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Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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(NationsBank logo appears here)
NationsBank Corporation (Exact name of registrant as specified in its charter)
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<CAPTION>
North Carolina 56-0906609
<S> <C>
(State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.)
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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)
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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)
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Copies to:
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<S> <C>
BOYD C. CAMPBELL, JR. JAMES R. TANENBAUM
Smith Helms Mulliss & Moore, L.L.P. Stroock & Stroock & Lavan LLP
201 North Tryon Street 180 Maiden Lane
Charlotte, North Carolina 28202 New York, New York 10038
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Approximate date of commencement of the proposed sale to the public:
From time to time after the effective date of this Registration Statement.
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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 amendent 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]
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CALCULATION OF REGISTRATION FEE
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Title of each Proposed maximum Proposed maximum Amount of
class of securities Amount to be offering price aggregate registration
to be registered registered (1)(4) per unit (2) offering price (1)(2) fee
<S> <C> <C> <C> <C>
Debt Securities (3) N/A (3) N/A
Warrants (5) N/A N/A N/A
Units (6) N/A N/A N/A
Preferred Stock
Depositary Shares (3) N/A (3) N/A
Common Stock (3)(7) N/A (3) N/A
Total $10,000,000,000 100% $10,000,000,000 $2,950,000
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(1) In no event will the aggregate initial offering price of the Debt
Securities, Warrants, Units, Preferred Stock, Depositary Shares and Common
Stock issued under this registration statement exceed $10,000,000,000, 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, Depositary Shares, or Units or upon
exercise of Warrants, as the case may be. No separate consideration will
be received for any Debt Securities, Preferred Stock, Depositary Shares or
Common Stock so issued.
(4) Includes an indeterminate amount of Debt Securities, an indeterminate
number of shares of Preferred Stock, Depositary Shares or Common Stock and
an indeterminate number of Warrants and Units as may be offered or sold in
connection with market making activities by affiliates of the Registrant.
(5) There are being registered hereby such indeterminate number of Warrants as
may be issued by the Registrant at indeterminate prices. Such Warrants may
be issued together with any Debt Securities or other Warrants. Warrants
may be exercised to purchase Debt Securities registered hereby or to
purchase or sell (i) securities of an entity unaffiliated with the
Registrant, a basket of such securities, an index or indices of such
securities or any combination of the above, (ii) currencies or currency
units or (iii) commodities.
(6) There are being registered hereby such indeterminate number of Units as may
be issued by the Registrant at indeterminate prices. Units may consist of
one or more Warrants and Debt Securities or any combination of the above.
(7) The aggregate amount of Common Stock registered hereunder is limited to
that which is permissible under Rule 415(a)(4) of the Securities Act.
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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.
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EXPLANATORY NOTES
This Registration Statement contains two forms of Prospectus of
NationsBank Corporation ("NationsBank"): one to be used in connection with the
offering and sale of Debt Securities, Warrants, or Units, including any
securities into which such securities may be convertible, and one 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.
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(A red herring appears here with the following information:)
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.
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED , 1998
PROSPECTUS [DEBT]
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(NationsBank logo appears here)
Debt Securities
Warrants
Units
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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"). 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. NationsBank
also may issue and sell warrants to purchase Debt Securities ("Debt Warrants")
or to purchase or sell (i) securities of an entity unaffiliated with the
Corporation, a basket of such securities, an index or indices of such
securities or any combination of the above, (ii) currencies or currency units
or (iii) commodities ("Universal Warrants", and together with Debt Warrants,
the "Warrants"), as set forth in the applicable Prospectus Supplement (as
defined below) on terms to be determined at the time of sale. The Corporation
may satisfy its obligations, if any, with respect to any Universal Warrants by
delivering underlying securities, currencies or commodities or, in the case of
underlying securities or commodities, the cash value thereof, as set forth in
the applicable Prospectus Supplement. Debt Securities and Warrants or any
combination thereof may be offered in the form of Units ("Units"). Units may be
issued as Definitive Units or Book-Entry Units (each as defined herein). The
Debt Securities, Warrants and Units are collectively referred to herein as
"Securities".
NationsBank may sell up to $10,000,000,000 in aggregate initial offering
price of Securities (or the U.S. dollar equivalent thereof if any of the
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 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 Securities may be sold for U.S. dollars, foreign denominated currency
or currency units; principal of and any interest on Debt Securities and cash
amounts payable with respect to Warrants or Units may likewise be payable in
U.S. dollars, foreign currencies or currency units, in each case, as the
Corporation specifically designates.The accompanying Prospectus Supplement will
set forth the specific terms of each series of Securities.
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 or
remarketing of the 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. Any such underwriters, agents or
remarketing agents may include NationsBanc Montgomery Securities LLC ("NMS"),
or other affiliates of the Corporation.
The net proceeds to the Corporation from such sale also will be set forth
in such Prospectus Supplement or pricing supplement.
Following the initial distribution of any such Securities, NMS or other
affiliates of the Corporation may offer and sell previously issued Securities
in the course of their business as a broker-dealer and may act as a principal
or agent in such transactions. This Prospectus and the accompanying Prospectus
Supplement may be used in connection with such transactions. Any such sales
will be made at negotiated prices relating to prevailing market prices at time
of sale.
This Prospectus may not be used to consummate sales of Securities unless
accompanied by a Prospectus Supplement.
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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.
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The date of this Prospectus is , 1998
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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, 1997 as filed March 13, 1998;
(b) The Corporation's Current Reports on Form 8-K filed January 14, 1998,
January 22, 1998, February 3, 1998, March 13, 1998, March 23, 1998, April
15, 1998, April 16, 1998 and April 17, 1998 (as amended by Form 8-K/A
filed April 24, 1998); and
(c) The description of the Corporation's Common Stock contained in its
registration statement filed pursuant to Section 12 of the 1934 Act, as
modified by the Corporation's Current Report on Form 8-K filed on January
22, 1998.
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 later of (i) the termination of the offering of the Securities offered
hereby or (ii) the date on which NMS or any other affiliate of the Corporation
ceases offering and selling previously issued Securities 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 Exchange Inc., 301
Pine Street, San Francisco, California 94104.
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE SECURITIES
DESCRIBED HEREIN. SPECIFICALLY, THE UNDERWRITERS OR AGENTS SPECIFIED IN THE
RELEVANT PROSPECTUS SUPPLEMENT OR PRICING SUPPLEMENT MAY OVERALLOT IN
CONNECTION WITH THE OFFERING, AND MAY BID FOR, AND PURCHASE, THE SECURITIES OR
ANY SECURITIES THE PRICES OF WHICH MAY BE USED TO DETERMINE PAYMENTS
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ON THE SECURITIES IN THE OPEN MARKET. FOR A DESCRIPTION OF THESE ACTIVITIES,
SEE "PLAN OF DISTRIBUTION."
NATIONSBANK CORPORATION
General
NationsBank is a North Carolina corporation and a multi-bank holding
company registered under the Bank Holding Company Act of 1956, as amended (the
"Act"), with its principal assets being the stock of its subsidiaries. Through
its banking subsidiaries (the "Banks") and various non-banking subsidiaries,
the Corporation provides banking and certain nonbanking financial services and
products primarily throughout the Mid-Atlantic (Maryland, Virginia and the
District of Columbia), the Midwest (Illinois, Iowa, Kansas and Missouri), the
Southeast (Florida, Georgia, Kentucky, North Carolina, South Carolina and
Tennessee) and the Southwest (Arkansas, New Mexico, Oklahoma and Texas). The
principal executive offices of the Corporation are located at NationsBank
Corporate Center in Charlotte, North Carolina 28255. The Corporation's
telephone number is (704) 386-5000.
Operations
The Corporation provides a diversified range of banking and certain
nonbanking financial services and products through its various subsidiaries.
The Corporation manages its business activities through three major business
units: General Bank, Global Finance and Financial Services.
The General Bank provides comprehensive retail banking services for
individuals and businesses through approximately 3,000 banking centers and
approximately 7,000 automated teller machines located throughout the
Corporation's franchise in 16 states and the District of Columbia. These
services include the origination and servicing of residential mortgage loans,
the issuance and servicing of credit cards, indirect lending, dealer finance
and certain insurance services as well as full-service and discount brokerage
and investment advisory and investment management services. Also in the General
Bank are businesses which provide advisory services to the Nations Funds family
of mutual funds and asset management, banking and trust services.
Global Finance provides a broad array of banking, bank-related and
investment banking products and services to domestic and international
corporations, institutions and other customers. The Global Finance group serves
as a principal lender and investor, as well as an advisor, 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 consulting are representative of the services
provided. These services are provided through various domestic and
international offices. Through NMS, Global Finance is a primary dealer of U.S.
Government securities and underwrites, distributes and makes markets in
high-grade and high-yield debt securities and equity securities and in
derivative products. Major centers for Global Finance activities are Charlotte,
Chicago, London, New York, San Francisco, Singapore and Tokyo.
Financial Services is comprised of NationsCredit Consumer Corporation,
NationsCredit Commercial Corporation, EquiCredit Corporation and Oxford
Resources Corp. NationsCredit Consumer Corporation, which has 268 branches in
41 states, provides personal, mortgage and automobile loans to consumers, and
retail finance programs to dealers. NationsCredit Commercial Corporation
specializes in equipment loans and leases; loans for debt restructuring,
mergers and acquisitions and working capital; real estate, golf/recreational
and healthcare financing; and inventory financing to manufacturers,
distributors and dealers. EquiCredit Corporation provides sub-prime mortgage
and home equity loans directly and through correspondents and Oxford Resources
provides lease financing for purchasers of new and used cars.
As part of its operations, the Corporation regularly evaluates the
potential acquisition of, and holds discussions with, various financial
institutions and other businesses of a type eligible for bank holding company
ownership or control. In addition, the Corporation 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. The Corporation also regularly considers the potential disposition
of certain of its assets, branches, subsidiaries or lines of businesses. As a
general rule, the Corporation publicly announces any material acquisitions or
dispositions when a definitive agreement has been reached.
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Government Supervision and Regulation
General
As a registered bank holding company, the Corporation is subject to the
supervision of, and to regular inspection by, the Board of Governors of the
Federal Reserve System (the "Federal Reserve Board"). The Banks are principally
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 and state
regulatory agencies. In addition to banking laws, regulations and regulatory
agencies, the Corporation 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 operations
and management of the Corporation and its ability to make distributions. The
following discussion summarizes certain aspects of those laws and regulations
that affect the Corporation.
The activities of the Corporation, 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 the Corporation, are
required to obtain prior approval of the Federal Reserve Board to engage in any
new activity or to acquire more than 5% of any class of voting stock of any
company.
Bank holding companies are also required 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 acquisitions under state law, but subject to any state requirement that
the bank to be acquired 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, thereby creating interstate branches. This provision, which
became effective June 1, 1997, allowed each state, prior to the effective date,
the opportunity to "opt out" of this provision, thereby prohibiting interstate
branching within that state. Of those states in which the Banks are located,
only Texas has adopted legislation purporting to "opt out" of the interstate
branching provisions (which Texas law currently expires on September 2, 1999).
