenture, and subject to certain limitations therein set forth,
Notes are exchangeable for a like aggregate principal
- --------
6 This form provides for Notes that are not subject to redemption at the option
of the Corporation or repayment at the option of the holder. The form, as used,
may be modified to provide, alternatively, for redemption at the option of the
Corporation or repayment at the option of the holder, with the terms and
conditions of such redemption or repayment, as the case may be, including
provisions regarding sinking funds, if applicable, redemption prices and notice
periods, set forth therein.
5
<PAGE>
amount of Notes of different authorized denominations, as requested by the
holder surrendering the same.
If any interest payment date or maturity date for a Note falls on a day
that is not a Business Day, the interest payment date or maturity date will be
the following day that is a Business Day and the payment of interest or
principal will be made on such next Business Day as if it were made on the date
such payment was due and no additional interest will accrue on the amount so
payable for the period from and after such interest payment date or maturity
date.
No service charge will be made for any such registration of transfer or
exchange, but the Corporation may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment for registration of transfer of this Note, the
Corporation, the Trustee and any agent of the Corporation or the Trustee may
treat the person in whose name this Note is registered as the absolute owner
hereof for the purpose of receiving payment as herein provided and for all other
purposes, whether or not this Note be overdue, and neither the Corporation, the
Trustee nor any such agent shall be affected by notice to the contrary.
If an Event of Default (defined in the Indenture as (i) the
Corporation's failure to pay principal of (or premium, if any, on) any Notes
when due, or to pay interest on the Notes within 30 days after the same becomes
due, (ii) the Corporation's breach of its other covenants contained in this Note
or the Indenture, which breach is not cured within 90 days after written notice
by the Trustee or the holders of at least 25% in outstanding principal amount of
all Securities issued under the Indenture and affected thereby, and (iii)
certain events involving the bankruptcy, insolvency or liquidation of the
Corporation) shall occur with respect to the Notes, the principal of all the
Notes may be declared due and payable in the manner and with the effect provided
in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Corporation and the rights of the holders of the Notes under the Indenture at
any time by the Corporation with the consent of the holders of not less than
66-2/3% in aggregate principal amount of the Notes then outstanding and all
other Securities then outstanding issued under the Indenture and affected by
such amendment and modification. The Indenture also contains provisions
permitting the holders of a majority in aggregate principal amount of the Notes
then outstanding and all other Securities then outstanding issued under the
Indenture and affected thereby, on behalf of the holders of all such Securities,
to waive compliance by the Corporation with certain provisions of the Indenture
and certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the holder of this Note shall be conclusive and binding
upon such holder and upon all future holders of this Note and of any Note issued
upon the registration of transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent or waiver is made upon this Note.
6
<PAGE>
No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Corporation, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, place and rate, and in the coin or currency, herein prescribed.
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 or any indenture supplemental
thereto, against any incorporator, stockholder, officer or director, as such,
past, present or future, of the Corporation or 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 issue
hereof, expressly waived and released.
The Notes of this series shall be dated the date of their
authentication.
All terms used in this Note which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
If the Notes are to be issued and outstanding pursuant to a book-entry
system, the following paragraph is applicable: The Notes are being issued by
means of a book-entry system with no physical distribution of certificates to be
made except as provided in the Indenture. The book-entry system maintained by
The Depository Trust Company ("DTC") will evidence ownership of the Notes, with
transfers of ownership effected on the records of DTC and its participants
pursuant to rules and procedures established by DTC and its participants. The
Corporation will recognize Cede & Co., as nominee of DTC, while the registered
owner of the Notes, as the owner of the Notes for all purposes, including
payment of principal and interest, notices and voting. Transfer of principal and
interest to participants of DTC will be the responsibility of DTC, and transfer
of principal and interest to beneficial owners of the Notes by participants of
DTC will be the responsibility of such participants and other nominees of such
beneficial owners. [So long as the book-entry system is in effect, the selection
of any Notes to be redeemed will be determined by DTC pursuant to rules and
procedures established by DTC and its participants.]
The Corporation will not be
responsible or liable for such transfers or payments or for maintaining,
supervising or reviewing the records maintained by DTC, its participants or
persons acting through such participants.
If the Notes may be setted through depositories located in Europe, the
following paragraph is applicable: Transfers of Notes in Europe may be effected
through the facilities of Cedel Bank, Societe anonyme, and Morgan Guaranty Trust
Company of New York, Brussels office, as operator of the Euroclear system, in
accordance with the rules and procedures established by such depositories.
----------
7
<PAGE>
The following abbreviations, when used in the inscription on the face of
the within Note, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and not as
tenants in common
UNIF GIFT MIN ACT -- _________ Custodian _________
(Cust) (Minor)
under Uniform Gifts to Minors
Act __________ (State)
Additional abbreviations may also be used though not in the above list.
----------
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE
- --------------------------------------------------------------------
- --------------------------------------------------------------------
(Name and Address of Assignee, including zip code, must be printed or
typewritten.)
the within
Note, and all rights thereunder, hereby irrevocably constituting and appointing
Attorney
to transfer said Note on the books of the Corporation, with full power of
substitution in the premises.
Dated:
NOTICE: The signature to this assignment must correspond with the name
as it appears upon the face of the within Note in every particular, without
alteration or enlargement or any change whatever and must be guaranteed.
8
If the registered owner of this Note is The Depository Trust Company or a
nominee thereof, this Note is a Global Security and the following legends are
applicable. THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY
OR A NOMINEE OF A DEPOSITORY. THIS SECURITY IS NOT EXCHANGEABLE FOR NOTES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE
EXCEPT 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 DEPOSITORY TO
A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY
OR ANOTHER NOMINEE OF THE DEPOSITORY) MAY BE REGISTERED EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the issuer or its
agent for registration of transfer, exchange or payment, and any certificate
issued is registered in the name of Cede & Co. or such other name as requested
by an authorized representative of DTC (and any payment is made to Cede & Co. or
such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.1
THIS NOTE IS NOT A SAVINGS ACCOUNT OR A 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.
REGISTERED
NUMBER FXR _________ $__________
NATIONSBANK CORPORATION
MEDIUM-TERM SENIOR NOTE, SERIES ___
(Fixed Rate) CUSIP 63858R ____
ORIGINAL ISSUE DATE:
INTEREST RATE:
STATED MATURITY DATE:
FINAL MATURITY DATE:
INITIAL REDEMPTION DATE:
INITIAL REDEMPTION PERCENTAGE:
ANNUAL REDEMPTION PERCENTAGE:
PERCENTAGE REDUCTION:
OPTIONAL REPAYMENT DATE(S):
ADDITIONAL TERMS:
NationsBank Corporation, a corporation duly organized and existing
under the laws of the State of North Carolina (herein called the "Corporation,"
which term includes any successor corporation under the Indenture referred to on
the reverse hereof), for value received, hereby promises to pay to ________
______________________________________________________________________________,
or registered assigns, the principal sum of ___________________ DOLLARS on the
Stated Maturity Date specified above (except to the extent redeemed or repaid
prior to the Stated Maturity Date), and to pay interest on said principal sum,
semiannually in arrears on ____________ and __________ of each year (each an
"Interest Payment Date"), at the Interest Rate per annum specified above, until
payment of such principal sum has been made or duly provided for, commencing on
the first Interest Payment Date next succeeding the Original Issue Date
specified above, unless the Original Issue Date occurs between a Regular
_____________
1 Applies only if this Note is a Global Security.
<PAGE>
Record Date, as defined below, and the next succeeding Interest Payment Date, in
which case commencing on the Interest Payment Date following the next succeeding
Regular Record Date, and on the Stated Maturity Date or Final Maturity Date
shown above (or any Redemption Date as defined on the reverse hereof or any
Optional Repayment Date with respect to which any such option has been
exercised, each such Stated Maturity Date, Final Maturity Date, Redemption Date
and Optional Repayment Date being herein referred to as a "Maturity Date" with
respect to the principal payable on such date). Interest on this Note will
accrue from the Original Issue Date specified above until the principal amount
is paid and will be computed on the basis of a 360-day year of twelve 30-day
months. Interest payments will be in the amount of interest accrued from and
including the next preceding Interest Payment Date in respect of which interest
has been paid or duly provided for or, if no interest has been paid, from the
Original Issue Date specified above, to but excluding the Interest Payment Date
or Maturity Date, as the case may be. If the Maturity Date or an Interest
Payment Date falls on a day which is not a Business Day as defined below,
principal or interest payable with respect to such Maturity Date or Interest
Payment Date will be paid on the next succeeding Business Day with the same
force and effect as if made on such Maturity Date or Interest Payment Date, as
the case may be, and no additional interest shall accrue for the period from and
after such Maturity Date or Interest Payment Date. The interest so payable, and
punctually paid or duly provided for, on any Interest Payment Date will be paid
to the person in whose name this Note (or one or more predecessor Notes
evidencing all or a portion of the same debt as this Note) is registered at the
close of business on the Regular Record Date, which shall be the __________ or
the __________, whether or not a Business Day, as the case may be, next
preceding such Interest Payment Date; provided, however, that the first payment
of interest on any Note with an Original Issue Date, as specified above, between
a Regular Record Date and an Interest Payment Date or on an Interest Payment
Date will be made on the Interest Payment Date following the next succeeding
Regular Record Date to the person in whose name this Note is registered at the
close of business on such next succeeding Regular Record Date; and provided,
further, that interest payable on the Maturity Date will be payable to the
person to whom the principal hereof shall be payable. Any interest not
punctually paid or duly provided for shall be payable as provided in the
Indenture. As used herein, "Business Day" means any day, other than a Saturday
or Sunday or a legal holiday in New York, New York or Charlotte, North Carolina
that is not a day on which banks in New York, New York, Charlotte, North
Carolina or _________________ are not authorized or required by law or
regulation to be closed.
The principal of and interest on this Note are payable in immediately
available funds in such coin or currency of the United States of America as at
the time of payment is legal tender for payment of public and private debts at
the office or agency of the Corporation designated as provided in the
2
<PAGE>
Indenture; provided, however, that interest may be paid, at the option of the
Corporation, by check mailed to the person entitled thereto at his address last
appearing on the registry books of the Corporation relating to the Notes.
Notwithstanding the preceding sentence, payments of principal of and interest
payable on the Maturity Date will be made by wire transfer of immediately
available funds to a designated account maintained in the United States upon (i)
receipt of written notice by the Trustee from the holder hereof not less than
one Business Day prior to the due date of such principal and (ii) presentation
of this Note to the Issuing and Paying Agent at [The Bank of New York, as
Issuing and Paying Agent at 101 Barclay Street, New York, New York 10286] (the
"Corporate Trust Office").
Reference is made to the further provisions of this Note set forth on
the reverse hereof, which shall have the same effect as though fully set forth
at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee or by an Authenticating Agent on behalf of the Trustee by manual
signature, this Note shall not be entitled to any benefit under such Indenture
or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Corporation has caused this Instrument to be
duly executed, by manual or facsimile signature, under its corporate seal or a
facsimile thereof.
NATIONSBANK CORPORATION
By: _______________________________
[SEAL] [Title: ]
ATTEST:
By:______________________
___________ Secretary
3
<PAGE>
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
Dated:_____________
FIRST TRUST OF NEW YORK,
NATIONAL ASSOCIATION,
as Trustee
[By: The Bank of New York,
as Authenticating Agent]
By:__________________________
Authorized Signatory
4
<PAGE>
[Reverse of Note]
NATIONSBANK CORPORATION
MEDIUM-TERM SENIOR NOTE, SERIES ___
(Fixed Rate)
This Medium-Term Note is one of a duly authorized series of Securities
of the Corporation unlimited in aggregate principal amount (herein called the
"Notes") issued and to be issued under an Indenture dated as of January 1, 1995
(herein called the "Indenture"), between the Corporation and First Trust of New
York, National Association, as successor trustee to BankAmerica National Trust
Company (herein called the "Trustee," which term includes any successor trustee
under the Indenture) to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights thereunder of
the Corporation, the Trustee and the holders of the Notes, and the terms upon
which the Notes are, and are to be, authenticated and delivered. This Note is
also one of the Notes designated as the Corporation's Senior Medium-Term Notes,
Series ___, limited in aggregate principal amount to[ $_____________]. [The Bank
of New York initially has been appointed as Security Registrar and as Issuing
and Paying Agent in connection with the Notes.] The Notes may bear different
dates, mature at different times, bear interest at different rates and vary in
such other ways as are provided in the Indenture.
This Note is not subject to any sinking fund.
This Note may be subject to repayment at the option of the holder on
the Optional Repayment Date(s), if any, indicated on the face hereof. IF NO
OPTIONAL REPAYMENT DATES ARE SET FORTH ON THE FACE HEREOF, THIS NOTE MAY NOT BE
SO REPAID AT THE OPTION OF THE HOLDER HEREOF PRIOR TO THE STATED MATURITY DATE.
On any Optional Repayment Date this Note shall be repayable in whole or in part
in increments of $1,000 at the option of the holder hereof at a repayment price
equal to 100% of the principal amount to be repaid, together with interest
thereon payable to the date of repayment. For this Note to be repaid in whole or
in part at the option of the holder hereof, this Note must be received, with the
form entitled "Option to Elect Repayment" below duly completed, by the
Trustee/Paying Agent at the Corporate Trust Office, or such other address of
which the Corporation shall from time to time notify the holders of the Notes,
not more than 60 nor less than 30 days prior to an Optional Repayment Date.
Exercise of such repayment option by the holder hereof shall be irrevocable.
This Note may be redeemed at the option of the Corporation on any date
on and after the Initial Redemption Date, if any, specified on the face hereof
(the "Redemption Date"). IF NO INITIAL REDEMPTION DATE IS SET FORTH ON THE FACE
HEREOF, THIS NOTE MAY NOT BE REDEEMED AT THE OPTION OF THE CORPORATION PRIOR
5
<PAGE>
TO THE STATED MATURITY DATE. On and after the Initial Redemption Date, if any,
this Note may be redeemed at any time in whole or from time to time in part in
increments of $1,000 at the option of the Corporation at the applicable
Redemption Price (as defined below) together with interest thereon payable to
the Redemption Date, on notice given not more than 60 nor less than 30 days
prior to the Redemption Date. In the event of redemption of this Note in part
only, a new Note for the unredeemed portion hereof shall be issued in the name
of the holder hereof upon the surrender hereof.
If this Note is redeemable at the option of the Corporation, the
"Redemption Price" shall initially be the Initial Redemption Percentage,
specified on the face hereof, of the principal amount of this Note to be
redeemed and shall decline at each anniversary of the Initial Redemption Date by
the Annual Redemption Percentage Reduction, if any, specified on the face
hereof, of the principal amount to be redeemed until the Redemption Price is
100% of such principal amount.
[The provisions of Article Fourteen of the Indenture do not
apply to Securities of this Series.]
If an Event of Default (defined in the Indenture as (i) the
Corporation's failure to pay principal of (or premium, if any, on) the Notes
when due, or to pay interest on the Notes within 30 days after the same becomes
due, (ii) the Corporation's breach of its other covenants contained in this Note
or in the Indenture, which breach is not cured within 90 days after written
notice by the Trustee or by the holders of at least 25% in outstanding principal
amount of all Securities issued under the Indenture and affected thereby, and
(iii) certain events involving the bankruptcy, insolvency or liquidation of the
Corporation) shall occur with respect to the Notes, the principal of all the
Notes may be declared due and payable in the manner and with the effect provided
in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Corporation and the rights of the holders of the Notes under the Indenture at
any time by the Corporation with the consent of the holders of not less than 66
2/3% in aggregate principal amount of the Notes then outstanding and all other
Securities then outstanding under the Indenture and affected by such amendment
and modification. The Indenture also contains provisions permitting the holders
of a majority in aggregate principal amount of Notes then outstanding and all
other Securities then outstanding under the Indenture and affected thereby, on
behalf of the holders of all Securities, to waive compliance by the Corporation
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the holder of
this Note shall be conclusive and binding upon such holder and
6
<PAGE>
upon all future holders of this Note and of any Note issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof whether
or not notation of such consent or waiver is made upon this 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 Corporation, which
is absolute and unconditional, to pay the principal of and interest on this Note
at the times, place and rate, and in the coin or currency, herein prescribed.
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 or any indenture supplemental
thereto, against any incorporator, stockholder, officer or director, as such,
past, present or future, of the Corporation or 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 issue
hereof, expressly waived and released.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Note may be registered on the registry books of
the Corporation relating to the Notes, upon surrender of this Note for
registration of transfer at the office or agency of the Corporation designated
by it pursuant to the Indenture, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Corporation and the Trustee
or the Security Registrar duly executed by, the 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, will be issued to the
designated transferee or transferees.
The Notes are issuable only as registered Notes without coupons in
denominations of $1,000 and any integral multiple thereof. As provided in the
Indenture, and subject to certain limitations therein set forth, Notes are
exchangeable for a like aggregate principal amount of Notes of different
authorized denominations, as requested by the holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange, but the Corporation may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment for registration of transfer of this Note, the
Corporation, the Trustee, the Issuing and Paying Agent and any agent of the
Corporation, the Trustee or the Issuing and Paying Agent may treat the entity in
whose name this
7
<PAGE>
Note is registered as the absolute owner hereof for the purpose of receiving
payment as herein provided and for all other purposes, whether or not this Note
be overdue, and neither the Corporation, the Trustee, the Issuing and Paying
Agent nor any such agent shall be affected by notice to the contrary.
All terms used in this Note which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
If the Notes are to be issued and outstanding pursuant to a book-entry
system, the following paragraph is applicable: The Notes are being issued by
means of a book-entry system with no physical distribution of certificates to be
made except as provided in the Indenture. The book-entry system maintained by
The Depository Trust Company ("DTC") will evidence ownership of the Notes, with
transfers of ownership effected on the records of DTC and its participants
pursuant to rules and procedures established by DTC and its participants. The
Corporation will recognize Cede & Co., as nominee of DTC, while the registered
owner of the Notes, as the owner of the Notes for all purposes, including
payment of principal and interest, notices and voting. Transfer of principal and
interest to participants of DTC will be the responsibility of DTC, and transfer
of principal and interest to beneficial owners of the Notes by participants of
DTC will be the responsibility of such participants and other nominees of such
beneficial owners. [So long as the book-entry system is in effect, the selection
of any Notes to be redeemed will be determined by DTC pursuant to rules and
procedures established by DTC and its participants.] The Corporation will not be
responsible or liable for such transfers or payments or for maintaining,
supervising or reviewing the records maintained by DTC, its participants or
persons acting through such participants.
If the Notes may be settled through depositories located in Europe, the
following paragraph is applicable: Transfers of Notes in Europe may be effected
through the facilities of Cedel Bank, societe anonyme, and Morgan Guaranty Trust
Company of New York, Brussels office, as operator of the Euroclear system, in
accordance with the rules and procedures established by such depositories.
8
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of the within Note shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM-- as tenants in common
TEN ENT-- as tenants by the entireties
JT TEN-- as joint tenants with right of survivorship
and not as tenants in common
UNIF GIFT MIN ACT--..........Custodian...........
(Cust) (Minor)
Under Uniform Gifts to Minors Act
.................................
(State)
Additional abbreviations may also be used though not in the above list.
_____________________________________
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s),
assign(s) and transfer(s) unto
[PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS
INCLUDING ZIP CODE, OF ASSIGNEE]
_____________________________________________________________________________
_____________________________________________________________________________
_____________________________________________________________________________
Please Insert Social Security or Other
Identifying Number of Assignee: ________________________
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing _____________________________________ Attorney to transfer said Note
on the books of the Corporation, with full power of substitution in the
premises.
Dated: ________________________ _________________________
NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Note in every particular, without alteration
or enlargement or any change whatever and must be guaranteed.
9
<PAGE>
[OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably request(s) and instruct(s) the
Corporation to repay this Note (or portion hereof specified below) pursuant to
its terms at a price equal to the principal amount hereof together with interest
to the repayment date, to the undersigned, at _________________________________
(Please print or typewrite name and address of the undersigned)
For this Note to be repaid, the Trustee (or the Paying Agent on behalf
of the Trustee) must receive at __________________, or at such other place or
places of which the Corporation shall from time to time notify the Holder of
this Note, not more than 60 nor less than 30 days prior to an Optional Repayment
Date, if any, shown on the face of this Note, this Note with this "Option to
Elect Repayment" form duly completed.
If less than the entire principal amount of this Note is to be repaid,
specify the portion hereof (which shall be in increments of $1,000) which the
Holder elects to have repaid and specify the denomination or denominations
(which shall be $__________ or an integral multiple of $l,000 in excess of
$__________) of the Notes to be issued to the Holder for the portion of this
Note not being repaid (in the absence of any such specification, one such Note
will be issued for the portion not being repaid).