Furthermore, pursuant to the Interstate Banking and Branching Act, a bank is
now able to open new branches in a state in which it does not already have
banking operations if such state enacts a law permitting such de novo
branching. To the extent permitted under these laws, the Corporation plans to
consolidate its banking subsidiaries (with the exception of NationsBank of
Delaware, N.A.) into a single bank as soon as practicable. The Corporation
currently operates one interstate bank (i.e., a bank with banking centers in
more than one state) which is NationsBank, N.A., headquartered in Charlotte,
North Carolina, with offices in Arkansas, Florida, Georgia, Illinois, Iowa,
Kansas, Maryland, Missouri, New Mexico, North Carolina, Oklahoma, South
Carolina, Texas, Virginia and the District of Columbia. Separate banks continue
to operate in Delaware, Florida, Georgia, Kentucky (which the Corporation has
agreed to sell), Tennessee and Texas. As previously described, the Corporation
regularly evaluates merger and acquisition opportunities, and it anticipates
that it will continue to evaluate such opportunities.
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. The likelihood and
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timing of any such proposals or bills and the impact they might have on the
Corporation and its subsidiaries cannot be determined at this time.
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.
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 December 31, 1997 were 6.50% and
10.89%, 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 December 31, 1997 was
5.57%. Management believes that the Corporation meets its leverage ratio
requirement.
On January 9, 1998, the Corporation completed its merger with Barnett
Banks, Inc. a multi-bank holding company headquartered in Jacksonville,
Florida, (the "Barnett Merger"). On April 16, 1998, the Corporation filed a
Current Report on Form 8-K containing restated consolidated financial
statements of the Corporation reflecting the Barnett Merger (accounted for as a
pooling of interests). Capital ratios for 1997 included herein have not been
restated to reflect the Barnett Merger. Under regulatory guidelines, Barnett
Banks, Inc. was considered well capitalized on December 31, 1997.
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,
each of the Banks is considered well capitalized.
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Banking agencies have also adopted final regulations which mandate that
regulators take into consideration (i) concentrations of credit risk; (ii)
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); and (iii) 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. That evaluation will be made as a part of
the institution's regular safety and soundness examination. In addition, the
banking agencies have amended their regulatory capital guidelines to
incorporate a measure for market risk. In accordance with the amended
guidelines, the Corporation and any Bank with significant trading activity (as
defined in the amendment) must incorporate a measure for market risk in their
regulatory capital calculations effective for reporting periods after January
1, 1998. The revised guidelines are not expected to have a material impact on
the Corporation or the Banks' regulatory capital ratios or their well
capitalized status.
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. Each of the Banks is subject to various general regulatory policies and
requirements relating to the payment of dividends, including requirements to
maintain capital above regulatory minimums. The appropriate federal regulatory
authority is authorized to determine under certain circumstances relating to
the financial condition of the bank or bank holding company that the payment of
dividends would be an unsafe or unsound practice and to prohibit payment
thereof.
In addition to the foregoing, the ability of the Corporation 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. The right of the Corporation, 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. Similarly, under the cross-guarantee provisions of the Federal Deposit
Insurance Act, 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 the
registrant 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. 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.
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RATIOS OF EARNINGS TO FIXED CHARGES
The following are the Corporation's consolidated ratios of earnings to
fixed charges for each of the years in the five-year period ended December 31,
1997:
<TABLE>
<CAPTION>
Year Ended
December 31,
--------------------------------------------
1997 1996 1995 1994 1993
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges:
Excluding interest on deposits ......... 2.0 2.0 1.8 2.0 2.6
Including interest on deposits ......... 1.5 1.5 1.4 1.5 1.6
</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 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 NMS or other affiliates of NationsBank. The Prospectus
Supplement with respect to a particular offering of a series of 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 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.
Securities may also be offered and sold, if so indicated in the Prospectus
Supplement, in connection with a remarketing after their purchase, in
accordance with their terms, by one or more firms, including NMS or other
affiliates of the Corporation ("remarketing agents"), acting as principal for
their accounts or an agent for the Corporation. Any remarketing agent will be
identified and the terms of its agreement with the Corporation described in a
Prospectus Supplement.
If so indicated in the applicable Prospectus Supplement relating to Debt
Securities, 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
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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 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 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 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.
In order to facilitate the offering of the Securities, the underwriters
may engage in transactions that stabilize, maintain or otherwise affect the
price of the Securities or any other securities the prices of which may be used
to determine payments on such Securities. Specifically, the underwriters may
overallot in connection with the offering, creating a short position in the
Securities for their own accounts. In addition, to cover overallotments or to
stabilize the price of the Securities or of any such other securities, the
underwriters may bid for, and purchase, the Securities or any such other
securities in the open market. Finally, in any offering of the Securities
through a syndicate of underwriters, the underwriting syndicate may reclaim
selling concessions allowed to an underwriter or a dealer for distributing the
Securities in the offering if the syndicate repurchases previously distributed
Securities in transactions to cover syndicate short positions, in stabilization
transactions or otherwise. Any of these activities may stabilize or maintain
the market price of the Securities above independent market levels. The
underwriters are not required to engage in these activities, and may end any of
these activities at any time.
Under agreements entered into with the Corporation, underwriters, dealers,
agents and remarketing 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.
NMS is a broker-dealer and a direct subsidiary of the Corporation. Each
initial offering and any remarketing of Securities involving NMS or any other
affiliate of the Corporation will be conducted in compliance with the
requirements of Rule 2720 of the National Association of Securities Dealers,
Inc. (the "NASD") regarding a NASD member firm's distribution of the securities
of an affiliate. Following the initial distribution of the Securities, NMS may
offer and sell such Securities in secondary markets transactions at negotiated
prices relating to prevailing prices at the time of sale or otherwise. NMS may
act as principal or agent in such transactions. This Prospectus and related
Prospectus Supplements may be used by NMS in connection with such transactions.
NMS will not execute a transaction in the Securities in a discretionary
account without the prior written specific approval of NMS's customer. NMS 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.
Futhermore, NMS
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<PAGE>
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 NMS, by virtue of its affiliation with the Corporation, is aware of
material non-public information relating to the Corporation. In such instance,
NMS 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 broker-dealer will do so at any time when NMS
discontinues its market-making activities.
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
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 U.S.
Bank Trust 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 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
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<PAGE>
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 series of
Debt Securities, including: (i) the designation of the particular series; (ii)
the aggregate principal amount of such series that may be authenticated and
delivered under the applicable Indenture; (iii) 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; (iv) the date or dates on which the principal of the Debt Securities
of such series is payable; (v) 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; (vi) 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; (vii) 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; (viii) 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; (ix) 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; (x) 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; (xi) 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; (xii) whether the amount of
payments of principal of (and premium, if any) or interest on such Debt
Securities may be determined with reference to an index, formula or other
method (which index, formula or method may be based on one or more currencies,
commodities, equity indices or other indices) and the manner in which such
amount shall be determined; (xiii) whether the Debt Securities will be issued
in book-entry only form; (xiv) 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; (xv) 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; (xvi)
any provisions relating to the extension of maturity of, or the renewal of,
Debt Securities of such series; and (xvii) 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 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.
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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
purchasable 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 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
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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 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.
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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).
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
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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).
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
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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
U.S. Bank Trust 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.
DESCRIPTION OF WARRANTS
The Corporation may issue, together with Debt Securities or separately,
Debt Warrants for the purchase of Debt Securities on terms to be determined at
the time of issuance. The Corporation may also issue Universal Warrants to
purchase or sell (i) securities of an entity unaffiliated with the Corporation,
a basket of such securities, an index or indices of such securities or any
combination of the above, (ii) currencies or currency units or (iii)
commodities, on terms to be determined at the time of sale. The Corporation may
satisfy its obligations, if any, with respect to any Universal Warrants by
delivering the underlying securities, currencies or commodities or, in the case
of underlying securities or commodities, the cash value thereof, as set forth
in the applicable Prospectus Supplement. Warrants may be offered separately or
together with one or more additional Warrants or Debt Securities or any
combination thereof in the form of Units, as set forth in the applicable
Prospectus Supplement. If Warrants are issued as part of a Unit, the
accompanying Prospectus Supplement will specify whether such Warrants may be
separated from the other Securities in such Unit prior to the Warrants'
expiration date.
The Warrants are to be issued under one or more Warrant Agreements (each,
a "Warrant Agreement") to be entered into between the Corporation and a bank or
trust company, as Warrant Agent (the "Warrant Agent"), and may be issued in one
or more series, all as shall be set forth in the Prospectus Supplement relating
thereto. The forms of Warrant Agreement for the Warrants are filed as exhibits
to the Registration Statement of which this Prospectus is a part. The following
summaries of certain provisions of the applicable Warrant Agreement and the
Warrants do not purport to be complete and such summaries are subject to the
detailed provisions of such Warrant Agreement to which reference is hereby made
for a full description of such provisions, including the definition of certain
terms used herein, and for other information regarding the Warrants. Wherever
particular provisions of the Warrant Agreement are referred to, such provisions
are incorporated by reference as a part of the statements made, and the
statements are qualified in their entirety by such reference.
General
The particular terms of each series of Warrants to be offered and sold
will be described in the Prospectus Supplement relating to such series of
Warrants, including: (i) the specific designation and aggregate number of and
the price at which the Warrants will be issued; (ii) the currency or currency
unit for which the Warrants may be purchased; (iii) the date on which the right
to exercise the Warrants shall commence
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and the date (the "Warrant Expiration Date") on which such right shall expire
or, if the Warrants are not continuously exercisable throughout such period,
the specific date or dates on which they will be exercisable (each, a "Warrant
Exercise Date," which term shall also mean, with respect to Warrants
continuously exercisable for a period of time, every date during such period);
(iv) whether any Warrants will be issued in global or definitive form or both;
(v) any applicable United States federal income tax consequences; (vi) the
identity of the Warrant Agent in respect of the Warrants and of any other
depositaries, execution or paying agents, transfer agents, registrars or
determination or other agents; (vii) the proposed listing, if any, of the
Warrants or the securities purchasable upon exercise thereof on any securities
exchange; (viii) whether the Warrants are to be sold separately or with other
Securities as part of Units; and (ix) any other terms of the Warrants.
The particular terms of each series of Debt Warrants will be described in
the Prospectus Supplement relating to such series of Debt Warrants, including:
(i) the designation, aggregate principal amount, currency or composite currency
unit and terms of the Debt Securities that may be purchased upon exercise of
the Warrants, (ii) if applicable, the designation and terms of the Debt
Securities with which the Warrants are issued and the number of the Debt
Warrants issued with each of such Debt Securities, (iii) if applicable, the
date on and after which the Securities and the related Debt Securities will be
separately transferable and (iv) the principal amount of Debt Securities
purchasable upon exercise of each Debt Warrant, the price at which and the
currency or currency unit in which such principal amount of Debt Securities may
be purchased upon such exercise and the method of such exercise.
The particular terms of each series of Universal Warrants will be
described in the Prospectus Supplement relating to such series of Universal
Warrants, including: (i) whether such Universal Warrants are put Warrants or
call Warrants; (ii) (a) the specific security, basket of securities, index or
indices of securities or combination of the above, (b) currencies or currency
units or (c) commodities (and, in each case, the amount thereof or the method
for determining the same) purchasable or saleable upon exercise of each
Universal Warrant; (iii) the price at which and the currency or currency unit
with which such underlying securities, currencies or commodities may be
purchased or sold upon such exercise (or the method of determining the same);
(iv) whether such exercise price may be paid in cash, by the exchange of any
other Security offered with such Universal Warrants or both and the method of
such exercise; and (v) whether the exercise of such Universal Warrants is to be
settled in cash or by delivery of the underlying securities or commodities or
both.
Warrants of each series will be evidenced by Warrant certificates
("Warrant Certificates") in registered form, which may be global Warrants or
definitive Warrants, as specified in the applicable Prospectus Supplement.