$_______________________ ___________________________
DATE: __________________ NOTICE: The signature on this
Option to Elect Repayment must
correspond with the name as written
upon the face of this Note in every
particular, without alteration or
enlargement or any change
whatever.]
10
If the registered owner of this Note is The Depository Trust Company or a
nominee thereof, this Note is a Global Security and the following legends are
applicable: THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY
OR A NOMINEE OF A DEPOSITORY. THIS SECURITY IS NOT EXCHANGEABLE FOR NOTES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE
EXCEPT 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 DEPOSITORY TO
A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY
OR ANOTHER NOMINEE OF THE DEPOSITORY) MAY BE REGISTERED EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the issuer or its
agent for registration of transfer, exchange or payment, and any certificate
issued is registered in the name of Cede & Co. or such other name as requested
by an authorized representative of DTC (and any payment is made to Cede & Co. or
such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.1
THIS NOTE IS NOT A SAVINGS ACCOUNT OR A 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.
REGISTERED
NUMBER FLR _______ $_________
NATIONSBANK CORPORATION
MEDIUM-TERM SENIOR NOTE, SERIES ___
(Floating Rate)
CUSIP 63858R _________
ORIGINAL ISSUE DATE: BASE RATE:
STATED MATURITY DATE: (check one)
FINAL MATURITY DATE: ___CD Rate
INITIAL INTEREST RATE: ___Commercial Paper Rate
INDEX MATURITY FOR INITIAL ___LIBOR_____________
INTEREST RATE (IF DIFFERENT): ___Federal Funds Rate
INDEX MATURITY: ___Prime Rate
INDEX MATURITY FOR FINAL ___Treasury Rate
INTEREST PAYMENT PERIOD ___CMT Rate
(IF DIFFERENT): CMT Telerate Page:____
SPREAD: CMT Maturity Index:___
SPREAD MULTIPLIER: ___Eleventh District Cost
MAXIMUM INTEREST RATE: of Funds Rate
MAXIMUM INTEREST RATE: ___Other:________________
INTEREST PAYMENT DATES:
INTEREST RATE RESET DATES: [ ] This Note is a Renewable
INTEREST RATE RESET PERIOD: Note.
INITIAL REDEMPTION DATE: See Attached Rider.
INITIAL REDEMPTION PERCENTAGE:
ANNUAL REDEMPTION PERCENTAGE REDUCTION:
OPTIONAL PAYMENT DATE(S):
CALCULATION AGENT: [ ] This Note is an
ADDITIONAL TERMS: Extendible Note.
See Attached Rider.
NationsBank Corporation, a corporation duly organized and existing
under the laws of the State of North Carolina (herein called the "Corporation,"
which term includes any successor corporation under the Indenture referred to on
the reverse hereof), for value received, hereby promises to pay to
__________
1 Applies only if this Note is a Global Security.
<PAGE>
______________________________________________________________________,
or registered assigns, the principal sum of ________________ DOLLARS on the
Stated Maturity Date specified above (except to the extent redeemed or repaid
prior to the Stated Maturity Date), and to pay interest thereon at a rate per
annum equal to the Initial Interest Rate specified above until the Initial
Interest Reset Date specified above and thereafter at a rate determined in
accordance with the provisions on the reverse hereof, depending upon the
appropriate Base Rate and Index Maturity specified above, until the principal
hereof is paid or duly made available for payment. The Corporation will pay
interest on the Interest Payment Dates specified above, commencing with the
first Interest Payment Date next succeeding the Original Issue Date specified
above, unless the Original Issue Date occurs between a Regular Record Date, as
defined below, and the next succeeding Interest Payment Date, in which case
commencing on the Interest Payment Date following the next succeeding Regular
Record Date, and on the Stated Maturity Date or Final Maturity Date shown above
(or any Redemption Date as defined on the reverse hereof or any Optional
Repayment Date with respect to which any such option has been exercised, each
such Stated Maturity Date, Final Maturity Date, Redemption Date and Optional
Repayment Date being herein referred to as a "Maturity Date" with respect to the
principal repayable on such date). Interest on this Note will accrue from the
Original Issue Date specified above until the principal amount is paid and will
be computed as hereinafter described. Interest payable on this Note on any
Interest Payment Date or the Maturity Date will include interest accrued from
and including the next preceding Interest Payment Date in respect of which
interest has been paid or duly provided for or, if no interest has been paid,
from the Original Issue Date specified above, to but excluding such Interest
Payment Date or Maturity Date, as the case may be; provided, however, that if
the Interest Rate Reset Period with respect to this Note is daily or weekly,
interest payable on any Interest Payment Date or the Maturity Date will include
interest accrued from but excluding the Regular Record Date through which
interest has been paid to and including the Regular Record Date next preceding
such Interest Payment Date, except that interest payable on any such Maturity
Date will include interest accrued to, but excluding, such Maturity Date. If any
Interest Payment Date falls on a day which is not a Business Day, as defined
below, such Interest Payment Date shall be the following day that is a Business
Day, except that if the Base Rate is LIBOR, if such next Business Day falls in
the next succeeding calendar month, such Interest Payment Date will be the
preceding day that is a Business Day; and if the Maturity Date falls on a day
which is not a Business Day, principal or interest payable with respect to such
Maturity Date will be paid on the next succeeding Business Day with the same
force and effect as if made on such Maturity Date, and no additional interest
shall accrue for the period from and after such Maturity Date. The interest so
payable, and punctually paid or duly provided for, on any Interest Payment Date
will be paid to the person in whose name this Note (or one or more predecessor
Notes evidencing all
2
<PAGE>
or a portion of the same debt as this Note) is registered at the close of
business on the date 15 calendar days prior to such Interest Payment Date,
whether or not a Business Day (the "Regular Record Date"); provided, however,
that the first payment of interest on any Note with an Original Issue Date, as
specified above, between a Regular Record Date and an Interest Payment Date or
on an Interest Payment Date will be made on the Interest Payment Date following
the next succeeding Regular Record Date to the person in whose name this Note is
registered at the close of business on such next succeeding Regular Record Date;
and provided, further, that interest payable on the Maturity Date will be
payable to the person to whom the principal hereof shall be payable. Any such
interest not punctually paid or duly provided for shall be payable as provided
in the Indenture. As used herein, "Business Day" means any day, other than a
Saturday or Sunday or a legal holiday in New York, New York or Charlotte, North
Carolina, that is not a day (i) on which banks in New York, New York, Charlotte,
North Carolina or ______________ are authorized or required by law or regulation
to be closed and (ii) if the Base Rate is LIBOR, is a day on which dealings in
deposits on U.S. dollars are transacted in the London interbank market.
The principal of and interest on this Note are payable in immediately
available funds in such coin or currency of the United States of America as at
the time of payment is legal tender for payment of public and private debts at
the office or agency of the Corporation designated as provided in the Indenture;
provided, however, that interest may be paid, at the option of the Corporation,
by check mailed to the person entitled thereto at his address last appearing on
the registry books of the Corporation relating to the Notes. Notwithstanding the
preceding sentence, payments of principal of and interest payable on the
Maturity Date will be made by wire transfer of immediately available funds to a
designated account maintained in the United States upon (i) receipt of written
notice by the Trustee from the holder hereof not less than one Business Day
prior to the due date of such principal and (ii) presentation of this Note to
the Issuing and Paying Agent at [The Bank of New York, as Issuing and Paying
Agent, 101 Barclay Street, New York, New York 10286] (the "Corporate Trust
Office").
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof, which shall have the same effect as though fully
set forth at this place.
Unless the Certificate of Authentication hereon has been executed by
the Trustee or an Authenticating Agent on behalf of the Trustee by manual
signature, this Note shall not be entitled to any benefit under such Indenture
or be valid or obligatory for any purpose.
3
<PAGE>
IN WITNESS WHEREOF, the Corporation has caused this Instrument to be
duly executed, by manual or facsimile signature, under its corporate seal or a
facsimile thereof.
NATIONSBANK CORPORATION
By:____________________________
[Title: ]
ATTEST:
_________________________
_______________ Secretary
4
<PAGE>
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
Dated: ____________________________
FIRST TRUST OF NEW YORK, NATIONAL
ASSOCIATION,
as Trustee
[By: The Bank of New York, as
Authenticating Agent]
By:__________________________
Authorized Signatory
5
<PAGE>
[Reverse of Note]
NATIONSBANK CORPORATION
MEDIUM-TERM SENIOR NOTE, SERIES ___
(Floating Rate)
This Medium-Term Note is one of a duly authorized series of Securities
of the Corporation unlimited in aggregate principal amount (herein called the
"Notes") issued and to be issued under an Indenture dated as of January 1, 1995,
(herein called the "Indenture"), between the Corporation and First Trust of New
York, National Association, as successor trustee to BankAmerica National Trust
Company (herein called the "Trustee," which term includes any successor trustee
under the Indenture) to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights thereunder of
the Corporation, the Trustee and the holders of the Notes, and the terms upon
which the Notes are, and are to be, authenticated and delivered. This Note is
also one of the Notes designated as the Corporation's Senior Medium-Term Notes,
Series ___ (herein called the "Notes"), limited in aggregate principal amount to
[$______________]. [The Bank of New York initially has been appointed to serve
as the Security Registrar and the Issuing and Paying Agent in connection with
the Notes.] The Notes may bear different dates, mature at different times, bear
interest at different rates and vary in such other ways as are provided in the
Indenture.
This Note is not subject to any sinking fund.
This Note may be subject to repayment at the option of the holder only
if the Optional Repayment Date(s) are indicated on the face hereof. IF NO
OPTIONAL REPAYMENT DATES ARE SET FORTH ON THE FACE HEREOF, THIS NOTE MAY NOT BE
SO REPAID AT THE OPTION OF THE HOLDER HEREOF PRIOR TO THE STATED MATURITY DATE.
On any Optional Repayment Date, this Note shall be repayable in whole or in part
in increments of $1,000 at the option of the holder hereof at a repayment price
equal to 100% of the principal amount to be repaid, together with interest
thereon payable to the date of repayment. For this Note to be repaid in whole or
in part at the option of the holder hereof, this Note must be received, with the
form below entitled "Option to Elect Repayment" duly completed, by the
Trustee/Paying Agent at the Corporate Trust Office, or such other address of
which the Corporation shall from time to time notify the holders of the Notes,
not more than 60 nor less than 30 days prior to an Optional Repayment Date.
Exercise of such repayment option by the holder hereof shall be irrevocable.
This Note may be redeemed at the option of the Corporation on any date
on and after the Initial Redemption Date, if any, specified on the face hereof
(the "Redemption Date"). IF NO INITIAL REDEMPTION DATE IS SET FORTH ON THE FACE
HEREOF, THIS
6
<PAGE>
NOTE MAY NOT BE REDEEMED AT THE OPTION OF THE CORPORATION PRIOR TO THE STATED
MATURITY DATE. On and after the Initial Redemption Date, if any, this Note may
be redeemed at any time in whole or from time to time in part in increments of
$1,000 at the option of the Corporation at the applicable Redemption Price (as
defined below) together with interest thereon payable to the Redemption Date, on
notice given not more than 60 nor less than 30 days prior to the Redemption
Date. In the event of redemption of this Note in part only, a new Note for the
unredeemed portion hereof shall be issued in the name of the Holder hereof upon
the surrender hereof.
If this Note is redeemable at the option of the Corporation, the
"Redemption Price" shall initially be the Initial Redemption Percentage,
specified on the face hereof, of the principal amount of this Note to be
redeemed and shall decline at each anniversary of the Initial Redemption Date by
the Annual Redemption Percentage Reduction, if any, specified on the face
hereof, of the principal amount to be redeemed until the Redemption Price is
100% of such principal amount.
Accrued interest hereon shall be calculated by multiplying the face
amount hereof by an accrued interest factor. Such accrued interest factor shall
be computed by adding the interest factor calculated for each day from and
including the Original Issue Date, or from but excluding the last date to which
interest has been paid, as the case may be, to and including the date for which
accrued interest is being calculated. The interest factor (expressed as a
decimal) for each such day shall be computed by dividing the interest rate in
effect on such day by 360 or, in the case of Notes having the Treasury Rate or
the CMT Rate as their Base Rate, by the actual number of days in the year.
The Base Rate (as defined herein) with respect to this Note may be (i)
the CD Rate, (ii) the Commercial Paper Rate, (iii) LIBOR, (iv) the Federal Funds
Rate, (v) the Prime Rate, (vi) the Treasury Rate, (vii) the CMT Rate, (viii) the
Eleventh District Cost of Funds Rate or (ix) such other rate as will be
described on the face hereof and a rider to this Note.
Except as described below, this Note will bear interest at the rate
determined by reference to the appropriate interest rate basis (the "Base Rate")
and Index Maturity shown on the face hereof (i) plus or minus the Spread, if
any, or (ii) multiplied by the Spread Multiplier, if any, specified on the face
hereof. The interest rate in effect on each day shall be (a) if such day is an
Interest Reset Date, the interest rate determined as of the Interest
Determination Date (as defined below) pertaining to such Interest Reset Date or
(b) if such day is not an Interest Reset Date, the interest rate determined as
of the Interest Determination Date pertaining to the next preceding Interest
Reset Date, provided that (i) the interest rate in effect from the Original
Issue Date to the first Interest Reset Date shall be
7
<PAGE>
the Initial Interest Rate specified on the face hereof, and (ii) the interest
rate in effect for the ten calendar days immediately prior to the Maturity Date
shall be the rate in effect on the tenth calendar day preceding such Maturity
Date. If any Interest Reset Date would otherwise be a day that is not a Business
Day, such Interest Reset Date shall be postponed to the next day that is a
Business Day, except that if the Base Rate specified on the face hereof is
LIBOR, if such next Business Day is in the next succeeding calendar month, such
Interest Reset Date shall be the immediately preceding Business Day. The term
"Final Interest Payment Period" means the period from the final Interest Reset
Date to the Maturity Date.
The Interest Determination Date with respect to any Note that has as
its Base Rate the CD Rate, the Commercial Paper Rate, the Federal Funds Rate,
the Prime Rate or the CMT Rate will be the second Business Day preceding the
Interest Reset Date. The Interest Determination Date with respect to LIBOR shall
be the second London Banking Day (as defined below) preceding the Interest Reset
Date. The Interest Determination Date with respect to the Eleventh District Cost
of Funds Rate will be the last Business Day of the month immediately preceding
such Interest Reset Date in which the Federal Home Loan Bank of San Francisco
(the "FHLB") publishes such Index (as defined below); and the Interest
Determination Date with respect to the Treasury Rate shall be the day of the
week in which the Interest Reset Date falls on which Treasury bills of the Index
Maturity specified on the face hereof normally would be auctioned; provided,
however, that if as a result of a legal holiday an auction is held on the Friday
of the week preceding the Interest Reset Date, the related Interest
Determination Date shall be such preceding Friday; and provided, further, that
if an auction shall fall on any Interest Reset Date then the Interest Reset Date
shall instead be the first Business Day following such auction.
The "Calculation Date" pertaining to any Interest Determination Date
shall be the earlier of (i) the tenth calendar day after such Interest
Determination Date or, if such day is not a Business Day, the next succeeding
Business Day, or (ii) the Business Day next preceding the applicable Interest
Payment Date or Maturity Date, as the case may be.
All percentages resulting from any calculation on the Notes will be
rounded, if necessary, to the nearest one hundred-thousandth of a percentage
point, with five one-millionths of a percentage point rounded upward, and all
dollar amounts used in or resulting from such calculation on the Notes will be
rounded to the nearest cent (with one-half cent being rounded upward).
Determination of CD Rate. CD Rate means, with respect to an Interest
Determination Date (a "CD Rate Interest Determination Date"), the rate on such
CD Rate Interest Determination Date for
8
<PAGE>
negotiable certificates of deposit having the Index Maturity specified on the
face hereof, as such rate is published by the Board of Governors of the Federal
Reserve System (the "Federal Reserve Board") in "Statistical Release H.15(519),
Selected Interest Rates," or any successor publication of the Federal Reserve
Board ("H.15(519)"), under the heading "CDs (Secondary [Market)," or, if not so
published by 3:00 P.M., New York City time, on the Calculation Date pertaining
to such CD Rate Interest Determination Date, the CD Rate will be the rate on
such CD Rate Interest Determination Date for negotiable certificates of deposit
of the Index Maturity specified on the face hereof, as published by the Federal
Reserve Bank of New York in its daily statistical release "Composite 3:30 P.M.
Quotations for U.S. Government Securities" ("Composite Quotations") under the
heading "Certificates of Deposit." If such rate is not published in either
H.15(519) or the Composite Quotations by 3:00 P.M., New York City time, on such
Calculation Date, then the CD Rate on such CD Rate Interest Determination Date
will be calculated by the Calculation Agent and will be the arithmetic mean of
the secondary market offered rates as of 10:00 A.M., New York City time, on such
CD Rate Interest Determination Date, of three leading nonbank dealers in
negotiable U.S. dollar certificates of deposit in The City of New York selected
by the Calculation Agent for negotiable certificates of deposit of major United
States money center banks with a remaining maturity closest to the Index
Maturity specified on the face hereof in denominations of $5,000,000; provided,
however, that if the dealers selected as aforesaid by the Calculation Agent are
not quoting as set forth above, the CD Rate for such CD Rate Interest
Determination Date will be the CD Rate in effect on such CD Rate Interest
Determination Date.
Determination of Commercial Paper Rate. The Commercial Paper Rate
means, with respect to an Interest Determination Date (a "Commercial Paper Rate
Interest Determination Date"), the Money Market Yield (as defined below) of the
rate on such date for commercial paper having the Index Maturity specified on
the face hereof as published in H.15(519) under the heading "Commercial Paper."
In the event such rate is not published by 3:00 P.M., New York City time, on the
Calculation Date pertaining to such Commercial Paper Rate Interest Determination
Date, the Commercial Paper Rate shall be the Money Market Yield on such
Commercial Paper Rate Interest Determination Date of the rate for commercial
paper having the Index Maturity specified on the face hereof as published in
Composite Quotations under the heading "Commercial Paper." If such rate is not
published in either H.15(519) or Composite Quotations by 3:00 P.M., New York
City time, on such Calculation Date, the Commercial Paper Rate for that
Commercial Paper Rate Interest Determination Date shall be calculated by the
Calculation Agent and shall be the Money Market Yield of the arithmetic mean of
the offered rates as of 11:00 A.M., New York City time, on such Commercial Paper
Rate Interest Determination Date of three leading dealers of commercial paper
9
<PAGE>
in The City of New York selected by the Calculation Agent for commercial paper
of the Index Maturity specified on the face hereof placed for an industrial
issuer whose bond rating is "AA", or the equivalent, by a nationally recognized
securities rating agency; provided, however, that if the dealers selected as
aforesaid by the Calculation Agent are not quoting as set forth above, the
Commercial Paper Rate with respect to such Commercial Paper Rate Interest
Determination Date will be the Commercial Paper Rate then in effect on such
Commercial Paper Rate Interest Determination Date.
"Money Market Yield" shall be the yield (expressed as a percentage
rounded to the nearest one ten-thousandth of a percent, with five one
hundred-thousandths of a percent rounded upward) calculated in accordance with
the following formula:
D x 360
Money Market Yield =
360 - (D x M) x 100
where "D" refers to the per annum rate for commercial paper quoted on a bank
discount basis and expressed as a decimal, and "M" refers to the actual number
of days in the interest period for which interest is being calculated.
Determination of LIBOR. LIBOR means the rate determined by the
Calculation Agent in accordance with the following provisions:
(i) With respect to an Interest Determination Date (a "LIBOR
Interest Determination Date"), LIBOR will be "LIBOR Telerate" unless
"LIBOR Reuters" is specified on the face of this Note. "LIBOR Telerate"
is the rate for deposits in the LIBOR Currency (as defined below)
having the Index Maturity specified on the face hereof that appears on
the Designated LIBOR Page (as defined below) specified on the face
hereof as of 11:00 A.M. London time, on that LIBOR Interest
Determination Date. "LIBOR Reuters" is that rate which is the
arithmetic mean of the offered rates (unless the specified Designated
LIBOR Page by its terms provides only for a single rate, in which case
such single rate shall be used) for deposits in the LIBOR Currency
having the Index Maturity specified on the face hereof that appear on
the Designated LIBOR Page specified on the face hereof as of 11:00 A.M.
London time, on that LIBOR Interest Determination Date, if at least two
such offered rates appear (unless, as aforesaid, only a single rate is
required) on such Designated LIBOR Page. If LIBOR cannot be determined
under this clause (i), LIBOR in respect of the related LIBOR Interest
Determination Date will be determined as if the parties had specified
the rate described in clause (ii) below.
10
<PAGE>
(ii) With respect to a LIBOR Interest Determination Date on which
the applicable LIBOR rate cannot be determined under clause (i) above,
the Calculation Agent will request the principal London offices of each
of four major reference banks in the London interbank market, as
selected by the Calculation Agent to provide the Calculation Agent with
its offered quotation for deposits in the LIBOR Currency for the period
of the Index Maturity specified on the face hereof to prime banks in
the London interbank market commencing on the applicable Interest Reset
Date at approximately 11:00 A.M., London time, on such LIBOR Interest
Determination Date and in a principal amount that is representative for
a single transaction in such LIBOR Currency in such market at such
time. If at least two such quotations are provided, LIBOR determined on
such LIBOR Interest Determination Date will be the arithmetic mean of
such quotations. If fewer than two such quotations are provided, LIBOR
for such LIBOR Interest Determination Date will be the arithmetic mean
of the rates quoted at approximately 11:00 A.M. in the applicable
Principal Financial Center (as defined below), on such LIBOR Interest
Determination Date by three major banks in such Principal Financial
Center selected by the Calculation Agent for loans in the LIBOR
Currency to leading European banks, having the Index Maturity specified
on the face hereof commencing on the applicable Interest Reset Date and
in a principal amount that is representative for a single transaction
in such LIBOR Currency in such market at such time; provided, however,
that if the banks so selected by the Calculation Agent are not quoting
as mentioned in this sentence, LIBOR determined on such LIBOR Interest
determination Date will be LIBOR then in effect on such LIBOR Interest
Determination Date.
"LIBOR Currency" means the currency (including composite currencies)
specified on the face hereof for which LIBOR shall be calculated. If no such
currency is specified on the face hereof, the LIBOR Currency shall be U.S.
dollars.
"Designated LIBOR Page" means either (a) if "LIBOR Telerate" is
specified on the face hereof, the display on the Dow Jones Telerate Service for
the purpose of displaying the London interbank offered rates of major banks for
the applicable LIBOR Currency, or (b) if "LIBOR Reuters" is specified on the
face hereof, the display on the Reuters Monitor Money Rates Service for the
purpose of displaying the London interbank offered rates of major banks for the
applicable LIBOR Currency. If neither LIBOR Telerate nor LIBOR Reuters is
specified on the face hereof, LIBOR for the applicable LIBOR Currency will be
determined as if LIBOR Telerate (and, if the U.S. dollar is the LIBOR Currency,
Page 3750) had been specified.
"Principal Financial Center" shall generally be the capital city of the
country of the specified LIBOR Currency, except that
11
<PAGE>
with respect to U.S. dollars, Deutsche Marks and ECUs, the Principal Financial
Center shall be The City of New York, Frankfurt and Luxembourg, respectively.
Determination of Federal Funds Rate. The Federal Funds Rate means, with
respect to an Interest Determination Date (a "Federal Funds Rate Interest
Determination Date"), the rate on that date for Federal Funds as published in
H.15(519) under the heading "Federal Funds (Effective)." If H.15(519) is not so
published by 3:00 P.M., New York City time, on the Calculation Date pertaining
to such Federal Funds Rate Interest Determination Date, the Federal Funds Rate
will be the rate on such Federal Funds Rate Interest Determination Date as
published in Composite Quotations under the heading "Federal Funds/Effective
Rate." If such rate is not yet published in either H.15(519) or Composite
Quotations by 3:00 P.M., New York City time, on the Calculation Date pertaining
to such Federal Funds Rate Interest Determination Date, the Federal Funds Rate
for such Federal Funds Rate Interest Determination Date will be calculated by
the Calculation Agent and will be the arithmetic mean of the rates for the last
transaction in overnight Federal Funds as of 9:00 A.M., New York City time, on
such Federal Funds Rate Interest Determination Date quoted by each of three
leading brokers of Federal Funds transactions in The City of New York selected
by the Calculation Agent; provided, however, that if fewer than three such
brokers are so quoting such rates, the Federal Funds Rate with respect to such
Federal Funds Rate Interest Determination Date will be the Federal Funds Rate
then in effect on such Federal Funds Rate Interest Determination Date.
Determination of Prime Rate. Prime Rate means, with respect to an
Interest Determination Date (a "Prime Rate Interest Determination Date"), the
rate set forth on such date in H.15(519) under the heading "Bank Prime Loan," or
if not so published prior to 9:00 A.M. New York City time, on the Calculation
Date pertaining to such Prime Rate Interest Determination Date, then the Prime
Rate will be determined by the Calculation Agent and will be the arithmetic mean
of the rates of interest publicly announced by each bank that appears on the
Reuters Screen U.S. Prime 1 (as defined below) as such bank's prime rate or base
lending rates as in effect for that Prime Rate Interest Determination Date. If
fewer than four such rates but more than one such rate appear on the Reuters
Screen U.S. Prime 1 for the Prime Rate Interest Determination Date, the Prime
Rate will be determined by the Calculation Agent and will be the arithmetic mean
of the prime rates, quoted on the basis of the actual number of days in the year
divided by a 360-day year, as of the close of business on such Prime Rate
Interest Determination Date by four major money center banks in The City of New
York as selected by the Calculation Agent. If fewer than two such rates appear
on the Reuters Screen U.S. Prime 1, the Prime Rate will be determined by the
Calculation Agent as of the close of business on the Prime Rate Interest
Determination Date,
12
<PAGE>
on the basis of the prime rates, as of the close of business on the Prime Rate
Interest Determination Date, furnished in The City of New York by the
appropriate number of substitute banks or trust companies organized and doing
business under the laws of the United States, or any State thereof, having total
equity capital of at least $500 million and being subject to supervision or
examination by Federal or State authority, selected by the Calculation Agent to
provide such rate or rates; provided, however, that if the banks selected as
aforesaid are not quoting as mentioned in this sentence, the Prime Rate for such
Prime Rate Interest Determination Date will be the Prime Rate then in effect on
such Prime Rate Interest Determination Date.
"Reuters Screen U.S. Prime 1" means the display designated as page
"U.S. Prime 1" on the Reuters Monitor Money Rates Service (or such other page as
may replace the U.S. Prime 1 page on that service for the purpose of displaying
prime rates or base lending rates of major United States banks).
Determination of Treasury Rate. Treasury Rate means, with respect to an
Interest Determination Date (a "Treasury Rate Interest Determination Date"), the
rate for the auction held on such Treasury Rate Interest Determination Date of
direct obligations of the United States ("Treasury Bills") having the Index
Maturity specified on the face hereof, as published in H.15(519) under the
heading "U.S. Government Securities -- Treasury Bills -- auction average
(investment)." If such rate is not published by 3:00 P.M., New York City time,
on the Calculation Date pertaining to such Treasury Rate Interest Determination
Date, the Treasury Rate will be the auction average rate (expressed as a bond
equivalent on the basis of a year of 365 or 366 days, as applicable, and applied
on a daily basis) on such Treasury Rate Interest Determination Date as otherwise
announced by the United States Department of the Treasury. In the event that the
results of the auction of Treasury bills having the Index Maturity specified on
the face hereof are not reported as provided by 3:00 P.M., New York City time,
on such Calculation Date, or if no such auction is held on such Treasury Rate
Interest Determination Date, then the Treasury Rate for such Treasury Rate
Interest Determination Date shall be a yield to maturity (expressed as a bond
equivalent, on the basis of a year of 365 or 366 days, as applicable, and
applied on a daily basis) of the arithmetic mean of the secondary market bid
rates, as of approximately 3:30 P.M., New York City time, on such Treasury Rate
Interest Determination Date, of three leading primary United States government
securities dealers selected by the Calculation Agent, for the issue of Treasury
bills with a remaining maturity closest to the Index Maturity specified on the
face hereof; provided, however, that if the dealers selected as aforesaid by the
Calculation Agent are not quoting as mentioned in this sentence, the Treasury
Rate with respect to such Treasury Rate Interest Determination Date will be the
Treasury Rate then in effect on such Treasury Rate Interest Determination Date.
13
<PAGE>
Determination of CMT Rate. CMT Rate means with respect to an Interest
Determination Date relating to a CMT Rate Note or any Floating Rate Note for
which the interest rate is determined by reference to the CMT Rate (a "CMT Rate
Interest Determination Date"), the rate displayed on the designated CMT Telerate
Page under the caption "Treasury Constant Maturities . . . Federal Reserve Board
Release H.15 . . . Mondays approximately 3:45 p.m.," under the column for the
Designated CMT Maturity Index for (i) if the Designated CMT Telerate Page is
7055, the rate on such CMT Rate Interest Determination Date and (ii) if the
Designated CMT Telerate Page is 7052, the week, or the month, as applicable,
ended immediately preceding the week in which the Related CMT Rate Interest
Determination Date occurs. If such rate is no longer displayed on the relevant
page, or if not displayed by 3:00 p.m., New York City time, on the related
Calculation Date, then the CMT Rate for such CMT Rate Interest Determination
Date will be such Treasury Constant Maturity Rate for the Designated CMT
Maturity Index as published in the relevant H.15(519). If such rate is no longer
published, or if not published by 3:00 p.m. New York City time, on the related
Calculation Date, then the CMT Rate for such CMT Rate Interest Determination
Date will be such Treasury Constant Maturity Rate for the Designated CMT
Maturity Index (or other United States Treasury rate for the Designated CMT
Maturity Index) for the CMT Rate Interest Determination Date with respect to
such Interest Reset Date as may then be published by either the Board of
Governors of the Federal Reserve System or the United States Department of the
Treasury that the Calculation Agent determines to be comparable to the rate
formerly displayed on the Designated CMT Telerate Page and published in the
relevant H.15(519). If such information is not provided by 3:00 p.m., New York
City time, on the related Calculation Date, then the CMT Rate for the CMT Rate
Interest Determination Date will be calculated by the Calculation Agent and will
be a yield to maturity, based on the arithmetic mean of the secondary market
closing offer side prices as of approximately 3:30 p.m., New York City time, on
the CMT Interest Determination Date reported, according to their written
records, by three leading primary United States government securities dealers
(each a "Referenced Dealer") in The City of New York selected by the Calculation
Agent (from five such Referenced Dealers selected by the Calculation Agent and
eliminating the highest quotation (or, in the event of equality, one of the
highest) and the lowest quotation (or, in the event of equality, one of the
lowest)), for the most recently issued direct, non- callable fixed rate
obligations of the United States ("Treasury Note") with an original maturity of
approximately the Designated CMT Maturity Index and a remaining term to maturity
of not less than such Designated CMT Maturity Index minus one year. If the
Calculation Agent cannot obtain three such Treasury Note quotations, the CMT
Rate for such CMT Rate Interest Determination Date will be calculated by the
Calculation Agent and will be a yield to maturity based on the arithmetic mean
of the secondary market side offer prices as of approximately 3:30 p.m. New York
14
<PAGE>
City time, on the CMT Rate Interest Determination Date of three Referenced
Dealers in The City of New York (from five such Referenced Dealers selected by
the Calculation Agent and eliminating the highest quotation (or, in the even of
equality, one of the highest) and lowest quotation (or, in the event of
equality, one of the lowest)), for Treasury Notes with original maturity of the
number of years that is the next highest to the Designated CMT Maturity Index
and a remaining term to maturity closest to the Designated CMT Maturity Index
and in an amount of at least $100,000,000. If three or four (and not five) of
such Referenced Dealers are quoting as described above, then the CMT Rate will
be based on the arithmetic mean of the offer prices obtained and neither the
highest nor lowest of such quotes will be eliminated; provided however, that if
fewer than three Referenced Dealers selected by the Calculation Agent are
quoting as described herein, the CMT Rate will be the CMT Rate in effect on such
CMT Rate Interest Determination Date. If two Treasury Notes with an original
maturity as described in the third preceding sentence have remaining terms to
maturity equally close to the Designated CMT Maturity Index, the quotes for the
Treasury Rate Note with the shorter remaining term to maturity will be used.
"Designated CMT Telerate Page" means the display on the Dow Jones
Telerate Service on the page designated on the face of this Note (or any other
page as may replace such page on that service for the purpose of displaying
Treasury Constant Maturities as reported in H.15(519)), or the purpose of
displaying Treasury Constant Maturity as reported in H.15(519). If no such page
is specified, the Designated CMT Telerate Page shall be 7052, for the most
recent week.
"Designated CMT Maturity Index" means the original period to maturity
of the U.S. Treasury Securities (either 1, 2, 3, 5, 7, 10, 20 or 30 years)
specified on the fact of this Note with respect to which the CMT Rate will be
calculated. If no such maturity is specified on the face of this Note, the
Designated CMT Maturity Index shall be two years.
Determination of Eleventh District Cost of Funds Rate. Eleventh
District Cost of Funds Rate means, with respect to an Interest Determination
Date relating to an Eleventh District Cost of Funds Rate (an "Eleventh District
Cost of Funds Rate Interest Determination Date"), the rate equal to the monthly
weighted average cost of funds for the calendar month preceding such Eleventh
District Cost of Funds Rate Interest Determination Date as set forth under the
caption "Eleventh District" on Telerate page 7058 as of 11:00 a.m., San
Francisco time, on such Eleventh District Cost of Funds Rate Interest
Determination Date. If such rate does not appear on the Telerate page 7058 on
any related Eleventh District Cost of Funds Rate Interest Determination Date,
the Eleventh District Cost of Funds Rate for such Eleventh District Cost of
Funds Rate Interest Determination Date shall be
15
<PAGE>
the monthly weighted average cost of funds paid by member institutions of the
Eleventh Federal Home Loan Bank District that was most recently announced (the
"Index") by the FHLB of San Francisco as such cost of funds for the calendar
month preceding the date of such announcement. If the FHLB of San Francisco
fails to announce such rate for the calendar month next preceding such Eleventh
District Cost of Funds Rate Interest Determination Date, then the Eleventh
District Cost of Funds Rate for such Eleventh District Cost of Funds Rate
Interest Determination Date will be the Eleventh District Cost of Funds Rate in
effect on such Eleventh District Cost of Funds Rate Interest Determination Date.
"Telerate Page 7058" means the display on the Dow Jones Telerate Service on such
page (or such other page as may replace such page on the service for the purpose
of displaying the Eleventh District Cost of Funds Rate) for the purpose of
displaying the monthly average cost of the funds paid by member institutions of
the Eleventh Federal Home Loan Bank District.
Notwithstanding the foregoing, the interest rate hereon shall not be
greater than the Maximum Interest Rate, if any, or less than the Minimum
Interest Rate, if any, specified on the face hereof. The Calculation Agent shall
calculate the interest rate hereon in accordance with the foregoing on or before
each Calculation Date. The interest rate on this Note will in no event be higher
than the maximum rate permitted by New York law, as the same may be modified by
United States law of general application.
At the request of the holder hereof, the Calculation Agent will provide
to the holder hereof the interest rate hereon then in effect and, if determined,
the interest rate which will become effective as of the next Interest Reset
Date.
[The provisions of Article Fourteen of the Indenture do not
apply to Securities of this Series.]
If an Event of Default (defined in the Indenture as (i) the
Corporation's failure to pay principal of (or premium, if any, on) the Notes
when due, or to pay interest on the Notes within 30 days after the same becomes
due, (ii) the Corporation's breach of its other covenants contained in this Note
or the Indenture, which breach is not cured within 90 days after written notice
by the Trustee or the holders of at least 25% in outstanding principal amount of
all Securities issued under the Indenture and affected thereby, and (iii)
certain events involving the bankruptcy, insolvency or liquidation of the
Corporation) shall occur with respect to the Notes, the principal of all the
Notes may be declared due and payable in the manner and with the effect provided
in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Corporation and the rights of the
16
<PAGE>
holders of the Notes under the Indenture at any time by the Corporation with the
consent of the holders of not less than 66 2/3% in aggregate principal amount of
the Notes then outstanding and all other Securities then outstanding under the
Indenture and affected by such amendment and modification. The Indenture also
contains provisions permitting the holders of a majority in aggregate principal
amount of the Notes then outstanding and all other Securities then outstanding
under the Indenture and affected thereby, on behalf of the holders of all
Securities, to waive compliance by the Corporation with certain provisions of
the Indenture and certain past defaults under the Indenture and their
consequences. Any such consent or waiver by the holder of this Note shall be
conclusive and binding upon such holder and upon all future holders of this Note
and of any Note issued upon the registration of transfer hereof or in exchange
herefor or in lieu hereof whether or not notation of such consent or waiver is
made upon this 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 Corporation, which
is absolute and unconditional, to pay the principal of and interest on this Note
at the times, place and rate, and in the coin or currency, herein prescribed.
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 or any indenture supplemental
thereto, against any incorporator, stockholder, officer or director, as such,
past, present or future, of the Corporation or 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 issue
hereof, expressly waived and released.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Note may be registered on the registry books of
the Corporation relating to the Notes, upon surrender of this Note for
registration of transfer at the office or agency of the Corporation designated
by it pursuant to the Indenture, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Corporation and the Trustee
or Security Registrar duly executed by, the 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, will be issued to the
designated transferee or transferees.
The Notes are issuable only as registered Notes without coupons in
denominations of $1,000 and any integral multiple thereof. As provided in the
Indenture, and subject to certain
17
<PAGE>
limitations therein set forth, Notes are exchangeable for a like aggregate
principal amount of Notes of different authorized denominations, as requested by
the holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange, but the Corporation may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment for registration of transfer of this Note, the
Corporation, the Trustee, the Issuing and Paying Agent and any agent of the
Corporation, the Trustee or any Issuing and Paying Agent may treat the entity in
whose name this Note is registered as the absolute owner hereof for the purpose
of receiving payment as herein provided and for all other purposes, whether or
not this Note be overdue, and neither the Corporation, the Trustee, the Issuing
and Paying Agent nor any such agent shall be affected by notice to the contrary.
All terms used in this Note which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
If the Notes are to be issued and outstanding pursuant to a book-entry
system, the following paragraph is applicable: The Notes are being issued by
means of a book-entry system with no physical distribution of certificates to be
made except as provided in the Indenture. The book-entry system maintained by
The Depository Trust Company ("DTC") will evidence ownership of the Notes, with
transfers of ownership effected on the records of DTC and its participants
pursuant to rules and procedures established by DTC and its participants. The
Corporation will recognize Cede & Co., as nominee of DTC, while the registered
owner of the Notes, as the owner of the Notes for all purposes, including
payment of principal and interest, notices and voting. Transfer of principal and
interest to participants of DTC will be the responsibility of DTC, and transfer
of principal and interest to beneficial owners of the Notes by participants of
DTC will be the responsibility of such participants and other nominees of such
beneficial owners. [So long as the book-entry system is in effect, the selection
of any Notes to be redeemed will be determined by DTC pursuant to rules and
procedures established by DTC and its participants.] The Corporation will not be
responsible or liable for such transfers or payments or for maintaining,
supervising or reviewing the records maintained by DTC, its participants or
persons acting through such participants.
If the Notes may be settled through depositories located in Europe, the
following paragraph is applicable: Transfers of Notes in Europe may be effected
through the facilities of Cedel Bank, societe anonyme, and Morgan Guaranty Trust
Company of New York, Brussels office, as operator of the Euroclear system, in
18
<PAGE>
accordance with the rules and procedures established by such depositories.
19
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of the within Note, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM--as tenants in common
TEN ENT--as tenants by the entireties
JT TEN-- as joint tenants with right of survivorship
and not as tenants in common
UNIF GIFT MIN ACT--.............Custodian..........
(Cust) (Minor)
Under Uniform Gifts to Minors Act
.................................
(State)
Additional abbreviations may also be used though not in the above list.
____________________________________
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
[PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS
INCLUDING ZIP CODE OF ASSIGNEE]
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
Please Insert Social Security or Other
Identifying Number of Assignee: ____________________________
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing __________________________________ Attorney to transfer said Note on
the books of the Corporation, with full power of substitution in the premises.
Dated:_________________________ _________________________
NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Note in every particular, without alteration
or enlargement or any change whatever and must be guaranteed.
20
<PAGE>
[OPTION TO ELECT REPAYMENT]
The undersigned hereby irrevocably request(s) and instruct(s) the
Corporation to repay this Note (or portion hereof specified below) pursuant to
its terms at a price equal to the principal amount hereof together with interest
to the repayment date, to the undersigned, at ________________________________
________________________________________________________________
(Please print or typewrite name and address of the undersigned)
For this Note to be repaid, the Trustee (or the Paying Agent on behalf
of the Trustee) must receive at ______________, or at such other place or places
of which the Corporation shall from time to time notify the Holder of this Note,
not more than 60 nor less than 30 days prior to an Optional Repayment Date, if
any, shown on the face of this Note, this Note with this "Option to Elect
Repayment" form duly completed.
If less than the entire principal amount of this Note is to be repaid,
specify the portion hereof (which shall be in increments of $1,000) which the
Holder elects to have repaid and specify the denomination or denominations
(which shall be $__________ or an integral multiple of $1,000 in excess of
$__________) of the Notes to be issued to the Holder for the portion of this
Note not being repaid (in the absence of any such specification, one such Note
will be issued for the portion not being repaid).