At the option of the holder upon request confirmed in writing, and subject
to the terms of the applicable Warrant Agreement, Warrants in definitive form
may be presented for exchange and for registration of transfer (with the form
of transfer endorsed thereon duly executed) at the corporate trust office of
the Warrant Agent for such series of Warrants (or any other office indicated in
the Prospectus Supplement relating to such series of Warrants) without service
charge and upon payment of any taxes and other governmental charges as
described in such Warrant Agreement. Such transfer or exchange will be effected
only if the Warrant Agent for such series of Warrants is satisfied with the
documents of title and identity of the person making the request.
Modifications
Each Warrant Agreement and the terms of the Warrants and the Warrant
Certificates may be amended by the Corporation and the Warrant Agent, without
the consent of the holders, for the purpose of curing any ambiguity, or of
curing, correcting or supplementing any defective or inconsistent provision
therein or in any other manner which the Corporation may deem necessary or
desirable and which will not adversely affect the interests of the affected
holders in any material respect.
The Corporation and any Warrant Agent may also modify or amend the Warrant
Agreement between them and the terms of the Warrants issued thereunder, with
the consent of the owners of not less than a majority in number of the then
outstanding unexercised Warrants affected, provided that no such modification
or amendment that changes the exercise price of the Warrants, reduces the
amount receivable upon exercise, cancellation or expiration, shortens the
period of time during which the Warrants may be exercised
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or otherwise materially and adversely affects the rights of the owners of the
Warrants or reduces the percentage of outstanding Warrants, the consent of
whose owners is required for modification or amendment of the applicable
Warrant Agreement or the terms of the Warrants issued thereunder, may be made
without the consent of the owners affected thereby.
Enforceability of Rights of Warrantholders; Governing Law
The Warrant Agents will act solely as agents of the Corporation in
connection with the Warrant Certificates and will not assume any obligation or
relationship of agency or trust for or with any holders of Warrant Certificates
or beneficial owners of Warrants. Any holder of Warrant Certificates and any
beneficial owner of Warrants may, without the consent of the Warrant Agent, any
other holder or beneficial owner, the relevant Trustee, the holder of any Debt
Securities or other securities issuable upon exercise of Warrants or, if
applicable, the Euroclear Operator (as defined below) enforce by appropriate
legal action, on its own behalf, its right to exercise the Warrants evidenced
by such Warrant Certificates, in the manner provided therein and in the
applicable Warrant Agreement. No holder of any Warrant Certificate or
beneficial owner of any Warrants shall be entitled to any of the rights of a
holder of the Debt Securities or other securities purchasable upon exercise of
such Warrants, including, without limitation, the right to receive the payment
of dividends, principal of or premium, if any, or interest, if any, on such
Debt Securities or other securities or to enforce any of the covenants or
rights in the relevant Indenture or any other similar agreement. The Warrants
and each Warrant Agreement will be governed by, and construed in accordance
with, the laws of the State of New York.
Unsecured Obligations of the Corporation
The Warrants are unsecured contractual obligations of the Corporation and
will rank pari passu with the Corporation's other unsecured contractual
obligations and with the Corporation's unsecured and unsubordinated debt. Most
of the assets of the Corporation are owned by its subsidiaries. Therefore, the
Corporation's rights and the rights of its creditors, including Warrantholders,
to participate in the distribution of assets of any subsidiary upon such
subsidiary's liquidation or recapitalization will be subject to the prior
claims of such subsidiary's creditors, except to the extent that the
Corporation may itself be a creditor with recognized claims against the
subsidiary. The ability of the Corporation to meet its obligations under the
Warrants may be affected by the ability of the Banks to pay dividends. The
ability of the Banks, as well as 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."
DESCRIPTION OF UNITS
As specified in the applicable Prospectus Supplement, Units will consist
of one or more Warrants and Debt Securities or any combination thereof. The
particular terms of each series of Units will be described in the Prospectus
Supplement relating to such series of Units, including: (i) all terms of Units
and of the Warrants and Debt Securities, or any combination thereof, comprising
such Units, including whether and under what circumstances the Securities
comprising such Units may or may not be traded separately, (ii) a description
of the terms of any agreement (a "Unit Agreement") to be entered into between
the Corporation and a bank or trust company as Unit Agent (the "Unit Agent")
governing the Units and (iii) a description of the provisions for the payment,
settlement, transfer or exchange of the Units.
REGISTRATION AND SETTLEMENT
DTC
If so specified in an applicable Prospectus Supplement, all or any portion
of the Securities of a series may be issued in book-entry form represented by
one or more global 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. Accordingly, Cede & Co. is expected to be the holder of record of the
Securities.
Under the book-entry system of DTC, purchases of 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
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Global Security, DTC will credit, on its book-entry registration and transfer
system, the respective principal amounts of the individual 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 Securities (or by the Corporation, if such 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.
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 Securities represented by such Global Security for all
purposes under the applicable Indenture, Warrant Agreement or Unit Agreement.
Except as provided below, owners of beneficial interests in a Global Security
will not be entitled to have Securities registered in their names, will not
receive or be entitled to receive physical delivery of such Securities in
certificated form and will not be considered the owners or holders thereof
under the applicable Indenture, Warrant Agreement or Unit Agreement.
Accordingly, in order to exercise any rights of a holder of the Securities
under the applicable Indenture, Warrant Agreement or Unit Agreement, each
person owning a beneficial interest in the Global Security representing such
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, 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 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
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 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, and any
payments to holders with respect to Warrants or Units 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 payment 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 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 Trustees, the Warrant Agents, the Unit Agents or any other
agent of the Corporation, agent of the Trustees or agent of the Warrant Agents
or Unit Agents 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 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
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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. Direct Participants in DTC 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 Participants and by the New York Stock Exchange, Inc., the
American Stock Exchange, Inc. and the NASD. 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 & 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 Securities of a particular series and a successor
depositary is not appointed by the Corporation within 90 days, the Corporation
will issue Securities of the series in certificated form in exchange for
beneficial interests in the Global Security representing such Securities. In
addition, the Corporation may at any time determine not to have Securities of a
series represented by Global Securities and, in such event, will issue
Securities of the series in certificated form in exchange for beneficial
interests in the Global Security representing such Securities. Any Securities
issued in certificated form in exchange for such beneficial interests in the
Global Security will be registered in such name or names as DTC shall instruct
the relevant Trustee, Warrant Agent, Unit Agent or other relevant agent of the
Corporation, the Trustees, the Warrant Agents or the Unit Agents. It is
expected that such instructions will be based upon directions received by DTC
from participants with respect to ownership of beneficial interests in such
Global Security.
Cedel Bank and Euroclear
If so specified in the applicable Prospectus Supplement, Securities of a
series to be issued in book-entry form and to be sold or traded outside the
United States may be represented by one or more Global Securities held through
Cedel Bank, soci-t- 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
defined herein), respectively, on the books of their respective depositaries
(each, a "Depositary"), which in turn will hold such positions in customers'
securities accounts in the Depositaries' names on the books of DTC.
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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; however,
cross-market transactions 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 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 Bank Participants") and facilitates the clearance and settlement of
securities transactions between Cedel Bank Participants through electronic
book-entry changes in accounts of Cedel Bank 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 Bank 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 Bank
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 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 Bank 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 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.
20
<PAGE>
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 Securities of a series held through Cedel
Bank or Euroclear will be credited to the cash accounts of Cedel Bank
Participants or Euroclear Participants in accordance with the relevant 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 Securities under the applicable
Indenture, Warrant Agreement or Unit Agreement on behalf of a Cedel Bank
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 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 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 LLP, New York, New York. As
of the date of this Prospectus, certain members of Smith Helms Mulliss & Moore,
L.L.P. beneficially own approximately 160,000 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, 1997 and the Corporation's Current Report on
Form 8-K filed April 16, 1998, 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.
The consolidated financial statements of BankAmerica Corporation at
December 31, 1997 and 1996, and for the three years ended December 31, 1997,
incorporated herein by reference from the Corporation's Current Report on Form
8-K filed on April 17, 1998 (as amended by Form 8-K/A filed April 24, 1998),
have been audited by Ernst & Young LLP, independent auditors, as set forth in
their report thereon incorporated herein in reliance upon such report given on
the authority of such firm as experts in accounting and auditing.
21
<PAGE>
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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, NationsBanc Montgomery Securities LLC or any
other affiliate of 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. This
Prospectus and related Prospectus Supplements may be used by NationsBanc
Montgomery Securities LLC, a broker-dealer and a direct wholly owned subsidiary
of the Corporation or any other affiliates of the Corporation in connection with
offers and sales related to secondary market transactions.
--------------------------
TABLE OF CONTENTS
<TABLE>
<S> <C>
Prospectus Page
----
Incorporation of Certain Documents
by Reference ............................. 2
Available Information ....................... 2
NationsBank Corporation ..................... 3
Use of Proceeds ............................. 6
Ratios of Earnings to Fixed Charges ......... 7
Plan of Distribution ........................ 7
Description of Debt Securities .............. 9
Description of Warrants ..................... 15
Description of Units ........................ 17
Registration and Settlement ................. 17
Legal Opinions .............................. 21
Experts ..................................... 21
</TABLE>
$10,000,000,000
(NationsBank logo appears here)
Debt Securities
Warrants
Units
-----------------------------------
PROSPECTUS
-----------------------------------
, 1998
- --------------------------------------------------------------------------------
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<PAGE>
(A red herring appears here with the following information:)
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 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.
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED , 1998
PROSPECTUS [EQUITY]
(NationsBank logo appears here)
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
$10,000,000,000 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), warrants or units (collectively, 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 or
remarketing 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. Any such underwriters, agents
or remarketing agents may include NationsBanc Montgomery Securities LLC
("NMS"), or other affiliates of the Corporation. The net proceeds to the
Corporation from such sale also will be set forth in such Prospectus
Supplement.
Following the initial distribution of any such Securities, NMS or other
affiliates of the Corporation may offer and sell previously issued Securities
in the course of their business as a broker-dealer and may act as a principal
or agent in such transactions. This Prospectus and the accompanying Prospectus
Supplement may be used in connection with such transactions. Any such sales
will be made at negotiated prices relating to prevailing market prices at time
of sale.
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 , 1998.
<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, 1997 as filed March 13, 1998;
(c) The Corporation's Current Reports on Form 8-K filed January 14, 1998,
January 22, 1998, February 3, 1998, March 13, 1998, March 23, 1998, April
15, 1998, April 16, 1998 and April 17, 1998 (as amended by Form 8-K/A
filed April 24, 1998); and
(d) The description of the Corporation's Common Stock contained in its
registration statement filed pursuant to Section 12 of the 1934 Act, as
modified by the Corporation's Current Report on Form 8-K filed on January
22, 1998.
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 later of (i) the termination of the offering of the Securities offered
hereby or (ii) the date on which NMS or any other affiliate of the Corporation
ceases the offering and selling previously issued Securities 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 Exchange Inc., 301
Pine Street, San Francisco, California 94104.
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE SECURITIES
DESCRIBED HEREIN. SPECIFICALLY, THE UNDERWRITERS OR AGENTS SPECIFIED IN THE
RELEVANT PROSPECTUS SUPPLEMENT OR PRICING SUPPLEMENT MAY OVERALLOT IN
CONNECTION WITH THE OFFERING, AND MAY BID FOR, AND PURCHASE, SUCH SECURITIES.
FOR A DESCRIPTION OF THESE ACTIVITIES, SEE "PLAN OF DISTRIBUTION."