$_______________________ ________________________________
NOTICE: The signature on this
Option to Elect Repayment must
Date _______________ correspond with the name as written
upon the face of this Note in every
particular, without alteration or
enlargement or any change whatever.]
21
<PAGE>
RENEWABLE NOTE RIDER
The Corporation and the purchaser of this Note have agreed that this
Note is a Renewable Note which initially matures on the Stated Maturity Date
shown on the face of this Note. At each Renewal Date, the maturity of this Note
will be automatically extended to the corresponding New Maturity Date unless the
holder of this Note delivers a completed Extension Termination Notice to the
Trustee or the Paying Agent on behalf of the Trustee not less than 15 nor more
than 30 days prior to the applicable Renewal Date. The Extension Termination
Notice may specify all or a portion of the outstanding principal amount of the
Note so long as the principal amount of the Note remaining outstanding after
repayment is an integral multiple of $1,000. Upon timely delivery of such
Extension Termination Notice, the term of the principal amount of this Note
subject to such notice will be deemed automatically to mature on the Stated
Maturity Date or the then applicable New Maturity Date, as the case may be. The
remaining principal balance of such Note, if any, will be deemed to
automatically be extended to the corresponding New Maturity Date but in no
circumstances may such maturity be extended beyond the Final Maturity Date.
Notwithstanding any such extension, the interest rate applicable to this Note
will continue to be calculated as set forth in this Note.
STATED MATURITY DATE:_________________________________
FINAL MATURITY DATE:__________________________________
Renewal Date (s) New Maturity Date(s)
22
<PAGE>
EXTENDIBLE NOTE RIDER
The Corporation and the purchaser of this Note have agreed that this
Note is an Extendible Note, whereby the Corporation has the option to extend the
maturity of this Note by delivery to the Trustee (or any duly authorized Paying
Agent) of an Extendible Option Notice under the terms of this Note as
supplemented by this Extendible Note Rider.
Stated Maturity Date:
Final Maturity Date:
Extension Notice Extended
Due Date Maturity Date
The Corporation may exercise its option with respect to an Extendible
Note by delivery to the Trustee (or any duly appointed Paying Agent) of an
Extendible Option Notice at least 45 but not more than 60 days prior to the
Stated Maturity Date originally in effect with respect to such Note or, if the
Stated Maturity Date of such Note has already been extended, the Extended
Maturity Date then in effect. After such receipt and not later than 40 days
prior to the Stated Maturity Date or an Extended Maturity Date, as the case may
be (each, a "Maturity Date"), the Trustee (or any duly appointed Paying Agent)
will mail first class mail, postage prepaid, to the holder of such Extendible
Note a notice (the "Extension Notice") relating to such extension period (the
"Extension Period") setting forth (i) the election of the Corporation to extend
the maturity of such Extendible Note, (ii) the new Extended Maturity Date, (iii)
in the case of a Fixed Rate Note, the interest rate applicable to the Extension
Period or, in the case of a Floating Rate Note, the Spread and/or Spread
Multiplier applicable to the Extension Period, and (iv) the provisions, if any,
for redemption during the Extension Period, including the date or dates on
which, the period or periods during which and the price or prices at which such
redemption may occur during the Extension Period. Upon the mailing by the
Trustee (or any duly appointed Paying Agent) of an Extension Notice to the
holder of an Extendible Note, the maturity of such Note shall be extended
automatically as set forth in the Extension Notice, and, except as modified by
the Extension Notice and as described in the next paragraph, such Extendible
Note will have the same terms as prior to the mailing of such Extension Notice.
23
<PAGE>
Notwithstanding the foregoing, not later than 20 days prior to the
Maturity Date for an Extendible Note (or, if such date is not a Business Day, on
the immediately succeeding Business Day), the Corporation may, at its option,
revoke the interest rate, in the case of a Fixed Rate Note, or the Spread and/or
Spread Multiplier, in the case of a Floating Rate Note, provided for in the
Extension Notice and establish a higher interest rate, in the case of a Fixed
Rate Note, or a higher Spread and/or Spread Multiplier, in the case of a
Floating Rate Note, for the Extension period by mailing or causing the Trustee
(or any duly appointed Paying Agent) to mail notice of such higher interest rate
or higher Spread and/or Spread Multiplier, as the case may be, first class mail,
postage prepaid, to the holder of such Note. Such notice shall be irrevocable.
All Extendible Notes with respect to which the Maturity Date is extended will
bear such higher interest rate, in the case of a Fixed Rate Note, or higher
Spread and/or Spread Multiplier, in the case of a Floating Rate Note, for the
Extension Period.
If the Corporation elects to extend the maturity of an Extendible Note,
the holder of such Note will have the option to elect repayment of such Note by
the Corporation on the Maturity Date then in effect at a price equal to the
principal amount thereof plus any accrued and unpaid interest to such date. In
order for an Extendible Note to be so repaid on the Maturity Date, the
Corporation must receive, at least 15 days but not more than 30 days prior to
the Maturity Date then in effect with respect to the Note, (i) the Note with the
form "Option to Elect Repayment" on the reverse of the Note duly completed or
(ii) a telegram, telex, facsimile transmission or a letter from a member of a
national securities exchange, or the National Association of Securities Dealers,
Inc. or a commercial bank or trust company in the United States setting forth
the name of the holder of the Note, the principal amount of the Note, the
principal amount of the Note to be repaid, the certificate number or a
description of the tenor and terms of the Note, a statement that the option to
elect repayment is being exercised thereby and a guarantee that the Note to be
repaid, together with the duly completed form entitled "Option to Elect
Repayment" attached to the Note, will be received by the Trustee (or any duly
appointed Paying Agent) not later than the fifth Business Day after the date of
such telegram, telex, facsimile transmission or letter, provided, however, that
such telegram, telex, facsimile transmission or letter shall only be effective
if such Note and duly completed form are received by the Trustee (or any duly
appointed Paying Agent) by such fifth Business Day. Such option may be exercised
by the holder of an Extendible Note for less than the aggregate principal amount
of the Note then outstanding, provided that the principal amount of the Note
remaining outstanding after repayment is an integral multiple of $1,000.
24
<PAGE>
<PAGE>
[FORM OF SUBORDINATED REGISTERED NOTE]
If the registered owner of this Note is The Depository Trust Company or a
nominee thereof, this Note is a Global Security and the following legends are
applicable: THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY
OR A NOMINEE OF A DEPOSITORY. THIS SECURITY IS NOT EXCHANGEABLE FOR NOTES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE
EXCEPT 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 DEPOSITORY TO
A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY
OR ANOTHER NOMINEE OF THE DEPOSITORY) MAY BE REGISTERED EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the issuer or
its agent for registration of transfer, exchange or payment, and any certificate
issued is registered in the name of Cede & Co. or such other name as requested
by an authorized representative of DTC (and any payment
is made to Cede & Co.
or such other entity as is requested by an authorized representative of
DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as
the registered owner hereof,
Cede & Co., has an interest herein.
THIS NOTE IS NOT A SAVINGS ACCOUNT OR A 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.
REGISTERED $_______________
NUMBER R-______
Common Code No. _____________ CUSIP 638585 ___
ISIN ________________________
SEE REVERSE FOR CERTAIN DEFINITIONS
AND ADDITIONAL PROVISIONS
NATIONSBANK CORPORATION
______% SUBORDINATED NOTE, DUE ____
NATIONSBANK CORPORATION, a corporation duly organized and existing under
the laws of the State of North Carolina (herein called the "Corporation," which
term includes any successor corporation under the Indenture referred to on the
reverse hereof), for value received, hereby promises to pay to
, or registered assigns, the principal sum of _________________________ DOLLARS1
on _____________________, 19___,2 and to pay interest on said principal sum,
semi-annually3 in
- --------
1 This form provides for Notes denominated in, and principal and interest
payable in, United States dollars. The form, as used, may be modified to
provide, alternatively, for Notes denominated in, and principal and interest and
other amounts, if any, payable in a foreign currency or currency unit, with the
specific terms and provisions, including any limitations on the issuance of
Notes in such currency, additional provisions regarding paying and other agents
and additional provisions regarding the calculation and payment of such
currency, set forth therein.
2 This form provides for Notes that will mature
only on a specified date. If the maturity of Notes of a series may be renewed at
the option of the holder, or extended at the option of the
(continued...)
<PAGE>
arrears on ____________________ and ___________________ of each year,
commencing __________, at the
rate of ___% per annum4, from the ____________ or ____________, as the case may
be, next preceding the date of this Note to which interest has been paid, unless
the date hereof is a date to which interest has been paid, in which case from
the date of this Note, or unless no interest has been paid on the Notes, in
which case from ________________________, until payment of such principal sum
has been made or duly provided for. Notwithstanding the foregoing, if the date
hereof is after a record date for the Notes (which shall be the close of
business on the [last] [fifteenth] day of the calendar month next preceding an
interest payment date) and before the next succeeding interest payment date,
this Note shall bear interest from such interest payment date; provided,
however, that if the Corporation shall default in the payment of interest due on
such interest payment date, then this Note shall bear interest from the next
preceding interest payment date to which interest has been paid, or, if no
interest has been paid on the Notes, from __________________. The interest so
payable, and punctually paid or duly provided for, on any interest payment date
will, as provided in such Indenture, be paid to the person in whose name this
Note (or one or more predecessor Notes evidencing all or a portion of the same
debt as this Note) is registered at the close of business on the record date for
such interest payment date. The principal of and interest on this Note are
payable in such coin or currency of the United States of America as at the time
of payment is legal tender for payment of public and private debts, at the
office or agency of the Corporation in __________________ or such other places
that the Corporation shall designate as provided in such Indenture; provided,
however, that interest may be paid, at the option of the Corporation, by check
mailed to the person entitled thereto at his address last appearing on the
Security Register of the Corporation relating to the Notes. Any interest not
punctually paid or duly provided for shall be payable as provided in such
Indenture.5
- --------
2 (...continued)
Corporation, the form, as used, will be modified to provide for additional terms
relating to such renewal or extension, as the case may be, including the period
or periods for which the maturity may be renewed or extended, as the case may
be, changes in the interest rate, if any, and requirements for notice.
3 This form provides for semi-annual interest payments. The form, as used, may
be modified to provide, alternatively, for annual, quarterly or other periodic
interest payments.
4 This form provides for interest at a fixed rate. The form, as used, may be
modified to provide, alternatively, for interest at a variable rate or rates,
with the method of determining such rate set forth therein.
5 This form does not contemplate the offer of Notes to United States Aliens (for
United States federal income tax purposes). If Notes are offered to United
States Aliens, the form of Note, as used, may be modified to provide for the
payment of additional amounts to such United States Aliens or, if applicable,
the redemption of such Notes in lieu of payment of such additional amounts.
2
<PAGE>
Reference is made to the further provisions of this Note set forth on
the reverse hereof, which shall have the same effect as though fully set forth
at this place.
Unless the certificate of authentication hereon has been executed by or
on behalf of the Trustee or an authenticating agent on behalf of the Trustee by
manual signature, this Note shall not be entitled to any benefit under such
Indenture, or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Corporation has caused this instrument to be
duly executed by manual or facsimile signature under its corporate seal or a
facsimile thereof.
NATIONSBANK CORPORATION
Attest:
By:
Secretary [Title: ]
[CORPORATE SEAL]
Dated
3
<PAGE>
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
THE BANK OF NEW YORK, as Trustee,
Dated:_____________________ [By: ,
as Authenticating Agent]
By:
Authorized Signatory
4
<PAGE>
[Reverse Side of Note]
NATIONSBANK CORPORATION
______% SUBORDINATED NOTE, DUE __________
This Note is one of a duly authorized series of Securities of the
Corporation unlimited in aggregate principal amount issued and to be issued
under an Indenture dated as of January 1, 1995 (herein called the "Indenture")
between the Corporation and The Bank of New York, as Trustee
(herein called the "Trustee,"
which term includes any successor trustee under the Indenture), to which
Indenture and all indentures supplemental thereto reference is hereby made for a
statement of the respective rights thereunder of the Corporation, the Trustee
and the holders of the Notes, and the terms upon which the Notes are, and are to
be, authenticated and delivered. This Note is also one of the Notes designated
as the Corporation's _____% Subordinated Notes, due __________ (herein called
the "Notes"), limited in aggregate principal amount to $__________.
[The Trustee initially shall act as
Registrar, Authenticating and Paying Agent in connection with the Notes.]
THE INDEBTEDNESS OF THE CORPORATION EVIDENCED BY THE NOTES, INCLUDING
THE PRINCIPAL THEREOF AND INTEREST THEREON, IS, TO THE EXTENT AND IN THE MANNER
SET FORTH IN THE INDENTURE, SUBORDINATE AND JUNIOR IN RIGHT OF PAYMENT TO ITS
OBLIGATIONS TO HOLDERS OF SENIOR INDEBTEDNESS, AS DEFINED IN THE INDENTURE, AND
EACH HOLDER OF THE NOTES, BY THE ACCEPTANCE THEREOF, AGREES TO AND SHALL BE
BOUND BY SUCH PROVISIONS OF THE INDENTURE.
[Except as otherwise provided herein,] the Notes of this series are not
subject to redemption at the option of the Corporation or repayment at the
option of the holder prior to maturity.6
[The provisions of Article Fourteen of the Indenture do not apply to
Securities of this series.]
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Note may be registered on the Security Register
of the Corporation relating to the Notes, upon surrender of this Note for
registration of transfer at the office or agency of the Corporation designated
by it pursuant to the Indenture, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Corporation and the Trustee
or the Security Registrar duly executed by, the registered holder hereof or his
attorney duly authorized in
- --------
6 This form provides for Notes that are not subject to redemption at the option
of the Corporation or repayment at the option of the holder. The form, as used,
may be modified to provide, alternatively, for redemption at the option of the
Corporation or repayment at the option of the holder, with the terms and
conditions of such redemption or repayment, as the case may be, including
provisions regarding sinking funds, if applicable, redemption prices and notice
periods, set forth therein.
5
<PAGE>
writing, and thereupon one or more new Notes, of authorized denominations and
for the same aggregate principal amount, will be issued to the designated
transferee or transferees.
The Notes are issuable only as registered Notes without coupons in the
denominations of $______ and any integral multiple in excess thereof. As
provided in the Indenture, and subject to certain limitations therein set forth,
Notes are exchangeable for a like aggregate principal amount of Notes of
different authorized denominations, as requested by the holder surrendering the
same.
If any interest payment date or maturity date for a Note falls on a day
that is not a Business Day, the interest payment date or maturity date will be
the following day that is a Business Day and the payment of interest or
principal will be made on such next Business Day as if it were made on the date
such payment was due and no additional interest will accrue on the amount so
payable for the period from and after such interest payment date or maturity
date.
No service charge will be made for any such registration of transfer or
exchange, but the Corporation may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment for registration of transfer of this Note, the
Corporation, the Trustee and any agent of the Corporation or the Trustee may
treat the person in whose name this Note is registered as the absolute owner
hereof for the purpose of receiving payment as herein provided and for all other
purposes, whether or not this Note be overdue, and neither the Corporation, the
Trustee nor any such agent shall be affected by notice to the contrary.
If an Event of Default (defined in the Indenture as certain events
involving the bankruptcy of the Corporation) shall occur with respect to the
Notes, the principal of all the Notes may be declared due and payable in the
manner and with the effect provided in the Indenture. THERE IS NO RIGHT OF
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Corporation and the rights of the holders of the Notes under the Indenture at
any time by the Corporation with the consent of the holders of not less than
66-2/3% in aggregate principal amount of the Notes then outstanding and all
other Securities then outstanding issued under the Indenture and affected by
such amendment and modification. The Indenture also contains provisions
permitting the holders of a majority in aggregate principal amount of the Notes
then outstanding and all other Securities then outstanding issued under the
Indenture and affected thereby, on behalf of the holders of all such Securities,
to waive compliance by the Corporation with certain provisions of the Indenture
and certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the holder of this Note shall be conclusive and binding
upon such holder and upon all future holders of this Note and of any Note issued
upon the registration of transfer hereof or in
6
<PAGE>
exchange herefor or in lieu
hereof whether or not 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 Corporation, which is
absolute and unconditional, to pay the principal of and interest on this Note at
the times, place and rate, and in the coin or currency, herein prescribed.
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 or any indenture supplemental
thereto, against any incorporator, stockholder, officer or director, as such,
past, present or future, of the Corporation or 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 issue
hereof, expressly waived and released.
The Notes of this series shall be dated the date of their
authentication.
All terms used in this Note which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
If the Notes are to be issued and outstanding pursuant to a book-entry
system, the following paragraph is applicable: The Notes are being issued by
means of a book-entry system with no physical distribution of certificates to be
made except as provided in the Indenture. The book-entry system maintained by
The Depository Trust Company ("DTC") will evidence ownership of the Notes, with
transfers of ownership effected on the records of DTC and its participants
pursuant to rules and procedures established by DTC and its participants. The
Corporation will recognize Cede & Co., as nominee of DTC, while the registered
owner of the Notes, as the owner of the Notes for all purposes, including
payment of principal and interest, notices and voting. Transfer of principal and
interest to participants of DTC will be the responsibility of DTC, and transfer
of principal and interest to beneficial owners of the Notes by participants of
DTC will be the responsibility of such participants and other nominees of such
beneficial owners. [So long as the book-entry system is in effect, the selection
of any Notes to be redeemed will be determined by DTC pursuant to rules and
procedures established by DTC and its participants.] The Corporation will not be
responsible or liable for such transfers or payments or for maintaining,
supervising or reviewing the records maintained by DTC, its participants or
persons acting through such participants.
If the Notes may be settled through depositories located in Europe, the
following paragraph is applicable: Transfers of Notes in Europe may be effected
through the facilities of Cedel Bank, societe anonyme, and Morgan Guaranty Trust
Company of New York, Brussels office, as operator of the Euroclear system, in
accordance with the rules and procedures established by such depositories.
----------
7
<PAGE>
The following abbreviations, when used in the inscription on the face of
the within Note, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and not as tenants
in common
UNIF GIFT MIN ACT -- _________ Custodian _________
(Cust) (Minor)
under Uniform Gifts to Minors
Act __________ (State)
Additional abbreviations may also be used though not in
the above list.
----------
FOR VALUE RECEIVED the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE
- --------------------------------------------------------------------
- --------------------------------------------------------------------
(Name and Address of Assignee, including zip code, must be
printed or typewritten.)
the within
Note, and all rights thereunder, hereby irrevocably constituting and appointing
Attorney
to transfer said Note on the books of the Corporation, with full power of
substitution in the premises.
Dated:
NOTICE: The signature to this assignment must correspond with the name
as it appears upon the face of the within Note in every particular, without
alteration or enlargement or any change whatever and must be guaranteed.
8
<PAGE>
If the registered owner of this Note is The Depository Trust Company or a
nominee thereof, this Note is a Global Security and the following legends are
applicable. THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY
OR A NOMINEE OF A DEPOSITORY. THIS SECURITY IS NOT EXCHANGEABLE FOR NOTES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE
EXCEPT 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 DEPOSITORY TO
A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY
OR ANOTHER NOMINEE OF THE DEPOSITORY) MAY BE REGISTERED EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the issuer or its
agent for registration of transfer, exchange or payment, and any certificate
issued is registered in the name of Cede & Co. or such other name as requested
by an authorized representative of DTC (and any payment is made to Cede & Co. or
such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.1
THIS NOTE IS NOT A SAVINGS ACCOUNT OR A 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.
REGISTERED
NUMBER FXR _________ $_______________
NATIONSBANK CORPORATION
MEDIUM-TERM SUBORDINATED NOTE,
SERICUSIP 63858S ________
(Fixed Rate)
ORIGINAL ISSUE DATE:
INTEREST RATE:
STATED MATURITY DATE:
FINAL MATURITY DATE:
INITIAL REDEMPTION DATE:
INITIAL REDEMPTION PERCENTAGE:
ANNUAL REDEMPTION PERCENTAGE:
PERCENTAGE REDUCTION:
OPTIONAL REPAYMENT DATE(S):
ADDITIONAL TERMS:
NationsBank Corporation, a corporation duly organized and existing
under the laws of the State of North Carolina (herein called the "Corporation,"
which term includes any successor corporation under the Indenture referred to on
the reverse hereof), for value received, hereby promises to pay to ________
- ---------------------------------------------------------------,
or registered assigns, the principal sum of ___________________ DOLLARS on the
Stated Maturity Date specified above (except to the extent redeemed or repaid
prior to the Stated Maturity Date), and to pay interest on said principal sum,
semiannually in arrears on ____________ and __________ of each year (each an
"Interest Payment Date"), at the Interest Rate per annum specified above, until
payment of such principal sum has been made or duly provided for, commencing on
the first Interest Payment Date next succeeding the Original Issue Date
specified above, unless the Original Issue Date occurs between a Regular Record
Date, as defined below, and the next succeeding Interest
________________
1 Applies only if this Note is a Global Note.
<PAGE>
Payment Date, in which case commencing on the Interest Payment Date following
the next succeeding Regular Record Date, and on the Stated Maturity Date or
Final Maturity Date shown above (or any Redemption Date as defined on the
reverse hereof or any Optional Repayment Date with respect to which any such
option has been exercised, each such Stated Maturity Date, Final Maturity Date,
Redemption Date and Optional Repayment Date being herein referred to as a
"Maturity Date" with respect to the principal payable on such date). Interest on
this Note will accrue from the Original Issue Date specified above until the
principal amount is paid and will be computed on the basis of a 360-day year of
twelve 30-day months. Interest payments will be in the amount of interest
accrued from and including the next preceding Interest Payment Date in respect
of which interest has been paid or duly provided for or, if no interest has been
paid, from the Original Issue Date specified above, to but excluding the
Interest Payment Date or Maturity Date, as the case may be. If the Maturity Date
or an Interest Payment Date falls on a day which is not a Business Day as
defined below, principal or interest payable with respect to such Maturity Date
or Interest Payment Date will be paid on the next succeeding Business Day with
the same force and effect as if made on such Maturity Date or Interest Payment
Date, as the case may be, and no additional interest shall accrue for the period
from and after such Maturity Date or Interest Payment Date. The interest so
payable, and punctually paid or duly provided for, on any Interest Payment Date
will be paid to the person in whose name this Note (or one or more predecessor
Notes evidencing all or a portion of the same debt as this Note) is registered
at the close of business on the Regular Record Date, which shall be the
__________ or the __________, whether or not a Business Day, as the case may be,
next preceding such Interest Payment Date; provided, however, that the first
payment of interest on any Note with an Original Issue Date, as specified above,
between a Regular Record Date and an Interest Payment Date or on an Interest
Payment Date will be made on the Interest Payment Date following the next
succeeding Regular Record Date to the person in whose name this Note is
registered at the close of business on such next succeeding Regular Record Date;
and provided, further, that interest payable on the Maturity Date will be
payable to the person to whom the principal hereof shall be payable. Any
interest not punctually paid or duly provided for shall be payable as provided
in the Indenture. As used herein, "Business Day" means any day, other than a
Saturday or Sunday or a legal holiday in New York, New York or Charlotte, North
Carolina that is not a day on which banks in New York, New York, Charlotte,
North Carolina or ____________________ are authorized or required by law or
regulation to be closed.
The principal of and interest on this Note are payable in immediately
available funds in such coin or currency of the United States of America as at
the time of payment is legal tender for payment of public and private debts at
the office or
2
<PAGE>
agency of the Corporation designated as provided in the Indenture; provided,
however, that interest may be paid, at the option of the Corporation, by check
mailed to the person entitled thereto at his address last appearing on the
registry books of the Corporation relating to the Notes. Notwithstanding the
preceding sentence, payments of principal of and interest payable on the
Maturity Date will be made by wire transfer of immediately available funds to a
designated account maintained in the United States upon (i) receipt of written
notice by the Issuing and Paying Agent from the holder hereof not less than one
Business Day prior to the due date of such principal and (ii) presentation of
this Note to the Issuing and Paying Agent at [The Bank of New York as Issuing
and Paying Agent at 101 Barclay Street, New York, New York 10286] (the
"Corporate Trust Office").
Reference is made to the further provisions of this Note set forth on
the reverse hereof, which shall have the same effect as though fully set forth
at this place.
Unless the certificate of authentication hereon has been executed by
the Trustee or an Authenticating Agent on behalf of the Trustee by manual
signature, this Note shall not be entitled to any benefit under such Indenture
or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Corporation has caused this Instrument to be
duly executed, by manual or facsimile signature, under its corporate seal or a
facsimile thereof.
NATIONSBANK CORPORATION
By: ______________________
[SEAL] Title: ___________________
ATTEST:
By: _________________________
________________ Secretary
3
<PAGE>
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: _____________________,
as Authenticating Agent]
By: _________________________
Authorized Signatory
4
<PAGE>
[Reverse of Note]
NATIONSBANK CORPORATION
MEDIUM-TERM SUBORDINATED NOTE,
SERIES ___
(Fixed Rate)
This Medium-Term Note is one of a duly authorized series of Securities
of the Corporation unlimited in aggregate principal amount (herein called the
"Notes") issued and to be issued under an Indenture dated as of January 1, 1995
(herein called the "Indenture"), between the Corporation and The Bank of New
York, as Trustee (herein called the "Trustee," which term includes any successor
trustee under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights
thereunder of the Corporation, the Trustee and the holders of the Notes, and the
terms upon which the Notes are, and are to be, authenticated and delivered. This
Note is also one of the Notes designated as the Corporation's Subordinated
Medium-Term Notes, Series ___ (herein called the "Notes"), limited in aggregate
principal amount to [$_____________]. The Notes may bear different dates, mature
at different times, bear interest at different rates and vary in such other ways
as are provided in the Indenture.
THE INDEBTEDNESS OF THE CORPORATION EVIDENCED BY THE NOTES, INCLUDING
THE PRINCIPAL THEREOF AND INTEREST THEREON, IS, TO THE EXTENT AND IN THE MANNER
SET FORTH IN THE INDENTURE, SUBORDINATE AND JUNIOR IN RIGHT OF PAYMENT TO ITS
OBLIGATIONS TO HOLDERS OF SENIOR INDEBTEDNESS, AS DEFINED IN THE INDENTURE, AND
EACH HOLDER OF THE NOTES, BY THE ACCEPTANCE HEREOF, AGREES TO AND SHALL BE BOUND
BY SUCH PROVISIONS OF THE INDENTURE.
This Note is not subject to any sinking fund.
This Note may be subject to repayment at the option of the holder on
the Optional Repayment Date(s), if any, indicated on the face hereof. IF NO
OPTIONAL REPAYMENT DATES ARE SET FORTH ON THE FACE HEREOF, THIS NOTE MAY NOT BE
SO REPAID AT THE OPTION OF THE HOLDER HEREOF PRIOR TO THE STATED MATURITY DATE.
On any Optional Repayment Date this Note shall be repayable in whole or in part
in increments of $1,000 at the option of the holder hereof at a repayment price
equal to 100% of the principal amount to be repaid, together with interest
thereon payable to the date of repayment. For this Note to be repaid in whole or
in part at the option of the holder hereof, this Note must be received, with the
form entitled "Option to Elect Repayment" below duly completed, by the Issuing
and Paying Agent at the Corporate Trust Office, or such other address of which
the Corporation shall from time to time notify the holders of the Notes, not
more than 60 nor less than 30 days prior to an Optional Repayment Date. Exercise
of such repayment option by the holder hereof shall be irrevocable.
5
<PAGE>
This Note may be redeemed at the option of the Corporation on any date
on and after the Initial Redemption Date, if any, specified on the face hereof
(the "Redemption Date"). IF NO INITIAL REDEMPTION DATE IS SET FORTH ON THE FACE
HEREOF, THIS NOTE MAY NOT BE REDEEMED AT THE OPTION OF THE CORPORATION PRIOR TO
THE STATED MATURITY DATE. On and after the Initial Redemption Date, if any, this
Note may be redeemed at any time in whole or from time to time in part in
increments of $1,000 at the option of the Corporation at the applicable
Redemption Price (as defined below) together with interest thereon payable to
the Redemption Date, on notice given not more than 60 nor less than 30 days
prior to the Redemption Date. In the event of redemption of this Note in part
only, a new Note for the unredeemed portion hereof shall be issued in the name
of the holder hereof upon the surrender hereof.
If this Note is redeemable at the option of the Corporation, the
"Redemption Price" shall initially be the Initial Redemption Percentage,
specified on the face hereof, of the principal amount of this Note to be
redeemed and shall decline at each anniversary of the Initial Redemption Date by
the Annual Redemption Percentage Reduction, if any, specified on the face
hereof, of the principal amount to be redeemed until the Redemption Price is
100% of such principal amount.
[The provisions of Article Fourteen of the Indenture do not
apply to Securities of this Series.]
If an Event of Default (defined in the Indenture as certain events
involving the bankruptcy of the Corporation) shall occur with respect to the
Notes, the principal of all the Notes may be declared due and payable in the
manner and with the effect provided in the Indenture. THERE IS NO RIGHT OF
ACCELERATION PROVIDED IN THE INDENTURE IN CASE OF A DEFAULT IN THE PAYMENT OF
INTEREST OR THE PERFORMANCE OF ANY OTHER COVENANT BY THE CORPORATION.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Corporation and the rights of the holders of the Notes under the Indenture at
any time by the Corporation with the consent of the holders of not less than 66
2/3% in aggregate principal amount of the Notes then outstanding and all other
Securities then outstanding under the Indenture and affected by such amendment
and modification. The Indenture also contains provisions permitting the holders
of a majority in aggregate principal amount of the Notes then outstanding and
all other Securities then outstanding under the Indenture and affected thereby,
on behalf of the holders of all such Securities, to waive compliance by the
Corporation with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by
6
<PAGE>
the holder of this Note shall be conclusive and binding upon such holder and
upon all future holders of this Note and of any Note issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof whether
or not notation of such consent or waiver is made upon this 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 Corporation, which
is absolute and unconditional, to pay the principal of and interest on this Note
at the times, place and rate, and in the coin or currency, herein prescribed.
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 or any indenture supplemental
thereto, against any incorporator, stockholder, officer or director, as such,
past, present or future, of the Corporation or 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 issue
hereof, expressly waived and released.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Note may be registered on the registry books of
the Corporation relating to the Notes, upon surrender of this Note for
registration of transfer at the office or agency of the Corporation designated
by it pursuant to the Indenture, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Corporation and the Trustee
or the Security Registrar duly executed by, the 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, will be issued to the
designated transferee or transferees.
The Notes are issuable only as registered Notes without coupons in
denominations of $1,000 and any integral multiple thereof. As provided in the
Indenture, and subject to certain limitations therein set forth, Notes are
exchangeable for a like aggregate principal amount of Notes of different
authorized denominations, as requested by the holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange, but the Corporation may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment for registration of transfer of this Note, the
Corporation, the Trustee, the Issuing and Paying Agent and any agent of the
Corporation, the Trustee or the
7
<PAGE>
Issuing and Paying Agent may treat the entity in whose name this Note is
registered as the absolute owner hereof for the purpose of receiving payment as
herein provided and for all other purposes, whether or not this Note be overdue,
and neither the Corporation, the Trustee, the Issuing and Paying Agent nor any
such agent shall be affected by notice to the contrary.
All terms used in this Note which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
If the Notes are to be issued and outstanding pursuant to a book-entry
system, the following paragraph is applicable: The Notes are being issued by
means of a book-entry system with no physical distribution of certificates to be
made except as provided in the Indenture. The book-entry system maintained by
The Depository Trust Company ("DTC") will evidence ownership of the Notes, with
transfers of ownership effected on the records of DTC and its participants
pursuant to rules and procedures established by DTC and its participants. The
Corporation will recognize Cede & Co., as nominee of DTC, while the registered
owner of the Notes, as the owner of the Notes for all purposes, including
payment of principal and interest, notices and voting. Transfer of principal and
interest to participants of DTC will be the responsibility of DTC, and transfer
of principal and interest to beneficial owners of the Notes by participants of
DTC will be the responsibility of such participants and other nominees of such
beneficial owners. [So long as the book-entry system is in effect, the selection
of any Notes to be redeemed will be determined by DTC pursuant to rules and
procedures established by DTC and its participants.] The Corporation will not be
responsible or liable for such transfers or payments or for maintaining,
supervising or reviewing the records maintained by DTC, its participants or
persons acting through such participants.
If the Notes may be settled through depositories located in Europe, the
following paragraph is applicable: Transfers of Notes in Europe may be effected
through the facilities of Cedel Bank, societe anonyme, and Morgan Guaranty Trust
Company of New York, Brussels office, as operator of the Euroclear system, in
accordance with the rules and procedures established by such depositories.
8
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of the within Note shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM-- as tenants in common
TEN ENT-- as tenants by the entireties
JT TEN-- as joint tenants with right of survivorship
and not as tenants in common
UNIF GIFT MIN ACT--..........Custodian...........
(Cust) (Minor)
Under Uniform Gifts to Minors Act
.................................
(State)
Additional abbreviations may also be used though not in the above list.
----------------------------------
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s),
assign(s) and transfer(s) unto
[PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS
INCLUDING ZIP CODE, OF ASSIGNEE]
- -----------------------------------------------------------------
- -----------------------------------------------------------------
- -----------------------------------------------------------------
Please Insert Social Security or Other
Identifying Number of Assignee: ________________________
the within Note and all rights thereunder, hereby irrevocably
constituting and appointing
_____________________________________ Attorney to transfer said Note on the
books of the Corporation, with full power of substitution in the premises.
Dated: ________________________ _________________________
NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Note in every particular, without alteration
or enlargement or any change whatever and must be guaranteed.
9
<PAGE>
[OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably request(s) and instruct(s) the
Corporation to repay this Note (or portion hereof specified below) pursuant to
its terms at a price equal to the principal amount hereof together with interest
to the repayment date, to the undersigned, at _________________________________
(Please print or typewrite name and address of the undersigned)
For this Note to be repaid, the Trustee (or the Paying Agent on behalf
of the Trustee) must receive at __________________, or at such other place or
places of which the Corporation shall from time to time notify the Holder of
this Note, not more than 60 nor less than 30 days prior to an Optional Repayment
Date, if any, shown on the face of this Note, this Note with this "Option to
Elect Repayment" form duly completed.
If less than the entire principal amount of this Note is to be repaid,
specify the portion hereof (which shall be in increments of $1,000) which the
Holder elects to have repaid and specify the denomination or denominations
(which shall be $__________ or an integral multiple of $l,000 in excess of
$__________) of the Notes to be issued to the Holder for the portion of this
Note not being repaid (in the absence of any such specification, one such Note
will be issued for the portion not being repaid).
$----------------------- ---------------------------------
NOTICE: The signature on this
Option to Elect Repayment must
correspond with the name as written
Date:________________ upon the face of this Note in
every particular, without alteration or
enlargement or any change
whatever.]
10
If the registered owner of this Note is The Depository Trust Company or a
nominee thereof, this Note is a Global Security and the following legends are
applicable: THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY
OR A NOMINEE OF A DEPOSITORY. THIS SECURITY IS NOT EXCHANGEABLE FOR NOTES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITORY OR ITS NOMINEE
EXCEPT 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 DEPOSITORY TO
A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY
OR ANOTHER NOMINEE OF THE DEPOSITORY) MAY BE REGISTERED EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the issuer or its
agent for registration of transfer, exchange or payment, and any certificate
issued is registered in the name of Cede & Co. or such other name as requested
by an authorized representative of DTC (and any payment is made to Cede & Co. or
such other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest
herein.1
THIS NOTE IS NOT A SAVINGS ACCOUNT OR A 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.
REGISTERED
NUMBER FLR _______ $_________
NATIONSBANK CORPORATION
MEDIUM-TERM SUBORDINATED NOTE, SERIES ___
(Floating Rate)
CUSIP 63858S _________
ORIGINAL ISSUE DATE: BASE RATE:
STATED MATURITY DATE: (check one)
FINAL MATURITY DATE: ___CD Rate
INITIAL INTEREST RATE: ___Commercial Paper Rate
INDEX MATURITY FOR INITIAL ___LIBOR ____________
INTEREST RATE (IF DIFFERENT): ___Federal Funds Rate
INDEX MATURITY: ___Prime Rate
INDEX MATURITY FOR FINAL ___Treasury Rate
INTEREST PAYMENT PERIOD ___CMT Rate
(IF DIFFERENT): CMT Telerate Page:____
SPREAD: CMT Maturity Index:___
SPREAD MULTIPLIER: ___Eleventh District Cost
MAXIMUM INTEREST RATE: of Funds Rate
MINIMUM INTEREST RATE: ___Other:________________
INTEREST PAYMENT DATES:
INTEREST RATE RESET DATES: [ ] This Note is a Renewable
INTEREST RATE RESET PERIOD: Note.
INITIAL REDEMPTION DATE: See Attached Rider.
INITIAL REDEMPTION PERCENTAGE:
ANNUAL REDEMPTION PERCENTAGE REDUCTION:
OPTIONAL PAYMENT DATE(S):
CALCULATION AGENT: [ ] This Note is an
ADDITIONAL TERMS: Extendible Note.
See Attached Rider.
NationsBank Corporation, a corporation duly organized and existing
under the laws of the State of North Carolina (herein called the "Corporation,"
which term includes any successor
________
1 Applies only if this Note is a Global Security.
<PAGE>
corporation under the Indenture referred to on the reverse hereof), for value
received, hereby promises to pay to
______________________________________________________________,
or registered assigns, the principal sum of ________________ DOLLARS on the
Stated Maturity Date specified above (except to the extent redeemed or repaid
prior to the Stated Maturity Date), and to pay interest thereon at a rate per
annum equal to the Initial Interest Rate specified above until the Initial
Interest Reset Date specified above and thereafter at a rate determined in
accordance with the provisions on the reverse hereof, depending upon the
appropriate Base Rate and Index Maturity specified above, until the principal
hereof is paid or duly made available for payment. The Corporation will pay
interest on the Interest Payment Dates specified above, commencing with the
first Interest Payment Date next succeeding the Original Issue Date specified
above, unless the Original Issue Date occurs between a Regular Record Date, as
defined below, and the next succeeding Interest Payment Date, in which case
commencing on the Interest Payment Date following the next succeeding Regular
Record Date, and on the Stated Maturity Date or Final Maturity Date shown above
(or any Redemption Date as defined on the reverse hereof or any Optional
Repayment Date with respect to which any such option has been exercised, each
such Stated Maturity Date, Final Maturity Date, Redemption Date and Optional
Repayment Date being herein referred to as a "Maturity Date" with respect to the
principal repayable on such date). Interest on this Note will accrue from the
Original Issue Date specified above until the principal amount is paid and will
be computed as hereinafter described. Interest payable on this Note on any
Interest Payment Date or the Maturity Date will include interest accrued from
and including the next preceding Interest Payment Date in respect of which
interest has been paid or duly provided for or, if no interest has been paid,
from the Original Issue Date specified above, to but excluding such Interest
Payment Date or Maturity Date, as the case may be; provided, however, that if
the Interest Rate Reset Period with respect to this Note is daily or weekly,
interest payable on any Interest Payment Date or the Maturity Date will include
interest accrued from but excluding the Regular Record Date through which
interest has been paid to and including the Regular Record Date next preceding
such Interest Payment Date, except that interest payable on any such Maturity
Date will include interest accrued to, but excluding, such Maturity Date. If any
Interest Payment Date falls on a day which is not a Business Day, as defined
below, such Interest Payment Date shall be the following day that is a Business
Day, except that if the Base Rate is LIBOR, if such next Business Day falls in
the next succeeding calendar month, such Interest Payment Date will be the
preceding day that is a Business Day; and if the Maturity Date falls on a day
which is not a Business Day, principal or interest payable with respect to such
Maturity Date will be paid on the next succeeding Business Day with the same
force and effect as if made on such Maturity Date, and no additional interest
shall accrue for the period from and after such Maturity Date. The
2
<PAGE>
interest so payable, and punctually paid or duly provided for, on any Interest
Payment Date will be paid to the person in whose name this Note (or one or more
predecessor Notes evidencing all or a portion of the same debt as this Note) is
registered at the close of business on the date 15 calendar days prior to such
Interest Payment Date, whether or not a Business Day (the "Regular Record
Date"); provided, however, that the first payment of interest on any Note with
an Original Issue Date, as specified above, between a Regular Record Date and an
Interest Payment Date or on an Interest Payment Date will be made on the
Interest Payment Date following the next succeeding Regular Record Date to the
person in whose name this Note is registered at the close of business on such
next succeeding Regular Record Date; and provided, further, that interest
payable on the Maturity Date will be payable to the person to whom the principal
hereof shall be payable. Any such interest not punctually paid or duly provided
for shall be payable as provided in the Indenture. As used herein, "Business
Day" means any day, other than a Saturday or Sunday or a legal holiday in New
York, New York or Charlotte, North Carolina, that is not a day on which banking
institutions in New York, New York, Charlotte, North Carolina or ___________ are
authorized or required by law or regulation to be closed and (ii) if the Base
Rate is LIBOR, is a day on which dealings in deposits on U.S. dollars are
transacted in the London interbank market.