2
<PAGE>
NATIONSBANK CORPORATION
General
NationsBank is a North Carolina corporation and a multi-bank holding
company registered under the Bank Holding Company Act of 1956, as amended (the
"Act"), with its principal assets being the stock of its subsidiaries. Through
its banking subsidiaries (the "Banks") and various non-banking subsidiaries,
the Corporation provides banking and certain nonbanking financial services and
products primarily throughout the Mid-Atlantic (Maryland, Virginia and the
District of Columbia), the Midwest (Illinois, Iowa, Kansas and Missouri), the
Southeast (Florida, Georgia, Kentucky, North Carolina, South Carolina and
Tennessee) and the Southwest (Arkansas, New Mexico, Oklahoma and Texas). The
principal executive offices of the Corporation are located at NationsBank
Corporate Center in Charlotte, North Carolina 28255. The Corporation's
telephone number is (704) 386-5000.
Operations
The Corporation provides a diversified range of banking and certain
nonbanking financial services and products through its various subsidiaries.
The Corporation manages its business activities through three major business
units: General Bank, Global Finance and Financial Services.
The General Bank provides comprehensive retail banking services for
individuals and businesses through approximately 3,000 banking centers and
approximately 7,000 automated teller machines located throughout the
Corporation's franchise in 16 states and the District of Columbia. These
services include the origination and servicing of residential mortgage loans,
the issuance and servicing of credit cards, indirect lending, dealer finance
and certain insurance services as well as full-service and discount brokerage
and investment advisory and investment management services. Also in the General
Bank are businesses which provide advisory services to the Nations Funds family
of mutual funds and asset management, banking and trust services.
Global Finance provides a broad array of banking, bank-related and
investment banking products and services to domestic and international
corporations, institutions and other customers. The Global Finance group serves
as a principal lender and investor, as well as an advisor, 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 consulting are representative of the services
provided. These services are provided through various domestic and
international offices. Through NMS, Global Finance is a primary dealer of U.S.
Government securities and underwrites, distributes and makes markets in
high-grade and high-yield debt securities and equity securities and in
derivative products. Major centers for Global Finance activities are Charlotte,
Chicago, London, New York, San Francisco, Singapore and Tokyo.
Financial Services is comprised of NationsCredit Consumer Corporation,
NationsCredit Commercial Corporation, EquiCredit Corporation and Oxford
Resources Corp. NationsCredit Consumer Corporation, which has 268 branches in
41 states, provides personal, mortgage and automobile loans to consumers, and
retail finance programs to dealers. NationsCredit Commercial Corporation
specializes in equipment loans and leases; 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. EquiCredit Corporation provides sub-prime mortgage
and home equity loans directly and through correspondents and Oxford Resources
provides lease financing for purchasers of new and used cars.
As part of its operations, the Corporation regularly evaluates the
potential acquisition of, and holds discussions with, various financial
institutions and other businesses of a type eligible for bank holding company
ownership or control. In addition, the Corporation 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. The Corporation also regularly considers the potential disposition
of certain of its assets, branches, subsidiaries or lines of businesses. As a
general rule, the Corporation publicly announces any material acquisitions or
dispositions when a definitive agreement has been reached.
3
<PAGE>
Government Supervision and Regulation
General
As a registered bank holding company, the Corporation is subject to the
supervision of, and to regular inspection by, the Board of Governors of the
Federal Reserve System (the "Federal Reserve Board"). The Banks are principally
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 and state
regulatory agencies. In addition to banking laws, regulations and regulatory
agencies, the Corporation 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 operations
and management of the Corporation and its ability to make distributions. The
following discussion summarizes certain aspects of those laws and regulations
that affect the Corporation.
The activities of the Corporation, 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 the Corporation, are
required to obtain prior approval of the Federal Reserve Board to engage in any
new activity or to acquire more than 5% of any class of voting stock of any
company.
Bank holding companies are also required 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 acquisitions under state law, but subject to any state requirement that
the bank to be acquired 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, thereby creating interstate branches. This provision, which
became effective June 1, 1997, allowed each state, prior to the effective date,
the opportunity to "opt out" of this provision, thereby prohibiting interstate
branching within that state. Of those states in which the Banks are located,
only Texas has adopted legislation purporting to "opt out" of the interstate
branching provisions (which Texas law currently expires on September 2, 1999).
Furthermore, pursuant to the Interstate Banking and Branching Act, a bank is
now able to open new branches in a state in which it does not already have
banking operations if such state enacts a law permitting such de novo
branching. To the extent permitted under these laws, the Corporation plans to
consolidate its banking subsidiaries (with the exception of NationsBank of
Delaware, N.A.) into a single bank as soon as practicable. The Corporation
currently operates one interstate bank (i.e., a bank with banking centers in
more than one state) which is NationsBank, N.A., headquartered in Charlotte,
North Carolina, with offices in Arkansas, Florida, Georgia, Illinois, Iowa,
Kansas, Maryland, Missouri, New Mexico, North Carolina, Oklahoma, South
Carolina, Texas, Virginia and the District of Columbia. Separate banks continue
to operate in Delaware, Florida, Georgia, Kentucky (which the Corporation has
agreed to sell), Tennessee and Texas. As previously described, the Corporation
regularly evaluates merger and acquisition opportunities, and it anticipates
that it will continue to evaluate such opportunities.
4
<PAGE>
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. The likelihood and timing of any
such proposals or bills and the impact they might have on the Corporation and
its subsidiaries cannot be determined at this time.
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.
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 December 31, 1997 were 6.50% and
10.89%, 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 December 31, 1997 was
5.57%. Management believes that the Corporation meets its leverage ratio
requirement.
On January 9, 1998, the Corporation completed its merger with Barnett
Banks, Inc. a multi-bank holding company headquartered in Jacksonville,
Florida, (the "Barnett Merger"). On April 16, 1998, the Corporation filed a
Current Report on Form 8-K containing restated consolidated financial
statements of the Corporation reflecting the Barnett Merger (accounted for as a
pooling of interests). Capital ratios for 1997 included herein have not been
restated to reflect the Barnett Merger. Under regulatory guidelines, Barnett
Banks, Inc. was considered well capitalized on December 31, 1997.
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,
each of the Banks is considered well capitalized.
5
<PAGE>
Banking agencies have also adopted final regulations which mandate that
regulators take into consideration (i) concentrations of credit risk; (ii)
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); and (iii) 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. That evaluation will be made as a part of
the institution's regular safety and soundness examination. In addition, the
banking agencies have amended their regulatory capital guidelines to
incorporate a measure for market risk. In accordance with the amended
guidelines, the Corporation and any Bank with significant trading activity (as
defined in the amendment) must incorporate a measure for market risk in their
regulatory capital calculations effective for reporting periods after January
1, 1998. The revised guidelines are not expected to have a material impact on
the Corporation or the Banks' regulatory capital ratios or their well
capitalized status.
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. Each of the Banks is subject to various general regulatory policies and
requirements relating to the payment of dividends, including requirements to
maintain capital above regulatory minimums. The appropriate federal regulatory
authority is authorized to determine under certain circumstances relating to
the financial condition of the bank or bank holding company that the payment of
dividends would be an unsafe or unsound practice and to prohibit payment
thereof.
In addition to the foregoing, the ability of the Corporation 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. The right of the Corporation, 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. Similarly, under the cross-guarantee provisions of the Federal Deposit
Insurance Act, 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 the
registrant 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. 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.
6
<PAGE>
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 each of the years in the
five-year period ended December 31, 1997:
<TABLE>
<CAPTION>
Year Ended
December 31,
--------------------------------------------
1997 1996 1995 1994 1993
-------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
Ratio of Earnings to Combined Fixed Charges and
Preferred Stock Dividends:
Excluding interest on deposits ................ 2.0 2.0 1.8 2.0 2.5
Including interest on deposits ................ 1.5 1.5 1.4 1.5 1.6
</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.
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 NMS or other 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.
Securities may also be offered and sold, if so indicated in the Prospectus
Supplement, in connection with a remarketing after their purchase, in
accordance with their terms, by one or more firms, including NMS or other
affiliates of the Corporation ("remarketing agents"), acting as principal for
their accounts or an agent for the Corporation. Any remarketing agent will be
identified and the terms of its agreement with the Corporation described in a
Prospectus Supplement.
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<PAGE>
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 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.
In order to facilitate the offering of the Securities, the underwriters
may engage in transactions that stabilize, maintain or otherwise affect the
price of the Securities. Specifically, the underwriters may overallot in
connection with the offering, creating a short position in the Securities for
their own accounts. In addition, to cover overallotments or to stabilize the
price of the Securities or of any such other securities, the underwriters may
bid for, and purchase, the Securities or any such other securities in the open
market. Finally, in any offering of the Securities through a syndicate of
underwriters, the underwriting syndicate may reclaim selling concessions
allowed to an underwriter or a dealer for distributing the Securities in the
offering if the syndicate repurchases previously distributed Securities in
transactions to cover syndicate short positions, in stabilization transactions
or otherwise. Any of these activities may stabilize or maintain the market
price of the Securities above independent market levels. The underwriters are
not required to engage in these activities, and may end any of these activities
at any time.
Under agreements entered into with the Corporation, underwriters, dealers,
agents and remarketing 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.
NMS is a broker-dealer and a direct subsidiary of the Corporation. Each
initial offering and any remarketing of Securities involving NMS or any other
affiliate of the Corporation will be conducted in compliance with the
requirements of Rule 2720 of the National Association of Securities Dealers,
Inc. (the "NASD") regarding a NASD member firm's distributing the securities of
an affiliate. Following the initial distribution of the Securities, NMS may
offer and sell such Securities in secondary market transactions at negotiated
prices relating to prevailing prices at the time of sale or otherwise. NMS may
act as principal or agent in such transactions. This Prospectus and related
Prospectus Supplements may be used by NMS in connection with such transactions.
NMS will not execute a transaction in the Securities in a discretionary
account without the prior written specific approval of NMS's customer. NMS has
no obligation to make a market in the Securities and may
8
<PAGE>
discontinue its market-making activities at any time without notice, at its
sole discretion. Furthermore, NMS 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 NMS, by virtue of its
affiliation with the Corporation, is aware of material non-public information
relating to the Corporation. In such instance, NMS 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 NMS discontinues its market-making
activities.
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 (i) 3,000,000 shares of ESOP Convertible
Preferred Stock, Series C (the "ESOP Preferred Stock"), of which 2,192,387
shares were issued and outstanding as of January 9, 1998, (ii) 35,045 shares of
NationsBank Series B Preferred Stock, of which 9,341 shares were issued and
outstanding at January 9, 1998, and (iii) 20,000,000 shares of NationsBank
Series BB Preferred Stock, of which 8,056 shares were issued and outstanding as
of January 9, 1998.
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 Restated 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.
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
9
<PAGE>
preference rights of the Preferred Stock relative to any existing or 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 the ESOP Preferred Stock currently are convertible into Common
Stock at a conversion rate equal to 1.68 shares of Common Stock per share of
ESOP Preferred Stock, subject to certain customary anti-dilution adjustments.
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
10
<PAGE>
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.
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 that began on July 1, 1997, is $43.16 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 for the benefit of the ESOP. 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.
NationsBank Series B Preferred Stock
The NationsBank Series B Preferred Stock was issued in connection with the
merger of Boatmen's Bancshares, Inc. with and into NationsBank on January 7,
1997.
NationsBank may, without the consent of holders of NationsBank Series B
Preferred Stock, issue preferred stock with superior or equal rights or
preferences. The shares of the NationsBank Series B Preferred Stock rank prior
to the ESOP Preferred Stock and NationsBank Common Stock.
Holders of shares of NationsBank Series B Preferred Stock are entitled to
receive, when and as declared by the NationsBank Board, out of any funds
legally available for such purpose, cumulative cash dividends at an annual
dividend rate per share of 7% of the stated value thereof, payable quarterly.
Dividends on NationsBank Series B Preferred Stock are cumulative, and no cash
dividends can be declared or paid on any shares of
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<PAGE>
NationsBank Common Stock unless full cumulative dividends on NationsBank Series
B Preferred Stock have been paid or declared and funds sufficient for the
payment thereof set apart.
Each share of NationsBank Series B Preferred Stock has equal voting
rights, share for share, with each share of NationsBank Common Stock.
In the event of the dissolution, liquidation or winding up of NationsBank,
the holders of NationsBank Series B Preferred Stock are entitled to receive,
after payment of the full liquidation preference on shares of any class of
preferred stock ranking superior to NationsBank Series B Preferred Stock (if
any such shares are then outstanding) but before any distribution on shares of
NationsBank Common Stock, liquidating dividends of $100 per share plus
accumulated dividends.
Shares of NationsBank Series B Preferred Stock are redeemable, in whole or
in part, at the option of the holders thereof, at the redemption price of $100
per share plus accumulated dividends, provided that (i) full cumulative
dividends have been paid, or declared and funds sufficient for payment set
apart, upon any class or series of preferred stock ranking superior to
NationsBank Series B Preferred Stock; and (ii) NationsBank is not then in
default or arrears with respect to any sinking or analogous fund or call for
tenders obligation or agreement for the purchase or any class or series of
preferred stock ranking superior to NationsBank Series B Preferred Stock.
NationsBank Series BB Preferred Stock
The NationsBank Series BB Preferred Stock was issued in connection with
the Barnett Merger. The shares of NationsBank Series BB Preferred Stock rank
prior to NationsBank Series B Preferred Stock, ESOP Preferred Stock and
NationsBank Common Stock as to dividends and upon liquidation.
Holders of the NationsBank Series BB Preferred Stock are entitled to
receive, when and as declared by the NationsBank Board, out of assets of
NationsBank legally available for payment, cash dividends at the rate of $2.50
per annum per share. Dividends are payable quarterly on January 1, April 1,
July 1, and October 1 of each year. Dividends on the NationsBank Series BB
Preferred Stock are cumulative from January 1, 1998. Each dividend is payable
to holders of record as they appear on the stock register of NationsBank on the
record dates fixed by the NationsBank Board.
Subject to the terms and conditions set forth below, the holders of shares
of NationsBank Series BB Preferred Stock have the right, at their option, to
convert such shares at any time into fully paid and nonassessable shares of
NationsBank Common Stock (calculated as to each conversion to the nearest
1/1,000 of a share) at the rate of 6.17215 shares of NationsBank Common Stock
for each share of NationsBank Series BB Preferred Stock surrendered for
conversion (the "Conversion Rate"). The Conversion Rate is subject to
adjustment from time to time as described in the Corporation's Restated
Articles of Incorporation.
Shares of NationsBank Series BB Preferred Stock will be redeemable at the
option of NationsBank, in whole or in part, at a redemption price of $25 per
share plus accrued and unpaid dividends to the redemption date (the "Redemption
Price").
Shares of NationsBank Series BB Preferred Stock are not subject to a
sinking fund.
In the event of any liquidation, dissolution or winding up of the affairs
of NationsBank, whether voluntary or involuntary, the holders of NationsBank
Series BB Preferred Stock will be entitled to receive out of the assets of
NationsBank available for distribution to shareholders an amount equal to $25
per share plus an amount equal to accrued and unpaid dividends thereon to and
including the date of such distribution, and no more, before any distribution
will be made to the holders of any class stock of NationsBank ranking junior to
the NationsBank Series BB Preferred Stock as to the distribution of assets.
The merger or consolidation of NationsBank into or with any other
corporation, the merger or consolidation of any other corporation into or with
NationsBank or the sale of the assets of NationsBank substantially as an
entirety will not be deemed a liquidation, dissolution or winding up of the
affairs of NationsBank.
Holders of NationsBank Series BB Preferred Stock have no voting rights
except as required by law and, in the event that any quarterly dividend payable
on the NationsBank Series BB Preferred Stock is in arrears, the holders of
NationsBank Series BB Preferred Stock will be entitled to vote together with
the holders of
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<PAGE>
Common Stock at the Registrant's next meeting of shareholders and at each
subsequent meeting of shareholders unless all dividends in arrears have been
paid or declared and set apart for payment prior to the date of such meeting.
In those cases where holders of NationsBank Series BB Preferred Stock are
entitled to vote, each holder will be entitled to cast the number of votes
equal to the number of whole shares of NationsBank Common Stock into which his
or her NationsBank Series BB Preferred Stock is then 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 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.
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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.
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.
14
<PAGE>
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.
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 1,250,000,000 shares of its Common
Stock, of which 945.7 million shares were outstanding following the Barnett
Merger on January 9, 1998. The Common Stock is traded on the New York Stock
Exchange and on the Pacific Exchange under the symbol "NB." The Common Stock is
also listed on the London Stock Exchange, and certain shares are listed on the
Tokyo Stock Exchange. As of January 9, 1998, 127.4 million shares were reserved
for issuance in connection with various employee and director benefit plans of
NationsBank and the Corporation's Dividend Reinvestment and Stock Purchase Plan
and the conversion of outstanding convertible securities of the Corporation and
for other purposes. After taking into account the shares reserved as described
above, approximately 167.4 million authorized shares of the Common Stock
remained available for issuance for other corporate purposes as of January 9,
1998.
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
15
<PAGE>
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 Preferred
Stock all of the shares of Common Stock into which such shares are converted
will be, validly issued, fully paid and nonassessable.
ChaseMellon Shareholder Services, L.L.C. 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 LLP, New York, New York. As
of the date of this Prospectus, certain members of Smith Helms Mulliss & Moore,
L.L.P., beneficially own approximately 160,000 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, 1997 and the Corporation's Current Report on
Form 8-K filed April 16, 1998 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.
The consolidated financial statements of BankAmerica Corporation at
December 31, 1997 and 1996, and for the three years ended December 31, 1997,
incorporated herein by reference from the Corporation's Current Report on Form
8-K filed on April 17, 1998 (as amended by Form 8-K/A filed April 24, 1998),
have been audited by Ernst & Young LLP, independent auditors, as set forth in
their report thereon incorporated herein in reliance upon such report given on
the authority of such firm as experts in accounting and auditing.
16
<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, NationsBanc Montgomery Securities, LLC or any
other affiliate of 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. This
Prospectus and related Prospectus Supplements may be used by NationsBanc
Montgomery Securities LLC, a broker-dealer and a direct wholly owned subsidiary
of the Corporation or any other affiliates 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 ............................. 7
Plan of Distribution ..................... 7
Description of Preferred Stock ........... 9
Description of Depositary Shares ......... 13
Description of Common Stock .............. 15
Legal Opinions ........................... 16
Experts .................................. 16
</TABLE>
$10,000,000,000
(NationsBank logo appears here)
Preferred Stock
Depositary Shares
Common Stock
-----------------------------------
PROSPECTUS
-----------------------------------
, 1998
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The estimated epenses, 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 ................ $2,950,000
Printing and Engraving Expenses ................ 455,000
Legal Fees and Expenses ........................ 865,000
Accounting Fees and Expenses ................... 335,000
Blue Sky Fees and Expenses ..................... 40,000
Unit Agents', Warrant Agents', Trustees' and
Preferred Stock Depositary's Fees and Expenses
(including counsel fees) .................... 1,160,000
Rating Agency Fees and Expenses ................ 2,000,000
Listing Fees ................................... 50,000
Miscellaneous .................................. 45,000
----------
$7,900,000
</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 believed 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.
II-1
<PAGE>
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 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>
<S> <C>
1.1 Form of Underwriting Agreement for Debt Securities, incorporated herein by
reference to Exhibit 1.1 of the Registrant's Registration Statement on Form S-3
(Registration No. 333-1381)
1.2 Form of Underwriting Agreement for Preferred Stock, incorporated herein by
reference to Exhibit 1.2 of the Registrant's Registration Statement on Form S-3
(Registration No. 333-1381)
1.3 Form of Underwriting Agreement for Common Stock, incorporated herein by
reference to Exhibit 1.3 of the Registrant's Registration Statement on Form S-3
(Registration No. 333-1381)
1.4 Form of Underwriting Agreement for Warrants and Units
1.5 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 New York, National Association (now U.S. Bank Trust
National Association), 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)
4.13 Form of Warrant Agreement for Universal Warrant (The form of such Warrant
Agreement with respect to each particular offering will be filed as an exhibit to a
Current Report on Form 8-K and incorporated herein by reference)
</TABLE>
II-2
<PAGE>
<TABLE>
<S> <C>
4.14 Form of Warrant Agreement for Warrants Sold Alone (The form of such Warrant
Agreement with respect to each particular offering will be filed as an exhibit to a
Current Report on Form 8-K and incorporated herein by reference)
4.15 Form of Warrant Agreement for Warrants Sold Attached to Debt Securities (The
form of such Warrant Agreement with respect to each particular offering will be
filed as an exhibit to a Current Report on Form 8-K and incorporated herein by
reference)
4.16 Form of Unit Agreement (The form of such Unit Agreement with respect to each
particular offering will be filed as an exhibit to a Current Report on Form 8-K and
incorporated herein by reference)
4.17 Form of Put Warrant (included in Exhibit 4.13)
4.18 Form of Call Warrant (included in Exhibit 4.13)
4.19 Form of Unit Certificate (included in Exhibit 4.16)
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
12.2 Calculation of Ratios of Earnings to Fixed Charges and Preferred Dividends
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>
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.
II-3
<PAGE>
(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-4
<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 April 29, 1998.
NATIONSBANK CORPORATION
(Registrant)
By: * HUGH L. MCCOLL, JR.
------------------------------------
Hugh L. McColl, Jr.
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. Chief Executive Officer and April 29, 1998
---------------------------------- Director (Principal Executive
(Hugh L. McColl, Jr.) Officer)
* JAMES H. HANCE, JR. Vice Chairman, Chief Financial April 29, 1998
---------------------------------- Officer and Director (Principal
(James H. Hance, Jr.) Financial Officer)
* MARC D. OKEN Executive Vice President April 29, 1998
---------------------------------- (Principal Accounting Officer)
(Marc D. Oken)
* ANDREW B. CRAIG III Chairman of the Board April 29, 1998
----------------------------------
(Andrew B. Craig III)
Director April , 1998
----------------------------------
(Ray C. Anderson)
* RITA BORNSTEIN Director April 29, 1998
----------------------------------
(Rita Bornstein)
* B.A. BRIDGEWATER, JR. Director April 29, 1998
----------------------------------
(B.A. Bridgewater, Jr.)
* THOMAS E. CAPPS Director April 29, 1998
----------------------------------
(Thomas E. Capps)
* ALVIN R. CARPENTER Director April 29, 1998
----------------------------------
(Alvin R. Carpenter)
* CHARLES W. COKER Director April 29, 1998
----------------------------------
(Charles W. Coker)
</TABLE>
II-5
<PAGE>
<TABLE>
<CAPTION>
Signature Title Date
- ---------------------------------------- ------------------------ ---------------
<S> <C> <C>
* THOMAS G. COUSINS Director April 29, 1998
----------------------------------
(Thomas G. Cousins)
* ALAN T. DICKSON Director April 29, 1998
----------------------------------
(Alan T. Dickson)
* PAUL FULTON Director April 29, 1998
----------------------------------
(Paul Fulton)
* C. RAY HOLMAN Director April 29, 1998
----------------------------------
(C. Ray Holman)
* W. W. JOHNSON Director April 29, 1998
----------------------------------
(W. W. Johnson)
* KENNETH D. LEWIS President and Director April 29, 1998
----------------------------------
(Kenneth D. Lewis)
* RUSSELL W. MEYER, JR. Director April 29, 1998
----------------------------------
(Russell W. Meyer, Jr.)