The principal of and interest on this Note are payable in immediately
available funds in such coin or currency of the United States of America as at
the time of payment is legal tender for payment of public and private debts at
the office or agency of the Corporation designated as provided in the Indenture;
provided, however, that interest may be paid, at the option of the Corporation,
by check mailed to the person entitled thereto at his address last appearing on
the registry books of the Corporation relating to the Notes. Notwithstanding the
preceding sentence, payments of principal of and interest payable on the
Maturity Date will be made by wire transfer of immediately available funds to a
designated account maintained in the United States upon (i) receipt of written
notice by the Issuing and Paying Agent from the holder hereof not less than one
Business Day prior to the due date of such principal and (ii) presentation of
this Note to the Issuing and Paying Agent at [The Bank of New York, as Issuing
and Paying Agent, 101 Barclay Street, New York, New York 10286] (the "Corporate
Trust Office").
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof, which shall have the same effect as though fully
set forth at this place.
Unless the Certificate of Authentication hereon has been executed by
the Trustee or an Authenticating Agent on behalf of the Trustee by manual
signature, this Note shall not be entitled
3
<PAGE>
to any benefit under such Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Corporation has caused this Instrument to be
duly executed, by manual or facsimile signature, under its corporate seal or a
facsimile thereof.
NATIONSBANK CORPORATION
By:________________________________
[SEAL] [Title: ]
ATTEST:
___________________________
_________ Secretary
4
<PAGE>
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:
as Authenticating Agent]
By:___________________________
Authorized Signatory
5
<PAGE>
[Reverse of Note]
NATIONSBANK CORPORATION
MEDIUM-TERM SUBORDINATED NOTE,
SERIES ___
(Floating Rate)
This Medium-Term Note is one of a duly authorized series of Securities
of the Corporation unlimited in aggregate principal amount (herein called the
"Notes") issued and to be issued under an Indenture dated as of January 1, 1995
(herein called the "Indenture"), between the Corporation and The Bank of New
York, as Trustee (herein called the "Trustee," which term includes any successor
trustee under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights
thereunder of the Corporation, the Trustee and the holders of the Notes, and the
terms upon which the Notes are, and are to be, authenticated and delivered. This
Note is also one of the Notes designated as the Corporation's Subordinated
Medium-Term Notes, Series ___, limited in aggregate principal amount to
[$____________]. The Notes may bear different dates, mature at different times,
bear interest at different rates and vary in such other ways as are provided in
the Indenture.
THE INDEBTEDNESS OF THE CORPORATION EVIDENCED BY THE NOTES, INCLUDING
THE PRINCIPAL THEREOF AND INTEREST THEREON, IS, TO THE EXTENT AND IN THE MANNER
SET FORTH IN THE INDENTURE, SUBORDINATE AND JUNIOR IN RIGHT OF PAYMENT TO ITS
OBLIGATIONS TO HOLDERS OF SENIOR INDEBTEDNESS, AS DEFINED IN THE INDENTURE, AND
EACH HOLDER OF THE NOTES, BY THE ACCEPTANCE HEREOF, AGREES TO AND SHALL BE BOUND
BY SUCH PROVISIONS OF THE INDENTURE.
This Note is not subject to any sinking fund.
This Note may be subject to repayment at the option of the holder only
if Optional Repayment Date(s) are indicated on the face hereof. IF NO OPTIONAL
REPAYMENT DATES ARE SET FORTH ON THE FACE HEREOF, THIS NOTE MAY NOT BE SO REPAID
AT THE OPTION OF THE HOLDER HEREOF PRIOR TO THE STATED MATURITY DATE. On any
Optional Repayment Date, this Note shall be repayable in whole or in part in
increments of $1,000 at the option of the holder hereof at a repayment price
equal to 100% of the principal amount to be repaid, together with interest
thereon payable to the date of repayment. For this Note to be repaid in whole or
in part at the option of the holder hereof, this Note must be received, with the
form below entitled "Option to Elect Repayment" duly completed, by the Issuing
and Paying Agent at the Corporate Trust Office, or such other address of which
the Corporation shall from time to time notify the holders of the Notes, not
more than 60 nor less than 30 days prior to an Optional Repayment Date. Exercise
of such repayment option by the holder hereof shall be irrevocable.
6
<PAGE>
This Note may be redeemed at the option of the Corporation on any date
on and after the Initial Redemption Date, if any, specified on the face hereof
(the "Redemption Date"). IF NO INITIAL REDEMPTION DATE IS SET FORTH ON THE FACE
HEREOF, THIS NOTE MAY NOT BE REDEEMED AT THE OPTION OF THE CORPORATION PRIOR TO
THE STATED MATURITY DATE. On and after the Initial Redemption Date, if any, this
Note may be redeemed at any time in whole or from time to time in part in
increments of $1,000 at the option of the Corporation at the applicable
Redemption Price (as defined below) together with interest thereon payable to
the Redemption Date, on notice given not more than 60 nor less than 30 days
prior to the Redemption Date. In the event of redemption of this Note in part
only, a new Note for the unredeemed portion hereof shall be issued in the name
of the Holder hereof upon the surrender hereof.
If this Note is redeemable at the option of the Corporation, the
"Redemption Price" shall initially be the Initial Redemption Percentage,
specified on the face hereof, of the principal amount of this Note to be
redeemed and shall decline at each anniversary of the Initial Redemption Date by
the Annual Redemption Percentage Reduction, if any, specified on the face
hereof, of the principal amount to be redeemed until the Redemption Price is
100% of such principal amount.
Accrued interest hereon shall be calculated by multiplying the face
amount hereof by an accrued interest factor. Such accrued interest factor shall
be computed by adding the interest factor calculated for each day from and
including Original Issue Date, or from but excluding the last date to which
interest has been paid, as the case may be, to and including the date for which
accrued interest is being calculated. The interest factor (expressed as a
decimal) for each such day shall be computed by dividing the interest rate in
effect on such day by 360 or, in the case of Notes having the Treasury Rate or
the CMT Rate as their Base Rate, by the actual number of days in the year.
The Base Rate (as defined herein) with respect to this Note may be (i)
the CD Rate, (ii) the Commercial Paper Rate, (iii) LIBOR, (iv) the Federal Funds
Rate, (v) the Prime Rate, (vi) the Treasury Rate, (vii) the CMT Rate, (viii) the
Eleventh District Cost of Funds Rate or (ix) such other rate as will be
described on the face hereof and a rider to this Note.
Except as described below, this Note will bear interest at the rate
determined by reference to the appropriate interest rate basis (the "Base Rate")
and Index Maturity shown on the face hereof (i) plus or minus the Spread, if
any, or (ii) multiplied by the Spread Multiplier, if any, specified on the face
hereof. The interest rate in effect on each day shall be (a) if such day is an
Interest Reset Date, the interest rate determined as of the Interest
Determination Date (as defined below) pertaining to such Interest Reset Date or
(b) if such day is not an Interest Reset
7
<PAGE>
Date, the interest rate determined as of the Interest Determination Date
pertaining to the next preceding Interest Reset Date, provided that (i) the
interest rate in effect from the Original Issue Date to the first Interest Reset
Date shall be the Initial Interest Rate specified on the face hereof, and (ii)
the interest rate in effect for the ten calendar days immediately prior to the
Maturity Date shall be the rate in effect on the tenth calendar day preceding
such Maturity Date. If any Interest Reset Date would otherwise be a day that is
not a Business Day, such Interest Reset Date shall be postponed to the next day
that is a Business Day, except that if the Base Rate specified on the face
hereof is LIBOR, if such next Business Day is in the next succeeding calendar
month, such Interest Reset Date shall be the immediately preceding Business Day.
The term "Final Interest Payment Period" means the period from the final
Interest Reset Date to the Maturity Date.
The Interest Determination Date with respect to any Note that has as
its Base Rate the CD Rate, the Commercial Paper Rate, the Federal Funds rate,
the Prime Rate or the CMT Rate will be the second Business Day preceding the
Interest Reset Date. The Interest Determination Date with respect to LIBOR shall
be the second London Banking Day (as defined below) preceding the Interest Reset
Date. The Interest Determination Date with respect to the Eleventh District Cost
of Funds Rate will be the last Business Day of the month immediately preceding
such Interest Reset Date in which the Federal Home Loan Bank of San Francisco
(the "FHLB") publishes such Index (as defined below); and the Interest
Determination Date with respect to the Treasury Rate shall be the day of the
week in which the Interest Reset Date falls on which Treasury bills of the Index
Maturity specified on the face hereof normally would be auctioned; provided,
however, that if as a result of a legal holiday an auction is held on the Friday
of the week preceding the Interest Reset Date, the related Interest
Determination Date shall be such preceding Friday; and provided, further, that
if an auction shall fall on any Interest Reset Date then the Interest Reset Date
shall instead be the first Business Day following such auction.
The "Calculation Date" pertaining to any Interest Determination Date
shall be the earlier of (i) the tenth calendar day after such Interest
Determination Date or, if such day is not a Business Day, the next succeeding
Business Day, or (ii) the Business Day next preceding the applicable Interest
Payment Date or Maturity Date, as the case may be.
All percentages resulting from any calculation on the Notes will be
rounded, if necessary, to the nearest one hundred-thousandth of a percentage
point, with five one-millionths of a percentage point rounded upward, and all
dollar amounts used in or resulting from such calculation on the Notes will be
rounded to the nearest cent (with one-half cent being rounded upward).
8
<PAGE>
Determination of CD Rate. CD Rate means, with respect to an Interest
Determination Date (a "CD Rate Interest Determination Date"), the rate on such
CD Rate Interest Determination Date for negotiable certificates of deposit
having the Index Maturity specified on the face hereof, as such rate is
published by the Board of Governors of the Federal Reserve System (the "Federal
Reserve Board") in "Statistical Release H.15(519), Selected Interest Rates," or
any successor publication of the Federal Reserve Board ("H.15(519)"), under the
heading "CDs (Secondary Market)," or, if not so published by 3:00 P.M., New York
City time, on the Calculation Date pertaining to such CD Rate Interest
Determination Date, the CD Rate will be the rate on such CD Rate Interest
Determination Date for negotiable certificates of deposit of the Index Maturity
specified on the face hereof, as published by the Federal Reserve Bank of New
York in its daily statistical release "Composite 3:30 P.M. Quotations for U.S.
Government Securities" ("Composite Quotations") under the heading "Certificates
of Deposit." If such rate is not published in either H.15(519) or the Composite
Quotations by 3:00 P.M., New York City time, on such Calculation Date, then the
CD Rate on such CD Rate Interest Determination Date will be calculated by the
Calculation Agent and will be the arithmetic mean of the secondary market
offered rates as of 10:00 A.M., New York City time, on such CD Rate Interest
Determination Date, of three leading nonbank dealers in negotiable U.S. dollar
certificates of deposit in The City of New York selected by the Calculation
Agent for negotiable certificates of deposit of major United States money center
banks with a remaining maturity closest to the Index Maturity specified on the
face hereof in denominations of $5,000,000; provided, however, that if the
dealers selected as aforesaid by the Calculation Agent are not quoting as set
forth above, the CD Rate for such CD Rate Interest Determination Date will be
the CD Rate in effect on such CD Rate Interest Determination Date.
Determination of Commercial Paper Rate. The Commercial Paper Rate
means, with respect to an Interest Determination Date (a "Commercial Paper Rate
Interest Determination Date"), the Money Market Yield (as defined below) of the
rate on such date for commercial paper having the Index Maturity specified on
the face hereof as published in H.15(519) under the heading "Commercial Paper."
In the event such rate is not published by 3:00 P.M., New York City time, on the
Calculation Date pertaining to such Commercial Paper Rate Interest Determination
Date, the Commercial Paper Rate shall be the Money Market Yield on such
Commercial Paper Rate Interest Determination Date of the rate for commercial
paper having the Index Maturity specified on the face hereof as published in
Composite Quotations under the heading "Commercial Paper." If such rate is not
published in either H.15(519) or Composite Quotations by 3:00 P.M., New York
City time, on such Calculation Date, the Commercial Paper Rate for that
Commercial Paper Rate Interest Determination Date shall be calculated by the
Calculation Agent and shall be the Money Market
9
<PAGE>
Yield of the arithmetic mean of the offered rates as of 11:00 A.M., New York
City time, on such Commercial Paper Rate Interest Determination Date of three
leading dealers of commercial paper in The City of New York selected by the
Calculation Agent for commercial paper of the Index Maturity specified on the
face hereof placed for an industrial issuer whose bond rating is "AA", or the
equivalent, by a nationally recognized securities rating agency; provided,
however, that if the dealers selected as aforesaid by the Calculation Agent are
not quoting as set forth above, the Commercial Paper Rate with respect to such
Commercial Paper Rate Interest Determination Date will be the Commercial Paper
Rate then in effect on such Commercial Paper Rate Interest Determination Date.
"Money Market Yield" shall be the yield (expressed as a percentage
rounded to the nearest one ten-thousandth of a percent, with five one
hundred-thousandths of a percent rounded upward) calculated in accordance with
the following formula:
D x 360
Money Market Yield =
360 - (D x M) x 100
where "D" refers to the per annum rate for commercial paper quoted on a bank
discount basis and expressed as a decimal, and "M" refers to the actual number
of days in the interest period for which interest is being calculated.
Determination of LIBOR. LIBOR means the rate determined by the
Calculation Agent in accordance with the following provisions:
(i) With respect to an Interest Determination Date (a "LIBOR
Interest Determination Date"), LIBOR will be "LIBOR Telerate" unless
"LIBOR Reuters" is specified on the face of this Note. "LIBOR Telerate"
is the rate for deposits in the LIBOR Currency (as defined below)
having the Index Maturity specified on the face hereof that appears on
the Designated LIBOR Page (as defined below) specified on the face
hereof as of 11:00 A.M. London time, on that LIBOR Interest
Determination Date. "LIBOR Reuters" is that rate which is the
arithmetic mean of the offered rates (unless the specified Designated
LIBOR Page by its terms provides only for a single rate, in which case
such single rate shall be used) for deposits in the LIBOR Currency
having the Index Maturity specified on the face hereof that appear on
the Designated LIBOR Page specified on the face hereof as of 11:00 A.M.
London time, on that LIBOR Interest Determination Date, if at least two
such offered rates appear (unless, as aforesaid, only a single rate is
required) on such Designated LIBOR Page. If LIBOR cannot be determined
under this clause (i), LIBOR in respect of the related LIBOR Interest
Determination Date will be determined as if the
10
<PAGE>
parties had specified the rate described in clause (ii)
below.
(ii) With respect to a LIBOR Interest Determination Date on which
the applicable LIBOR rate cannot be determined under clause (i) above,
the Calculation Agent will request the principal London offices of each
of four major reference banks in the London interbank market, as
selected by the Calculation Agent to provide the Calculation Agent with
its offered quotation for deposits in the LIBOR Currency for the period
of the Index Maturity specified on the face hereof to prime banks in
the London interbank market commencing on the applicable Interest Reset
Date at approximately 11:00 A.M., London time, on such LIBOR Interest
Determination Date and in a principal amount that is representative for
a single transaction in such LIBOR Currency in such market at such
time. If at least two such quotations are provided, LIBOR determined on
such LIBOR Interest Determination Date will be the arithmetic mean of
such quotations. If fewer than two such quotations are provided, LIBOR
for such LIBOR Interest Determination Date will be the arithmetic mean
of the rates quoted at approximately 11:00 A.M. in the applicable
Principal Financial Center (as defined below), on such LIBOR Interest
Determination Date by three major banks in such Principal Financial
Center selected by the Calculation Agent for loans in the LIBOR
Currency to leading European banks, having the Index Maturity specified
on the face hereof commencing on the applicable Interest Reset Date and
in a principal amount that is representative for a single transaction
in such LIBOR Currency in such market at such time; provided, however,
that if the banks so selected by the Calculation Agent are not quoting
as mentioned in this sentence, LIBOR determined on such LIBOR Interest
determination Date will be LIBOR then in effect on such LIBOR Interest
Determination Date.
"LIBOR Currency" means the currency (including composite currencies)
specified on the face hereof for which LIBOR shall be calculated. If no such
currency is specified on the face hereof, the LIBOR Currency shall be U.S.
dollars.
"Designated LIBOR Page" means either (a) if "LIBOR Telerate" is
specified on the face hereof, the display on the Dow Jones Telerate Service for
the purpose of displaying the London interbank offered rates of major banks for
the applicable LIBOR Currency or (b) if "LIBOR Reuters" is specified on the face
hereof, the display on the Reuters Monitor Money Rates Service for the purpose
of displaying the London interbank offered rates of major banks for the
applicable LIBOR Currency. If neither LIBOR Telerate nor LIBOR Reuters is
specified on the face hereof, LIBOR for the applicable LIBOR Currency will be
determined as if LIBOR Telerate (and, if the U.S. dollar is the LIBOR Currency,
Page 3750) had been specified.
11
<PAGE>
"Principal Financial Center" shall generally be the capital city of the
country of the specified LIBOR Currency, except that with respect to U.S.
dollars, Deutsche Marks and ECUs, the Principal Financial Center shall be The
City of New York, Frankfurt and Luxembourg, respectively.
Determination of Federal Funds Rate. The Federal Funds Rate means, with
respect to an Interest Determination Date (a "Federal Funds Rate Interest
Determination Date"), the rate on that date for Federal Funds as published in
H.15(519) under the heading "Federal Funds (Effective)." If H.15(519) is not so
published by 3:00 P.M., New York City time, on the Calculation Date pertaining
to such Federal Funds Rate Interest Determination Date, the Federal Funds Rate
will be the rate on such Federal Funds Rate Interest Determination Date as
published in Composite Quotations under the heading "Federal Funds/Effective
Rate." If such rate is not yet published in either H.15(519) or Composite
Quotations by 3:00 P.M., New York City time, on the Calculation Date pertaining
to such Federal Funds Rate Interest Determination Date, the Federal Funds Rate
for such Federal Funds Rate Interest Determination Date will be calculated by
the Calculation Agent and will be the arithmetic mean of the rates for the last
transaction in overnight Federal Funds as of 9:00 A.M., New York City time, on
such Federal Funds Rate Interest Determination Date quoted by each of three
leading brokers of Federal Funds transactions in The City of New York selected
by the Calculation Agent; provided, however, that if fewer than three such
brokers are so quoting such rates, the Federal Funds Rate with respect to such
Federal Funds Rate Interest Determination Date will be the Federal Funds Rate
then in effect on such Federal Funds Rate Interest Determination Date.
Determination of Prime Rate. Prime Rate means, with respect to an
Interest Determination Date (a "Prime Rate Interest Determination Date"), the
rate set forth on such date in H.15(519) under the heading "Bank Prime Loan," or
if not so published prior to 9:00 A.M. New York City time, on the Calculation
Date pertaining to such Prime Rate Interest Determination Date, then the Prime
Rate will be determined by the Calculation Agent and will be the arithmetic mean
of the rates of interest publicly announced by each bank that appears on the
Reuters Screen U.S. Prime 1 (as defined below) as such bank's prime rate or base
lending rates as in effect for that Prime Rate Interest Determination Date. If
fewer than four such rates but more than one such rate appear on the Reuters
Screen U.S. Prime 1 for the Prime Rate Interest Determination Date, the Prime
Rate will be determined by the Calculation Agent and will be the arithmetic mean
of the prime rates, quoted on the basis of the actual number of days in the year
divided by a 360-day year, as of the close of business on such Prime Rate
Interest Determination Date by four major money center banks in The City of New
York as selected by the Calculation Agent. If fewer than two such rates appear
on the Reuters Screen U.S. Prime 1, the
12
<PAGE>
Prime Rate shall be determined by the Calculation Agent as of the close of
business on the Prime Rate Interest Determination Date, on the basis of the
prime rates, as of the close of business on the Prime Rate Interest
Determination Date, furnished in The City of New York by the appropriate number
of substitute banks or trust companies organized and doing business under the
laws of the United States, or any State thereof, having total equity capital of
at least $500 million and being subject to supervision or examination by Federal
or State authority, selected by the Calculation Agent to provide such rate or
rates; provided, however, that if the banks selected as aforesaid are not
quoting as mentioned in this sentence, the Prime Rate for such Prime Rate
Interest Determination Date will be the Prime Rate then in effect on such Prime
Rate Interest Determination Date.
"Reuters Screen U.S. Prime 1" means the display designated as page
"U.S. Prime 1" on the Reuters Monitor Money Rates Service (or such other page as
may replace the U.S. Prime 1 page on that service for the purpose of displaying
prime rates or base lending rates of major United States banks).