* RICHARD B. PRIORY Director April 29, 1998
----------------------------------
(Richard B. Priory)
* CHARLES E. RICE Director April 29, 1998
----------------------------------
(Charles E. Rice)
* JOHN C. SLANE Director April 29, 1998
----------------------------------
(John C. Slane)
* O. TEMPLE SLOAN, JR. Director April 29, 1998
----------------------------------
(O. Temple Sloan, Jr.)
* MEREDITH R. SPANGLER Director April 29, 1998
----------------------------------
(Meredith R. Spangler)
* ALBERT E. SUTER Director April 29, 1998
----------------------------------
(Albert E. Suter)
* RONALD TOWNSEND Director April 29, 1998
----------------------------------
(Ronald Townsend)
* JACKIE M. WARD Director April 29, 1998
----------------------------------
(Jackie M. Ward)
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
Signature Title Date
- ---------------------------------------- ---------- ---------------
<S> <C> <C>
* JOHN A. WILLIAMS Director April 29, 1998
----------------------------------
(John A. Williams)
* VIRGIL R. WILLIAMS Director April 29, 1998
----------------------------------
(Virgil R. Williams)
*By: /s/ CHARLES M. BERGER
------------------------------
(Charles M. Berger)
Attorney-in-Fact
</TABLE>
II-7
<PAGE>
EXHIBIT INDEX
<TABLE>
<S> <C>
1.1 Form of Underwriting Agreement for Debt Securities, incorporated herein
by reference to Exhibit 1.1 of the Registrant's Registration Statement on
Form S-3 (Registration No. 333-1381)
1.2 Form of Underwriting Agreement for Preferred Stock, incorporated herein
by reference to Exhibit 1.2 of the Registrant's Registration Statement on
Form S-3 (Registration No. 333-1381)
1.3 Form of Underwriting Agreement for Common Stock, incorporated herein by
reference to Exhibit 1.3 of the Registrant's Registration Statement on Form
S-3 (Registration No. 333-1381)
1.4 Form of Underwriting Agreement for Warrants and Units
1.5 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 New York, National Association
(now U.S. Bank Trust National Assocation), 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)
4.13 Form of Warrant Agreement for Universal Warrant (The form of such
Warrant Agreement with respect to each particular offering will be filed as
an exhibit to a Current Report on Form 8-K and incorporated herein by
reference)
4.14 Form of Warrant Agreement for Warrants Sold Alone (The form of such
Warrant Agreement with respect to each particular offering will be filed as
an exhibit to a Current Report on Form 8-K and incorporated herein by
reference)
4.15 Form of Warrant Agreement for Warrants Sold Attached to Debt Securities
(The form of such Warrant Agreement with respect to each particular
offering will be filed as an exhibit to a Current Report on Form 8-K and
incorporated herein by reference)
4.16 Form of Unit Agreement (The form of such Unit Agreement with respect to
each particular offering will be filed as an exhibit to a Current Report on
Form 8-K and incorporated herein by reference)
4.17 Form of Put Warrant (included in Exhibit 4.13)
4.18 Form of Call Warrant (included in Exhibit 4.13)
4.19 Form of Unit Certificate (included in Exhibit 4.16)
</TABLE>
<PAGE>
<TABLE>
<S> <C>
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
12.2 Calculation of Ratios of Earnings to Fixed Charges and Preferred Dividends
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>
Exhibit 1.4
[Warrants][Units]
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"), __________ [warrants][units] (the "Initial
[Warrants][Units]"). Such Initial [Warrants][Units] 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 [warrants][units] (the "Option
[Warrants][Units]"; together with the Initial [Warrants][Units], the
"[Warrants][Units]") to cover over-allotments. The [Warrants][Units] 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, 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
<PAGE>
under the Act of the [Warrants][Units]. 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 [Warrants][Units] 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.
[(c) The underlying securities, as set forth in the applicable
Final Prospectus, have been duly authorized and reserved for issuance
upon exercise of the [Warrants][Units].]
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
[Warrants][Units] set forth opposite such Underwriter's name in Schedule II
hereto, except that, if Schedule I hereto provides for the sale of Initial
[Warrants][Units] pursuant to delayed delivery arrangements, the respective
amounts of Initial [Warrants][Units] 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. [Warrants][Units] to be purchased by
the Underwriters are herein sometimes called the "Underwriters' Securities" and
[Warrants][Units] 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 [Warrants][Units] 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
3
<PAGE>
on Schedule I hereto, of the Initial [Warrants][Units] 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 amount of
Initial [Warrants][Units] 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 [Warrants][Units] 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
[Warrants][Units] 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 [Warrants][Units] 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 [Warrants][Units] 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 [warrant][unit] to be paid by the
several Underwriters for the Initial [Warrants][Units] shall be an amount equal
to the initial public offering price, less an amount per [warrant][unit] 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 [Warrants][Units] at the same price
per share determined as provided above for the Initial [Warrants][Units]. 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
[Warrants][Units] as to which the several Underwriters are exercising the
option,
4
<PAGE>
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 [Warrants][Units],
the Option [Warrants][Units] 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 [Warrants][Units] underwriting
obligations as set forth on Schedule II.
3. Delivery and Payment. Delivery of and payment for the Initial
[Warrants][Units] 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 [Warrants][Units] being herein
called the "Closing Date"). Delivery of the Initial [Warrants][Units] 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
[Warrants][Units] 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
[Warrants][Units] are purchased by the Underwriters, delivery and payment for
the Option [Warrants][Units] shall be made at the office specified for delivery
of the Initial [Warrants][Units] 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 [Warrants][Units] 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
[Warrants][Units] 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
[Warrants][Units], the Company will not file any amendment to the
Registration Statement or supplement (including the
5
<PAGE>
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 the [Warrants][Units] 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 [Warrants][Units] 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
[Warrants][Units] 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
6
<PAGE>
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 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
[Warrants][Units] 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 [Warrants][Units] and will arrange for the determination of the
legality of the [Warrants][Units] 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:
7
<PAGE>
(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 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, Barnett Bank, N.A.
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, to the best knowledge of such
Counsel, each of the Company and each of the Principal
Subsidiary Banks is qualified or licensed to do business as a
foreign corporation in each jurisdiction in which it is
required to be so qualified or licensed;
(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. ' 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 [Warrants][Units] conform in all material
respects to the description thereof contained in the Final
Prospectus;
8
<PAGE>
(v) if the [Warrants][Units] are to be listed on the
New York Stock Exchange, authorization therefor has been
given, subject to official notice of issuance and evidence of
satisfactory distribution, or the Company has filed a
preliminary listing application and all required supporting
documents with respect to the Initial [Warrants][Units] with
the New York Stock Exchange and such counsel has no reason to
believe that the Initial [Warrants][Units] 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 [Warrant][Unit] 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
9
<PAGE>
be limited by federal and state securities laws, and further
subject to 12 U.S.C. ss. 1818(b)(6)(D) and similar bank
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 [Warrants][Units] by the Underwriters and such other
approvals (specified in such opinion) as have been obtained;
(x) neither the issue and sale of the
[Warrants][Units], 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 the
Principal Subsidiary Banks; 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 issuance and sale of the [Warrants][Units] have
been duly authorized by the Company, and the
[Warrants][Units], when issued and paid for in accordance with
this Agreement and the [Warrant][Unit] Agreement, will (A) be
duly and validly issued, (B) constitute valid and legally
binding obligations of the Company, enforceable against the
Company in accordance with their terms and entitled to the
benefit of the [Warrant][Unit] Agreement, and (C) be
exercisable for such underlying securities,
10
<PAGE>
currencies or commodities or, in the case of underlying
securities or commodities, the cash value thereof, as set
forth in the applicable Final Prospectus in accordance with
the terms of the [Warrants][Units][; the underlying
securities, as set forth in the applicable Final Prospectus,
have been duly authorized and reserved for issuance upon
exercise of the [Warrants][Units]].
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 LLP, counsel for the Underwriters, such opinion or
opinions, dated the Closing Date, with respect to the issuance and sale
of the Initial [Warrants][Units], the [Warrant][Unit] Agreement, 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
11
<PAGE>
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 thereunder with respect to
registration statements on Form S-3 and the Exchange Act and
the regulations thereunder.
12
<PAGE>
(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;
(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
13
<PAGE>
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 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 [Warrants][Units] as contemplated
by the Registration Statement and the Final Prospectus.
14
<PAGE>
(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. 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 [Warrants][Units] to the Underwriters, including capital duties, stamp
duties and stock transfer taxes, if any, payable upon issuance of any of the
[Warrants][Units], the sale of the [Warrants][Units] to the Underwriters and the
fees and expenses of the transfer agent for the [Warrants][Units], (iv) the fees
and disbursements of the Company's counsel and accountants, (v) the
qualification of the [Warrants][Units] 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 [Warrants][Units] 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
15
<PAGE>
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
[Warrants][Units].
7. Conditions to Purchase of Option [Warrants][Units]. In the event the
Underwriters exercise the option granted in Section 2(c) hereof to purchase all
or any portion of the Option [Warrants][Units] 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 [Warrants][Units] that they shall have respectively agreed to
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
[Warrants][Units]:
(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
LLP, 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);
16
<PAGE>
(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 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 [Warrants][Units] 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
17
<PAGE>
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, 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
[Warrants][Units] 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 [Warrants][Units] 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
18
<PAGE>
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 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
19
<PAGE>
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 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 [Warrants][Units] 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 [Warrants][Units]
set forth opposite their names in Schedule II hereto bear to the
20
<PAGE>
aggregate amount of [Warrants][Units] set forth opposite the names of all the
remaining Underwriters) the [Warrants][Units] which the defaulting Underwriter
or Underwriters agreed but failed to purchase; provided, however, that in the
event that the aggregate amount of [Warrants][Units] which the defaulting
Underwriter or Underwriters agreed but failed to purchase shall exceed 10% of
the aggregate amount of [Warrants][Units] 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 [Warrants][Units], and if such
nondefaulting Underwriters do not purchase all the [Warrants][Units], 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 [Warrants][Units], 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 by Federal
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 [Warrants][Units].
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 [Warrants][Units]. 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,
21
<PAGE>
with a copy to: Stroock & Stroock & Lavan LLP, 180 Maiden Lane, New York, New
York 10038-4982, 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, NC1-007-20-01, Charlotte, North Carolina 28255, Attn: Paul J.
Polking, General Counsel; and Smith Helms Mulliss & Moore, L.L.P., 201 North
Tryon 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: _____________________________
I-1
<PAGE>
SCHEDULE II
Principal Amount of
Initial [Warrants]
Underwriters [Units] to be Purchased
II-1
<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"), [warrants][units] (the "[Warrants][Units]") 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 [Warrants][Units] 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 [Warrants][Units] 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 [Warrants][Units] will be
registered in the name of the undersigned and issued in a denomination equal to
the aggregate amount of [Warrants][Units] to be purchased by the undersigned on
the Delivery Date.
The obligation of the undersigned to take delivery of and make payment
for [Warrants][Units] on the Delivery Date, and the obligation of the Company to
sell and deliver [Warrants][Units] 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 [Warrants][Units] 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 [Warrants][Units] 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 set forth below
notice to such effect, accompanied by a copy of the opinion of
III-1
<PAGE>
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
[Warrants][Units], and the obligation of the Company to cause the [Warrants]
[Units] to be sold and delivered, shall not be affected by the failure of any
purchaser to take delivery of and make payment for the [Warrants][Units]
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)
III-2
<PAGE>
SCHEDULE IV
_________ [Warrants][Units]
NATIONSBANK CORPORATION
(a North Carolina corporation)
[Warrants][Units]
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 [warrants][units]
issued by 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 LLP, 180 Maiden
Lane, New York, New York 10038.
Pursuant to Section 2 of the Underwriting Agreement, the
Company agrees with each Underwriter as follows:
1. The initial public offering price per [warrant][unit]for
the Initial [Warrants][Units], determined as provided in said Section 2, shall
be $__.__.
2. The purchase price per [warrant][unit] for the Initial
[Warrants][Units] 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.
IV-1
<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.
IV-2
<PAGE>
SCHEDULE A
A-1
[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.
<TABLE>
<S> <C>
REGISTERED $________________
NUMBER R______
Common Code No. ________________ CUSIP 638585 ___
ISIN ___________________________
SEE REVERSE FOR CERTAIN DEFINITIONS
AND ADDITIONAL PROVISIONS
</TABLE>
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 _________________________ DOLLARS(1)
on _____________________, 19___,(2) and to pay interest on said principal sum,
semi-annually(3) 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
(continued...)
<PAGE>
arrears on ____________________ and ___________________ of each year, commencing
_______________________, at the rate of ___% per annum)(4), 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)
Notes of a series may be renewed at the option of the holder, or extended at the
option of the 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
(continued...)
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
________________
(5) (...continued)
amounts.
3
<PAGE>
CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
U.S. BANK TRUST 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 U.S. Bank Trust 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 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:
<TABLE>
<S> <C>
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
</TABLE>
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
[Box appears here to insert requested information]
- --------------------------------------------------------------------------------
(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: ___________________
______________________________
8
<PAGE>
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>
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
- --------
(1) Applies only if this Note is a Global Security.
<PAGE>
____________ 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 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 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
2
<PAGE>
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:_____________
U. S. BANK TRUST 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 U.S. Bank Trust
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 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
5
<PAGE>
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 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
6
<PAGE>
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 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
7
<PAGE>
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: ________________________ _________________________
9
<PAGE>
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.
10
<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.]
11
<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 FLR _______ $ ________________
NATIONSBANK CORPORATION
MEDIUM-TERM SENIOR NOTE, SERIES ___
(Floating Rate)
<TABLE>
<CAPTION>
<S> <C>
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
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.
</TABLE>
- --------
(1) Applies only if this Note is a Global Security.
<PAGE>
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 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 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
2
<PAGE>
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:____________________________
[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: ____________________________
U.S. BANK TRUST 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 U.S. Bank Trust
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 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
6
<PAGE>
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 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
7
<PAGE>
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 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
8
<PAGE>
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 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:
Money Market Yield = D x 360
-------------
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
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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.
(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
10
<PAGE>
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 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, on the basis of the prime rates, as of the close of business
on the Prime Rate Interest
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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.
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
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<PAGE>
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 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.
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<PAGE>
"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 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 ef fective as of the next Interest Reset
Date.
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[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 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
15
<PAGE>
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 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
16
<PAGE>
operator of the Euroclear system, in accordance with the rules and procedures
established by such depositories.
17
<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:_________________________ ________________________________
18
<PAGE>
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)
---------------- --------------------
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<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.
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
22
<PAGE>
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>
[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, 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.
<TABLE>
<S> <C>
REGISTERED $_______________
NUMBER R-______
Common Code No. _____________ CUSIP 638585 ___
ISIN ________________________
SEE REVERSE FOR CERTAIN DEFINITIONS
AND ADDITIONAL PROVISIONS
</TABLE>
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 _________________________ DOLLARS(1)
on _____________________, 19___,(2) and to pay interest on said principal sum,
semi-annually(3) 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
(continued...)
<PAGE>
arrears on ____________________ and ___________________ of each year, commencing
__________________________, at the rate of ___% per annum)(4), 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)
Notes of a series may be renewed at the option of the holder, or extended at the
option of the 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
(continued...)
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
______________________
(5)(...continued)
amounts.
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 Security 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
- --------
(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>
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 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
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 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
6
<PAGE>
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 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
[Box appears here to insert requested information]
- --------------------------------------------------------------------------------
(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: ________________________
______________________________
8
<PAGE>
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>
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.
<TABLE>
<S> <C>
REGISTERED
NUMBER FXR _________ $__________
NATIONSBANK CORPORATION
MEDIUM-TERM SUBORDINATED NOTE,
SERIES ___ CUSIP 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:
</TABLE>
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
- --------
(1) Applies only if this Note is a Global Note.
1
<PAGE>
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 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 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
2
<PAGE>
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 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
6
<PAGE>
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 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
7
<PAGE>
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:________________
10
<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.
<TABLE>
<S> <C>
REGISTERED
NUMBER FLR _______ $_________
NATIONSBANK CORPORATION
MEDIUM-TERM SUBORDINATED NOTE,
SERIES ___
(Floating Rate)
</TABLE>
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.
- --------
(1) Applies only if this Note is a Global Security.
<PAGE>
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 _____________
______________________________________________________________, 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
2
<PAGE>
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 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:________________________________
[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 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
7
<PAGE>
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 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,
8
<PAGE>
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 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.
9
<PAGE>
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.
(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.
10
<PAGE>
"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 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
11
<PAGE>
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 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 Interest Determination Date will be the
Treasury Rate then in effect on such Treasury Rate Interest Determination Date.
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<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
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
13
<PAGE>
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 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
14
<PAGE>
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 ef fective 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 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.
15
<PAGE>
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 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.
16
<PAGE>
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.
17
<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.
18
<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:_______________ upon the face of this Note in every
particular, without alteration or
enlargement or any change whatever.]
19
<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)
---------------- --------------------
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<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.
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
21
<PAGE>
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.
22
<PAGE>
<PAGE>
April 29, 1998
NationsBank Corporation
NationsBank Corporate Center
Charlotte, North Carolina 28255
Re: Registration Statement on Form S-3 filed on April 29, 1998 with respect
to an Aggregate of $10,000,000,000 of Debt Securities, Warrants, Units,
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 $10,000,000,000 of its (i) unsecured debt securities (the "Debt Securities"),
which may be either senior or subordinated, (ii) warrants (the "Warrants"),
(iii) units (the "Units"), (iv) shares of its preferred stock (the "Preferred
Stock"), which may be represented by depositary shares (the "Depositary
Shares"), and (v) shares of its common stock (the "Common Stock" and, together
with the Debt Securities, Warrants, Units, 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, Depositary Shares
or Units or upon exercise of Warrants, 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
<PAGE>
NationsBank Corporation
April 29, 1998
Page 2
conditions set forth in the Registration Statement, the applicable Prospectus
and the applicable supplement(s) to such Prospectus, then (a) the Debt
Securities, Warrants or Units, as the case may be, will be validly authorized
and 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,
/s/ SMITH HELMS MULLISS & MOORE, L.L.P.
<TABLE>
<CAPTION>
<S> <C>
NationsBank Corporation and Subsidiaries Exhibit 12(a)
Ratio of Earnings to Fixed Charges
- ------------------------------------------------------------------------------------------------------------------------------------
(Dollars in Millions)
Year ended December 31
-----------------------------------------------------------------------------
1997 1996 1995 1994 1993
-----------------------------------------------------------------------------
Excluding Interest on Deposits
- --------------------------------------
Income before taxes .................................. $ 5,230 $ 4,536 $ 3,810 $ 3,293 $ 2,619
Equity in undistributed losses (earnings)
of unconsolidated subsidiaries ..................... - 2 (7) (3) (5)
Fixed charges:
Interest expense (including
capitalized interest) ......................... 5,060 4,342 4,706 3,056 1,512
Amortization of debt discount and
appropriate issuance costs .................... 19 20 12 8 6
1/3 of net rent expense ......................... 180 157 155 141 129
-----------------------------------------------------------------------------
Total fixed charges .......................... 5,259 4,519 4,873 3,205 1,647
Earnings (excluding capitalized interest) ............ $ 10,489 $ 9,057 $ 8,676 $ 6,495 $ 4,261
=============================================================================
Fixed charges ........................................ $ 5,259 $ 4,519 $ 4,873 $ 3,205 $ 1,647
=============================================================================
Ratio of Earnings to Fixed Charges ................... 1.99 2.00 1.78 2.03 2.59
Including Interest on Deposits
- -----------------------------------------------------
Income before taxes .................................. $ 5,230 $ 4,536 $ 3,810 $ 3,293 $ 2,619
Equity in undistributed losses (earnings)
of unconsolidated subsidiaries ..................... - 2 (7) (3) (5)
Fixed charges:
Interest expense (including
capitalized interest) ......................... 9,951 8,588 8,980 6,231 4,450
Amortization of debt discount and
appropriate issuance costs .................... 19 20 12 8 6
1/3 of net rent expense ......................... 180 157 155 141 129
-----------------------------------------------------------------------------
Total fixed charges .......................... 10,150 8,765 9,147 6,380 4,585
Earnings (excluding capitalized interest) ............ $ 15,380 $ 13,303 $ 12,950 $ 9,670 $ 7,199
=============================================================================
Fixed charges ........................................ $ 10,150 $ 8,765 $ 9,147 $ 6,380 $ 4,585
=============================================================================
Ratio of Earnings to Fixed Charges ................... 1.52 1.52 1.42 1.52 1.57
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
NationsBank Corporation and Subsidiaries Exhibit 12(b)
Ratio of Earnings to Fixed Charges and Preferred Dividends
- ------------------------------------------------------------------------------------------------------------------------------------
(Dollars in Millions)
Year Ended December 31
-----------------------------------------------------------------------------
1997 1996 1995 1994 1993
-----------------------------------------------------------------------------
Excluding Interest on Deposits
- -----------------------------------------------------
Income before taxes ................................ $ 5,230 $ 4,536 $ 3,810 $ 3,293 $ 2,619
Equity in undistributed losses (earnings)
of unconsolidated subsidiaries ................... - 2 (7) (3) (5)
Fixed charges:
Interest expense (including
capitalized interest) ....................... 5,060 4,342 4,706 3,056 1,512
Amortization of debt discount and
appropriate issuance costs .................. 19 20 12 8 6
1/3 of net rent expense ....................... 180 157 155 141 129
-----------------------------------------------------------------------------
Total fixed charges ........................ 5,259 4,519 4,873 3,205 1,647
Preferred dividend requirements .................... 17 25 37 43 43
Earnings (excluding capitalized interest) .......... $ 10,489 $ 9,057 $ 8,676 $ 6,495 $ 4,261
=============================================================================
Fixed charges ...................................... $ 5,276 $ 4,544 $ 4,910 $ 3,248 $ 1,690
=============================================================================
Ratio of Earnings to Fixed Charges ................. 1.99 1.99 1.77 2.00 2.52
Including Interest on Deposits
- -----------------------------------------------------
Income before taxes ................................ $ 5,230 $ 4,536 $ 3,810 $ 3,293 $ 2,619
Equity in undistributed losses (earnings)
of unconsolidated subsidiaries ................... - 2 (7) (3) (5)
Fixed charges:
Interest expense (including
capitalized interest) ............................ 9,951 8,588 8,980 6,231 4,450
Amortization of debt discount and
appropriate issuance costs ....................... 19 20 12 8 6
1/3 of net rent expense ............................ 180 157 155 141 129
-----------------------------------------------------------------------------
Total fixed charges ........................ 10,150 8,765 9,147 6,380 4,585
Preferred dividend requirements .................... 17 25 37 43 43
Earnings (excluding capitalized interest) .......... $ 15,380 $ 13,303 $ 12,950 $ 9,670 $ 7,199
=============================================================================
Fixed charges ...................................... $ 10,167 $ 8,790 $ 9,184 $ 6,423 $ 4,628
=============================================================================
Ratio of Earnings to Fixed Charges ................. 1.51 1.51 1.41 1.51 1.56
</TABLE>
<PAGE>
EXHIBIT 23.2
Consent of Independent Accountants
We hereby consent to the incorporation by reference in the Prospectuses
constituting part of the Registration Statements on Form S-3 (Nos. 33-44826;
33-57533; 33-63097; 333-7229; 333-13811; 333-15375; 333-18273 and 333-43137);
the Registration Statements on Form S-8 (Nos. 2-80406; 33-45279; 33-60695;
333-02875; 333-07105; 333-20913 and 333-24331) and the Post-Effective Amendment
No. 1 on Form S-8 to Registration Statements on Form S-4 (Nos. 33-43125;
33-55145; 33-63351; 33-62029; 33-62208; 333-16189 and 333-40515) of NationsBank
Corporation of our report dated January 9, 1998 appearing on page 46 of the
Annual Report on Form 10-K. We also consent to the incorporation by reference of
our report dated April 13, 1998 appearing on page 75 of the Current Report on
Form 8-K dated April 16, 1998.