Determination of Treasury Rate. Treasury Rate means, with respect to an
Interest Determination Date (a "Treasury Rate Interest Determination Date"), the
rate for the auction held on such Treasury Rate Interest Determination Date of
direct obligations of the United States ("Treasury Bills") having the Index
Maturity specified on the face hereof, as published in H.15(519) under the
heading "U.S. Government Securities -- Treasury Bills -- auction average
(investment)." If such rate is not published by 3:00 P.M., New York City time,
on the Calculation Date pertaining to such Treasury Rate Interest Determination
Date, the Treasury Rate will be the auction average rate (expressed as a bond
equivalent on the basis of a year of 365 or 366 days, as applicable, and applied
on a daily basis) on such Treasury Rate Interest Determination Date as otherwise
announced by the United States Department of the Treasury. In the event that the
results of the auction of Treasury bills having the Index Maturity specified on
the face hereof are not reported as provided by 3:00 P.M., New York City time,
on such Calculation Date, or if no such auction is held on such Treasury Rate
Interest Determination Date, then the Treasury Rate for such Treasury Rate
Interest Determination Date shall be a yield to maturity (expressed as a bond
equivalent, on the basis of a year of 365 or 366 days, as applicable, and
applied on a daily basis) of the arithmetic mean of the secondary market bid
rates, as of approximately 3:30 P.M., New York City time, on such Treasury Rate
Interest Determination Date, of three leading primary United States government
securities dealers selected by the Calculation Agent, for the issue of Treasury
bills with a remaining maturity closest to the Index Maturity specified on the
face hereof; provided, however, that if the dealers selected as aforesaid by the
Calculation Agent are not quoting as mentioned in this sentence, the Treasury
Rate with respect to such Treasury Rate
13
<PAGE>
Interest Determination Date will be the Treasury Rate then in effect on such
Treasury Rate Interest Determination Date.
Determination of CMT Rate. CMT Rate means with respect to an Interest
Determination Date relating to a CMT Rate Note or any Floating Rate Note for
which the interest rate is determined by reference to the CMT Rate (a "CMT Rate
Interest Determination Date"), the rate displayed on the designated CMT Telerate
Page under the caption "Treasury Constant Maturities . . . Federal Reserve Board
Release H.15 . . . Mondays approximately 3:45 p.m.," under the column for the
Designated CMT Maturity Index for (i) if the Designated CMT Telerate Page is
7055, the rate on such CMT Rate Interest Determination Date and (ii) if the
Designated CMT Telerate Page is 7052, the week, or the month, as applicable,
ended immediately preceding the week in which the Related CMT Rate Interest
Determination Date occurs. If such rate is no longer displayed on the relevant
page, or if not displayed by 3:00 p.m., New York City time, on the related
Calculation Date, then the CMT Rate for such CMT Rate Interest Determination
Date will be such Treasury Constant Maturity Rate for the Designated CMT
Maturity Index as published in the relevant H.15(519). If such rate is no longer
published, or if not published by 3:00 p.m. New York City time, on the related
Calculation Date, then the CMT Rate for such CMT Rate Interest Determination
Date will be such Treasury Constant Maturity Rate for the Designated CMT
Maturity Index (or other United States Treasury rate for the Designated CMT
Maturity Index) for the CMT Rate Interest Determination Date with respect to
such Interest Reset Date as may then be published by either the Board of
Governors of the Federal Reserve System or the United States Department of the
Treasury that the Calculation Agent determines to be comparable to the rate
formerly displayed on the Designated CMT Telerate Page and published in the
relevant H.15(519). If such information is not provided by 3:00 p.m., New York
City time, on the related Calculation Date, then the CMT Rate for the CMT Rate
Interest Determination Date will be calculated by the Calculation Agent and will
be a yield to maturity, based on the arithmetic mean of the secondary market
closing offer side prices as of approximately 3:30 p.m., New York City time, on
the CMT Interest Determination Date reported, according to their written
records, by three leading primary United States government securities dealers
(each a "Referenced Dealer") in The City of New York selected by the Calculation
Agent (from five such Referenced Dealers selected by the Calculation Agent and
eliminating the highest quotation (or, in the event of equality, one of the
highest) and the lowest quotation (or, in the event of equality, one of the
lowest)), for the most recently issued direct, non-callable fixed rate
obligations of the United States ("Treasury Note") with an original maturity of
approximately the Designated CMT Maturity Index and a remaining term to maturity
of not less than such Designated CMT Maturity Index minus one year. If the
Calculation Agent cannot obtain three such Treasury Note quotations, the CMT
Rate for such CMT Rate Interest Determination
14
<PAGE>
Date will be calculated by the Calculation Agent and will be a yield to maturity
based on the arithmetic mean of the secondary market side offer prices as of
approximately 3:30 p.m. New York City time on the CMT Rate Interest
Determination Date of three Referenced Dealers in The City of New York (from
five such Referenced Dealers selected by the Calculation Agent and eliminating
the highest quotation (or, in the even of equality, one of the highest) and
lowest quotation (or, in the event of equality, one of the lowest)), for
Treasury Notes with original maturity of the number of years that is the next
highest to the Designated CMT Maturity Index and a remaining term to maturity
closest to the Designated CMT Maturity Index and in an amount of at least
$100,000,000. If three or four (and not five) of such Referenced Dealers are
quoting as described above, then the CMT Rate will be based on the arithmetic
mean of the offer prices obtained and neither the highest nor lowest of such
quotes will be eliminated; provided however, that if fewer than three Referenced
Dealers selected by the Calculation Agent are quoting as described herein, the
CMT Rate will be the CMT Rate in effect on such CMT Rate Interest Determination
Date. If two Treasury Notes with an original maturity as described in the third
preceding sentence have remaining terms to maturity equally close to the
Designated CMT Maturity Index, the quotes for the Treasury Rate Note with the
shorter remaining term to maturity will be used.
"Designated CMT Telerate Page" means the display on the Dow Jones
Telerate Service on the page designated on the face of this Note (or any other
page as may replace such page on that service for the purpose of displaying
Treasury Constant Maturities as reported in H.15(519)), or the purpose of
displaying Treasury Constant Maturity as reported in H.15(519). If no such page
is specified, the Designated CMT Telerate Page shall be 7052, for the most
recent week.
"Designated CMT Maturity Index" means the original period to maturity
of the U.S. Treasury Securities (either 1, 2, 3, 5, 7, 10, 20 or 30 years)
specified on the fact of this Note with respect to which the CMT Rate will be
calculated. If no such maturity is specified on the face of this Note, the
Designated CMT Maturity Index shall be two years.
Determination of Eleventh District Cost of Funds Rate. Eleventh
District Cost of Funds Rate means, with respect to an Interest Determination
Date relating to an Eleventh District Cost of Funds Rate (an "Eleventh District
Cost of Funds Rate Interest Determination Date"), the rate equal to the monthly
weighted average cost of funds for the calendar month preceding such Eleventh
District Cost of Funds Rate Interest Determination Date as set forth under the
caption "Eleventh District" on Telerate page 7058 as of 11:00 a.m., San
Francisco time, on such Eleventh District Cost of Funds Rate Interest
Determination Date. If such rate does not appear on the Telerate page 7058 on
any related
15
<PAGE>
Eleventh District Cost of Funds Rate Interest Determination Date, the Eleventh
District Cost of Funds Rate for such Eleventh District Cost of Funds Rate
Interest Determination Date shall be the monthly weighted average cost of funds
paid by member institutions of the Eleventh Federal Home Loan Bank District that
was most recently announced (the "Index") by the FHLB of San Francisco as such
cost of funds for the calendar month preceding the date of such announcement. If
the FHLB of San Francisco fails to announce such rate for the calendar month
next preceding such Eleventh District Cost of Funds Rate Interest Determination
Date, then the Eleventh District Cost of Funds Rate for such Eleventh District
Cost of Funds Rate Interest Determination Date will be the Eleventh District
Cost of Funds Rate in effect on such Eleventh District Cost of Funds Rate
Interest Determination Date. "Telerate Page 7058" means the display on the Dow
Jones Telerate Service on such page (or such other page as may replace such page
on the service for the purpose of displaying the Eleventh District Cost of Funds
Rate) for the purpose of displaying the monthly average cost of the funds paid
by member institutions of the Eleventh Federal Home Loan Bank District.
Notwithstanding the foregoing, the interest rate hereon shall not be
greater than the Maximum Interest Rate, if any, or less than the Minimum
Interest Rate, if any, specified on the face hereof. The Calculation Agent shall
calculate the interest rate hereon in accordance with the foregoing on or before
each Calculation Date. The interest rate on this Note will in no event be higher
than the maximum rate permitted by New York law, as the same may be modified by
United States law of general application.
At the request of the holder hereof, the Calculation Agent will provide
to the holder hereof the interest rate hereon then in effect and, if determined,
the interest rate which will become effective as of the next Interest Reset
Date.
[The provisions of Article Fourteen of the Indenture do not
apply to the Notes.]
If an Event of Default (defined in the Indenture as certain events
involving the bankruptcy of the Corporation) shall occur with respect to the
Notes, the principal of all the Notes may be declared due and payable in the
manner and with the effect provided in the Indenture. THERE IS NO RIGHT OF
ACCELERATION PROVIDED IN THE INDENTURE IN CASE OF A DEFAULT IN THE PAYMENT OF
INTEREST OR THE PERFORMANCE OF ANY OTHER COVENANT BY THE CORPORATION.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Corporation and the rights of the holders of the Notes under the Indenture at
any time by the Corporation with the consent of the holders of not less than 66
16
<PAGE>
2/3% in aggregate principal amount of the Notes then outstanding and all other
Securities then outstanding under the Indenture and affected by such amendment
and modification. The Indenture also contains provisions permitting the holders
of a majority in aggregate principal amount of the Notes then outstanding and
all other Securities then outstanding under the Indenture and affected thereby,
on behalf of the holders of all such Securities, to waive compliance by the
Corporation with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
holder of this Note shall be conclusive and binding upon such holder and upon
all future holders of this Note and of any Note issued upon the registration of
transfer hereof or in exchange herefor or in lieu hereof whether or not notation
of such consent or waiver is made upon this 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 Corporation, which
is absolute and unconditional, to pay the principal of and interest on this Note
at the times, place and rate, and in the coin or currency, herein prescribed.
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 or any indenture supplemental
thereto, against any incorporator, stockholder, officer or director, as such,
past, present or future, of the Corporation or 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 issue
hereof, expressly waived and released.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Note may be registered on the registry books of
the Corporation relating to the Notes, upon surrender of this Note for
registration of transfer at the office or agency of the Corporation designated
by it pursuant to the Indenture, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Corporation and the Trustee
or the Security Registrar duly executed by, the 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, will be issued to the
designated transferee or transferees.
The Notes are issuable only as registered Notes without coupons in
denominations of $1,000 and any integral multiple thereof. As provided in the
Indenture, and subject to certain limitations therein set forth, Notes are
exchangeable for a like
17
<PAGE>
aggregate principal amount of Notes of different authorized denominations, as
requested by the holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange, but the Corporation may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment for registration of transfer of this Note, the
Corporation, the Trustee, the Issuing and Paying Agent and any agent of the
Corporation, the Trustee or the Issuing and Paying Agent may treat the entity in
whose name this Note is registered as the absolute owner hereof for the purpose
of receiving payment as herein provided and for all other purposes, whether or
not this Note be overdue, and neither the Corporation, the Trustee, the Issuing
and Paying Agent nor any such agent shall be affected by notice to the contrary.
All terms used in this Note which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
If the Notes are to be issued and outstanding pursuant to a book-entry
system, the following paragraph is applicable: Notes are being issued by means
of a book-entry system with no physical distribution of certificates to be made
except as provided in the Indenture. The book-entry system maintained by The
Depository Trust Company ("DTC") will evidence ownership of the Notes, with
transfers of ownership effected on the records of DTC and its participants
pursuant to rules and procedures established by DTC and its participants. The
Corporation will recognize Cede & Co., as nominee of DTC, while the registered
owner of the Notes, as the owner of the Notes for all purposes, including
payment of principal and interest, notices and voting. Transfer of principal and
interest to participants of DTC will be the responsibility of DTC, and transfer
of principal and interest to beneficial owners of the Notes by participants of
DTC will be the responsibility of such participants and other nominees of such
beneficial owners. [So long as the book-entry system is in effect, the selection
of any Notes to be redeemed will be determined by DTC pursuant to rules and
procedures established by DTC and its participants.] The Corporation will not be
responsible or liable for such transfers or payments or for maintaining,
supervising or reviewing the records maintained by DTC, its participants or
persons acting through such participants.
If the Notes may be settled through depositories located in Europe, the
following paragraph is applicable: Transfers of Notes in Europe may be effected
through the facilities of Cedel Bank, societe anonyme, and Morgan Guaranty Trust
Company of New York, Brussels office, as operator of the Euroclear system, in
accordance with the rules and procedures established by such depositories.
18
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of the within Note, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM--as tenants in common
TEN ENT--as tenants by the entireties
JT TEN-- as joint tenants with right of survivorship
and not as tenants in common
UNIF GIFT MIN ACT--.............Custodian..........
(Cust) (Minor)
Under Uniform Gifts to Minors Act
.................................
(State)
Additional abbreviations may also be used though not in the above list.
-----------------------------
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s),
assign(s) and transfer(s) unto
[PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS
INCLUDING ZIP CODE OF ASSIGNEE]
________________________________________________________________
________________________________________________________________
________________________________________________________________
Please Insert Social Security or Other
Identifying Number of Assignee: ____________________________
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing __________________________________ Attorney to transfer said Note on
the books of the Corporation, with full power of substitution in the premises.
Dated:_________________________ _________________________
NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Note in every particular, without alteration
or enlargement or any change whatever and must be guaranteed.
19
<PAGE>
[OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably request(s) and instruct(s) the
Corporation to repay this Note (or portion hereof specified below) pursuant to
its terms at a price equal to the principal amount hereof together with interest
to the repayment date, to the undersigned, at ________________________________
_____________________________________________________________
(Please print or typewrite name and address of the undersigned)
For this Note to be repaid, the Trustee (or the Paying Agent on behalf
of the Trustee) must receive at ______________, or at such other place or places
of which the Corporation shall from time to time notify the Holder of this Note,
not more than 60 nor less than 30 days prior to an Optional Repayment Date, if
any, shown on the face of this Note, this Note with this "Option to Elect
Repayment" form duly completed.
If less than the entire principal amount of this Note is to be repaid,
specify the portion hereof (which shall be in increments of $1,000) which the
Holder elects to have repaid and specify the denomination or denominations
(which shall be $__________ or an integral multiple Of $1,000 in excess of
$__________) of the Notes to be issued to the Holder for the portion of this
Note not being repaid (in the absence of any such specification, one such Note
will be issued for the portion not being repaid).
$__________________________ ___________________________________
NOTICE: The signature on this
Option to Elect Repayment must
Date:_______________ correspond with the name as written
upon the face of this Note in every
particular, without alteration or
enlargement or any change whatever.]
20
<PAGE>
RENEWABLE NOTE RIDER
The Corporation and the purchaser of this Note have agreed that this
Note is a Renewable Note which initially matures on the Stated Maturity Date
shown on the face of this Note. At each Renewal Date, the maturity of this Note
will be automatically extended to the corresponding New Maturity Date unless the
holder of this Note delivers a completed Extension Termination Notice to the
Trustee or the Paying Agent on behalf of the Trustee not less than 15 nor more
than 30 days prior to the applicable Renewal Date. The Extension Termination
Notice may specify all or a portion of the outstanding principal amount of the
Note so long as the principal amount of the Note remaining outstanding after
repayment is an integral multiple of $1,000. Upon timely delivery of such
Extension Termination Notice, the term of the principal amount of this Note
subject to such notice will be deemed automatically to mature on the Stated
Maturity Date or the then applicable New Maturity Date, as the case may be. The
remaining principal balance of such Note, if any, will be deemed to
automatically be extended to the corresponding New Maturity Date but in no
circumstances may such maturity be extended beyond the Final Maturity Date.
Notwithstanding any such extension, the interest rate applicable to this Note
will continue to be calculated as set forth in this Note.
STATED MATURITY DATE:_________________________________
FINAL MATURITY DATE:__________________________________
Renewal Date (s) New Maturity Date(s)
21
<PAGE>
EXTENDIBLE NOTE RIDER
The Corporation and the purchaser of this Note have agreed that this
Note is an Extendible Note, whereby the Corporation has the option to extend the
maturity of this Note by delivery to the Trustee (or any duly authorized Paying
Agent) of an Extendible Option Notice under the terms of this Note as
supplemented by this Extendible Note Rider.
Stated Maturity Date:
Final Maturity Date:
Extension Notice Extended
Due Date Maturity Date
The Corporation may exercise its option with respect to an Extendible
Note by delivery to the Trustee (or any duly appointed Paying Agent) of an
Extendible Option Notice at least 45 but not more than 60 days prior to the
Stated Maturity Date originally in effect with respect to such Note or, if the
Stated Maturity Date of such Note has already been extended, the Extended
Maturity Date then in effect. After such receipt and not later than 40 days
prior to the Stated Maturity Date or an Extended Maturity Date, as the case may
be (each, a "Maturity Date"), the Trustee (or any duly appointed Paying Agent)
will mail first class mail, postage prepaid, to the holder of such Extendible
Note a notice (the "Extension Notice") relating to such extension period (the
"Extension Period") setting forth (i) the election of the Corporation to extend
the maturity of such Extendible Note, (ii) the new Extended Maturity Date, (iii)
in the case of a Fixed Rate Note, the interest rate applicable to the Extension
Period or, in the case of a Floating Rate Note, the Spread and/or Spread
Multiplier applicable to the Extension Period, and (iv) the provisions, if any,
for redemption during the Extension Period, including the date or dates on
which, the period or periods during which and the price or prices at which such
redemption may occur during the Extension Period. Upon the mailing by the
Trustee (or any duly appointed Paying Agent) of an Extension Notice to the
holder of an Extendible Note, the maturity of such Note shall be extended
automatically as set forth in the Extension Notice, and, except as modified by
the Extension Notice and as described in the next paragraph, such Extendible
Note will have the same terms as prior to the mailing of such Extension Notice.
22
<PAGE>
Notwithstanding the foregoing, not later than 20 days prior to the
Maturity Date for an Extendible Note (or, if such date is not a Business Day, on
the immediately succeeding Business Day), the Corporation may, at its option,
revoke the interest rate, in the case of a Fixed Rate Note, or the Spread and/or
Spread Multiplier, in the case of a Floating Rate Note, provided for in the
Extension Notice and establish a higher interest rate, in the case of a Fixed
Rate Note, or a higher Spread and/or Spread Multiplier, in the case of a
Floating Rate Note, for the Extension period by mailing or causing the Trustee
(or any duly appointed Paying Agent) to mail notice of such higher interest rate
or higher Spread and/or Spread Multiplier, as the case may be, first class mail,
postage prepaid, to the holder of such Note. Such notice shall be irrevocable.
All Extendible Notes with respect to which the Maturity Date is extended will
bear such higher interest rate, in the case of a Fixed Rate Note, or higher
Spread and/or Spread Multiplier, in the case of a Floating Rate Note, for the
Extension Period.
If the Corporation elects to extend the maturity of an Extendible Note,
the holder of such Note will have the option to elect repayment of such Note by
the Corporation on the Maturity Date then in effect at a price equal to the
principal amount thereof plus any accrued and unpaid interest to such date. In
order for an Extendible Note to be so repaid on the Maturity Date, the
Corporation must receive, at least 15 days but not more than 30 days prior to
the Maturity Date then in effect with respect to the Note, (i) the Note with the
form "Option to Elect Repayment" on the reverse of the Note duly completed or
(ii) a telegram, telex, facsimile transmission or a letter from a member of a
national securities exchange, or the National Association of Securities Dealers,
Inc. or a commercial bank or trust company in the United States setting forth
the name of the holder of the Note, the principal amount of the Note, the
principal amount of the Note to be repaid, the certificate number or a
description of the tenor and terms of the Note, a statement that the option to
elect repayment is being exercised thereby and a guarantee that the Note to be
repaid, together with the duly completed form entitled "Option to Elect
Repayment" attached to the Note, will be received by the Trustee (or any duly
appointed Paying Agent) not later than the fifth Business Day after the date of
such telegram, telex, facsimile transmission or letter, PROVIDED, HOWEVER, that
such telegram, telex, facsimile transmission or letter shall only be effective
if such Note and duly completed form are received by the Trustee (or any duly
appointed Paying Agent) by such fifth Business Day. Such option may be exercised
by the holder of an Extendible Note for less than the aggregate principal amount
of the Note then outstanding, provided that the principal amount of the Note
remaining outstanding after repayment is an integral multiple of $1,000.
23
<PAGE>
SMITH HELMS MULLISS & MOORE, L.L.P.