PRICE WATERHOUSE LLP
Charlotte, North Carolina
April 28, 1998
Exhibit 23.3
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" and to the
incorporation by reference in the Registration Statement on Form S-3 and related
Prospectuses of NationsBank Corporation dated April 29, 1998 of our report dated
January 20, 1998, with respect to the consolidated financial statements of
BankAmerica Corporation incorporated by reference in its Annual Report on
Form 10-K for the year ended December 31, 1997, filed with the Securities and
Exchange Commission.
/s/ Ernst & Young, LLP
San Francisco, California
April 29, 1998
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"), in connection with
$10,000,000,000 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) warrants, which may be debt warrants or universal
warrants, (iii) purchase contracts, (iv) units, (v) shares of NationsBank
Corporation preferred stock, which may be represented by depositary shares, and
(vi) shares of NationsBank Corporation common stock (the debt securities,
warrants, purchase contracts, units, 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 April 22,
1998, 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 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.
Chief Executive Officer
Dated: April 22, 1998
<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C>
/S/ HUGH L. MCCOLL, JR. Chief Executive Officer and Director April 22, 1998
- ----------------------------------------------------------- (Principal Executive Officer)
(Hugh L. McColl, Jr.)
/S/ JAMES H. HANCE, JR. Vice Chairman, Chief Financial Officer April 22 1998
- ----------------------------------------------------------and Director (Principal Financial Officer)
(James H. Hance, Jr.)
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C>
/S/ MARC D. OKEN Executive Vice President and Chief April 22, 1998
- ------------------------------------------------------- Accounting Officer (Principal Accounting
(Marc D. Oken) Officer)
/S/ ANDREW B. CRAIG, III Director April 22, 1998
- -------------------------------------------------------
(Andrew B. Craig, III)
- --------------------------------------------------------
Director April __, 1998
(Ray C. Anderson)
/S/ RITA BORNSTEIN Director April 22, 1998
- --------------------------------------------------------
(Rita Bornstein)
/S/ B.A. BRIDGEWATER, JR. Director April 22, 1998
- ---------------------------------------------------------
(B.A. Bridgewater, Jr.)
/S/ THOMAS E. CAPPS Director April 22, 1998
- --------------------------------------------------------
(Thomas E. Capps)
/S/ ALVIN R. CARPENTER Director April 22, 1998
- --------------------------------------------------------
(Alvin R. Carpenter)
/S/ CHARLES W. COKER Director April 22, 1998
- --------------------------------------------------------
(Charles W. Coker)
/S/ THOMAS G. COUSINS Director April 22, 1998
- --------------------------------------------------------
(Thomas G. Cousins)
/S/ ALAN T. DICKSON Director April 22, 1998
- --------------------------------------------------------
(Alan T. Dickson)
/S/ PAUL FULTON Director April 22, 1998
- --------------------------------------------------------
(Paul Fulton)
/S/ C. RAY HOLMAN Director April 22, 1998
- --------------------------------------------------------------
(C. Ray Holman)
/S/ W. W. JOHNSON Director April 22, 1998
- ----------------------------------------------------------------
(W. W. Johnson)
/S/ KENNETH D. LEWIS Director April 22, 1998
- -----------------------------------------------------------
(Kenneth D. Lewis)
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
Signature Title Date
--------- ----- ----
/S/ RUSSELL W. MEYER, JR. Director April 22, 1998
- --------------------------------------------------------
(Russell W. Meyer, Jr.)
/S/ RICHARD B. PRIORY Director April 22, 1998
- --------------------------------------------------------
(Richard B. Priory)
/S/ CHARLES E. RICE Chairman of the Board April 22, 1998
- --------------------------------------------------------------
(Charles E. Rice)
/S/ JOHN C. SLANE Director April 22, 1998
- -----------------------------------------------------------------
(John C. Slane)
/S/ O. TEMPLE SLOAN, JR. Director April 22, 1998
- ----------------------------------------------------------
(O. Temple Sloan, Jr.)
/S/ MEREDITH R. SPANGLER Director April 22, 1998
- --------------------------------------------------------
(Meredith R. Spangler)
/S/ ALBERT E. SUTER Director April 22, 1998
- --------------------------------------------------------
(Albert E. Suter)
/S/ RONALD TOWNSEND Director April 22, 1998
- --------------------------------------------------------
(Ronald Townsend)
/S/ JACKIE M. WARD Director April 22, 1998
- --------------------------------------------------------------
(Jackie M. Ward)
/S/ JOHN A. WILLIAMS Director April 22, 1998
- ------------------------------------------------------------
(John A Williams)
/S/ VIRGIL R. WILLIAMS Director April 22, 1998
- --------------------------------------------------------
(Virgil R. Williams)
By: _________________________________
Attorney-in-Fact
</TABLE>
RESOLUTIONS OF
THE BOARD OF DIRECTORS OF
NATIONSBANK CORPORATION
April 22, 1998
Appointment of Committee
RESOLVED FURTHER, 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 resolutions duly adopted by the Board of Directors of the
Corporation at a meeting of the Board of Directors held on April 22, 1998, at
which meeting a quorum was present and acting throughout and that said
resolutions are in full force and effect and have 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 29 day of April, 1998.
s/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)_____
U.S. BANK TRUST 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
U.S. Bank Trust 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 U.S. Bank Trust
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 U.S. Bank Trust 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 U.S. Bank Trust
National Association, incorporated herein by
reference to Exhibit 3 of Form T-1,
Registration No. 33-83774.
Exhibit 4 By-Laws of U.S. Bank Trust 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 U.S. Bank Trust 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 U.S. Bank Trust
National Association, as of the close of
business on December 31, 1997, 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, as
amended, the trustee, U.S. Bank Trust National Association, 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 20th day of April, 1998.
U.S. BANK TRUST
NATIONAL ASSOCIATION
By /s/ Geovanni Barris
---------------------
Geovanni Barris
Assistant Vice President
-3-
<PAGE>
EXHIBIT 7 TO FORM T-1
U.S. BANK TRUST NATIONAL ASSOCIATION
STATEMENT OF FINANCIAL CONDITION
AS OF 12/31/97
($000'S)
ASSETS 12/31/97
---------
Cash and Due From Depository Institutions $ 37,537
Federal Reserve Stock 3,439
Fixed Assets 698
Intangible Assets 74,459
Other Assets 6,072
---------
TOTAL ASSETS $ 122,205
=========
LIABILITIES
Other Liabilities 8,020
---------
TOTAL LIABILITIES 8,020
EQUITY
Common and Preferred Stock 1,000
Surplus 120,932
Undivided Profits (7,747)
---------
TOTAL LIABILITIES AND EQUITY CAPITAL $ 122,205
=========
- -------------------------------------------------------------------------------
To the best of the undersigned's determination, as of this date the above
financial information is true and correct.
U.S. Bank Trust National Association
By: /s/ Geovanni Barris
-------------------
Geovanni Barris
Assistant Vice President
Date: April 20, 1998
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 3.)
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 Registration Statement No.
<PAGE>
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.
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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 15th day of April, 1998.
THE BANK OF NEW YORK
By: /s/ Heidi Van Horn-Bash
------------------------------
Heidi Van Horn-Bash, 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/ Heidi Van Horn-Bash
------------------------------
Heidi Van Horn-Bash, Agent
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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 December 31, 1997, published in accordance with
a call made by the Federal Reserve Bank of this District pursuant to the
provisions of the Federal Reserve Act.
Dollar Amounts
ASSETS in Thousands
- ------- --------------
Cash and balances due from
depository institutions:
Noninterest-bearing balances
<S> <C>
and currency and coin ............................................. $ 5,742,986
Interest-bearing balances ........................................... 1,342,769
Securities:
Held-to-maturity securities ......................................... 1,099,736
Available-for-sale securities ....................................... 3,882,686
Federal funds sold and securities
purchased under agreements to resell ................................ 2,568,530
Loans and lease financing receivables:
Loans and leases,
net of unearned income ................................ 35,019,808
LESS: Allowance for loan and
lease losses .......................................... 627,250
LESS: Allocated transfer
risk reserve .......................................... 0
Loans and leases, net of unearned
income and allowance and reserve ...................... 34,392,258
Assets held in trading accounts .............................................. 2,521,451
Premises and fixed assets (including
capitalized leases) ................................................. 659,209
Other real estate owned ...................................................... 11,992
Investments in unconsolidated
subsidiaries and associated
companies ........................................................... 226,263
Customers' liability to this bank
<PAGE>
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<S> <C>
on acceptances outstanding .......................................... 1,187,449
Intangible assets ............................................................ 781,684
Other assets ................................................................. 1,736,574
------------
Total assets ................................................................. $56,153,587
============
LIABILITIES
Deposits:
In domestic offices ................................................. $27,031,362
Noninterest-bearing ..................................... 11,899,507
Interest-bearing ........................................ 15,131,855
In foreign offices, Edge and
Agreement subsidiaries, and IBFs .................................. 13,794,449
Noninterest-bearing ..................................... 590,889
Interest-bearing ........................................ 13,203,450
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............................................... 2,338,881
Demand notes issued to the
U.S. Treasury ....................................................... 173,851
Trading liabilities .......................................................... 1,695,216
Other borrowed money:
With remaining maturity of one year
or less ........................................................... 1,905,330
With remaining maturity of more
than one year through three years ................................. 0
With remaining maturity of more
than three years .................................................. 25,664
Bank's liability on acceptances
executed and outstanding .......................................... 1,195,923
Subordinated notes and debentures ............................................ 1,012,940
Other liabilities ............................................................ 2,018,960
-----------
Total liabilities ............................................................ 51,192,576
===========
EQUITY CAPITAL
Common stock ................................................................. 1,135,284
Surplus ...................................................................... 731,319
Undivided profits and capital
reserves ............................................................ 3,093,726
<PAGE>
<CAPTION>
Net unrealized holding gains (losses)
<S> <C>
on available-for-sale securities .................................... 36,866
Cumulative foreign currency
translation adjustments ............................................. (36,184)
------------
Total equity capital ......................................................... 4,961,011
-----------
Total liabilities and equity capital ......................................... $56,153,587
===========
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