Attorneys at Law
214 North Church Street
Charlotte, North Carolina 28202
Telephone (704) 343-2098
October 9, 1996
NationsBank Corporation
NationsBank Corporate Center
Charlotte, North Carolina 28255
Re: Registration Statement on Form S-3 filed on October 9, 1996 with
respect to an Aggregate of $3,000,000,000 of Debt Securities, Preferred
Stock, Depositary Shares and Common Stock
Ladies and Gentlemen:
We have acted as counsel to NationsBank Corporation (the "Corporation")
in connection with the registration by the Corporation of (A) up to an aggregate
of $3,000,000,000 of its (i) unsecured debt securities (the "Debt Securities"),
which may be either senior or subordinated, (ii) shares of its preferred stock
(the "Preferred Stock"), which may be represented by depositary shares (the
"Depositary Shares"), and (iii) shares of its common stock (the "Common Stock"
and, together with the Debt Securities, Preferred Stock and Depositary Shares,
the "Securities") and (B) an indeterminate amount of Securities that may be
issued upon conversion of Debt Securities, Preferred Stock or Depositary Shares,
as set forth in the Registration Statement on Form S-3 (the "Registration
Statement") that is being filed on the date hereof with the Securities and
Exchange Commission by the Corporation pursuant to the Securities Act of 1933,
as amended. This opinion letter is Exhibit 5.1 to the Registration Statement.
The Securities are to be issued, separately or together, in one or more
series and are to be sold from time to time as set forth in the Registration
Statement, the Prospectuses contained therein (each, a "Prospectus") and any
amendments or supplements thereto.
We have relied upon an officer's certificate as to corporate action
heretofore taken with respect to the Securities.
Based on the foregoing, we are of the opinion that when (1) the
Registration Statement shall have been declared effective by order of the
Securities and Exchange Commission, (2) the terms of any class or series of such
Securities have been authorized by appropriate corporate action of the
Corporation and (3) such Securities have been issued and sold upon the terms and
conditions set forth in the Registration Statement, the applicable Prospectus
and the applicable supplement(s) to such Prospectus, then (a) the Debt
Securities will be validly authorized and
<PAGE>
NationsBank Corporation
October 9, 1996
Page 2
issued and binding obligations of the Corporation, and (b) the shares of the
Preferred Stock and Common Stock will be legally issued, fully paid and
non-assessable.
In rendering this opinion, we are not expressing an opinion as to the
laws of any jurisdiction other than the State of North Carolina and the United
States of America, and we assume no responsibility as to the applicability of
the laws of any other jurisdiction to the subject matter hereof or to the
effects of such laws thereon.
This opinion is rendered to you and for your benefit solely in
connection with the registration of the Securities. This opinion may not be
relied on by you for any other purpose and may not be relied upon by, nor may
copies thereof be provided to, any other person, firm, corporation or entity for
any purposes whatsoever without our prior written consent. We hereby consent to
be named in the Registration Statement and in each of the Prospectuses as
attorneys who passed upon the legality of the Securities and to the filing of a
copy of this opinion as Exhibit 5.1 to the Registration Statement. Unless the
prior written consent of our firm is obtained, this opinion is not to be quoted
or otherwise referred to in any written report, proxy statement or other
registration statement, nor is it to be filed with or furnished to any other
governmental agency or other person, except as otherwise required by law.
Very truly yours,
SMITH HELMS MULLISS & MOORE, L.L.P.
<PAGE>
EXHIBIT 23.2
CONSENT OF PRICE WATERHOUSE LLP
We hereby consent to the incorporation by reference in the Prospectuses
constituting part of this Registration Statement on Form S-3 of NationsBank
Corporation of our report dated January 12, 1996, which appears on page 46 of
the 1995 Annual Report to Shareholders of NationsBank Corporation, which is
incorporated by reference in NationsBank Corporation's Annual Report on Form
10-K for the year ended December 31, 1995. We also consent to the reference to
us under the heading "EXPERTS" in such Prospectuses.
PRICE WATERHOUSE LLP
Charlotte, North Carolina
October 9, 1996
<PAGE>
<PAGE>
Consent of Ernst & Young LLP
We consent to the incorporation by reference in the Registration Statement
(Form S-3) and related prospectus of NationsBank Corporation for the
registration of $3,000,000,000 of debt and equity securities of our report
dated January 18, 1996 (except for the pooling of interest with Fourth
Financial Corporation as of January 31, 1996, and Note 3, for which the
date is January 31, 1996) with respect to the supplemental consolidated
financial statements of Boatmen's Bancshares, Inc. for the three years ended
December 31, 1995 and 1994, and 1993 incorporated by reference in NationsBank
Corporation's Current Report on Form 8-K dated September 6, 1996, as filed
with the Securities and Exchange Commission.
(Signature of Ernst & Young LLP)
St. Louis, Missouri
October 8, 1996
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each of NationsBank Corporation, and
the several undersigned Officers and Directors thereof whose signatures appear
below, hereby makes, constitutes and appoints Paul J. Polking and Charles M.
Berger, and each of them acting individually, its, his and her true and lawful
attorneys, with power to act without any other and with full power of
substitution, to execute, deliver and file in its, his and her name and on its,
his and her behalf, and in each of the undersigned Officer's and Director's
capacity or capacities as shown below, (a) a Registration Statement on Form S-3
(or other appropriate form) with respect to the registration under the
Securities Act of 1933, as amended (the "Securities Act"), of up to
$3,000,000,000 in aggregate initial offering price of (i) NationsBank
Corporation's unsecured debt securities, which may be either senior or
subordinated and which may include medium-term notes and debt denominated in
foreign currencies, (ii) shares of NationsBank Corporation preferred stock,
which may be represented by depositary shares, and (iii) shares of NationsBank
Corporation common stock (the debt securities, preferred stock and common stock
hereinafter collectively referred to as the "Securities"), which Securities may
be offered separately or together, in separate series and in amounts, at prices
and on terms to be determined at the time of sale, all as authorized by the
Board of Directors of NationsBank Corporation as of September 25, 1996, and all
documents in support thereof or supplemental thereto and any and all amendments,
including any and all pre-effective and post-effective amendments, to the
foregoing (hereinafter collectively called the "Registration Statement"); and
(b) such registration statements, petitions, applications, consents to service
of process or other instruments, any and all documents in support thereof or
supplemental thereto, and any and all amendments or supplements to the
foregoing, as may be necessary or advisable to qualify or register the
securities covered by said Registration Statement under such securities laws,
regulations and requirements as may be applicable; and each of NationsBank
Corporation and said Officers and Directors hereby grants to said attorneys, and
to each of them, full power and authority to do and perform each and every act
and thing whatsoever as said attorneys or attorney may deem necessary or
advisable to carry out fully the intent of this power of attorney to the same
extent and with the same effect as NationsBank Corporation might or could do,
and as each of said Officers and Directors might or could do personally in his
or her capacity or capacities as aforesaid, and each of NationsBank Corporation
and said Officers and Directors hereby ratifies and confirms all acts and things
which said attorneys or attorney might do or cause to be done by virtue of this
power of attorney and its, his or her signature as the same may be signed by
said attorneys or attorney, or any of them, to any or all of the following
(and/or any and all amendments and supplements to any or all thereof): such
Registration Statement under the Securities Act of 1933, as amended, and all
such registration statements, petitions, applications, consents to service of
process and other instruments, and any and all documents in support thereof or
supplemental thereto, under such securities laws, regulations and requirements
as may be applicable.
IN WITNESS WHEREOF, NationsBank Corporation has caused this power of
attorney to be signed on its behalf, and each of the undersigned Officers and
Directors in the capacity or capacities noted has hereunto set his or her hand
as of the date indicated below.
NATIONSBANK CORPORATION
(Registrant)
By: /s/ HUGH L. MCCOLL, JR.
HUGH L. MCCOLL, JR.
CHAIRMAN OF THE BOARD AND
CHIEF EXECUTIVE OFFICER
Dated: September 25, 1996
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<C> <S> <C>
/s/ HUGH L. MCCOLL, JR. Chairman of the Board, Chief Executive Officer September 25, 1996
and Director (Principal Executive Officer)
(HUGH L. MCCOLL, JR.)
/s/ JAMES H. HANCE, JR. Vice Chairman and Chief Financial Officer September 25, 1996
(Principal Financial Officer)
(JAMES H. HANCE, JR.)
/s/ MARC D. OKEN Executive Vice President and Chief September 25, 1996
Accounting Officer (Principal
(MARC D. OKEN) Accounting Officer)
</TABLE>
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<C> <S> <C>
/s/ RONALD W. ALLEN Director September 25, 1996
(RONALD W. ALLEN)
/s/ RAY C. ANDERSON Director September 25, 1996
(RAY C. ANDERSON)
/s/ WILLIAM M. BARNHARDT Director September 25, 1996
(WILLIAM M. BARNHARDT)
Director September 25, 1996
(THOMAS E. CAPPS)
/s/ CHARLES W. COKER Director September 25, 1996
(CHARLES W. COKER)
/s/ THOMAS G. COUSINS Director September 25, 1996
(THOMAS G. COUSINS)
/s/ ALAN T. DICKSON Director September 25, 1996
(ALAN T. DICKSON)
Director September 25, 1996
(W. FRANK DOWD, JR.)
/s/ PAUL FULTON Director September 25, 1996
(PAUL FULTON)
/s/ TIMOTHY L. GUZZLE Director September 25, 1996
(TIMOTHY L. GUZZLE)
/s/ W. W. JOHNSON Director September 25, 1996
(W. W. JOHNSON)
/s/ JOHN J. MURPHY Director September 25, 1996
(JOHN J. MURPHY)
/s/ JOHN C. SLANE Director September 25, 1996
(JOHN C. SLANE)
/s/ JOHN W. SNOW Director September 25, 1996
(JOHN W. SNOW)
/s/ MEREDITH R. SPANGLER Director September 25, 1996
(MEREDITH R. SPANGLER)
/s/ ROBERT H. SPILMAN Director September 25, 1996
(ROBERT H. SPILMAN)
</TABLE>
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<C> <S> <C>
/s/ RONALD TOWNSEND Director September 25, 1996
(RONALD TOWNSEND)
/s/ E. CRAIG WALL, JR. Director September 25, 1996
(E. CRAIG WALL, JR.)
/s/ JACKIE M. WARD Director September 25, 1996
(JACKIE M. WARD)
/s/ VIRGIL R. WILLIAMS Director September 25, 1996
(VIRGIL R. WILLIAMS)
</TABLE>
<PAGE>
<PAGE>
RESOLUTIONS OF
THE BOARD OF DIRECTORS OF
NATIONSBANK CORPORATION
September 25, 1996
Appointment of Committee
RESOLVED, that Paul J. Polking and Charles M. Berger hereby are
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 Corporation and any of
the following, to wit: the Principal Executive Officer, the Principal
Financial Officer, the Principal Accounting Officer, and any other officer
of the Corporation.
<PAGE>
CERTIFICATE OF SECRETARY
I, Allison Gilliam, Assistant Secretary of NationsBank Corporation, a
corporation duly organized and existing under the laws of the State of
North Carolina (the "Corporation"), do hereby certify that the foregoing is
a true and correct copy of the resolution duly adopted by the Board of
Directors of the Corporation at a meeting of the Board of directors held on
September 25, 1996, at which meeting a quorum was present and acting
throughout and that said resolution is in full force and effect and has not
been amended or rescinded as of the date hereof.
IN WITNESS WHEREOF, I have hereupon set my hand and affixed the seal of
the Corporation as of this 9th day of October, 1996.
/s/ Allison Gilliam
Assistant Secretary
(Corporate Seal)
2
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM T-1
STATEMENT OF ELIGIBILITY AND QUALIFICATION
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b) (2)_____
FIRST TRUST OF NEW YORK, NATIONAL
ASSOCIATION (Exact name of trustee as
specified in its charter)
13-3781471
(I.R.S. Employer Identification No.)
100 Wall Street, New York, NY 10005
(Address of principal executive offices) (Zip Code)
For information, contact:
Dennis Calabrese, President
First Trust of New York, National Association
100 Wall Street, 16th Floor
New York, NY 10005
(212) 361-2502
NATIONSBANK CORPORATION
(Exact name obligor as specified in its charter)
North Carolina 56-0906609
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
NationsBank Corporate Center 28255
Charlotte, North Carolina (Zip Code)
(Address of principal executive offices)
Debt Securities
(Title of the indenture securities)
<PAGE>
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising
authority to which it is subject.
Name Address
Comptroller of the Currency Washington D.C.
(b) Whether it is authorized to exercise corporate trust powers.
Yes
Item 2. Affiliations with Obligor
If the obligor is an affiliate of the trustee, describe each
such affiliation.
None
Item 16. List of Exhibits
Exhibit 1 Articles of Association of First Trust of New York, National
Association, incorporated herein by reference to Exhibit 1 of
Form T-1, Registration No. 33-83774.
Exhibit 2 Certificate of Authority to Commence Business for First
Trust of New York, National Association, incorporated herein
by reference to Exhibit 2 of Form T-1, Registration No.
33-83774.
Exhibit 3 Authorization of the Trustee to exercise corporate trust
powers for First Trust of New York, National Association,
incorporated herein by reference to Exhibit 3 of Form T-1,
Registration No. 33-83774.
Exhibit 4 By-Laws of First Trust of New York, National Association,
Incorporated herein by reference to Exhibit 4 of Form T-1,
Registration No. 33-55851.
Exhibit 5 Not applicable.
Exhibit 6 Consent of First Trust of New York, National Association,
required by Section 321(b) of the Act, incorporated herein by
reference to Exhibit 6 of Form T-1, Registration No. 33-83774.
Exhibit 7 Report of Condition of First Trust of New
York, National Association, as of the close
of business on March 31, 1996, published
pursuant to law or the requirements of its
supervising or examining authority.
-2-
<PAGE>
Exhibit 8 Not applicable.
Exhibit 9 Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, as amended, the trustee, First Trust of New York, National
Associationi, a national banking association organized and existing under the
laws of the United States of America, has duly caused this statement of
eligibility to be signed on its behalf by the undersigned, thereunto duly
authorized, all in The City of New York and State of New York, on the 9th day
of October, 1996.
FIRST TRUST OF NEW YORK,
NATIONAL ASSOCIATION
By
Geovanni Barris
Assistant Vice President
-3-
<PAGE>
Exhibit 7
First Trust of New York, N.A.
Statement of Financial Condition
As of 6/30/96
($000's)
Assets 6/30/96
Cash and Due From Depository Institutions $29,167
Federal Reserve Stock 3,658
Fixed Assets 707
Intangible Assets 82,730
Other Assets 8,084
Total Assets $124,346
Liabilities
other borrowed money 23
other Liabilities 6,184
Total Liabilities 6,207
Equity
Common and Preferred Stock 1,000
Surplus 120,932
Undivided Profits (3,793)
Total Liabilities and Equity Capital $124,346
To the best of the undersigned's determination, as of this date the above
financial information is true and correct.
First Trust of New York, N.A.
By:
Geovanni Barris
Assistant Vice President
Date: October 9, 1996
<PAGE>
<PAGE>
Exhibit 25.2
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------
FORM T-1
STATEMENT OF ELIGIBILITY UNDER THE
TRUST INDENTURE ACT OF 1939 OF A CORPORATION
DESIGNATED TO ACT AS TRUSTEE
------------------
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE
PURSUANT TO SECTION 305(b)(2) (3)___(3)
------------------
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
13-5160382
(I.R.S. employer identification no.)
48 Wall Street, New York, New York 10286
(Address of principal executive offices) (Zip Code)
-------------------
The Bank of New York
10161 Centurion Parkway
Towermarc Plaza, 2nd Floor
Jacksonville, Florida 32256
Attn: Ms. Sandra Carreker
(904) 998-4716
(Name, address and telephone number of agent for service)
--------------------
NATIONSBANK CORPORATION
(Exact name of obligor as specified in its charter)
North Carolina 56-0906609
State or other jurisdiction of (IRS employer
incorporation or organization identification no.)
NationsBank Corporate Center, Charlotte, North Carolina 28255 (Address of
principal executive offices) (Zip code)
--------------------
Debt Securities
(Title of the indenture securities)
<PAGE>
1. General Information.
Furnish the following information as to the trustee--
Name and address of each examining or supervising authority to which it is
subject.
Superintendent of Banks of the State of New York
2 Rector Street
New York, N.Y. 10006, and Albany, N.Y. 12203
Federal Reserve Bank of New York
33 Liberty Plaza
New York, N.Y. 10045
Federal Deposit Insurance Corporation
Washington, D.C. 20429
New York Clearing House Association
New York, N.Y.
Whether it is authorized to exercise corporate trust powers.
Yes.
2. Affiliations with Obligor.
If the obligor is an affiliate of the trustee, describe each such affiliation.
None. (See Note on page 4.)
16. List of Exhibits.
Exhibits identified in parentheses below, on file with the Commission, are
incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-29
under the Trust Indenture Act of 1939 (the "Act") and Rule 24 of the
Commission's Rules of Practice.
(1) A copy of the Organization Certificate of the Bank of New York (formerly
Irving Trust Company) as now in effect, which contains the authority to commence
business and a grant of powers to exercise corporate trust powers. (Exhibit 1 to
Amendment 1 to Form T-1 filed with
<PAGE>
Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with
Registration Statement No. 33-21672 and Exhibit 1 to Form T-1 filed with
Registration Statement No. 33-29637.)
(4) A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1 filed
with Registration Statement No. 33-31019.)
(6) The consent of the Trustee required by Section 321(b) of the Act. (Exhibit 6
to Form T-1 filed with Registration No. 33-44051.)
(7) A copy of the latest report of condition of the Trustee published pursuant
to law or the requirements of its supervising or examining authority.
NOTE
Inasmuch as this Form T-1 is filed prior to the ascertainment by the Trustee of
all facts on which to base a responsive answer to Item 2, the answer to said
Item is based on incomplete information.
Item 2 may, however, be considered as correct unless amended by an amendment to
this Form T-1.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New
York, a corporation organized and existing under the laws of the State of New
York, has duly caused this statement of eligibility to be signed on its behalf
by the undersigned, thereunto duly authorized, all in the City of Jacksonville
and the State of Florida, on the 9th day of October, 1996.
THE BANK OF NEW YORK
By: /s/ SANDRA CARREKER
___________________________
Sandra Carreker, Agent
<PAGE>
EXHIBIT 6 TO FORM T-1
CONSENT OF TRUSTEE
Pursuant to the requirements of Section 321(b) of the Trust Indenture
Act of 1939, in connection with the proposed issuance of NationsBank Corporation
Debt Securities, The Bank of New York hereby consents that reports of
examinations by Federal, State, Territorial or District Authorities may be
furnished by such authorities to the Securities and Exchange Commission upon
request therefor.
THE BANK OF NEW YORK
By: /S/ Sandra Carreker_____
Sandra Carreker, Agent
<PAGE>
EXHIBIT 7 TO FORM T-1
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries, a member of the Federal Reserve
System, at the close of business June 30, 1996, published in accordance with a
call made by the Federal Reserve Bank of this District pursuant to the
provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
in Thousands
ASSETS
<S> <C>
Cash and balances due from
depository institutions:
Noninterest-bearing balances
and currency and coin $3,650,068
Interest-bearing balances 738,260
Securities:
Held-to-maturity securities 784,969
Available-for-sale securities 2,033,407
Federal funds sold and securities purchased
under agreements to resell in
domestic offices of the bank:
Federal funds sold 3,699,232
Securities purchased under
agreements to resell 20,000
Loans and lease financing receivables:
Loans and leases,
net of unearned income 27,521,958
LESS: Allowance for loan and
lease losses 586,658
LESS: Allocated transfer
risk reserve 429
Loans and leases, net of unearned
income and allowance and reserve 27,521,958
<PAGE>
Assets held in trading accounts 678,844
Premises and fixed assets (including
capitalized leases) 608,217
Other real estate owned 50,599
Investments in unconsolidated
subsidiaries and associated
companies 235,670
Customers' liability to this bank
on acceptances outstanding 904,948
Intangible assets 450,230
Other assets 1,299,464
Total assets $42,675,866
LIABILITIES
Deposits:
In domestic offices $19,223,050
Noninterest-bearing 7,675,758
Interest-bearing 11,547,292
In foreign offices, Edge and
Agreement subsidiaries, and IBFs 11,527,685
Noninterest-bearing 48,502
Interest-bearing 11,479,183
Federal funds purchased and securities sold under
agreements to repurchase in
domestic offices of the bank
and of its Edge and Agreement
subsidiaries, and in IBFs:
Federal funds purchased 1,498,351
Securities sold under agreements
to repurchase 126,974
Demand notes issued to the
U.S. Treasury 231,865
Trading liabilities 479,390
Other borrowed money:
With original maturity of one year
or less 2,521,578
With original maturity of more
than one year 20,780
<PAGE>
Bank's liability on acceptances
executed and outstanding 905,850
Subordinated notes and debentures 1,020,400
Other liabilities 1,543,657
Total liabilities 39,099,580
EQUITY CAPITAL
Common stock 942,284
Surplus 525,666
Undivided profits and capital
reserves 2,124,231
Net unrealized holding gains (losses)
on available-for-sale securities (8,063)
Cumulative foreign currency
translation adjustments
(7,832)
Total equity capital 3,576,286
Total liabilities and equity capital $42,675,866
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this Report
of Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
J. Carter Bacot )
Thomas A. Renyi ) Directors
Alan R. Griffith )
<PAGE>
